The famous SharkTank entrepreneur, Daymond John, explained the importance of sales monitoring perfectly in this analogy:
“Imagine your ship is in a battle, and you have no command center giving visibility on whether or not your ship has been hit until 30 days later, nor visibility on whether enemies are behind or in front of you. What do you think will happen to your shit? You sink.”
Pretty much sums it up, doesn’t it?
In the dynamic world of sales, you need an effective sales process for tracking sales performance. This will provide you with crucial insights that will make you more effective at selling, helping you save time and effort, earn revenue, and, more importantly, boost your sales career.
Implementing a sales monitoring system can seem like hard work. But the good news is, it doesn’t always have to be.
Why Is Sales Monitoring Important?
It doesn’t matter whether you’re a B2B or B2C sales professional—or what size or industry your business is—you need sales monitoring to measure your progress and optimize performance to ensure better outcomes.
Moreover, you won’t have to second guess every decision when you know the numbers. You can make smart, data-based decisions, which will make you a more efficient and savvy salesperson.
Additionally, you don’t have to be a sales manager, leading a sales team to take advantage of a sales monitoring system.
Monitoring sales performance is also important for individual sales reps too. When you own your key performance indicators, you’ll become a sales managers best friend.
Monitoring Individual Sales Performance Metrics and KPIs
To hit your ultimate revenue goal, you must know what sales metrics your organization’s sales management uses to track sales throughout the sales funnel.
For this, you’ll have to use past sales performance data and work backward up the funnel from the organization’s projected revenue goal to set your goals. A good place to start is considering the following questions:
- Based on your average deal size and win rate, how many opportunities can you open?
- How many discovery calls can you book to open that many opportunities?
- How much outreach do you need to do to secure that many discovery calls?
Notice the pattern?
Besides revenue, you should also be looking at:
- Win rate: Considering the number of deals and the size of deals you’ve cracked, are you on track to hit your revenue goal?
- Pipeline creation: Are you creating enough opportunities up the sales funnel to meet your sales quota?
- Average deal value: Will the size of your deals need you to close more or fewer opportunities than you already have in your sales pipeline?
- Average deal size: Can you improve your performance by increasing the velocity?
- Customer acquisition cost (CAC): Is the amount of time and resources you’re investing into each deal worth the results you’re achieving?
- Forecasting consistency: How reliable are your pipeline projections? Are you successfully closing deals within the timeframe you’ve established for yourself?
Measuring indicators of activity level can also come in handy. This includes:
- Speed to lead: How quickly are you following up with leads after making contact?
- Outreach attempts for contact: Are you nurturing your leads effectively?
- Connect to the ratio: How many outreach attempts does it take to get a prospect to respond? How effective is your messaging?
With the sales metrics covered, you can next focus on the actual monitoring of sales.
5 Easy Steps to Monitor Your Sales Progress
We’ve discussed the different metrics and KPIs. But before you start measuring them, you’ll need to take a few extra steps to ensure accurate results. So here’s a step-by-step rundown of monitoring sales effectively.
Step 1: Establish Your Sales Goals
The first step to setting up a good sales monitoring system is to set clearly defined goals and expectations based on your sales quotas.
This will help you discover obstacles and understand how to make contact with your prospects more effectively. You’ll also get a better sense of direction, which will make you more invested in working to achieve them. Here are some examples of common high-quality sales goals for inspiration:
- Spend one hour every day prospecting to find good-fit leads
- Reduce customer acquisition costs by 10% by month-end
- Earn $2,000 per week in commission
- Increase win rates by 7% in Q1
- Bring in 9% more revenue every two months
Step 2: Create a Plan to Measure Both Short-Term and Long-Term Goals
When using sales monitoring systems, you want to keep a dual focus on short-term task completion and long-term performance.
While tracking your daily or weekly sales goals will keep you up-to-date with your sales performance, the inevitable highs and lows of sales may leave you demotivated or anxious. It’s during these challenging times that long-term goals can come in handy. Long-term objectives provide a more realistic measure of success, which is why short-term failures don’t seem like a dead-end anymore.
At the same time, if you find you’re achieving your daily and weekly goals but are still nowhere close to long-term success, you’ll have to change your approach. First, review whether your micro-goals are actually helping with your end picture and make adjustments as needed.
Step 3: Use Sales Tracking Software to Visualize Your Sales Pipeline
Closing deals shouldn’t be your only goal. You should also aim to fill every stage of your pipeline, which involves tracking all your sales prospecting efforts and qualifying and nurturing leads.
You have to understand how to fill your sales pipeline—and fill it correctly. While you can always turn to your superiors for advice, you can also use sales monitoring tools and software like a customer relationship management (CRM) to measure metrics and track your sales progress at a single glance.
For instance, the best CRMs have customizable sales dashboard that give you tailored visibility of your sales pipeline, how much revenue you’re likey to generate, your sales cycle length and they allow you to track other metrics that are relevant to you. As such, you can simplify your sales cycle and focus your efforts on converting leads that matter.
Step 4: Make Your Workload More Focused
Sales professionals often develop an overly complicated system for tracking and reporting on their individual performances.
Don’t be one of them.
Focus on streamlining your workload by making it more focused. Again, you can achieve this by using tools that support customizable sales reporting features. This will allow you to quickly visualize relevant data that can help you assess your overall performance.
You can keep track of the number of deals added to your sales funnel, the average age of your deals, and the number of deals and stage-to-stage conversion for each one of them at any given period. Even better if you can apply custom filters to reports to see the exact data you need at any given time.
Like they say, work smarter, not harder.
Step 5: Apply Feedback and Strive to Improve
Next, it’s time to apply the collected data and insights.
You want a fair picture of how your performance compares against the established goals and expectations. Now that you know where there is the scope of improvement, brainstorm ways to troubleshoot solutions and meet these gaps. Don’t be afraid to get in touch with your sales manager if you need more training, support, or additional resources.
After all, great teams don’t hold back from one another.
Take immediate steps to monitor progress and become better at selling! Become a part of our Selling Made Simple Academy™ to fix your prospecting and close more sales.