Your salesperson says, “I have a good feeling this one is going to close, boss!”
You scream, “Feeling? Our whole business is based on your gut instincts, Tony???”
This is a conversation sales teams and their leaders are having each day. Really? This is happening in 2021, when we have software tools, data analytics, artificial intelligence and machine learning?
In 2012, Tech News World published research that revealed more than half of all businesses (54%) expected to improve their sales with CRM. Unfortunately, that is not exactly how it has panned out in 2021.
Why are the sales functions at so many businesses so far behind when it comes to using data to accurately manage revenue generation? Salespeople often see using a CRM as another tool, more work and just another way for their bosses to keep track of them.
The extra time spent entering data into the CRM application adds to the irritation. Salespeople think this keeps them from their main task – selling. In reality, it’s just the opposite.
What Is Data-Driven Sales?
Data-driven sales is the art of using data to make smarter decisions and continuously optimize by using the insights gained from data analysis. By applying data analytics to sales activity, leaders and salespeople understand who to focus on, when and with what kind of messaging.
A data-driven sales process is just like any other process and helps drive behavior derived from data instead of gut feelings. It answers questions like:
- Which prospects should I focus on or qualify out?
- Who’s buying what?
- Where can we apply resources to expedite the sales cycle?
- Which content assets are helping close deals?
- How can we increase our close rate?
By using data streams, like your CRM and marketing automation platforms, you can answer these questions and use the information to continuously impact decisions through the entire buyer’s journey.
Businesses need to make sales decisions in response to market changes, competitor activity, customer preferences and campaigns. And as the cost of acquiring new customers continues to rise, sales teams need to focus on targeted efforts to preserve resources.
What Data Do I Need To Start Reviewing?
At the highest level, look to these six simple metrics that should be readily available:
- Annual total revenue versus target
- Total sales by time period (e.g., this quarter)
- Sales by marketing source
- Average engagement size
- Percentage of revenue from new business
- Percentage of revenue from existing customers
That effort to track and review metrics regularly will help your team start understanding the relationship between data and success. After a few meetings, you can introduce these more granular metrics on a team level and an individual salesperson level:
- MQLs to SQLs
- SQLs to sales opportunities
- Sales opportunities to proposal or quote
- Days from proposal to close
- Close rate percentage
In any Cyclonic Buyer Journey™, it’s critical to match the metrics in each particular stage of the journey to the established goals.
For example, if we track days from proposal to close, we can start to see on average how long that stage takes. If our goal was 60 days or less and we consistently cannot hit that mark, that metric enables sales leadership to stop and say, “Let’s work on that this month.”
Activities like advocacy marketing, better content assets (e.g., the creation of reference reels), enhancements to the proposal or modification of terms and other influencing factors can be tested and applied.
Helping Your Sales Team Become Data-Driven
A sales team that relies on data observes a handful of distinct practices. See if any of these apply to your sales team:
- They always follow the sales process
They know that if they follow a process, they can handle more leads and the experience for all prospects is uniform. When the sales process is uniform, the data from the process is pure and confidently actionable.
- They are obsessed with using the company’s CRM
They know if they all work together to capture information, they can have a powerful data set. Plus, they all benefit from the analysis of that data to make improvements (and more commission!).
- They welcome suggested enhancements provided by the data analysis
Alignment comes with confidence. If they believe in the data, they will be open to trying new techniques or modifying existing tactics.
- They qualify prospects OUT fast
The data tells the sales team which factors indicate the best prospects. Then they can be more selective with the prospects that fit historically accurate criteria. That means less time with opportunities that don’t close and a deeper focus on working with the ones that will.
- They work together as a team
Sales is typically an individual sport, not a team sport. But if the sales team is sharing experiences and matching them to the hard data, they start to learn. And if they share those learnings, the entire sales team operates at a more efficient level (read: more commissions).
Square 2 — Building The Agency You’ll LOVE!