Last post I discussed 5 of my 10 favorite sales metrics, as promised here are the next 5.
AE Ramp Performance – Hiring and ramping new reps may be the most important thing you do to grow sales. Adding additional high producing reps will increase sales. Inversely continually adding people who fail to ramp will impair your results. You need to track how new reps are doing compared to plan – this plan should be based on how previous successful reps have ramped. Act quickly when it becomes clear someone will not make it (it’s in both parties best interest). If new reps are pathologically ramping slower or at a lower frequency than in the past, you may have an issue with training or you aren’t being selective enough with the AE’s you hire.
Time to close – How long does it take to close a proposal once sent? This number varies significantly from company to company, you need to establish a base-line and then track your performance from there. This along with many of the other metrics listed in this post is made significantly easier by implementation of a good CRM (I will write a future post about good CRM’s for hosting companies to use)
MRR by lead source – You need to track lead generation programs based on how much MRR they produce. Many programs look good initially because they produce a lot of leads and high numbers of proposals, but unless they produce MRR, they aren’t worth continuing.
Churn by lead source – I have seen lead generation programs that produce a lot of business that quickly churns off, tracking how long this business stays is an important factor in measuring the success of a lead source. Note: This is especially important in measuring front-loaded affiliate programs and PPC.
% of revenue from new products - If you’re not innovating, you can bet your competitors are. If 95%+ of your revenue is coming from products that are > then 24 months old, you are going to have trouble attracting business at some point soon. We are in an industry that is constantly evolving; if you aren’t doing the same, extinction may be in your future.
I want to wrap up by saying numbers can easily be misinterpreted or in the words of Peter Parker’s Uncle Ben “with great power comes great responsibility”. Be critical of your data, be honest with yourself and if your metrics look good but sales aren’t increasing, find new metrics.
About Stacy Griggs
Stacy Griggs is Sr. Director of Customer Experience for Cbeyond Cloud Services , previously Stacy was the Vice President of Sales for MaximumASP which was acquired by Cbeyond in 2011. Cbeyond (NASD-CBEY) is a publicly traded provider of telecommunication and cloud services, which has been recognized by Microsoft at its 2009 Worldwide Hosting Partner of the Year and 2010 Hyper-V Cloud Provider of the Year. Prior to Cbeyond Stacy held a series of positions at Hosting.com including Chief Sales Officer, Chief Service Officer and General Manager for their flagship Delaware data center.
Stacy has led several information technology services companies over the last 15 years. He was a Managing Director for KForce a $1 Billion publicly traded professional services firm. At KForce Stacy managed 5 business units that collectively generated $18 Million in revenue and had 140 employees. Prior to KForce Stacy was a Vice President and part-owner of Diamond Technologies, an 80 employee custom software development firm. Previously Stacy held management positions at TMP Worldwide, the University of Pennsylvania, and Humana.
Through his theWHIR blog, Stacy will touch upon sales and service in the Web hosting space, web hosting events, cloud computing and industry trends.
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