Ask any sales manager what comes to mind when they think of sales success metrics, and their answer will likely be the same: Revenue. Of course, revenue is the foundation of your team’s success. But, if you focus too much on revenue, you may miss out on other important metrics—metrics that complete the picture of your sales team’s performance.
If you’re looking for more sales insight, keep reading! We’ve put together a list of seven important metrics that will tell you more about the buyer’s journey, the productivity of your sales team, and much more.
1. Length of sales cycle
Average sales cycle length measures the time between your first point of contact with a prospect and when a deal closes. Length of sales cycle is key to your sales forecasting efforts because it allows you to gauge how long it’ll take the leads in your pipeline to close, and thus predict your upcoming sales figures.
Although forecasting is important, length of sales cycle provides other valuable insight into the sales process as well. This metric can help in the following areas:
- Obstacle Identification: Where along the sales cycle to your reps get tripped up? Where do prospects tend to go silent? When you analyze your average sales cycle you can identify and remove any obstacles—obstacles that you may have missed otherwise.
- Performance Assessment: Take a look at how long it takes each of your reps to move a prospect through different stages of the sales cycle—then offer training to improve the areas in which your reps seem to struggle.
- Resource Allocation: On its own, the average length of your sales cycle won’t tell you much, but when you start to compare and contrast length of sales cycle based on team, lead source, season, etc.—you can prioritize resources accordingly.
Win-rate refers to the percentage of created opportunities won by your sales team. In simpler terms, win-rate tells you how successful your sales reps are at turning opportunities into sales. Calculate win-rate with the following formula: (# of closed-won opportunities) / (total # of open opportunities) = Win-rate.
To improve a low win-rate, start by looking at what stage in the process the sales rep is failing to convert opportunities. If they consistently lose sales early on, they might need to develop skills like trust-building and establishing product value. If their struggles begin in the later stages of the deal, they might need to improve their ability to handle objections and negotiate.
Of course, there are many factors that influence win-rate, so it’s important that you examine it alongside your other metrics. Look for correlations before assuming a poor win-rate is an individual performance issue.
3. Time spent selling
Did you know the average sales rep spends only one third of their day selling (source)? You read that correctly. The rest of the time is spent on menial tasks like reading and writing emails, prospect research, and entering information in your sales contact database.
As a sales leader, it’s important to understand where your sales reps spend the most time. The easiest way to do this is to have your sales reps track their daily activities within a certain time period. Then, analyze their responses to determine what they spend the most time doing, how they can streamline their processes, and of course, how to improve sales productivity.
4. Average deal size
Average deal size is the average amount a customer pays per transaction. This metric gives you important insight into revenue generation and also allows you to quickly identify deals that fall outside the range of ‘normal’.
For example, let’s say your average deal size is $10K. Today you have a $90K opportunity enter your pipeline. From experience, you know that deals of this size often take longer to close and tend to fall through more often than smaller deals. Because of this, you hop on the rep’s calls and make sure things go smoothly.
As with length of sales cycle, it can be helpful to look at average deal size by rep, lead source, time of year, and more. Doing so can tell you which reps are better at upselling, which channels generate the biggest deals, and what time of year people spend the most money on your products.
5. Lead response time
Lead response time refers to the amount of time it takes a sales rep to follow up with a new lead. This is a vital metric to track, because, statistics show a correlation between closed deals and lead response time. Consider these statistics (source):
- 35% to 50% of sales go to the vendor that responds first.
- The odds of successfully contacting a lead are 100 times greater if you reach out within five minutes of the lead being submitted, compared to 30 minutes.
Yet, despite these statistics, the average lead response time of B2B companies is 42 hours. As a modern sales professional, it’s important to acknowledge that the sales cycle has changed. Most of your prospects are well-researched by the time they reach out to you—and we hate to break it to you, but they’re often looking at your competitors, too. For this reason, it’s critical that you’re the first to respond.
The best way to measure lead response time is to work with sales enablement tools and technology providers to see if they offer this capability. But, a much simpler method of gauging lead response time is to submit a test form with real contact information, and then observe how long it takes for your reps to reach out. Although one test submission isn’t enough data to build a strategy off of, it does give you a general idea of lead response time.
6. Sales by lead source
It goes without saying – you should know where your closed deals come from. Tracking which platforms and campaigns bring in the most leads, allows you to allocate resources and money to those sources.
Ideally, your sales will come from a diverse set of lead sources. If one source is bringing in the vast majority of your sales, you’re more at risk. If usage of that platforms declines, your leads may drop off significantly. Having several healthy sources of leads alleviates the chances of a sudden dip in sales.
Keep in mind, for this metric to be useful, you must have strong inter-department communication and complete marketing and sales alignment. When you provide feedback about which campaigns result in the most sales, they’ll know how to adjust their strategies– and the results will benefit both departments.
7. Quota attainment
Quota attainment is the percentage of sales reps that meet or exceed their quota. Quota attainment is a valuable metric to track the performance of individual sales reps as well as your team as a whole.
If a very low percentage of your sales team meets quota, you must determine why. Have you set expectations too high? Do you need to restructure commission rates? Improve your training? There are many reasons why your sales team might miss the mark, so don’t rush to assume that they’re not high-quality employees.
If almost all of your reps consistently make quota, however, then you should consider setting your goals higher. Slightly more aggressive quotas motivate reps– remember, most salespeople are inherently competitive!
These seven metrics are only a small sample of the data and analytics available to most sales professionals. However, they illustrate the importance of looking beyond the more obvious revenue and growth metrics you’re already tracking.
Revenue and profit metrics tell you how successful your company is. But, when you dig deeper with metrics like the ones mentioned in this article, you’ll gain valuable insight into how you’ve achieved success. Using that insight you can scale your efforts to become even more profitable.
About the Author: Sam Holzman is the Content Marketing Specialist at ZoomInfo where he writes for their B2B blog. ZoomInfo is a leading B2B data provider that helps organizations accelerate growth and profitability. Sam regularly covers topics related to sales, marketing, and recruiting and likes to write about sports and travel in his free time.