Sales are the ultimate determining factor of whether a business stays in business. However, not everyone who is concerned with sales is an on-field salesperson. For example sales managers and executives need to stay updated about the sales performance without physically being present at the point of a sale and it can be difficult to keep a tab on geographically diverse sales teams or even sales across a variety of product lines. A great way to stay on top of the company’s sales performance, as well as the sales team’s effort, is through collecting and measuring sales KPIs.
Key Performance Indicators or KPIs are metrics that are used to quantify and measure the performance of a business or various business units or even an individual against goals and targets. The goal is to select those KPIs which are most relevant and up to date to the specific industry and make them customized to your business.
Top Seven Sales KPIs In 2019
1. Opportunities That Convert To New Leads
One of the metrics that people in managerial positions constantly have to monitor and worry about is new leads. Is the sales team working efficiently to meet targets as well as seeking new opportunities for sales? The only reason why salespeople not only get a fixed salary but also are probably the only ones that get insane incentives, bonuses and commissions for exceeding targets and identifying new sales lead is that that is one of the most crucial aspects of any business expansion and growth.
By monitoring the new leads through sales, monthly and yearly targets and quotes and identifying the best salespeople, training and sharing sales target vs actual reach data, a sales manager can instill a little competitive spirit within the team and keep them motivated.
2. Sales Volume by Geographical Location
Sales comparison across various geographical locations across physical stores and online purchases will bring forward the numbers that reveal the volume, showing the demand and supply of your products across different locations. This knowledge is essential for customizing products by region or even creating unique marketing campaigns by understanding your target audience. Sales promotion techniques such as offering free samples, try before you buy (in games, gym-memberships, automobiles, etc), coupons, free demos, shelf displays, and discounts can be tested in one location to predict if they work or not before implementing it across all stores that fall in the same customer target criteria.
3. Rate Of Acquiring New Clients
The next frequently used sales KPI is the rate of client acquisition. This is essentially the rate of conversion: how many of those who are reached out by your sales and marketing teams eventually convert to customers? Identifying the reasons why some sales rep do better than others and what are the aspects they consider while approaching clients could be the key to solving the puzzle of the increasing rate of client acquisition. The rate of reach vs final conversion can reveal a lot example how many attempts would it take to convince a new client to convert and when would be the right time to stop investing in a client if they are a cold lead to save time and energy of your sales rep and invest them in other potential clients.
Rate of client acquisition should even be compared with methods used to do so. Are clients responding better to emails or one-on-one meetings or more convinced over simple phone calls? Studying rate of client acquisition through different sales rep and their techniques vs out-reach method would help a business draw insight into what is working in the industry.
4. Net Promoter Score (NPS)
This is a feedback survey to measure how likely are clients or customers to recommend your product to someone else. The results are categorized into three categories. The ones who rate them the highest will not only recommend but only renew or return to buy again. The second group is those who are satisfied and these are the ones who buy the most during sales and discounts. The third category: those who do not like your products and can damage your brand with reviews and ratings.
It is recommended to send your NPS survey regularly at an interval of three to six months and not very early on to new customers as they need time to adjust to your product or service. Use this NPS calculator to know your business NPS score.
Engaging with customers and clients whether on social media or in-person through sales representatives is of vital importance to ensure long term business. Building trust and loyalty can go a long way to keeping a business successfully thriving in the market. This activity will also provide insight into the ever-changing customer demands and aid in business strategy planning.
Getting your sales and CRM teams to keep a track and tally of interactions with a client is a good metric to keep in handy to understand the average length of a client relationship through client engagement.
6. Product Pricing and Competitor Pricing
Having your average product pricing gives you the power of immediately knowing the impact of promotional strategies on revenue numbers. This can be quite an advantage while matching your competitor’s pricing or creating a strategy to get most sales by offering the best price without creating a hole in the revenue pocket.
7. Upsell/Cross-Sell Rates
Your most qualified leads can be buyers of your up-selling and cross-selling products or services. Ask your sales rep to keep a track of when and to whom, how and what do they upsell or cross-sell and use this to re-purpose products, increase sales with minimum efforts and reap the profits. As they always say, use the 80-20 rule. Focus your capital, time and energy on the products that bring in 80% of the business.
Sales KPIs are only a stepping stone to the sales target and goals ahead. Understanding these KPIs can help you fill the missing gaps and identify areas that need action to generate sales. If you can track it, you can improve it. Tracking your KPIs is only the first step but coming up with strategies to constantly improve them with trial and error is the key to figuring out what works best for your organization and your target customer base.
If you liked this article then be sure to stay subscribed to Wyzebulb Blog as we are dedicating a series of upcoming blog posts focusing on KPIs. Here is our blog post on Marketing KPIs for 2019. Don’t forget to like, comment your thoughts on the article and share the blog post with others who may find it useful. Cheers!