The most effective sales teams achieve high revenue goals, plan out their work efficiently, and find enough time to optimize the existing operations. Have you ever wondered how? Because they have a flawless sales pipeline set up and its management is next to ideal.
If you are into sales, you know how essential and challenging it is to close deals of your sales quota as a team member. To plan your goals and move ahead with working on them, you must evaluate how many deals you would be able to seal and their average value - being aware of such details always act as a boon. And this is what we call a sales pipeline.
A sales pipeline allows you to track potential prospects on their way from being leads to paying customers. And how well you manage your sales pipeline can help make or break the entire sales process. A poorly managed sales pipeline leads to time wasted on low-priority deals, deals falling through the cracks, and other similar issues. On the other hand, if you thoroughly follow the most effective sales pipeline management tips, you can have an effective sales cycle that results in generating high revenue and locking more deals.
But then the question arises of how to effectively manage a sales pipeline, especially when your business is on a growth track. This blog lets you through the sales pipeline management best practices and how to implement them. Let us dive in.
What is a sales pipeline?
A sales pipeline visualizes every lead's position in the sales cycle. It allows you a look into all the stages a prospective customer has to sail through before flipping into a paying customer.
A sales pipeline lets you visualize the number of deals the sales team is expected to seal in a year, a month, or a week and how close a sales rep is to achieving the sales quote.
If your sales pipeline in the contract value is USD 100,000 and your lead-to-sale conversion rate is 10%, you should expect to close a business worth USD 10,000. If your target for sales is USD 20,000, you would need to convert double the leads. This is where you have the sales pipeline analysis help you.
Suppose you can successfully spot improvements in your sales pipeline that help you take more potential prospects from one stage to another. In that case, you can have more conversions and more revenue generation.
As per a Harvard Business Review, there is a difference of 18% in revenue growth between businesses with a defined sales process and companies without. In addition, businesses that have mastered the sales pipeline practices witnessed a 28% growth in revenue. For any business in B2B sales, featuring a healthy sales pipeline allows the following:
- Enhances sales
- Helps forecast future business results
- Helps analyze sales strategies for your company
- You can allocate and manage resources to service or close the upcoming deals.
- Let’s you know how far away you are from achieving your targets and helps you review your progress in the running financial year
Overall, a sales pipeline helps close more deals and indicates your company's future.
Tracking your sales progress using a sales pipeline allows you the following details:
- Revenue predictions
- Number of prospective customers available
- Team performance
- Different stages of the sales cycle
- The current status of every opportunity
- The churn rate of every step of the pipeline.
What is the importance of a Sales Pipeline?
A standardized and well-defined sales process helps contribute about 18% more revenue. Thus, owning a custom sales pipeline to upgrade your business is highly significant. Let us know the benefits of having a sales pipeline in the list below:
- It helps improve sales.
- You can utilize and allocate the available resources way more judiciously.
- Your team will be able to achieve better productivity.
- It helps you focus and identify more promising prospective leads.
- You can use the sales pipeline for insights to make wiser decisions for your company.
- You can constantly analyze your team's performance and review their progress.
If used efficiently, the sales pipeline can accomplish quite a much for your company. It can help you enhance conversion rates, productivity, and revenue. One of the many benefits of an effective sales pipeline is that it helps your business steer in the correct direction by offering a clear picture of how the sales process functions presently. Here are the best sales pipeline management practices to help you manage the pipeline effectively.
1. Pay attention to your sales pipeline stages.
To keep a close watch on your sales pipeline, divide it into stages that best suit your company's sales cycle. However, there is no specific blueprint of what your sales pipeline must comprise. After a detailed consultation with your sales team and considering every aspect, you should carefully define the stages of a sales pipeline. You can customize the sales pipeline by including steps, custom opportunities, and fields.
2. Remember to follow up.
With massive competition, buyers all over the world have enormous choices. Along with the wide range of options, they require help, more than ever, to make the right choice and select your service or product. Ten years back, it took the sales teams about 3.68 sales calls to seal a deal. Today, it takes over eight calls to close a deal.
The best sales reps will ensure they keep following up with the prospective leads to seal the deal. But, most typically, most sales representatives give up following the leads after two calls. Therefore, always make extra efforts to follow up constantly. Following up with leads is not an easy task. It is one of the most challenging tasks for the sales teams.
One of the most efficient ways to follow up on your leads on time is to set up a reminder that notifies you to follow up before it is too late. Another effective solution is to automate the process altogether. You can use the sales email templates that would automatically follow up at a specific period after the initial calls.
3. Offer training and documentation.
Your business flourishes if you have a sales team that understands your sales pipeline optimally uses it. Your representatives and sales manager must know how to build and use the sales pipeline optimally. Clearly define the case studies, user roles, and documentation, and train your sales team in sales pipeline management. Only if your team is well aware of how to work with and improve a sales pipeline can they work to benefit from it. Along with practical onboarding training, you should also offer training about updates time and again such that they stay updated on the newer developments.
4. Focus on the best leads
If you ever closely monitor your sales process, you will notice it takes nearly the same time to seal every deal in the pipeline. Instead, it is best to concentrate on the best leads and put in every effort. Not getting distracted by any lead that would not push the arrow for your company is essential. For instance, you can filter the leads on your sales dashboard from high to low and not by date. Thus, you would be able to select the most valuable prospective leads for your company. You can monitor the sales activities for every lead and identify the ones that most engage with your offerings. These are the leads you should concentrate more on.
5. Drop the deal leads and perform regular cleanups
While speaking of the sales pipeline, it should always be quality above quantity. Just having more lead prospects does not mean more sales. As essential as concentrating on the most promising leads, knowing when to let a lead go is equally essential. Letting go of a lead is difficult, as you must have spent months nurturing and building a solid relationship. You must make a call if the leads qualify to receive your time and efforts at some point. This would help you dedicate your time elsewhere that might carry more value.
A lead is clearly of no use when they:
- State they are uninterested.
- Cannot be contacted.
- Would not budge to move to the next step of the sales pipeline.
Learn to spot the dead leads and let them go to prioritize your high-value leads that would help close more deals.
6. Closely monitor your sales pipeline metrics.
A sales pipeline is an entity that keeps altering every time. Keeping track of numbers in association with the sales pipeline might seem a daunting task, but it is an essential task. Thus, checking the key sales metrics a sales pipeline produces is essential. Listed below are some key metrics that a sales pipeline produces. Let us have a closer look:
- Number of deals in the sales pipeline.
- Length of a sales cycle.
- Deals percentage that you can win.
- An average deal lifetime before it closes.
- Time invested in selling.
- Rate of conversion.
Ensure to keep aside time every week to evaluate the metrics regularly, and you can keep up the health of your sales pipeline. If you track your sales results, you will see what improvements can help your sales processes to flourish constantly.
A sales CRM software can help you track metrics and gain valuable insights into the sales pipeline reporting. You can have a free consultation with experts at Sales Simplify to cater to your requirements.
7. Review your sales pipeline and improve it
Sales techniques are ever-evolving; what might work today might not work tomorrow. The sales teams that make maximum revenue and close an impressive number of deals regularly review their techniques and sales pipeline to ensure that everything is finely tuned and favourably optimized. This helps them with success and maximum efficiency.
While speaking of sales, everything on the way can be improved - right from making the first pitch to follow-ups and the offers you present. You keep experimenting until you find what best works for your business.
An ideal way to approach changes is to thoroughly review the blockages and bottlenecks in your sales pipeline. Once you find the speed breakers, you work towards fixing them. From this place, one should run sales experiments and constantly improve every process step accordingly. Once you begin making positive changes one after the other, your sales pipeline becomes a revenue-generating machine.
8. Update your sales pipeline regularly
A sales pipeline is continuously modified. New leads come in, older ones move forward to different stages, and deals get finalized. If you work carelessly, your pipeline can become chaotic and disorganized. Furthermore, a chaotic sales pipeline would lead you to inefficiency and loss of sales. To escape this, you must keep your sales pipeline up-to-date on every lead's details. You can do this by regularly adding information and notes for every sales process step.
9. Keep the sales cycle brief.
B2B companies' sales cycles can be long compared to that of the sales cycles of B2C companies. 75% of B2B sales take a minimum of four months to close, with 18% consuming about twelve more months.
As per CSO insights, 27% of sales representatives believe that the lengthy sales cycle is one of the most significant barriers to sales effectiveness. The reason behind it is straightforward - the lengthier the sales process, the more the chances for the prospect to change their mind or find a better alternative service or product.
Thus it would help if you kept your sales cycle short yet crisp. If you witness more and more of your leads going cold and fail to touch your sales targets, you might have an issue with the length of the sales cycle.
Shortening the sales cycle length does not necessarily mean you bombard your clients with ten follow-ups in a single day. Instead, you should find shorter yet effective ways to get things done. This could mean shortening the days between two follow-ups or helping the leads shorten the decision-making time.
10. Create a standardized sales process
Every customer differs from others and requires a customized approach to enhance the chances of converting into a paying client. Moreover, you might witness our sales teams employing several outbound sales techniques to convert leads. They might develop their routines like sales calls, on-to-one meetings, follow-ups, live demonstrations, etc. But, if you pay attention, multiple of your target customers will have ample in common. Their underlying reasons and requirements for purchasing what you offer are all the same.
Therefore, you must use this common factor to standardize your sales process. The ideal sales units consistently follow a standard procedure to win fresh leads. One of every three sales managers ranks sales process optimization as one of the top sales management practices. Customized sales techniques add prominent overheads and are time-consuming. On the contrary, a standard sales process can be finely tuned to perfection with time and practice.
11. Provide more content to your prospects
Emails and phone calls are the heart of sales communications. However, prospective leads would need more than just calls and emails to convert. They would require more information like in-depth details to help them better understand your business and its advantages.
For every step of your sales pipeline, think carefully about what more you can provide to your prospects. Give them what interests them and help them decide about investing in your business or stepping down to the next phase of the sales pipeline. Content is even more crucial as you keep moving ahead down the sales funnel. Therefore, what type of content should you provide?
The answer lies in listening to your customers and what they say. While at sales meetings, you would get insight into the kind of content your lead fancies. For instance, they might desire to read an article on the features of your product. And all you need to do is to send across the required. If you do now have what your potential lead asks for, you need to work on building that kind of content. Pass on the details to the marketing team to develop associated content.
12. Use a CRM to manage your sales effectively.
When you have a lot of leads and the sales pipeline is full, you must ensure that you effectively manage it. If you are a small company with a tight budget, you can maintain an excel sheet to manage your monthly sales effectively. But, as your business grows, you would like to have something more effective to take care of your sales activities.
Without a CRM, you would be unable to manage the sales pipeline effectively. A CRM is an integral part of sales, and the finest performing sales units rate CRM as one of the two most essential sales tools. A CRM will help you automate multiple processes and also aid in other tasks. Some other jobs it will help you with include tracking metrics, managing multiple leads with ease, easy access to information, etc.
13. Automate processes
While it is an easy task to perform all functions by yourself with a handful of leads, it becomes difficult to manage things as your business grows and you begin dealing with a massive number of leads. This is where sales automation can be of great aid. By automating several redundant sales activities, you can save time and invest it elsewhere to take your business to heights further. Sales automation can help your team work effectively and meet targets with ease. If you are willing to adopt sales automation for your business, you might want to consider consulting a Sales Simplify expert to take your business to another level.
A sales pipeline is equivalent to the heart of your deals. This is why it should be well managed and valued. Not managing it well can result in losing new clients, which would affect your company. Over 60% of sales managers state that their company does poorly manage the sales pipeline. Your business likely needs attention too. If you came to this space with the question of how to manage your sales pipeline, you probably have a detailed answer by now. The sales pipeline management tips mentioned above will help you keep your pipeline healthy and structured. So, wait no more and apply these sales pipeline management tips to restructure your sales processes.