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Wednesday, May 28, 2014

Four Key Sales Metrics That Businesses Fail to Track 05-28

Four Key Sales Metrics That Businesses Fail to Track

While you should always generate new leads, have a solid sales process and live up to your brand promise, tracking these key sales metrics provide a quick analysis that will point you in the right direction and help keep your business on track.
Four Key Sales Metrics That Businesses Fail to Track
What key metrics to you track for your business? Organizations track their clients (or service hours) and revenues from those clients. However, taking some time to look at a few key metrics will help you to analyze your business when times are slow and take the best approach to moving it forward. Here are some important numbers that you should measure in your business.
How do your prospects and clients find you?
Whenever someone reaches out to you, it is critical to ask how they heard about your business. Did they learn about you from a professional referral, a current or former client, an advertisement, through social media or via a web search? Which referral, client, advertisement or keyword? How many of each type of referral do you receive each week or month? If you notice a drop, the first place to look is at your year over year inquiries. If they have decreased in a certain area, you may need to boost your marketing efforts in this area or change your approach. When your inquiries drop, it is time to do more lead generation activities.
What percentage of your prospects are converting to clients?
While this number varies by industry, by individual businesses and by your sales process, it is important to know what the number is for you. If your business has dropped, but your level of inquires remain the same, you may find that you are converting fewer prospects. Now you must try to pinpoint the problem. Did you change your sales process? Did you hire a new sales person? Are your referrals offering a service that you do not? Is a competitor or former client warning prospects away? Is someone on your team struggling with a new objection? If you are continuing to focus on lead generation but are failing to convert your leads, focus on your sales process. Instead of putting more energy into brining in new leads that do not convert, analyze the reason why and consider some training in this area.
What is the amount of service that each client receives?
Perhaps you have the same number of prospect inquires and conversions, but clients are signing on for fewer hours or lower priced projects? In this situation, I often hear, “It’s the economy, people have fewer dollars to spend.” Before you jump to this conclusion and simply accept the situation look at both your sales team and your competitors. Is a competitor undercutting your price or including a service that you do not? Perhaps they are simply doing a better job managing their prospects. Do a competitive analysis to find out. In addition, ask yourself if your sales team is continuing to demonstrate value in your offering. A lower price option may not be the best answer for your prospects and it is important for your sales team to be able to show prospects how they will reap greater benefits from this investment. Again, consider bolstering your sales training.
What is the duration of service for your clients?
If you are still attracting prospects and converting them to clients, but they are staying with you for fewer months (or years), it is time to look internally at your service and support. Are your prospects still seeing value in your offering? Is your support team addressing problems quickly and effectively? Has something changed with your delivery of services? These are critical elements to address, because poor service delivery will eventually impact new inquiries and conversions. Consider an assessment of your customer service to ensure that your entire team supports your sales efforts.
The Bottom Line
While you should always pay attention to generating new leads, having a solid sales process to convert leads to clients and living up to your brand promise, when your situation changes you need to triage it quickly. Having these metrics available will help you with a quick analysis that will point you in the right direction and help you to get back on track quickly.

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