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Three Mistakes That Can Prevent You From Hitting Your Sales Goal

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For people working in client services, metrics serve as a vital tool to exhibit effectiveness, enhance reputation, and guide strategy.

However, if your metrics mix does not match up to your month-to-month and year-over-year business goals, you will likely struggle to prove your value or build company momentum. Moreover, because you've been measuring the same way for so long, you may not even realize there's a problem.

If you're struggling to hit the mark, pause for a moment and check to make sure you're not making one of these crucial mistakes.

1. You're not making the offer based on customer-lifetime value

To make a sale, you need to...

  • Reach out to the right audience. You may wonder, "How do I know whether I'm targeting the right people?" To ensure that you contact the right prospects, you must be on the lookout for list or territory issues and do your research. If you are not properly researching and updating your prospect lists on an ongoing basis, you are leaving money on the table. If you are not clarifying sales territory, you are wasting money on inefficiencies. Constant networking and consistent outreach can also help identify the right people.
  • Make the "yes" decision easy for the buyer. Getting a potential customer to say yes to your product or service is never an easy feat. To better understand the difficulties associated with this process, let us look at a potential customer named John.

    You are on the phone with John trying to convince him to buy cable service from you. You tell him about all its exciting features. He seems keen on buying... until you tell him about a strict no-return policy and an additional installation cost.

    If you promised John a 100% money-back guarantee and free installation, he would be much more willing to purchase, but your metrics are attuned to short-term revenue (e.g., get customers in with minimal spend per-customer), so you cannot offer what John would need to get on board.

    In this instance, the offer is wrong because the metrics are off. In this case (selling cable), you should consider working with company stakeholders to adjust the approach to be lifetime-value oriented. The longer term, more critical goal is signing John up as a long-term customer.

2. You're too focused on the "now" numbers

Some sales teams measure performance in short time spans—even on an hourly basis (especially in outsourced sales).

The final numbers are more important than these shorter-term "now" numbers. If you are working to generate as many leads, calls, touches, and even sales as you can in a short time span, salespeople lose sight of the quality. As a result, lifetime-value and depth of sale (e.g., opportunities to cross and upsell) may be negatively affected.

A more circumspect (but effective) way to measure is through "performance to goal" activity metrics, which allow you to track activities against progress toward larger goals. With this model, salespeople and managers can actively gauge whether the team will be ahead, on target, or below a larger target goal. Tracking sales progress this way will allow you to increase teamwork and ease pressure while still allowing for recognition of top contributors.

3. You're not taking cost of sale into account

We have been dancing around this one... Knowing your cost of sale as a percentage of annual revenue generated is perhaps the most crucial sales figure to constantly bear in mind.

By monitoring costs as a percentage of sales, you can see how efficiently product and service sales lead to gross profit and, ultimately, to bottom-line profit.

For example, let's say Sarah made 200 sales for the year. However, 50 of those customers later canceled their relationship with Sarah's firm. Why? Sarah was too hard-pressed on winning the sale rather than taking the time to lock in qualified leads, which can be identified with proper data, research, and even third-party prospecting services.

If Sarah spent more time securing better-qualified sales, she would have avoided the customer turnover that prevented her from reaching her goals. In the end, only half her sales counted toward the margin contribution, and those canceled sales may have even costed her more than the final sales combined.

* * *

Remember that metrics are not a one-size fits all tool. Though they play a major role, they must be adapted to situational needs. When all is said and done, metrics are in place to show your worth. Dedicating the necessary time to thinking and adapting them ultimately will lead to greater productivity and rewards.


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Hugo Bader is vice-president of Business Development at DialAmerica, a privately owned domestic call center company.

LinkedIn: Hugo Bader 

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