When I’m working with clients, there are varying degrees of maturity when it comes to the sales development metrics they track. I’ve found that by putting specific focus on 11 key sales development metrics, your sales professionals, and sales results will benefit in a few specific ways:
- Improved business acumen that comes with looking at the bigger sales picture, promoting an understanding of how high quality selling truly impacts the business
- Improvements in leading indicators like sales activities, pipeline quality, and territory planning
- Improvements in lagging indicators, such as average order growth and sales quota attainment
Three Key Sales Enablement Ingredients You Can’t Ignore if You Want Sales Growth
First and foremost, invest in a quality CRM and make sure sales managers and sales professionals are using it as the “central sales truth” for the organization. This will make your sales leadership job infinitely easier, and you’ll be able to better hold your sales professionals accountable for their success.
Second, have a defined sales process for simple and complex deals. I like to think of your sales process as a staircase, a defined set of steps (or stages) that every deal flows through. It tends to be linear in nature and it’s mapped within your CRM. This will help any sales manager or sales professional to see both strategic and tactical views of their sales territory or a specific opportunity.
Lastly, a defined sales methodology is needed. Sales methodology combines your strategies, sales training, and other tools that support your sales process. Think of this as your chess match. A sales professional selects what’s needed at any given time in order to move an opportunity forward in the sales process.
Sales Development Metrics That Matter to Your Team
The rest of this post shares 11 sales development metrics that matter most, along with ideas to implement them into your overall sales strategy.
- If your sales professionals are paying attention to deal revenue alone, that’s not enough. While you may make a strategic decision to sell a solution as a loss leader or at a lower profit, the risk is that those initial losses aren’t made up for in the future. For every opportunity in the sales pipeline, a professional should know the top-line revenue potential and the bottom-line profit potential. If profit potential is below expectations, there needs to be a plan in place to build that profit back to your baseline levels and improve over time.
- Profitability by salesperson. This metric ties to sales margins, but with a manager’s viewpoint. As a sales leader, being able to review profitability by salesperson both individually and in the aggregate will help you pinpoint areas to improve.
- Average order size / average account size. After reviewing this particular metric with one client, it became apparent that sales professionals were comfortable with the smaller opportunities but were falling short when it came to the larger deals. Their win rates with larger and more prominent deals were much lower. Because we had the data on average order size and average account size, we were able to focus in on this and refine their sales process to improve their larger deals.
- Sales people over or under goal. The important piece of this metric is that there are specific revenue and profit goals that are measured at a regular cadence for each sales professional. Then sales managers can track who is over or under goal; this leads to better decision making about coaching, sales territory adjustments, and additional sales development planning.
- Target account status / Top 5 opportunities. This metric is useful for both account management and prospecting. One client has a tiered account system and sales teams assigned by account, and this allows them to know the top sales opportunities within those accounts, and to adjust their sales strategy as needed.
- New meetings. This metric calls for a balance between quantity and quality. It also shows a sales manager how successful their teams are at cultivating new relationships and earning those first sales meetings. Coaching can come into play here in helping the sales professional run a great first sales meeting and qualifying any opportunities that come from them.
Sales Pipeline Metrics
- Closing percentage. Can your sales professionals tell you quickly and accurately what their closing percentage is? Closing percentage gives you a lot of data about your sales professionals, along with knowing how closely they monitor their own performance. Depending on your industry and company-specific trends, this data can tell you if they need better quality and quantity in their pipeline, where deals are getting stuck, or quarterly trends. This data can also help you to select deals to conduct a win/loss review onto learn key lessons for the future.
- Length of the sales cycle. How long it takes an opportunity to make its way through your sales cycle can tell you if it’s simple or complex, if it’s getting stuck at certain points in the process, or if there are skills your team needs to build to help them move their opportunities to a win or out of the pipeline.
- Quality and quantity of the pipeline. In the sales assessment work I do with clients, their sales professionals are asked to submit several deals for analysis that they consider to be “late stage.” In other words, they’re considered close to being won. A consistent theme is that a large percentage of these deals, when analyzed on 19 criteria, aren’t even truly qualified, let alone being close to won. This speaks to pipeline quality because it impacts a company’s ability to forecast product, people, and cash flow into the business. It also can make a sales professional complacent in filling the top of the pipeline with quantity, because they “think” these unqualified deals are going to close – so they put off prospecting and filing the top of the funnel.
- Pipeline stage balance. This metric ties closely to quality and quantity of pipeline, and it also relies heavily on your having a solid sales process in place. For example, if a sales professional has a heavy weighting of early-stage opportunities that aren’t getting to the proposal or demo stage, that may indicate a coaching or skill development need. If they are heavily weighted in the late stage but not moving to closure, that may tell you that the deals aren’t well qualified or that your sales professional doesn’t have all of the key relationships he or she needs to win.
Bonus Sales Development Metric
- Team member personal goals and development. This is the one metric that often gets lost but might be the biggest indicator of a sales professional’s drive and how successful your sellers will be in their role. As a sales leader, do you understand what’s motivating them to succeed in sales, and are there both formal and informal learning paths for them to continue honing their sales skills? In working with sales teams, team members get the opportunity to learn their strengths and weaknesses, and they put together an action plan whereby they’re coached regularly by their sales leaders. This goes beyond annual performance reviews and quarterly business reviews; it gets to the heart of why they care and what will continue to drive them toward success.
How to Implement Metrics in Your Sales Development Plan
The good news is that you may already be tracking some of these metrics, while others are new for you to consider. As you’re deciding which metrics to focus on, below are some ideas:
- Get your CRM and sales process in order. These are the foundational pieces that will support the implementation and tracking of any sales metrics you choose.
- Perform a win/loss review on your current metrics. What are you currently tracking, and what have the results been? This will help you to determine which metrics are providing the data points you need, and which metrics aren’t as relevant as maybe they once were.
- Decide on the top 5 metrics that will create the most sales growth for your team. Too many metrics are as dangerous as either not enough or not the right ones. When you’ve landed on those top five, put your laser focus on them, and use them to coach and guide your team. Make those metrics part of their action plans and quarterly business reviews. After two quarters, evaluate those metrics and make any necessary adjustments.
Get Started with Your Sales Development Metrics
Don’t let your competition get an advantage. We can help. If you want to know how to get started or improve your key sales development metrics, let’s talk. Contact us to schedule time for a discovery conversation with Amy.