Six Best Ways to Manage Sales Pipeline Effectively
Six Best Ways to Manage Sales Pipeline Effectively
You used the best marketing campaigns, exploited the digital marketing tactics, worked day in and out and did everything to fill your data bank with leads. However, you are still unable to hit your sales targets. Your sales are stagnating somewhere. Instead of converting, your leads are slipping out through the cracks. So how do you fill these cracks?
According to a study from Hubspot, as many as 72% of the companies with less than 50 leads in their sales pipeline didn’t achieve their target. If there is one thing that differentiates a top performing sales team from the others, it is managing sales pipeline well.
A survey by Vantage Point Performance and the Sales Management Association discloses that 44% of sales executives believe that their company isn’t managing their sales pipeline effectively. Well, this is a discouraging number given the fact that it is crucial for companies to manage their sales pipeline to achieve their targets.
What is a Sales Pipeline?
A sales pipeline is a visual depiction of the sales prospects that a company has. The pipeline also shows the status of a particular prospect in the purchase process as well as the probability of closing a particular deal. All in all, sales pipeline helps a sales team in forecasting the future of a particular lead as well as how close the team is to reaching the quota.
The basic idea behind managing sales pipeline is to estimate the upcoming sales that you aim to close. In case, the estimate isn’t fulfilling enough to achieve your monthly, quarterly or yearly targets, the next thing you can do is manage your sales pipeline effectively.
Let us take an example of a sales team that targets to achieve a revenue of $200,000 in a month. Suppose they have a pipeline worth $1,000,000 while their average conversion rate is 10%. They can expect to close about $100,000 worth deals in that month. However, this is just 50% of their target. Hence, this is where the question arises –
How to Effectively Manage a Sales Pipeline to Achieve the Sales Target?
A survey of 473 CEOs executed by Gartner reveals that the top most priority of CEOs is revenue growth. And the ultimate result of managing sales pipeline effectively is nothing but revenue growth. This makes pipeline management even more important.
Let us see how you can effectively manage your sales pipeline to ensure an incessant growth of your organization.
A whopping 40% of sales people believe that the most challenging part of the sales process is prospecting. Well, if so many sales professionals believe this, then it has to be a crucial step in the sales process.
Prospecting or the process of identifying potential customers for a business is the first part of the sales process, which, if done correctly, has the potential to take the sales of the company to new heights.
While prospecting, the focus should be on the quality of leads, rather than just the quantity. Good quality leads ensure faster movement of business opportunities in the pipeline, whereas, bad ones lead to stagnation of the sales process.
To find qualified or warm leads, you should –
- Introspect your business thoroughly and analyze which companies would prove to be ideal targets for your business.
- Study about your competitor’s testimonials from their clients. Understand which companies they are targeting.
- Make use of digital marketing techniques to gauge the amount of interest that your prospects show to your online presence.
- Focus hard on getting repeat business.
2. Mark Leads with Probability
- In a layman’s language, this step simply means giving your prospects a percentage according to the probability of closing a deal. However, this will vary slightly from one industry to another, but more or less, the strategy below can work for almost all the industries.
- Mark 10-20% to the leads who have visited your website
- Give 30-40% to the leads who have filled the lead capture or enquiry form
- Assign 50-60% to those who have had a tele-conversation with you
- Allocate 60-70% to those leads who have asked for your quotes over their emails
- Mark 70-80% to the leads who have started negotiation
- And so on
The above tactic is for the leads obtained from a company’s website. For leads from other sources, the percentage and steps might vary a bit. However, the essence of the whole scheme is that all your leads should be categorized in various classes based on their progress in the sales pipeline.
This is a qualification step that helps you decide which lead falls under which category, needs how much of your time, effort and attention and requires follow-ups at what frequency. Needless to say, the higher the closure probability of a deal, the more focus it needs.
The opportunities that are nearing closure are your nurtured leads, which are almost ready to get cracked. With just a little push, you can taste the fruit of success. However, the opportunities with probability of 20-40% are the ones that will take time and even then might not get converted. Hence, it is important to concentrate on the ripened leads more than the unripened ones.
3. Keep yourself Informed
- In order to keep moving your leads forward in the pipeline, it is important to work hard on them. Try to collect as much information as possible about your leads. Does your product fulfil their requirements? Do they have enough budget for your product? Can you make your product available to them on time? Who is the decision-making authority? Do you have access to the higher authorities? How responsive is your lead towards your initiatives?
You might not be able to get straight answers to many of these questions. However, if you listen to your gut feelings and try to comprehend the intent of your leads through their body language, you would be able to understand how serious your prospect is to close the deal. This gut feeling usually comes with experience.
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4. Time Management
With too many things on your plate like administrative tasks, expense management, sales reports, etc. it becomes difficult to keep yourself updated with the sales process of every lead. This is where your time and overall management skills come into play.
To manage everything like a pro, use a sales CRM software. This software lets you –
- Store contact information of each prospect.
- Categorize different leads into different stages of the sales process.
- Manage marketing campaigns.
- Generate customized reports of the marketing campaigns as per your needs.
- Get notified about each activity happening at your leads’ end.
- Get notified about any activity due from your end.
5. Follow ups
- Did you know, 60% of customers make a deal after saying no for four times. This figure shows the importance of regular follow-ups with the prospects. Further, about 30-50% deals are closed by the sales people who respond first to the prospect once an enquiry is generated.
Thus, it is not only necessary to stay in front of your customers by following-up regularly, but also to respond first when they visit your website or fill an enquiry form. An easy way to remember following up your leads is to set reminders in your CRM so that you get notified each time a follow up is due from your end. Additionally, you can also set notifications for any activity that your leads perform on your campaigns.
Sometimes, follow-ups are frustrating for the buyer as well as the sales person. In order to serve your purpose and not disturb your buyer, you can choose to –
- Send an email thanking them to give their time and summarize your last discussion.
- Send your email campaigns on a regular basis to show your leads that you are interested to connect.
- Call to see whether your lead is still interested in the deal or else when can you connect with them again.
6. Flush the Pipeline Regularly
No matter how many efforts you put in, there will always be some good leads that become dead over time. You can identify these dead leads if they are not responsive over your initiatives or clearly deny taking the deal any further.
To manage your sales pipeline effectively, you need to stop wasting your time and efforts over these prospects and flush them out of your pipeline. However, you cannot weed out all current dead leads blindly. There can be some deals that can be kept in the future-call list. Gauge the dead and cold deals carefully, but keep your active sales pipeline clean and healthy.
If you need a one-line answer of ‘how to effectively manage your sales pipeline’, it is by examining your sales pipeline regularly. This helps you understand the progress of the deals and which ones need more attention than the others do. In turn, you boost your revenue and conversion rate of your leads.
B2B sales consulting firms are expert in helping you effectively manage your sales pipeline and keep it moving at a good pace. They have exclusive teams with professionals having extensive experience in sales pipeline management. Therefore, they can help you dig out more about your prospects and as a result progress your deals in the pipeline much faster than ever before.