Sales Advocate Newsletter

Measuring the Telebusiness Contribution

May 2001

We've seen it too many times. Technology firms looking to trim their budgets start by downsizing or even eliminating their telesales and telemarketing departments. Six months later, the sales pipeline dries up, revenues fall dramatically short, and the company finds itself in a crisis. How does this come to pass? It usually starts with a poor understanding of the contribution made by the telebusiness teams. Too often, the executive staff makes judgments based on insufficient or inaccurate data.

In this issue of the Sales Advocate, we look at the criteria on which you should measure your telebusiness teams. Since the deliverables vary with telebusiness roles, we'll separate telemarketing from telesales. As a reminder, sales development (a.k.a., telemarketing or account development) generates and qualifies leads and then passes them to sales, while telesales reps (a.k.a., inside sales or corporate sales) close deals.

Sales Development Metrics. Sales development is a game of numbers. To be effective, your reps have got to pound the phones, as well making good use of other media. To gauge individual performance, you need to track the following essentials:

• The number of leads passed to sales
• The number of appointments set for field sales (if that's part of your model)
• The number of sales-development-generated leads that are eventually closed by sales
• The revenue generated by each rep's leads. (This is crucial to displaying the value of sales development activities.)

For obvious reasons, the metrics above are of primary concern to sales VPs and executive staff. However, the list does not end there. The following must also be tracked, as they are "indicators" of individual and departmental performance issues.

• The number of calls each rep makes
• The number of times the reps contact prospects via available media (phone, fax, email, web chats, etc.)
• The amount of time reps spend in contact with prospects (you should have an idea of how long it takes to qualify a lead or set an appointment)

Telesales Metrics. Generally, telesales is easier to track than telemarketing because these reps generate revenue. Beyond such readily apparent metrics as deals closed and revenue booked, be sure to track each rep's close rate - a good indication of the skill of the rep (assuming that the audience is defined properly). With telesales, you can trade quantity for quality. A rep who contacts only twenty prospects a day but closes half of them is far more valuable than one who calls one hundred yet closes only two.

Factor in the Intangibles. The contribution of a well-run telebusiness group goes well beyond the quantitative results detailed above. With the right systems and processes in place, your telebusiness reps should be the vanguard of bi-directional communication between your company and your customers and prospects. They should constantly provide feedback to other departments on such issues as sales/marketing messaging, product positioning, market segment viability, target audiences, quality of lead sources, etc.

The importance of keeping accurate, timely metrics for telebusiness activities cannot be overstated. Tracking these results keeps you and your management team apprised of the performance of those most responsible for interacting with prospective customers. Doing so requires consistent, reliable processes and capable SFA, CRM and lead-tracking applications - investments quickly covered by the indispensable contributions of well-managed, productive sales development and telesales teams.

You can reach Phone Works at 510.749.9073.