9 Key Sales Metrics You Need to Track to Stay Competitive
Tracking your sales metrics can do a lot to improve your efforts. A vigilant watch on the sales metrics facilitates evaluating and forecasting performance of the sales team. Consistent and accurate tracking of sales metrics helps to spot and identify any leakage in the sales funnel. This helps to enforce any improvement needed in the sales efforts.
Thus it’s clear that sales metrics and their tracking holds a very high place when it comes to increasing the performance of your team. Here are ten metrics you need to be tracking to stay competitive.
Sales Cycle Length
This metric will help to identify any loophole or any time wasted on a particular deal. And on the other hand, if a particular deal is closed within a short period the sales representatives can take tips from the same. These tips can be utilized to close further deals quickly and efficiently.
Also, there many tools available which help SDR to reduce sales cycle time, increase closure rate & ultimately revenue. Tools like SalesHandy collects such behavioral insight and presents them in an actionable format.
A track of closed opportunities, whether won or lost, should be maintained. This metric should be compared with the open opportunities available. This comparison will help to acknowledge the working of each sales rep individually. Any loophole in their undertakings can be pointed out and can be rectified.
It is of utmost importance to track the open opportunities available to the sales team. This consists of the number of prospects put forward by the marketing team. If the sales team gets overloaded with open opportunities, they may waste time in convincing a number of prospects to buy the product.
Concentrating on quite a number of prospects they may end up in closing the deal with none. And on the other hand if this open opportunity rate goes down they may not have enough prospects to convince thus resulting in lower rate of closing the deals.
The lead response time refers to the time period elapsed from receiving the lead idea and contacting the lead by the sales reps. A short least- response time is the key to success. It is always advisable to be quick, as there are a number of competitors in the market.
If your sales reps are a bit slow to reach the leads, some other company might reach the lead and convince them to buy their product.
The win rate can be calculated by summing-up the number of closed and win opportunities and dividing it by total closed opportunities (won + lost).
For example, David Miller’s closing rate from his sales is 10 closed-won opps divided by 60 total open opps = 16.66%. Evaluating the win rate metrics will reflect the quality of reps regarding the closing of deals. A track can be kept of the representatives not being efficient and measures can be taken to improve them. Proper measures can be provided to them by identifying the reasons for their lacking behind.
The reach rate, also referred as rate of contact, is the percentage of outbound opportunities (calls,emails, etc.) resulting in a meaningful conversation with a decision maker. A good team is one which can generate around 32 opportunities out of every thousand call/ email sent.
Listening to sample recordings is a good practice. A track should be maintained for every email sent. If the team is not able to close sufficient deals through these outbound opportunities, it reflects that changes and improvements are needed.
The size of the deal closed always matters. It may happen that a sales rep has a high rate of closing the deals but the size of deal is considerably low. This will affect the total revenue received by the company in the long run. The sales reps sometimes are reluctant to crack the deals with higher size as it takes more time and efforts.
They might also be afraid of failure. Small deals are always easier to deal with, comparatively. So it is always important to keep a track of the size of the deal closed.
Cost Of Sales And Revenue
The motive of every company is to earn more profits. A comparison of cost incurred for sales to the total revenue derived should be made. Total cost of sales include the salaries, commission and any other expenses on the sales organization.
This will help to keep a check on any wastage of the available finance and the total revenue of the company can be increased in the long run.
Time Utilized For Selling
Many times, representatives do not utilize the total time for which they are paid for. Thus they become a burden on the company resources. Track should be maintained about the time utilized by each one of them for a particular deal. Any negligence or loophole on their part can be questioned and sorted out.