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Sales Data Analysis Can Increase Revenue

Sales Data Analysis Can Increase Revenue

As modern as the terms "big data" or "data scientist" may appear, they're actually nothing new. Obvious exceptions being made for the massive scale of current sales performance management solutions, merchants have been collecting and using data to drive business for thousands of years.

So, the connection between collecting data and using it to improve business has been happening for a long time.

It wasn't until the late 1950s that researchers first proposed using advanced technology to collect data to improve business performance. Yet many companies were slow to adopt the use of technology to help interpret the data, and that’s true even in the 21st century. What's more, even those companies trying to use technology to drive sales performance are having problems, with one study showing fewer than 50% of businesses using data systems are doing so successfully.

Nevertheless, learning how to collect and analyze data to improve sales performance and company revenues has become a primary ingredient in successful businesses. A report from McKinsey shows companies that anchor their marketing and sales decisions in data increase the return on investment by 15% to 20%

So how can you use data to help your sales reps do a better job, sell more of your product or services and ultimately improve all aspects of your sales performance?

It wasn’t until the 1850s that researchers proposed to use tech to collect data to improve business

First, Turn the Data Magnifying Glass on Yourself

Your first task is to take your internal data and use it to determine what your customers want and need from you. Take a deep look at the history of your transaction data. It will give you insights into hidden opportunities about sales that you may have overlooked. It will also give you an idea about the products that you need to focus on if you want to grow your business.

If your company sells a suite of products and your historical transaction data shows a customer who purchased most of the suite but never bought one particular program, you should find out why. Use a structured customer interview or survey to find out why this product fails to meet the customer’s expectations.

It may simply that nobody ever asked them if they wanted the product. This could be an opportunity to make an important sale to a trusted customer. Your internal data will help you find similar opportunities. Using data to highlight these opportunities will help you create a sales plan that targets current customers and provides insights as to how you should approach potential customers.

When you’re looking at your historical transaction data you should focus on some specific variables:

  • Your customers
  • How your customers fit into various pricing segments for your products
  • Where your customers are located
  • What industries they work in
  • The number of customers you have in any vertical
  • The products or the services that you offer
  • How your sales reps have performed

There may be other variables that you’re interested in researching, depending on the kind of business you’re in and the product or service that you offer. Analyzing the data in each of these variables will help you find unique value points for every customer. It will identify opportunities for you to sell additional products to current customers. It will also allow you to build offerings customized to the individual customer or to an industry.

Your historical transaction data will also provide insights into whether you're offering the right product or service to the right person. This is, to a degree, the opposite side of the coin from using your data analysis to identify new marketing opportunities. Your data can also show you which products are working for which variable, which can help you allocate your sales reps' time more productively.

If your current sales plan calls on your sales reps to try to sell all your offerings to everybody, this could be a waste of valuable time. Use your historical transaction data to dig deep into customers' purchasing behaviors. If your data shows that customers in a particular variable are not interested in one of your products or services but are interested in others, this will help you guide your sales reps to focus on the products or services that a customer values.

There is no sense trying to sell a product that does not make your company money. Use your data to find the right product to sell to the right person.

There is no sense in selling a product that does not make your company money

Analyzing the Data Landscape

Collecting data involves more than looking at your internal data. It also involves paying attention to what is happening in the world around us.

1. Let Others Help You

It is often possible to supplement internal data that you’ve collected with data from third parties that sell information about market shifts or customer behaviors. This third-party data can help give you a more complete picture of what is happening in a particular variable or segment.

2. Be an Information Vampire

If you want to be able to spot meaningful trends ahead of time, especially trends that have a direct impact on your business or industry, you need to be an information vampire. That means you need to be consuming as much information from outside sources as you can.

It’s essential to keep up to date on industry publications. Keep an eye on popular magazines that often have hints about trends developing among various segments of the public. Attend seminars and conferences that provide insights into what is happening in your industry, new tools and coming trends. 

Read social media, as it will often provide hints about those coming trends. If you see conversations building around a topic relevant to a product or service you offer, arrange a marketing campaign to take advantage of this opportunity and advise your sales reps to focus on these products or services when talking to current or potential customers.

It is vital to read the comments users leave on your social media sites and your website. Use software to notify you when customers use certain keywords either in praise or when making a complaint. This will allow you to respond immediately to customers' concerns.

Sadly, many companies fail to capitalize on these opportunities. Most questions consumers ask on social media are ignored even though more and more customers use social media to try to tell a company about a negative experience. Worst of all, many of the consumers who fail to receive a response will go to a competitor.

Speaking of competitors, your competitors can often provide valuable data as well. It’s always a good idea to keep a watchful eye on the competition. Sometimes a competitor will spot a trend or a marketing opportunity before you do, and you don't want to be left behind.

While it may be hard to think of this as collecting data, this information will help you create a dynamic sales plan and sales compensation plan for your reps when combined with your own internal data. No business can afford to go through the day with blinders on. If you pay attention, you will find important data all around you — in your company’s internal systems as well as the world in general.

Using social media to answer your customers’ concerns and connect with them

Clear the Pipeline

Once you’ve gathered this outside data, it’s time to look at your internal data again. Data from your sales performance management (SPM) software and your customer relationship management (CRM) tools can help you better track customer touchpoints and manage your relationship with the customer.

Mining your CRM database for data insights can help you focus on what’s most important to your customers and also help your sales reps focus on these values. CRM software will give you data on important topics like:

  • How to increase your conversion rate on previously generated leads
  • Finding the right balance between current customers and new acquisitions
  • How to determine the cost of a new acquisition and how to reward your sales reps for making those acquisitions
  • How to build strong long-term relationships with your customers
  • How to build brand loyalty among your customers
  • How to focus your marketing strategies and how to build a strong sales compensation plan to take advantage of those strategies
  • Providing your sales team with the information needed to boost productivity and to more effectively connect with each current customer and potential customer
  • Helping you improve customer service, which enables you to retain more customers and build word-of-mouth referrals from these customers

It is also extremely important that this data is current. You should be constantly revisiting the data you get from your CRM tool. Relying on data that’s a year old is not going to help you much — it may even hurt you.

If you’re going to use data to track important customer touchpoints and build solid relationships, you need to clear the pipeline constantly. Take advantage of the new data from your CRM tools. When combined with relevant data from sales performance management software, you can build a dynamic and creative sales plan that both motivates your sales team and improves your relationships with your customers.

Your data needs to be current - outdated data might even hurt your business decisions

Motivate the Sales Team

You can use all the data you’ve collected from your CRM, observations of what’s happening in your industry and on social media and from your sales performance management tool, such as Performio’s sales management program, to motivate your sales team and drive sales performance.

Here are some ideas about how to use data to drive sales performance:

1. Highlight Behaviors That Drive Sales for Your Business

You can use your data to define three or four of the most important behaviors, which will help you determine how many of these behaviors your sales reps need to emulate to achieve sales goals. This means that your key performance indicators (KPIs) need to focus on factors that your salespeople can act on and control.

For instance, data can provide you with insight into how many connections each rep needs to make, how many of those connections will turn into conversations, how many of those conversations will turn to demos and how many of those demos will result in new customers. To achieve the best results in determining these insights, make sure your data is updated and clean.

2. Create Leaderboards

Sales representatives are competitive people. It is important for them to know how they’re doing and that their coworkers and the company are aware of how well they are doing. One way to do this is to use Performio’s sales performance management software, which allows your sales reps to track their performance against their quota and against coworkers in real-time via smartphone, tablet or computer.

You also want to put leaderboards up around the office to make these achievements more visible. These leader boards will help your sales team focus on the behaviors that matter the most and result in sales. When you place leaderboards in public, they create transparency and give other employees an idea of how well your sales team is performing. It provides opportunities for praise for sales reps who are doing well and allows sales managers to see who could use a little coaching to help catch up.

It also encourages collaboration between your sales reps and some friendly competition. Leader boards motivate sales reps to achieve those three to four key behaviors we mentioned above which ultimately lead to improved sales.

3. Creating Dynamic and Relevant Sales Compensation Incentives

What really motivates a sales rep is the knowledge that their employers are compensating them fairly for their efforts. The data you collect from your CRM software and your sales performance management tools, as well as the data you collect via other means, allows you to create a sales compensation plan that works for the entire organization and for each sales rep.

When you use software like Performio to create that sales compensation plan, you are motivating these key behaviors in your sales reps. Performio provides real-time data that can help your sales reps see how they are performing and understand how they are being compensated for their performance. Data will help you understand what your sales goals need to be for your business to prosper.

Identifying behaviours that drive sales as well as using leaderboards and incentives can help motivate your team

Performio Can Help You Use Your Data to Drive Your Sales Performance

Many of the ideas that we mentioned above are also ideas a sales rep can use to monitor their own performance and behavior. Whether gathering data on customer touchpoints or using social media to hunt for new trends, the data that results from these activities provides a sales rep with insights into how they can better do their jobs.

For a company, this allows them to pay for performance and motivate the sales behaviors that result in the most revenue. Performio has a suite of tools that can help your company create a sales compensation plan that motivates these behaviors in your sales reps.

If you would like to learn more about how Performio help you develop an effective and dynamic sales compensation plan that rewards your best people and saves you money each financial year, you can request a demo today.

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