A recent blog post on Harvard Business Review highlighted the importance of efficiently and effectively managing your Sales team:
“In writing the book Sales Growth, we’ve found that CEOs who put sales management at the heart of their agenda have captured astonishing growth — outstripping their peers by 50 to 80 percent in terms of revenue and profitability.”
Their first suggestion to reach these higher levels? Making sure your Sales team has great analytics resources. In fact, the post goes on to say that spending 2-4% of your sales budget is a good target range to spend on an analytics solution. Isn’t that a lot?
Sales Analytics isn’t Stand Alone Analytics
Like anything else your business spends money on, you need to see compelling ROI to justify the spend. The HBR post references a case study of a manufacturing company that saw a 115% ROI after implementing sales analytics. That’s very good, but then we see a recent Nucleus Research study finding that businesses averaged 1209% ROI as analytics became baked into the company as a whole. That’s very, very good. So what does this mean?
The HBR post sheds some insight here:
“Sales organizations can’t drive growth on their own: strategy needs to provide insights into future trends; marketing needs to provide reliable intelligence to identify where to compete; IT needs to develop technology to support remote customer interactions and self-serve capabilities; customer service needs to translate customer interactions into cross- or up-sell opportunities.”
The point is, everyone’s working toward the same goal at your company. One team can’t function well unless all the other teams are too. Sales analytics, while great for your sales team, is also great for, say, Marketing, as insights into lead conversion rate will inform this team for the future. It’s not stand alone, self-contained analytics; the data gleaned from your analytics solution will inform a lot more than just your Sales team. Here’s an example:
Your Sales team sees their Activity Ratio Dashboard and turns out that the Call to Deal ratio is higher for Perry Ellis than Lakeland Financial. Meaning, it takes more effort (in this case, phone calls) to close a deal on the former than the latter, and they saw the same amount of deals from both. Thus, they should be spending more time on Lakeland for the for best efficiency closing deals. This informs Marketing that they need to create new collateral for Lakeland to help Sales reach out to them. Maybe a new web funnel is needed that involves Design and IT hours. It’s just all related.
Spending 2-4% of your Sales budget may seem like a lot for Sales Analytics, but thinking of it as Company Analytics should make the investment more compelling for your business.
Of course, there is always the option of finding a great analytics solution for even less than that. Say, $99/month?