Applying Smarter Metrics to your Sales and …...22/05/2012& 1 SYSTEMATICALLY TAKING YOUR REVENUE...

22/05/2012

1

SYSTEMATICALLY TAKING YOUR REVENUE GROWTH TO THE NEXT LEVEL

Applying SMARTER

Metrics to your Sales+Marketing Funnel

Bob Apollo

Inflexion-Point Strategy Partners

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Inflexion-Point Experience

›❯  Based in Reading, UK

›❯  Dedicated to systematically improving B2B sales and marketing effectiveness

›❯  Clients are growth-phase B2B-focused organisations

›❯  All are striving to attract, engage, qualify and convert more of the right sort of customers

›❯  Their offerings are usually high-value “considered purchases”

›❯  They face complex buying processes with multiple stakeholders

›❯  They are selling into markets that need educating and want to learn

›❯  Identifying and managing the right metrics is key to their success

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Why Do Metrics Matter?

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ATTRACT ENGAGE QUALIFY

and CONVERT

More of the Right Sort of Prospects

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SYSTEMATICALLY TAKING YOUR REVENUE GROWTH TO THE NEXT LEVEL 5

Construct a Truly Scalable Sales + Marketing Machine


Increase the Return on our Sales and Marketing Resources

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What’s the Opposite of a SMART Metric?

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Focusing on Quantity rather

than Quality

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Confusing Activity

with Progress

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Having Disconnected

Metrics or Separate Sales and Marketing

Funnels

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Unquestioningly using the out-of-the

box-percentage probabilities in your

CRM system

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Doing the same thing over and

over again and expecting

different results

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You Know You Need to Get SMARTER When

›❯  Sales keeps complaining that the leads from marketing are never any good

›❯  Marketing keeps complaining that sales aren’t following up on all the leads the marketing has generated

›❯  Sales people are spending hours every week recreating materials because they don’t want to use the stuff marketing has created

›❯  Marketing is primarily measured and rewarded on the number of leads they generate

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It’s not SMART, and it’s Never Clever When

You hear Sales saying things like

›❯  “The folks in marketing have no idea about the real world”

›❯  “Marketing spends so much money, I have no idea what they do with it all”

You hear Marketing saying things like

›❯  “Sales are asking to go to that trade show again, even though it didn’t work before”

›❯  “Sales have no idea of what we are doing for them”

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You Know There’s Got to be a SMARTER Way When

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›❯  Every new sales win feels like you’ve just been through yet another round of hand-to-hand combat

›❯  You’ve got no real idea of your true Return on Marketing Resources

›❯  Your sales forecast accuracy (and revenue performance) is all over the place

›❯  You’re struggling to bring new sales people (and new partners) up to speed and on target

›❯  It all just feels like far harder work than it ought to

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Why SMARTER Metrics Matter

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Why SMARTER Metrics Matter [Sirius Decisions]

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5

1

3.5

1

20% 29%

Average Organisation Best Practice

SALES QUALIFIED OPPORTUNITIES

CLOSED

Close nearly 1.5 times as many sales qualified opportunities

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19

10

5

1

5.5

3.5

1

49%

20%

62%

29%


SALES ACCEPTED LEADS


CLOSED

Convert 1.25 more Sales Accepted Leads into Opportunities



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15.5

10

5

1

6.5

5.5

3.5

1

65%

49%

20%

85%

62%

29%


MARKETING QUALIFIED LEADS



CLOSED

Sales accept 1.3 times more of the leads passed by marketing

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21

350

15.5

10

5

1

70

6.5

5.5

3.5

1

4.4%

65%

49%

20%

9.3%

85%

62%

29%


INQUIRIES




CLOSED

More than twice as many enquiries turn into leads



22

350

15.5

10

5

1

70

6.5

5.5

3.5

1

4.4%

65%

49%

20%

9.3%

85%

62%

29%


INQUIRIES




CLOSED

5x More

Effective

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SMARTER Metrics Drive Superior Performance

In companies with tightly integrated sales and marketing operations:

›❯  Marketing contributes 3* more of the forecasted pipeline

[Aberdeen]

›❯  3-year revenue growth is 24% faster

[Sirius Decisions]

›❯  Average Win Rates are 38% higher

[MathMarketing]

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Two SMART Principles

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1: If You Don’t Know Where You’re

Going, You’ll End Up Somewhere Else

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2: If You Don’t INSPECT,

You Can’t EXPECT

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Time to Get SMART

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Before we Do: The Funnel

is a flawed

metaphor

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The Flawed Metaphor

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The Funnel Leaks


The Flawed Metaphor

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The Funnel Leaks

Deals Defy Gravity

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The Flawed Metaphor

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The Funnel Leaks

Deals Defy Gravity

Deals Get Stuck


The Flawed Metaphor

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The Funnel Leaks

Deals Defy Gravity

Deals Get Stuck

Deals Enter Late

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Despite this, the concept of the Funnel remains highly

useful - as long as we acknowledge

its shortcomings

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SMART Ideas

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The Basics: Clearly Defined Stages

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1-‐QUALIFYING

2-‐SECURING SPONSORSHIP

3-‐INFLUENCING DECISION CRITERIA

4-‐PROPOSING

5-‐SECURING RECOMMENDATION

6-‐FINALISING TERMS

7-‐SECURING FINAL APPROVAL


The Basics: Clearly Defined Stages

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1-‐QUALIFYING



4-‐PROPOSING




Absolute clarity about what the

prospect is likely to want -‐ and what you need to do -‐ at each stage in the process.

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The Basics: Evidence-Based Milestones

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1-‐QUALIFYING



4-‐PROPOSING




NEED ACKNOWLEDGED

RESOURCES ALLOCATED

DECISION CRITERIA AGREED

SHORTLISTED

SELECTED

TERMS AGREED


The Basics: Evidence-Based Milestones

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1-‐QUALIFYING



4-‐PROPOSING




OpportuniXes should only be

promoted on the basis of observable buying behaviour on

the part of the prospect.

NEED ACKNOWLEDGED

RESOURCES ALLOCATED

DECISION CRITERIA AGREED

SHORTLISTED

SELECTED

TERMS AGREED

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Here’s Why Milestones are Critical: One of the fundamental causes of bad forecasting is misunderstanding the true state of the prospect’s buying decision process – and thinking the opportunity is more advanced than it really is

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Absolute clarity and conformance to defined stages and milestones is critical to success: without this foundation, your metrics will be meaningless

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The Basics: Volume and Value

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Total Pipeline Volume and Value

Volume and Value of Opportunities at Each Stage

Change Over Time


The Basics: the Shape of Your Funnel

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The Basics: the Shape of Your Funnel

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ý þ


Key Metrics: End-to-End Conversion

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Shows how effectively you convert leads into revenue

Reflects quality of leads as well as quality of sales process

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Key Metrics: Stage-to-Stage Conversion

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Shows how effectively you progress opportunities from one stage to the next

Can highlight inefficiencies in stage-to-stage conversion tactics


If You're Going to Leak,

Leak Early

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Key Metrics: End-to-End Time

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Shows how long it takes to convert a lead into a sale

Reflects quality of leads as well as effectiveness of sales process


Key Metrics: Stage-to-Stage Time (Velocity)

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Shows how long it takes to move an opportunity from stage-to-stage

Winning deals move 150% faster than losing deals

Invaluable in identifying sticking points

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Time-Based Metrics

49

90

63

40

23

15

0

Stage 2

Stage 3

Stage 4

Stage 5

Stage 6

Stage 7

Average Days to Closed/Won From Stage

Days to Closed/Won

35%

42%

50%

60%

80%

95%

100%

Stage 1

Stage 2

Stage 3

Stage 4

Stage 5

Stage 6

Stage 7

% of Deals That Go To Close/Won

% To Close/Won

Graphs created by Swayne Hill -‐ DataDrivenSalesManagement.com


Velocity Matters! Time = Money

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Work Backwards Towards your Goals

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Identify how many leads / opportunities you need at each stage (and when) to hit your revenue targets

Take into account leak and lag

Use this to establish your volume and value goals


Systematically SMARTER

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Common Language

›❯  One Funnel

›❯  One Pipeline

›❯  Clearly Defined Stages

›❯  Evidence-Based Milestones

›❯  Ideal Prospects

›❯  Ideal Opportunities

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Key Indicators

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›❯  Change in Volume and Value ›❯  Change in Funnel Shape ›❯  Conversion Rates: End-to-End and Stage-to-Stage ›❯  Conversion rate from Stage ›❯  Velocity: End-to-End and Stage-to-Stage ›❯  Days-to-Win from Stage ›❯  Actuals vs. Goals

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Key Indicators

›❯  Change in Volume and Value ›❯  Change in Funnel Shape ›❯  Conversion Rates: End-to-End and Stage-to-Stage ›❯  Conversion rate from Stage ›❯  Velocity: End-to-End and Stage-to-Stage ›❯  Days-to-Win from Stage ›❯  Actuals vs. Goals

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›❯  By Salesperson ›❯  By Product ›❯  By Geography ›❯  By Campaign…


Investigate Performance Differences

›❯  Compare Salespeople, Products, Geographies, Campaigns, etc.

›❯  Look for patterns of high/low performance

›❯  Drill down into the details

›❯  Identify potential root causes

›❯  Reinforce winning habits

›❯  Eliminate weaknesses

›❯  Progressively elevate overall performance

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Two Final Suggestions

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Key Tool: Opportunity Scoring

›❯  Common Characteristics of Ideal Prospects

›❯  Common Characteristics of Ideal Opportunities

›❯  Select 8-10 Key Predictors

›❯  Weight the Attributes

›❯  Assign Scores

›❯  Corroborate

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Key Initiative: Eliminate the Weakest Links

›❯  Identify the weak links in your Funnel

›❯  Prioritise the most ›❯  significant

›❯  Implement targeted programmes

›❯  Evaluate outcomes and move on to the next problem

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Applying SMARTER

Metrics to your Sales+Marketing Funnel

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Ask us to audit your funnel Bob Apollo Inflexion-Point Strategy Partners twitter @bobapollo email [email protected] web www.inflexion-point.com blog: www.inflexion-point.com/blog test: www.inflexion-point.com/self-assessment

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Applying Smarter Metrics to your Sales and …...22/05/2012& 1 SYSTEMATICALLY TAKING YOUR REVENUE...

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