Bigger Sales Pipelines Signal Revenue Growth for 2014
C9's analysis of its own customer base predicts good news for the economy. C9's Revenue Index shows a 19 percent growth in sales pipelines, indicating that economic growth is on the horizon for 2014. C9 looked at 1.8 trillion pipeline records to make the prediction, focusing on more established companies in the Fortune 1,000.
The numbers are consistent with other projections for 2014, according to Azita Martin, C9's vice president of marketing. Morgan Stanley's top analyst predicted that the S&P 500 would increase 13 percent next year, while Money Morning's Michael Robinson puts the S&P's growth at 15 percent.
Unlike economic indices, C9's inaugural Revenue Index looks at deals that companies are actually pursuing for 2014, offering a real world insight. CEO Michael Howard feels that company-provided analyses like C9's Revenue Index, with its large sample size, could eventually be considered comparable with other government measurements of economic conditions. Noting that C9 has economists, data scientists, and former professors on staff, he believes the numbers have the potential to have greater predictive power than these indices, which tend to rely on historical data. C9's Revenue Index specifically limited its scope to Fortune 1,000 companies in order to improve accuracy, since smaller, fast-growing companies could have skewed results.
Three-quarters of the increase in sales pipelines came from greater volume, notes Howard, while the remainder came from deals worth more money. If anything, that suggests economic growth for next year could be even higher. "The deal sizes are smaller because they are earlier in the pipeline, but as they mature they can become more valuable," Martin explains.
C9, formerly known as Cloud9, looks at sales pipelines pulled from CRM or marketing automation systems. It uses "random forest" modeling and machine learning to help predict a deal's potential to close. Companies implementing C9 do so expecting to see improved forecasting, better close rates, and additional insights into where their sales teams are excelling or struggling.
C9 also reported growth of 88 percent year-over-year in its own business. Among its new clients are a few familiar names: Google, Pitney Bowes, and ADP. Howard also indicated C9 will be releasing new information about its algorithmic processing capabilities early next year.
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