When people think of Analytics they tend to think of web-based metrics that provide data on behaviour of users on a site. In fact, a company’s data gathering and trend analysis should be set up to cover the full sales cycle from prospect to customer.
Part of the challenge for companies is that this tends to be a cross-functional exercise involving several teams in the company, including marketing, sales and support. Some teams may be more focused on the requirement to have a CRM system in place, while others in the company want to focus specifically on lead generation. It is often difficult to find a solution that fits all needs and stays within budgets. Data collection often grows organically as a company grows in size, revenue and sophistication.
Regardless of how the data is collected, stored and analysis generated, there are some key points to keep in mind as to requirements to gain a holistic view of the sales cycle.
Designing the path to final conversion
It’s important to understand the buying behaviour of customers and the path normally taken to final sale. With more and more information now available to people from outside of organizations, it is often difficult to actually track this path. Setting up smaller steps for the customer to take can help guide them along the path. As well, this can ensure that they are getting the right information from reliable sources in the company.
Chart the path by setting up mini-commitments along the way, such as follows, newsletters and whitepapers. Wherever possible gather details on the customer. Depending on the path to buying, these conversion points may be automated steps from the website, or they may be interactions from the sales team. It’s important to have a method to collect and record all interactions with a customer.
Metrics can help understand trends in conversion rates. A simplistic example of a trend might be that for 100 clicks on a Facebook ad, 20 people will like the page, 5 will request a whitepaper and 1 will buy the product.
Estimating the sales cycle and forecasting revenue
Every product or service has its own unique sales cycle. Some B2C products may take hours or days, and some large B2B sales take months or years. Though this may vary from customer to customer, viewing the data does provide information on trends in a market. It may help inform a bid/no-bid decision point when information is indicating the customer is not likely to buy. It will also help with forecasting future revenues, if we are able to measure and gate a customer progress through the sales cycle.
ROI / Cost of Sales
For a specific revenue opportunity it is important to calculate a cost of sales, so that a return on investment can be weighed against the efforts taken.
A company may want to measure a specific cost of sales based on actual interactions with a customer, or use the information obtained from the trends in buying behaviour, to fix a unit cost for each phase in terms of eventual sales, or a combination. This type of information can help indicate if the efforts taken in the path to conversion are financially viable.
All of these considerations rely on the metrics and the analysis of the trends in the data to inform and help improve the overall sales process.