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Sales performance measurement: 4 tips for tracking your team’s success

Sales Performance Measurement
1Celebrate the positive
2Make failure a part of success
3Identify pain points
4Choose the sales KPIs that matter
Final thoughts

Measuring your sales team’s successes and failures is vital to all sales organizations. It helps you optimize individual and group performance and, ultimately, pipeline efficiency and conversion. However, while sales performance measures are essential, accurate and useful measurement isn’t easy.

You have to know which key performance indicators (KPIs) matter to you and how to track them effectively. Beyond the hard skills of tracking sales, you need the soft skills to celebrate great work, deliver negative feedback without knocking confidence and develop a culture where failure is always a step towards future success.

Here are our top four tips for measuring and optimizing your team’s performance.

1. Celebrate the positive

Whether you’re reviewing a sales rep’s individual sales productivity, or quota attainment or the overall performance of your team, seek out things to celebrate.

Offer incentives when sales goals are reached. Giving credit where it’s due is a tried-and-tested morale booster, especially when sales targets are ambitious.

Here are a few ways to celebrate the positives:

  • Post leaderboards for various goals, making sure to include more KPIs than just hitting quotas (e.g. “Top three problem solvers this week”).

  • Celebrate mini-goals along the way. For example, if you have a goal to reach 10 closed deals this week, celebrate the halfway point.

  • Discuss small wins alongside the big wins. Did an employee bring a deal back on track? Did a colleague overcome a sales objection in a creative way? Celebrate!

Your focus on the positive should extend to how you present the review process to your team. Always frame it as an exercise to find out what’s working best and why, so the rest of your team can replicate it, rather than as a way to call out underperformers or allocate blame.

Download Your Guide to Sales Performance Measurement

The must-read guide for any sales manager trying to track, forecast and minimize risk. Learn how to scale sales with data-backed decisions.

2. Make failure a part of success

No matter how much you optimize your team’s sales performance, failures are inevitable in the course of your sales activities.

A negative reaction to failure isn’t helpful and will knock the confidence of your salespeople. Instead, embrace failures and involve your team in the process of finding the lessons from past mistakes.

Here are a few ideas for ways to do this:

  • Anonymize situations when discussing errors in a group. Speak generally about something that went wrong and avoid naming specific colleagues.

  • Talk about the positives along with the negatives. What happened that went well?

  • Own up when the reason for failure was a lack of resources or another leadership factor (e.g. it was an easy mistake for an employee to make because they weren’t given the right information about the sales prospect).

These lessons should be formalized into an actionable plan and, where necessary, filtered into your processes and training materials. You can then follow up and review progress against the plan until you’re sure your measures have been effective.

This way, you’ll slowly create a “test and learn” culture where failures are discussed and profited from, rather than swept under the carpet.

3. Identify pain points

Some pain points in the sales process are more obvious than others – but it’s often the hardest-to-spot issues that have the biggest impact on sales performance.

Triggers are a great way of discovering these roadblocks. Just like you’d use CRM triggers to monitor the new leads you’re trying to sell to (e.g. changes of management, profit announcements etc.) you can create real-time triggers to flag up a multitude of concealed issues.

For example, if time spent on administration tips your trigger, it may mean some of your salespeople aren’t using your CRM to its full potential or that it isn’t fit for purpose. If a lack of qualified leads in your sales funnel tips the trigger, there may be issues in your marketing department.

This is all about testing and learning. Whenever you surface an underlying issue, remember to really dig into it and create a solution for the long term.

4. Choose the sales KPIs that matter

For some businesses, a short lead response time is vital. For others, there are far more important sales performance metrics to track. Not all KPIs matter to everyone, so work out which important sales metrics are key for your business.

Here are a few important KPIs sales managers should consider:

  • Revenue from new business vs. revenue from existing customers. It’s crucial to know whether targeting new customers is the best way to drive revenue or whether the opposite is true and customer retention is the driving force of your sales strategy. Dig into both your monthly recurring revenue (MRR) and annual recurring revenue (ARR) and see what’s working for you, then alter your revenue targets where necessary.

  • Average lifetime value of a customer. The average customer lifetime value (LTV) is an important data point when it comes to sales performance measurement. Breaking this down by demographic can help you to target demographics with a higher LTV to CAC (cost of acquiring the customer).

  • Net promoter score (NPS). The NPS is a customer satisfaction and loyalty measurement. It’s taken by asking customers how likely they are to recommend your product or service to others. You can estimate your net promoter score by surveying customers or using tools that assess sentiment online.

  • Number of deals won vs. deals lost. Conversion rates (also known as close rates) may be one of the easiest metrics to track, especially using a CRM, but keeping an eye on win rates and churn rates (plus the average deal size) is still vital when it comes to sales performance tracking.

  • Cost of selling vs. revenue earned. You need to make sure that your customer acquisition cost (i.e. the average amount you spend on staff, promotions, technology and admin to get a sale over the line) doesn’t exceed the sales revenue you get (although there are long-term strategies where this can work).

  • Market penetration. How well known are your brands and products in the market compared to your competitors? What’s the benchmark in your industry? How does your pricing compare?

  • Sales growth over time. Growth over time is always an important sales measurement, whether it refers to total revenue growth or profit margin.

You should also aim to measure sales performance by various team and individual activity metrics.

Important metrics for outreach could include:

  • Total number of sales calls made, emails sent

  • Social media/LinkedIn connections contacted

  • Amount of time your sales force is spending on each

  • Number of meetings and live demos delivered every quarter

  • Amount of upselling achieved

Once you’ve identified the key metrics in your sales process, you need a fast, simple way to track them. Unless you have time to spend puzzling over pages of sales data (and let’s face it, what sales leader does?), you need visual, customizable reports and a clear sales dashboard.

Ideally, you want the option to measure and analyze every aspect of your sales cycle, from your rate of lead generation to blockages in your sales pipeline and your amount of closed deals.

Final thoughts

Understanding where you succeed and where you fail is the key to optimization and creating better sales opportunities.

Building a greater understanding of your sales performance is well worth the time and effort. It’s the only way to identify issues, optimize on an individual and team level and consistently turn any failures into a firm foundation for future wins.

Download Your Guide to Sales Performance Measurement

The must-read guide for any sales manager trying to track, forecast and minimize risk. Learn how to scale sales with data-backed decisions.

Driving business growth