More and more companies are learning to take advantage of the power of sales analytics. In fact, “79% of sales teams currently use or are planning to use sales analytics technology to increase efficiency.”
The strong majority of sales teams have decided that sales analytics tools are the way to go, so how can you get the most out of them?
Read on to learn 10 ways to use sales analytics to help your company grow.
Benefits of Sales Analytics
Every action anyone takes in your company creates data. These data points can be a goldmine of insights into how you can refine your business model and buff up your bottom line.
But none of those opportunities is worth anything if you don’t take advantage of them! Tracking, sorting, and storing data in an accessible and comprehensible way can empower leaders to track the business behaviors that are adding to, detracting from, or doing nothing for the bottom line.
Making these connections can help you to double down on your winning behaviors, and eliminate or adjust patterns that are a waste of time or actively harmful to your business success.
How Many Sales Each Sales Rep Makes
A company’s strength is ultimately built on the sales team, and a sales team’s strength is built one representative at a time.
When programs and incentives and everything else is taken care of, the thing that really determines your success is going to be how effective each of your representatives is.
Companies are used to using crude rules-of-thumb for guessing at the effectiveness of their reps like seniority. While seniority may be a useful hint at your most valuable reps, tracking sales per rep can give you a much clearer picture of who’s generating sales and who isn’t.
Sales Targets
Sales targets require you to first set a goal and then keep track of how successfully your team is moving towards achieving that goal.
At first, you might not know exactly what goal to set, but over time using this sales performance metric, you’ll learn about how much your team can accomplish on average and what they can achieve when they’re motivated to do their best.
Growth in Sales Over Time
Changes in your rate of sales are of supreme importance to your company. Tracking growth in your sales rate can isolate moments of extreme significance for you to look into.
Anytime you see a drop or an increase in sales performance, you’ll want to investigate and find out how to prevent potentially fatal losses and how to magnify anything that increases performance.
Cannibalization Rate
When you introduce a new product, there’s always some chance that it will be a competitor not just with other companies’ products, but with your own products!
The more similar your new product is to an old one, the more likely it is to end up pulling sales away from old products.
The cannibalization rate measures how many of a new product’s sales are dragging sales away from old products. By measuring your cannibalization rate, you’ll be able to tell if a hot new product is really benefiting the company versus if it’s just shifting sales from one place to another.
Average Purchase Value
Sales take time and there are only so many hours in the day for sales reps to make them. Sales data analysis metrics like this track how valuable each individual sale is to the company.
You might find that two sales reps have the same number of sales, but produce vastly different amounts of value for the company. Maybe one rep has many low value sales while another has many high value sales.
You may be able to encourage your reps to shift their time away from low value sales and towards making high value sales, to create more company value in the same time and in the same number of sales.
Total Sales
Your total sales metric simply tracks how many sales you’ve made since the beginning of the company. Hopefully, you’ll see more sales over time and an increase in the rate of sales over time!
Tracking total sales can help you achieve insight into which historical company events have produced positive or negative changes in sales.
Sell-Through Rate
Your sell-through rate tracks how quickly you sell an inventory’s worth of product.
For quick sellers, knowing your sell-through rate can help make sure you don’t run out of product and end up losing sales. For slow sellers, this sales analysis can help you adjust the rate of delivery so you don’t end up over-stocked.
Performance of Each Product
Keeping track of how well each of your products performs is key to knowing which ones need to be emphasized or advertised, versus which ones should be phased out or left as a sideshow.
Sales in Each Region
Knowing your sales in each region can help you identify which markets offer greater opportunity for sales to your company.
Even profitable areas may need less emphasis if they’re already saturated and can produce no more sales. Some new areas may be fruitful ground for greater sales while others may be duds.
Time From Quote to Close
Your quote to close rate isolates and focuses on how good your sales team is at closing. If your team is effective at producing leads and getting to quotes, but is lacking in moving from quotes to close, you may need to adjust what kind of sales training you emphasize.
On the other hand, you might find that your team is brilliant at closing and your company would benefit by producing more leads for your sales team. If you have a brilliant sales team, you don’t want to end up wasting this rare resource.
Sales Metrics to Take Your Business to the Next Level
We hope you learned something helpful about sales analytics in this short piece. To learn more about how to collect data and get the most out of it in your business, check out our other articles!