Why Adding Revenue Numbers Makes Prioritization More Effective (and how to do it)

I’ve talked a lot on this blog about the power of storytelling and how to use it to bring executives, teams, stakeholders and clients along with you on a product journey. One of the key features of a compelling story is specificity. The more specific you are, the better the story. The better the story the more likely you are to achieve your intended goals. One type of specificity many teams avoid is adding numbers to their stories. Numbers put teams on the hook for a specific target. They’re now committed to it and nothing short of achieving that number equals success. One specific type of number terrifies teams the most: revenue. Here’s a quick look at why revenue numbers are crucial to your story – especially when prioritizing work – and how to add them to your work stories.?

Every deliverable is a storytelling opportunity

Be it a project plan, requirements document, feature story, product roadmap, budget or strategic outline – every deliverable you create at work is an opportunity to tell a compelling story. This is your opportunity to paint a picture for your colleagues and inspire them to help make it a reality. The more specific that destination is, the easier it is for your teams to envision themselves there with you and how they will help you get there.?

There is a profound difference between this statement:

We will build a new mobile app.?

And this statement:

Only 2% of our revenue comes from the mobile channel yet 95% of our regular customers access our system at least once a week through a mobile device. If we converted just 10% of that usage to a weekly purchase our revenue would increase 185% or an average of $1.2MM per month more.?

In both cases, the team will build a mobile app. The purpose, passion, motivation and ultimate success of the team, however, will be deeply greater with the specificity of the second statement in mind.?

And yet, the money conversation still scares us

While many teams are increasingly comfortable with defining usage metrics for their work, they still shy away from the only metric their CEO really cares about: revenue. If you’re a regular here you know my deep belief in the power of understanding outcomes – measurable changes in customer behavior that drive business value. Your leadership team, however, cares much more about money. As much as we can and should speak about the behavior changes that function as leading indicators of revenue we also need to add financials into our prioritization and planning efforts.

I know that can be scary. Revenue is the “final boss” of metrics. This is the one the company lives and dies by as well as the determining factor in lots of other decisions. Committing to financial metrics means you are taking on the responsibility of (a part of) the company’s ongoing success. And you should. It’s your job.?

Let’s add currency symbols to our stories

Earlier this week I was fortunate enough to be in Hamburg, Germany for the Product at Heart conference. I caught Rich Mironov’s presentation on telling “money stories.” Rich’s crisp presentation got right to the heart of this point. Without revenue projections added into your product stories you’re stabbing in the dark – especially when it comes to prioritization. Take a look at these two photos I managed to take during his talk:

In both examples Rich shared he told specific stories about why the work was being done and an improved future state. And then he added one more thing: revenue projections. He noted that these were SWAG projections (Scientific Wild Ass Guesses) which is why they had a range indicated rather than an exact number.

All of a sudden, the team and its stakeholders can start to make an even more informed decision about which efforts to take on next and which to deprioritize for now. Just because a feature is exciting (AI anyone?), the projection is that even if it’s wildly successful it still won’t return on the investment as much as an improved onboarding experience. Now, we can add those numbers into our now/next/later roadmap (also in the image above) and have a clear picture of what we’ll try first and what we will work on later.?

The outcome projections are powerful and important. When you add a currency symbol to the story the next steps become much clearer. We should be honest that these are estimates. We should report regularly on our progress towards those money-based goals. And, as new evidence comes in, we should be comfortable changing the story and our prioritization based on new financial information (as much as any other new insights that have come in).?

Stories are more powerful when they are “money stories”

When we’re building a new product we are navigators of uncertainty. Not only do we have to try and decipher the future, we have to bring a whole host of people along with us. Stories help us do that. Specific stories are more compelling. Specific stories that discuss potential financial upside are even more compelling. They help us prioritize more effectively and communicate to our stakeholders about the things they care most about. Instead of avoiding money stories in your next planning session, bring them up explicitly and see what happens. Let me know in the comments.