No sales leader will dispute that prospecting is critically important to generating new deals and net new revenue. Many sales leaders and sales managers worry their teams are not doing enough prospecting to achieve their sales goals and sales objectives.
Using technologies like the CRM makes it easier to capture data on the sales force and on individual activity. Most of the time, sales managers default to the “more is better” approach to, well, just about everything, but especially cold outreach. This is the problem with prospecting metrics.
Activity Is Everything Until It Isn’t
Ensuring their teams are prospecting, some sales managers require them to make 50 outbound calls, even though most will end in voicemails. They might also require their teams to send 50 cold emails each day, even though these messages are immediately introduced to the delete button and go to wherever emails go to die. At the end of the week, a sales manager with 10 people on their team has data to prove their sales force is prospecting, pointing to the 1,000 activities generated over the course of the week.
Let’s describe this approach to B2B sales as a numbers game. When you believe that success results from activity alone, you might believe the salesperson with the highest activity is the best salesperson, based on their effort. Eventually, believing activity is everything will cause you to fail.
The most common prospecting metrics include:
- Number of calls
- Number of conversations
- Number of emails
- Number of responses
- Number of meetings booked
The truth is that in today’s selling environment sales success is a game of effectiveness.
Improving Your Prospecting Metrics
There are better and more important prospecting metrics than counting activities. Every activity in sales is designed to create an outcome. You are better off worrying about the outcomes than the activity, even though activities are easier to count and outcomes are difficult to improve.
You will do better to focus on the most important prospecting metric: first meetings.
By using activity as your primary metric, it’s easy to believe that your team will succeed. However, when the activity isn’t effective, more is not better than better.
One sales manager I know cared only about activity. Like a lot of sales managers, he grew up in an environment where his manager demanded high sales activity. His sales force was effective and didn’t need the high activity goals he imposed. Eventually, his salespeople all found new jobs.
Activity is important, but it isn’t more important than the effectiveness of the salesperson.
A New Set of Prospecting Metrics
Let’s imagine a new set of metrics designed to improve the sales force’s outcomes. There are three to focus on:
- Number of conversations
- Number of meetings booked
- Conversion rate
Number of Conversations
The first metric, number of conversations, is straightforward. Knowing the number of calls a salesperson makes cannot help you improve your sales results, but the number of conversations can. While the number of calls is a very basic measure of activity, the number of conversations is more representative of potential opportunities. It is important to know this prospecting metric, as you need to use it with the next metric.
Number of Meetings Booked
The outcome of cold outreach is to book a meeting with a prospective client. When combined with the number of conversations a salesperson has, this metric can reveal a lot about their effectiveness. This brings us to our third metric.
Conversion metrics are very important in sales. Think about it this way: One salesperson might have 25 conversations to book three meetings, while another has 10 conversations to book the same three meetings. The first salesperson with 25 conversations has a conversion rate of 12 percent, a low number. The second salesperson converted 30 percent of their conversations, a sign that they are more effective.
Be concerned if your sales force believes that activity is everything. This belief can lead salespeople to continue focusing on activity without ever improving their sales strategies or becoming more effective at commanding a meeting with their prospects.
The Sales Manager’s Prospecting Metrics
Whenever a sales manager uses a metric to assess their sales force, that metric must also create a way to assess the sales manager. One way to do this is to measure the sales manager’s ability to reach their goals. Another way would be to measure the percentage of their team that reaches their quota. There is a prospecting metric that can help managers understand how to improve the sales force’s effectiveness. Using the two salespeople in the scenario above, we can understand how this works.
Current Conversion Rate/Improved Conversion Rate
Let’s suppose that the sales manager provides coaching and prospecting training to the first salesperson, the one with a 12 percent conversion rate. Soon after the sales manager’s training, the salesperson improves their approach and now has a 25 percent conversion rate. This shows that they have doubled their effectiveness, which also indicates that the sales manager is effective because their coaching and training led to an improvement.
Increase in the Number of Meetings
What every sales manager wants and needs is more meetings, so it’s worth measuring the increase in the number of meetings booked as a way to track the sales force’s effectiveness. Every stakeholder benefits from greater sales effectiveness, including the salesperson, their family, their clients, their company, and their sales manager.
What Is the Value of an Activity with No Outcome?
Activity is important, but only a few activities bear fruit. It may make sense to ask for 50 calls to net out the number of conversations, but that shouldn’t be the metric you focus on unless you have an activity problem.
You may do better by setting a goal for booked meetings. For example, you could require your team to book three meetings a week. Some reps may need to make 50 dials to reach the goal, while others can book three meetings with 15 calls. This offers an opportunity for improvement, as the goal is an outcome, not activity. It also incentivizes sales effectiveness.
The Problem with Prospecting Metrics
Most of the cold calling advice salespeople find on LinkedIn isn’t very helpful for salespeople. Using my cold calling script improves meetings from 1 out of 10 conversations to 4 out of 10. You do not need to be any more effective than that to succeed in sales.
In all things, sales leaders and sales managers should optimize the ability to convert from one stage of the sales process to the next, starting with booking first meetings. Without meetings, there is no sales process.
Look at your team’s ability to convert a conversation to a meeting. Then, build a plan to train, coach, and develop the sales effectiveness of every member of your team.