Having a strong Sales Strategy is vital – but how do you measure the effectiveness of that strategy? While many businesses make complete guesswork of it (and fail as a result), the best companies analyze their sales and pivot as necessary to maximize their revenue potential.
Sales is a metric-driven field. When you are analyzing your Sales Strategy, you want specific metrics to measure and track. Without using any specialized software or hiring a company, there are four key metrics that you can start tracking today to analyze your Sales Strategy.
Sales Cycle Time – How long does moving through your sales pipeline take? From the moment a lead starts to the moment it closes, what is the timeframe? Do you churn in a few seconds, a few days, a few months? Tracking this helps you to better understand not only your cashflow but also can help highlight any roadblocks that are potentially stalling the process.
Conversion Rate – What percentage of your leads are actually converting into sales? If you are generating millions of leads but only closing a handful of them you know that you need to work on the latter end of the sales process. The simplest way to increase your startup's conversion rate is to examine on the problematic areas (or friction areas) in the sales process and really dig in and find a solution.
Lead Generation Rate – Just how many leads are you generating in a day, a week, a month, or a year? Understanding what kind of lead rate you have and comparing it to your conversation rate allows you to streamline your sales process, generate more leads, and ultimately drive more sales.
- Average Deal Size – Simply put, how much money are expecting (on average) per sale? Understanding and tracking this metric allows you to pursue large deal sizes with greater vigor, let go of lousy deals, and can help you to more specifically target consumers in your market.
Analyzing and tracking your sales is key in running a successful startup.