Three Sales Metrics Marketing Should Own
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The document discusses various sales metrics that marketing should own, including the lead to first meeting ratio, length of time in each stage of the buyer's journey, and win rate analysis. It shows data on these metrics over different time periods and compares win rates at different stages. It also promotes additional resources on improving lead scoring, champion kits, and balancing quantity and quality in lead generation.
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Three Sales Metrics Marketing Should Own
- 1. Sales Metrics Marketing Should Own Copyright 2015 Marketing Advisory Network. All Rights Reserved
- 2. Divide & Conquer Metrics Create Tension 2
- 3. 3 It’s a Constant Tug of War, But It Doesn’t Have To Be
- 4. Lead to first meeting/demo ratio 4
- 7. Length of Time In Each Stage of the Buyer’s Journey 7
- 8. 8 0 10 20 30 40 50 60 70 80 Q1 Q2 Q3 Q4 Lead Demo Technical Selection Proposal Negotiation Average # Days Per Stage
- 9. Win Rate 9
- 10. Win Rate Analysis 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 Q1 Q2 Q3 Q4 Per Lead Per Opportunity Per Proposal Per Competitor A Per Competitor B 10
- 11. Alignment Works! 11 Learn How This Program Shaved 54 Days Off the Buying Cycle: http://bit.ly/1LHMCK9
- 12. You Might Also Value… Three Ways Your Doing Lead Scoring Wrong You Need a Champion Kit Quantity Vs. Quality Lead Generation 12
Editor's Notes
- Welcome. My name is Samantha Stone and I’m the Founder of the Marketing Advisory Network where I help sales and marketing teams grow their businesses together.
- I’m always shocked when I speak to sales and marketing professionals and find that they have very few shared metrics aside from revenue or profitability with their sales peers. Marketers are responsible for leads, unique website visitors and brand awareness. Sales is responsible for the length of the sales cycle, win rate and bottom line closing business. On the surface this makes perfect sense – divide and conquer. But in fact, it’s this black & white division of labor that leads to unhealthy tension and inefficiencies.
- Our resources are like a bone inciting a constant tug of war. It’s exhausting having sales & marketing tug constantly over resources, blame and credit – worse it’s ineffective. it’s time marketer’s took SHARED ownership of these three traditional sales metrics. And yes, in case you are wondering, that’s my handsome Husky, Hunter…
- Marketer’s often think of sales people as hungry dinners sitting at the dinner table, fork and knife in hand pounding the table “we want leads. we want leads”. Entering the sales floor is kind of like entering a fun house full of mirrors that distorts our perception. And while I never met a sales team that didn’t want more leads, what they really want is more opportunities. Executive pressure to increase leads often comes at a cost – the passing of poor quality leads that don’t align to target markets and buying intent. We’re obsessed with working backwards. If I need to produce $1,000,000 in revenue and I know my average deal size is $100,000 I need to close 10 deals. To close 10 deals I need to find 100 opportunities. To find 100 opportunities I need to find 1000 leads. To find 1000 leads I need to…you get the idea. Sounds familiar doesn’t it… While a valuable exercise for budgeting and planning this approach takes us away from efforts to improve conversion when used in practice.
- Marketers must be responsible for the ratio of leads to first meeting. When we hold ourselves accountable to maintain or improve this ratio magic happens. We start training sales people on how to follow-up on specific types of leads. We make sure the sales team is well armed with first meeting incentives. We ensure that what they present during those first meetings leaves a lasting impression. We relentlessly follow-up with sales to make sure they are quickly picking up the hand off we sent them. We even focus on finding better quality leads in the first place. On a related note, if you are measuring cost/lead you are probably heading down a dangerous path. I might be able to significantly reduce my cost per lead, but at what cost? Are 100 $5 leads that produce 6 opportunities really better than 100 $20 leads that produce 28 opportunities? What we should be measuring is cost/conversion to opportunity.
- Take a look at this example – what happened in March? Did sales get distracted? Did we introduce a new lead source that tanked? As a marketer would you rather deliver 1,000 leads that converts to 10 meetings or 100 leads that convert to 10 meetings? I’d argue that your credibility with sales and overall organizational efficiency is best when the ratio is lower. Of course there is a minimum threshold of activity we all must maintain – and that is different for each business.
- The second metric is Length of time for each stage in the buying process (typically measured in days) – Even those enlightened marketers who measure the conversion from lead to first meeting – sometimes labeling them Sales Qualified Leads – rarely measure anything between first meeting and the percent of overall leads that result in revenue. This is a huge missed opportunity. All that buyer’s journey mapping we do and we don’t measure how well we’re impacting each stage! By evaluating along the way if we’re reducing the amount of time each buyer spends in the buying stages we are motivated to improve the buyer’s experience with helpful content and resources that match their needs. We improve the delivery and format of this content. And ultimately we better train the sales team to use the tools we’ve worked so hard to build.
- In this example there are 5 stages to the buyer’s journey that are tracked in the CRM system. You can see average number of days between cycles trending over time. It can take a long time to impact these numbers so don’t measure this factor too frequently. Expect 2-3 full sales cycles before you’ll see significant difference. If you average sales process is 30 days you’ll need 60-90 days to see the full impact of your programs.
- And our last metric and one that is so important - Win rate – Too many marketers are afraid to take ownership of the company’s average win rate. It’s deemed outside of marketing’s control and often viewed as a direct result of the sales team’s skills. While sales effectiveness certainly plays a part, owning the win rate can significantly change the behavior of marketers – in a good way. Suddenly we are building content for the last stretch of the sales process. We’re investing in training programs that better align sales actions to target personas. We even pay closer attention to the competition and building a differentiated offering.
- Let’s take a look at an example. Examining aggregate win rate is helpful – but it’s most effective when we watch it over time and look more granularly at Win rate per lead Win rate per opportunity Win rate per proposal Win rate per competitor With these details we can start to see patterns emerge about where we are losing & where we are winning. This allows us to replicate success and learn from loss. For example – check out Competitor A – what’s going on there? Did they just release a new product? Have they changed their pricing?
- If you don’t believe changing your focus on metrics makes a difference check out this case study for one client that shaved 54 days off the buying cycle by following this model. What we measure matters!
- Lastly, I invite you to check out these other related resources.
- Wishing you great success with your new measurements.