You’ve just hired your first sales rep. You’re paying them more than you’re paying yourself. On their first day, you’re on the lookout for any detail that will predict success or doom. How do they shake hands? Do they make eye contact? They took lunch for exactly 41 minutes. What were they doing on their phone? You remind yourself to take it easy, but you pray they can sell. You can’t stop it. The chatter in your head is incessant. Did I make the right choice?
Hiring your first sales rep is emotionally challenging and the first thing you need to do to ease your struggle is to establish sales metrics. It will take time to close deals, and in the meantime, you can give yourself some peace of mind by tracking the progress of new deals.
Tracking the right sales metrics isn’t hard. There are only two types of metrics to track as an early-stage startup.
- Sales activities that lead to sales
- Sales pipeline (deals multiplied by revenue)
Here is your short list of sales metrics:
- Revenue / Sales
- Discovery meetings
- Connect calls
- Prospecting Phone Calls
- Emails / LinkedIn InMails / Social Media
At the beginning, you’ll be tracking these metrics without any idea of what leads to success. Don’t worry. In a few weeks or months, you’ll start to see patterns emerge. You need to answer only one question:
How many of the activities at the bottom of the list lead to success at the top of the list?
The metrics at the bottom of the list are leading indicators. Overtime, you’ll get lots of comfort tracking these metrics as you become more confident that they lead to deals. For now, just track them religiously.
At HubSpot we had monthly quotas and so it was more important to track daily sales effort. Here is what I tracked with my teams.
- 20 calls per day
- 20 emails per day
- 4-6 connections per day (phone and email combined)
- 2 new meetings set per day
- 1.5 discovery calls per day
- 0.75 demos per day
- 3-5x pipeline
Bonus tip: Don’t focus too much on just one metric. This can create odd incentives where your rep will optimize to solve for that one metric. It’s ok to have a favorite leading indicator metric, but it has to be compared with the other metrics and lead to consistent sales. Great sales people focus their efforts on daily wins without losing sight of how they are progressing towards their targets. Leading indicators help sales reps know if they have had a good day - a day that will lead them to consistent success. But they never lose sight of their path to target and are constantly moving deals forward to ensure their success.
If you only had two metrics, I’d choose a daily effort metric like meetings set and pipeline. Over time as you track more sales processes, those two metrics should give you a quick assessment at your likelihood to meet and exceed target.