Crucial Metrics You Need to Include in Your Sales Team Evaluation to Measure and Track Performance

It’s no secret that being a salesperson is stressful, especially when everything from their income to their performance reviews are tied to that one critical number: revenue. But solely evaluating salespeople by the revenue they bring in during a specific month, quarter, or even year gives you an imprecise look into their value and performance. Even worse, it’s toxic: when only individual, short-term revenue matters, you can’t create a healthy team atmosphere or focus on long-term growth.

That’s why more and more organizations are switching to sales team evaluations that look at multiple different metrics. As SurveyMonkey puts it: “If you’re trying to identify which salespeople on your team are the top performers and which ones might need to make a career change, it’s important to know how to look beyond the immediate numbers and develop a more nuanced way to evaluate sales reps’ performance.” 

If your organization is used to commission-only setups and revenue-only evaluations, it may feel like making the switch to a more holistic process will take a lot of work. But by using the right analytics and sales coaching solution that can deliver reports about the ‘why’ just as easily as the ‘what,’ you can transform your sales teams. 

So first, we’re going to examine why it’s worth making the switch to multiple sales team evaluation metrics. Then we’ll look at the top seven metrics that should form your bigger picture for individual and group performance.

Why Are Sales Team Evaluations Important?

Sales organizations rely on both individual and group evaluations to power decisions. Data-based evaluations provide clear insight into results on personal and organization-wide levels, which decision-makers need for any forward-looking policy or hiring decision. Some of the most important reasons to set aside time for evaluations include the following:

Identifying Causes of Under- and Over-Performance

Relatively simple evaluations can help your organization measure if your reps are under- or over-performing. This level of analysis is basic but important. After all, your organization needs to know if sales is underperforming so you can set the course for improvement or shrinkage. Simultaneously, you need to know about over-performance so you can take advantage of the opportunities and duplicate those winning behaviors across your team.

But the underlying ‘why’s are just as important as the phenomena themselves. Some common causes of under-performance are:

• Market forces: With all the domestic concerns about a recession, spending may be down for reasons outside of your team’s control.
• New salespeople: If your department just grew with several new hires, they might not be up to par yet. Not only is their performance likely to be lower than you expect, but your tried-and-true sales professionals may also be disrupted by training and questions.
• Customer frustration: If customers don’t like your new products or are struggling to make a product update fit into their workflows, deals might slow down, and upsells may grind to a halt. 
• Long customer acquisition timelines: Lag can grow without your team noticing it, especially if you don’t measure it. If sales processes are growing longer and longer, you’re going to see less revenue coming in.
• Poor MQL and SQL showings: Qualified leads are the bread and butter of any well-performing sales team. But if the leads aren’t appearing or your competitors are moving in, sales teams will spend more time on leads who simply don’t pan out (for a wide variety of reasons).

Over-performance can happen, too, but it’s hard to maximize the impact of that good news if you don’t know why your sales team is striking gold. Everything from an economic uptick to a single large deal can make your revenue results outperform your predictions. Getting to the bottom of it ensures you can reset your models accurately or prioritize whatever product is capturing your target market’s attention.

Finding the Habits and Behaviors That Matter Most

Conventional sales team evaluations can help you quantify sales reps based on their results, but those processes can’t communicate why success or failure is occurring. By incorporating more in-depth data collection and insights into your evaluations, you can learn more about your team’s winning behaviors. 

This includes soft skills like conversational strategies, nonverbals, and word choices that work in live sales and simulations. AI-powered tools can examine dozens of less obvious behaviors, such as outreach emails, response time speeds, and friendliness, so you have a clear breakdown of what’s working and what’s not. Once you have this information, you can set up best practices for your whole team.

Reaching Revenue Operations Goals

One of the biggest benefits of real-time big data is the ability to fine-tune predictive models and forecasts. Your sales operatives can use continuous streams of data to predict when deals will close, revenue for different quarters or months, and even what deals to prioritize as Q4 comes to a close. But you need the right sales data to power these goals as accurately as possible and ensure your strategy is the best one.

Here, group evaluations can tell your leadership teams what to do and how to ensure goals are met.

Giving Employees Goals and Incentives

Employee buy-in, not just customer success, is essential in modern businesses. Employee turnover is expensive, with some estimates putting the cost of replacing an employee at half to three-quarters of the position’s annual salary. 

By giving employees measurable and objective goals that are fairly measured and well-compensated for, your organization can retain high-performing employees. Not only is this a boon to your bottom line, but it helps keep the culture healthy and ensures you always have expert salespeople on your team, often with legacy knowledge of your products and services.

Certifications through personalized AI training programs and customized simulations that noticeably improve their skills along a clear professional track can also incentivize better performance and an ambition to learn more.

Maintaining Company Culture

Strengthening employee culture through employee retention is a great start, but it’s not enough to create a truly thriving organization. By flipping from a revenue-only evaluation model to models that focus on lifetime customer growth, training participation, and other metrics, you incentivize teamwork and healthy productivity among your team. 

If you don’t measure and reward elements that contribute to company culture, you won’t have a company culture. While it should primarily be the job of HR and leadership positions to focus on culture, everyone should contribute to it.

Reducing Wasteful Spending

A more holistic perspective of sales performance can help your organization determine what spending should stay and what spending should go. For example, you can see if MQLs that come from specific marketing campaigns have too high of a customer acquisition cost. 

You can also see if your department can support anticipated hiring goals in the next Q1 or if you need to dial back. Reliable metrics also let you know if you need to go even further and reduce the size of your sales team (as well as which low performers you may need to let go).

Related: How to Choose the Best Sales Acceleration Software for Your Team

Essential Sales Team Evaluation Metrics for Measuring and Tracking Performance

But you can’t paint this clear picture from revenue alone, whether you have team-wide revenue metrics or individual revenue metrics for each salesperson. In fact, standard metrics can’t tell you the whole story of your team’s performance, what motivates them, and what behaviors lead to success. 

That’s why software solutions that analyze the data to provide deeper analytics, like individual C-IQ scores — or communication capabilities scores — give you a more complete story by combining multiple metrics. Augment your evaluation processes by looking at these key measures:

1. Conversion Rate

This number measures how many leads become paying customers. This number is a relatively simple fraction. Calculate your conversion rate by dividing the number of paying customers acquired within a set period by the number of leads acquired. You can make this evaluation more nuanced by gauging conversion rates for different product lines, periods of time, or revenue thresholds. This number tells you both how many leads you need to reach certain revenue goals and how well different sales reps are doing to increase their conversion rate.

2. Conversational Intelligence

Conversational IQ, or C-IQ, is the measure of each rep’s ability to provide helpful and persuasive information during conversations, handle customer resistance, and give engaging responses. Through conventional measures, C-IQ is virtually impossible to measure. What word choices made the most difference? When does a conversation turn too “salesy?” Are your reps actually zeroing in on pain points leads care about? To really measure C-IQ, your team needs a well-trained AI sales coaching tool that can both assess their conversations and provide training to continually boost that score.

3. Productivity

This catch-all metric captures all of the engagement-based activities that your sales reps perform, whether they tie directly to revenue or not. This includes sales calls, emails responded to, notes made in the CRM, and other helpful activities. 

This metric matters; it tells you the story of how committed sales reps are to providing excellent customer experiences and being helpful partners to clients. When you measure just the results, you lose insight into how your sales reps act and what they spend their time on. Gaining knowledge of the top performers and their behaviors through productivity metrics can help you instill those same behaviors in lower-performing reps.

Note: you may have a sales rep with a low conversion rate and a high productivity rate, and their strategy may not pay off until a high bump in revenue next quarter. This long-term, multi-faceted perspective is precisely why looking at multiple metrics is so important.

4. Win Rate

This metric can be applied either individually or across your whole team. Your win rate is the number of closed-won deals divided by the total number of closed-won and non-closed-won deals you have over a set period of time. 

This doesn’t measure your wins against your losses; instead, it shows how much progress you’re making in your total pool of deals in the pipeline. A higher score is always better here, but focusing too much on this number discourages sales reps from trying to secure more aggressive deals.

5. Customer Acquisition Cost

CAC, or customer acquisition cost, is the amount of money your business spends on acquiring each customer. Some companies take a basic glance at these costs, only considering direct elements like marketing costs and expenses for wining and dining. Other companies consider the cost of the time sales reps spend on leads. This can be increasingly granular, but it’s important to be consistent. This metric gives you a couple of different perspectives on sales performance:

• How much do different types of customers cost to acquire? For example, high-dollar deals may cost more to secure, and that’s okay. But if one type of customer costs far more to acquire for the same revenue earnings as another, you need to determine if they’re worth it.
• Are some sales reps more expensive than others? Experienced sales reps may know exactly what tactics to use and how to proactively address concerns, drastically whittling down the CAC. This doesn’t mean other, less efficient reps are bad for business; they just have more to learn (and ultimately, they’re still winning you business).

6. Quota Fulfillment

This is the money-maker, and it can be even more valuable than revenue metrics alone. Quotas give sales rep direction, whether they’re personal goals or group-wide finish lines. If you see your reps going the extra mile to meet their quotas, that’s a good sign. Sales ops teams and sales reps who can accurately predict their abilities and set goals are also valuable because you can trust their own evaluation of their capabilities.

7. Training Participation

This ties back to great company culture. If you have reps who are underperforming but they show a high amount of productivity when it comes to training exercises and simulations, you can be optimistic. They may be new, they may know their performance is lagging, or they may be trying to master the skills they know they don’t have. 

Your team is stronger when you have an avid learner on board than if you have someone who is underperforming but doesn’t care to address it. Having a readily available AI coaching solution that can certify your sales reps and help them improve their skills in as little as five to ten minutes a session can make all the difference.

Related: Traditional Training vs. AI-Powered Sales Coaching Platforms 

Gather the Evidence for Data-Backed Evaluations and Reviews with Quantify

Gathering data and metrics for the sake of having more metrics can bog down your processes and leave your decision-makers paralyzed. But choosing metrics that give you new angles of insight into how your sales teams are performing and how they try to improve their performance is crucial for rewarding everyone fairly and for the long-term success of your business. At Quantified, we provide sales organizations with AI-powered sales coaching software that grows your sales reps’ skills and gives you clear-cut, objective data about their performance. Contact us today to learn more or to schedule a demo.