Quotas failure rates are going up – and so are the quotas!
- 46% (2016 Sales Comp Survey, Alexander Group) to 67% (the Bridge Group) of inside sales reps are achieving quota.
- Despite poor quota attainment, average increase in quota was 7.5% for past two years (Sibson Consulting, 2016) and continue to increase.
- Average tenure for sales reps is 24 months and 26% of turnover is due to missed quotas (Sales Effectiveness – Sales Acceleration Survey, 2015 – 2016, DePaul University).
What does this mean for an organization with inside sales? Failure by sales leaders to set achievable quotas will result in increasing turnover and ultimate failure for the organization to meet its revenue goals. It is critical to have metrics in place to be able to set more accurate quotas. It is critical to have metrics in place to be able to evaluate which reps are succeeding and, more importantly, how they are doing it. Only then can sales managers replicate those successful sales strategies that high-performing sales reps are using to win business.
Inside sales call costs 16% of an outside sales call – leverage your inside sales teams!
- Average inside sales call costs $50 while outside sales call costs $308 (Inside Sales Statistics, 2015 AAISP Front Lines Conference). .
- 46% of high-growth tech companies are growing through inside sales vs 21% using outside sales (Harvard Business Review).
With the projected growth of inside sales teams, companies must have on-boarding, training and best business practices well-defined and implemented to increase their reps’ productivity. And with the average cost of an inside sales call representing only 16% of an outside sales call, doesn’t it make sense to equip your growing inside sales team with your best training, tools and resources? With the explosion of sales enablement and sales acceleration tools, the real challenge becomes in identifying the right tool-set for your organization and ensuring your sales team adopts and utilizes those tools.
Reps have to connect to prospects – training must be a process
- 55% of sales reps don’t have the right skills to be successful (the Brevet Group).
- Only 13% of customers believe a sales person understands their needs (the Brevet Group).
- Having a training process gives 45 – 50% higher net sales per sales rep (ValueShift, BigTinCan, Salesforce.com).
The right skills are not dependent on talent as much as having the right training processes in place and equipping the reps with the right tools to ensure they have relevant conversations with the prospects. Everyone knows that reps today must engage knowledgeably in the buyer’s journey at whatever point in their journey the buyer is in. Reps must have current information – whether it’s their company’s product details or competitors’ products. If the rep can’t respond to questions or is unable to professionally guide a buyer to the end of their journey, that buyer’s journey is not going to end with that sales rep. Train your reps – continue to provide up-to-date information – evolve your business practices based on what’s working, and make sure all of your reps have that information immediately and at their fingertips.
Explosive growth in CRM market – technology spending increasing but adoption rates decreasing
- The CRM market will be worth $37 BILLION in 2017 (Gartner)
- 49% of businesses plan to increase CRM technology-related spending (SuperOffice)
- 49 % of all CRMs fail (Forrester Research)
You may well be one of those with a CRM that reps won’t use. And despite the failure rate, the market for sales tools continues to have explosive growth. Companies are investing more and more in tools that will make their reps productive. Reps’ quotas are increasing and they will not spend more time on entering data and reporting. They want to be selling and closing deals.
Management is already allocating more of their budgets to IT spending – the challenge is to get the reps to use the tools companies are buying. The tools must be intuitive – they must do more of the work for the rep instead of making the rep do more work. The CRM tools of yesteryear – those systems of records – will be embedded in organizations for years to come – primarily because the gorillas in the CRM space are so pervasive that reps have gotten used to their labor-intensive processes. But show a rep a tool that makes his or her job easier – a tool that minimizes not increases the data-entry work, then, and only then, will you get the rep to embrace the new tools that the company is buying.
Buy the right tools (you’ve already committed to spending the money!) and then show your reps that it will help them work more effectively, help them attain quota and make more money – for them and for you! It needs to be a sales tool – not a sales hindrance!