Guide to Revenue Analytics

Introduction

Implementing revenue analytics is crucial for monitoring the revenue performance of any business and identifying problems that affect revenue growth. Operating a business without analyzing revenue efficiently is like attempting to lose weight without keeping track of the scales. The ability to track revenue proficiently, analyze the correct metrics and keep track of relevant revenue related KPIs can empower management while making strategic business decisions.

What is Revenue Analytics?

Revenue analytics is the method of collecting and analyzing data to study the revenue generation activities, evaluate revenue performance, and develop strategies to boost revenue further.

Every business has various types of activities which can be classified into non-revenue-generating tasks and revenue-generating tasks. Revenue analytics can provide an in-depth understanding of the latter, especially activities that help create income and profitability.

Generating revenue isn’t only sales and marketing, activities like operating plans, growth strategies, etc. also are linked to increasing revenue. This means different segments of an organization affect the revenue generation process. Revenue analytics aids in tracking all these activities by collating all revenue related data in a single place.

How Revenue Analytics Can Benefit Your Business?

By monitoring revenue over time, you can revise the sales management processes to improve revenue performance and make more accurate sales forecasting. Broadly, revenue analytics can provide the following assistance.

• It can help in tracking the sales revenue over a period and provide a facility to make a comparison with previous periods
• It can offer trends for key metrics like customer lifetime value, customer acquisition costs, annual recurring revenue, win rate, average deal size, etc.
• Detailed information on total number of leads and conversions to understand how many deals were closed
• Timeline on peak revenue performance
• Activities done by the team to drive revenue and top performing sales managers

How Is Revenue Analytics Undertaken?

We know that revenue refers to income, sales or turnover, monetary units, or plain money. The breakdown of every conceivable cost aids in understanding the revenue performance. E.g., a rise in gross margin often indicates that the business is moving well and is profitable, revenue analytics can provide trends and insights of such revenue parameters. Data from all departments of the business and its correlation to revenue data is evaluated against past or previous records & based on them future decisions are taken. It results in increasing revenues and cuts the deadwood. Hence, a business can ensure their plans and strategies do not deviate from their goal.

One of the most preliminary methods of conducting revenue analytics is on Microsoft Excel. An organization fetches data from its accounting software and crunches numbers in Excel to analyze it. Excel allows the user to create basic visualizations like charts and graphs, heat maps, etc. to view trends. While Excel is advantageous in certain ways, it has multiple limitations. E.g., reports are not updated automatically; higher chances of data errors due to incorrect copy-paste, data input and chart creation is manual, etc. Also, Microsoft Excel reports may be useful, but it’s hardly easy on the eye.

Nowadays revenue analytics software offers intelligent analytics dashboards where data updation is automated, report preparation is done in minutes, rich slicing and dicing ability is available and reports can be accessed anytime from anywhere. RevChamp, an analytics tool offered by Datachamps, offers industry specific revenue analytics dashboards which readily integrate with accounting software like Tally ERP, Tally Prime, Zoho Books, QuickBooks, etc.

Steps To Conduct Revenue Analytics

Standardize Data: Set templates of collating meaningful data is the most important step for developing any analytics. Apart from revenue data it is also important to standardize data like CRM data, supply chain, operations, HR, etc. such that these datasets can be correlated to the revenue data to gain intelligent insights.

Revenue Analytics Tools: As mentioned before, one can start processing the collated data on conventional platforms like MS Excel or subscribe to certain tools which provide ready KPIs and features as per requirement. Selecting the right tool can help the company to tap the best expertise from the tool provider and also remain lean.

Sharing Reports: Post the analytics exercise, any enterprise can share the reports containing actionable insights with relevant stakeholders. This can aid the organization in taking the right decisions at every level.

Revenue Analytics Tools

There are a lot of tools which offer revenue analytics solutions. But if a company needs a comprehensive solution that turns revenue data into actionable insights along with a guidance for the top management to take the right decisions, you may want to consider RevChamp.

RevChamp is a revenue analytics solution which integrates seamlessly with accounting software like Tally Prime, Tally ERP, Zoho Books, etc. to automatically fetch data and turn it into insightful dashboards within minutes. It comes with features like scheduling data update, industry specific ready KPIs, deep drill down options, etc. Some of the premium KPIs analyzed by RevChamp are sales trends, customer churn, seasonality, unit level economics, etc.

With a firm hold on revenue data and insights, any business can be sure of always being on top of their revenue generation process.