Rapid changes in technology are amplifying issues for how B2B organizations can manage their revenue funnel. Because marketing and sales organizations often use different tools and track different metrics, key information about the marketing and sales processes are often scattered across many systems.
As a result, many companies are not able to clearly see what’s happening inside their marketing and sales funnels.
But when you listen to the story within your data and pair it with buyer signals from the broader web, you can take data-informed actions to optimize every stage of your funnel.
In this blog post, I’ve partnered with our friend and revenue optimization expert – FunnelWise – to show you how to optimize your funnel.
Below, FunnelWise shares some great insights on how to benchmark your current performance through key funnel metrics as well as their latest external benchmarking data from primary research. Then, I’ll show you how you can tap into use external buying signals from the broader web to fuel your marketing and sales efforts.
Why does benchmarking matter?
Benchmarking sets the bar for your marketing and sales efforts and helps you determine areas for improvement, develop appropriate actions and playbooks to create the gaps and scale upon successes.
Benchmarking is just the practice of reviewing and measuring what happened yesterday, so you can establish comparison criteria for your future efforts.
To benchmark effectively, you’ll need to establish your criteria
It’s time to determine ideal results for each stage of your funnel:
Net new movement measures how many prospects are entering the funnel, where they are entering (top, middle, or bottom) and if they are progressing sequentially or jumping between stages.
Conversion rates measure the successful forward movement of prospects in the revenue funnel.
Velocity measures the speed at which prospects move through the funnel.
These metrics serve as key performance indicators and help you figure out which actions will have the biggest impact on your revenue.
Be sure to leverage external benchmarks too
FunnelWise has conducted research from a variety of marketing and sales departments within the technology industry and determined four key benchmarks specific to revenue funnels. They looked at more than 500,000 marketing qualified leads (MQLs) and more than 150,000 opportunities.
These benchmarks can serve as a starting point for setting your KPIs.
1. Marketing Qualified Lead Conversion to Opportunities
The best performing marketing organizations have 30 percent or more of their MQLs convert to qualified sales opportunities.
A marketing qualified lead (MQL) is a lead that is generated by marketing and has been deemed qualified to be handed off to sales for follow-up.
Both marketing and sales are responsible for communicating about prospects who have moved into this handoff stage. Benchmarking the conversion rates at handoff stages is beneficial, as this is where issues often occur and leads might get overlooked or not receive the proper follow-up.
2. Marketing Qualified Win Rates
The best performing marketing organizations have opportunities that are influenced by marketing win at a higher rate than opportunities that are not influenced by marketing (or sales generated ones).
Another key benchmark compares the win rates of opportunities influenced by marketing against those created by sales (meaning they were not influenced by marketing). If your sales-generated opportunities are winning at a higher rate than your marketing-influenced opportunities, then you need to better understand who sales is targeting and how your marketing team can improve its return on investment.
3. Sales Process Consistency
The best performing sales organizations have bottom-of-funnel process inconsistency of 10 percent or less.
When there is a high level of non-sequential movement in the opportunity stages (meaning, prospects are entering the opportunity stages further down in the sales cycle, moving backward in the funnel or skipping stages entirely), it is indicative of process inconsistency in the bottom of the funnel. Ideally, opportunities should move sequentially through the sales cycle, but some skip stages and others enter mid-way.
A benchmark of 10 percent inconsistency or more means your SDRs (sales development reps) or salespeople aren’t following the processes mapped out by the funnel blueprint, which means they may be skipping the appropriate activities for certain stages.
4. Win Rate Variance
The best performing sales organizations have win rate variance of 10 percent or less across team members.
Win rate variance is the range of different win rates that result from different sales team members working similar opportunities. Sales teams vary in training, skills and knowledge, but often they sell a common product or service. Win rates will vary, but ideally they should have a variance of 10 percent or less, according to the best performing companies FunnelWise analyzed.
Similar to the process inconsistency variance, your company can have a high win rate variance but still be meeting goals. Measuring variance helps you identify gaps in training or determine how to improve the sales process based on the sales team members achieving a higher win rate.
Great, what else can I do to improve my funnel performance?
A lot of funnel problems come down to one simple fact: many organizations don’t have enough actionable intelligence on their target prospects and accounts to be able to effectively engage them and move them through the buying process.
Many of us today still think of a lead profile as a set of static fields. We think about data points like a person’s name, contact information, job title, location and firmographic information such as company size, industry, revenue and perhaps more specific information like the technologies in their stack.
At this point, you can collect data on a prospect’s actions across their entire online and offline pre-purchase experience, including the influencers they follow on Twitter, the trade publications they read, the product reviews they read on a software review site, the roadshows they attended, the emails they clicked on and the pages they visited on your website.
All of these digital activities give you clues about people’s interests and impending purchases and are known as buying signals.
At this point, there are data providers and publishers who are tracking buyers’ digital activities or footprints across the web or across social networks and surfacing buying signals.
By tapping into these third-party data sources such as Socedo, you can identify which accounts and contacts are entering a buying cycle, see what topics and product categories they care about, and then focus your resources on the right companies and effectively engage them at each stage of the funnel.
To learn more about how to benchmark your performance and improve your results with third party signals, FunnelWise and Socedo have put together a complete guide to help you through this process. Download it by clicking on the image below: