Step away from Social Media until you Measure your Sales Velocity

0
16

Share on LinkedIn

Social Media is a great way to engage with prospective customers. No question. I’m a huge fan, and can point directly to business we have have won directly as a consequence of this blog, our DealmakerMagic channel on Youtube, and our Twitter activity. But it’s a long road, and one that is only worth traveling if the destination is clear and measurable. Unless your social media activity translates to increased sales velocity – i.e. more sales in less time – then the activity is just so much wasted effort.

I was making this point to a sales consultant recently, and she highlighted the fact that many of her clients didn’t know what their sales cycle is today, so therefore it was going to be difficult to measure any improvement. We are in the business of improving sales velocity, so this was not the first time we came across this problem. So, here’s some data that might help you determine where to start. It’s an analysis of the submissions by about 1200 companies to the Dealmaker Genius site.

The table here shows sales cycle durations for companies across a range of industries – analyzed by average deal size as well as industry type. While there are some anomalies in the data (because the limited sample set at some deal size / industry intersections) you might find that you can infer pertinent data for your business. What we have found is that the deal size, and vendor company size, are more reliable comparative indicators for sales cycle duration than industry similarity. It is no surprise that the table here shows increasing sales cycle length from smaller to larger deals, and you would expect that.

If you’re making assumptions about how long it takes to win a deal in your business, I’d suggest sanity checking your assumptions against this table. The real value though is in understanding your own sales velocity for each stage in the pipeline. This is particularly true when you are assessing the efficacy of your social media activity or indeed any marketing activity. (If you want indicative indicators of what you should expect in your business just email me ([email protected]) with a profile of your solution, buyer, average deal size, and industry, and I will get you a quick response.)

The hypothesis of social media is that prospects enter the sales cycle later in their buying cycle because having engaged in ’social’ conversation (hopefully with you) they are more informed and ready to move more quickly. You need to be able to measure if you’re having the right social engagements by determining how long it takes from that entry point to a closed deal. Otherwise, how do you know your social efforts are worthwhile?

Think also about your definition of sales cycle. Remember a losing sales cycle is usually longer than a winning sales cycle by about 50%. Poor qualification, poor access to political influence or power, happy ears, or just a (natural) resistance to accepting defeat are the usual reasons for this. But whatever the reason, it’s a very expensive and damaging endeavor. Knowing the usual velocity of winning deals helps identify losers early – and early failure is much better than later failure.

If you want to figure out your own sales process, and the expected duration through each stage of the process, you can do so at the Dealmaker Genius site for free. (You can learn more about DealmakerGenius here in a short video.) [Disclosure: Dealmaker Genius is sponsored by The TAS Group]

Social media activity can be a time-suck. Time is your most valuable commodity and unfortunately it’s not flexible; it keeps moving forward. If you can track the velocity of ’social media generated prospects’ you can figure out whether it is a smart use of that valuable resource.

Republished with author's permission from original post.

Donal Daly
Donal is Founder and CEO of The TAS Group the creators of the Dealmaker intelligent sales software application. Donal also founded Software Development Tools - acquired by Wall Data (NASDAQ: WALL), NewWorld Commerce, The Customer Respect Group and Select Strategies. Donal is author of five books including his recent #1 Amazon Bestseller Account Planning in Salesforce. He can be found on his blog at www.thetasgroup.com/donal-daly-blog or on Twitter @donaldaly

ADD YOUR COMMENT

Please use comments to add value to the discussion. Maximum one link to an educational blog post or article. We will NOT PUBLISH brief comments like "good post," comments that mainly promote links, or comments with links to companies, products, or services.

Please enter your comment!
Please enter your name here