Are you a sales director or sales manager? A founder of a startup who wants to SCALE to the moon? Or a salesperson yourself?
If you work in sales at your organization, you must learn how to create and track pillar KPIs. Tracking KPIs is simple, and it’s an important pulse-check that integrates into your daily, weekly, monthly, and quarterly reporting. Don’t worry – I’m going to unpack all of this and demystify KPIs.
What are KPIs?!
The acronym KPI stands for “Key Performance Indicator.” KPIs are typically represented as numbers, and they are the best way to measure sales success.
And your KPIs will differ depending on your role. For instance, to measure a manager’s success, you might look at sales volume by territory. To measure a salesperson’s performance, you might look at deal win-loss ratio. Each role will have a handful of KPIs to measure and use in benchmarking progress and success.
So, assuming you’re a sales leader, let me ask you…
What are the 5 KPIs you’re tracking for yourself? What are the 5 KPIs your SDRs have? What are the 5 KPIs you have for your salespeople?
Sitting there scratching your head? Not to worry. That’s why you’re here. Today I’m going to share a handful of KPIs to measure for your sales team. And not just any KPIs, but something I call “Pillar KPIs”. These are the pillars on which your sales efforts are built upon.
(Remember: There are totally different KPIs for you as a manager, for your salespeople, and even for BDRs and SDRs. But we’re going to focus on salespeople KPIs in this article.)
Five Pillar KPIs to Set and Measure
Pillar KPI #1 – Sales Activities
A sales activity is a phone call, an email, or even an in-person visit to a prospect. For it to be counted as an “activity” it should be outbound — your salesperson proactively reaching out to a prospect.
How many activities happen each day? Who has the most activities on your team? The least? Are they making 20 calls a day? 50? 100? If you aren’t tracking this, it’s time to start.
Activities is the number one predictor of sales. In other words, if your team isn’t dialing prospects, there’s no way you can make sales. But if they are making calls throughout the day, conversations will happen, meetings will be booked, and sales will close. So again, you have to track Activities as a pillar KPI.
Tip: Be sure to incentivize sales activities. Give awards for prolific dialing. Because more dials should translate to more sales (not always, but generally speaking).
Pillar KPI #2 – Meetings/Demos Booked
All right, calls are being made. Now it’s time to measure the effectiveness of those calls. If, say, 250 calls are made in a single day, your team should be booking at least 20 meetings, depending on your industry.
This is another pillar KPI. And the reason is simple — if your meetings/demos booked rate is abysmal, then something is broken. And you know what they say, “the squeaky wheel gets the grease.”
Once you know part of your funnel is broken, you can work on fixing it. On the other hand, if you find there’s a healthy meeting/demo booked rate, then you know you can scale sales activities.
Tip: You never want to scale a broken funnel. You have to fix the weakest link before investing in other areas. If prospecting activities (i.e. cold calls) are happening, but your team is not booking meetings, it’s time to take a sober look at things like scripts, tonality, urgency, etc.
Pillar KPI #3 – Proposals Sent
Another pillar KPI is the number of proposals sent to prospects. If your team has their cold-calling dialed-in, and they are booking qualified sales appointments, then they should be sending out proposals on a consistent basis.
Look – even with hot leads that are ultra-qualified, not everyone is going to buy. Nothing is certain in the game of sales. But if you have good product-market fit, and you position your offer correctly, then your prospects will want a proposal.
How many proposals are you sending out? This KPI should run at least 50% on meetings; or you should be sending out five proposals for every 10 meetings/demos you hold. Ideally this number would be closer to 80-90%, especially if you’re following the B.A.N.T. qualification method and selling to C-level decision-makers.
Tip: Create urgency around your proposals to close more deals. Get the proposal into your prospect’s hands within 24 hours of your meeting. Then remind them they have a real problem that needs solving, and every day that passes without your product or service is costing them.
RELATED: How to Create Urgency in Sales
Pillar KPI #4 – Conversion Rate / Client Acquisition Rate
At this point, you’re making calls, setting appointments, sending proposals. So what’s left but to close deals and drive massive revenue?
Your conversion rate is a key performance indicator that signals a healthy sales system. In other words, if your team is converting leads into buyers, your system is working as it should. If you’re not converting, then you must reverse engineer your funnel and find out exactly where the choke-point or weakest link is.
For conversions, you should aim for somewhere between 5-10% of cold prospects converting into buyers. In some industries, this will be much lower; in other industries, you might see this number even higher.
Tip: Your sales team will focus on whatever they are being measured on, especially if they have a constant reminder of it. So be sure to print out and post your KPIs in a common area where the whole team can see them.
Final Words on KPIs in Sales
Tracking something is always better than tracking nothing. So even if you aren’t tracking all of these pillar KPIs, be sure you’re measuring at least some performance indicators. And once you are tracking and measuring, be sure you visit these numbers at the close of every week, month, and quarter. Armed with this data, you can make wise business decisions on next best moves.
Hopefully this article on Pillar KPIs has inspired you to open a fresh Excel or Google Sheets spreadsheet and go to town. Just be sure that you don’t make uniform KPIs across your entire sales team. Your junior sales guys won’t be hitting the same numbers as your seasoned sales veterans. So make sure you account for this as you set your KPIs.
And with that — get out there and measure your success!
Until next time…