As the world changes digitally and as businesses continue to evolve more quickly than expected, time and precision become paramount in the field of sales. Moving a buyer from the start to the end of your sales pipeline requires more transparency, faster responses, and accuracy of data. Better management of the sales pipeline leads to more visibility and greater motivation to close the deals you need tow in.
FinancesOnline reports that in 2020, the top challenges in sales included a disconnection between sales managers and their teams along with the usual goal of attaining sales quotas. It’s been a difficult time for sales in businesses around the world. In fact, LinkedIn surveyed over 200 sales professionals in 2020. Fifty-five percent of the respondents anticipated a decrease in their sales pipeline, with 14% of those expecting a significant decrease.
Why is your sales pipeline important now more than ever? Because the business world—your prospects and buyers, as well as your competitors—are going digital and moving faster than before. LinkedIn also reports that 81% of sales professionals are conducting more and more video conferencing, with limited face-to-face interactions. Scheduling meetings with your prospects is much simpler than it was just a couple of years ago. Sales professionals need to act fast, and every decision and move they make needs to be strategic—they need all the relevant accurate sales data they can find.
How do you achieve that? The sales pipeline.
Data can also contribute to your pipeline acceleration, and prevent its deterioration.
Data in Your Sales Pipeline
Now let’s look at a few basic things your sales pipeline can do for you:
- Clarifying your sales process. A good sales pipeline gives everyone a clear understanding of how sales happen in your company. As your pipeline gives you more visibility, you’ll further understand where your process works well and where it might need tweaking.
- Tracking of progress. You don’t want to lose track of any of your potential deals. The sales pipeline is a great, data-centric and visible way of making sure everything is in order.
- Alignment with revenue goals. You can very easily see how near or far away you are from meeting your targets. This information helps you make strategic decisions: for which deals should you invest more effort? How fast do you need to move? Do you need more leads?
- Transparency for sales teams. Data is also a great tool to get sales teams working better together. Sales managers can identify bottlenecks and weak points, the reasons behind them, and lead their teams toward better performance.
Why Data is Critical
For your sales pipeline to be truly successful, you’ll need sufficient, timely, and accurate sales data to make important analyses about different aspects of your sales processes and targets.Having the basic parts in place is not enough. Managing your sales pipeline means constantly reevaluating the numbers and making business decisions and changes in your pipeline when needed.
Here are some examples of important metrics, key questions to ask about your pipeline, and the potential impact the data you get can have on your bottom line. The right effort they yield will also spur your pipeline acceleration.
- Total number of opportunities. How many qualified leads are in your pipeline? Does that number reflect a good enough amount of business to meet your sales target? If not, where could the problem be in your process? Determine your priorities.
- Win rate. How many of your qualified leads actually become customers? How does it look so far? This gives you a good picture of how well you are doing.
- Average deal size. On average, how much revenue do the deals that you have won bring in? Think about how your sales team is organized. Is your team optimized to bring in more revenue?
- Average length of sales cycle. Does the entire cycle seem too slow? Which opportunities seem to take more time? What might have caused the delays? Is there something that can be done to speed up the process?
- Customer acquisition cost. How much does it cost to win a deal? Are all of these costs necessary? In what cases is the cost justified? This includes sales operations and marketing expenses. Does it yield a positive ROI?
- Probability to close. This measures the likelihood that a prospect at each stage of the sales cycle will become a customer. How close are you to winning the deal? Focus your efforts on the things that your customer likes, according to the data you got.
There are various tools for managing a sales pipeline, the simplest of which is any application that enables you to create spreadsheets. It’s a good start for small businesses, but insufficient when you’re managing huge amounts of data. There are numerous templates that can help you implement the basics, but they are not for heavier and more detailed data analyses and visualization capabilities you might want to have in place.Some project management tools can also help you achieve good workflows and visualizations, but overall, the standard tool is a good CRM platform.
Getting Better Data
Making strategic decisions is only possible with the right data, and sales data in particular. There are a couple must-haves to achieve this:
- A clean, well-managed sales pipeline. This requires a good process of reviewing your sales pipeline and the right tool and technology for your needs.
- Clear metrics. As an organization, what are your goals? How will you measure your progress against those goals? What might help you make better business decisions?
- Accurate data. Make data a priority in your organization; it needs to be part of the company culture and decision-making process. Ensure that data reported and the management of information are well organized.
Leverage the data you collect at every stage of your sales cycle. This will impact not only your profit and ability to bring in business for your company. With the right strategies in place, you will work smarter, reduce cost, and empower your sales team in the process. Pipeline acceleration will be an unstoppable engine in all your sales and marketing efforts.