Selling is simple: a problem, solutions, a constructive exchange with your customers and prospects. When you put it like that, it almost sounds like it! In reality, this world is not so idyllic...
As in any business, you have to know what you are doing. Fortunately, companies have a secret weapon: the measurement of key performance indicators (KPIs) to redirect, if necessary, or increase the efforts of existing teams.
In this article, we'll take a look at sales operations teams, often referred to by the anglicism "Sales Operations" or "Sales Ops", and the KPIs they should be tracking to best support sales teams.
For sales operations teams in the retail sector, it's crucial to track a series of specific metrics to optimize operations and ensure business objectives are met. Here are the key metrics and key performance indicators (KPIs ) these teams should be monitoring:
Total sales volume tracking, whether by store, region or product. This includes tracking sales in units and in value (sales generated), enabling us to understand the impact of our sales initiatives.
Why is it important? Tracking sales volume provides a direct assessment of the effectiveness of sales strategies, promotional campaigns and marketing efforts. It helps to understand which tactics are working well, which is crucial for adjusting sales plans and optimizing revenues.
Analyze the market share of different products or categories in stores.
Why is it important? Market share gives an idea of the competitive position of a brand or product in relation to its competitors. Tracking this KPI helps to assess the effectiveness of marketing and sales initiatives in relation to the competition, and to identify opportunities for growth.
Evaluate the conversion rate of promotional campaigns and special offers.
Why is it important? The conversion rate measures how effectively a campaign or offer turns a prospect into a customer. In other words, this KPI helps us understand what proportion of consumers exposed to a specific promotion actually go on to make a purchase.
It is an indicator of the effectiveness of sales and marketing tactics, helping teams to optimize approaches to maximize results.
Calculate gross and net margins by product or category.
Why is it important? Analyzing product profitability helps to identify the most profitable products, the items that contribute most to your brand's profits, and therefore to adjust pricing or cost strategies.
This allows teams to focus on promoting highly profitable products, and to reconsider or adjust strategies for those that underperform.
Monitor the frequency with which inventory is sold and replaced over a given period.
Why is this important? Fast-moving stock indicates good inventory management and high demand, while stagnant stock can signal problems. Tracking this KPI is crucial to avoid overstocking or breakage (in the case of perishable products), minimize storage costs and reduce the risk of depreciation.
Here, we're talking about end customers (B2B2C).
Use satisfaction surveys, NPS (Net Promoter Score) and retention analyses to assess customer satisfaction and loyalty.
Why is this important? Customer satisfaction and loyalty are directly linked to customer retention and long-term growth. Tracking these indicators will help you understand customer expectations, improve service and increase customer lifetime value.
Measure the impact of promotional activities on sales. This includes analyzing sales before, during and after a promotion to assess its effectiveness.
Why is this important? Measuring the impact of promotions on sales helps determine which offers attract the most customers and generate the most revenue. This helps optimize promotional spending and plan more effective campaigns for the future.
Monitor delivery times from distribution centers to points of sale to ensure that products are available when customers need them.
Why is this important? Efficient delivery times ensure that products are available to customers when they need them, which is crucial for maintaining customer satisfaction and optimizing sales. What's more, fast delivery times are appreciated by stores, as they enable better stock planning and smoother inventory management. It also helps establish a relationship of trust with trading partners, assuring them that their orders will be delivered on time, according to a predictable schedule, thus reinforcing the reliability and efficiency of the supply chain.
Control costs associated with sales operations, including logistics costs, marketing expenses, and sales staff costs.
Why is this important? Controlling and optimizing operating costs helps to maintain profitability and thus improve the brand's overall margin.
Analyze the performance of different sales channels, including physical stores, e-commerce, and mobile sales. This helps optimize multi-channel sales strategies.
Why is this important? With the rise of multi-channel retailing, understanding which channel performs best allows us to allocate budgetary and human resources more strategically, and adapt strategies to maximize sales across channels.
What are the results of your sales force's prospecting? Measure your team members' engagement rates and associated conversion rates. How many contacts does each salesperson manage? Is this number increasing or decreasing?
Also, how long does it take prospects to respond to your team's solicitations? The evolution of this indicator will speak for itself...
Tracking sales targets and converting prospects into customers is a good start. Do this over time, and study variations at M+1, M+3 and A+1.
You can also look at the evolution of sales with the average selling price.
How many framework agreements have you signed? Who are your regular customers, and is their spending going up or down? Depending on the answers to these questions, you'll be able to better manage your sales forces and redirect their efforts towards what will generate the most results.
Also consider the length of the sales cycle. Time is money. A meticulous analysis will certainly reveal ways to improve things and focus on the actions that lead to the best results. It's time to get rid of time-consuming tasks, so make the most of it!
These elements will allow you to develop pipeline forecasts, which are necessary to make the right decisions today, tomorrow and beyond.
An organization's key performance indicators are as reassuring as they are frightening. When you have too many on hand, you can't see anything. Depending on your context, choose the KPIs that will provide you with the most actionable and exploitable information. Everyone has data... but you have to know how to make it easy to understand!
Once you have understood these KPIs, validated them by you and your entire team, stick to your commitments and be patient. The data will deliver their diagnosis shortly... Ready to adjust your efforts? Change is (almost) now!
