Sales Metrics That Matter

Defining the sales metrics that matter can be easy. The content on this page will help you dig into your business to manage what matters most and leads to growth.

What Are the Sale Metrics That Matter?

This is a loaded question and you will receive myriad answers depending on whom you ask.

First a quick story:

In early 2011, I joined a Private Equity owned company as VP of sales. During my first Board of Director’s meeting, one of the PE Board Members asked me: “Joel, how do you measure salespeople.”

My knee-jerk, smart-alleck thought was to say, “By height.” I let that one go, thought for a moment, and said, “By year over year sales growth in their territory.”

Then there was a pause and silence. I thought maybe he was waiting for me to say something else. I didn’t.

Our CEO quickly jumped in and listed a bunch of other things we look at, and they’re all true. But, in the end, year-over-year performance is the only metric that matters. Are. You. Growing?

After the meeting, the board member pulled aside and said, “Your answer was right.”

Is Growth the Only Sales Metric That Matters?

Yes. And no.

It’s true that growth heals many ills in any business. More specifically, not all growth is good growth. Like cancer, that’s not good growth.

For seven years now, I’ve worked for a CEO (Not the guy who jumped-in during the story) who is a “Finance Guy,”  with a CFO who is a “Finance Guy,” and an EVP of Operations who is a borderline “Finance Guy.” I’ve learned a lot from all of them, and am incredibly grateful for how they’ve helped me learn to think critically about the sales metrics that matter.

The Sales Metrics That Matter

Year-Over-Year Growth

Come on. You knew this one was coming because it does matter.

New Account Acquisition

New accounts are the lifeblood of a company. You can have growth without new accounts, but it’s damn tough.

Current Account Retention

Private Equity people call this “churn.” If you are losing accounts faster than you are bringing them in, that’s bad. Yep. Buy low and sell high, too. All good advice here on makemarketingeaasy.com

Same-Store Growth is One of The Sales Metrics That Matters

Are the customers you have growing at a rate consistent with market growth? If not, why not? What might you do to help them?

Performance of New Accounts

Are the accounts you’re bringing on producing revenue? If not, what happened? How might you help them get going? Is there something you might improve in your onboarding process to help them launch?

Pipeline Velocity is a Sales Metrics That Matters

Are you bringing new opportunities into the pipeline? Are the opportunities in the pipeline moving along towards a close? And being washed-out if they’re duds?

Sales Activity as One of The Sales Metrics that Matters

If you’ve read this far, you’ve gathered I’m surrounded by Private Equity, Finance, and Operations people. As you might expect, this is the one they all want to see. And I think it’s the one that matters least.

Let me clarify. The reason I think it matters least is not that activity doesn’t matter. Activity is the bedrock of sales performance.

But to me, it’s what leads to the other sales metrics that matter. And it's where you look last. Why? Because unless and until you are prepared to call every activity listed in the CRM and ask them, “Did Fred call you and talk about….”  it. Just. Doesn’t. Matter. 

“How do you measure Salespeople, Joel?”  

In Conclusion

Measuring the sales metrics that matter is important. And there is so much more data available than when I began 30 years ago (Yep. I walked uphill, in the snow, to school, both ways), that it can almost become a distraction.

Have I made it clear that measuring activity is dumb? If not, I think it’s dumb. There you go.

Sales metrics that matter are top that I love to discuss. There are blog posts below, and always more coming,  to help you learn more. 

And, as always, I recommend a book: “The Sales Acceleration Formula” by Mark Roberge of HubSpot fame. It’s a book filled with good ideas about how data can help you go from $0 to $100M in revenue. And who doesn’t want that?

If you’d like a free pdf that I put together about how to make your customers and prospects feel special, fill out the form below. Or, if you’d like to schedule a time to discuss something you’re working on, email me at Joel@makemarketingeasy.com.

Good luck and good marketing and selling!