Let's Get Metrics Straight!

Measuring activities that are tied to a sales process is the problem with metrics in the b2b world. Making matters worse is the automation of these activities with technology. The combination of automation and measurement of the wrong things is destroying sales productivity and driving up the cost of sale.

The correct measurement should be of buyer’s activity and buyers processes. When you measure these things your productivity skyrockets. When you automate the activities of your sales teams that improve the buyer metrics your productivity per hear also sky rockets while your cost of sales plummet.

The very first rule you must understand is that number of anything done by your sales team is totally and completely useless and meaningless. These days the buyers are educated by the internet. The buyer has no desire to speak to a salesperson. This means that the number of dials, calls, emails, demos presentations etc. are meaningless unless they are initiated by the prospect.

The correct metrics need to be driven by buyer behavior. The activities executed by a sales team needs to be measured when it is activity that impacts a sale. The following are examples of what I mean:

Inbound Leads: These are leads generated by a prospect reaching out. They must come in two varieties:

1.???? Leads generated from your website- These are leads generated from prospects that may be curious or interested. Your sales team needs to qualify which. This is Metric one

2.???? Leads generated by your outbound campaigns- These are from campaigns that are aimed at the latent market (non-active buyers). You do not want to have these campaigns based on your website contact. Your product pitch is not relevant here. Remember this is ninety five percent of the market. The majority of these leads should be from prospects that you have stirred curiosity in. Although you may get an interested buyer or two that your website may have missed. Your goal should be twenty times your inbound website generated leads. The market is twenty times the size of the active buyer market. Measure this.

The next metric you should measure is the number of discovery sessions your prospects allow you to conduct once they are curious or interested.

The number of presentations and demos your sales team does that the prospects want because of discoveries conducted is the next metric to measure.

The number of evaluations, POC's business cases, ROI's proposals that prospects want because of demos and presentations conducted are the next metric you should measure.

You should measure closes that result from the number of evaluations conducted. These should be close to one hundred percent of the evaluations conducted. Remember that you want your sales teams to qualify the funding and purchase intent before you do the evaluation. The evaluation step is the most resource intensive step you will conduct.

Revenues per sales head and if appropriate per technical head is also a very useful metric.

Average deal size is another useful metric as it tells you how much value your teams are able to sell.

These metrics give you a wealth of information. The conversion rates tell you how effective your salespeople and enablement is for each critical step of the sales cycle.

When salespeople struggle with a certain step this is where they need skill development. When your teams struggle as a group your issues are likely systemic and have to do with the enablement and tools the salesperson has to execute with.

This set of metrics gives you a measure of activity and impact not just activity. This is how you drive up productivity, improve the effectiveness of your teams and your processes.

When you do this you should set up your sales stages in your CRM to correspond to this. Perhaps as follows: Awareness and curiosity = inbound leads and discoveries. Interest = presentations and demos Desire = Evaluations Conviction = complete ROI, Business Cases, Close = Contracts delivered and negotiations conducted.

The bolded above are the stages of your sales cycle. The inane activity-based stages you have today as stages heve no bearing on closed revenue. The number of the activities you measure have no correlation to revenue unless they have been initiated by the client.

Yes the activity will drop precipitously but the quality of the activity and its impact will increase precipitously. The result will be more sales at a lower cost!