However, a KPMG study revealed that 60% of organisations do not have much confidence in their data and analytical knowledge. This means that they do not know whether their business strategy is successful, nor what changes are necessary to remain competitive in the market.
If you feel like this is the time to learn the concepts and formulas of sales KPIs , we've got you covered. In this guide you'll learn:
Sales KPIs are key performance indicators that allow companies to evaluate the performance of a sales team's actions and processes. Their objective is to determine whether objectives were met or whether changes to the strategy are needed.
This sales terminology comes
equatorial guinea email list from English, so sales KPIs mean Key Performance Indicators.
A company's KPIs vary depending on the business model, the size of the company, the objectives set, among other variables. However, the main sales metrics can be considered transversal – that is, they are present in the vast majority of businesses.
You may be interested in reading: 12 sales terms that every professional should know .
What are the most important sales KPIs?
It depends. The most important sales KPIs are those that allow you to evaluate the success or failure of your efforts; and, as we mentioned above, this can change depending on a number of factors.
A company that sells raw materials to others may want to know the total sales volume. On the other hand, a company that sells a subscription service may be more concerned about customer churn. See?
However, there are examples of KPIs that are useful for various companies. Read on to find out what these indicators are.
How are sales KPIs calculated?
Below, we'll give you the main concepts and formulas for sales KPIs. Check them out!
1. Number of leads generated
When a user shows interest in your product or service, they become a lead or potential customer . By sharing their contact information, they pave the way for deeper relationships.
Lead generation feeds the sales funnel . You might think that the more leads you generate, the more sales you make, but this isn't exactly the case.
However, it is crucial that you have a list with the specific data of your potential clients, as well as the total number of leads generated in the period of your interest.
You can extract this data from any of the contact points that the lead has had with the brand, whether through participation in events, downloading content, your own newsletter, among others.
By counting the total number of leads generated , you come into possession of essential data for calculating other sales KPIs that we will see later.
We recommend you read: What is an IQL, MQL and SQL lead?
2. Number of qualified leads
Lead generation transcends the quantitative. In fact, one report finds that only 25% of leads are legitimate and should be converted into sales.
You shouldn't settle for generating a significant number of leads; that's just the first step. It's vital to nurture your potential customers with the knowledge they need to help them make a purchasing decision.
Lead nurturing and lead scoring are essential in these times. If you want to influence your customer to buy your product or service, you first have to educate them on how to use it.
There is no single criterion for determining the total number of qualified leads. The idea is that this group includes those customers who already have all the information necessary to make a purchase.
It's not just about knowing prices. Qualified leads must have received enough content to master how your product or service works, warranty conditions, among other aspects.
Want to know how to identify a qualified lead? Read: What is an MQL?
3. Customer acquisition cost
It is essential to know how much a customer costs. To give you an idea, a Harvard Business Review study revealed that acquiring a new customer can be up to 25 times more expensive than retaining an existing customer.
Customer acquisition cost , also known as CAC , is one of the sales KPIs whose analysis is essential to achieve efficiency.
Sales KPI Formulas: CAC
To calculate it you need to know precisely the total value of the investment made , starting with marketing actions.
Sales costs must also be considered in this total value. In other words, you must calculate the cost of all the actions carried out to attract the customer and complete the purchase.
With the total investment value in hand, you are now ready to divide it by the total number of customers acquired during the period in which this investment occurred. The result is the CAC.
