Must-Have Metrics for Outbound
Posted by Data Analytics,on February 9, 2016
Aaron Ross is the Author of the new title From Impossible To Inevitable. He’s a keynote speaker and best-selling author of Predictable Revenue, called “The Sales Bible of Silicon Valley,” based on an outbound prospecting system that’s created more than $1 billion across Salesforce.com and other companies.
If you’re whirling around in the 1.0 world, you might be a fan of measuring dials (dials per hour reps are doing). It’s a useful metric when you’re training new reps and one that measures activity. But once a rep ramps up their pipelines, are you still using dials as a way to track results? What about number of appointments? Is the appointment metric important to you? Does that really give you the data you need to more accurately forecast opportunities?
As you work through tracking metrics, you should not only track activity metrics (dials and appointments), but also opportunity metrics as well. Here are my prospecting “must-have” metrics for outbound dashboards:
Number of Outbound E-mails and Call Conversations per Month
Response Rate to Emails (Benchmark: 5-9%+)
Number of Discovery Calls or Demos per Month
Number of Qualified Opportunities Per Month
There’s a direct correlation between outbound emails, the response rate from those emails, scoping (discovery) calls you make, and the number of qualified opportunities per month. Watching these numbers, and how your team is performing relative to them, replaces the “guess-work” of how to improve with real-life actionable data.
My One Key Metric: Qualified Lead Velocity Rate (LVR)
LVR is the metric to track and score yourself to, and hold to your VP Marketing and VP Demand Generation team(s). LVR measures your growth in qualified leads & pipeline month-over-month, every month. LVR is real-time, not lagging, and it clearly predicts your future revenues and growth – and – even better, your growth trend. So if you created $1M in new qualified pipeline this month, and created $1.1M in new qualified pipeline the following month, you’re growing LVR at 10% month- over-month. So, your sales should grow 10% as well after a period of an average sales cycle length.
One great thing about LVR is that while sales can vary a lot by month and quarter, there’s no reason leads can’t grow every single month like clockwork. Every. Single. Month. Follow other core business metrics of course — just understand they aren’t as good. Sales and pipeline lag. Monthly sales growth is important, but minor variations can lead to huge forecasting / modeling variances.
For example, co-author of From Impossible To Inevitable, Jason Lemkin, and founder of EchoSign, set LVR growth targets of 10%/month once they hit $1m in ARR, and then 8%/month once they hit about $3m in ARR. The goal of 8%/month was to produce enough leads to grow the business at least 100% YoY.
And you know what? They hit the lead generation growth goals, the LVR, just about every month, and certainly every quarter, and every year. And by hook or crook, with the benefit of an every increasing quality sales team, and an even increasing quality product — the revenue followed. Not like clockwork every day. But clearly, ever quarter, and every year.
Follow other Core Business metrics of course — just understand they aren’t as good. Sales and pipeline lag. MRR growth is important but minor variations can lead to huge modeling variances.”
As long as you are using Qualified Leads (not raw or unqualified leads) with a consistent formula and a process to qualify them, you’ll See The Future. Hit your LVR goal every month and you’re golden. With practice, you’ll clearly see the future of your business 12+ months out.
Interested in learning more? Check out our webinar with Aaron Ross on how to reach sustainable growth.