Making a successful sale – this is what lies at the core of a successful business, whether it operates in the industry of retail or technology. Nonetheless, in order to gauge how successful a contact method is, it is critical to utilize the right KPIs – key performance indicators. To that end, the percentage of sales by contact method examines the way in which different approaches are likely to land on a purchase or not. Of course, you cannot expect each tactic to be equally successful – which makes this metric really useful.
After establishing what works best in your business, you can consider optimizing that strategy and using it to your benefit. Some of the most widely used contacting methods include telephone, email, or face-to-face. Experts recommend marketers and analysts to use this metric in combination with the sales rep performance metrics. That’s primarily because some representatives might deliver better results when it comes to finalizing a sale than others.
Each contact method comes with its share of costs. Essentially, some approaches are costlier than others, when it comes to time and financial resources. Let’s take an example. When a salesperson meets face to face with a potential client, the win rate might be much higher than the telephone or email contact method. Nevertheless, this approach is much more expensive – not only that it entails traveling costs, but there is also a lot of time that goes in this direction.
So, a good idea might be to use this method for high-value prospects, to optimize your chances. Nevertheless, when it comes to other types of prospects, you should focus exclusively on phone or email, as these are more cost-efficient.
Moving on, how do you calculate this metric? The formula is as following: sales per contact method/total revenue. The relation between contact costs and method is the key to determining what would work best for your business in regard to profitability.
Optimizing Your Success Rate
What could be conveyed as a successful indicator? Your target as a company should be to maximize your sales and, thus, also maximize your profits, by increasing the volume of sales. However, ideally, you should be able to maximize your profits whilst utilizing a low-cost type of contact.
On a different note, you should aim at diminishing the number of sales that entail a low yield, yet a high cost per contact method. The good news is that, at the time being, there are numerous selling methods you can choose from, allowing you to pinpoint exactly what would apply best in your business and industry. You should make a priority out of understanding customer behavior and how your audience is likely to react in given situations. Perhaps it might be a good idea to offer your employees a training program that would perfect their skills in this area.
After calculating the percentage of sales per contact method, we encourage you to monitor other sale KPIs. The results from a singular KPI, irrespective of its usability and value, won’t provide comprehensive insight into your company’s activity, so make sure you bear this in mind.