If you aren’t getting the leads, sales, or revenue you’re hoping for, your B2B sales funnel might be the best place to look. After all, virtually no business has perfected every step in their sales process; there’s always a “weakest” point at which prospects are most likely to jump ship.
On top of that, there are many constantly changing variables. Market trends, customer desires, and your company’s products or services (among other factors) aren’t necessarily static. Sales methods that worked three years ago may no longer apply.
Auditing your sales funnel helps you target vulnerabilities in your sales methods for improvement and remain nimble in a constantly changing business environment.
Sales Funnel vs. Sales Pipeline
Sales funnels and pipelines aren’t too different. In fact, they’re complementary.
Your sales pipeline describes each stage your prospect moves through as they progress from brand new lead to happy repeat customer.
On the other hand, your sales funnel measures the conversion rate at each sales pipeline stage. That’s why it’s called a funnel — you have a large number of leads at the top, but some of them drop off at each stage of the funnel.
With this difference in mind, let’s go over some critical metrics to analyze when auditing your sales funnel.
Areas of Your Sale Funnel to Evaluate
Lead Quantity
The first sales metric to audit would be how many leads you receive — an easy enough number to find. Lead quantity is most relevant to the top of your funnel, where you’re making that initial contact with prospects.
Consequently, this metric primarily shows you which marketing channels work best for you. For instance, if you observe that you’re receiving a large majority of leads from social media efforts, you might double down on that strategy.
Lead quantity also reflects the effectiveness of your marketing messages. If you aren’t hitting your goals each month, perhaps your marketing campaigns aren’t connecting with your target market.
Speaking of goals, lead quantity doesn’t mean much if you can’t compare the number of leads you receive between periods. Compare lead quantity against historic data to discern seasonal influences outside of your control.
When auditing your sales funnel to determine strengths and weaknesses, analyze your lead quantity to have clear answers to the following questions:
- How has my lead quantity trended over the last 12 months compared to the previous 12 months? Are there external factors that may be at play?
- Are there specific audiences that are responsible for more leads than others? If yes, why?
If you’re happy with the answers to this part of the audit, work with your Marketing, Direct Sales, and Channel Sales team to determine what’s working and how you can further maximize the results. If you’re dissatisfied with the lead quantity, collaborate with these same individuals to narrow down what strategies yield diminishing returns.
Lead Quality
Next, you must make sure the leads are well-suited for your business, which means analyzing lead quality.
First, there are Marketing Qualified Leads, or MQLs.
MQLs are leads that have expressed interest in your brand and are more likely to become customers than other leads but may not be ready to talk with a sales rep.
How many initial leads become MQLs tells you a lot about whether you’re targeting the right market. You may have a high lead quantity, but if only a few of those leads have the problem your product solves or can afford your asking price, they won’t turn into an MQL.
Now, MQLs may eventually turn into Sales Qualified Leads (SQLs), which are sales-ready leads that are likely to convert. This KPI reflects how effective your marketing team is at engaging with your MQLs and providing them with the right information.
Use this portion of your sales funnel audit to address the following questions:
- What percentage of leads become MQLs and, in turn, SQLs? Is there a significant drop-off between the two stages?
- What characteristics do successful leads have in common with one another?
- What strategies contribute to success (or appear to have no impact)?
With funnel audit insights in hand, you can take the following actions to better improve lead quality:
- Be purposeful with who you choose to partner by creating ideal partner personas and fine-tuned criteria for scoring candidates. If you fail to engage the right partners, it’s only natural that they’d bring poor customers.
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Create ideal buyer personas which can be shared by both Direct Sales and Partner Sales (with small variations). For example, check out those we created for CTOs, IT Managers, and more.
- Make sure your messaging is on point. Does your email marketing have a generous open rate? Do people who download one asset repeatedly download others? All these are signs that your marketing content resonates with MQLs.
Lead Velocity
Lead velocity measures how quickly leads move from initial contact to closed sale. It’s a great metric for measuring your sales process efficiency. A higher lead velocity increases revenues and cash flows by allowing for more deals in less time. Meanwhile, it reduces the chances of deals going under.
Some software solutions calculate lead velocity for you. However, you can do it by hand, too. Simply sum the time leads spend in your funnel and divide by the number of leads you get.
When auditing your sales lead velocity, consider how different audience segments perform against one another. It also may help to compare your Direct lead velocity against your partners’ average sales cycles. Then ask yourself if disparities could be due to differences in strategies or the prospects, themselves.
Looking to improve your lead velocity so your sales team is free to pursue more leads? Hone in on potential hold-ups by talking to Direct Sales and partners about:
- Stages where leads stall or get stuck
- Effectiveness of communication with leads
- External factors to consider, from cultural norms to economic factors
Conversion Rate
A conversion rate reflects the proportion of all your leads that end up buying from you. To calculate it, divide the number of closed deals by the total number of deals.
For example, closing five deals out of 50 total deals gives you a 10% conversion rate.
You can calculate the conversion rate across the entire funnel to see if your organization is closing enough sales. However, figuring it at each step of the funnel provides further insight into each stage of your process.
In short, this is the culmination of all the above. If your audit reveals that your conversion rate is lacking, work your way upward from the bottom of the funnel to the top.
Average Deal Size
Most SaaS and B2B companies offer packages of varying size—while a bunch of leads at the lowest price point is nothing to sneeze at, everyone knows that landing “whales” is what galvanizes revenue growth.
Therefore, when viewing sales audit metrics like generated leads and conversion rates, it’s important to view them through the lens of big deals vs. small deals. If your other funnel KPIs’ growth is driven primarily by lower-profit opportunities, you may want to reassess your approaches.
Sales and Marketing Content Engagement and Assisted Conversions
Using the right sales and marketing content goes a long way in pushing leads through the funnel and turning them into customers. For example, a solid welcome email sequence can improve conversion rates among leads that sign up for your email list. A strong product demonstration video can convince (or confuse) prospects. A case study that appeals to CTOs may alienate marketing managers.
Audit your library of sales and marketing content to see if there are ways you can improve. This could entail:
– Customer research with the aim of revamping your lead magnet so it better addresses prospects’ key problems
– Customers’ open and engagement rates with content marketing
– Tracked content utilization by Direct and Channel Sales teams
– The number of assisted conversions of materials, particularly as it relates to audience sects
Tools like Allbound’s Channel Insights feature let partner managers review how content supports sales cycles and related outcomes. Plus, they can generate reports which identify how content themes resonate with specific types of sales partners and customers, such as those hailing from a particular region or industry.
Additional Tips for Auditing your B2B Sales Audit
- Combine quantitative data with qualitative data. Numbers can tell a story but, depending on your interpretation, it may not always be the correct story. Therefore, once your initial stages of the sales funnel audit lead to hypotheses, use qualitative insights to prove/disprove your theories. Remember to be open-minded, which means not dismissing viewpoints that aren’t revealed by the data or vary from your own. After all, everyone has blind spots.
- Don’t think of sales funnel audits as rare, isolated occurrences. Ideally, your audit will lead to changes for the better. Instead of assuming that a strategic shift fixed all problems, conduct a follow-up audit to measure the impact (and reveal new opportunities for improvement). Refresh your sales funnel audit at least once a year.
- Share the audit results with other teams. A number of different teams play a role in your B2B sales funnel, so it’s valuable to keep everyone in the loop. Not only does the audit report grant them visibility into what’s working (and new motivation to improve), but they can offer fresh ideas on how to improve materials and processes.
- Don’t forget to consider outside factors when assessing your B2B sales funnel. It shouldn’t be news that 2020-onward has proven to be more turbulent than past periods for a variety of reasons. Therefore, make sure to view changes in prospects’ behavior with the additional context of what may influence their decisions and response to your strategies. For example, if your customer base is likely to be working with reduced budgets for 2023 than for 2022, they may be less likely to engage despite the strength of your messaging. Such insights into potential customers can help you better reach correct conclusions when auditing your sales funnel, as well as evolve your messaging and product offering to meet their shifting needs.
The Bottom Line About Sales Funnel Auditing
Continuous optimization is the reality of sales and marketing. You can never stop tweaking, testing, and improving because your business and your target customers constantly change.
For additional reading and resources that could further shape your approach towards your sales funnel audit, check out:
16 Partner Program KPIs to Measure Channel Performance – Your B2B sales funnel audit is only one component of the data analysis you should conduct. Regularly keep tabs on these 16+ partner program KPIs so you can swiftly identify issues as they arise rather than address them retroactively.
Templates for Your Channel Partner Program Strategy – The Allbound team regularly creates templates to assist channel sales professionals to overcome hurdles and find efficiencies. We welcome you to browse some of our favorites—you may just find the missing puzzle piece your sales funnel audit reveals.
What is Partner Ops and Why It Matters – If channel sales is Oz, partner operations is the man behind the curtain. If your audit reveals a serious problem in your partner sales funnel, chances are that operations (or lack thereof) are somehow involved.
Perfect Your Partner Management & Sales Framework – While the above-mentioned partner operations team has a hand in almost every aspect of your program, it’s not the only component keeping your Channel Sales afloat. Make sure you’re ready to act on your sales funnel audit’s findings by having a complete framework in place, from the right technology to a cemented procedure.
- 9 Steps to Creating a SPIFF Program to Incentivize Channel Partners - January 20, 2023
- 7 Steps to Successfully Onboard Partners - December 7, 2022
- 16 Partner Program KPIs to Measure Channel Performance - September 18, 2022