Measuring sales success isn’t as simple as it sounds. There are many ways to assess sales numbers and customer growth, so the task can quickly become overwhelming. Before you know it, you have contradicting statements and you’re forced to start all over again.
This is where KPIs, or Key Performance Indicators, are essential. In this piece, we’ll discuss what KPIs are, which KPIs to use in certain situations, and how to implement KPIs in your sales team.
What are KPIs for sales?
Sales KPIs (Key Performance Indicators) are specific sales metrics used to evaluate team and product performance. They are directly connected to company-wide objectives and priorities. While KPIs can be invaluable in monitoring sales success and progress toward longer-term business goals, problems arise when organizations don’t know which KPIs to use.
Not every KPI formula is essential for every business—a funeral service company, for instance, probably shouldn’t measure success by customer retention, as they’re not really in the business of repeat service. So, ensure you choose KPIs that are relevant to your industry and business goals.
Sales KPI examples
Let’s dive into some KPI examples. The following examples are broken down into categories to help you find the right one for your particular need.
Business development KPIs
Business development runs a little differently than other departments, as representatives are looking to expand B2B sales and B2C sales, often through cold outreach methods. Here are five sample key performance indicators for business development reps:
To track productivity, you can measure the number of sales activities performed by a single business development rep in a given amount of time. There are different ways to measure this, including the number of emails sent or the number of virtual meetings scheduled.
While this KPI isn’t always a perfect reflection of productivity, it does help to paint a picture. Keep in mind that quality matters, too. A rep who makes five calls but wins every deal is more productive than one who makes 10 calls and doesn’t close a single sale.
- Opportunities created
This one is slightly controversial because it can foster competition, and not every company wants competition as a motivating factor on their sales floor. But making each sales rep’s achievements visible to the rest of the team can help motivate other reps to push forward. Just make sure that as you go, you’re not losing sales reps to a toxic work environment.
- Proposals sent
Not only is this a great BDR KPI, but it is also an easy one to measure. By tracking proposals, you’ll be able to see which types of prospects are responding and which sales techniques are working for your reps, so you can encourage similar tactics across your team.
- Deals won
Similar to proposals, deals are simple to monitor. Plus, analyzing which sales methods were effective in winning deals enables you to restructure your sales strategy and guide your team with confidence.
- Client acquisition rate
Client acquisition rate (CAR) refers to the number of prospects who actually
convert into customers. Essentially, of the prospects a rep reached out to, how many decided to make a purchase?
The goal of this KPI is not to see who’s working harder, but to develop a benchmark goal. Too many cold approaches will lead to burnout—despite having higher activities numbers, reps may have a lower CAR. Finding the balance will create a reasonable goal for your entire team.
KPIs for sales executives
There are numerous KPIs available to sales executives and managers, but some provide more insight than others. Here are five key performance indicators for sales managers and sales executives:
- Sales volume by location
Sales volume refers to the number of units of product sold during a certain time period. Tracking sales volume across locations can tell managers and executives what products are selling best and where they’re selling best. As more customers shift to online shopping, this data is crucial in helping you manage your cost of sales. You’ll be able to determine which products to promote, cut back on, or discontinue in certain locations.
- Competitor pricing
Monitoring competitor pricing is a must for sales managers. Not only are you able to evaluate your competition and advise on prices for your company, but you’re also able to work with your sales reps to combat pricing objections and make adjustments. If your product isn’t significantly better than that of your competitors but it’s priced five-percent higher, you’re going to face sales challenges.
- Employee satisfaction
Did you know that approximately 75 percent of employees are only moderately engaged in their work? We don’t blame them—sales can be challenging. That said, it’s management’s job to encourage productivity and ensure team members are happy. Regularly measuring employee satisfaction is critical to a positive sales culture. Send your reps surveys that ask them to rate their satisfaction at work on a numbered scale, and then take action to move those numbers in the right direction.
- Customer lifetime value (CLV)
Customer lifetime value (CLV) is a delicate balance against customer acquisition cost. CLV is the total revenue you can expect from a single customer over the course of their entire lifecycle. The key to keeping finances in line is making sure the CLV of a buyer is higher than the cost it takes to gain them as a customer in the first place.
- Client engagement
If you’re looking to grow your base of repeat customers, client engagement is a required KPI. Ask yourself: How often are clients reaching out? And when they connect with a rep, what are the interactions like? How does their number of purchases compare to the number of times they contact your team? By analyzing engagement levels, you can build a solid plan to strengthen your relationships with existing customers.
KPIs for sales support
Sales support overlaps with both sales management and business development. But depending on how big your departments are, it’s a good idea to separate KPIs so that nothing slips through the cracks. Here are four great KPIs specifically for sales support teams:
- Meeting acceptance rate
This metric is calculated by dividing the number of meetings a rep sets up by the number of replies they get. This can help you assess each of your rep’s skills as well as the quality of your sales training.
- Percentage of follow ups
Reps should follow up with every qualified lead. This percentage indicates whether potential revenue is being lost due to a lack of follow up. It can also show you if reps are struggling to find the most qualified leads of the bunch.
- Reply rates
It’s worth noting any reply to a form of outreach, and you’ll want to measure both positive and negative replies. Line up your responses to see the balance between the good, the bad, and the indifferent, and determine if your strategy needs to change.
- Deal win-loss ratio
This KPI is calculated by dividing the number of won deals by the number of lost deals. Knowing how many sales were lost and when the losses occurred allows sales support to analyze the gaps in the sales pipeline, and then create a plan for filling them in.
CRM KPI examples
Technically speaking, you can use your CRM software to track any number of KPIs. Here are five we recommend prioritizing:
- Response time performance indicators
If your CRM is integrated with a lead generation form or prompt, track the speed at which you reach out to prospective customers once you have their information. Gaining tons of leads is fantastic, but if you don’t contact them, you’re just wasting time for your lead generators. Plus, you’re losing out on potential business by waiting.
- Conversion rate key performance indicators
Conversion rate (CR) can be built into your CRM to track how often your outreach elicits a response. This outreach could be sent via a live agent, AI-powered bot, or email campaign. By tracking CR, you’ll know when it’s time to shift tactics or create new ones.
- Relationship freshness metrics
Just because a buyer makes a purchase, it doesn’t mean they’ll come back again. Keeping clients up to date on new products, promos, and special offers is essential to maintaining a consistent customer base. In your CRM, you can see the last time you interacted with a client and set reminders for when you need to reach out to them.
- Funnel drop-off rate key performance indicators
You need to know when a customer clicks the unsubscribe button, abandons their cart, or turns down a meeting with a rep. Monitoring where you’re losing customers in the funnel enables you to identify the cause and take action before the drop-off rate gets worse. Some drop-off is normal in any business, but a large percentage is usually indicative of a larger problem.
- Customer acquisition cost (CAC)
We discussed this a bit earlier, but a low CAC is important for maintaining company health. If it’s costing you a lot of money to attract customers and you’re not seeing a return on that investment, then it’s time to rethink your strategy. Learn what outreach methods and sales tactics are working, and focus only on those activities.
How to set KPIs for your sales team
Setting KPIs for your sales team is a two-step process:
- Select the best KPIs based on your business needs.
- Implement the KPIs in such a way that it becomes an essential part of the sales team culture.
Hopefully, after looking through our top 20 KPIs for sales success, you have some idea of which ones you’d like to measure. Now, let’s take a look at best practices for implementing your chosen KPIs.
Implementing KPIs for your team
Whenever you make any changes to how your sales team operates, clear communication is crucial. Especially when it comes to KPIs, it’s easy for sales reps to see the addition of new sales goals as a sign that they aren’t doing a good job. You’ll need to explain why you’re measuring the KPIs and convey that they’ll actually make their jobs easier by giving them all a common goal to work towards.
Here are a few best practices to remember:
- Bring in the entire team: Don’t pass down the KPIs to your sales managers and expect them to integrate them right away. Take the time to bring everyone together and explain the goals of the specific KPIs you’re suggesting. You may find that you should shift focus from gathering new clients to retaining your current ones, for example. To be successful as a team, everyone must be on the same page.
- Assess your KPIs: Like any new practice, a new KPI must be evaluated from time to time—you need to know if it’s making an impact. Set a goal and mark it on the calendar, then talk with the team to see what changes are happening and whether your strategy needs adjusting. You can also use sales analytics to measure performance.
- Communicate across departments: Marketing and sales go hand in hand, so your marketing team needs to know when your sales team is switching tactics. If your marketing team is trying to entice new buyers and your sales team is focusing on upgrading current customers, it’ll create confusion and frustration—and you’ll end up paying the financial cost.
Set your KPIs with a strong CRM
When looking at any KPI for your company, you need a reliable, comprehensive CRM to house and track your data. Zendesk is here to help. With three different solutions to fit your needs, Zendesk brings easy-to-use software and simple integrations to your team’s fingertips.
- Zendesk Sell is an all-inclusive platform built with your sales team in mind. With automated data capture and full access to customer accounts, capitalizing on leads is second nature. Zendesk also partners with hundreds of other services, including Mailchimp, to help streamline your pipeline.
- Zendesk Suite is a complete customer service solution that scales with your business and provides your team with convenient ways to connect with customers. A ticketing system, messaging capabilities, a community forum, AI-powered bots, and more combine to create a stellar experience—no matter what products or services your company offers.
- Zendesk Sunshine is an open and flexible CX platform that powers the Zendesk Suite and Zendesk Sell. It integrates, automates, and optimizes the entirety of your customer experience.
No matter what KPIs you need to hit in order to propel your company forward, Zendesk is ready to take the journey with you. Request a demo today.