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The use of sales metrics and analytics is a great way to benchmark, and track sales success. But can too much emphasis on sales metrics actually hurt your sales? Without proper management, understanding, and buy-in from the team, the focus can change from achieving the goal, to achieving the metrics that track the goal.
Here are five commonly used sales analytics that I find dangerous. The intent of these tactics is to increase new business, incremental sales and customer satisfaction, but the pressure to hit metrics around these goals can cause results that are counter to the original sales strategy. This is my list. What’s on yours?
- Tracking Sales “activity”. The number of cold calls, appointments, and presentations made in a given time frame generally defines sales activity. Tracking this activity is a commonly believed way to manage to success in a sales organization. Sales is a game of numbers, and by default, more client contact should result in more sales. However, quality always wins over quantity, and a salesperson will manipulate numbers and appointments to hit the metrics. Time spent fabricating activity is better spent working on proposals, researching prospects, or thinking about how to get through to a key target. What’s more valuable – a sales person that knows how to sell but doesn’t hit standard activity metrics or the one that checks all the boxes? I’ll take the former over the latter any day. (On the flip side, tracking activity can be helpful to coach a poor performing account executive, who may be failing somewhere in the sales process. Other than that I say no go.)
- Incentives for Selling a “Special Package”. We all have those sales superstars that know who to call to pitch that special offer, but many in sales just want the prize or bragging rights. So what happens? The special package gets rolled into a deal that was already in the pipeline. Yes, Johnny may have hit the metrics for selling three of those special packages, but was there a huge lift in incremental sales? No.
- Phone “Jams”. Every Tuesday from 9am-11am the team hits the phones and no one quits until they have 5 appointments/sales. Yes, your team will make the dials, but I guarantee they have already sandbagged some, if not all, appointments. All you’ve done is moved an activity from one day to another so the salesperson can say the metric was met. No growth achieved.
- Forced Pipeline/Forecasting – Your sales people should have x number of leads and x number of pipeline dollars in CRM or else (fill in negative consequence here). The result? Weak, and over valued pipeline to appease management. But hey – metrics that roll up to senior leaders looks good, right?
- NPS (Net Promoter Scores) – This one might seem a little left of center but completely relevant. There is now a cult following around NPS scores in relation to customer satisfaction. There is such an obsession around NPS; it’s turned into a gaming situation. The goal is no longer to have satisfied customers, but to have a great NPS score. In order to win the “is my score better than yours” war, companies can alter the questions to get a better result, only send to happy customers (this can be done when an employee, like an account manager, is compensated on NPS scores), as well as lobby the customer to score us high. Are we hitting the metric? Yes. Are we getting real feedback about our sales service? No.
Sales is a skill that is developed, practiced and continually fine-tuned. Metrics can help us stay on track. The key is to use the right analytics and manage to the strategy, not the measurement.
When sales managers are also judged on hitting the metrics it’s easy to look away and believe the Emperor has new clothes. But, guess what? Your team’s not hitting your goals and the Emperor is naked! (Here’s the story if you don’t know what I’m talking about) And, you are fooling yourself if you think you can metric yourself to sales success.
Are there ways around these problems? Of course. Solid sales talent, trust in your team, and strategies with well-managed KPI’s will get you to the finish.
Incorporating feedback from the field is huge. Your sales team wants to work with you on metrics that will help achieve goals, and if they are part of the conversation, the results will be that much better.
Agree? Disagree? I’d love to hear how you’ve avoided the pitfalls and if you’ve been able to make any of the tactics above truly work.
This article was written by Christine Miller of Miller Sales Consulting. With extensive experience as a highly strategic sales motivator and sales coach, Christine has excelled at building and structuring sales organizations. More sales advice can be found on her LinkedIn page, as well as Medium. Subscribe to her videos on YouTube.