Sales Metrics: CRM By The Numbers

Sales Metrics: Measuring the wrong things is relatively common in sales, as the typical sales manager evaluates the team based on activity: the number of calls made, emails sent, meetings set or proposals written. The philosophy is that the sales rep with the most activity will be the most successful.

Yet, half of all sales reps don’t reach their quotas, despite satisfying their sales metrics. Clearly, sales managers are measuring the wrong things.

What should they be measuring? Engagement.

Engagement is about communicating to prospects and customers in a way that encourages them to interact with your brand, whether this is by opening an email, liking a Facebook page, attending a webinar or meeting with a sales rep. As prospects develop a relationship with the brand, they move through the “customer lifecycle,” from a prospect to a customer and eventually to a brand advocate.

According to Gallup, organizations that focus on customer engagement out-perform their competitors by 85% in sales growth. That’s because customers who have a relationship with a brand tend to buy more and refer more business.

Measuring a sales team based on engagement comes down to three steps.

1. Target the ideal customer. Engagement starts with targeting the ideal customer. Getting people to engage with your brand is essential, but engaging your ideal audience is what ultimately leads to increased sales. If prospects aren’t the right fit, all the phone calls, emails and meetings won’t make a difference. If you like numbers, here’s one that will work: 80/20. Segment your customers based on the 80/20 rule: 20% of your customers generate 80% of your revenue. Look at what traits the 20% have in common. Rank the sales team only based on interactions with prospects who fit these criteria. Chances are, the sales rep with the most activity will not rank #1 anymore.

2. Develop the right message. Defining your ideal customer will help you refine your message to one that resonates better with your target audience. You have to know their problems before you can sell a solution. A sales rep who has encouraged high levels of engagement and is targeting the ideal customer should be successful. If not, there’s a problem with the message.

3. Implement a measurement system that works. As sales reps begin engaging with prospects, develop a scoring system that assigns points based on fostering the right activity with the right prospect. For example, a meeting with a potential buyer is worth more points than 10 cold calls. Your scoring strategy must reflect what your organization defines as valuable engagement with the right fit candidates.

The Greek philosopher Plato was right when he said: “A good decision is based on knowledge and not on numbers.” The sales team member who best understands the customer and can influence prospects to interact back with the brand will drive sales.