Sales Pipeline Management 101
Do you spend the end of every month and every quarter calling as many leads as possible? Then you understand how important it is for your business to maintain a healthy sales pipeline. The good news is you can achieve a smoother flow of deals. Having efficient pipeline management is key to ensuring that every quarter is as productive as you hoped.
It is crucial to understand that sales pipeline management is not a one-time task but an ongoing strategy - a full-time job if you will. It requires attention, effort, and a lot of focus to nurture upcoming leads without risking any of your existing deals. It's not impossible, though.
In this post, your trusted experts behind the bet all-in-one CRM software will cover a few things you have to know about sales pipeline management:
What Is Exactly Sales Pipeline Management?
A sales pipeline is a representation of your sales process, from initial contact with a potential customer to the final sale. It comprises a series of stages, each representing a different step in the sale.
Sales pipeline management is the process of tracking and managing your sales pipeline. It helps you to see where your deals are in the sales process and how likely they are to end up closing.
By regularly reviewing your sales pipeline, you can identify any problems early and take steps to fix them.
Why a Sales Pipeline Is Important
The bottom line on sales pipelines actually is the bottom line: effective management of them increases revenue.
According to the Harvard Business Review, there are 3 key points when it comes to a healthy pipeline of future sales
- Having a clearly defined sales process
- Spending time on the process
- Training sales managers in pipeline strategies and techniques
Having a sales pipeline is important for other reasons, too:
More Accurate Forecasting:
Pipelines provide a look into each sales rep's activity, how close they are to making quota, and in the aggregate, how near or far the whole team is from meeting the target quota. Using that information generated by the sales team, it's easier to provide 30, 60, and 90 day (or beyond) revenue forecasting. Knowing what and when you'll be closing sales is critical to other company departments like finance, operations, and manufacturing.
Sales pipeline management is an important process, but it can be difficult to manage without the help of CRM software. CRM software provides a number of features that can help you track and manage your sales pipeline, including:
- Contact tracking: The ability to track every stage of the sales process for each contact.
- Pipeline visualization: The ability to see all of your deals in one place, and how they are progressing through the sales process.
- Reporting: The ability to generate reports on your sales pipeline, showing how close you are to meeting your targets.
- Email integration: The ability to automatically track emails as part of the sales process, and convert them into contacts or deals.
Using CRM software can make managing your sales pipeline much easier, and can help you to improve your sales results.
Targeted Resource Allocation:
By understanding where you are at each pipeline stage for each customer or opportunity, you can take steps to allocate resources to help close business. Sales managers can determine which deals are critical, and whether or not they'll need more time and oversight.
More Effective Sales Team Management:
To finish each stage of the sales process and keep the opportunity moving, there are certain actions that must be completed. By tracking key metrics, sales managers can identify issues for each reps before obstacles arise.
Increased Deal Velocity:
If a salesperson is taking too long to move an opportunity from one stage to the next, that data will be evident when you track it. As an example, let's presume each of your salespeople has a goal of $5 million in annual sales. If 50 percent of them have already reached $1 million in half a year, then it means individual performance should be assessed and improvements implemented based on what the gathered data shows.
The importance of increased deal velocity is evident when you consider the impact it has on a business' bottom line. When sales reps are taking too long to move opportunities through the pipeline, it can have a negative impact on revenue.
By tracking key metrics, sales managers can identify issues for each reps before obstacles arise. This allows them to address any problems quickly and ensure that deals are progressing at a faster pace.
Implementing strategies to increase deal velocity can have a significant impact on a business' revenue. It's essential for sales managers to be aware of what is causing delays in the sales process and take steps to fix them.
Increase Total Deal Volume, Size, and Revenue:
If you're looking to increase opportunities, as well as the average size and revenue from those opportunities, then a sales pipeline is essential. A sales pipeline will highlight when it's time to spend less energy on specific types of opportunity, so that you can focus your efforts more productively.
A well-managed sales pipeline is about continuously improving the process itself, and honing the skills of your salespeople. Everyone's aim should be to keep the pipeline moving as quickly as possible from one stage to the next - and of course, to close sales.
Best Practices To Follow for Your Sales Pipeline Management
There are a few best practices that can help you to manage your sales pipeline more effectively:
Follow Up With Your Leads
Ideally, you should aim to contact a lead within 24 hours of receiving their information. This gives you the best chance of converting them into paying customers.
There are several ways you can follow up with your leads:
- Send them an email
- Give them a call
- Connect with them on social media
- Meet with them in person
- Always reply as quickly as you can
The method you go for will largely depend on your lead's preferences and your own sales process.
Don't Let Your Pipeline Go Stale
It's essential to keep your sales pipeline up to date. Otherwise, you risk losing out on potential deals. Regularly review and update your pipeline. Set aside time weekly or monthly to track your pipeline. This will help you identify any deals at risk of falling through the cracks. Also, make sure you remove any deals that are no longer active and add new ones as they come in.
Use Automation To Your Advantage
There are some sales pipeline management tools available that can help you to automate some of the more tedious tasks, such as sending follow-up emails or reminders.
Automation is one of the most important tools a business can use to improve its sales pipeline. It can help to speed up the process by automating tasks such as follow-up emails and reminders. This allows sales reps to focus on more important tasks, such as closing deals.
Additionally, automation can help businesses to track their progress more effectively. By automating certain tasks, businesses can gather data that helps them to improve their sales process. This valuable data can be used to improve sales performance and increase revenue.
Marketing automation is essential for businesses that want to improve their sales pipeline and increase their revenue. It helps sales reps to focus on closing deals and gathering valuable data that can be used to improve sales performance.
Know Your Sales Metrics By Heart
Managing your sales pipeline more effectively requires knowing your sales metrics by heart. This means understanding your close rate and your win rate, conversion rate, and other key numbers. By understanding your sales metrics, you can identify areas of improvement and make changes to your sales process accordingly.
Sales Pipeline Stages
Sales stages have been around for a while. For example, in 1887 John H. Patterson taught his National Cash Register (NCR) sales team how to increase sales by identifying four distinct stages: approach, proposition, demonstration, and close.
Based on the company's selling process, the number of stages in a pipeline has increased from the 1960s to present day, with some variation among these five stages:
Sellers notes that today, a sales pipeline flips this process. “Stages and the pipeline should be built on the customer decision making process. Most sales efforts are too focused on the selling process and not enough on the customer's buying process," he says.
In Sellers' BuyCycle Funnel™ design, the sales funnel and the sales pipeline are aligned. Together, the funnel and the pipeline consist of eight stages. "The sales funnel and sales pipeline are inextricably linked in this concept, so that they are the same thing,” he explains.
Using a sales pipeline to convert a concept into a visual form is useful.. But how many stages should you have? Sellers advises, “Though the customer decision making process is unique for each B2B company, in over 20 years of experience with more than 75 clients, I've found that one 'standard' decision making model applies to all B2B companies. That said, the model needs to be customized for your specific set of buyers and your organization.”
“When it comes to sales funnel stages, it's important to distinguish between pre-funnel and funnel,” says Sellers.
“There are things that happen before the sale - whatever you're doing to connect with the right people at the right time, from cold calling to an automated CRM strategy - that are great to establish contact. At that point, the customer is not yet in your funnel. Quality lead generation (pre-funnel) needs to be separated from the traditional sales process. Your customers need to engage at the next level. There must be a live body with a problem and they intend to do something about it. That's where sales really begin.”
Conclusion
Sales pipeline management is crucial for any business. It allows businesses to track their sales progress, identify any bottlenecks, and take corrective action to improve their sales process. Additionally, sales pipeline management provides businesses with valuable insights into their customers' buying behavior, which can be used to get higher sales and digital marketing strategies.
Considering how vital sales pipeline management is, you'll appreciate that there's an all-in-one CRM software that makes it so much easier for your team to track all your deals and leads, add new deals and monitor their progress.
Nurturely offers you this all-in-one CRM software that will make sales pipeline management a breeze. Find out more about Nurturely can do for you!
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