Outbound prospecting is tricky – prospecting team managers need their teams to diligently work the phones and bring in as many leads that can be converted into opportunities as possible. However, improving prospecting results is not a function of merely making as many calls as possible. Is there a more efficient way to improve prospecting results?
It’s about the effectiveness of prospecting activities. Start by measuring connect rates – the number of times your reps actually get through and talk to a prospect on the phone – to take a big step toward achieving such prospecting efficiency. With options for capturing different task types – left voicemail, sent email, actually spoke to prospect – in Salesforce, managers can actively track connects. Yet, with so many different metrics available, it can be challenging to discern the right activity and sales performance metrics to focus on. Most critically, sales managers need to understand the differences between activity ratios and conversion ratios.
At the most basic, tactical level, sales reps are measured on how effective they are in getting people to talk to them on the phone and eventually into the sales pipeline. Data-driven sales managers should determine what kind of revenue numbers they need to hit downstream and consider their historical conversion ratios in order to produce accurate dials goals for their sales reps.
Say, for instance, that the sales team has been given a revenue target of $1 million for the month, which requires a sales pipeline worth around $3 million (based on this hypothetical company’s historical pipeline conversion rate). With an average deal size of $20,000, this means that there should be approximately 150 opportunities in the pipeline in order for the sales team to hit its goal. From there, the manager can work backwards to look at the success rates of their reps in terms of how efficient they are with their activities and how many of these activities contribute to the opportunity pipeline.
Continuing this hypothetical, assume that these reps have a Connects : Meetings Scheduled ratio of 5 : 1, where every meeting scheduled (and the prospect shows up) enters the pipeline as an opportunity. In order to schedule 150 meetings and create 150 opportunities, your reps will have to make 750 connects. With a Dials : Connects ratio of 10 : 1, your sales team will have to make approximately 7,500 dials this month. Now, depending on the size of your sales force, you now have an accurate dials goal for each rep to hit each day. Start with your revenue goal, look at your historical pipeline coverage ratio, and then look at the historical efficiency of your activities represented as an activity conversion ratio in order to provide accurate dials goals for your reps.
Some sales managers are interested in improving the efficiency of their prospecting teams’ activities. Those managers might look at dials information to determine how they can make their reps’ activities more efficient. For instance, careful study of the team’s internal sales analytics might suggest that dials made between the hours of 8-10 in the morning or 4-6 in the evening produce higher connect rates. Armed with that type of drilled-down information, sales managers can coach their reps to be more efficient with their activities.
A sales team’s conversion efficiency ratio is also a function of what type of selling process they employ, especially the kind of touch model they use. Some sales managers might ask their reps to stop dialing after the third touch. Others might want their reps to keep persisting through the sixth, or even the eighth touch. However, with each subsequent touch, the team’s overall connect rate would suffer. A six-touch model will result in a lower connect rate than a three-touch model, but might ultimately produce more overall connects. But what if the data reveals that connect rates plateau, rather than keep decreasing, after six touches? Is it worth it then for reps to keep pursuing these leads through to an ninth touch? How about an eleventh?
Look at the graph above. This report measures the number of total calls bucketed against the number of touches, with the connect rates of calls at each touch. For example, calls on the first touch produced a connect rate of 15%, while calls on the third produced a connect rate of 9% and calls on the eighth touch just below 6%. Using this information, sales managers can find the ideal equilibrium of how many touches their prospecting process should include.
Other sales managers might place a greater emphasis on increasing connects at all costs, regardless of how efficient their reps’ activities might be. If a sales team has an exceptionally high Connects : Demos rate, the sales manager will be more interested in simply getting more connects, even if that requires making an inefficiently greater number of dials. If his or her reps are able to produce a connect rate of 10% at 60 dials, but only a 7% connect rate at 100 dials, that latter figure might be more desirable, even if the next 40 calls after 60 produces only a 2.5% connect rate. That reduced efficiency is compensated by increased output and results. The key is to find this optimal marginal effectiveness with each increase in input and determining if the resulting output is worth it.
At the end of the day, it’s all about reaching actual humans, people who can make buying decisions. Sales reps are working within a fixed universe – a purchased list of ten thousand names, a finite number of target buyers, etc. What is the marginal effectiveness of each activity or different sales process as you penetrate the names in this fixed universe? Once you have that information of Names : Connects, you can overlay that around various efficiency and effectiveness activity metrics to optimize the achievement of your goals.
The short answer about how to effectively measure connect rates in Salesforce is…there is no short answer. By starting with a final revenue goal, reverse engineering the sales process and casting a wide net of middle-of-the-road activity and sales performance metrics to track, sales managers can gain information to optimize results. Does the information reveal a slightly improving marginal connect rate after six touches? Perhaps the team should strive for eight. Did research reveal that Friday produced the lowest connect rates while Wednesday produced the highest? Have your team make a hard push on dials on Wednesday and focus on lead generation on Friday. The key is to let the data guide your decisions on people output and pipeline input.
