Full Guide to Sales Metrics: Why to Track, What to Track & How to Track It

Over the past twenty or so years, sales have undergone a gradual shift from being largely instinct-based to becoming heavily data-driven. 

Advancements in sales technology such as CRM systems, sales analytics platforms, and more have given sales professionals the means to leverage data to extraordinary success. 

Without knowing who to sell to, which products are the most popular, or how consumers are engaging with your company, you’ll quickly flounder under the pressure of selling to random people who may or may not be interested in your product. 

That’s why sales metrics are so important.

In this guide, I’ll delve into everything related to sales metrics. I’ll show you what they are, what you need to track, why you need to track them, and how to track them.

Sales metrics are key performance indicators (KPIs) that track and measure various aspects of your sales process. These metrics can include data such as the number of leads generated, conversion rates, average deal size, revenue growth, and much more. 

Tracking and analyzing these metrics can help you identify weaknesses and also uncover what you are doing well, all of which can provide you with the data needed to fully optimize your sales operations.  

Many sales managers make one mistake again and again: They believe that the sales team must sell more to increase a company's profit. As a result, individuals stay focused on abstract aspects and cannot reach success. Frankly speaking, such an approach may even ruin your whole sales strategy and block your perspectives. 

A balanced view that incorporates metrics for both sales performance and process improvements will better align your team’s efforts with your company's long-term objectives and drive sustainable sales growth.

Want to know how sales leaders such as John Barrows, Samantha McKenna, and Steve Benson drive their sales teams to success? Check out their sales growth strategies here!

Before you choose the right sales metrics for your team, it's crucial to address a few key questions. These are the top three challenges you need to tackle:

• Which Metrics to Use: Determine which sales metrics are most relevant to your business goals and current needs.
• Why Metrics Matter: Understand the importance of each metric and how it contributes to your team's success.
• How to Utilize the Data: Learn how to leverage the insights from these metrics to drive better decision-making and improve sales performance.

As you begin tracking and analyzing your sales data, be mindful not to get bogged down by unnecessary details or overcomplicate the analysis. Focus on actionable insights that can directly inform your sales strategy and decision-making processes. This approach will help you maximize the benefits of your sales analytics while avoiding the pitfalls of analysis paralysis, where excessive data review hinders timely decisions.

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As you can see, data is an essential tool in sales.

Whether you have experience in this field or not, every leader or manager wants to know what sales metrics to measure. So here are 13 essential sales metrics that can change the success rate of your sales team.

This sales metric tracks the total amount of money generated from sales over a specific period of time. It provides a clear picture of overall business performance and revenue generation. Monitoring this metric helps in evaluating how effective your sales strategies are.

Total Sales Revenue is an essential metric to track for financial planning and sales forecasting, helping you to predict future sales revenue.

CLV estimates the total revenue you can expect to earn from a single customer over your entire relationship. Tracking this metric allows you to understand the long-term value of customers and informs strategies for customer retention and acquisition. By knowing the potential revenue a customer can bring over their lifetime, you can make informed decisions about how much to invest in customer acquisition and retention efforts.

Listen to this Outside Sales Talk podcast episode with sales trainer Alice Heiman who teaches her actionable customer retention tactics to drive repeat sales!

CAC calculates the total cost incurred to acquire a new customer. This is essential for understanding the efficiency of your acquisition strategies and ensuring that the cost of acquiring customers is justified by their value. Lower CAC compared to CLV indicates a healthy growth strategy, as it suggests that the cost of acquiring customers is outweighed by the revenue they generate over their lifetime.

Sales growth is a metric that measures the percentage increase in revenue compared to a previous period. It indicates how well you are expanding your sales over time. Tracking this metric helps in assessing the effectiveness of sales growth strategies and market demand.

It can be difficult to grow your sales. One way to do that is to automate any processes you are still doing manually. Take route planning, something that is still done manually by many sales teams. One tool that can automatically plan, route, and maximize your time in the field, cutting down driving time by 20%, is Badger Maps.

With the Badger Maps route planner, you can take your long customer lists and turn them into a drivable, fully optimized route. By optimizing your sales routes, something you can’t do with Google Maps, you will save money on gas and meet with many more customers than you normally would. 

Sales teams have reported that they sell 22% more and drive 20% less when using Badger Maps, in fact, the average team of 10 reps sells $936k more the year they start using the app.

With Badger Maps you can also mobilize your sales CRM software, giving you instant access to important customer information as you work your territory. You can easily sync and leverage data in your CRM, all from your mobile device. 

You can enable a two-way, real-time native integration with the most popular CRMs such as HubSpot, Salesforce, Zoho, Microsoft Dynamics, NetSuite, Insightly, and many more.  Additionally, field sales teams increase their CRM usage by 50% when using Badger Maps.

Sales teams using Badger Maps save 8 hours a week, drive 20% less, and sell 22% more.

Discover the value of Badger Maps by trying it out yourself. Start a free trial or schedule a demo now!

Your conversion rate is the percentage of sales prospects that turn into paying customers. Tracking this sales metric helps in evaluating the effectiveness of your sales process and the quality of leads generated. By improving your conversion rate you can increase your revenue and make better use of your resources.

Check out our guide with 9 tips for converting leads into customers!

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Churn Rate indicates the percentage of customers who stop purchasing or cancel their subscription to your product or service. A high churn rate may signal underlying issues with product or service quality. Bear in mind that your customers can also churn due to seasonality as it’s possible that your product is only of use at specific times in the year.

Knowing your average deal size is a great way to inform your sales strategy. You will be able to see what industries are providing the most revenue and direct more resources there. By analyzing the average deal sizes across different industries, you will be able to determine which areas are generating the most revenue, helping you shape and refine your overall strategy.

It’s important to measure the average time taken to close a deal from initial contact to final sale. Why? Because it provides insights into the efficiency of your sales process and your sales team. 

Having a shorter sales cycle generally indicates that you are more effective across all areas of the sales process such as quickly identifying qualified leads, addressing customer needs and objections, and moving prospects through the pipeline with minimal delays. A longer one suggests you are not effective in these processes, and can ultimately lead to higher costs on your end. 

Win Rate is the percentage of deals won compared to the total number of opportunities pursued. It reflects the effectiveness of the sales team in closing deals. With this sales team metric, you can identify strengths and weaknesses within your team. 

Let’s say certain sales reps have consistently higher win rates, it may be worth exploring the sales techniques they use and sharing these practices with the rest of your team. On the other hand, if win rates are lower than expected, it might be necessary to provide additional sales training to reps.

Your lead-to-sales ratio measures the number of leads that it takes for you to close a sale. Monitoring this sales metric helps in evaluating the efficiency of both your lead generation and conversion processes. The lower this ratio is the more it indicates you are doing things correctly and generating high-quality leads.

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This sales metric tracks the distribution of prospects across different stages of the sales process. Mapping out where your leads currently stand in the pipeline provides valuable insights into the progression of sales opportunities, revealing how effectively you are moving your prospects through the buying journey.

Quota Attainment measures the percentage of sales targets achieved by individual sales representatives or the entire sales team within a specific period of time. This metric can indicate how well you are performing relative to your sales goals, providing you with a clear picture of how effective you are in reaching revenue objectives.

Check out our guide that will help you set more realistic goals in sales!

This metric dissects your revenue streams to reveal how much each individual product or service contributes to your overall sales. Breaking down revenue based on specific offerings provides you with a granular view of your financial performance, enabling you to pinpoint which products or services are driving the most profit and which may need reevaluation or enhancement. 

Tracking this can also help you see which products are underperforming, giving you the data you need to investigate why they aren't meeting expectations. 

Regularly monitoring your sales metrics will not only help you stay on top of your goals but also ensure that your sales efforts are aligned with your overall business objectives. 

Start leveraging metrics in sales now and optimize your sales process. 

Good luck!

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