By now (we hope!), you've already completed your sales forecasting for 2024 and are well on your way to laying the groundwork for a wildly successful year. Sometimes, however, many companies still struggle with gathering the pertinent information they need to accurately gauge the effectiveness of their selling and business development efforts.
Sales have traditionally been an intuition-driven profession, more akin to a guessing game: "What's in your pipeline? What do you think is going to close?" But these days, that approach puts companies and organizations at a significant competitive disadvantage.
In this data-driven era, sales leaders need to make decisions in response to real-world market changes, up-to-date assessments of the marketplace, knowledge of the customer and their preferences, awareness of the competition, and company-wide data trends. Relying on opinion or "gut feeling" means losing ground in that marketplace, particularly when forecasting sales and revenue. If, after a month into the New Year, your company is still "trying to hit a moving target," here are some thoughts.
As the cost of acquiring new customers continues to rise, sales teams are challenged with forecasting more effectively, which often means selling more efficiently. This is what CRMs like HubSpot is designed to do. These tools make data-driven forecasting easier by collecting and using specific metrics to inform all sales decisions, such as:
- Deal Creation
- Sales Activities (e.g., phone calls, email outreach, in-person meetings, etc.)
- Average Revenue Per Sale
- Average Length of Sales Cycle
- Percentage of Revenue from New Business
- Percentage of Reps Achieving Quota
- Sales Leads by Source
- Cost of Selling as a Percentage of Revenue Generated
Using this kind of data can help you and your reps create more accurate forecasts, improve productivity, and save precious resources wasted in pursuing customers who aren't a good fit for your product or service. Implementing a data-driven approach can streamline your sales process in a way that maximizes revenue and business impact – and gives the company's senior leadership, a more accurate picture of what kind of revenue is forthcoming.
Once we gather that data, however, you also need to gauge exactly where your reps are in the sales cycle about managing each particular deal. That's where sales pipeline management software, working with your CRM, enters the picture. One such tool is DealIQ, which allows management to monitor the progress of deals better and more accurately forecast revenue. The system gathers and leverages Seven Imperatives that help determine the likelihood of closing each opportunity, including:
- Who are the buyers?
- Who are the influencers?
- Who's our competitor?
- Why will we win the deal?
- Why will we lose the deal?
- What are the key milestones?
- What have we taught them?
…and it integrates seamlessly with most major CRMs: Salesforce, Hubspot, Microsoft Dynamics, Pipedrive, etc.
However, this transition from intuitive to data-driven processes does not happen overnight for most organizations. When moving to a hybrid sales process, you must understand that your team can't flip a switch and make the change. To adopt this data-driven selling process, your sales team needs to know what you want them to do. They need the knowledge of how to do it. And they need a safe place to apply that knowledge, to practice, fail, and learn. They will need to know how to use new tools, develop new skills, and begin to form new habits, all of which take time and repetition. Your job as the leader is to provide those tools, create those opportunities, and coach your team through the learning process.
You've heard the old axiom, "Knowledge is power." In today's ever-competitive environment, the more knowledge a company has about the dynamics of their new business prospecting and selling efforts, the higher the likelihood that their lofty revenue projections and expectations will be attained. Resources like a good CRM and pipeline management software are keys to unlocking the performance code for your team and generating meaningful data that connects to data-driven sales forecasts … as opposed to hunches and best guesses.
Jim brings over 35 years of sales, management and marketing experience to the "training table." He has coached hundreds of business owners, sales executives, managers, and corporations to help them achieve greater levels of success and productivity. His areas of expertise range from sales and management training in the advertising and sports marketing fields to professional and business-to-business services, continuing education, new business development, staff hiring and assessments.
