Getting loyal customers to stick around is a real head-scratcher, especially for modern B2B Businesses. With so many data tools out there, we've got to shake things up a bit. Think of sales metrics as the secret sauce in this mix. Are you just going with your gut or intuition? That's a bit like shooting in the dark. We can't just stick to one old trick. We need a solid, data-smart plan to reel those loyal customers and keep them happy.
Why focus on sales metrics, you ask? Well, they're like our roadmap in the wild world of business. They show us the highs, the lows, and everything in between. Metrics help us see through our customers' eyes. They tell us what's hot and what's not. That way, we can make our services just right for them.
But don't just take my word for it. Mixing things up is key. We must rely on more than numbers alone. Our approach is a mix of both data and creativity, and it has been proven time and time again to convert yearly. It's like baking a cake. You need the right mix of ingredients for that perfect taste. Our sales team needs to be data wizards, sure. But they must also know how to use those numbers to make real connections.
This is to help the marketing team to weave those numbers into stories that make our customers sit up and listen. Plus, whatever we're selling, it's got to be top-notch. We must keep tweaking and improving, always staying ahead of the game.
While we need those numbers to guide us, combining data, creativity, and good old-fashioned innovation wins the race. In this blog, I'll let you into our strategy to help you make things happen for your business, with the end in mind of helping you create long-lasting customers.
Choose Sales Metrics Aligned To Your Goal
An ocean of metrics in the bustling sales arena surrounds us. That's why I've always told my client to zoom in and out when thinking of their strategies because they are trapped in the paradox of choice. Metrics are everywhere.
Think about it: your CRM alone is a treasure trove, and once you start syncing it with data from other platforms, the numbers keep multiplying. For example, you have data of traffic on Facebook, LinkedIn, Pinterest, and YouTube plus your data in Streak (a platform I use for CRM), which can be hard to track and take note we haven't added your comments, feedback, video views, and SEO as part of the metrics to track. But the fun part in all of this is that you don't need every data at your disposal to scale.
To achieve this, you need to review your KPIs and sales metrics and ensure they align with your goal. If you need help in creating strategic goals that will help you achieve your first $1M Sales, go check my Million Dollar Business Plan here.
KPI vs. Sales Metric
In your efforts to increase sales, there are two terms you need to be familiarized with as they often take center stage: KPIs (Key Performance Indicators) and Sales Metrics. Though they might seem similar, they are not the same. I can still recall when a consulting client asked me, "Martyna, I think KPI and Sales Metrics are the same."
To explain it in simplest terms, KPIs are the big-picture indicators, the guiding stars of a business. They're the crucial signposts that align with your company's core objectives and goals. Think of KPIs as the compass that keeps your business on its intended course. They could be anything from overall revenue growth and market share expansion to customer satisfaction levels. KPIs are not just numbers; they reflect your business's strategic performance and health.
On the other hand, Sales Metrics are more specific and focused on the nitty-gritty details of the sales process. These are the daily bread and butter of your sales team, offering insights into the effectiveness of sales activities. Sales Metrics can include the number of new leads, conversion rates, average deal size, and sales cycle length. They are the tactical tools that help sales teams track their progress, hone their strategies, and identify areas for improvement.
While KPIs set the direction, Sales Metrics are the steps taken towards that destination. Both are crucial, but they serve different purposes. KPIs give you the 'why' behind your business strategies, while Sales Metrics provide the 'how' of your day-to-day operations. In essence, KPIs are your strategic signposts, and Sales Metrics are your operational roadmaps. Understanding and utilizing both effectively can be the key to unlocking business growth and success.
Listen To Your Market
Tracking key performance indicators (KPI) is critical to winning the yearly competition. But I must remind you that your KPIs should align with your soul because you're the soul of your business. Besides, working on things you love will give you so much joy to work on them.
A good example of this is your lead generation process. Let's take your Instagram account as a case study. You'd want to track profile visits, content traffic, tapped website links, and content saved to assess the impact of your efforts.
You need to listen to what the market says about your offer to have the most impactful move. A key component in high-value content is to listen and listen to your market. By the way, I’m using 21 different software's to listen to what my market says and help me optimize my business.
Crucial Questions To Ask In Your Sales Cycle
Each type of offer you have at your disposal has a different sales cycle. For instance, you have different sales cycles in your 1-on-1 Coaching and Consulting Calls and Courses. To identify the ideal product you want to spend your resources on, here are some questions you need to reflect:
How long is our sales cycle on average?
What steps do customers typically go through before making a purchase?
What factors influence their decision-making process?
How are we generating leads?
What is our conversion rate at each stage of the sales cycle?
What feedback do we receive from customers during or after the sales process?
How does customer satisfaction impact repeat business or referrals?
How does our sales cycle compare to our competitors?
Using these questions will give you insight but if you need a more structured approach you may join my Facebook group.
Crucial B2B Metrics You Need To Measure
Since we've discussed the difference between KPI, Sales Metrics, and Sales Cycles, let's discuss B2B metrics you need to measure.
1) Conversion rate
Conversion rate is the overall measure of how successful your campaign is. These rates indicate the percentage of users who have successfully completed a desired action, such as commenting, following, or subscribing to a newsletter or YouTube.
By calculating this metric, you better understand how many people out of your total audience size are actually converting and becoming customers. Knowing the conversion rate percentage will help you make a better business decision to continue a certain campaign or keep running the ads you've run.
In short, it gives you a better strategy.
This is how you can compute it. For example, if you have 1000 email subscribers and 30 purchase your course, the conversion rate is 3%.
2) Churn Rate
A good rule of thumb to remember is to memorize this business statement, "It's cheaper to retain clients than to acquire a new one." Yes, this explains the entire churn rate.
If you're experiencing a high churn rate, you're losing customers. This means it's time to adjust the whole strategy.
In our coaching industry, a high churn rate can indicate dissatisfaction with the services, ineffective coaching methods, or issues with client engagement. Conversely, a low churn rate suggests strong client relationships and effective coaching practices.
The formula in getting the churn rate:
Customer churn rate = (Lost Customers ÷ Total Customers at the Start of Time Period) x 100
3) Customer Lifetime Value
All customers have value. Do you agree? But all of these customers need to be quantified on how much value they bring to the overall business throughout their engagement. Knowing this will help you improve the health of your business. And this is what we mean by customer lifetime value.
For example, if you have a 1-on-1 coaching program, you should look at the number of booked sessions per year and the revenue you get per session.
Formula in getting the CLV:
Customer Lifetime Value = Customer Value x Average Customer Lifespan
Remember, your CLV rate is the metric to know if you're giving a valuable service and if your clients are satisfied with their entire experience once they enter your funnel.
4) Client Acquisition Cost (CAC)
In our industry, every relationship counts because it has a huge potential to become a client, especially in organic marketing, where every genuine relationship can increase the chance of closed sales.
As we all know, even if it's organic marketing, we are spending monetary and non-monetary resources. So we should focus on the areas where we can increase our chances of acquiring new customers.
Knowing the total cost to acquire a new customer is what we call Client Acquisition Costs (CAC). It reflects how efficient we are in turning potential clients into paying clients.
Formula to get CAC:
Customer Acquisition Cost = Cost of Sales and Marketing divided by the Number of New Customers Acquired
By using CAC, you can quickly pinpoint the marketing channels you need to discard and focus on the ones bringing new customers.
Knowing these formulas and framework is just one piece of the puzzle. Book a call on the link below if you need help translating the data and creating strategy.
Know Your Numbers, Control Your Business
At the end of the day, if you want to scale your business fully, you need to know your numbers. Take your time with the data you have, but make an informed decision based on KPIs and Sales Metrics you have placed in your business.
Knowing your numbers helps you control your budget, campaigns, marketing activities, pricing strategies, and sales.
Sell more,
Martyna Boss