It’s pretty hard to give a business presentation without numbers. But if you think words can be tricky, numbers present their own special challenges. It would seem that there could not be anything more definite than a number—after all, 100 is 100 no matter what language you use. Just like words, they mean different things to different people.
When you decide to use a number in your presentation, there are two important principles to keep in mind. The first principle is that numbers carry meaning beyond simply quantifying something. The mere use of numerical data in a presentation sends important signals to the audience. It tells them that you are competent—you have solid information to back up your sales pitch. It tells them you are prepared, because you have taken the time to gather the data.
A surprising statistic can make an impression on someone’s mind during your presentation. If they have to rely on memory a few days later to make the decision, they are far more likely to remember the impression than the number itself. In fact, researchers have shown that they may actually rely on the memory of the impression and then reconstruct a number in memory that matches what they felt when they heard the number!
The second principle is that numbers are meaningless except in relation to something else. The only way to make sense of a specific figure is to compare it to another familiar figure. Financial ratios are an excellent example of this. A 10 percent net margin may sound impressive, medical but you not if the previous year the margin was 15 percent, or if other companies in the same industry have 30 percent net margins.
Provide the context first, and then the numbers. Believe it or not, an annual report provides an excellent example of this. You don’t get to the numbers section until way back in the annual report. The first sections are devoted to management’s explanations in the form of the Chairman’s Letter and Management’s Discussion of results.
Make the number something they can relate to. People have difficulty understanding large numbers; it’s best if they are on a human scale. For example, a $14 trillion national debt is incomprehensible—but not when you know it’s $140k for every non-government employee. (I hope that didn’t ruin your day.)
Percentages vs. real numbers. Another choice is to decide whether to express your numbers as real numbers or as percentages. In general, real numbers have greater impact, as demonstrated by research as well as sales common sense. Research shows that people generally find percentages easier to understand, but numbers have more impact. For example, in a study that sent postcards out asking for support for cancer research, a statement saying that cancer could strike thirty million Americans got more contributions than one that said it could strike 10% of the population. 10% is a concept; 30 million Americans is a lot of people. (Forest article)
In a sales presentation, real numbers give you greater credibility for the simple reason that you have to know your customer to use them. For example, you might be able to tell anyone your solution is 10% faster, but the only way you could say what 10% translates to in dollars is to know your customer’s own numbers.
Speak the language of their numbers. Senior level decision makers have a scorecard they follow very closely. At top levels, the scorecard may measure financial results such as revenues and profitability; at operational levels they are going to pay attention to process metrics such as throughput, cost per ton, etc. Know your audience, find out how they are measured, and use those measurements in your presentation for credibility and impact.
Se the contrast principle. Numbers only have meaning in comparison to another number. A number can appear small or large depending on what number it is compared against. The mental phenomenon of anchoring can means that the first number given affects how the next number is perceived. For example, if your solution costs $50,000, when you list alternative solutions you might want to begin with a solution that costs $60,000.
“Soft” numbers can be hard. Hard numbers are those that are directly measurable; soft numbers are difficult to measure or too intangible to really count. There are people who will tell you that only hard numbers count in business presentations.
That advice is seriously outdated in today’s knowledge economy—intangibles rule the earth now. Will your audience value such things as time to market, employee engagement, innovation, security even if you can’t put a hard dollar value on them? Of course they will. It’s your job to affect that perception; don’t preemptively surrender by leaving out intangible benefits. But make sure to ask questions and get them to tell you the value; frequently they will put a higher value on an intangible than you would dare to claim for it.
Double-check your calculations. This is even more important than avoiding typos. Any mistakes will throw everything else you say under a cloud of suspicion.
Use numbers sparingly. I’m a very numbers-oriented person, but even I tend to skip over some parts in books that contain a lot of numbers, unless I’m really motivated to pay close attention. Using too many numbers can cause your audience members to tune out.