If we start with the end point in mind of conversion rate in your sales funnel and how we measure it and compare with others we can quickly learn that some things doesn’t make any sense. Conversion rate varies drastically among companies and industries simply because there are too many variables that impact this ratio.
Certainly one of the most important is the quality of your leads. Because the quantity of leads (number of sales leads you generate in a given period) goes into calculating the conversion ratio – the result will be different from one company to another and from one period to another.
You can improve your conversion from leads to prospects and from prospects into customers or clients by improving the quality of your sales leads.
One of the ways you can start working on this issue is by measuring and segmenting your leads. For example, instead of having a one metric like number of leads you can segment your leads into different groups or categories or segments. The leads generated through online advertising on one website will be a different quality compared to online leads coming from another website. In addition print media will generate different lead quality compared to industry associations’ leads and word of mouth.
In addition to different scores in the conversion rates the average transaction will vary among the segments. The question we need to answer is how much each lead is valuable to our business. We can certainly quantify this metric because we are able to measure the number of leads in each segment, the number of conversions and the average transaction per customer per segment. Now our sales funnel will make sense and you’ll be able to improve your planning and resource allocation. By measuring these few metrics you can reallocate your budget to maximize the revenue both short-term and long-term in your sales pipeline.
This exercise always helps sales managers and business managers improve their sales insight and improve the bottomline. By allocation your budget from the least profitable (in many cases not profitable campaigns) to most profitable campaigns and tactics your sales performance will improve dramatically.
Another point in improving the quality of your leads is that you need to go through these measurements on an ongoing basis. This is not once a year exercise and it needs to change and adjust with your marketplace. Market forces change daily and your lead generation channels and tactics will create different results over time – some of them will improve while others won’t. It is the practice of continuous sales management and sales reporting which helps you stay on track and continuously improve your business.
One of the simplest and most effective ways to measure and manage your sales performance is by using excel dashboard to manage your sales dashboard continuously. Excel dashboard allows you to create your sales reports in a few clicks by simply entering your numbers in Excel and creates professional sales dashboards for your business. Learn more how you can benefit from excel dashboard here
More on Analytics