Why Monthly Reporting Fails and What to Do Instead

Kasim: 00:00:11

Monthly reporting is a completely flawed model and it's going to lead

Kasim: 00:00:15

to nothing but disaster regardless of the business or industry you're in.

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Unless you have the shortest sales cycle of all time.

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And this is interestingly not even a marketing problem, this

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is a business ops problem.

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'cause very often marketing is forced into a position of reporting.

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On things monthly.

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As a matter of fact, the monthly reporting cycle is completely arbitrary.

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It has nothing to do with anything.

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But for whatever reason, every analytics tool I've ever seen is built to deliver

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reports according to the 30 day windows.

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catastrophic error.

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What you wanna do is you want to determine what your impact window

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is, what is your impact window?

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And you're gonna have multiple impact windows, by the way,

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and I'll explain what I mean.

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When you spend a dollar, how long does it take for you to

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see an impact if you're selling.

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Candy bars might be 48 hours if you're a private school, let's say

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you're private Catholic school, it could be a couple months, Like how long

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do mom and dad start doing research for the private Catholic school before

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they decide to sign up for a tour?

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what is your impact window?

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What is the inflection point between you spending money

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and actually seeing a result?

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I'll give you an example.

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We had the highest performing real estate investment campaign

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on the planet for seven years.

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It was through an agency that we sold in June of 2019.

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what we found is we had about a 45 day impact window before for top of

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funnel to the bottom of the funnel.

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So I spent a dollar, it took about 45 days for that dollar to turn into a lead.

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Now already, I'm giving you a very solid illustration of where a 30 day reporting

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window is massively flawed because what people do, and some of the most

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sophisticated real estate investors I've ever seen did this, they'd say, okay,

Kasim: 00:01:36

we spent a hundred grand in January.

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How much money did we make in January?

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That's nothing to do with anything.

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The money you spent in January didn't impact the money you made in January.

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You at least, at least say, okay, we spent a hundred grand in January.

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How much did we make in February?

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Right?

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Like a toddler walking through the world of marketing could sort of

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understand like, well, the money I made in January is gonna be reflected

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in the income I made in February, but for whatever weird reason, we've just

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decided like cash in, cash out is all.

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Time doesn't exist.

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Time's not a variable that I'll concern myself with.

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So this 45 day impact window was absolutely critical because if I wanted

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to see what lead flow looked like against spend, I should be looking at it on

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a 45 day cash in cash out timeline.

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Now here's what's really even more interesting is.

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That was just spend to lead.

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What we found from a business perspective is it took roughly seven months for

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the average deal to become a closed deal with real estate investment.

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Specifically, we were going after distressed homes.

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And so somebody says, I need to sell my house fast for cash.

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And we say, okay, we're interested in buying your house.

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And we put their house under contract or the investor puts their house under

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contract, and then once the house is under contract, the investor goes and

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they shop the house around they try to sell the house to somebody else.

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And then once they've done that, they made their money seven months

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on average for that whole process.

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So if you're trying to do a cash in, cash out comparison, if you want

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efficiency ratio or r o i or whatever, it's that you're trying to identify.

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If we spent a hundred grand in January asking yourself how much money you made

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in January, you don't get to do that.

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January expenses aren't gonna show any results until August.

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So now you can see like this 30 day window that I've thrust myself into.

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You're making decisions on these 30 day window.

Kasim: 00:03:04

All right, we spent how this much money in January.

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How much are we making in January?

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Or, you're being super sophisticated, how much money are we making in February?

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Means nothing.

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Spend a hundred grand in January.

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How much did I make in August?

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That's the correlation that I wanna identify and then follow through.

Kasim: 00:03:15

Oh, interesting.

Kasim: 00:03:16

Look, what happened is I boosted my ad spend here, decreased my ad spend there,

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again, I saw sophisticated marketers doing this, and I see sophisticated

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marketers do this all the time.

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What you wanna do is you need to identify where your lags are.

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What's the awareness lag?

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How long does it take for me to get somebody who's not aware at all?

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To be problem aware, solution aware, and then drive them to the conversion point.

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What's the conversion lag then what's my sales cycle?

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Awareness?

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Lag plus conversion.

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Lag plus sales cycle equals your data window.

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And sometimes that could be months, if not years, months, if not years.

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And you're gonna see massive swings.

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That's the other thing that's really interesting too, is people, especially

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young businesses that assume an L T V.

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Or calculate their L T V.

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If you've only been in business for two years, you don't know what your L T V is.

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What if you end up having customers for 15, 20 years?

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now, you might say like, that's not the business I'm in.

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Fine.

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what if it was, what?

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If you're in a business where you could have customers for extended

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periods of time, but you haven't been in business long enough to understand

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what your L T B could possibly be?

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knowing these numbers and being able to zoom out appropriately and

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properly, that's what's going to equip you to, to market correctly.

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So you have to look at your data properly, have to look at your data

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according to the right windows.

Kasim: 00:04:15

I'm sorry if I got too passionate here.

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There's no such thing.

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Anyway, I hope this is helpful.

Kasim: 00:04:19

Would love to know what you think.

Kasim: 00:04:21

Incidentally, how do you look at your data?

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What tools do you use?

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How do you zoom out?

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How do you identify where, where those lag periods are?

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'cause you can't always tell.

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Sometimes it's anecdotal, Like, you can't always tell when

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somebody's at the top of the funnel.

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That's very, very, very difficult to track.

Kasim: 00:04:32

Anyway, I'd love to hear from you.