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Sales Pipeline Analysis: Top 5 Metrics to Track

By Salesken.ai on June, 29 2021

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Sales organizations are the heart of many businesses across the world. It is essential for such organizations to visualize their sales efforts. Without proper visibility into your sales activities, it is challenging for you to form your next sales strategies. This is exactly where the concept of “Sales Pipeline” comes into the picture.

An organization’s sales pipeline is nothing but the visual representation of each buyer’s journey. Through a sales pipeline, businesses get an idea of how close a prospect is to complete a purchase. 

The process of sales pipeline analysis is about evaluating why a particular contact succeeds or fails in the last set of activities before closing a sales deal. To perform the pipeline analysis successfully, you’ll need to analyze the key metrics with an effective CRM tool. 

This blog will discuss how you can analyze a sales pipeline and pinpoint the top five metrics to track for greater insight into your sales pipeline. 

So, let’s get started. 

How can you Analyze your Sales Pipeline? 

Your sales pipeline represents every email, meeting, or call that may take place in a sales cycle. All these are tricks to close a sales deal. The purpose of sales pipeline analysis is to get insights into your pipeline and find out which prospects are ready to complete a purchase and which prospects need more persuasion. 

In order to complete a sales pipeline analysis process efficiently and to gain a sales pipeline visualization, you need to track certain KPIs. In the next section of this article, we’ll explain these metrics in detail. 

Top 5 Metrics to add to your Sales Pipeline Report 


sales-pipeline-analysis
Are you wondering, how to evaluate the sales pipeline? Well, you need to understand the significance of each sales pipeline metric first. If you continue to track these metrics regularly, you’ll be able to generate an accurate sales pipeline report. 

Below are the metrics to start with:
 

1. New Qualified Leads per Week 

You should start your sales pipeline analysis by tracking this metric. It is impossible to close more sales deals if you don’t have qualified leads in your sales pipeline. By qualified leads, we mean the prospects who are ready to buy from you. These leads can help you achieve prompt conversion rates. 

A robust sales pipeline is filled with new leads every week. By tracking this metric regularly, you can get visibility on the following aspects: 

  • How effective are your sales activities and initiatives are to generate new leads? 
  • Is your lead volume sufficient to fulfill the revenue goals? 
  • Are your sales reps compromising on the lead quality while focusing on lead quantity? 


2. Conversion Rate per Stage 

Another metric that determines the health of your sales pipeline is the conversion rate per stage. Since the sales cycle consists of many stages, it is important to identify the conversion rate in each stage. By tracking this metric regularly, you’ll get an idea of how well your sales pipeline is doing. In fact, this metric can also notify you of any upcoming potential shifts of customers in your current sales pipeline.

In most cases, your CRM software can calculate the conversion rate per stage. However, you should also keep a closer look at the historical datasets to compare your lead conversion rates over time. An in-depth CRM pipeline report can help you with these. 


3. Sales Pipeline Velocity 

This metric shows the amount of money that’s passing through your sales pipeline every day. The value of sales pipeline velocity depends on how fast the leads are getting converted through your sales pipeline. This metric is a critical one to understand how healthy a sales pipeline is. Also, you can find those leads that are taking a long time to get converted. 

Calculating sales pipeline velocity is pretty easy. You can use the following formula: sales-pipeline-analysis
Let’s clear things out with an example. Suppose, you have 100 sales deals in your pipeline and the average size of the deals is = $2000. Say, your average sales cycle is 30 days long. 

Then your sales pipeline velocity would be = [(100*2000)/30] = $6666.67 

This means, every day, an amount worth $6666.67 passes through your sales pipeline.
Note that the higher the value of this metric, the better. 


4. Overall Pipeline Value per Stage 

Getting visibility over your overall sales pipeline value is important. This metric requires you to add up the total value of each deal in a particular stage. This overall value represents the total pipeline value of a sales pipeline. 

Evidently, the higher the value of the overall sales pipeline, the better. Don’t forget to track this metric regularly since it offers major revenue generation opportunities. But, it is always better to maintain realistic expectations. All the sales deals won’t close on the same day. 

That’s the very reason why you should calculate the value of this metric on a stage basis. You can break down your sales cycle into three stages, namely leads, opportunities, and the number of meetings booked. 

As you move ahead in your sales pipeline, you’ll see that overall sales pipeline value is declining. But that’s normal. This also indicates that your prospects are getting closer to signing a business deal. 


5. Sales Rep Pipeline Performance 

It is also very important to track how each sales rep is performing and what their individual contributions are towards your overall sales pipeline. This metric tells you exactly that. Additionally, this metric also helps you identify if your sales reps require any individual assistance or motivation. 

For example, suppose one of your sales reps is doing pretty well in terms of prospecting. This individual is bringing in new leads every day. However, a very lower percentage of these leads are getting converted. This clearly means that this particular rep requires training to improve their lead conversion skills. 

The formula to estimate your sales rep pipeline performance is the same as the conversion rate per stage metric. Only here, you need to estimate for the sales reps, individually. This metric is essential to understand how well the reps perform individually and what support they require. 

Sales Pipeline Analysis made Simpler with Salesken 

Are you looking to gain real-time visibility into your sales pipeline? Your search should end with Salesken. We’ll help you to develop detailed insights over your sales pipeline throughout. Here’s how we can help you to: 

  • Identify which leads are at which stage of your sales pipeline 
  • Evaluate the performances of your sales reps 
  • Improve your awareness with post-call analytics as we help you measure critical metrics like win rate, sales conversion, estimated deal size, sales cycle length, and so on. 
  • Reduce your sales cycle length and build a profitable sales pipeline. 

Click here to learn more

Frequently Asked Questions?

What is the sales pipeline value? 

The concept of sales pipeline value is associated with the value of sales deals. Once a lead becomes qualified for a particular sales deal, the value of that deal is known as sales pipeline valuation.

How do you forecast the sales pipeline? 

Here are some quick tips to forecast your sales pipeline: 

  • Start with tracking your current sales pipeline 
  • Monitor your historical sales data as well to capture the trend of your sales pipeline 
  • Now that you have identified the trend, use it to project your future sales pipeline 
How do you make a strong pipeline? 

Building a strong sales pipeline can get tricky. Make sure that you use the below tricks to make your sales pipeline stronger: 

  • Identify the stages of your current sales cycle 
  • Set your sales goals and estimate the gap between your current sales pipeline and your targeted sales pipeline 
  • Introduce a new sales strategy or modify your existing sales strategies 
  • Train your sales reps and improve their pitches 
  • Create a sales team of skilled and efficient reps 
How do you measure sales pipeline health?

You can measure the sales pipeline health through the following metrics: 

  • The number of sales deals you’re currently having in your pipeline 
  • The average size of the sales deals in the pipeline 
  • The average percentage of sales deals that have not been closed 
  • The average time it takes for you to close a single sales deal
How big should my sales pipeline be?

There’s no magic number as such that you can use to multiply your annual sales quota to get your ideal sales pipeline size. Nevertheless, it is suggested that a sales pipeline should be at least three times the size of the overall annual quota of your sales reps. 

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