You can’t achieve your revenue sales goal without monitoring interim sales and marketing metrics.
Most business owners focus only on the end goals: closed sales and net new clients. But focusing only on the end goal won’t ensure you’ll achieve it. You have to look at how you’re doing all along the way to the closed sale. Now the question is, what to watch?
There are 15 sales metrics you can monitor to identify what is – and isn’t working – with your sales. Without these metrics in place, you have no roadmap to diagnose issues and quickly see what needs to be done to assure you will reach your annual sales and growth goals. That’s the only way you will know what to adjust that will positively impact your revenue sales target and new business development objective.
As you begin the new year, or a new quarter, set a resolution for yourself to monitor these 15 sales metrics:
Annual Sales Metrics
These metrics look at sales performance overall. Think beyond the top two and set metrics that demonstrate to reps that you are looking for more than new sales revenue from them. To doubly reinforce your focus, align compensation plan with the metrics you set here.
- Total sales, either revenue or margin based on how you compensate sales reps
- Net new clients
- Current account revenue
- Sales growth
- Client retention
Sales Activity Metrics
Set these metrics based on daily, weekly and monthly performance based on the sales role. For example, an inside sales person whose role is primarily cold calling would have a daily cold call metric. An outside salesperson who is responsible for managing the full sales process would have a weekly cold call metric.
- Cold calls (This could include cold calls and emails combined, but an email really isn’t the same effectiveness as a phone call. If you want to include emails, set a separate sales activity metric for prospecting emails.)
- First-time appointments set
- New proposals
- New referrals
Sales Opportunity Metrics
These are the metrics that help you determine if your sales process is working and what you need to change. You’re monitoring conversion of opportunities through the sales process. If you see a significant opportunity loss at one phase in the sales process, you know you have a problem that needs to be addressed in that phase.
- Marketing qualified leads converted to sales qualified leads
- New opportunities entering the pipeline
- Opportunities that convert to proposals
- Proposals that convert to sales
Use these metrics to examine how well your lead generation is working and where you need to make adjustments. If you aren’t getting the number of marketing qualified leads (MQLs) you want or the MQLs aren’t converting, then you need to look at your messaging, target markets, and content as a start.
- Marketing qualified leads received
- List growth
Sales Metrics Identify Process Problems
As you read through these metrics you can see how they build on each other, painting a clear picture of what’s working in your sales and marketing process, and what needs adjustment. The metrics start all the way at the beginning of your sales process with list growth and marketing qualified leads, then follow each opportunity from lead identification through closed sale.
If you’re monitoring these sales and marketing metrics, you’ll know where you need to focus your attention.
You’ll clearly see if you have enough leads to convert to the number of new opportunities you need to achieve your sales goal and if those leads are moving smoothly through the sales process – or not. You may not know how to change the problem, but you’ll have a pretty good idea where the problem is that you need to fix.
Setting Sales Performance Expectations for Metrics
After reading these metrics, I know you want me to share what the target performance expectations should be for each one. Of course, it’s not that easy! Sales performance expectations are based on 6 factors:
- The sales role
- The person’s skill set
- Time on staff
- Your product maturity
- Company Recognition ROI
- The account base, both prospect list and current customer base
You will have different sales metric performance expectations for a new rep than you will for a sales rep who has been with you for 3 years, as well as different expectations for a Hunter versus a Farmer. Consider all these factors as you set performance expectations for your sales team.
Do it! Put Sales Metrics in Place
Put these 15 sales metrics in place and start monitoring them so you can see how you are performing as a company and individually, and where you need to make adjustments to achieve your goals.
We frequently work with clients to define these metrics and performance expectations when they’re hiring new salespeople, or when their current reps aren’t meeting the new business development goals set for them. If you’re building a sales organization and need help establishing metrics with measurable performance expectations, we can do that. Give us a call or email us, and we’ll set a time to talk about your specific situation.