When it comes to B2B sales, data-driven decisions pave the way for business success. But how do you know what numbers really matter? And how do you track them?
In this guide, we’re covering the “need to know” about Sales Analytics – the key to measuring sales performance. You’ll learn how to define your key metrics for success, what tools to use, and how to optimize your campaigns for better results.
Whether you’re a seasoned sales leader or just starting out, mastering sales analytics can transform how you approach your sales strategy, making it more efficient and impactful.
What is Sales Analytics?
Sales analytics is the process of collecting and analyzing data related to the performance of your sales efforts and activities. It can be used to both monitor the quality and volume of your sales tasks, as well as the outcomes of your outreach methods and campaigns.
Sales analytics are absolutely essential when it comes to assessing the effectiveness (or ineffectiveness) of your sales efforts – and adjusting your strategy accordingly.
Why is Sales Data so Important?
“Sales data” is what is captured by your sales analytics tools – and can encompass a variety of metrics related to customer behavior, lead generation success, conversion rate, and much more. This data is important because it informs your sales team (and leadership) as to what methods are working well and what needs to be improved.
Put more succinctly, here are a few key reasons why sales data is so important:
- Performance Measurement: Tracks the effectiveness of your sales strategies and identifies your top-performing products, campaigns, and sales representatives.
- Customer Insights: Provides a deeper understanding of your customers’ needs, preferences, and purchasing behavior. This leads to more targeted marketing efforts.
- Forecasting: Helps predict future sales trends, market shifts, and campaign performance, aiding in better planning and resource allocation.
- Optimization: Identifies areas for improvement in your sales process, leading to increased efficiency and closed deals.
- Strategic Decision Making: Drives data-driven decisions that can lead to increased sales and revenue for your organization.
Sales Data Analysis, Made Simple
Sales analytics may sound complicated at first glance, but it becomes simple when you break it down into a few key concepts. These concepts are more qualitative than quantitative, but this thinking will help you make sense of the numbers — and know how to use them!
If you’re just getting started with sales analytics, or want to overhaul your process, keep these concepts in mind:
Trust Your Data
The cornerstone of insightful analysis is the reliability and purity of your data. Imagine a foundation built on rock versus sand; the former supports great structures, while the latter crumbles. Similarly, solid, trustworthy data forms the bedrock of all subsequent insights and decisions.
That’s why you want to use accurate, reliable tools as the source of your sales data. Industry-standard Client Relationship Management (CRM) tools and sales pipeline management tools provide a wealth of data from which to draw from. Reliable tools lead to reliable data, which allows you to make informed decisions regarding your sales strategies.
Define Your “Meaningful Metrics”
Like a compass guiding a ship, identifying the right Key Performance Indicators (KPIs) steers your business in the right direction. These are the metrics that matter most for your business, based on your unique objectives, marketing methods, and audience.
Define your “meaningful metrics” with your team. Which metrics truly capture what you are trying to accomplish? Common KPIs for sales analytics include revenue, sales growth, conversion rates, customer acquisition cost, and customer lifetime value (more on these later). The KPIs you choose should map to your strategic goals, providing clarity and focus amidst the vast sea of available data.
Learn, Revise, Adapt
Insights without action are like seeds without soil—they hold potential but fail to grow. The true value of analytics lies in translating insights into impactful strategies and actions that drive tangible improvements in your sales process.
Take stock of your sales performance. What messaging/content/collateral/tactics are working well? What’s not working? What does this mean for your approach and campaigns?
It’s not just about analyzing data but also about translating insights into concrete actions that can improve sales performance. This includes optimizing sales processes, refining customer targeting, and training your team based on the insights gained.
Tracking What Matters: KPIs for Performance
There are many (and we mean MANY) different KPIs available to monitor the execution and performance of your sales campaigns. It’s important to decide which metrics matter most to your organization based on your goals, outreach methods, and audience.
Some B2B organizations choose to focus on front-end efforts, like lead generation, sales quotas, and appointments booked via their sales teams. Others are more concerned with the end result: closed deals and revenue. And still others focus on a mix of both.
Here are some of the most common and helpful KPIs to track to assess the health of your B2B sales system.
# Appointments Booked
While not directly mappable to ROI, tracking the number of appointments booked by your Sales Representatives allows you to monitor the performance of your team. By tracking the total number of sales appointments scheduled, you can further assess the effectiveness of your team’s lead generation and outreach efforts.
Lead Quality
A high volume of leads is great… unless they’re garbage. Identifying and tracking the quality of your leads is essential when determining whether your lead generation efforts are returning viable prospects. Depending on your system, there are many ways to qualify and score leads.
Lead-to-Opportunity Conversion Rate
This metric measures the percentage of leads that are successfully converted into sales opportunities. You can calculate the Lead-to-Opportunity Conversion rate by dividing the number of opportunities by the number of leads, and then multiplying that number by 100.
For example, if you generated 200 leads in a month and 50 of those leads were qualified as opportunities, your Lead-to-Opportunity Conversion Rate would be 25% ( [200/50] x 100).
Opportunity-to-Win Ratio
Opportunity-to-Win Ratio measures the percentage of sales opportunities that result in closed deals. This provides insight into the effectiveness of your team’s sales pitches and negotiations. You can calculate the Opportunity-to-Win Ratio by dividing the number of wins by the number of opportunities, and then multiplying that number by 100.
For example, if you had 100 sales opportunities in a quarter and 25 of those resulted in closed deals, your Opportunity-to-Win Ratio would be 25% ([25/100] x 100).
Conversion Rate
“Conversion rate” is likely the metric you refer to most often. It is the percentage of leads/prospects that turn into actual customers. A higher conversion rate indicates effective sales tactics and lead management.
To calculate conversion rate:
- Determine the total number of leads generated over a specific period
- Determine the number of those leads that were converted into closed deals (successful sales) within the same period.
- Apply the formula: ( number of closed deals / number of leads ) x 100
For example, if you generated 200 leads in a month and 30 of those leads resulted in closed deals, your conversion rate would be 15%.
The average conversion rate for B2B sales is between 2-5%, but 10% or higher is ideal.
Sales Revenue
Now we’re talkin’ dollars. Sales Revenue refers to the total income generated from sales of your goods or services. It’s a fundamental indicator of business performance and growth. At the end of the day, Revenue and Profit tend to matter most.
Sales Profit
Sales Profit refers to the amount of money your business earns from its sales after subtracting the cost of goods sold (COGS). It represents the profitability of a company’s core business activities, excluding other expenses such as operating costs, taxes, etc. Sales profit is often an indicator of your company’s overall financial health
Customer Acquisition Cost (CAC)
To calculate Sales Profit, though, you need to know your costs. One of those costs is Customer Acquisition Cost (CAC), which is the total cost of acquiring a new customer. These costs might include marketing and advertising expenses, labor costs, and sales expenses. Lowering your CAC while maintaining or increasing customer numbers indicates a more efficient sales process.
Customer Lifetime Value (CLV)
Deal value is one thing, but how much revenue is one customer likely to generate for your business in the long-term? That’s where Customer Acquisition Cost (CAC) comes in. This metric refers to the predicted total financial value a customer brings to your business over the entire relationship. Higher CLV suggests successful customer retention, client satisfaction, and upselling/cross selling strategies.
Churn Rate
How do you factor in the customers who leave? That’s your Churn Rate. It’s the percentage of customers who stop doing business with your company (over a given period). Monitoring churn helps you understand customer satisfaction and adopt strategies that encourage customers to stay with your business.
Sales Pipeline Velocity
Sales Pipeline Velocity isn’t measured as often, but it should be! It measures how quickly revenue is generated in the sales process, from initial contact to closing.
To calculate Sales Pipeline Velocity:
- Determine the total number of sales opportunities in the pipeline for a given period.
- Sum the total value of all deals and divide by the number of deals (i.e. Average Deal Size)
- Divide the number of closed deals by the number of total opportunities and multiply by 100 to get a percentage (i.e. Win Rate)
- Calculate the average time taken from the initial contact to closing the deal.
- Apply the formula: (Number of opportunities x Average deal size x win rate) / Sales cycle length
For example, if the number of total opportunities is 50, your average deal size is $10,000, your Win Rate is 20% (0.20 when used in the formula), and the sales cycle length is 30 days, then your Sales Pipeline Velocity would be 3,333.33, meaning your sales pipeline is generating $3,333.33 in revenue per day ([50 x 10,000 x .02] / 30).
Faster velocity suggests a more efficient sales process.
Best Sales Analytics Tools for B2B
Now, most KPIs can be manually calculated, but who has time for that? With today’s amazing technology, there are many sales analytics tools that make calculating your KPIs practically automatic. With the right system, you’ll have the data you need to effectively monitor sales performance and business growth.
HubSpot
HubSpot is a comprehensive CRM platform, and offers robust sales analytics tools that provide insights into sales performance, track key metrics, and help optimize sales processes. With features like pipeline management, sales automation, and customizable reporting, HubSpot enables you to streamline your sales operations and improve efficiency.
Zoho CRM
Zoho CRM, like HubSpot, is another CRM software that offers a wide range of sales analytics tools. You can easily track sales activities, analyze performance, and gain insights into customer behavior. Many choose Zoho CRM because it provides customizable dashboards, plus real-time reporting, you help B2B businesses make better data-driven decisions and enhance their sales strategies.
Salesforce
Salesforce is an industry-leading CRM platform known for its extensive sales analytics capabilities. It provides detailed insights into every aspect of the sales process – from lead generation to deal closure, sales pipeline velocity to customer churn. Salesforce offers customizable reports, AI-driven analytics, and predictive forecasting, enabling B2B businesses to understand their sales pipeline and improve overall sales performance.
Insightly
Insightly is a versatile CRM and project management tool with sales analytics built in. It offers a range of features, including pipeline management, lead tracking, automated workflows, and extensive integrations. Like many of the other tools, Insightly tracks a wide range of KPIs, all within a single dashboard.
Gong
Gong is a specialized sales analytics platform that focuses on conversation intelligence. You’re able to analyze sales calls, meetings, and emails to better understand customer interactions and sales performance. Gong uses AI to identify patterns, track key metrics, and offer actionable recommendations for your team.
Clari
Clari is a sales analytics and forecasting platform that provides insight into your entire sales pipeline. You’re better able to predict future revenue, identify risks, and optimize your sales strategies to match. Clari also uses AI and machine learning to analyze sales data and offer insights to improve your sales process.
Read more: 20 Best B2B Sales Tools
Reliable Sales Outsourcing with Analytics to Match
Hiring, training, and overseeing a sales team takes a lot of effort — and money. For B2B companies looking to be more lean, outsourcing sales activities is a smart option. Add in the power of reliable analytics and now we’re really rockin’!
At Superhuman Prospecting, we serve as a dependable, affordable, and effective sales outsourced partner to help you land more customers. We offer cold outreach, lead generation, and appointment setting services, tracking our progress every step of the way. We also use our proprietary sales analytics tools to refine our process, leading to better results.
So, are you looking to land more sales without the high costs? Contact Superhuman Prospecting for a free quote today.
