To calculate your win rate:
One of the most highly tracked metrics among sales leaders is win rate.
According to the RAIN Group Center for Sales Research, who interviewed reps from nearly 500 companies, the average win rate across industries is 47%. It is important to calculate the win rate based on the opportunities that are sales qualified, rather than on every opportunity in your pipeline.
It goes without saying that a higher win rate equals a higher sales velocity.
Several factors can hurt your win rate, even with the best sales people on your team. Rather than looking only at the bottom of the funnel for where deals went wrong, assess your entire sales process, from beginning to end, to ensure that all the kinks in your pipe get smoothed out.
For example, does your team have trouble in early stages of the sales process or towards the end? Issues in the beginning can indicate a need for more training, a more rigorous qualification process, or be a reflection of an inexperienced salesperson.
On the other hand, issues towards the end of the sales process can be a result of ineffectively addressing objections, failing to sell the value of your product, or poor negotiation skills.
It is important to understand how far along in the sales process each opportunity goes prior to a loss.
In order to make sure your quality leads become qualified opportunities and informed buyers of your product/offering, they need to be nurtured.
When potential buyers at the top (and middle) or your funnel are educated on the ways in which your product solves a pain they may not even know they have, they are more likely to be engaged throughout the buying process, all the way down the funnel.
Sales (alongside marketing) should leverage technology to improve the lead nurture process. Selling to leads or opportunities before this will kill the deal.
Gone are the days when buyers follow the path set by the company trying to sell to them. With all the information, insights, and resources available to them, prospects are entering into conversations at various stages of engagement.
To ensure that your opportunities stay on the right track, you have to tailor your selling process to their buying path. Focusing on the opportunity and their needs will help you bring deals over the finish line.
Where in the sales process are your salespeople having trouble converting?
The CSO Insights study shows that the more a salesperson can provide insights and perspectives to prospects, leads, and opportunities, the more likely they are to gain trust and get the prospect to buy from them. In fact, companies in which a client/opportunity is super confident in your firm's ability to provide insights and perspectives have a win rate of 55.2%, compared to those who don't do that so well with a win rate of 40.2%
New business isn’t the only business. One largely untapped resource for business is established customers. Clients who already trust your product are a great source of new business, either through upsell/cross sell opportunities, or through referrals.
A company with the superior ability to accrue referrals from existing customers has a win rate of 57.4%, compared to 43.9% for companies who cannot generate referrals from existing customers.
Nurture these relationships with a customer advisory board, from which you can solicit feedback. They will continue to see you as a trusted partner, be a good source of referrals, and help you improve your win rate.
To learn more about improving your win rate and the other variables in the sales velocity equation, download our eBook.