What does it mean to build a full-funnel reporting framework? Why is it important to have one?

Full-funnel analytics provides a data-driven view of the customer journey from lead to paying customer – full-funnel reporting gives a detailed view of each stage of the marketing and sales processes (i.e., the funnel) that converts a member of your target audience into a potential customer and, eventually, into a converted customer.

The full-funnel reporting framework meets the governance requirements of boards and PE firms that need visibility into company performance – investors expect a quality and thoroughness of reporting around efficiency, especially regarding a company’s ability to efficiently acquire revenue. PE firms might require all portfolio companies to use a similar framework to standardize reporting and improve clarity around performance.

Companies use full-funnel reporting to optimize revenue generation – measuring funnel-wide performance enables companies to systematically identify what is and isn’t working across the entire customer journey. Without end-to-end funnel visibility, teams operate in silos that make decisions without understanding the root causes of important problems, which leads to unoptimized outcomes.

Robust growth models depend on predictable results and reliable reporting – performance predictability influences a company’s valuation. Similar to how a plethora of historical data and analysis has improved weather forecasting over time, detailed, full-funnel analytics provide the foundation for performance in the coming months or years. Management teams use predictive growth models to conduct “what-if” analyses and make data-driven decisions about resource allocation.

Which parts of the go-to-market (GTM) organization does full funnel reporting apply to? Which teams should be involved in full funnel reporting?

Full funnel reporting applies to the activities of all customer-facing teams – the full GTM organization—Sales, Marketing, and Customer Success (for SaaS companies)— should leverage funnel-wide analytics to improve performance and the customer experience, which both begin at the top of the funnel. 

GTM teams are typically oriented around 2 key activities
New Logo Acquisition		Retaining Existing Customers
Marketing typically owns top-of-funnel activities and Sales manages bottom-of-funnel conversion.  SDRs/BDRs bridge the gap between the two.   Partner teams focused on driving awareness support Marketing initiatives, while referral-focused Partner functions work under the Sales umbrella.		Customer Success manages post-sales relationships, focusing on driving adoption and improving retention. If a Customer Success function has account management and revenue expansion responsibilities, they might also be part of the Sales organization.

How should organizations define the stages of their funnel?

Funnel stages should be defined by prospect actions – prospect actions provide a more objective indication of intent than internal activities or gauges and generally follow a clear progression (e.g., attend a webinar, download follow-up information, request more information, etc.). For example, “X time spent in the funnel” or “proposal sent to prospect” is a less useful indicator of prospect intent than “prospect attended an initial meeting”. As a prospect progresses, the likelihood that they represent a real sales opportunity increases. 

Stages should reflect material leakage points in the funnel – stages break the funnel into meaningful segments that are separated by clear actions that trigger significant drop-offs. This approach isolates specific variables in the marketing and sales process to clarify key conversion points and reflect genuine progression in the buyer’s journey. Some organizations use meetings to define stages.

Sample B2B SaaS Funnel
Section of Funnel	Example Stage
Top-of-funnel –  prospects enter the funnel before a human on your team has engaged with them. This could mean that they approached your booth at a trade show, visited your website, requested a demo / downloaded a whitepaper, etc.	Inbound lead initiates engagement
Mid-funnel – Sales and/or SDRs/ BDRs speak with prospects to do initial discovery and qualify leads. Qualified leads represent meaningful sales opportunities that have been vetted for their pain points, valid interest, budget, and timing needs.	First meeting scheduled
	First meeting completed
	Deeper dive meeting scheduled with broader team
	Deeper dive meeting completed
	Opportunity qualified
Bottom-of-funnel – once a lead is deemed a legitimate sales opportunity, it enters the proposal/ negotiation stage.	Technical evaluation completed
	Starting/ ending proof of concept
	Proposal requested
	Proposal sent
	Contract negotiations started
	Closed (won/lost)

What conversion rates should you look for between one stage and the next?

Conversion rates vary widely by industry, company, and sales motion – while all product funnels—and their corresponding conversion rates—differ, most funnels see significant drop-off rates at certain milestones. For example:

• Top-of-funnel: Web Visitors to Leads typically ranges from 1-2% – this metric can vary significantly, but is always a significant drop from the number of website visitors to the number of leads that are recognized by Marketing.
• Mid-funnel: First Meeting Show Rate is usually 50-70% – up to half of prospects who agree to a scheduled first meeting fail to attend. The initial time investment is a critical early qualification point.
• Bottom-of-funnel: Win Rate on Qualified Opportunities should be around 20-30% – most B2B companies convert around a quarter of legitimate sales opportunities into paying customers.

Reporting Components

What are the key components of a full-funnel reporting framework? Which elements should a company have in place to get the greatest benefit from their reporting?

Reporting frameworks are designed to answer key questions – think of reports as tools that measure factors that help you solve critical problems. Determine which questions (e.g., which of our channels has the best ROI?) will enable you to leverage your resources most effectively, then identify what you need to measure.

Proper instrumentation lets you measure the data that informs critical performance metrics – CRM (e.g., Salesforce or HubSpot) and marketing automation platform (e.g., HubSpot, Pardot, or Marketo) configurations capture the data that flows through your reporting framework. While barebones reporting is easy to implement, most companies underestimate the time it takes to configure a reporting tech stack that supports comprehensive analytics.

Data hygiene is essential for processes that rely on manual data entry – GTM data relies heavily on salespeople populating fields such as potential deal size, urgency indicators, and lead status. There are multiple tactics you can employ to reduce the impact of inaccurate and inconsistent data entry:

• Define clear processes for data entry (e.g., block 5 minutes after each customer-facing meeting to update the opportunity’s profile) 
• Automate data entry where possible
• Foster a culture that values accurate reporting
• Build a monitoring functionality into your CRM to flag possible errors and improve compliance

Data visualization and analysis tools present data in a way that surfaces opportunities for improvement – CRMs offer basic reporting capabilities. If you are able to invest in additional systems, specialized business intelligence tools like Data Warehouse, Snowflake, Tableau, and Power BI have robust full funnel analytics capabilities that enable a higher level of analysis that can expedite your funnel optimization process.

How should you evaluate full-funnel performance?

Look at the whole funnel in a comparative context to identify areas of opportunity – instead of evaluating top-of-funnel, mid-funnel, and bottom-of-funnel reports separately, consider all funnel metrics relative to 3 datasets:

• Industry benchmarks – variance relative to industry peers can reveal problem areas that your team might not be aware of. For example, if you are in line with industry benchmarks in all areas except the rate at which prospects attend the first scheduled meeting, your team has a clear first step when exploring how to improve performance. While sources such as Benchmarkit might offer slightly generic benchmarks for certain metrics, external context is an important factor in evaluating your company’s operational competitiveness.
• Plan – variance relative to plan can point to places where your team or strategy has veered off course, rendering the assumptions behind that plan invalid. For example, if you restructured your webinar and fewer webinar attendees ask for a meeting than you had projected, it might be worth reevaluating your new webinar strategy.
• Time – compare performance to the prior year or quarter to identify fluctuations. These fluctuations can reveal changes in your market, customer base, or GTM strategy effectiveness. 

Comparing full-funnel performance can reveal strengths in addition to challenges – performance context helps quantify the added value of optimizations your organization has made and inform future budgeting/ planning decisions.

If you don’t have strong historical data, start with well-backed assumptions – variance to time and plan depend on access to useful data. Early-stage or pivoting companies can partially compensate for this lack by layering assumptions on benchmark data and keeping detailed descriptions of the justifications for their targets. Even if the evaluation process is imperfect, it’s important to start somewhere.

What are some of the most important full-funnel reports?

Start with KPIs that indicate the quality and efficiency of revenue generation – metrics that reflect processes that occur across the funnel provide the most comprehensive view of performance. Useful full-funnel KPIs include:

• LRR – Leads Retained to Revenue measures the percentage of leads that the sales and marketing funnel converts into paying customers.
• CAC Payback – Customer Acquisition Cost Payback calculates your breakeven point (how long it takes to recover the cost of acquiring a new customer).
• Cost of ARR – the Cost of Annual Recurring Revenue calculates the sales and marketing expenses required to maintain existing customers and acquire new ones.
• Net ARR Payback – similar to CAC Payback, Net Annual Recurring Revenue Payback measures how long it takes to recover your investment in both new and existing ARR.
• Magic Number – the SaaS Magic Number measures sales efficiency (revenue generated per dollar spent acquiring new customers).
• LTV:CAC – the Customer Lifetime Value to Customer Acquisition Cost ratio compares the revenue a customer brings to an organization to the cost of acquiring that customer.

Dig into problem or opportunity areas by leveraging more granular reporting – once you’ve identified areas of particularly strong or weak performance, more traditional top-of-funnel, mid-funnel, or bottom-of-funnel analysis can help you better understand the root causes. 

Strategic Alignment

How should Finance and the GTM organization partner on developing a reporting framework?

GTM team leaders are the beneficiaries of strong reporting – Sales, Marketing, and Customer Success can make better decisions when they have a more detailed understanding of how they can improve GTM outcomes. However, GTM leaders might not have direct access to the right data, the reporting skills, or the inter-departmental alignment to develop this framework alone.

Finance acts as an unbiased consultative partner – Finance professionals leverage the same skills they use for FP&A and other financial analyses to create better reports for GTM teams. Their quantitative skills and big-picture perspective also provide a perspective that is more objective than the often-conflicting priorities of Sales, Marketing and Customer Success leaders.  

Some Finance teams are starting to own full funnel reporting – because Finance generally has stronger quantitative skills and CFOs are responsible for presenting revenue and profitability metrics to the board, some companies have shifted reporting ownership from the GTM to the Finance team.

How should Marketing and Sales share revenue goals?

Consider creating a unified compensation structure – if you incentivize all GTM leaders to achieve the same goals instead of team-specific objectives, the organization will become better aligned, more collaborative, and more efficient over time.

Focus goals around revenue outcomes, not team-specific activities – all GTM teams should be held accountable for achieving the revenue and efficiency goals (e.g., value-driving metrics such as revenue growth, the efficiency of acquiring revenue, and gross margin/ profitability) that the organization relies on. While team-specific goals (e.g., leads generated for Marketing, revenue generated for Sales, and accounts retained for Customer Success) are useful from an operational standpoint, primary goals should unify GTM team efforts around effective revenue generation.

Use GTM goals to share accountability across teams – metrics should help connect the actions of one team with the success and actions of another to help individuals understand how their role fits into the bigger picture. For example, some companies factor customer retention metrics into Sales and Marketing goals because acquiring the right customers impacts long-term retention.

Optimizing performance

What are key indicators that your GTM approach is or is not working?

Indicators of an Effective GTM Approach		Indicators of an Ineffective GTM Approach
Positive variance in performance – companies fixate on negative variance, but positive change often indicates an opportunity to further improve performance. Understand the root cause of positive variance and double down on behaviors or investments with above average productivity. Even positive variance within a sales team (e.g., certain reps performing better due to X, Y, or Z) can unlock improvement for the whole team if you can identify and learn to replicate effective strategies.		Poor conversion of organic leads – organic inbound leads—prospects that find your product and indicate interest without investment on your part—should be your best leads. If they convert at lower rates than sales prospecting leads, there is likely misalignment between Sales and Marketing that is causing Sales to ignore highly promising leads.

What are the different approaches companies can use for attribution?

Last click attribution:

• Doesn’t reveal the whole picture – content is everywhere and unknown interactions/ conversations occur constantly. A multitude of factors influence customer decisions. Just because a lead clicked on something or opened a document doesn’t mean that they read it or that it influenced them.  
• Builds greater certainty about the customer action that created a selling opportunity – it’s often impossible to discover every factor that influenced a customer to become a lead, but you can identify the final step that kicked off the selling process for an individual lead (e.g., a LinkedIn form, your website, an event).

Multi-touch attribution:

• Helps determine where your most valuable leads actually come from – build as much clarity as possible around which initiatives trigger the expensive, labor-intensive process of investing sales resources in converting a lead. 
• Requires maintaining data across sales touches and cycles – attributing each lead to the sourcing strategy that kicked off their original and converted cycle, leads to a better understanding of how leads progress through the funnel and how leads from different sources perform.

Self-reported attribution:

• Helps reveal the marketing investments prospects see before formally entering the funnel – ask prospects how they discovered your company. Use an open text field to remove any biases your team might have about how prospects learn about you. This feedback can provide valuable insight around marketing content investments and early indications of how longer term initiatives are paying off.

Overall

What are the most important things to get right?

View the funnel as a series of interconnected processes – the full-funnel reporting framework is undermined when companies set primary goals and focus on reports that immediately divide the funnel into top, middle, and bottom. The high level goals, underlying assumptions, and individual leads progressing through the funnel are the same—and evaluating performance holistically can yield useful insights that drive significant value.

Create reports that answer key questions and drive value – reporting should be pointed at helping leaders identify issues, triage their resources, and make better decisions.