Business development is a business unit within a company or organization that works to fuel growth and profitability in the long-term. Effective business development involves more than just closing deals and generating sales. Here are eight metrics you should track to measure the effectiveness of your business development efforts.
Reach measures your organization's footprint across all channels. This includes your email database, blog subscribers, customer base, social media following, and anyone else your organization can reach with marketing messaging.
This Brand Awareness Dashboard from Databox and MashMetrics does a great job visually displaying reach:
2. Lead Conversion Rate
The most common lead conversion actions are contact form submissions and phone calls. To get your Conversion Rate, divide the above total number of conversions by the number of visitors to your website. For example, if your website has 5,000 visitors and 100 of them fill out a contact form, your conversion rate is 2%. If you find that your conversion rate is extremely low (less than 1%), you might want to add attractive content offers (eBooks, whitepapers) to compel your visitors to hand over their contact information.
3. Number of Leads Generated Per Month
How many people contact you via phone, in person, or through your website and express some interest in your products or services? In addition to tracking total leads per month, you can also track total leads per channel (web, phone, social media, etc.) to see which ones are most effective.
4. Leads Presented-to-Leads Worked %
Of the new leads that came in, how many did you try to contact?
According to an article on Hubspot, "The percentage of leads worked by the sales team is a great -- not to mention quick -- measure of the initial quality of leads presented to your sales team. If a sales rep simply won't call or email a lead given to them then something is wrong with the quality of the lead, or the handoff/agreement between sales and marketing."
5. Leads Worked-to-Leads Connected %
From the same article on Hubspot, "The percentage of leads that sales is able to connect with reflects how likely or willing a marketing-generated lead is to take the next step to talk with sales, and/or reflects the effectiveness of the sales rep's follow up approach."
6. Pipeline Value
Pipeline value is the aggregate value of all the active opportunities at each stage in your sales pipeline. A weighted pipeline will show your predicted forecast for the month, quarter, or year ahead.
7. Lead Close Rate
How many leads are converting to customers? Your new customers divided by total number of leads in a given period is your average lead close rate. If sales are low but your lead close rate is high, you may need to ramp up your marketing efforts to bring in more qualified leads. Conversely, if you have a low lead close rate with a high number of leads, you might need to work on your sales presentation and follow up process.
8. Sales Target
Measure and compare current sales to a target or past performance.
According to Klipfolio:
"The Sales Target KPI measures current sales (either dollar value or number of wins) and compares that value to a target or past performance. This simple sales KPI taps into the competitive nature of sales teams by visualizing their performance in a tangible way.
The key to this KPI is setting an appropriate sales target. This requires a deft touch, as a goal that is set too high will be viewed as unachievable and will drain morale; on the other hand, a goal that is set too low will fail to motivate your team to go that extra mile. One of the most common ways to develop this KPI is to compare current performance to the previous period, for example, showing new wins this month compared to wins last month."
Which business development metrics are you tracking? Let us know in the comments!<