As a company, you probably want to scale your business, beat the competition and maximize your profits. And the sure-fire way to do this is by boosting the efforts of your sales teams. But how do you efficiently track your sales team’s efforts to assess what works, what doesn’t, which areas to improve and which to scrape?
The Global Data Management Benchmark Study for 2018 showed that 52% of the companies surveyed said that soon, data and analytics would be a primary source of competitive advantage. And as more companies rely on their tactical decision-making data, their ability to extract actionable insights will be crucial to success.
We know that to make critical decisions and assess performance, sales data is a requisite. Though most companies understand that data is their genie in a magic lamp, they fail to realize that when it comes to data, more isn’t always better. And having innumerable sales metrics or KPIs don’t drive their teams to do better, but in actuality may diminish efforts.
So, to avoid burdening your sales team, you need a sales dashboard that’ll carry only the most important sales metrics.
What is the sales dashboard?
A sales dashboard is a visual depiction of your sales team’s data.
Popular sales metrics that are tracked include attainment of quota, conversion/win rate, size of the average contract, revenue, sales funnel leakage etc.
They offer an overview of the key performance indicators (KPIs), which show you how your sales team is doing in relation to the company’s expectations and targets. Sales leaders also use these metrics to measure success against targets, take executive decisions, adjust compensations, allocate benefits and identify challenges.
It’s an effective way to keep your sales and your priorities organized and continually updated.
What metrics should you track?
Irrespective of your company’s unique needs, specific metrics are universally applicable. You won’t know the health of your sales without these data points, like how you can accomplish your targets, or whether you need to speed up or slow down the sales process.
On the other hand, there are unique sales metrics that are necessary for your sales. For instance, some sales may require several lengthy phone calls to get a contract signed. Others require meetings in person. Closing more significant accounts may take more support than smaller ones. And some small and mid-size business owners may be stalwarts of the conventional way of how things are done and may require lengthy customized customer journeys. So, your sales metric dashboard would need to be tailored to the needs of your company and your customers.
To assess which metrics you must track, consider these questions:
- In your reports, which data points and metrics occur most often?
- Are there specific metrics that your sales teams view as more important than others?
- What are your key performance indicators (KPIs) for this year?
- Do you have different sales teams, such as sales inbound sales, field sales etc.?
While building your sales metric dashboard, take inspiration from dashboard samples online. It’s crucial to ensure that actionable metrics are included on the dashboard. A few data points and metrics would be evident, and for the rest, you can consider your sales reports.
Remember, every sales metrics dashboard needs to be modifiable. With changing sales processes and goals, your dashboard is likely to change over time, so you’ll need a dashboard that’s easy to change and modify and doesn’t require IT help.
Building your sales dashboard
When it comes to your car, important data such as the speedometer or the gas gauge isn’t hidden somewhere in the corner but is positioned front and centre. Similarly, the most vital metrics of your sales dashboard should take precedence.
You need to be able to adjust how metrics show on the dashboard so that the most relevant data is most noticeable. This is applicable for both mobile and desktop dashboards.
When it comes to building your sales dashboard, you need a clear vision of what you require. A few things you should consider are:
- The dashboard’s purpose
- Who will see it?
- How often will it be seen?
- What should it look like?
- How much data it contains
- The period
- Preferred chart types
You aim to present data in a manner that is easily understandable and to ensure that the dashboard works in real-time. You can do this by using a CRM software which’ll help your sales team view and analyze the dashboard. Bear in mind that your dashboard needs to be mobile and device friendly. We wouldn’t want your sales team struggling when they’re on the move, would we?
With that out of the way, let’s move onto the most critical metrics for sales teams.
Important sales metrics for your sales dashboard
Whether you’re a sales manager looking to boost the performance of your sales team or a sales rep looking to get that fat bonus check, you need to understand the most important metrics and KPIs for your company, why they matter and how you’ll track them.
In this article, we’ll cover 15 important metrics and KPIs used by successful sales teams around the world to convert prospects to leads and seal those deals. Depending on your requirements, you can pick and choose the most relevant metrics.
Sales metrics vs Sales KPIs
Before we proceed, you’ll need to understand the difference between sales metrics and sales KPIs.
Sales metrics are data points that, reflect the sales performance of a salesperson, sales team or company.
Sales KPIs, or Key Performance Indicators, are particular sales metrics related to one or more company-wide targets, priorities, or goals.
Although these data points may sound similar (and people interchangeably use sales metrics and sales KPIs), they have a few key distinctions.
A sales metric is a standalone metric. It shows you what has happened in numbers. Whereas a sales KPI tells a story. It’s a metric attached to a goal that can be much easier to act on.
For example, if you’ve launched into a new market and want to see how you’re doing, you may want to monitor sales by region. Sales by region are by definition, a sales metric. But when used in a new market to track and optimize the performance, it becomes a sales KPI. It showcases your progress towards reaching the company’s goal.
Now, that we’ve covered what sales, KPIs and metrics are, you’re probably pumped to see which metrics and KPIs would best suit your needs. But hold your horses, let’s revisit the golden rule.
“You don’t need to monitor every sales metric or KPI. You just need to monitor the right ones.”
If you’re staring at a sales metric dashboard full of numbers and charts and have no idea how they apply to each other or how to make sense of it, you’re in deep trouble.
How do you choose the right sales metrics for your sales team?
When it comes to sales metrics, there is no one size fits all solution. The sales metrics you decide to track will depend on your goals. That means what’s best for you isn’t going to be what’s best for someone else. So, you’ll need to choose metrics that help your sales team and push them to do their best work.
With that in mind, here are the top 15 high performing sales metrics.
1. Leads by source
This sales metric helps you understand where your leads are coming from.
It helps you assess where the majority of your leads are coming from? Are they from conventions, trade show, booth sessions, demo sign-ups, or referrals? Was it because of field marketing, outbound marketing etc.? This data allows you to determine which leads are the most profitable, which leads to contact first and how much to invest in each lead.
It also helps sales reps see whether their lead sources need to be diversified so that they aren’t solely dependent on one or two resources.
2. Lead conversion rate
This sales metric helps you assess how many of your leads are getting converted to sales.
Although there are several ways to segment further this metric, a high-level analysis of your lead conversion rate is an important performance metric for your entire team. By tracking the lead conversion rate, you’ll be able to devise strategies for future customers. You can do this by working backwards and following the funnel to see where the leads fell through and why you couldn’t convert them.
It also helps answer important questions about the sales process like:
- What’s the ratio between prospects contacted and converted customers?
- When did the qualified prospects in your funnel fall off?
- Are you following the correct leads?
Using this metric, sales reps can evaluate the efficacy of their pitches and adjust it for future leads.
3. Calls and emails per rep
This sales metric helps you understand what your sales reps are doing to bring in more leads. Bringing in leads begins with talking to them. It monitors the number of calls and emails made over days, weeks and months.
In addition to informing you about how involved your sales reps are they also specify if there’s something wrong with the sales funnel. For starters, using sales benchmarks such as the 30/50 rule for cold calling and emailing, you can pick apart your sales funnel and assess which areas you need to adjust and optimize. Or you could decide to maximize your reach rate for your team, and therefore look for a CRM with an inbuilt predictive dialler.
Sales managers and directors make use of this metric to track their team’s productivity.
4. Lead response rate
This metric measures how quickly your sales reps respond to inbound leads. The longer it takes for your sales team to respond to leads, the higher the chance of them walking away.
Consider this: if a prospect is looking for a solution and approaches you, you’re certainly not the only business they’ve reached out to. So if you take 24 hours to reply to a lead, they might’ve chosen one of your competitors, lost interest or maybe even changed their mind.
This is an important metric for sales reps, especially in B2B companies, because the quicker they respond, the more likely they’re to convert that lead to a customer.
5. Sales opportunities generated
No matter how many calls and emails your reps make, it won’t matter if your leads aren’t interested in what they’re offering. This sales metric tracks the opportunities that your sales reps are generating. This helps you understand which opportunities are worth pushing, which leads are ready for your pitch and can be converted to customers.
Using this metric, your sales reps can gather useful information about the sales process, such as
- Are their attempts at outreach working? Compare the number of opportunities generated to the number of emails/calls per rep.
- Are they contacting the right people? Compare the expected purchasing value to the number of opportunities.
- Is their pitch successful? Compare the number of opportunities generated to the number of trials initiated.
Sales managers use this sales metric to assess the health of the sales funnel and make decisions regarding their overall sales process.
6. Monthly sales growth
This sales metric measures the increase or decrease in revenue from sales. And while it’s one of the most meaningful metrics that you can measure, you need to make sure that you look at it appropriately.
Using monthly sales growth as a sales metric provides you with actionable feedback that you can use to improve your sales processes, strategies, and product goals.
Although annual sales revenue seems to be more relevant for monitoring the company’s health (particularly for SaaS companies), start-ups can’t afford to wait that long. Instead, they might need to track sales growth month-on-month.
Sales managers use this metric to monitor the results of their efforts to see where their sales funnel needs to be modified. And the monthly sales growth can also serve as inspirations for sales reps.
7. Monthly on boarding
Not every lead gets converted to a customer. Particularly for SaaS companies, it’s most likely that your product will do some of your selling. This sales metric records how many trials or demo calls your sales reps have set up.
This metric is crucial when it comes to closing deals. Leads who sign up for trails or request for demos are more likely to convert and become customers. So tracking this metric helps you understand the health of your sales funnels.
This metric is beneficial for both sales reps and managers. For sales reps, it offers them insights into their actions, and sales managers can use it to plug gaps in their sales process and funnel.
8. Average conversion time
How long does it take you to convert a lead?
This sales metric provides insight into the sales funnel’s productivity so that you can make decisions on how much time and effort you want to put into closing a prospect.
Time is of the essence. And if you’re offering a $9/month SaaS product, but it takes up to 6 weeks to seal that deal then you’re going to lose that deal. When looked at in combination with the other sales metrics, we have listed (such as lead conversion rate) this metric gives you a better view of your pipeline and assesses whether you’re on track to meet your sales goals.
Sales managers and sales reps can use this metric to predict revenue, get funnel insights, and follow-up with leads.
9. Customer acquisition cost (CAC)
How much does the acquisition of a new customer cost?
This sales metric records all the costs involved with getting into a new customer. And while it might sound easy, it can get complicated fast.
Let’s say you use Facebook ads, to push customers to a landing page for them to sign up for your service. If your campaign cost is $15 per lead but ends in a sale of a $20+/month, you’ve got yourself a winner.
Let’s assume you’re a SaaS business with a 60-day average conversion period and an inside sales team. To calculate your CAC, you’d need to include salaries, associated costs, overhead and money that you spend on tools. Then divide it by the number of leads you have. Using this metric, you can assess which sources are worth your time.
Sales directors often use this metric to help devise sales processes that are scalable and will bring in profits.
10. Customer lifetime value (CLV)
Once you’ve acquired a customer, how much are they worth?
Using this sales metric, you can measure the revenue you’ll receive from a customer from a moment they start paying you to the moment they’ll stop.
Much like customer acquisition cost, measuring CLV isn’t that simple. There are numerous models used to explain CLV, yet every model will require a large sample size. CLV helps you to forecast the potential revenue and profit for your company. You can’t make assumptions about how much to time and money you should spend acquiring customers (CAC) without knowing their worth.
Sales representatives and managers use this metric to understand the overall health of the company (or a particular product) concerning revenue and customer retention. A rising CLV means that you’re doing well while a falling CLV means you need to change things up.
11. Customer churn value (CCV)
How many customers are you losing?
This sales metric represents the number of customers who have stopped using the products or services of your business within a specified time frame.
It provides a realistic overview of your customer engagement strategy and what kind of issues you’re grappling with. To calculate the CCV, you can divide the total number of customers who started using your products or services at the start of the month by the number of customers you lost. The higher your churn rate is; the more business you’re losing.
Sales directors, executives, use this sales metric, and the C-suite to track the overall health of the company. Looking at your churn rates from a sales perspective can help you discover better prospects (who are more likely to stick around).
13. Sales targets
What is the ultimate target of your sales team?
This sales metric compares closed deals over a while and is a great way to encourage your sales reps.
However, when it comes to establishing sales targets, context is incredibly important. No one wants to sound like they’re under-performing all the time. And a fast road to burnout is continually pressing the sales team to meet unreasonable sales targets.
This sales metric provides you with real data that you can use to set reasonable future goals that inspire your team.
Sales managers and directors often use this sales metric to set sales targets, but it’s also used every month by sales reps to measure their growth and productivity.
14.Sales by region
Where did all your sales come from?
To tell you which markets are most responsive and valuable, this sales metric monitors sales by particular regions.
Any great sales process starts by knowing who the perfect customer is. And where they live is a big part of it. You may also segment this data further to measure sales by demographics (age, class etc.) and other factors to help you better understand your ideal customer.
This sales metric can be used by sales directors who develop the overall sales plan to see how particular campaigns are doing and assist sales managers in optimizing their targets.
15. Product performance
If you’ve moved beyond selling a single product or service, you’re bound to have some that do better or worse than the rest.
This sales metric ranks the revenue performance of your products and services so that your sales team can see which ones are reaching the mark and which ones are missing it.
But note, it doesn’t make sense for a business model to judge the value of a product strictly by revenue performance. A low price yet high volume product or service, for instance, could make up a decent chunk of your revenue but not be in the top 3 in terms of revenue. When tracking product performance over time, you get insight into market changes, your sales strategies and overall health (and desirability).
To adjust their sales process and emphasize more or less on particular goods and services, sales managers use this sales metric. Sales executives and the product team also use it to assess whether a once-popular product is losing its charm.
Sales rep productivity and leader board
At Sloovi, we believe that to give your sales team the best chance at succeeding; you need to equip them with the best tools. The more tools you offer to motivate them to do their best job, the more revenue they’ll bring in.
This sales metric measures the effectiveness of each sales rep. It also allows you to see how your team is doing and create some friendly competitiveness to motivate your sales reps.
Sales reps aren’t purposely trying to do a lousy job. But it’s impossible to know what they need to focus or improve on without insight into how they’re going. What’s more, many sales representatives are competitive by default, and a little friendly rivalry with other members of the sales team will motivate them to perform better.
Sales managers use this sales metric to track their team’s performance and see who needs extra help. It’s also used by sales representatives to assess their productivity and to see how it compares to the rest of the team.
By now, it’s obvious how important data is. And what you don’t measure, you can’t manage.
The days of guessing games are over. Without an understanding of data, it isn’t easy to be competitive today. Sales indicators and KPIs provide you with concrete data on what your team is doing so that you can make better choices, refine your process, and close more sales. But they work only if you’re using them correctly.
When you head on the road to set the team’s best sales metrics, remember to:
- Pick sales metrics that are actionable and represent the strategies, goals and expectations of your company.
- For your company style, team size, position, and industry select the correct sales metrics
- Track KPIs and metrics for sales using a precise, actionable tool
Sales KPI tracking and measuring isn’t a guaranteed road to growth. But without these metrics, you’re a lost traveller without a compass.