Depending on your price point, business-to-business (B2B) sales cycles can be long. And sure, it probably will take your reps longer to sell a marketing automation system than a TV — much more is at stake. But I can say with almost 100% certainty that your sales cycles are longer than they need to be.
In my experience, the number one reason that sales cycles are overly long is because managers lack insight into where deals are getting stuck. In fact, according to Marketing Sherpa, 68% of B2B organizations have not identified their funnel. But tracking the right pipeline metrics enables you to gain a clear view of where deals are getting stuck.
I’m recommending five metrics that B2B companies should be tracking, as well as offer some actionable advice about how to leverage these metrics to unclog your sales funnel. By tracking these metrics in Salesforce, you can help your team close deals faster than ever this year.
What this metric tracks: How long it takes a rep to reach out to a lead.
How it can shorten your sales cycle: Whether your reps are tasked to follow up with inbound leads from marketing campaigns, or are powering through lists of leads, it’s important to know how long it’s taking reps to reach out to leads. The longer reps wait to reach out to new leads the longer it will take your team to close deals. It pays to ensure that leads are being contacted early and often.
What this metric tracks: The percentage of outbound dials that actually result in sales-qualified opportunities.
How it can shorten your sales cycle: I encounter a lot of companies that are tracking the number of outbound dials that their sales development reps are making each day. Sure, it’s important to track activity metrics like dials. But at the end of the day, I’m more concerned with how many qualified opportunities reps are sourcing. If an SDR is making a lot of dials but not sourcing a lot of opportunities, it could mean that they’re just not not selling efficiently. Perhaps they’re not following up enough times. Maybe they’re dialing leads at the wrong times. Perhaps their pitch just needs more work. Either way, this metric can help you quickly identify which SDRs are propelling leads through your funnel and which aren’t.
What this metric tracks: The percentage of opportunities that turn into deals.
How it can shorten your sales cycle: This is a great metric because it allows you to identify two important things. First, it lets you see which of your account executives (quota-carrying closers) are best at winning deals. Secondly, it lets you see which SDRs are sourcing opportunities that actually turn into deals. Obviously if you have account executives that aren’t closing enough deals it can be a huge indicator of a problem. But it’s just as important to ensure that your account executives have quality opportunities to work. If an SDR is creating a lot of opportunities that don’t turn into deals it could indicate that the SDR needs some guidance into how to better qualify leads. Clearly, some deals are going to take less effort and time to close than others. It’s important to ensure that SDRs aren’t clogging your pipeline with leads that are going to offer good ROI.
What this metric tracks: The percentage of deals in which prospects aren’t actively looking at competitors.
How it can shorten your sales cycle: Generally speaking, competitive deals are harder to close than deals without a competitor. You have to spend time discussing ways that you exceed the competition. And you often have to wait for prospects to finish a trial or pilot program with competitors. So if a high percentage of your deals are competitive, then it could be clogging up your sales funnel. So it tends to be a good idea to keep this percentage as low as possible. One of the best ways to lower your percentage of deals without competitors is by being “first in.” In one of our recent eBooks, sales expert Craig Elias shared some data that being the first vendor into an opportunity raises your odds of winning a deal to 74%! Simply getting to a prospect before they’ve had time to research your competitors is probably the best way to gain an increase in those valuable non-competitive deals.
What this metric tracks: This metric tracks which marketing campaigns drive the highest percentage of leads that turn into customers.
How it can shorten your sales cycle: Some campaigns are going to generate more sales-ready leads than others. The last thing you want is Marketing investing in campaigns that generate unqualified leads that either don’t close or take forever to close. This metric is so important because it helps Sales and Marketing get on the same page. by knowing which campaigns deliver the most won deals, sales managers can work to ensure that marketing invests more in efforts that are proven to not only drive calls, but actually generate revenue.
Want to learn some more essential B2B sales metrics? Check out our eBook 14 Top Sales Leaders Reveal Their Most Essential Sales Metrics for some insight from industry-leading experts including Jill Konrath, Craig Elias, Matt Heinz and more.
Jesse WestDirector of Lifecycle MarketingRevenue.io
Jesse Davis West is Director of Lifecycle Marketing at Revenue.io, focusing on improving the experience and maximizing the lifetime value for customers across their entire journey. Drawing on 11 years of B2B marketing experience, Jesse is passionate about communication, branding and strategic marketing. He also plays a mean lead guitar and can throw down at karaoke.