What B2B sales metrics and marketing metrics do you track? Even if you have a well-planned sales & marketing strategy, you really won't know whether it's working unless you track the right sales & marketing metrics. By tracking the right sales metrics, you'll see quantifiable data regarding the impact on your sales efforts. Here are seven essential B2B sales metrics that all B2B sales reps should track.
#1) Customer Acquisition Cost
As the name suggests, customer acquisition cost (CAC) is a B2B sales and marketing metric that reflects how much money your B2B company spends to acquire a buyer. Most B2B companies, of course, spend money on advertising and marketing to acquire buyers. CAC shows the average amount of money your B2B company spends to acquire a buyer. If your B2B company spends $1,000 to acquire 20 new buyers, for instance, its CAC would be $50.
#2) New vs Returning Buyers
In addition to CAC, you should track your B2B company's ratio of new versus returning buyers. Research shows that it costs up to five times more for B2B companies to sell their products or services to an existing buyer rather than a new buyer. If a buyer has purchased your B2B company's products or services in the past, there's a good chance he or she will make subsequent purchases in the future. New vs returning buyers is a B2B sales and marketing metric that shows the percentage of new buyers your B2B company acquired in a specific period relative to the percentage of returning buyers it acquired in the same period.
#3) Average Revenue Per Account
Don't forget to track your B2B company's average revenue per account (ARPA). Also known as average sales price, ARPA reflects the average amount of money each buyer spends with your B2B company during a specific period. You can track ARPA either monthly or yearly. When tracked monthly, this B2B sales metric shows how much money each buyer spends per month. When tracked yearly, it shows the average buyer's yearly expenditure with your B2B company. If you're looking to improve your B2B company's ARPA, consider utilizing upselling and cross-selling tactics.
#4) Average Lead Response Time
We can't talk about essential B2B sales and marketing metrics without mentioning average lead response time. This metric shows how long it takes a B2B sales rep, on average, to contact a lead after he or she has contacted the B2B company. A two-minute average response time, for example, suggests that it takes B2B sales an average of time minutes to contact leads after those leads have reached out to their B2B company. In B2B sales, time is of the essence. The sooner you contact leads, the greater your chance of securing them as a buyer. But remember, you do need to take a few minutes to learn about the sales lead before you make the call.
#5) Pipeline Velocity
A B2B sales metric that's often overlooked is pipeline velocity. What is pipeline velocity? It's a measurement of how long it takes buyers to move through your B2B company's sales pipeline -- hence the name "pipeline velocity." Like with many other B2B sales metrics, you want to keep this metric as low as possible. If a buyer spends too much time in your B2B company's sales pipeline, he or she may not make it all the way through. The buyer may abandon your B2B company in favor of a competitor, instead.
#6) Customer Lifetime Value
Not to be confused with ARPA, customer lifetime value (CLV) is a B2B sales and marketing metric that shows how much money a typical buyer spends over the course of his or her relationship with your B2B company. Some buyers will likely spend more than others. With CLV, you'll see how much money a typical buyer spends with your B2B company. The difference between CLV and ARPA is that the former covers the customer's entire relationship with your B2B company, whereas the latter is focused on a specific period, such as monthly or yearly.
#7) Buyer Churn Rate
Finally, buyer churn rate is an essential B2B sales and marketing metric you need to track. It's a representation of how many buyers leave your B2B company during a specified period. If your B2B company had contracts from 500 buyers at the beginning of last month but lost 100 of those contracts by the end of the month, its churn rate for that period would be 20%. You should focus on keeping as your B2B company's buyer churn rate as low as possible. The lower it is, the more repeat buyers your B2B company will have.
Finally, you can use these sales and marketing metrics for all of the sales leads, which will produce a result, and you can also measure it by marketing and sales programs. In order to understand which marketing channel is producing the best results including close rate, track your sales leads by program. Be sure to include SalesLeads in your sales channel for sales leads as it provides identified projects. These Project Reports already give you the summary of the project along with alerting you to what opportunities are within the company. This will certainly affect the customer acquisition cost, average return per account, and average lead response time. Learn more about it.
These are just a few essential B2B sales metrics you need to track. You should also track conventional B2B sales metrics, such as total monthly and yearly sales. Nonetheless, tracking CAC, new versus returning buyers, ARPA, average lead response time, pipeline velocity, CLV and buyer churn rate can help you stay on track while increasing your B2B company's level of success in the process.