Are you one of the 72% of sales managers who hold pipeline review meetings several times a month?
Well done!
But…
Are any of your sales reps one of the 63% that say their company does a bad job of managing their pipeline?
We know. It hurts to hear the truth.
Neglecting to stay on top of your pipeline and its processes is absolutely detrimental. We're talking loss of potential revenue, struggling sales reps, inaccurate quotas, and lost opportunities.
Don't worry too much – you just need some pipeline management. Sales pipeline tracking will ensure your pipeline changes with your sales reps' skills, current industry trends, and your company's needs.
It's basically keeping your pipeline sailing true and in ship shape.
Ready to boost your pipeline management skills?
Of course you are.
Sales pipeline management is the tracking and monitoring of every sales opportunity from contact to close. Observing each sale through prospecting, qualifying, and winning not just one deal, but helping sales reps achieve quota – quarter after quarter.
You've built your sales pipeline – but it needs love.
According to the Harvard Business Review: “On average, companies that reported having ineffective pipeline management had an average growth rate of 4.6; companies with effective pipeline management had an average growth rate of 5.3, a 15% increase.”
Do you know what's even better than that? Companies that nailed three specific best practices saw 28% higher revenue growth.
What are those three practices?
Every business has its own approach, but adopting these three pipeline management best practices could give you some fantastic results.
How do you implement these practices? Calm down there, cowboy! We're getting to that.
But let's start off by saying that your CRM software is a great place to check off that first point – clearly define your sales process.
We talk about that in-depth in our blog post about the CRM sales process.
Managing and monitoring how your pipeline performs throughout the quarter so you can know what is happening and why. Without pipeline performance management, you can't accurately forecast, predict revenue, or even know how your sales process works.
Understanding how your pipeline is performing is crucial for sales leaders.
This can be difficult without concrete knowledge – which is why sales pipeline tracking is a huge help here.
A lack of visibility into your process means you're in the dark and making guesses. Observing KPIs helps you maintain performance and ensures your pipeline is running smoothly and doing what it should be doing.
A healthy pipeline is a happy pipeline. And if you monitor pipeline metrics like win rate, sales cycle, number of opportunities, drop-off rates, and sales velocity, you can keep your pipeline free of clogs (dead leads) and streamlined.
To skip right into our detailed tips on metrics, scroll to 5 Sales Pipeline Management Metrics.
Your pipeline's overall performance directly affects how you and your sales reps close deals, achieve quota and make money. It's an essential part of sales, so it's no wonder that it's a key part of sales performance management.
Your sales pipeline strategy is how your company approaches its pipeline. It's pretty obvious that it's different for every organization, but how it differs is important.
A few important steps in your pipeline strategy are:
|
Step |
Importance |
|
1. Define your buyer's journey |
Your pipeline will mirror your customer's journey, so it's good to know what it is. |
|
2. Determine your sales stage advancement |
A baseline of your sales cycle is necessary to measure if everything's going as planned. |
|
3. Determine how many deals you need to hit revenue goals |
This will determine how many leads you need to generate, your ideal close rate, and your reps' quotas. |
|
4. Be flexible |
Always be ready to change and adapt your pipeline to fit new needs. |
Don't be afraid of multiple pipelines either.
Yes, we said multiple pipelines.
Depending on the product or service, you may have several different customer paths that should be taken into consideration when strategizing. You might also need different pipelines for different customers (entrepreneurs may need a different customer journey than enterprises, for example).
Don't forget to run your strategy by your team. They do this every day. They could have some powerful insights and sales pipeline management tips.
The process and main steps you have to take in order to effectively manage your pipeline. It may seem overwhelming, but it can really be condensed down into three main points:
Yes, that's simplifying it. Yes, monitoring metrics and reviewing processes could take a while. But it really boils down to a few simple steps.
And it's worth it.
Don't worry, we won't leave you twisting in the wind. Let's carry on to the juicy tips.
Your pipeline is constantly growing and changing, so observing its behavior and making changes accordingly is a must. Like raising a child.
Seriously though, set some time aside each week to glance at these metrics and ensure everything is running correctly and your pipeline is at its healthiest.
Need some advice on how to get the most accurate pipeline metrics possible? Read up on CRM tracking on our blog.
Also called pipeline coverage. It's important to keep an eye on how many opportunities are in your pipeline at a time. It gives you a good idea of your team's overall potential, which helps forecast accuracy.
It also lets you know how effective your marketing and outbound sales strategies are.
And by tracking where these opportunities are in the sales process and how long they've been lingering there, you get a good idea of the volume your team can handle.
This metric really helps you determine revenue and set sales quotas.
Deal values are generally based on the customer, how much they're willing to spend, and whether or not they're a good fit for your ideal profile.
Knowing the average amount a deal usually closes for helps highlight your most profitable deals and where they're coming from, so you can optimize your strategy and performance accordingly.
The average amount of deals won – is possibly the most important metric on this list. Big surprise, right?
Knowing if you're actually closing deals gives you critical insight as you manage your pipeline. Having a low close rate means serious action needs to be taken. It could mean sales reps need a performance boost or extra training, it could mean marketing needs a rehaul.
But on the flip side, if you are closing with regularity, remember what your team is doing right now. It's obviously working.
Combining your win rate with a number of opportunities, average deal rate, and overall sales cycle…we get sales velocity.
This tells you how fast customers are moving through the pipeline. Velocity will help identify where customers drop off, slow down, or speed up. It gives incredible insights into the health of your pipeline, so watching it carefully is an important part of the pipeline management process.
Tracking the conversion rates of leads to opportunities, opportunities to closed deals.
This helps you recognize weak and strong points within your team. Depending on the slowest conversion point, it could indicate that a sales rep needs coaching, a marketing effort needs tweaking, or an email template needs re-writing.
But this is just the start. You can track these and even more metrics with Ringy's insights and reports.
Clean up your pipeline, monitor metrics, and regular prospecting – there are a lot of great ways to keep a pipeline running at peak performance.
Here are our top 5 favorite sales pipeline management tips.
How long has it been since you've really scrubbed your pipeline clean?
What do we mean? Well, cleaning your pipeline can include:
Yes…clearing out old leads and sending break-up emails are hard. We know.
It may seem nice to see all those leads in the pipeline, but if they're not good opportunities, it's like when someone leaves the box behind after eating all the donuts. It looks promising - until you realize how empty it is.
After all, at least 50% of your prospects aren't a good fit for your product or service.
Hmm…are we hammering this home hard enough?
Metrics and KPIs really are that important, even if we sound repetitive. Set time aside each week to check on close rates, conversion rates, deal size, drop-off rates, activity levels, and your sales cycle.
94% of enterprises say that data, analytics, and metrics are essential to the growth of a business. It's only logical that hard facts from your own historical data will help you make better decisions.
And if you're already getting a headache thinking about spreadsheets – stop worrying. A good sales tracking app will help you gather all this much-needed data.
We know, we know…no one likes to. And we certainly don't want to be the mom in your life telling you to clean your room…
But neglecting to prospect is even worse than a dirty room.
Why are you doing all that hard lead generating if you aren't going to put in the time to prospect? Make yourself a regular schedule and take the time to keep the prospects coming in so you never run dry.
Maintaining a consistent prospecting routine will ensure pipeline health because you'll always have opportunities coming in as you close (or, regrettably, get drop-offs).
One of the best ways to ensure a healthy pipeline is to establish a standard follow-up process for your sales reps.
You don't want quality leads getting away just because you forgot to follow up, right?
And when creating this follow-up process, try to limit the amount of time between received and sent. Sales reps that follow up within one hour of receiving a query are 7x as likely to qualify that lead. Yet the average time for a business to respond to a prospect is 42 hours.
Outline your follow-up process with timing, contact method, and formality based on each pipeline you manage.
Yup, we want you to be “that guy”.
“Is it really that important?” we hear you ask, “Asking for referrals is awkward…”
Is it important? We'll answer with a table of hard-hitting statistics:
|
Fact |
Stat |
|
When referred by other customers, people have a retention rate increase of: |
37% |
|
B2B companies with referrals experience a conversion rate increase of: |
70% |
|
A referred customer's lifetime value (LTV) is increased by: |
16% |
|
Amount of top performers that ask for referrals: |
Put on the brakes – you saw that last stat, right?
If retention rates are already increased by 37%, imagine if more than 47% of your top performers started asking for referrals. What if 60% of them did it? What if all of them did it?
You could be looking at a faster, smoother sales cycle and overall more sales opportunities in your pipeline. Healthy, hot opportunities that are ready to buy.
We told you that you didn't need those old, cold leads.
Alright, so we covered the hot tips – let's get to the best practices for optimal pipeline management skills.
The top things you can do to keep a high-performing, functional sales pipeline.
That's right. You're reading this, asking “why is pipeline management important?” and brushing up on effective pipeline management skills – but we want more out of you.
We want you to take all this advice and incorporate it into a regular schedule. Make it a part of your usual process. You don't have to do all of this every time you check on your pipeline – in fact, it could make it easier on you to space it out.
Here's an example:
Making pipeline maintenance a normal part of work will make it second nature – and it will create a stellar pipeline, too.
How you manage your pipeline (and how frequently) can be laid out in your sales plan.
A huge part of pipeline management is observing it to discover great reps, awesome techniques, and which teams are killing it.
This can clue you into a lot:
Knowing the sales reps and strategies that work the best is essentially laying out your business' top resources and tools. And everyone lists out their most powerful resources, don't they?
The opposite of the last point. Your pipeline will operate more efficiently if you discover poor performers, stale techniques, and large skill gaps.
Don't worry – this is normal. It will just educate you on what techniques need to be updated or replaced and which employees need more attention, training, and coaching.
This is basically patching up your pipeline so there aren't “weak spots”.
Imagine a team that's nothing but top performers and amazing strategies. That will make for an outstanding pipeline.
Your team should have a standardized sales process. Plain and simple.
A defined process will help streamline your sales cycle, give new hires a solid footing, and give sales managers huge insights into actions, activities, and their impact.
This allows you to monitor specific metrics and consistently improve on said sales tactics. It also will give you:
And a clearly defined, standardized sales process that can increase revenue by up to 18%.
This doesn't mean you only have to have one standard sales process – you can have more depending on your unique pipelines, target customers, and products.
After you clean out leads that aren't going anywhere, you can narrow it down further. There are going to be some leads that still are worth keeping in the pipeline – but that doesn't mean you have to put your all into them.
Some leads are just more qualified than others. It could be that they're higher value, it could be that they're a better fit for your customer profile.
Encouraging your team to prioritize high-quality leads will make for shorter sales cycles, increased quota attainment, and more revenue.
Let's bring it all together. One of the absolute top pipeline management best practices is frequently reviewing your processes and making changes.
Monitoring metrics and making a sales pipeline report are two great ways to gain insights into adjustable processes. Learning things like cold calls made, emails sent, leads generated, inbound calls received, and emails opened gives you actionable knowledge you can use in your sales plan and sales training.
Didn't your driving instructor tell you to “make small corrections – don't swerve”?
Ours did.
We don't expect anyone to learn solid pipeline management best practices in the 10 minutes it takes to read a blog post. Every sales leader needs solid sales pipeline management training.
And companies that train their sales managers on pipeline management have 9% better revenue growth than those that don't.
Effective pipeline management training will allow you to:
Sales managers need a smooth, repeatable process for managing their team's pipelines. They also need to know how to get the most out of an opportunity, how to spot a lead that's going nowhere, and how to get the most out of their metrics.
The two biggest skills to be taught are:
Sales coaching could include suggesting new tools, teaching phone sales techniques, meeting with reps one-on-one each week, practicing call scripts, doing a product demo together, and more.
Sales pipeline management training can take the form of ILT (instructor-led training), workshops, and education CRM classes, and resources can include handbooks, video courses, and documents.
To dive in-depth into sales training ideas and resources, read our blog post.
The term “pipeline” refers to multiple stages that progress towards a goal. Specifically in sales, “pipeline” refers to the stages a sales rep takes a customer through to convert them from a lead to a paying customer.
Your pipeline starts at “prospect” and ends at “customer”.
This is when your sales pipeline is created and managed in your CRM system. It enhances productivity, accuracy, and the managing of large numbers of leads.
A CRM will also help keep track of metrics, make pipeline reports, and provide clear visibility.
Sales pipeline management is when you monitor, organize, and track all the information in your sales pipeline. Goals, quotas, prospects, revenue, and more.
It also helps you understand how your sales processes work and how effective they are.
Now you know how crucial the pipeline management process is.
But it'll be easy if you use our tips to clear out cold leads, observe metrics, ask for more referrals, and create a formal process for follow-ups.
And don't forget some solid sales pipeline management training to educate on best practices for pipeline maintenance. Then you can establish effective management schedules, identify top performers, and spot a weak link to give them the support they need.
Managing your pipeline can be even easier if you log all the data in your CRM. If you're looking for a great one, request a demo with Ringy so you can have a reliable, accurate place to manage your pipeline.