Unless you have more sales from ideal customers than you know what to do with, your organization can benefit from sales measurement strategies. They allow you to not only forecast future sales but also to dissect your team's success through each step of the sales cycle in order to fine-tune your approach and improve results.
Often, determination of your sales metrics results in adjustments to the way you are tracking your sales activities, ultimately allowing you to capture more meaningful, actionable data.
When discerning the sales metrics most relevant in your industry and most likely to move the needle within your specific company, begin internally and then look externally.
Internal Vantage Point: Examine your employee satisfaction and retention rates as the most basic indicators of strong company performance.
Next up, examine your entire sales process. Begin with the length of your sales cycle overall, and ideally monitor it each step along the way. If you operate an accounting firm, for example, you might assess how long it takes to: qualify a prospect in or out, land an initial first meeting, develop a proposal, get that proposal delivered, and help the prospect reach a decision.
Then, assess how many active high-value prospects there are at each step in your process, the value of opportunities in your pipeline overall, and the cost of your team's time in closing sales.
External Vantage Point: Track your customer retention, as countless studies support how markedly less expensive it is to retain a client versus attract a new one. Monitor annual customer spend and satisfaction as gauges of basic loyalty, as well as referrals generated by existing customers as the ultimate litmus test for even higher loyalty levels.
Consider hiring a research firm to survey your current and past customers to ask them how you stack up against your competitors and what percentage of category spend your firm is receiving versus your competition.
Survey prospects and the broader marketplace to determine how your brand stacks up against competitors on each of your key differentiators and what's preventing prospects from doing business with you. Price shop your competitors and be sure to include your rates and theirs on your dashboard. If you are in a B2C (business to consumer) industry, consider including customer sentiments reflected via third-party review and social media sites; there are numerous web-based tools which can provide these metrics.
Incorporate selected metrics into the overall growth dashboard for your firm and review it regularly, compared to prior time periods, with your sales and marketing teams collectively. Be nimble and prepared to flex your strategy based on the findings.
Lori Turner-Wilson can be reached at www.redrovercompany.com.