The sales pipeline is a crucial part of any business, and tracking the right metrics can make all the difference in achieving your sales goals.
In this blog post, we will discuss nine important pipeline metrics that you should be tracking in 2024. By tracking these metrics, you will be able to improve your sales processes and close more deals.
What Are Sales Pipeline Metrics?
Sales pipeline metrics are the KPIs used to track the progress of potential sales from initial contact to close. By tracking these sales pipeline metrics, businesses can identify areas of improvement in their sales process and optimize their efforts for more efficient selling.
There are many different sales pipeline metrics that businesses can track, but not all of them will be equally important for every business. The sales pipeline metrics that are most important to track will depend on the specific goals and objectives of the business.
But first…
What is a Sales Pipeline?
A sales pipeline is comprised of the stages that a potential sale goes through from first contact to close. The sales pipeline typically includes the following stages:
- Lead Generation: Driving people to your website or getting them to sign up for a newsletter or other offer.
- Lead Qualification: Determining if a lead is a good fit for your product or service.
- Opportunity Creation: Turning a qualified lead into an opportunity.
- Proposal/Bid: Delivering a custom quote or proposal to the potential customer.
- Negotiation: Working out the details of the sale with the person the qualified lead.
- Sale: The lead commits to the sale and becomes a paying customer!
Sales pipelines can be linear or nonlinear, depending on the business. For example, a business that sells high-ticket items may have a longer and more complex sales pipeline than a business that sells low-priced items.
Pro Tip: Sales Pipeline vs. Sales Funnel: What's the Difference?
9 Sales Pipeline KPIs to Track in 2024
Now that we’ve answered the question, “What are sales pipeline metrics?” it’s time to take a look at some of the most important sales pipeline KPIs that businesses should track in 2024.
Below are nine of the most important sales pipeline metrics that businesses should track in order to optimize their sales process and increase their close rate.
1. On-site Engagement Activity
Are potential customers engaging with your website? Are they spending time on your site, or are they bouncing off of it quickly? On-site engagement activity is a good indicator of interest level, and it can help you to determine whether or not your lead generation efforts are effective.
To track on-site engagement activity, you can use Google Analytics to track page views and time on site. You can also use heat mapping software to see where potential customers are clicking on your website.
Tracking on-site engagement activity is a good way to gauge interest level and determine whether or not your lead generation efforts are paying off. By tracking page views and time on-site, you can get an idea of which pages are most popular with potential customers and make changes to your website accordingly.
2. Email Response Rate
Email response rate is the percentage of sales emails that receive a response from the prospect. A low email response rate could be indicative of a number of different problems, such as:
- The sales reps are not sending enough emails
- The quality of leads is poor
- The subject lines or content of the emails are not interesting or compelling
It is important to track email response rates to determine whether your sales and marketing teams are staying top of mind with their prospects. Using a CRM with reporting capabilities can help you track and measure email response rates.
3. MQLs to SQL Conversion Rate
Your marketing qualified leads (MQLs) are the leads that your marketing team has determined are ready to be handed off to sales. Your sales qualified leads (SQLs) are the leads that your sales team has determined are ready to buy. The MQL to SQL conversion rate is the percentage of MQLs that become SQLs.
This metric is important because it shows you how effective your marketing team is at generating leads that are ready to buy, as well as how effective your sales team is at closing those deals.
Suppose you have a low MQL to SQL conversion rate. In that case, it could be an indication that your marketing team is not generating quality leads, or your nurture campaigns are not engaging your leads enough to get them interested in doing business with your company.
To improve your MQL to SQL conversion rate, you can:
- Implement a lead scoring system so that only the best leads are handed off to sales
- Train your sales team on how to close deals effectively
- Monitor your MQL to SQL conversion rate regularly and make changes as needed.
4. Number of Sales Opportunities
This is the number of sales opportunities that are in your sales pipeline. You want to keep track of this number so you can see how many sales opportunities you have at any given time.
The reason why it’s important to track the number of sales opportunities is that it gives you an idea of how much work your sales team has to do. If you have a lot of sales opportunities, then your sales team is probably pretty busy.
On the other hand, if you have very few sales opportunities, then your sales team might be able to focus on fewer deals and close them faster or spend more time prospecting new leads with outbound sales strategies. Take control of sales pipeline management through automation.
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5. Conversion Rate
What's the percentage of leads that become opportunities? If your conversion rate is low, it might be an indication that you're not targeting the right companies or persona.
To improve your conversion rate, start by looking at your marketing and sales process. Are there any steps that can be improved or eliminated? For example, do you need to qualify leads before handing them off to sales?
Another way to improve your conversion rate is to focus on the quality of your leads. Make sure you're targeting the right companies and individuals with your marketing campaigns.
Using a marketing automation tool can also help you improve your conversion rate by making it easier to score and track leads. At Pulse, we offer lead scoring and tracking features that can help you close more deals.
6. Cost per Acquisition (CPA)
Cost per acquisition is a metric that measures the amount of money that your company spends to acquire new customers. This metric is important to track because it can help you determine whether your sales and marketing efforts are efficient and effective.
To calculate your company's CPA, you will need to divide your total marketing and sales expenses by the number of new customers that you acquired during the period of time that you are measuring. For example, if your company spent $100,000 on marketing and sales in January and February, and you acquired 100 new customers during that time period, your CPA would be $1000.
If you find that your CPA is high, it may be an indication that your sales and marketing efforts are not efficient or effective. You may want to consider making changes to your sales and marketing strategy in order to lower your CPA.
7. Number of Touchpoints
How many times does your sales team need to interact with a lead before they convert?
This metric will help you understand how complex your sales process is and whether or not you need to simplify it. If your team is having difficulty converting leads, this metric can help you identify where the problem lies.
Touchpoints can include things like:
- Initial contact
- First meeting
- Second meeting
- Sending proposals
- Following up
- Closing the deal
You can track this metric by having your sales team log each interaction they have with a lead in your CRM system. An average sales cycle length will give you a good idea of how many touchpoints are needed to close a deal.
8. Win Rate
Win rate is the percentage of deals won compared to the total number of deals in your sales pipeline. This metric can be a good indicator of the health of your sales pipeline and can help you identify any areas that may need improvement.
Tracking your win rate can also help you identify any patterns that may be causing you to lose deals. For example, if you notice that you always lose deals in the second stage of your sales pipeline, it could be an indication that your proposals need work.
To calculate your win rate, simply divide the number of deals won by the total number of deals in your pipeline.
Win Rate = Deals Won / Total Deals in Pipeline
For example, if you have 100 deals in your sales pipeline and you win 20 of them, your win rate would be 20%.
9. Customer Lifetime Value
Customer lifetime value (CLV) is the total amount of revenue that a customer will generate over the course of their relationship with your company. This metric is important because it can help you understand how much revenue you can expect to generate from each customer.
CLV is calculated by taking into account the following factors:
- The average purchase size
- The average number of purchases per customer
- The average length of time a customer remains a customer
To calculate CLV, you will need to gather data on your past customers. Once you have this data, you can use it to estimate the CLV of your future customers.
When you use Pulse, we remove all of the technical headaches of setting this up. Pulse makes it easy to add UTM tracking to your CRM, and our team can assist you with the process.
Of course, you'll also get access to all other great features, such as CRM, email marketing, and much more. Give Pulse a try for free today.
Conclusion
These are just a few of the sales pipeline metrics that you should be tracking in 2024. By tracking these metrics, you can gain valuable insights into your sales pipeline stages and identify any areas that need improvement.
Contact us today if you need help implementing a sales pipeline tracking system for your business. We can help you get your sales pipeline and reporting setup in Pulse, so that you can make informed decisions about your sales strategy.
