This post is an excerpt of an article originally posted on VentureBeat. For the full article, click here.
To gauge the efficiency of a company’s go-to-market model, CMOs are increasingly using a metric called the ‘Magic Number.’ The Magic Number is the product of a simple equation: Start with the difference in new customer revenues between the most recent two quarters. Divide that number by the earlier quarter’s sales and marketing total expenditures (people and program dollars) for acquiring new customers. Multiply by four to annualize, and … voila. No, it’s not magic — but the idea is that the metric gives executives (and investors) a measure of how efficient your marketing efforts are.
Want to learn more about the Magic Growth Number, and how it influences your go-to-market strategy?
Read the full article on VentureBeat.