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Every step of the sales process tells us something—everything from how a salesperson approaches a new lead to how many clients renew their contract. But often when sales teams are evaluating their strategy and performance, they are looking too far into the sales process, like when a lead is ready to be converted, rather than early-stage indicators that can have a tremendous effect on a company’s bottom line. Here are four Key Performance Indicators to implement in your sales strategy:
When looking to garner new business, your sales and marketing teams are likely in cahoots. The collaboration between the two departments will ensure marketing dollars are only being used on quality sources. It can be assumed that sales teams are focused on their rate of conversion from leads to clients. Similarly, they’re likely considering just how long this process takes. But what may be even more important—and indicative in the ROI and speed rates—is the quality of the leads. It’s possible that the marketing team is focusing their energies on sources that are delivering slow, indecisive, and possibly unfit leads without realizing. By comparing the ROI of leads to the pace at which this occurs (or doesn’t occur), a salesperson will be able to distinguish the quality of the leads they’re receiving. This has a direct effect on the salesperson’s overall performance.
The speed it takes to close a client is not the timely performance indicator. When leads are given to a sales team, the speed at which they contact their leads is a key factor in closing a deal. If the initial speed to contact is slow, a salesperson is giving competitors the opportunity to swoop in and steal potential business. Salespeople who have a faster speed to contact are indicating their commitment to success and interest in exceeding goals previously set for them. Someone with a slow speed to contact leads may signal to a manager that sales is not the right fit for them.
Do you know how your sales team is pitching new clients? Do you care? Well, if the numbers of new clients are meeting your goals, you may start to care. Clients want to feel special and appreciate an individualized experience. Encourage your sales team to spend a little time getting to know their leads and pitch them on a more personal level. The businesses you’re pitching are likely receiving sales calls and pitches regularly, so you’ll want to stand out. If a salesperson repeated has a low ROI, question whether or not they are sending out proposals that focus on a lead’s needs or canned emails that reek of laziness.
Leads are great indicators for new business, but what about current accounts? A focus on booked revenue from a business that’s adding on to their existing contract or renewing their contract is equally as important. High turnover or stagnant clients is a serious red flag. Looking at current clients, it’s important to consider the length of their tenure and any adjustments to their contracts (good or bad). If your average client stays with the company for one or two years and they drop off, reevaluate the customer service and attention paid to repeat customer. This can increase revenue twofold—first by keeping a particular client on board and second by recommendations from satisfied clients. Ensuring that the helpful and ongoing level of service does not discontinue shorty after a client begins a contract will increase booked revenue. Whether you’re concerned about lagging sales or simply want to motivate your sales reps, tracking KPIs will yield positive results for your team. Utilizing a KPI dashboard that tracks and measures employee results in real time will make sure small problems do not become bigger ones and that small wins lead to larger ones.