I recently chatted with my LevelJump colleague Adriana Romero, Director of Enablement Solutions, in a live webinar about which enablement metrics you need to be paying attention to in 2021.
Here’s what you need to know.
We started by looking at some consumption metrics most enablement teams use, such as content views, video plays, course completion rates, quiz scores, and badges earned. While they all have a place in the enablement metric family, Adriana pointed out that they won’t tell you if someone knows how to overcome objections or position a value proposition. In other words, these don’t really nail down how much the needle moves. And that is what leadership teams want to see.
How do we know if we are moving the needle? How is enablement making people productive? Look at the sales process and where enablement can have an impact. What did the managers want to impact? Executives want to measure the time to revenue of a new hire and these were manageable metrics that create a solid overview of productivity.
1. Win Rate
The first metric that you should start analyzing is Win Rate.
Win rate is the number of deals that you win over the number of deals you close (win or lose). Basically, if you close 100 deals, how many of those 100 are now customers?
Win rate isn’t necessarily about how many new logos you sign. If you’re enabling a closing team then yes, obviously you’re looking at wins divided by close.
But the win rate is really about conversion rate.
For instance, if you’re enabling BDRs, your “win rate” might be the conversion from lead to a qualified pipeline, and you’d adjust your metrics accordingly.
Adriana recommended you start with each stage of the pipeline and analyze where you are losing. She used an example of the discovery call. Even though it is early in the process, what you do in the discovery phase will persist throughout your sales cycle. It will lead to better discovery and a better chance to achieve revenue goals. Adriana also talked about the “CSI” of wins. She starts at the wins and deconstructs how that deal became a success. Success leaves clues! Every step along the way affects the win rate so this is a great way to look at it.
Why it matters
- To sales leaders: You need fewer deals in the pipeline to reach your revenue objective
- To sales leaders: Makes your pipeline teams’ (marketing / BDRs) lives a lot easier
- To execs: Lowers your customer acquisition cost (CAC) since you need to buy fewer opportunities
- To execs: Increases total revenue achievement since your sales efficiency doesn’t change, but your reps are closing more
2. Cycle Length
Next, we dove into Cycle Length. Cycle Length is how long an opportunity takes to close from when it was created. It’s usually measured in days. Again, if you’re enabling a BDR role, this will need to tweak accordingly, e.g., how long it takes to go from lead to opportunity instead of opp to close.
If I go out and ask my VP of Sales if he wants longer or shorter cycles, I’d bet all the money in my pockets he’d say shorter.
But Adriana argued this might not be quite right. It’s not always about how long it takes, but WHY. Analyze those opportunities sitting longer than average and find out why they’re sitting there and what can be done to push them along. Sales enablement can impact the cycle length by adjusting exit criteria per stage, multithreading to win, and through teaching reps cleaner pipeline management.
Reduction in cycle length frees up staff to work other deals and opens up resources for more opportunities. Those are things every CRO is concerned about. Your impact should deliver a sense of urgency to a team in a measurable way that will help cycle length. Track the team’s specific behavior changes to tie into cycle length, such as who changed behavior and did their cycle length alter?
Remember though: when you’re looking at cycle length, think about the deals themselves. A deal might take years to close, but if it’s a large enough deal that might be ok for your organization. Conversely, if you want a faster close, then you might need to push across smaller deals. It’s about understanding the objectives of your organization, and then analyzing your metrics with an eye on the ultimate business goal.
Why it matters
- To execs: Start realizing revenue sooner
- To execs: Lower your acquisition cost, since you’re spending less time per opp and your sales teams’ time is expensive
- To execs: Increase your revenue in a set time period
- To sales leaders: See commission sooner
3. Average Deal Size
Average Deal Size is another one of the many “levers” in the sales cycle that enablers can refine. Your average deal size, sometimes called average contract value (ACV) or average sale price (ASP), is how much, on average, each closed / won deal is worth.
There are a few ways that sales enablers can help raise the ACV:
- Training reps to sell more profitable products
- Training reps to hold out for larger deals, even if it means extending the sales cycle
- Focusing on selling value instead of relying on price to move the deal over the line
- Becoming more comfortable offering and selling add-ons
In general, discovery call improvements and product-based training are going to help you with deal size.
A good starting point is to track the products reps offer and uncover the largest barriers they encounter to offering more. By focusing on this modification, you gain more opportunities to achieve revenue goals.
Why it matters
- To sales leaders: Fewer deals to get to reach the quota
- To execs: Larger companies generally offer more opportunity to expand, so they’re more profitable in the long run (better LTV: CAC ratio)
4. Number of Opportunities in Pipeline
Deals are going to fall apart for reasons you can’t control. Champions leave, businesses close, spending plans change.
That’s why having more opportunities to work, and more importantly, being able to work more opportunities effectively at once is a key metric for enablers to track.
Enablers need to help reps increase the number of irons they can have in the fire so that sellers aren’t hanging on hoping a few key deals come through.
There are a few ways that enablers can do this:
- Focus on working the right opportunities: is your sales team rapidly closing out deals, or are they wasting time on opps that won’t close?
- Time management basics: do your reps know how to use their day efficiently? This is especially important in remote selling situations.
- Is there a consistent process? Are reps spending time working out what to do in addition to actually executing?
Making reps more efficient and capable of handling more opportunities at a time also works as a hedge when some of those deals inevitably fall apart or push, in turn driving a predictable forecast + revenue.
Why it matters
- To sales leaders: less risk in your forecast since you can spread it across more opps
- To execs: Reduces your CAC / COGS because you generate more revenue per rep
5. Time to Consistent Quota
Time to consistent quota is an onboarding metric. It usually means time to the first two consecutive periods of quota achievement. However, there are tons of “time to first” metrics that can be used to judge onboarding effectiveness – first deal and second deal are common within many organizations.
Giving this metric to the sales managers is crucial. It tells them how long it’s going to take before they can start to rely on their new hires for revenue. It’s also important to remember every new hire is costing the company money so any solution that gets them ramped up faster is key to generating more profit. That is, when you hire a rep, you’re making a bet. You’re betting that you’ll lose money in the short term (in salary, cost, etc… when they’re not closing) on the assumption you’ll make that cash back in spades when they start hitting quota.
Whatever you can do to reduce how long it takes them to start making deposits instead of withdrawals on your company wallet is sure to be valuable to your CFO.
Why it matters
- To sales leaders: Increases revenue captured in a set time period
- To sales leaders: Managers can rely on new hires for predictable results sooner
- To execs: Faster ramp makes your money back sooner
- To execs: Make it more likely you’ll recoup your losses on a hire
Of course, your metrics will only be as good as the data you input. It’s hard to determine any type of predictable outcome when you can’t grasp the data in the present. So if you find that your data is in shambles or untrackable, go to the drawing board with the old fashioned pen and paper. Use this time to recheck your process and stages to find out where you can improve on data collection. Working with your sales ops team could also help in gathering data. Getting a handle on these numbers and utilizing the right sales enablement tools can get you started in the right direction. At the very least, it will establish a baseline and get a snapshot of where you are so you have a starting point as you launch into 2021.
If you have half an hour to watch the webinar, click here to watch the replay.