Sales performance metrics tell the story of your business and its role in customers’ lives. These metrics don’t just empower your sales team and help them improve; you can also use this information to increase visibility for planning and reporting.
Once you’ve started using metrics to track sales performance, there’s only one question: How do you use those metrics meaningfully? Fortunately, there are several best practices for tracking and analyzing this information.
Here’s a look at the five most important types of sales metrics and how to use them to your advantage.
- What are sales metrics?
- How to choose the most important sales performance metrics to track?
- 5 most important types of sales metrics
- The importance of tracking and analyzing sales metrics
- How technology can help?
- Mindtickle helps you make the most of sales data
Sales metrics are data points that represent the performance of an individual salesperson or a full sales team. Management and other leaders use different types of sales metrics to track progress, identify issues and prepare for future growth.
Sales management metrics aren’t just for visibility. They’re also a great way to incentivize sales teams to hit targets consistently. Sales leaders can use metrics to fine-tune training and make any necessary adjustments to individual learning, contributing to better overall performance.
Essentially, sales performance metrics aim to steer sales teams in the right direction. This information helps identify problems in the sales process, grow revenue, and increase competitiveness in today’s marketplace.
Different businesses need to track different types of sales metrics. It’s up to you to decide which are most important for your industry, customer base, and individual teams — but it’s always smart to keep these ideas in mind:
- Have a goal: Every tracked metric should have a purpose, such as supporting sales enablement or providing insight into your sales onboarding process.
- Unite your data: Sales metrics don’t exist in a vacuum. Ensure they work together to create visibility into your entire sales process and customer journey.
- Skip the vanity metrics: Vanity metrics, such as views or attendee numbers, don’t actually contribute to your sales performance or revenue. Don’t get too caught up in this information.
- Stay consistent: You don’t have to track the same metrics all the time, but always use a single method for tracking and recording data so your numbers remain consistent.
- Learn: When choosing which sales metrics to track, remember that you’re supporting your sales team, sales forecasting, and more. Learn from your data and put those insights to good use for your business overall.
Since there are a plethora of sales metrics available, it can be difficult to figure out which ones to track. Let’s take a closer look at five of the most important sales metrics:
1. Sales KPIs
Sales KPIs are connected to company-wide goals or objectives, which means this data allows organizations to measure overall performance. Managers often depend on sales KPIs to make informed business decisions. That’s because sales KPIs help identify key gaps related to product-market fit, sales team efficiency, and more.
The most important sales KPIs include:
- Customer lifetime value (CLV): The amount of money a customer will spend during their entire relationship with your business.
- Revenue from new customers: The revenue you get exclusively from new business or first-time buyers.
- Revenue from existing customers: The revenue you earn from up- or cross-selling to current or previous customers.
- Year-over-year growth: Your sales performance compared to the same time period last year.
2. Hiring and onboarding metrics
With the right hiring and sales onboarding observations and metrics, managers can fine-tune job descriptions and reduce the risk of future hiring mistakes, which can cost a great deal of time, money and headaches down the road. Sales leaders will also have valuable data that informs them of when and how to recruit new candidates.
The top hiring and onboarding metrics include:
- Sales ramp-up time: Average time for new sales representatives to be completely productive.
- Productivity: The ratio of sales to quota capacity, and the actual monetary impact of an increase or decrease in this productivity.
- Retention: The number of new hires who stay with the company.
3. Training and coaching metrics
Without a strong sales enablement strategy, it’s nearly impossible to create and maintain a successful sales team. Therefore, training and coaching metrics are invaluable to those in sales, marketing, management, and just about anyone else involved in sales enablement.
These metrics include:
- Efficiency: Time spent on training compared to time spent answering team member questions during sales processes.
- Satisfaction: Sales representative satisfaction and engagement during onboarding, training and coaching.
- Manager effectiveness: Quality of interaction in shadowing, ride-alongs, 1:1 reviews, two-way feedback loops, and more.
- Cost of training: Average cost per sales representative in both money and time.
4. Outreach metrics
If your sales representatives focus on closing deals via phone, email, and social media, outreach metrics can be very beneficial, particularly when tied back to training content (learning) and skill-building activities (practice). Managers and trainers can use them to determine which outreach methods require greater attention.
- Open rate: How many customers open an e-mail.
- Response rate: How many customers reply directly to an e-mail.
- Engagement rate: How many customers click a link or otherwise engage with content in an email.
- Call-backs: Percentage of prospects who call back to follow up.
- Conversations: Percentage of prospects who agree to talk with your sales team.
- Conversions: Percentage of prospects who move to the next steps.
- Requests: Percentage of LinkedIn connection requests accepted.
- Interactions: Number of likes, shares, and comments on social media posts.
- Meetings: Number of meetings set through social media.
- Opportunities: Number of qualified opportunities generated.
5. Pipeline metrics
Through pipeline metrics, sales managers can gain a thorough understanding of their success throughout the entire pipeline. They can also provide insights into how their organization is dominating the market and what kind of demand there is for their products or services.
The most important pipeline metrics are:
- Sales cycle length: How long it takes to move from prospect to customer.
- Sales per rep: How many sales each representative makes in a given time period.
- Sales by region: How many deals are closed in each area.
- Average deal size: Average amount of revenue per sale.
- Churn rate: How many customers are lost in a given time period.
- Quota attainment: The average percentage of quota completion.
By making it a priority to track sales performance metrics, sales-driven organizations can:
Better optimize the employee experience
There’s a direct correlation between employee experience and customer experience. By tracking and analyzing sales metrics, organizations can gain valuable insight into what is working for their employees and what isn’t.
Provide insightful training feedback
While sales leaders can ask their new sales representatives how they feel about their training, the answers likely won’t be thorough enough to accurately gauge how they’re doing. With sales metrics within reach, however, teams can figure out exactly how effective their training program is and where they need to improve.
Increase customer retention
Retention efforts increase customer lifetime value and boost revenue as a result. To increase customer retention, sales representatives must engage existing customers to continue to buy an organization’s products or services.
There are a number of sales metrics such as customer churn, time between purchases, and loyal customer rate that can give sales leaders and the management team a close look at how well their organization is retaining clients.
An analytics interface is one of the easiest and most effective ways to track and manage key sales metrics. When shopping around for sales enablement analytics software, organizations should be on the lookout for the following important features:
- Real-time alerts: An interface should offer data on real-time changes in the market.
- Filters: Whether it’s a high-level view or a highly specific look at particular metrics, filters should allow you to customize your parameters for any given goal.
- Sharing: Data, tools and tasks should be easy to share via email for internal parties or through public URLs for external users.
- Collaboration tools: Dashboards should allow users to make comments, share key metrics and create slideshows. Automation features such as report scheduling and program notifications are important, too.
It’s one thing to find a sales metrics example that resonates with your team. It’s another thing entirely to use that sales metric to your advantage — and to combine it with all the other data you have at your disposal. You need a way to keep this information in one platform — a shared workspace that sales teams and other departments can access, contribute to and utilize at will.
Mindtickle is a sales readiness platform designed to help you understand and quantify the strengths and weaknesses of your sales team, then take data-driven steps to improve sales capabilities. With Mindtickle, you can leverage built-in reporting and analytics to measure seller effectiveness and track progress against KPIs.
Request a demo today to learn more about how Mindtickle helps you track sales performance and all different types of sales metrics.
This article was originally posted in April 2020 and was updated in March 2023.