Optimizing sales growth has never relied upon intuition or guesswork. Rather, data and facts rule the day when it comes to increasing sales and growing your business. However, you have to know how to analyze sales data in order to make the most informed, data-backed decisions possible.
Moreover, you need to conduct sales analyses on a regular basis. When you do, you’ll gain incredible intelligence on things like team performance and your sales strategy. When it comes to optimizing growth, sales analysis can provide an edge that you’d be foolish to dismiss.
The following article will discuss what a sales analysis is and the different kinds you can perform.
What is sales analysis?
A sales analysis is a process of examining, evaluating, understanding, and then integrating data into your company’s sales activities. Data points can cover such things as sales, transaction data, and information about customers. Put together, all this information allows decision-makers to look at sales from various angles and then determine what’s working and what isn’t.
It can also give a clear picture as to which regions and even individual salespeople are achieving goals or not.
Sales analysis benefits
There are three primary benefits to a proper sales analysis. These include:
- Understanding client/customer needs
- Sharing sales skills
- Being aware of market trends
Understanding customer needs
In many instances, sales can be weak because the company doesn’t understand the customers’ needs. You can formulate sales measures, which can help your overall performance by finding the needs of your potential customers through a sales analysis.
Sharing sales skills
In traditional sales, nothing is systematized. Instead, everyone relies on the chief salesperson to relate relevant knowledge and skills to the rest of the team. By using data-backed sales analyses, everyone can objectively see what kinds of strategies and tactics work.
Being aware of the market trend
A sales analysis can also help you to identify and flow into trends in the market. You can also identify market opportunities, which can then allow you to predict which of your products will sell better at which times.
With all of that in mind, you should know that there are actually a few different types of sales analyses you could perform. For instance, there’s market research. With this kind of sales data analysis, you can survey leads and customers in order to gain information and insights about them. Market-research surveys are often conducted by email or phone, although you can certainly do one-on-one interviews with your target market, too.
Market research can provide a wealth of information about such things as whether the people you are targeting can actually afford whatever it is you offer, whether they feel your prices are fair, whether your offerings actually meet their needs, and whether there are other areas in their lives where your offerings might help.
Market research allows you to answer these kinds of questions and more. Your sales team can then take that information and use it to tailor their selling efforts.
Another kind of sales analysis is a prescriptive analysis. With this type, you use information that’s predictive in nature to learn more about your customers. You can learn things like which deals are better left untouched and which you should pursue. Additionally, your sales team can take the information gleaned from a prescriptive analysis and use it to tailor their sales approach as with market research.
Product sales analysis
A product sales analysis is a type of analysis that you should conduct over time. By using it, you can determine whether the products you’re offering have gone past their market lifespan or whether you should keep them in your product lineup. The overall success of your products can depend on what you learn in your product sales analysis and what you then implement into your sales process.
Sales pipeline analysis
Essentially, this is an analysis of your entire sales funnel from beginning to end. By studying analytics, you can see just how many leads you’re getting, how many of them convert into customers, and how many of those stick around to become repeat customers. You can also determine who the most qualified leads are, how much money they’re likely to make your company, and more.
By performing sales data analyses, your company can jump ahead of the curve and increase its competitive advantage. You can boost sales and income and fine-tune your entire sales process by knowing precisely which metrics to pay attention to.
Remember, though, that with today’s data gathering options, there are thousands of data points. You can’t possibly sift through them all, and even if you did, many of them don’t help you make smart sales decisions.
A quick example of metrics you should pay attention to that is based on a consensus of sales experts is the following:
- Number of calls made
- Number of emails sent
- Number of leads generated
- Lead response time
- Time spent on sales
- Follow-up time
- Sales forecast accuracy
- Average deal size
- Average time to close a deal
- Sales revenue
Finally, understand that by conducting sales analyses regularly, you help create accountability within your sales team.
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