Whether it is to gauge the effectiveness of your sales methodology or the efficiency of your sales reps, tracking sales performance is a business priority. It involves monitoring key metrics, evaluating sales strategies, and identifying areas for improvement – and can help you improve sales processes, optimize resource allocation, and drive revenue growth.
In this article, we dive into the different types of sales performance tracking, what they measure, and when you can use them.
The right approach to tracking sales performance should improve both, your sales productivity and the team's morale. The types of sales performance tracking that can help you do so are:
a) Revenue/sales volume tracking
b) Conversions and win rate tracking
c) Sales activity tracking
d)Sales behavior tracking.
In the rest of this article, we dive into these four types of sales performance tracking, and the metrics that fall under each of them.
Outcomes or Efforts: What Should Sales Performance Tracking Focus On?
To improve your sales productivity and boost sales morale, you need to a balance of tracking both outcomes and effort. Here are a few guidelines to help you
For outcome-based tracking, you can track
- Revenue and sales volume
- Conversion and win rates
For effort-based tracking, you can track
- Sales activity
- Sales behavior
By employing a combination of these types of sales performance tracking metrics, you can gain valuable insights into your team’s sales performance and make informed decisions.
However, the right combination will depend on your sales team, its maturity, and the current focus areas for your sales team.
In the next section, we look at each type of sales performance tracking, and the metrics they cover.
1. Revenue & Sales VolumeTracking
Revenue and sales volume tracking form the foundation of sales performance evaluation.
To track them, here’s what you can use:
- Gross (or net) revenue: Gross revenue represents the total revenue generated from sales before any deductions or expenses, while net revenue takes into account deductions like discounts, etc, so you can get a complete picture of how you’re doing on sales.
- Revenue per salesperson: By tracking the revenue (sales or net) of a sales rep or a team, you can track the productivity and effectiveness of each salesperson – relative to the team.
- Average deal size: This represents the average value of each closed deal. Monitoring it over time can help you identify trends and track changes in deal sizes over time. In addition, this can help you understand the value and potential of customer relationships so you can focus and fine-tune your sales efforts.
- Average deal size per salesperson: This will help you assess how each sales rep fares in comparison to the average deal size.
2. Conversion and Win Rate Tracking
This type of sales performance tracking shows you how effective your team is at converting leads and closing deals.
The metrics to consider in this category include:
- Average lead conversion rate: This metric measures the percentage of leads that convert into qualified opportunities or sales. It helps evaluate the efficiency of the lead qualification and nurturing processes.
- Lead conversion rep per salesperson: This shows you how your individual sales reps fare when compared to the average of the team.
- Average win rate: Win rate measures the percentage of deals won out of the total number of deals pursued by your sales team.
- Win rate per salesperson or team: This measures the percentage of deals won by a sales rep or team out of the total deals pursued.
Tracking performance on lead conversion and win rate on an individual level enables you to track performance as well as identify top performers and best practices to replicate.
The next two types of performance tracking focus more on effort than outcomes.
If you’re an early-stage team, or battling tough market conditions, these approaches will bring a balanced approach to performance tracking – ensuring that the focus is not on outcomes alone.
3. Activity-Based Performance Tracking
This type of tracking looks at call and meeting metrics to gain insights into the sales team's activities and level of engagement with customers.
The key metrics in this category include:
- Number of calls made: This reflects the level of prospecting, follow-ups, and communication effort.
- Number of meetings held: This reflects the sales team's ability to qualify leads, present solutions, and advance deals.
- Outreach and success rate metrics: This helps evaluate the effectiveness of written communications and outreach efforts. This includes tracking email open rates and response rates.
4. Behavior Tracking
This type of performance tracking looks at the behavior of salespersons to
- Assess how sales reps fare when it comes to foundational positive sales behaviors
- Track competency improvement, as well as
- Track adherence to best practices.
Tracking these behaviors has a direct impact on revenue outcomes. As per the CSO Insights’ 2021 Sales Enablement Analytics Report, companies that measure competency improvement see a 7% improvement in quota attainment.
To track behavior, you could track
- Sales conversational skills (active listening, asking questions, and handling objections)
- Skills improvement
- Best practice adherence
A conversation intelligence tool like MeetRecord can help you track behavior by analyzing all your sales conversations – to assess how sales reps perform in them.
How Sales Conversation Intelligence tools help you score and track helpful sales behaviors
By using call scoring, you can track how sales reps are performing and improving with regard to key behaviors that impact sales – such as setting the agenda, uncovering pain points, objection handling, etc.
Conclusion
Remember, successful sales performance tracking is not a one-and-done affair – it’s an ongoing effort that requires continuous monitoring, analysis, and iteration. By implementing the right balance of performance tracking, you can improve your team’s morale and sales performance.
A combination of outcome and effort-based tracking provides the right middle ground to do this.
You need to identify the most suitable tracking methods for your specific needs and goals – and for your current growth stage.
Here are a few guiding thoughts:
- If you’re a small and early-stage sales team, you could track sales volumes for outcome tracking, and behaviors for effort tracking. This way, you have your eyes on the big picture while also setting strong foundational behaviors that will help the team grow and improve.
- If you have a more mature sales team, you could track outcomes such as revenue and sales volume as well as conversion and win rates. For effort tracking, you could focus on activity-based tracking to know how efficient your sales activities are.
- If you want to truly measure and optimize your sales process, a combination of all four types of sales performance tracking might be a great investment – so you can get granular visibility into the efficiency of your team and your sales methods.
Technology solutions and data analytics tools can help you streamline the tracking process, provide real-time visibility into sales performance, and empower sales teams to achieve their targets.
Recommended Further Reading:
9 tools to efficiently track sales performance in your B2B business
Essential sales management and reporting tools to track sales performance