And as a sales leader, you already know this. Your sales reps have a deep knowledge of how prospects can leverage your product, and they can craft customized plans about the best ways to do so. When it comes down to it, those are the only reasons prospects actually need reps.
Knowledge of your product is undeniably valuable, but it's not enough for your team to be successful. You need to understand the factors affecting your team’s performance as well. Those are what allow you to tweak your sales process and fill gaps in knowledge as needed.
To get there, you'll need key tools known as sales analysis reports.
What is a sales analysis?
The term 'sales analysis' generally refers to the analysis of specific trends or components impacting a company's sales operations. Different analyses provide their own unique insight into the strengths and weaknesses of a company's sales team, sales management, individual sales reps, or overall sales strategy.
The first step to gaining a deep understanding of performance is having the right data. Yet it's all too common for salespeople to ignore that fact and not use any dedicated technology to track lead and customer data as a result.
Without even basic information on contacts, sales leaders can’t hope to analyze their team’s performance or identify areas for improvement. There are some essential reports every sales leader needs to keep track of. Here, we've listed some of the most important ones.
Sales Analysis Reports
A complete and accurate pipeline is a must-have. Without one, there’s simply no way to assess the health of your business at any given time. As a sales leader, you need to know exactly which deals are sure things, which might push, which you could lose altogether, and how much of an impact each deal has on your bottom line.
Of course, accurate forecasting is directly linked to thorough sales qualification. Make sure your reps are doing their due diligence to guarantee a realistic pipeline.
In the context of sales, the term "conversion rate" refers to your ability to convert prospects into leads and leads into customers. When considered on an operational or team-wide scale, the metric can be very telling into the efficacy of your overall sales strategy. It can also provide insight into the strengths and weaknesses of individual reps.
By monitoring your conversion rate, you can pin down the points in your sales lifecycle at which you're excelling or underperforming. If you're consistently converting leads to opportunities at a high conversion rate, you can bolster whatever strategies you're using at that point in the process. But if your team is having trouble converting opportunities to customers, you can start to identify areas for improvement at that stage.
It's also a solid litmus test for individual reps' strengths and weaknesses. If a rep is underperforming altogether, you can look into their conversion rate to see where they really need help.
Your average deal size is crucial in predicting revenue and monitoring the soundness of your sales pipeline. If your revenue target is $200k for a quarter and your average deal size is $20k then you understand you're trying to land 10 deals in that timeframe. That might seem obvious, but it's still important to keep tabs on.
Average deal size provides the basis for your reps' quotas and lets them know roughly how many deals they're expected to land. It also lets you set expectations and milestones for your sales cycle. Ultimately, it might seem like a no-brainer, but it's still worth a reminder — always monitor your average deal size. It provides critical structure to your sales operations.
Average sales cycle length is exactly what it sounds like — the average time it takes for a rep to close a sale. It's a straightforward metric that can be very indicative of how an individual rep is performing and the overall efficacy of your sales process.
When considering the metric, you have to establish an ideal timeframe to use as a benchmark. Have a picture of how long it should take a rep to work through your sales cycle. If you're finding individual reps are struggling here — taking longer than their peers or your standards — you can take the time to look at their efforts and identify areas for improvement.
If all your reps are struggling to keep pace with your target average sales cycle length, then it's probably time to take an objective look at your operations. You might find fundamental flaws in your approach, your training, or your management style, so you can take time to remedy them.
Hopefully, your marketing team is creating collateral that helps your reps move their prospects through the sales process. And hopefully, your sales reps are using it to good effect.
But if they aren’t, or the marketing collateral you are getting isn’t relevant to your prospects, you need to find that out as soon as possible. You can easily track what marketing content is working in all your sales cycles and which documents have sat untouched for months. Communicate that information to your marketing team and you’ll be rewarded with more relevant and useful content.
6. Won and lost deals analysis
Deals-in-progress aren’t the ones you should be focusing on. To understand the state of your business, you should be tracking all the deals you win and lose. Are there specific features prospects always go crazy for, or competitors you consistently lose to? Look for commonalities between these deals, and you’ll gain valuable insight into your product’s overall strengths and weaknesses.
This is also a good way to spot under- and over-performers. For example, two reps who have the same average quota attainment could both appear to be stellar, but differ wildly when it comes to actual performance.
If your data reveals that one rep spends a lot of time helping others get deals across the finish line while still maintaining high attainment, you have a great manager candidate on your hands.
On the flip side, records could reveal that a second rep has the same attainment as the first but relies on other teammates to run demos or closing calls. There’s always a story beyond what the numbers tell you, and analyzing won and lost deals by rep will reveal it.
Understanding why people churn out of your customer base can be even more revealing than evaluating why deals were lost. After all, a churned customer is a clear sign that misalignment occurred somewhere during the sales process. Closely monitoring trends in churned customers empowers you to provide direct guidance on fixing bad patterns you see throughout the sales process.
As a sales leader, you have a lot to keep track of. It helps to know what different information sources can reveal about your reps, your strategies, or your management style. All of these reports can provide critical insight into what you're doing well and what you could be doing better.
If there's anything to take away from this article it's this — always track your customer and lead data. If you're not, you're missing out on reports that will undoubtedly help your business be the best it can be.
Editor's note: This post was originally published inMarch 3, 2016 and has been updated for comprehensiveness.
Originally published May 5, 2020 3:30:00 PM, updated May 05 2020