You believe in your sales team.

You know they’re experts in the sales world and that they’re doing everything they can to close more deals and keep more customers.

So how do you prove it?

Or maybe you’re in the opposite situation. Maybe you’re concerned that your salespeople aren’t doing the heavy lifting required to help your business grow.

There’s something missing in your sales equation – and you’re not quite sure what it is.

How do you find it?

The answer to the predicaments in both these situations is to measure and analyze the right sales metrics.

Here’s how to implement sales analytics for your organization!

What is Sales Analytics?

Sales analytics is the process of collecting, studying, and interpreting data about your sales team and overall sales performance.

Using a variety of tools, you can collect data on each individual’s contributions, the performance of the team, and the impact of sales on the bottom line for your business.

From there, you can use graphs, charts, and other visuals to draw conclusions. With those conclusions, you can make decisions.

So what statistics are going to help you do all that?

The Benefits of Measuring Sales Metrics

There are literally hundreds of things you can measure in the world of sales.

Technically, you can measure and analyze the average number of times your salespeople sneeze each day – but it probably won’t help you improve your sales by much (unless there’s some sort of sneezing epidemic holding your team back).

But you should probably narrow your focus to only the most important sales metrics. By focusing on these metrics, you’ll be able to:

  1. Focus on practical outcomes. Okay, so you’ve figured out how many sandwiches per week (SPW) your salespeople are eating. That’s a sales metric, kind of. But it isn’t linked to something practical. It’s not related to your business’s performance or revenues – so it’s probably not worth analyzing.
  2. Form actionable insights. Good metrics also let you form an actionable takeaway.

The 15 Most Important Sales Metrics

So what are the most important sales metrics to know?

That’s going to vary slightly per business, but these are the must-haves.

1. Revenue.

First off, we’ll start with sales performance metrics like company revenue. How much money’s coming in and where is that money coming from?

Yes, it’s important to form good customer relationships and pursue sustainability – but at the end of the day, companies succeed or fail based on the money they’re able to bring in. If your revenues aren’t sufficient, the entire organization will collapse.

By contrast, high revenues can sustain you indefinitely. Your sales team’s ultimate bottom-line priority is company revenue – so it’s vital to measure it.

Recommended tools:

2. Sales growth.

How is that revenue changing over time? You might be on pace to generate $3 million in revenue this year, but is that down from last year’s $5 million? If so, it’s a troubling sign.

You don’t need to grow sales every year to have a successful business, but if growth and expansion are priorities, this metric should be high on your radar.

Recommended tools:

  • Stripe
  • Baremetrics
  • Paypal

3. Quota achievement.

Sales goals are extremely valuable. They provide strategic direction for your team, they inspire your teammates and spur motivation, and they give you a framework you can use to objectively analyze progress. You might even formalize these goals by setting quotas for each individual team member.

It’s important to measure whether your teammates are hitting those quotas – and if not, how close they come to hitting them.

Recommended tools:

  • Hubspot Sales Hub
  • Close

4. Average response time.

Average response time is the average time it takes for your salespeople to respond to a prospect reaching out. The faster this is, the better.

It’s the most important of the sales productivity metrics that you can measure.

In fact, 35-50% of all sales go to the vendor that responds first, and you increase your chances of landing a deal by 700% if you reply in less than 60 minutes.

Recommended tools:

  • EmailAnalytics

5. Win rate.

Win rate refers to the percentage of opportunities that your salespeople are able to close. What counts as an “opportunity” is going to vary, and the odds of success are going to vary based on your industry and other factors.

However, you can study how your win rate changes over time and how it varies between salespeople to learn more about the strengths and weaknesses of your current approach.

For example, if one sales team member has a significantly lower win rate than the rest of the team, they may be in need of additional coaching or guidance.

Recommended tools:

  • Hubspot Sales Hub
  • Close

6. Conversions & conversion rate.

A “conversion” happens when a sales target completes an important action or moves to the next sales phase.

For example, you might count a “conversion” as happening when a prospect completes a form on a landing page, or when a salesperson gets a meeting with the decision maker of a large organization.

It’s similar to win rate, but it doesn’t have to result in an actual sale in all cases.

Recommended tools:

  • Unbounce
  • Intercom

7. Stage-based conversions.

You may also want to measure how many conversions you get at each stage of the sales funnel.

This is called sales pipeline metrics. For example, you can measure conversions at the prospecting stage, the qualification stage, the proposal stage, the negotiation stage, and of course, the closing stage.

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This can help you figure out where you’re losing the most opportunities – and the critical improvements that can eventually help you land more sales.

Recommended tools:

  • Hubspot Sales Hub
  • Close

8. Length of sales cycle.

How long does it take to get an interested prospect all the way to a closed sale? How long does it take to get through each stage of the sales funnel?

Measuring and analyzing these time requirements can help you identify inefficiencies in your system – and discover ways that you can accelerate the sales process overall.

Recommended tools:

  • Salesforce
  • Podio
  • Acquire

9. Average transaction size.

When a salesperson closes a deal, what’s the average size of the transaction they close?

Depending on your organization, there might not be much variance here, and if that’s the case, it may not be worth measuring. However, it may be in your best interest to study average transaction size closely and work on improving it.

Add-ons, upgrades, and better negotiations can increase this value.

Recommended tools:

  • Stripe
  • Baremetrics
  • Paypal

10. Profit margin.

Revenue is a great indication of how your company is performing, but you also need to think about your profit margins.

Your salespeople might have sold $1 million of merchandise, but if your profit margin is only 2 percent, that only represents $20,000 of profit for the business. Conversely, sales of $100,000 with a profit margin of 25 percent would represent only 10 percent of the revenue, but you’d end up with $25,000 of profit.

This can be helpful in setting better priorities for salespeople that lead to higher profitability for the business.

Recommended tools:

11. Sales team productivity.

Your salespeople are here to sell, right? So how much of their day is actually spent selling?

If your business is like most, your salespeople spend a lot of time in meetings, sending emails, completing administrative tasks, and doing other unproductive work.

That’s why it’s so important to measure productivity. There are many ways to measure productivity, including tracking tasks, tracking hours, and even analyzing email activity.

Consider using multiple analytical methods to get more accurate, more thorough results.

Recommended tools:

  • EmailAnalytics
  • Timely
  • Time Doctor

12. Opportunity loss metrics.

Is your sales funnel leaking? Studying sales funnel leakage and other opportunity loss metrics will help you figure that out.

How many prospects are you losing on their journey to become customers and where, precisely, are you losing them? You might find that there’s a significant drop-off of interest during the proposal stage.

Why is this the case, and what can you do to stop it?

13. Customer retention/customer churn.

You closed the deal! Congratulations. All done, right?

Well, in most organizations, sales teams are also responsible for customer retention. The sales process and onboarding process can ensure that customers get started properly – and ongoing follow-ups and conversations can ensure they remain paying customers for as long as possible.

The higher your customer retention rate is, and the lower your customer churn rate is, the more consistent revenue you’ll get from your existing customers.

If customer churn spikes, it’s the sign of a serious – and possibly company-jeopardizing – problem.

Recommended tools:

  • Stripe
  • Baremetrics

14. Customer lifetime value (CLV).

How much is the average customer worth to your business? It can be tricky to figure this out, especially if you’re working with a lot of unpredictable variables.

However, once you know it, you can start to optimize it – and use it to make better strategic sales decisions. The higher your customer lifetime value is, the more valuable each onboarded customer will be, on average.

This is also helpful for contextualizing and better understanding the role of your customer acquisition cost – which I’ll cover next.

Recommended tools:

  • Stripe
  • Baremetrics

15. Customer acquisition cost (CAC).

Customer acquisition cost (CAC) is the average cost of getting someone to make a purchase with your organization. It includes the money you spend on things like marketing, advertising, salespeople’s salaries, and other direct costs.

The lower it is, the more profitable each of your customer acquisitions will be.

Recommended tools:

Sales Analytics Software Tools

Okay, so what tools can you use to measure these sales metrics? Check out these sales analytics tools:

Now that you’re armed with these sales metrics examples and tools, are you ready to learn more about your sales team’s performance?

Start with EmailAnalytics.

EmailAnalytics is a sales analytics tool that illuminates the black box that is your team’s email inbox activity.

It’ll tell you all about your organization’s email activity, including number of emails sent per day, busiest times and days, and even average email response time.

With these sales metrics, you can implement strategies that boost productivity and sales.

Sign up for a free trial of EmailAnalytics today!