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Sales Statistics That Reveal Sales Effectiveness

Written by: Dave Kurlan

Article Overview: You have salespeople like this! They have plenty of opportunities in the pipeline but very few of them get closed. Some of these salespeople are actually thought to be good closers because they close more new business than anyone else on your team. But are they closing more new business because they're effective closers, effective salespeople or because they simply have more opportunities than anyone else?

Sales Statistics That Reveal Sales Effectiveness

Jeff Angus, author of the Management by Baseball Blog, wrote this lengthy article in response to my Pitch Count post from last week. While Part I of his manifesto explores pitch count as it relates to injury and effectiveness, he brings up another important point. He talks about the best pitchers not learning how to win by not being expected or conditioned to finish the games they start.

There is certainly a correlation there. We have four stereotypical groups of salespeople:

Type Hunt Close
1 Yes No
2 Yes Yes
3 No No
4 No Yes

As you can see from the table above, the Type 1 salesperson also has difficulty finishing, not because of expectations and conditioning, but because of ineffective selling as the salesperson works through the sales cycle. You have salespeople like this! They have plenty of opportunities in the pipeline but very few of them get closed. Some of these salespeople are actually thought to be good closers because they close more new business than anyone else on your team. But are they closing more new business because they're effective closers, effective salespeople or because they simply have more opportunities than anyone else?

This is one of those scenarios where salespeople are seriously misevaluated by management. The question is, if you place their performance under a microscope do you see your best salesperson or your worst salesperson?

If you lack metrics, then the only thing you will see is that salesperson type #1 closed 6 deals last month, double what everyone else closed.

On the other hand, if you have metrics, you can examine conversion ratios:

* suspect to prospect,
* prospect to qualified opportunity,
* qualified to closable and
* closable to closed

The conversion ratios may reveal that Salesperson Type 4 closed only 1 - only one suspect that converted through each phase of the sales cycle. These same ratios could reveal that Salesperson Type 1 may have closed 6, but he had 36 suspects. He appears to be a closer, but in reality, he is only a hunter and his ineffective selling causes him to waste time, screw up or fail to convert a whopping 86% of their opportunities. The salesperson who appears to be your best closer is probably your worst closer! This finding also supports my post from earlier this week on a possible reason why a "top salesperson" could perform poorly on OMG's Sales Assessment.

Referring back to the table at the top of this post, how many of your salespeople are truly type 2 salespeople who consistently find and close a lot of opportunities?

What would happen if all of your salespeople were type 2's?

Did you just experience an increase in sales?

So the question becomes, how do you get from where you are today with your type 1's, 3's and 4's, to where you need to be, with all type 2's?

If you evaluate your sales force, you'll get the answer to that important question! If you act on that answer and more, you'll build a sales organization that will really kick some butt.

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Article Tags: angus, baseball, closers, conversion ratios, correlation, games, important point, lengthy article, manifesto, metrics, microscope, new business, pipeline, pitch count, pitchers, salespeople, salesperson, scenarios



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