Struggling to meet your sales targets? You’re not alone.
In 2023, exceeding sales targets was the top priority for sales managers, according to a HubSpot survey. 34% of respondents cited exceeding quotas or targets as their main focus. Following closely behind were goals of making the process more efficient (29%) and targeting new markets (28%)
Sales managers, particularly those in the field, often find themselves falling short of their goals. The pressure to meet and exceed targets is relentless, with expectations escalating year after year.
So, what’s the solution for sales managers striving to reach these elevated expectations?
Setting sales KPI goals and diligently tracking them.
But what exactly distinguishes sales KPIs from sales metrics?
Sales metrics provide general insights into sales performance, typically benchmarked against industry standards or competitors. On the other hand, sales KPIs are tailored to individual businesses, serving as checkpoints toward overarching goals. They are specific, measurable indicators used to track progress over time.
Why are KPIs crucial for sales managers to track?
Sales KPIs are vital for sales managers because they offer measurable benchmarks for evaluating team and individual performance, aligning goals, and identifying trends. By tracking KPIs, managers can set realistic targets, forecast future performance, and optimize sales processes for increased efficiency and productivity. Additionally, KPIs provide insights into behavior and preferences, enabling tailored sales strategies that enhance customer satisfaction and retention.
KPIs that BFSI sales teams should consider tracking
Customer Lifetime Value (CLTV): Calculate the total revenue a customer is expected to generate throughout their relationship with the company. This metric helps in assessing the long-term profitability of acquired customers.
Conversion Rate: Track the percentage of leads or prospects that convert into customers. This can be measured at various stages of the sales funnel to identify areas for improvement.
Average Deal Size: Determine the average value of each sale closed by the sales team. Monitoring changes in deal size over time can provide insights into market trends and customer preferences.
Sales Cycle Length: Measure the average time it takes for a lead to progress through the sales pipeline and convert into a customer. Shortening the sales cycle can improve efficiency and increase revenue.
Cross-Selling and Up-Selling Ratio: Track the percentage of customers who purchase additional products or services beyond their initial purchase. This demonstrates the effectiveness of sales strategies in maximizing revenue per customer.
Churn Rate: Measure the rate at which customers stop doing business with the company. High churn rates can indicate a drop in customer satisfaction.
Sales Productivity: Assess the efficiency of the sales team by measuring the amount of revenue generated per sales representative or the number of deals closed within a given period.
Pipeline Health: Evaluate the quality and quantity of opportunities in the sales pipeline. This includes tracking metrics such as pipeline velocity, stage conversion rates, and deal aging to ensure a healthy pipeline of potential revenue.
Customer Satisfaction and Net Promoter Score (NPS): Gather feedback from customers to assess their satisfaction levels and likelihood to recommend the company to others. High NPS scores indicate strong customer loyalty and can lead to organic growth through referrals.
In summary, tracking tailored KPIs is crucial for sales managers in 2024 to surpass escalating sales targets. These metrics offer strategic insights, enabling teams to optimize performance, identify growth opportunities, and drive sustainable success in a competitive market.
