Top Metrics to Track to Measure Sales Productivity at Every Level
There once was a time when salespeople did everything. They would make cold calls, set appointments, handle appointments, close business, implement solutions, and manage the account.
Today, things are different. Each one of those steps in the sales process is segmented into a specialty role. There’s the sales development rep, the sales executive, the account manager, and the sales manager. At each of the four levels, there are important metrics to track to determine success in that role. Ultimately, success at each level equates to the success of the sales team.
Here are the top metrics to track to measure sales productivity at each level of the sales process.
Level 1: Sales Development Rep
The responsibility of the sales development rep is to generate opportunities. So, the key metric to keep track of is the number of opportunities created per day, per week, or per month. This communicates how effective the rep is at creating opportunities that can lead to closed deals.
Another metric to track is the conversion rate from the number of contacts to appointments set. For instance, if a rep contacts 100 people and sets five appointments, he or she has a conversion rate of five percent. Beyond that metric, it is important to track how many calls or emails it takes a rep to set an appointment. That rep may need to call or email each person four times to set one appointment. These metrics helps managers get both an understanding of effort that goes into creating opportunities as well as the rep’s efficiency.
Level 2: Sales Executive
The sales executive is the closer. The first metric to track is the appointments set-to-held ratio. In a perfect world, if 10 appointments were set by the sales development rep and the sales executive completed each appointment, the sales executive would have a 100 percent set-to-held ratio. This ratio is not only an indicator of the sales executive’s performance, it may also shed light on the quality of the opportunities created by the sales development rep.
The appointment-to-proposal ratio is also important. If a proposal must be sent after a successful meeting, it’s good to know the rate at which proposals are being sent. Next, there is the proposal-to-deals-won ratio. These ratios show how opportunities are progressing through the sales funnel.
Also, it’s helpful to know the average time it takes to close a deal after the appointment is held. This metric helps managers determine the length of the sales cycle. It is a crucial metric because the amount of time an opportunity spends in the funnel has a strong correlation to its likelihood of becoming a won deal. Opportunities that spend longer than average in the sales funnel have a greater chance of being lost deals.
Level 3: Account Manager
When the nature of the sale requires an ongoing customer relationship, the effort associated with managing that relationship falls onto the shoulders of the account manager. Tracking their retention rate is a good way to measure their success. So, if the manager has 100 clients and retained 97 of them over a defined period, they have a retention rate of 97 percent.
Another metric to include is the average length of time the customer has been with the organization. When connected to the value of the deals closed with this customer, this metric helps give managers a sense of the lifetime value of the customer.
Level 4: Sales Manager or VP of Sales
The person in this role is primarily concerned with sales productivity and closed sales versus goals. They are responsible for their team meeting set goals as determined by the organization’s budget. If the team is on target at every level of the sales process, then the team is on target for meeting their sales goals.
If the team is coming up short at one or more levels, the metrics discussed above will help the sales manager determine where the problem is. They can use individual metrics to see who is performing well and who is struggling to meet their goals. Once the struggling individuals are identified, they can be coached to improve their metrics. For instance, a sales rep may be making a number of calls that is far below average. The metrics show that if they made just 20 more calls a day, they can set 1 more appointment. That additional appointment each day will greatly affect the close rate and ultimately increase revenue.
Metrics Fuel Data-Driven Decisions
Tracking metrics has one overarching outcome. It fuels the ability to make data-driven decisions. Only by regularly measuring the performance of the sales team and the individuals in it can managers know where to allocate resources, determine what needs to be done to make sure the team hits its numbers, and coach the team in the best ways to ensure ongoing success.