Snag Business Presents: Look at the Stat Sheet: Tracking Sales Metrics at Every Level
In the business world today, tracking sales metrics is indispensable. They provide a quantifiable measure of success, offer insights into areas of improvement, and allow for tracking individual and team progress. Whatever the data point - if you can track it, you can improve it.
However, not all sales metrics are created equal, and the ones you focus on can significantly vary depending on your experience level. This post guides you through a high-level look at best practices for beginner, average, and advanced sales teams and how marketers calculate these stats for their sales teams.
Rookie Level: Beginner Sales Performance Metrics:
When starting in sales, it's essential to understand the fundamental metrics that will form the base of your sales performance analysis.
1. Sales Volume: This is the total number of units sold within a specific period. It's calculated by adding up all sales made within the time frame.
2. Revenue: This is the total income generated from sales. It's calculated by multiplying the price of each unit sold by the number of units sold and then adding these amounts together.
3. Conversion Rate: This is the percentage of leads that become customers. It's calculated by dividing the number of converted leads by the total number of leads, then multiplying by 100 to get a percentage.
All-Star Level: Average Sales Performance Metrics:
As you become more comfortable with the basics, you can delve into more nuanced metrics that offer deeper insights into your sales performance.
1. Sales Growth: This measures the increase or decrease in sales volume over a specified period. It's calculated by subtracting the previous period's sales from the current deals, dividing the result by the last period's sales, and multiplying by 100 to get a percentage.
2. Average Deal Size: This is the average value of each sale. It's calculated by dividing the total revenue by the number of deals closed.
3. Sales Cycle Length: This is the average time to close a deal. It's calculated by determining the average number of days between the first contact with a prospect and the sale's closing.
Hall of Fame Level: Advanced Sales Performance Metrics:
Advanced metrics can provide a sophisticated understanding of sales performance for seasoned sales professionals.
1. Customer Acquisition Cost (CAC): This is the total cost of acquiring a new customer, segmented out by each individual lead source. It's calculated by adding up all sales and marketing expenses for a certain period and dividing it by the number of new customers acquired during that period.
2. Customer Lifetime Value (CLTV): This is the total revenue a business can reasonably expect from a single customer account. It's calculated by multiplying the average purchase value by the average purchase frequency rate to determine customer value, then multiplying customer value by the average customer lifespan.
3. Sales Pipeline Velocity: This measures the speed at which leads move through your sales pipeline. It's calculated by multiplying the number of deals in your channel by the average deal size and the win rate, then dividing the result by the sales cycle length.
Summary
In conclusion, no matter where you are in your sales journey, a wealth of metrics are available to help measure and improve your performance. By understanding these metrics and how to calculate them, you can gain valuable insights that can drive your sales success to new heights.
Your stats are critical to tracking your sales and marketing performance because remember - if you can track it, you can improve it.