Revenue Growth Drivers Analysis (aka. Price-Volume-Mix analysis) is another simple but powerful Revenue Growth Analytics method. It helps companies understand the specific factors driving their Net Revenue growth (or decline) and identify specific areas to take action for improvements.

Building this capability from customer-product level transactional data intuitively and visually is critical for companies, especially when they are having a hard time with Net Price Realization.

For example, for Consumer Product companies, robust and persistent inflation has created downward pressure from their Retail partners (especially the likes of Walmart) to dampen price increases.

But as we know, Net Revenue increases are more than just raising Prices or selling more stuff. It's also heavily influenced by optimal Customer and Product Mix Management.

This is where a Revenue Growth Drivers capability comes in: it enables you to identify specific Customer and Product segments where you can surgically raise prices and flag specific opportunities to increase the sales mix on higher priced (or more profitable) products.

In this video, the Revenue Growth Drivers Analysis technique is explored in detail for a fictitious company, Company ABC, to understand the drivers of year-over-year net revenue growth.

The analysis breaks down the impact of Pricing actions, Volume, and Customer and Product mix on the company's Net Revenue growth. The detailed analysis is conducted at the customer-product level rather than an aggregate level, allowing for more actionable insights.

We illustrate the detailed calculations for Pricing, Volume, and Mix impacts using an Excel Growth Drivers Analysis template, available for download here.