SALESMATH 1.1: ROI of good targeting.

Continuing on the idea of sales math, here is a potential formula for the early party of the funnel.   

Targets * first mtg / target * % move to next step = # middle funnel deals

 Let’s break this apart:

Targets = often the focus here is a big number.   I remember meetings where 100’s if not a 1,000 plus targets generally was cheered about.  However, if you look at the above formula the next two parts are clearly improved by the quality of the targets.   Another dimension here is what is the optimal number of targets per sales person.  From working with many sales people I would throw out that 50 to 75 firms per sales person is a good level.  This assumes a SaaS sales model and mostly middle tier firms.  For top tier, the number often gets below 15.  So again target number is a very important item to consider for a quality pipeline and how many sales people you have. 

Quality targets seems so obvious but in fact can take quite a bit of work to generate.  Scoring methods can help, client look-a-like work, referrals great as mostly to similar firms and people, but I would suggest one area is the most impactful.  Experience.  A sales executive who has worked with a set number of account for 3, 5 or more years knows so much about their fit for a product and their evaluation process. This person can really tune up the targeting process and pay dividends to the whole process.    One CEO the other day told me he hired one senior sales person who changed his business.  He said “we started meeting with the right firms and in the right way after many years of limited results”    Of course finding the right person is not easy but what a return.

What do you think?