Apr 19, 2022
Well, do you?
You can’t improve rep performance without a baseline. And all too often, even sales organizations that regularly analyze key performance indicators (KPIs) aren’t even tracking the right metrics.
Having clear goals and expectations allows you to gauge everyone’s performance and adjust your training and coaching approach as needed. Continue reading to discover the most important metrics for sales success.
Setting your sales goals
First, you must consider what your goals are — for individual reps, teams, and even leadership. Have a new product you’re trying to push? Want to reduce the average length of your sales cycle or drive better content engagement? Make sure these goals are SMART (specific, measurable, attainable, relevant, and time-based) to better measure success.
It is more effective to set these goals and then work backward to establish KPIs that will progress reps toward these outcomes, rather than determining metrics prior to goal setting.
You’ve developed objectives for where you want sales reps to be — now you must set a plan to help them get there. Many sales organizations simply measure everything available even when these measurements don’t provide relevant insights.
The metrics below aren’t reliable indicators of seller success:
- Conversions: The number of new leads who turn into customers
- Email engagement: The number of opens, reads, and link clicks within an email
- Sales activities: The number of cold calls made, number of demos performed, number of emails sent, training completion, etc.
- Total appointments booked: The number of prospect meetings scheduled
- Total pipeline value: The potential revenue generated if all deals in the pipeline close
What do these metrics actually tell you? Do they give you any insight to act upon?
Use these actionable metrics instead
Numbers don’t have much meaning without context. Trade vanity metrics like the ones above for indicators that directly correlate to performance and provide insights that allow for improvement.
Conversion rates put the number of conversions into context. For instance, when analyzing sales performance, seeing that 15 customers converted within a quarter doesn’t mean much when you don’t know how many leads you started with. Knowing that 50% of leads converted, on the other hand, allows you to compare against your benchmark and understand whether you need to reevaluate your approach.
Engagement rates are similar to conversion rates in that, rather than providing an arbitrary number, they demonstrate how many people opened an email or clicked a link within that email out of the total number of people who opened it. The standalone number may seem low, but the percentage allows you to take more effective action. If you have a great open rate but your clickthrough rates are low, you need to work on content and calls to action.
Average time to close indicates just that: the average length of a sales cycle across your team. This is a far greater way to gauge performance than whether reps completed training and how they scored. However, looking at these training metrics next to time to close gives insight into how your learning materials contribute to elevated (or lowered) performance.
Deal losses are not necessarily a fun metric to view but are still significant barometers of performance. By understanding why a deal was lost, where the deal was in the sales cycle when it was lost, and other details of the process, you can identify areas for improvement.
Win/loss ratio goes beyond losses to measure how many appointments are actually closing. One of your reps may be setting a high number of meetings, but if a small percentage of those close, it’s a strong signal that something in your process needs to change.
Don’t completely count out vanity metrics
All of this isn’t to say that vanity metrics aren’t important. You should continue capturing them to measure growth over time and to put other performance indicators into context. For example, by looking at which sellers are closing the most deals and identifying any trends in their activities (they make more calls, schedule more appointments, complete more training modules), you can replicate those behaviors and incorporate them into your coaching or training materials.
To set sellers on a path to sales readiness, start by building an ideal rep profile (IRP), which sets a benchmark for these performance indicators. Learn more about what an IRP is here and get started building yours today with Mindtickle’s new IRP generator.