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The Right Sales Analytics For B2B High-Tech Companies

by Darren Cunningham, Director, Product Marketing, LucidEraThursday, June 25, 2009

A lot has been written over the past few years about the importance of the right metrics to SaaS company success. If you've ever worked for a SaaS technology company, you understand the need to track metrics such as total contract value (TCV), annual contract value (ACV) and monthly recurring revenue (MRR). If these abbreviations are new to you and you're interested in the topic, be sure to read "SaaS Metrics: SaaSoNomics 102A." But what about the metrics that matter to any business-to-business technology sales organization – whether you’re selling an on-premise or cloud-based solution? Surprisingly, B2B technology sales organizations (that actually consider more than quota attainment) typically stop at activity-oriented metrics that have more to do with connected calls than bottom-line results.

Here are some examples of sales metrics that will not only help you get more from your sales force automation (SFA) and customer relationship management (CRM) systems, but more importantly, they will help you increase revenues, decrease pipeline risk and improve your forecast accuracy:

Pipeline Metrics

Win Rate Analysis

By looking at your current and historical win rates by deal size, you can determine whether your sales team should focus on larger or smaller deals.  This will have an impact on the structure of your team and help you focus on the opportunities where you have the highest chance of winning.  Of course it may also impact product pricing, industry focus and sales training requirements.

Stalled Deal Analysis

Analyzing how your current and historical deals have moved since a specific point in time will help you reduce pipeline risk and focus on the right type of opportunities earlier in your sales process.  In this economic climate, it’s become increasingly important for sales managers (and reps) to know how your pipeline has moved since the beginning of the quarter; what early, mid, and late-stage pipeline looks like over time; where are deals getting pushed; and where are they getting stuck over time.

Aged-Out Opportunity Analysis

By looking at win rates by the age of your deals, sales managers and reps will be able to better predict future results.  I’ve seen sales teams that had more than 30 percent of the deals in their current pipeline that have been there more than 200 days, which historically had only a 10 percent win rate.  With this information at your fingertips, you’ll be able to go back and re-qualify deals that are approaching a certain amount of days in your sales pipeline and work more closely with marketing to optimize and improve the overall process.

lucidera digital dashboard panel

Sales Rep Performance Metrics

According to CSO Insights, heading into 2009, 41 percent of sales reps were failing to make quota, 70 percent of reps were taking at least seven months to ramp up, and 86 percent of companies had higher sales targets.  In light of these numbers (which I suspect have only gotten worse over the past few months for most sales organizations), here are some examples of sales metrics that can lead to improved sales productivity, new revenue opportunities and increased forecast accuracy for high-tech companies:

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