Click the image above for details Jack Ma says we're in the digital age. I agree, but the concept of digitalization is still somewhat abstract, and it's mostly brand owners considering it. In practice, dealers should pay more attention to this, but in actual application, I think it's more accurate to say dealers are in the era of data-driven marketing. "No data, no decision; with data, better decisions." This is a truth I've always believed in and tested through practice. Many dealers are still family-run or mom-and-pop operations, without a clear understanding of their specific business metrics. They treat their money as their own, but they don't know how much they're earning, which products sell well, how much each salesperson contributes, or who their core customers are. Even if many owners have adopted management software and terminals, they fail to utilize the data from these tools effectively, only knowing rough figures. Today, I'll discuss the specific application of data in two dimensions: customer analysis and KPI assessment policies.
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Understand Your Customers Through Data to Drive Profitability
A dealer's sales and profits come from customers; the core asset of a dealer is actually the number of customers. Goods must be sold to customers to generate revenue, and brand owners value dealers based on the number of customers they control. So you need to thoroughly understand your customers; otherwise, how can you do business or market effectively? So how do you get to know your customers? Analyze them from the following dimensions:
1. Customer Activity This metric indicates the frequency of customer purchases; the higher the frequency, the greater the sales volume. This is a table from my company. Through this data, you can clearly see the activity level of each salesperson's customers. It's also clear that salesperson G has the lowest customer activity, allowing for timely investigation into the reasons—whether it's laziness, skipping stores, or poor customer relationships. Once the cause is identified, solving the problem becomes easier.
2. Customer Count Changes As the core asset, the number of customers is the most basic data to track, and the increase or decrease of customers is crucial. I recommend summarizing this data at least once a month: how many new customers were added, how many old customers were lost, and then analyze why those customers were lost. Otherwise, you might only realize at year-end that a salesperson assigned 150 stores ended up with only 110 due to skipping stores or poor relationships. By then, it's too late to criticize or scold. So this metric must be regularly checked and analyzed; in my company, the cycle is weekly. In this table, the top salesperson developed 8 new customers but lost 6 old ones. Investigation revealed that 4 customers closed due to a new supermarket nearby, and 2 were due to poor relationships, which could be remedied. Once the reasons are found, except for store closures, efforts should be made to win back lost customers. Developing new customers is a long-term continuous effort, and regular data reports are essential. Over time, if you have 10 salespeople, each developing 3 new customers per month, that's 360 per year. By also minimizing losses, your customer base will grow steadily.
3. Customer Cost Ratio It's important to know the cost ratio for each customer. In today's competitive market, many channels require significant investment. Modern trade has promotional staff, display fees, rebates, etc., while traditional trade has case-cutting and special display fees; sometimes customers won't order without incentives. Without data analysis, some salespeople just ask the boss for more policies, sometimes investing more in a customer than the profit generated. For example, I once had a salesperson who invested 300 yuan in a customer for a month, but sales were only 1,200 yuan—such investment is meaningless. Here's a detailed cost-check table for reference:
4. Customer Sales Ranking Many dealers have thousands of customers. Among them, which are your core customers? Which are marginal? You need to know this. For high-sales customers, try to maintain and even improve; for low-sales ones, find out why and maximize their sales—whether it's due to competitor pressure or the store's poor performance. Customers with high sales and high profit are core accounts to protect; those with high sales but low profit need key adjustments.
5. Customer Profit Ranking A dealer's profit accumulates from selling to each customer, so you need to know the profit from each customer and then find ways to increase it. If you have 1,000 customers, each generating an average of 100 yuan profit per month, that's 1.2 million per year. What if each customer generated 200 yuan per month? Additionally, you can identify customers who generate sales but no profit. I once had a customer, a secondary wholesaler, who did 1.6 million in business a year, but profit analysis showed only 0.3% profit—meaning they sold 1.6 million worth of goods without making any money. This situation likely exists for many dealers. Here's another table for dealers' reference:
In summary, through these data analyses, you can clearly grasp each customer's situation. You can see each customer's sales, gross profit, net profit, cost per ton, and profit per ton in detail. With data, you can also spot anomalies promptly. For example, if a supermarket has a gross margin of 10 points but a cost rate of 9 points, there's clearly a problem with high costs. By analyzing detailed cost data, you can identify the issue and find ways to reduce expenses. For instance, a friend told me he did 50 million in sales a year but didn't make money. Using the data-checking method I taught him, he found his gross margin was 14-15 points, but his cost rate was also 14 points. He was shocked; he hadn't realized his costs were so high. In reality, many dealer teams are professional in sales, but their poor profitability often stems from deficiencies in internal management, data application, and compensation performance. Once you have specific data, small improvements can have a big impact on earnings. For example, my friend with 50 million in revenue could gain 500,000 by increasing profit by just one point. In terms of specific data, that's just selling a 5-yuan soy sauce for 5 cents more. The key is whether you know how to use the data. In short, you need to grasp many data points in detail. Data is magical; for instance, if a dealer's business compared to the same period last year sees a 1% decrease in cost rate, a 1% increase in profit rate, and a 1% increase in sales, then profit can grow by 27%. Isn't that amazing? If you don't believe it, you can calculate it yourself. Now let's move to the other dimension of data application: KPI assessment policies.
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Use Data to Motivate Salespeople
As mentioned earlier, a dealer's profitability relies on selling goods, and two points are crucial: first, who you sell to—that's the customers; second, who sells—the sales team's importance is self-evident. So how can data be used to motivate and empower the sales team, making them more effective in developing new customers and boosting sales and profits? Nowadays, dealer salespeople are typically paid a base salary plus performance, with the performance portion determined by KPI assessments. Many dealers have incentive policies, but after implementing them, they fail to regularly analyze data to maximize the effectiveness of these policies. Let's look at different KPI assessment scenarios and how to analyze and apply the data.
1. Short-term Market Launch For example, I once set up a 10-day market launch drill with the incentive policy shown below. During this period, I had the supervisor clerk report KPI data daily. This allowed all salespeople to clearly see the rewards and penalties, and see their own and others' data every day. In this environment, all salespeople competed and looked up to the leaders. The result was that everyone exceeded their targets.
2. Hundred-Regiment Battle (PK) Besides short-term PK, there are also longer-term KPI assessments, typically reported weekly, with actions of each department and individual shown in tables. For example, during peak season, we conduct a Hundred-Regiment Battle (PK) among departments. In such assessments, compare task progress with time. For instance, after one-third of the time has passed, task completion should also reach or exceed one-third; otherwise, it means falling behind and possibly failing to complete. This prompts salespeople and departments to catch up. For long-term assessments, regularly compile and analyze data for each department, product line, and individual, and respond promptly. Such data helps salespeople and departments understand their work, find reasons for improvement, and take corrective action.
3. Phased Assessments To build team cohesion, it's also good to have occasional competitive reward assessments between departments. For example, I once set up a travel reward policy, as shown below. During this period, I had my clerk list all data for all product lines and departments, and track it, updating weekly until March. Everyone was enthusiastic about the team reward and worked hard towards it. By March, I increased the update frequency to every three days. With a deadline, everyone wanted the team travel opportunity, and high-frequency data updates better motivated the team. In such situations, everyone is pushing; without timely updates, some teams might be just 2 points away and give up, but frequent updates make them realize their progress and push through. Such incentive policies can sometimes push teams to exceed by 5 points, not just 2. It's this constant data stimulation that greatly motivates salespeople to achieve their tasks, and performance rises rapidly. With quantitative tasks and time limits, the completion progress should be proportional to time; if set reasonably, it can greatly motivate the team. Timely data updates also create a sense of urgency, preventing the situation where they only realize the progress in the last month and can't catch up, losing motivation. In essence, data provides dealers with a complete tracking system for salesperson work, without needing to monitor them and cause resentment, while also giving a clear view of their work completion. All bosses must remember: A dealer's intangible asset is customers, who create value, and that value is realized through salespeople. Data monitoring and analysis are meant to get salespeople moving and extract benefits from customers.