Having solid goals adds power to your sales efforts; it’s the staple of all sales management guidelines. However, oftentimes, the spotlight goes on the wrong sort of goals. According to Vantage Point Performance, only 24 percent of metrics measured by sales leaders contribute to business results. And, the metrics used can’t be directly managed.

As a result, staff find it difficult to meet the goals set, reducing motivation and productivity across the entire sales force. The solution? Focus on inputs and use activities as sales goals.

What are sales activities?

Sales activitiesBetter Sales Results are the actions required to generate your target revenue goals. In other words, they are the activities each sales rep must execute. They are different than quotas, which measure reps by revenue. Here, you’re measuring your team on the number of calls made or outbound emails sent in a day, for example.

In the following Sales Performance Pyramid, you can see that sales activities are the foundation to achieving sales results:

Let’s say you’re a red widget vendor. Your team has a goal of selling $1,000 of red widgets a day. However, after speaking with 13 potential customers, none of them amount to sales. These rejections might make it difficult for your team to keep going, but what if you set an activity-based goal of talking to 20 prospects a day? With this as your new goal, your team still has 7 prospects left to talk to. One or two of these may convert into sales.

This approach to goal setting has two benefits:

  1. Sales reps stay motivated and sharp.
  2. It presents a funnel-like perspective, presenting optimization opportunities.

If your team talks to 20 prospects without making any sales, that’s a problem. Look at various stages of the sales cycle to see what can be improved:

  • Can the messaging be better?
  • Is your team focusing on the right benefits?
  • Are they selling to the right customers?

If you place the focus on things your sales reps can control and measure them on their actions, you’ll keep them motivated. You will also optimize each stage of the funnel, by taking an analytical approach to selling.

How to set the right sales activity goals

Begin with your primary target, the goal your team is trying to achieve. It should have these three components:

  1. Number of sales
  2. Average deal size
  3. Timeframe

We’ll use an example to illustrate how this works. Let’s say you want to make 150 sales at an average deal size of $1,500 in the next quarter. Therefore, your total revenue goal would be $225,000 for the quarter.

Now that you have your true north defined, look at historical conversion rates. How many opportunities have you typically won? Crunch the numbers and see how many opportunities were needed to reach sales goals in the past. Knowing this will show you how many opportunities you will need to fill your pipeline.

Break these opportunities down by activities and measure the conversion rate for each of them. For example, how many calls must your reps make before they get connected? Of these connections, how many convert into appointments?

In the example above, the conversions would look like this:

  1. Out of 300 calls, 50 were connected (16.6-percent conversion from call to conversation).
  2. Of those 50 conversations, 10 agreed to an appointment (20 percent conversion from connection to meeting).
  3. Of those 10, three closed (30 percent conversion from appointment to sale).

This means that from 100 calls, one prospect converted into a customer. To reach the new goal, your reps will need to make 15,000 calls to generate enough opportunities. Find the daily activity goal by distributing those 15,000 calls across the number of working days in a quarter.

Now, your goal is easier to achieve because you’re focusing on what you can do, not on what you can’t control. While this method requires some reverse engineering, it makes setting goals more predictable.

The sales metrics you must measure

Now that you have activity-based goals to motivate your team and increase productivity, you can keep an eye on all the other metrics across your sales funnel. Revenue-per-rep and other bottom line metrics are key. But there are additional granular metrics that sales managers can measure to optimize each layer of the cycle.

Measure these seven metrics while keeping sales reps accountable on sales activities:

  1. Sales funnel leakage: This metric will help identify holes and flaws in your sales funnel. Using the right data, like lead response time and follow-up metrics, can identify what these holes are as well as how to fix them.
    Lead response time and follow-up metrics provide crucial insights. Optimize these areas to convert more opportunities to sales.
  2. Lead response time: Communication has become instant thanks to digital channels, so your leads expect fast response times. According to HBR, leads are seven times more likely to qualify if their enquiries are answered within the hour. And those who wait a full 24 hours are 60 times less likely to convert.
  3. Time spent selling: Uncover new opportunities by discovering the average time reps spend with prospects. If it’s too long, there might be obstacles, like knowledge gaps and the slow retrieval of marketing collateral, blocking them from providing service efficiently. Help your reps get over these blocks with sales enablement systems and tools.
  4. Opportunity win rate: This sales performance metric helps answer key questions about your reps. It identifies which reps struggle to close deals and why, allowing you to focus on empowering them to do better. Listen to their calls or give them one-to-one coaching to tighten areas of weakness. Consider transferring them to other areas of your sales team that align with their strengths.
  5. Length of sales cycle: How long does it take your reps to close a deal? Measure the overall length of the sales cycle as well as individual stages within it. Knowing these metrics allows you to coach your team while optimizing messaging and other sales techniques at each stage.
  6. Sales rep satisfaction: While activity goals show how healthy your sales organization is, the overall satisfaction of your employees shouldn’t be neglected. Boosting morale doesn’t just build a great culture; it helps boost revenue generation. Happy sales reps are high-performing sales reps. Make sure they’re satisfied with the support they’re getting and the environment they’re working in.
  7. Sales volume by demographic: Uncovering more granular metrics about your buyers can further boost performance. Target the most profitable opportunities by location, marketing channel, and vertical industries. Consider the channels that close more than others and the industries that need your products or services the most so you can focus on the more profitable segments of your market.

If you set goals based on inputs, you’ll increase the volume at the top of your sales funnel, create more productive sales teams, and consistently exceed revenue goals.

Which sales activities do you find are critical to generating results? Share your experiences with us in the comments.

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