When it comes to managing your Sales pipeline, you may face some issues. Your Marketing team may not be passing along enough leads to Sales or may not be passing along the right leads. Meanwhile, your Sales team may not be contacting or following up with these leads quickly enough and may not be hitting quota.
In fact, recent research surrounding pipeline management tends to be a bit disheartening. Research shows that:
- 63% of executives believe their organizations are ineffective at managing their sales pipeline, and
- Only 46% of reps feel that their pipeline is accurate
That being said, it’s clear to see that pipeline management isn’t necessarily a simple task. However, while a majority of executives were dissatisfied with their company’s pipeline management, and while a majority of reps see their pipelines as inaccurate, there are lessons we can learn from the executives and reps that don’t fall into these majorities.
Below are 6 tips that can help lead your organization to its own effective pipeline management.
Clearly Define Your Funnel and Sales Process
First and foremost, in order to manage your pipeline, you need to clearly define your Sales funnel and Sales process. Collaborate with your Marketing team to draw this process up, keeping in mind the different channels where leads come from and the processes involved in converting a visitor to a lead, to a Marketing Qualified Lead (MQL), Sales Qualified Lead (SQL), opportunity, and (finally) into a customer.
Additionally, set in stone when and how a lead gets passed from Marketing to Sales, which will ensure that you send only the most qualified leads to Sales. If you use lead scoring, at what score does a lead get passed? If you monitor lead behavior on your website, what web page shows that a lead is interested and ready to talk to Sales? (Pricing, Request a Demo, etc.)
Align Your Sales Process with the Buyer’s Journey
As you define your funnel and the processes around it with your Marketing team, you may want to consider aligning the process with the Buyer’s Journey. As much research shows, buyer behavior is changing, and buyers now have more power in the buying/selling relationship. Because of this, buyers now expect a more personalized, buyer-centric approach when talking with Sales.
When defining your pipeline, use the stages of the Buyer’s Journey (Awareness, Consideration, Decision stages), which are buyer-centric, as opposed to the Sales-centric categories of Top, Middle, and Bottom of the Funnel.
Take Time to Manage Your Pipeline
Having a clearly defined pipeline is great, but if you don’t invest the time to manage it and make sure it’s functioning properly, the efforts you put into defining your process may have been wasted. Sales Managers should be responsible for periodically checking in on the pipeline, and should start
One of the greatest characteristics of CRM and marketing automation platforms is how measurable they are. They allow your team to be extremely analytical, and to identify important trends in your data. Your conversion rates are especially important, as they indicate how many contacts move from one stage to the next. By benchmarking rates and comparing your performance, you can see where the weak points in your pipeline are.
Other metrics you can monitor include:
- Opportunity Dollar Size vs. Average Won Deal Size
- Opportunity Age vs. Win Cycle
- Win Rate
- Cost per Lead
- Cost per Opportunity
Watch for Leaks in the Pipeline
Identify where in your pipeline—at what stage in the Buyer’s Journey—there are leaks. By this, I simply mean, where are your contacts exiting your sales funnel? Use your conversion rates to pinpoint these areas and then fix them. If contacts aren’t moving from one stage to another, what can you provide them to make them take that step?
Tie All Efforts to Revenue
Lastly, by monitoring cost per lead and cost per opportunity over time, you can ensure that all your efforts (from Sales and Marketing) are being tied to revenue. Monitoring revenue allows you to use both Sales and Marketing quotas, incentivizing both teams to put their effort toward closing deals and generating revenue. You can also monitor where leads came from (social, for example), how many got nurtured into
Of course, just because all of these tips focus on improving the way you attract and nurture potential new customers, doesn’t mean that you can forget to pay attention to your current customers. After all, as just about any research will show you, retaining current customers is almost always less expensive than recruiting new ones. For this reason, you’ve got to keep your current customers in the loop and delighted—your margins will thank you.