Pipeline Performance Metrics Every Sales Team Should Be Tracking
by DJ Team, on September 30, 2020
Your business undoubtedly benefits from the leads you gain, but it is ultimately sustained by the sales you close. This reality highlights the importance of implementing pipeline marketing. Evaluating your current marketing channels and the state of your sales pipeline is a crucial step towards a healthy, profitable company. A comprehensive marketing attribution model is step one - but we will come back to that later. By regularly tracking your sales pipeline metrics -- also known as the path that leads your clients from the first interaction to the final sale -- you can keep your business’ growth on the up-and-up.
What is more, by documenting your business’ current sales contacts, engagements and a history of past interactions/deals, you offer current and future employees a rich resource to help close sales. To make the most of the data it provides, your company’s sales pipeline should be properly analyzed with the appropriate metrics. If you aren’t sure which metrics are most useful to evaluate your sales pipeline or you would like to learn more about amplifying your business’ success with helpful analytics, simply keep reading.
The Role of Lead/Sales Attribution Models
A key step in evaluating your sales pipeline is knowing which of your marketing channels are the most efficient. To do this, you can use a sales attribution or lead attribution model. These models determine how to give credit to your marketing channels after a conversion (i.e. a closed sale).
In other words, attribution models show which of your marketing channels are pulling their weight and which ones aren’t. A few examples of lead attribution models are first-touch, linear and last-touch attribution. When considering different lead/sales attribution models, remember that there is no “perfect model.” It’s up to each company to decide which model best complements the way their business functions.
Measuring Channel Performance
With an attribution model in place, it’s easier to measure the effectiveness of your various marketing channels. Start by establishing your sales objectives for each channel. Then, choose your specific performance metrics, starting with a key performance driver such as “units sold.” The other metrics can be determined based on this key performance driver. Keep in mind that while it is possible to evaluate your channels with hundreds of metrics, organizing and analyzing the heaps of resulting data will be a headache. Try selecting a handful of relevant metrics to get started.
Tying Pipeline Attribution To Marketing Channels
While lead source attribution models allow business’ marketing teams to better understand the effectiveness of certain channels that recruit potential new clients, pipeline marketing focuses on the later stages of the “pathway” to closing a sale.
In the long run, lead value does not contribute to the viability of your company in the same way as closed won revenue. By prioritizing finalized sales over new lead generation, your company can maximize its available resources and contacts, ultimately generating more tangible profit.
Maximizing Pipeline Coverage
Evaluate your business’ sales pipeline performance by monitoring a series of factors. Lead source attribution models combined with pipeline metrics help evaluate lead response time. Perhaps the most important factor to monitor is your company’s probability to close. Paired with the sales pipeline velocity, these metrics will reveal how quickly your company finalizes sales. Another indispensable tool is your sales pipeline coverage -- a ratio that measures how much pipeline your business has compared with the sales quota you need to close.
Many marketing experts agree that ideal sales pipeline coverage is between 3-4x, which means that you count on every third to fourth sale to close (out of all your leads) in order to achieve your financial goals.
Identifying Key Performance Indicators
There are several key performance indicators (KPIs) that show your business’ sales success. Deal attribution analytics include but are not limited to:
- New marketing leads
- Sales target
- Customer acquisition rate/cost
- Average revenue per unit
- Deal amount
- Customer lifetime value
- Turnover rate and
- Marketing leads-to-opportunity ratio.
Unsurprisingly, the metric that marketing professionals monitor the most is “new leads,” used to track potential profitability as well as how efficient various team members are. This has resulted in a constant back and forth between marketing and sales about the quality of the leads.
Marketers, especially B2B marketers, have always lacked the ability to truly see the journey of a lead from top of funnel all the way to closed won/lost - that is, until now. With the DemandJump CRM integration you have the ability to see the entire picture. This allows you to see what organic search terms, campaigns, and even individual pieces of content drive pipeline value and close won revenue.
With this information you can act quickly. Quit wasting budget, try it for yourself - FREE for 7 days. You’ll be surprised to see content and campaigns that seem to be performing well but are not carrying their weight in closed won revenue. Again, don’t take our word for it, try it for yourself.