While an impressive closing ratio is desired by any sales manager, you can’t expect peak performance from your reps all the time. Reps are human, which means they’re not perfect and they probably have some areas for improvement.
Sales KPIs, or key performance indicators, are sales metrics used to track individual rep performance against goals. They don’t just show you where your reps are excelling, but also where they could use some coaching as well.
You need sales metrics that allow you to identify issues early enough so that your business results won't be impacted, while also telling you what needs to be changed or updated in terms of rep behavior so you can help them course correct. Keep in mind that it is totally possible to choose the wrong set of sales KPIs that don’t align with your business goals and end up costing you money.
So if you’re a new manager looking for a place to start with setting awesome sales KPIs to impact sales growth, here’s a list of some of the most important—and commonly used—sales KPIs.
Which Sales KPIs Should You Track?
The answer to this question varies based on a number of factors. Although there isn’t a simple step-by-step process, there are a number of things to consider to help you make a smart decision:
- Choose sales KPIs that relate directly to your overall business goals.
- Less is more–don’t overwhelm your reps. Ten sales KPIs is a good number to hover around.
- Keep your company’s stage of sales growth in mind and know when to adjust KPIs when things change. In fact, outperformers are 50 percent more likely to adjust their accounts and reprioritize on a monthly basis.
- Track data on lagging and leading indicators to understand past performance that can indict your progression toward your sales growth.
Although every organization is different, sales teams usually focus on maximizing the same sales metrics:
- AE goals might be optimizing bookings, win rates, and average deal cycles
- SDR goals might be pipeline generation, opps created, and opp acceptance rates
Accomplishing these objectives starts by understanding which leading indicator sales metrics, when executed successfully, lead to the desired outcomes.
The 3 Most Important KPIs for AEs
Your AEs are laser-focused on closing deals. To understand how effective your AEs are, you need to gain granular insight into their activities and how they impact opportunities and revenue. To do so, you might want to measure the following activities:
1. Average Deal Size
Knowing the average price of closed deals allows managers to make revenue predictions. Paired with the average number of closed deals per month, this sales KPI not only indicates how much revenue will close but also which kinds of deals should be targeted.
2. Pipeline Value
Pipeline value, or the amount of revenue that could close, is essential for managers to know. By comparing the total opportunity for revenue with the actual revenue closed, management can make more accurate projections for opportunities going forward.
3. Win Rate
Knowing how many deals your sales team is winning indicates the percentage of opportunities that are won by your AEs. This is one of the basic yet crucial sales metrics because it tells you how effective an AE is at selling your product. This is also crucial in indicating the areas for improvement, which can inform where a manager focuses their coaching efforts.
The 3 Most Important KPIs for SDRs
Your SDRs are focused on outbound prospecting. To effectively track their performance in bringing in new prospective customers, measure their activities such as calls, emails and contacts that result in deals. Here are the most important sales KPIs for your SDRs:
1. Dials per Day
Knowing how productive a rep is at dialing prospects in a given day provides important information to management. With an established dialing quota, management has insight into the number of dials that equate to more meaningful sales conversations and revenue.
2. Emails per Day
With between 70-80 percent of B2B decision makers preferring remote interactions, tracking reps’ productivity with emailing prospects is an important indicator of success. Management needs to know the number and cadence of sales emails sent out each day.
3. Dials-to-Deal Ratio
This sales KPI is measured by the total number of dials divided by the number of deals closed as a result of the dials. This allows management to see the correlation between calling activities and deals closed, as well as how rep activities are impacting your bottom line.
Utilize Data for Sales Growth
Now that you know the most important sales KPIs to measure, how are you going to keep track of the data? Using a data-driven sales management platform such as Atrium, you can customize your reps’ sales metrics, receive reports for performance improvement indicators, and formulate your coaching plans.
Need more useful tips to guide your sales reps? Check out The Ultimate Sales Metrics & Diagnosis Guide.