Growth Modeling

F - Growth Modeling

Marketing nowadays becomes more and more data-driven. You can’t just convince another department to spend money without first show some real data about the impact of your marketing plan. Marketer need tools to make the model of growth to show how your plan can help the company. Spreadsheet can help you a lot to modeling growth.

 

Growth Modeling

I’ll use brand reach for some marketing channels to show how to make the model. This is what Hubspot use to model its growth and apparently it good enough for the to get spectacular growth. This model isn’t limited for modeling reach. It also can be used for modeling other growth like visits, leads, conversion rate, etc.

First, you have to calculate the month over month growth rate (MoM) using historical data. You can get historical data from your channel reach for the last year (for every month). To get the month over month growth rate you have to divide this month reach by last month reach and subtract it by one. Also, you have to make it into a percentage.

Growth Model - 1

Step 1

 

After that, you can take the average of historical month over month growth rate for projected growth rate. Of course, you can tweak the projected growth rate based on the trend in your industry, make your own best guess for the projected growth rate. But normally the average of historical growth rate is enough.

Growth Model - 2

Step 2

 

And then after you get the projected growth rate you can get the projected reach numbers for next month (or next three months) by multiply last month reach by 1 plus projected growth rate. It will help non-marketer see how you can help them, how your plan will make the company grow.

Growth Model - 3

Step 3

 

Conclusion

Convincing people about the need for marketing campaign is hard, it is even harder when you try to convince them without any data. By using spreadsheet model to projecting growth it will help other people see clearly how your attempt on doing marketing will help their business. It is even better when you can create a story and make awesome data visualization to help them see even more clearly.

You can download the template for growth model here.

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