an act of lifting up or raising something; elevation.
Defining it is the easy part. Accurately measuring performance uplift is a whole other matter. Yet for any business, it’s imperative to quantify the amount of revenue increase to prove whether a particular strategy is working.
These five steps will get you closer to the answer:
- Set the Objective: How do you know if you are meeting an objective unless you start by setting one? Write it down. Make certain everyone understands the objective and buys into it.
- Measure the Right Thing: Armed with your new objective, now set the metrics criteria to measure it. Then stop and ask, are we measuring the right thing? As the airline industry learned, performance metrics based solely on load factors or passenger yield was not the best measurement. But creating a new metric that combined the two-revenue per available seat mile (RASM) provided a more focused target.
- Anything Can Be Measured: That’s correct. Anything. Your new metric might be difficult to measure – and even require powerful analysis of big data – but measure you must. Remember: Consumers rarely act on a whim. Something prompted them to make a purchase. Determine what it was and measure it.
- Eliminate the Noise: The data you are analyzing must be normalized. That’s because there’s a lot of noise in the marketplace – competition, seasonality, pricing, etc. – that can throw off your measurements. You need to eliminate it, and find the key variable you want to measure.
- Re-Measure and Repeat: You’ve set sound objectives for your company, found the right metrics, and normalized the data. Now the most critical step in the process: re-measure and measure again. This is crucial because the world we live in is dynamic, not static, where variables can change in a millisecond. Be prepared to recalibrate your metrics as you go.
Businesses that follow these steps and measure performance uplift the right way will stay ahead of the competition by having the ability to sell the right product to the right customer at the right time for the right price.