The latest development in sales enablement? If you follow the news – and the money – you know that it’s sales analytics. Vendors ranging from Salesforce.com to start-ups like C9 (recently acquired by InsideSales.com) and 6Sense are generating headlines, and there’s been more than $1.2 billion in sales analytics-related VC funding over the past year.
But haven’t we always “analyzed” sales? What’s really changed?
Gartner defines sales analytics as a system for identifying and predicting sales trends and outcomes, while helping sales management understand where and what salespeople should do to improve, and ultimately, boost revenue.
So now you may be saying to yourself, “I’m already doing that; I’m ahead of the curve!” But the reality is that not all sales data is created equal, and knowing the difference — as well as the distinction between the metrics you can actually manage — make all the difference.
Data By Any Other Name…
Data, metrics, analytics – all the same? We don’t think so.
Metrics are simple, they’re just quantitative measures like quota attainment, or time to close. Analytics is the analysis of those metrics that leads to meaningful insights. These can come in different flavors, like predictive analytics or adaptive analytics. Predictive leverages historical data, and adaptive applies real-time data. These two types of data together create a state-of-the art ‘Sales GPS’ of sorts. The idea is not just to measure things, but also to identify patterns and relationships within the data to help sales managers make better decisions, and achieve more predictable outcomes.
Translating Data into Action
When evaluating team performance, particularly when relying on CRM reporting, sales managers tend to focus on metrics like quarterly bookings or quota achievement. While these are important things to measure, they’re also lagging indicators. If you have no sales closing today, the reality is that your team has probably been under-performing for months.
So what does your CRM data really tell you about your reps? How strong of a negotiator they are? How effective they are at competitive positioning?
Your CRM only tells part of the story – and has ushered in what our colleague Jason Jordan of Vantage Point Performance likes to call, “The Golden Age of Reporting.” Never before have sales managers been able to collect and analyze more data. However our ability to assemble all this data has accelerated far faster than sales management’s ability to use it.
In trying to address this challenge for its own clients, Vantage Point looked at hundreds of reports and sales metrics from leading companies, and asked a single fundamental question: Is this a metric that I can manage? Or another way of looking at it: Can I (or any sales manager) actually change that number through my own actions?
For some key metrics, the answer was clearly, yes! For example, you can choose to make more sales calls each week. Or you can change the number of accounts each of your reps is responsible for. For others, the answer was decidedly no. Vantage Point’s research points to three categories of metrics:
- Business Results: such as revenue, market share, and customer satisfaction. Any number of market and organizational factors influence these numbers, but they cannot be managed.
- Sales Objectives: These can be influenced by your sales team, but require consent on the part of the customer. (I can’t make you buy a product, and I can’t make you be my customer, but I can influence it.)
- Sales Activities: These daily activities that, as a sales manager, can actually be managed and changed. Examples include call volumes, account planning and coaching.
The reality is that as much as we would like to “manage” business results, sales activities – the tasks and behaviors your reps exhibit everyday – are really all that you can control. (Despite our best efforts, we simply can’t “manage” revenue. If we could, every rep would make their quota, right?)
The good news is that there is a clear cause and effect relationship between activities and business results that data driven sales managers can actively impact. It starts by defining the desired result, tied to a sales objective, and the activities most likely to get them there.
For example, if your goal is to increase market share by 5%. You may determine that the best way to achieve that is to increase share of wallet with your existing customers. Now the sales activity is clear: you’re going to adjust your account plans to focus reps’ activities on existing customers and architect a sales plan that helps you sell more into those accounts.
We think data also plays a role by delivering insights that can help sales managers make better coaching decisions in support of their business goals. And technology, particularly mobile, can have a big impact here, offering new ways to super charge your CRM and make the link between coaching and revenue performance.
Qstream’s customers understand all too well that mobile is really a force multiplier – it’s hugely powerful in getting people to engage and can help reinforce core capabilities in some very convenient and impactful ways. Based on rep’s responses to brief Q&A challenges, Qstream’s analytics engine synthesizes thousands of data points in real-time, offering powerful insights on what your team knows and doesn’t know – as well as making that data available and actionable for your busy managers.
Many of our customers are now using the data to make direct correlations between things like engagement and quota achievement, to identify selling styles and even identify the individuals on their teams who can use a hand with specific skills. Think of these as your “people metrics” …literally at your fingertips, letting you proactively adjust investments of time and resources in hiring, training or coaching.
Using these frameworks, architecting a strong sales analytics approach is do-able, and worth the effort. Once in place, according to Bain & Company, you will be:
- Twice as likely to be in the top quartile of financial performance within your industry
- Three times more likely to execute decisions as planned, and
- Five times more likely to make decisions faster.