Measurements / Metrics

Measurements / Metrics

When managing an Inside Sales team or a Sales Development team , there are 2 main methods of measuring their performance: (1) Key (hard facts) Metrics; (2) Soft Skill Measurements.

This Chapter will discuss the first method.

(1)Key (hard facts) Metrics.

·        Response Speed: This is specifically true specifically for inbound leads to measure how long it took the lead qualification team to initially attempt to reach out to the lead. InsideSales.com last year published an article explaining that for specific high level inbound leads the industry best practice is to attempt them within the first 5 minutes. (Note: This is not necessarily true for all inbound leads such as free trial requests).

·         Number of attempts per lead: Not all leads should be attempted the same number of times. For example a lead that directly requested to be contacted should be attempted many times, possibly even 6 or more times. However on the flip side, a lead that attended an educational Webinar run by a technology or strategic partner but did not express direct interest may only require 2 or 3 attempts before determining it is time to move on. I have advised many vendors, to work out exactly what the correct number of attempts should be for all their different leads depending on lead source, profile and behavior.

Then it is important to make sure that the Sales Development team are abiding by these rules and attempting to reach all the leads the correct number of times.

·         Number of Dials: – There are many technologies available in today’s market to assist the management team in monitoring the dial count. The simple fact is that it is a numbers game. The more you dial, the greater the chance you have of finding your next customer. Many managers also measure how many corresponding emails & voice mails were sent along with these dials. This can all be measured daily, weekly or monthly – whatever is preferred by the individual manager.

·         Who is Dialed: If you have a system that scores your leads (for example based on their profile &behavior) then it is easy to measure if they are calling the correct leads. i.e. those with a high score and prioritizing their work load accordingly.

·         Number of Connects – It is important to measure how many dials it takes until the sales rep connects directly with the correct person. This can help you find out the quality of your database contact detail information. It can also give you an indication if the rep is calling at the right or wrong times, especially when working across multiple time zones and countries. This can be measured daily, weekly or monthly – according to your personal preference.

·         Length of Conversations: One method of measuring that the calls made are of good quality is to measure the average length of conversations. This will help you find out of the rep is simply dialing and hanging up (worst case scenario) or if the rep is struggling to get past gatekeepers or the initial introduction is not compelling enough. On the other hand if the call length is too long, especially on initial introductory calls, then maybe the rep is not qualifying enough and is just diving directly into his long sales pitch.

·         Number of Qualified Leads – This is the beginning of the ‘results’ section. It is important to measure how many qualified leads were discovered from all the dialing made. This will give an indication on the database list quality, conversation quality and generally whether or not the inside sales rep has a chance to start building a sales pipeline. This is usually measured monthly and quarterly but needs to be monitored on a regular basis throughout the month to keep the rep on track to reach targets.

·         Number of Qualified Leads accepted by Sales – This metric will show the quality of the qualified leads submitted. The expectation here should be very high and is a key metric in knowing of the rep understands exactly what type of lead is typically a good prospect for the vendor. Even if the closing is performed by the same rep who did the initial qualification this should be measured. This can be done by creating another milestone such as the number of demos given to already qualified leads. It is just as important to analyze the non accepted leads to learn what can be done to improve the qualification process and criteria, thus always making sure the qualification criteria matches the sales teams ‘accepted’ criteria.

·         Number of Sales Accepted Leads entered into Pipeline: – Not all qualified leads will enter into the official pipeline. Some may be a good, qualified leads but not yet ready to enter into the pipeline for various reasons. This should be at a minimum and therefore monitored closely.

·         Pipeline Velocity: – Sales managers must keep a close eye on this section to make sure that opportunities progress through the pipeline towards the higher % chances of closing. Managers should also look for trends. For example if a trend is spotted that shows a high number of leads reach a 40% chance of closing but then constantly get stuck, then maybe that sales rep needs assistance handling certain objections. A healthy pipeline should be spread out allowing the sales rep to have opportunities that can close in the short, mid and long term. It is also important not to have too few opportunities in the pipeline, even if they are large deals.

·         Closed Deals: – The bottom line is important for obvious reasons. We are in a results oriented business and $$$ talk. However I usually split this into 2 categories:

·         Number of Closed Deals: – The preference should always be for a sales rep to be closing a healthy number of deals. This makes sure that they do not put all their eggs in one basket, hoping for the one large value deal.

·         Average Value of Closed Deals: – This is measured to make sure the closed deals are not too small in value, thus showing that the sales rep spent too much valuable time on a small deal when he/she could have spent his/her time more productively. Also, managers should be looking for expansions, up-sells and overall proof that the sales rep has attempted to maximize revenue.

By measuring all of these stages a healthy sales funnel is created.

It is also imperative to do this analysis per rep, per region, per industry per lead generation source in order to get the full picture. 

At every stage it is important to understand exactly why leads did not progress to the next level. This will enable the organization to constantly improve its overall results.

Targets should be set to make sure they motivate the inside sales rep at every stage of the sales process.

‘Gamification’ & ‘SPIFF’ incentive programs are good ways of keeping the team motivated, growing and maximizing their potential.

In a future chapter I will discuss the Soft Skills that should be measured by an Inside Sales Manager / Sales Development Manager. 

Leads don’t get better on their own

Leads don’t get better on their own

Of course we all want to only deal with the ‘low hanging fruit’. Unfortunately this usually does not bring us enough business, and therefore we need to work long term to build a healthy pipeline. This is fundamentally important.

I am still shocked when I meet people who believe that their leads will automatically get better on their own.

Sales & marketing professionals often wrongly assume that their leads will read all of the company marketing / sales collateral and somehow be magically convinced of the vendor’s true value.

Marketing teams expect the Sales team to simply sell with the leads they have been given.

Sales teams expect to receive leads already fully educated, nurtured, and ready to buy.

Also, in my opinion people get confused between two different points. Leads DO qualify themselves to a certain extent. They do this via the information they fill-in on the company website form, their behavior and also simply from their profile.

However, they definitely DO NOT get better with time and move themselves along the funnel without external assistance from the vendor.

Why don’t Leads get better on their own?

I believe this is because of many reasons. Maybe the leads were too busy and forgot all about the vendor; maybe they have more pressing priorities; or maybe a competing vendor made more effort and had a more compelling case.

What can we do to combat this?

Good leads are made, they don’t just fall out of the sky with no effort made.

There are many things that we can do to help leads get better.

Here are a few suggestions:

·         Connect with our leads faster & more often:  before they forget us; or before our competitors grab them; or before they get too busy with other projects.

·         Improve our short & long term nurturing, making sure each lead is in the right track to match his profile & behavior and therefore receiving engaging & targeted messages.

·         Improve our value proposition to maintain interest, even at the initial qualification process.

·         Engage with the lead via the correct channel and at the right time according to the correct lead profile & behavior (social media, phone,  email )

·         Focus our messaging (both marketing and sales) to make it a lot more specific and directed at the individual leads’ needs.

These are just examples and I would be happy to hear some other ways you are helping your leads move along the sales cycle.

BANT vs ANUM - Lead Qualification Methods

BANT vs ANUM

As explained in more detail in my ‘Lead Qualification Criteria’ blog, one of the most commonly used methods for lead qualification is BANT.

However, I have recently been reading a lot about a slight change to this list and a move towards ANUM.

BANT	ANUM
B = Budget	A = Authority
A = Authority	N = Need
N - Need	U = Urgency
T = Timing	M = Money

Today I want to go through ANUM one by one, explain why it is similar, yet also different to BANT and why the order has somewhat changed. (I have color coded the table above to help explain my thoughts)

So, first of all I see them as being a lot similar than at first glance. When first looking at ANUM we only see 2 that are the same as BANT, namely Authority and Need. I would like to claim that really Urgency is an updated version of Timing and that Money is an updated version of budget.

Authority:

Within ANUM we can see that Authority is the first criteria. This is carried over from BANT but has now been given a higher position. This is to show the change in the way we work. We are getting busier and busier all the time and the bottom line is that it is for the best of all concerned if we make sure from the get go that we are talking to the right person. Otherwise we can say all the great things we want but they will not be meaningful for the listener.

Need:

Need has also been moved up a level compared to being third in BANT but significantly we see that it remains after Authority to show that only once we know if they are the right person to speak to and we understand their internal decision making process can we actually determine if they have a business pain that matches our solution. These two go together well and therefore remain a pair in both theories.

Urgency:

Now comes the fun part. I believe that Urgency is similar to Timing but updated to reflect the new way we buy and sell. In BANT we were just concerned with knowing their project timing to help us with our own priorities and messaging, whereas with Urgency we want to know how high up their priority list this particular business pain or need is for them. This is crucial so that we can know whether or not we should be focusing on helping them build the business case and prove ROI. Also, we can see that once again this change has been driven by the fact that people are busier and we want to understand better if this is something they are focusing on now or if it is on the back burner.

Money:

Money and budget sound the same but I see them as fundamentally different. Budget was focusing on whether or not they already have set aside a clear budget for this project thus assuming that they already see the value in our solution or in solving their business pain. However in today’s modern world they don’t always already know they have a ‘need’ or don’t yet see the full added value. Therefore Budget has been updated to Money to reflect the fact that we have to only find out if they potentially have the money to purchase our solution. Then it is our job to prove to them our value and why they should apply to get the fixed budget for this purchase.

Many companies ultimately use a hybrid between these two systems and I usually suggest that companies find the right balance between these two to match their specific way of working. 

Lead Qualification Criteria

Lead Qualification Criteria:

Sales Development Reps (SDR's) don’t use scripts. However, most good SDR's definitely have some notes or a qualification form that they fill in to determine of the lead meets the qualification criteria.

To learn which question you should ask to find out these answers then read my blog post called “Qualification Questions” coming in a few weeks.

Most companies still use the traditional BANT criteria for qualification. (BANT = Budget, Authority, Need, Timing).

(In the future I will be comparing this to the more recently adopted ANUM criteria method so keep an eye out for that future blog as well)

·         Budget

You will need to know whether or not this prospect has the money / budget to purchase your solution / service. Unfortunately I still hear many stories about sales reps that have spent too long working on a specific prospect only to find out near the end of the process that he has no money right now; or that the budgets are closed for another year; or even worse that he will never have that kind of sum to spend on this type of product.

Of course the solution is twofold: Qualify early to make sure no time is wasted (applies to all sections) but also this is a clear opportunity for you to convince the prospect of your full added value and why he should bump it up his priority list.

·         Authority

Traditionally people have always said that this section is there to show us that we should only spend our time with the decision maker. We apparently don’t want to be pitching to a junior intern who has no authority or spending power. However, I slightly disagree with this as I have seen countless examples where the original contact was not made with the final decision maker but with an ‘influencer’ with direct access to the decision maker or with a ‘researcher’ with a specific mandate from someone higher up in the chain to find a solution. In all these cases it is still crucial to know who you are talking with and therefore alter your questions and sales pitch accordingly. The real aim here is not to only find out who is the decision maker but to understand in detail what their decision making process is.

·         Need

Some people assume it means that the prospect knows what he needs and that his ‘need’ or ‘business pain’ matches what you are offering as a solution. Also, our aim here is to dig a bit deeper to find out about their processes, current systems etc.. in more detail in order to find out exactly what their business pains are. Even if they don’t fully know they have a ‘need’. Later in the cycle we then show them how our solution is solving this specific ‘need’ for many other similar companies. This allows us to be very focused for the individual and will also definitely help prove the true value to the prospect.

By knowing this information we can better understand the drivers behind their interest and their reasons for evaluating and (hopefully) ultimately purchasing your product or solution.

·         Timing

I like this category because it helps sales reps prioritize their work. By knowing the prospects preferred timeline the sales rep can vary his pitch accordingly and more crucially learn to allocate the right amount of time to each prospect. If someone is looking to buy in a year from now then you will not follow up again the day after you spoke to them. On the other hand clearly you will prioritize a prospect who is ready to buy now and put more of your attention on him.

Here are a few other factors that are commonly included within the qualification criteria list:

• ·         Other vendors evaluated
• ·         Lead source (where did they come from)
• ·         Pass down process (how did you find them)
• ·         Specific criteria specific to individual solutions:

Of course if you are selling a solution that is only suitable for companies with 20 employees and over then you will have to ask this compatibility / size suitability qualification question early on and as part of your profiling assessment. The same applies for you if you are selling a technical solution that only integrates with certain systems, then you will have to determine of the prospect uses this specific system or not very early on in the discussions.

Focus on your company's definition of a Qualified Lead . This is the crucial hand-off point between marketing / lead qualification team and the sales team, so it’s essential that the teams agree on the terminology and definitions. Every company’s definition of a qualified lead will vary, but it should reflect a combination of traits and actions that indicate a lead is both a good fit for your company and ready to talk to a salesperson. Here’s one way to examine your funnel to assess lead quality and determine whether a lead is ready for sales follow-up:

1.       Good fit    (good fit & interested vs good fit not interested vs bad fit interested vs bad fit & not interested)

2.       Interested

I hope this helps you qualify your leads better and I would love to know what other qualification criteria is important to you and your business.

The Importance of Lead Qualification

The Importance of Lead Qualification and Discovery 

I feel very strongly about this subject and there is no hiding from this fact.

For me this is a massively important part of the sales cycle and not only do I believe that proper lead qualification is important but that it must be done very early in the sales cycle.

In brief, here is why proper and full lead qualification & discovery at the beginning of the sales process is vital:

1)  NEXT!

Mike Brooks, Mr Inside Sales, has many podcasts. I have listened to most of them. They are great and I recommend them to you all.

One of my absolute favorite ones is all about learning to say “NEXT”. It is about learning when to move on and realize that your time can and should be spent in a better manner with a different lead.

The concept here is that many sales reps spend too long with prospects only to find out at a late stage that it is not a good fit for whatever reason. This should have been something they knew about from the start!

I personally still hear far too many stories about people giving demos to prospects before even asking them what their need is, or stories of sales reps spending months or even years trying to close a deal only to find out at the end that they are dealing with the wrong person.

2) Keeping the Sales team focused on what they do best

This point is very similar to the one above, but I am looking at it from the point of view of those companies that split the lead qualification process separately from the deal closing section of the sales cycle. (as mentioned in my first blog “Sales Development & Inside Sales Definitions”).

The main benefit of using this ‘slice & dice’ model is to allow the more experienced Sales team to focus on good quality leads that are ready to enter into the sales cycle proper. It would be a complete shame if they are wasting too much time prospecting, chasing shadows and qualifying inbound & outbound leads instead of focusing their energies on closing the deals that are already in their sales pipeline.

3)    Prepare for Value Alignment and Objection Handling stages in Sales Cycle

The great thing about qualifying a lead thoroughly and correctly is that it allows you to fully prepare for all the future sections of the Sales Cycle and Sales process. By learning about the prospect's pains we can fully align the Value Proposition in future conversations. By learning about the Decision Making Process and their needs & requirements, we can prevent future objections. 

The aim is to make later life easier for yourself, and for the closer, by gathering all the necessary information at this qualification and discovery stage.  

4)  Feedback

I manage a Sales Development team and we are mainly judged by our bottom line numbers. That’s just the way sales teams are judged.

However, one of the other main benefits we bring to the table is that we can give feedback to other departments. (I will hopefully write a full blog just on this subject in the near future)

a.       Sales: By fully qualifying the lead and finding out exactly what their requirements are, what is their timing and who the real decision maker is, the sales team (whether that is the same rep or handed over to a different rep) will be able to direct the conversation correctly and focus his pitch in the on the right subjects and in the best way.

b.      Marketing: By fully qualifying leads the marketing department can learn more about the leads they are generating and thus improve the quality of their lead generation campaigns. Also during these conversations, frequently asked questions or industry specific jargon may be used at this stage of the process that can help the Marketing team with the messaging they use on their website or in their nurturing collateral.

c.       Product Management: When a lead tells us what their exact requirements & needs are, we can give this feedback to the Product team, thus helping them with future versions or feature requests. This is especially true for the unqualified leads (which, in reality, are usually the majority of leads) as maybe they are unqualified because they are looking for a solution that is not yours. The Product team can then decide whether or not there is something that can be engineered to provide a solution for all these people. 

In future blogs I will discuss in more detail how to qualify leads thoroughly and what criteria to use.

Sales Development and Inside Sales Definitions

Sales Development and Inside Sales Definitions

For many people the terms Sales Development  and Inside Sales can have very different and varied meanings.  The definitions can often be interchangeable and are therefore very confusing.

I will briefly explain here the main definitions and try to give them some context.

Inside Sales vs. Outside Sales   and    Inside Sales vs. Telemarketing

The simple definition is that an Inside Sales representative is someone who is acting as a salesman from the comfort of an office or home office as opposed to a field or outside rep who traditionally travels to his clients’ location.

In synch with what I just described I recently found out that the official dictionary definition is:

“Individuals who sell by phone and normally do not leave the office.”

Ken Krogue has a very good article on this subject and simply starts it off by saying:

“The most pragmatic definition of Inside Sales is simple: inside sales is remote sales.”

According to this same article, it is often said that the term Inside Sales was originally coined in order to differentiate itself as being a professional business-to-business (B2B) selling practice as opposed to ‘telemarketing’ which is a business-to-consumer (B2C) practice of calling everyone once with the aim of closing the deal in one go with a fixed script.

Ken Krogue goes on to say that by the late 1990’s Inside Sales was used to differentiate itself from outside sales and has been made possible by the invention of video /  conferencing thus allowing sales reps to share their screens and demo products to prospects without the expensive requirement of travelling to their location.

Sales Development = Inside Sales – Lead Qualification

This form of Inside Sales (Sales Development) refers to a rep whose primary aim is to qualify ‘sales ready’ leads (inbound or outbound) and formally hand them over to a more senior and experienced sales rep who specializes in closing deals. The advantage of this ‘slice and dice’ system is that each rep focuses on his main skills whether that be:  lead generation, qualification, sales development, deal closing, or account management. Many (non SaaS solution) technology companies have adopted this system, thus allowing them to hire more junior (& cheaper) lead qualification reps to learn their trade whilst working on the beginning of the sales cycle and searching for the ‘good’ leads; This, therefore, permits the more senior (& more expensive) sales reps to focus their attention on the qualified leads that are ready to enter a higher level of discussions and usually already interested in receiving a demo and hearing more about pricing.

These lead qualification experts can be called Inside Sales reps, Business Development reps, Sales Development reps or Internal Sales reps. All of these ultimately refer to the same job description as described above.

My blog will focus on this section of the sales cycle and I will use the term Sales Development.

Hybrid Inside Sales

The hybrid model of Inside Sales/Sales Development is very popular nowadays, and is particularly common in technology hubs such as Silicone Valley or Israel as it suits the SaaS model of selling remotely and selling via monthly recurring revenue streams. This new definition of Inside Sales refers to a sales rep who is involved in the entire sales cycle from start-to -finish via the phone, screen sharing & video conferencing technologies; but may from time to time travel to visit a prospect or customer.  According to many people this method seeks to get the best from all worlds.

In my opinion there is no one model that is better than the rest. It is truly a case of finding which model matched your specific requirements.

In conclusion it is important to mention that according to The Bridge Group, Inside Sales & Sales Development are the fastest growing careers with year on year increase in new jobs created & career demand of 54%.

It is easy to understand why Inside Sales and Sales Development are becoming so popular when we consider that they benefit both the company and the individual. Organizations are turning to this model because it is a pure form of professional sales with the added benefit of saving companies time & money on travel expenses. Job seekers are also now choosing this new career path as they see long term growth and increasing demand for their skill sets within today’s modern and evolving market.