How can Sales Performance Metrics and indicators help you and your business sell better? It’s very simple, these metrics allow you to analyze and monitor the performance of key areas that allow businesses to hit their sales targets quicker, within the parameters of your company’s overarching strategy.
Sales performance metrics range in type and also in what they analyze, calculate your sales efficiency, measure your rate of customer conversion or find out the number of sales to customers concluded after prospecting. These indicators can be qualitative or quantitative and are numerous and diverse.
Following these metrics in a sales performance dashboard, thanks to a CRM software, could help you, your team, and your company adapt the management of your sales department and develop a better and more profitable sales strategy.
But, with so many options out there, how do you choose which sales and marketing metrics to use to boost your performance? Which digital tools does your company need to perform better?
What are Sales Performance Metrics?
To start, sales performance is the reflection of indicators/metrics “in the green”, meaning successful figures that have helped your company grow, such as:
- Number of Sales - how many sales of a certain product or service your company has made in the past year or month.
- Average Amount Spent per Sale
However, performance isn’t exclusively linked to positive numbers, figures, and deals, knowing how to respond to the needs and wants of your customers by offering them a satisfying product or service of value is the other side of the coin of performance which is extremely important. To measure those types of metrics, we use qualitative metrics, like customer loyalty for example. Note: Sales performance doesn’t only depend on the performance of the sales team, even if they are highly skilled and competent. The key is in having a work environment supported by all departments in the company and inclined to favor sales in general.
Why Measure Sales Performance?
Sales performance is a key measure in the overall functioning, performance, and productivity of a company.
- It identifies the levers that work and allows you to reinforce them
- It targets the metrics that show signs of weakness to:
- find solutions to fix those problems
- put them to the side to focus on what works
Measuring your sales performance, by picking some metrics and then compiling those onto a business-orientated dashboard lets you see what your business needs. This point will be covered in more depth later in the article.
40+ Metrics to Focus on to Calculate Your Sales Performance
There are multiple ways these metrics are categorized, whether they be quantitative or qualitative. We have split them up into 4 “families” of metrics, now it’s your turn to decide what’s best for your business!
Note: many of these metrics could be categorized into more than one “family”
Performance Metrics in Rate Form
These metrics give you ratios or a percentage as results, they’re specially adapted to monitor the progress of your sales objectives. For example, to know if one of your salespeople is efficient at their job, find out the number of meetings with clients they’ve had and then the number of sales they’ve closed. These types of analytics can go a long way in improving the productivity of your company.
- Client Conversion Rate: one of the best analytics of sales performance because it measures the relationship between the number of meetings with clients a salesperson has had vs. the number of sales/deals they’ve closed.
Which can be calculated by:
Number of Potential Customers Converted/Total Number of Potential Customers x 100
- Client Retention Rate: number of customers who continue to buy from you, after the first sale. This can be calculated by ((CE-CN)/CS) x 100
CE being the total number of customers at the end of a previously specified period, a fiscal year for example.
CN being the number of new customers for the period
And finally CS being the number of customers at the beginning of the period
- Customer Loyalty Rate: records the number of customers who have bought your products or services at least two times
- Customer Attrition Rate: contrary to the loyalty rate, this ratio calculates the number of customers lost and therefore helps to measure customer satisfaction
- Conquest Rate :measures the prospection effort by reporting the total number of prospective meetings vs. the actual total number of meetings
- Conquest Rate: the number of meetings or sales closed by the number of calls
- Rate of Sales Objectives Completion
These metrics give you a snapshot of your business’s current situation at a specific moment. For example, how many sales did we close last month? By analyzing these metrics you’ll be able to see which practices should be reproduced and which should be terminated. The following Key Performance Indicators (KPIs) are precise metrics by which you can measure your sales performance, some of them are:
- Number of Propsection Meetings, meaning the number of times a member of the sales team has met with a potential customer to pitch them a product or service.
- Number of Sales Closed
- Number of Sales in Progress
- Number of Lost Sales
- Number of New Clients
- Number of Clients Lost
- Number of Claims
- Number of Sales Leads or Commercial Opportunities
- Sales Revenue Generated, compared to expectations, by salesperson, etc.
- Average Customer Purchase- Sales revenue compared to the number of sales
- Frequency of Sales Interactions - meetings
These indicators ensure quality control throughout the sales department’s activities. Do you have a lot of potential sales opportunities? That’s great! But you have to know how to turn that into a convincing sales pitch and customer knowledge.
- The Proportion of Qualified Sale Leads
- Categorization of Leads (Quantity and Quality of Information Available)
- Knowledge about the Competition
- Knowledge about the Sales Cycle
- Knowledge of the Sales Pitch
- Knowledge about Customer’s Experience
- Knowledge about potential objections clients might have to sales pitch, and how to respond to them
- Knowledge of Sales Failures
Indicators Related to Prospection
The last metrics we just covered measure the effort put into prospection efforts, whether they be over the phone or in person.
- Number of Phone Calls Made
- Number of Emails Sent
- Number of Calls Made that led to a Sale Closure
- Number of Emails Opened
- Number of Responses to Emails Sent
- Number of Evaluated Sales Opportunities
- Number of Leads Found
- Value of Projects
- Time between the beginning of contact with a client to sale closure
- Cost of Client Acquisition
- Cost per prospect/ Cost per Lead (CPL)
Note: While this is not an exhaustive list of all the possible indicators and analytics you could possibly use to measure the productivity of the activity of the sales team in your company, it should give you a pretty good understanding of what is out there.
How to Choose Your Performance Indicators
Choosing relevant indicators is personal to each business, in the following paragraphs, we’ll give you a couple of suggestions on how to pick them. So that they’ll be helpful for you and your business.
1 Indicator = 1 Objective
A KPI (Key Performance Indicator) must serve to measure and evaluate your business’s strategy.
1 Indicator = 1 Decision
An indicator is a tool, metric, and analytic that helps you make decisions in specific areas. Looking at and following KPIs is OK, however, analyzing and pulling solutions from them is a lot better.
10 Indicators Maximum
Stick with simple KPIs, those that are especially pertinent to you and your team. Don’t go too overboard with them or you'll run the risk of losing yourself in all the numbers and losing any interest in seriously analyzing numbers that might be of considerable importance to your activity and team.
Coherent Analysis and Follow-up
Indicators are meant to be used and analyzed in the context of a business, a single number doesn’t mean anything. The number of daily meetings or the total average customer purchase per salesperson doesn’t mean the same thing in a small to medium-sized business as it does in a big company.
How to Measure Sales Performance?
With a Sales Dashboard
Analyzing numbers and data is a lot harder when they don’t have a structure or a clear frame. That’s where something like a Sales Dashboard comes in, it does multiple things:
- follows KPIs
- highlights trends, whether they be increasing or decreasing
- to help make relevant decisions at the right time
- communicate the right data to the right people (sales team, sales management, etc.)
Below you have an example of a Sales Dashboard, click on the button below to download a template
Benefits of CRM Software
Measuring your sales performance isn’t something you can do on the fly. Once you’ve decided which indicators are relevant to your activity and team, you have to be prepared to analyze and follow up with them as they change over time to make relevant decisions.
For this, the best tool without a doubt is a Customer Relation Management (CRM) Software. Full of relevant information, follow-up of your pipeline, meeting reminders… a CRM Software is all that and more.
The tools and software available on the market today make measuring your sales performance much easier by directly integrating the follow-up of performance indicators. Everything’s all in one place:
- The KPIs relevant to your activity
- Personalized reports
CRM software market trends show us that recent editions do even more and aren’t just limited to automation. Related to marketing automation, you can now find things like artificial intelligence, the use of quality data, mobility, and the use of your CRM software on a mobile app.
Track Your Sales Performance to Boost Them Further
If you’re still not convinced, you’ll probably be convinced by the potential benefit for your business that indicators bring. Not only do they measure your performance more effectively, but they also are made more visible by KPIs.
To be able to keep up with the competition in 2021, businesses can’t just analyze their sales performance themselves. A good tool, like a CRM software, guarantees a rise in revenue.
All you have to do now is dive in and pick the indicators that are most relevant to your business. Have you already picked yours?