A golden rule in sales is what you can’t track, you can’t manage or improve. Field sales managers, and sales managers of every kind of sales team need to keep a close eye on the KPIs (key performance indicators) of their teams and individual sales agents.
In theory, that should be easy for sales managers.
We have software and systems for everything. Almost every software solution that’s tailored to the needs of sales teams includes analytics and the means to track and measure performance.
Why is it essential to monitor Sales KPIs?
However, a consequence of our data-driven age is signals getting lost in the noise, especially when managing busy average sales cycles. Too much data and noise can leave Sales Managers, Sales Directors, and VP of Sales unable to track and manage sales efforts that are really important.
Knowing which metrics — or KPIs — to track is an essential skill that for many sales leaders isn’t always easy. How do you know what’s important?
How do you determine the most effective ways for sales reps to spend their time, and improve sales performance?
What should they focus on?
In this CrankWheel — a zero hassle screen sharing web and mobile-based app for sales teams — guest article, we go through a list of 15 actionable and essential KPIs that every field sales manager should track.
15 Essential KPIs for Field Sales Teams
Big Ticket Sales KPIs
1. New Revenue, Year-on-Year (YoY) Growth
- Calculate new revenue based on the amount being generated from new clients, and compare that against the amount of new (increased spend) from account management activity. Track this against the figures one year ago, to calculate year-on-year (YoY) annual sales revenue growth.
- Make this a moveable metric, so every month and quarter, you’ve got a snapshot to report to C-Suite leaders. When sales opportunities and revenue is up the sales team is performing well.
2. New Clients Customer Lifetime Value (CLTV)
CLTV is influenced by how long customers need your products/services, and therefore, how long they are loyal clients. Sales growth is achieved when the CLTV increases.
For example, if your company is a software provider (SaaS) and the monthly rate most customers pay is $1,000 and the average client lifecycle is 5 years, then the CLTV is $60,000. Naturally, when you charge more and clients stay for longer, the lifetime value increases.
3. Sector/Territory New Revenue (Rate of Growth)
Working out the sector/territory new revenue growth is simply a breakdown of what every field sales agent generates that’s new revenue. Usually from new customers, including referrals; although this can also include new revenue from existing customers, which account management activity brings in.
4. Close-Win Rate (Conversion Rate)
A key part of the ultimate metric that sales managers need to measure: How many sales qualified leads convert, as a percentage, compared to the number in the pipeline?
If you’ve got 1,000 leads in the pipeline, but only 10 convert every month, then the team isn’t performing well. This shows that the number of quality leads isn’t high enough, and far too many of these aren’t suitable or haven’t been qualified.
Especially if the sales team are responsible for generating their own leads and closing deals. However, if another team is, such as marketing or business development (an outbound team, booking meetings) then far too many low-value and poorly qualified leads are being sent through.
Ensure the conversion rate KPIs for sales reps is as high as possible. Compare against year-on-year and previous quarter rates to track overall team performance. And then break this down further to individual agents.
Tracking activity is an underrated and undervalued skill. Sure, sales managers need to know conversion rates and CLTV for sales leads; the total revenue value in the pipeline. But none of those metrics are remotely achievable unless sales agents are doing enough to generate leads, new revenue, and bring new business into the pipeline.
5. Number of Calls Made (weekly, monthly, quarterly)
Monitoring the number of outbound (meeting or lead generating) calls a field sales team makes is crucial. As a sales manager, you need to ensure there are enough sales leads in the pipeline to book meetings, based on current conversion rates. For example, if it takes 100 calls to book 10 meetings, then the call rate needs to stay at 100 per week.
Break this metric down to weekly, monthly and quarterly figures. Adjust as needed if a team’s not made enough calls to book meetings, demos or pitches with prospects to hit targets.
6. Number of Emails/Messages Sent
Similar to the above. Especially if sales teams are booking more meetings through emails and LinkedIn messages. Make sure activity rates are high enough to keep the pipeline flowing strongly with new leads, meetings and demos.
7. Number of New Sales Leads in the Pipeline
This is a top-of-the-funnel metric. A rather crucial one. In some cases, a business development team generates the leads (outbound sales). In others, a field sales team is responsible for bringing in new business, usually alongside a marketing team.
Always ensure this number is high enough when compared against conversion rates through the pipeline to bring in the new revenue a company needs, and to check if a sales team is on-target.
8. Number of Meetings/Calls or Demos Booked
This is a micro-conversion rate within the sales pipeline. One of the crucial “signals”, compared to the noise of sales activity. Compare the number of leads to the number of meetings/calls or demos agents manage to book every week. If every agent needs to take 20 meetings a week to convert 20% of them, then check that activity rates are high enough to generate those meetings.
9. Number of Meetings/Calls or Demos Completed
Say a team of sales agents takes 20 meetings/demos a week, but only 16 of them actually happen, then that’s a 20% failure rate. Encourage agents to have a few Plan B meetings in reserve, prospects they might be able to call if a meeting doesn’t happen, to keep the pipeline healthy and moving quickly.
10. Percentage of Referrals from Existing Customers
Let’s assume every agent is looking after 100 customers in every territory. This account management activity is crucial for generating new revenue. From those 100 customers, agents should focus on increasing value, maintaining accounts, and securing referrals. Aim for a minimum of a 15% referral rate for qualified sales leads from existing customers.
11. Revenue Increase (or value) from Existing Customers
Compare expected revenue (CLTV) from existing customers to the new revenue agents generate from account management activity. New revenue comes from encouraging customers to spend more, buy new products or services, or upgrade a current service/product solution they buy regularly.
12. Revenue Increase (or value) from Existing Customers, including Referrals
Add the referral value to the above figure to work out the overall revenue increase agents are generating from existing customers.
13. Average Pipeline Deal Value
Having a clear picture of the average deal value is an important metric for forecasting. Providing deal values are entered into the CRM, a sales manager can report upwards what they are expecting to land in any given quarter. Base this on an achievable percentage of the number and value of deals that are likely to convert, rather than expecting 100% of it to land.
This should also give you an idea of the CLTV for new sales leads, which will help sales managers calculate revenue, and commission payments for team members.
14. Time Spent Selling vs. Other Activity
Time spent selling, whether outbound activity, meeting with clients in the field (account management), or meeting, calls or demos with new prospects should always exceed time spent on anything else. Such as admin, like updating the CRM, or other field-based software.
Make sure you can track this activity — and have a top-level overview of field sales KPIs — especially how field sales reps spend their time.
Are they doing the right things? Are they spending time on activities that add value?
At the end of each day, have they sent enough emails, messages (such as on LinkedIn), booked enough meetings/demos and calls, and talked to enough clients and sales leads?
Selling time should exceed 80%. Other activities, including training, should be under 20%. Stick to the 80/20 rule, or your own company’s version of that.
Ultimate Sales KPI
15. Missed Target, On-Target, or Exceeded
It all comes down to this. Every action a sales reps takes should increase sales leads, generate new business, increase revenue from existing customers, and ensure sales targets are hit, or exceeded.
Missing a target means improvement is needed. Depending on how far they are off-target, training, coaching, or other professional development could be useful. Getting them back on-target should be the aim of every sales manager.
When a sales rep is consistently exceeding their target, then they are doing really well. It could mean they’re not being challenged enough and would benefit from being promoted, whenever possible. Advancement and a salary increase is the most effective way to retain high-performance talent, otherwise you risk valuable employee turnover.
Key Takeaways: 15 Mission-Critical KPIs for Field Sales Teams
- New Revenue, Year-on-Year (YoY) Growth
- New Clients Customer Lifetime Value (CLTV)
- Sector/Territory New Revenue (Rate of Growth)
- Close Rate (Conversion Rate)
- Number of Calls Made (weekly, monthly, quarterly)
- Number of Emails/Messages Sent
- Number of New Sales Leads in the Pipeline
- Number of Meetings/Calls or Demos Booked
- Number of Meetings/Calls or Demos Completed
- Percentage of Referrals from Existing Customers
- Revenue Increase (or value) from Existing Customers
- Revenue Increase (or value) from Existing Customers, including Referrals
- Average Pipeline Deal Value
- Time Spent Selling vs. Other Activity
- Missed Target, On-Target, or Exceeded?
Of course, there are numerous other metrics you could measure. Larger companies often measure dozens more. Smaller businesses and startups work with the most actionable data possible, often relying on CRMs and meetings, calls and emails from sales agents for a clear understanding of the key sales metrics. Keeping a close eye on all of this will ensure your company is healthy and the sales team is performing well.