Metrics that matter: How Mea

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There are an endless number of ideas on how to improve sales. Rather than add another idea to that already endless list, this webcast will expand upon the idea that measurable improvement can only come from well-measured results. The best ideas on how to improve the sales at your company come from data about your sales - data that's specifically tuned to the most important parts of your process.

You will learn how CRM metrics can give your sales leaders the data they need to identify areas where teams or reps are underperforming as well as where they are excelling, and the general ways that CRM data can contribute to a sales strategy that leads to consistent improvement.

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Metrics that matter: How Mea

  1. 1. Metrics that Matter How Measurable, Actionable CRM Data can Improve Your Sales Presented by: Andy Schultz Invoc www.invoc.net aschultz@invoc.net 713-240-3549 Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  2. 2. If you don't know where you’re going as a business, it's impossible to plan a CRM strategy that will support it. - Geoffrey James, Selling Power Tools aside, CRM is 30 percent technology, and 70 of how to run your business and your strategy for engaging with customers. That 70 percent is invaluable. - Brad Wilson, CRM General Product Manager, Microsoft Business Solutions, quoted in Destination CRM Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  3. 3. CRM is a tool. In the right hands, that is, in the hands of someone who knows what's important to success in his/her business, it can be a powerful enabler. This is particularly true of sales leaders. Sales 2.0 is a sales strategy that uses the technology available to sales teams today to improve visibility, efficiency, and accountability. Given that definition, Sales 2.0 and our discussion about Metrics that Matter to sales leaders today are very mutually relevant and related. Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  4. 4. Sales VP: Mack • Achieved success as a salesperson with a pocketful of business cards and a lot of hard work • Powerful and persuasive personality • Little patience with or desire to use technology • After promotion to VP, his company faced serious turbulence from the economic downturn • Was not able to leverage the tools available to him to help his team. Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  5. 5. Mack didn’t understand this reality: Selling is shifting from a freewheeling organization to a culture of accountability. Whether it is the optimization of sales pipelines, the resizing of a territory or performance monitoring to reward the right sales behavior at the right time, [today's modern sales organizations can] increase accountability for all stakeholders while reducing costs. Armed with precise data ... sales managers will no longer act on hunches but will manage by metrics and hold their salespeople’s feet to the fire. - Pelin Thorogood and Gerhard Gschwandtner, Inside CRM http://www.insidecrm.com/features/sales2- improve-business-112508/ Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  6. 6. Sales Pipeline Report: • breaks the potential sales opportunities your sales people are working on down into their current stages in your sales process • shows the potential revenue for each of the stages • made possible by keeping track of opportunities in CRM, along with potential revenue and sales stage for each opportunity Sales Pipeline $1,410,500 $600,000 $400,000 $200,000 $0 Qualify Develop Needs Propose Close Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  7. 7. Product Pipeline Report Widget A Widget B Widget C $637,500 $477,000 $467,000 $250,000 $250,000 $180,000 $160,000 $200,000 $200,000 $140,000 $120,000 $150,000 $150,000 $100,000 $80,000 $100,000 $100,000 $60,000 $40,000 $50,000 $50,000 $20,000 $0 $0 $0 Qualify Develop Needs Propose Close Qualify Develop Needs Propose Close Qualify Develop Needs Propose Close Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  8. 8. 2010 Pipeline Velocity Qualify Develop Needs Propose Close 22 Days 28 Days 34 Days 16 Days Overall Velocity: 106 Days Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  9. 9. Pipeline Velocity: Aaron Stevens Qualify Develop Needs Propose Close 26 Days 36 Days 31 Days 12 Days Overall Velocity: 113 Days Pipeline Velocity: Victoria Marsh Qualify Develop Needs Propose Close 22 Days 28 Days 34 Days 16 Days Overall Velocity: 98 Days Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  10. 10. Pipeline Probability Qualify = 25% Develop Needs = 50% Propose = 75% Close = 95% Weighted Revenue: Est. Revenue = $100,000 Probability = 50% Weighted Revenue Forecast = $50,000 Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  11. 11. Probability Based on Accumulated Data Opportunity Opportunity Opportunity CRM Opportunity Qualify = 12% Develop Needs = 41% Propose = 63% Close = 79% Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  12. 12. Sales Pipeline $1,410,500 $600,000 Sales $400,000 Pipeline $200,000 $0 Qualify Develop Needs Propose Close Pipeline Probability Pipeline $250,000 41% $200,000 63% Weighted by $150,000 12% 79% $100,000 Historical $50,000 $0 Probability Qualify Develop Needs Propose Close Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  13. 13. Sales Forecast Report • Typically organizes sales by estimated close date into months or rolling “30 – 60 – 90” buckets • Estimated Close Date – a subjective value, which may be negative for some companies, but may work very well for others • Because the estimated close date for an opportunity is subjective, a sales leader can use this report to hold reps accountable for their forecasting when they don’t come through • Often used in concert with a pipeline report Sales Rep 30 60 90 Grand Total A Tillman $89,000.00 $120,000.00 $209,000.00 B Smith $84,500.00 $84,500.00 J Adams $136,000.00 $224,000.00 $360,000.00 J Roberts $77,000.00 $77,000.00 K Bright $95,000.00 $95,000.00 L Gregory $152,000.00 $152,000.00 M Baxter $67,000.00 $75,000.00 $142,000.00 O Locke $77,000.00 $65,000.00 $142,000.00 P Timmons $103,000.00 $94,000.00 $197,000.00 R Hull $88,000.00 $88,000.00 S Birch $101,000.00 $101,000.00 S Marcus $76,000.00 $76,000.00 S Nesmith $96,000.00 $96,000.00 T Barney $96,000.00 $99,000.00 $195,000.00 T Bingham $86,000.00 $86,000.00 Grand Total $805,500.00 $835,000.00 $460,000.00 $2,100,500.00 Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  14. 14. Activity, Time and Expense to Close Opportunities • CRM enables reps to track the activities they execute to progress and close an opportunity – i.e. phone call, appointment, email and task activities. • Reps can track the amount of time spent on each of these activities, allowing that time to be aggregated for the opportunity as a whole. • Using the cost of the rep’s time to the company, the hours it took to work the opportunity, and the revenue from the sale, you can get a good idea of the profitability of the opportunity. • You can then identify the types of opportunities that have the greatest profitability, and pursue those with more focus. Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  15. 15. Sales Profitability One of the big advantages of Sales 2.0 is that it allows you to create a culture of measurement. The point of examining each step of the sales cycle is to make sure that the company experiences lower sales costs along with higher close rates. In other words, metrics is all about profitability. -Selling Power http://www.sellingpower.com/content/newsletter/article.php?ia=9045 (free subscription required to view) Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  16. 16. Sales Profitability • Calculate the gross margin per individual sale o Are you selling the most profitable items? o Are you selling to the most profitable customers? o Are you able to use profitability data to command the proper funding and attention for your own and your team's efforts? Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  17. 17. Sales Profitability Estimate the actual cost per individual sale Yearly cost of sales efforts / Number of sales reps / 1,920 (work hours in a year for 1 rep) = hourly selling cost From CRM, get the number of hours spent on each sale. Hours per sale X Hourly Selling Cost = cost of sale Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  18. 18. Sales Profitability Base sales compensation on net profit Gross margin of sale - cost of sale = net margin on sale Give reps the ability to see the projected net margin on the sale, and how it effects their commission. The sales rep will now be able to see the commission become smaller based upon the amount of time spent with the customer – or, if the rep manages to increase the size and scope of the deal's profitability, to see it go up. Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  19. 19. Aligning Marketing and Sales Selling and marketing are joining their separate silos into a seamless and completely aligned organization. The core character of the Sales 2.0 world is that it relies on sales and marketing alignment, with shared goals and new responsibilities throughout the sales cycle, from lead generation and qualification all the way to closed deals. In some companies, marketing is held accountable (and rewarded) for transactional business and sales for consultative business. - Pelin Thorogood and Gerhard Gschwandtner, Inside CRM (emphasis added) http://www.insidecrm.com/features/sales2-improve-business-112508/ Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  20. 20. ROI Marketing Lead Opportunity Revenue Campaign Answer Questions such as: • Which marketing activities have the best ROI? • Which marketing activities generate the leads most likely to become closed opportunities? • Which marketing activities generate the leads that close the most quickly? • And more … Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  21. 21. Aligning Marketing and Sales … every lead gets linked to its source, every marketing campaign turns into a quest for improved ROI, every step of the sales process is measured, every sales initiative is analyzed and every method is tested. Selling is no longer the place for amateurs who are afraid of analytics … While amateurs may score an occasional win, professionals deliver predictable results. With the help of Sales 2.0 tools, they are able to replicate their best practices and share them across the organization. Sales 2.0 creates a new breed of professionals that deliver predictability. - Pelin Thorogood and Gerhard Gschwandtner, Inside CRM (emphasis added) http://www.insidecrm.com/features/sales2-improve-business-112508/ Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  22. 22. Conclusion • Using CRM, a sales leader can start with a few metrics and build a more intelligent sales organization gradually. • Intelligence builds upon intelligence. Trouble hearing? Call 1-517-417-5200 Participant Code: 419590
  23. 23. Thank-you for Attending! Free Offer for all Webcast Attendees: CRM Assessment Worksheet: self-assess the quality of your CRM system. http://invoc.net/index21.html Presented by: Andy Schultz Invoc www.invoc.net aschultz@invoc.net 713-240-3549 Trouble hearing? Call 1-517-417-5200 Participant Code: 419590

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