A Step-by-Step Guide to Identifying Sales Patterns Ed Chessman April 05, 2023
Sales leaders leave no stone unturned in their never-ending quest for revenue. The smart ones do so with methodical precision, but it's the great ones that know how to discover deeply-hidden sales patterns that will sharpen and refine every facet of their sales strategies. It takes more than just great business acumen, too.
Identifying sales patterns is important, because 59% of salespeople claim to stick to their methods once they have determined what is effective for them, and do not make any changes. That suggests that there's a lot of untapped potential out there somewhere.
It all starts with collecting the right sales data. Then, with the right tools and methodology, we can explore and identify sales patterns and trends. Understanding how and why things happen across a sales pipeline creates informed decisions that improve sales performance and drive more revenue.
So how do we unleash the hidden gems of potential in a sale? This article provides a step-by-step guide to identifying sales patterns.
We're not talking about buying patterns
Before we get into the juicy details, let's make a quick distinction between buying patterns and sales patterns. Buying patterns are all about why and how consumers make purchase decisions, and these sit nicely in the domain of marketing. A sales pattern, on the other hand, is the why and how of revenue growth. Identifying the right sales patterns provides sales leaders with the divine insight required to make informed business decisions, and push the needle in the right direction.
Identifying sales patterns can make a significant impact, too. According to research by the Mckinsey Global Institute, organizations that rely on data-driven approaches are 23 times more likely to excel at acquiring new customers, compared to their competitors.
1) Start by figuring out your goals
Before you dive into crunching the numbers, it's important to start with the right KPIs and objectives. Start by thinking about the key decisions you need to make, for example:
If I hire more BDRs, will I increase my revenue?
Why are my deal conversion rates slowing down?
Who are my most profitable customers?
What sales effort and activity is delivering the sales performance?
What is the true acquisition cost for each customer?
2) Then get specific
Next, we consider what we are trying to identify sales patterns for. Yes, everything is about increasing revenue, but we need to get into the specifics of how we want to increase sales. For example:
By increasing sales conversion and close rates
By improving sales velocity
By increasing operational performance
One we have defined where we want to drive change, we can think about other areas of opportunity, like:
What trends might exist in the data by region, industry, and customer segment?
Are there spikes that we can identify and capitalise on?
What actions correlate with specific sales trends?
All of these questions could produce valuable insights into the activities that deliver positive impact, as well as growth of sales pipelines, revenue, and ultimately, market share.
3) Now define the sales patterns
With our KPIs and success metrics now defined, let's identify all the potential sales patterns we want to analyse, in order to figure out what data will be required. Sales reps in each of our sales teams faithfully record their activity, meaning we all have mountains of sales data, right?
Here are the three types of data required to identify sales patterns:
i) Conversion data
Leads, to opportunities, to deals
Leads that start trials
Trial or free users to paid users
Deal progression by sales stage
ii) Operational performance data
Retention and churn rates
Sales cycle length
Average annual contract value (ACV)
Customer lifetime value (CLV)
iii) Sales performance data
Number of new meetings booked
Number of opportunities created
Pipeline growth
Win rate, forecasting accuracy, and deal slip rate
3) Several types of sales pattern analysis
Luckily, we don't need to be hard core mathematicians, thanks to the proliferation of tools available that we can use to explore our data.
There are several types of analysis we can use to tease out the key findings and sales trends we desire:
Performance analysis for sales reps, tracking coaching, and development against KPIs.
Pipeline analysis to measure average deal size, sales cycle length, and close ratios.
Lead analysis to measure quality.
Predictive sales analysis looking at historical data and current pipeline to understand whether the forecasted close rate is on target.
Each type of analysis explores different facets of the data to collectively deliver the knowledge and insight that will improve sales activities and effectiveness.
4) Don't boil the ocean
According to recent statistics, a significant majority of organizations (82%) have plans to enhance their investment in data modernization during 2023. Today, tech exists to capture and measure everything: from pipeline, sales activity, and sales forecasting, all the way to product sales, market demand, and insights from supply chain management.
When it comes to putting together a solution, the wisdom from McKinsey is to design and pilot a "minimum viable cockpit." The central idea is to start with a simple dashboard, displaying basic sales data, and a sales pattern or two to deliver value.
5) The rise of AI
Video: Six ways AI is taking over sales
There are a number of areas where new AI tools are helping to improve sales reps' performance:
Personalized sales coaching: analyzing calls to provide feedback on areas like opening techniques, tone of voice, objection handling, and closing techniques, so you can perfect your conversational growth strategy.
Predictive lead scoring: allowing sales reps to focus their efforts on the most promising leads.
Automated sales outreach: automating repetitive tasks, like lead follow-up.
But we need to keep it human, too. That's why the folks at glass.io are replacing cold and lifeless chatbots by enabling sales reps to talk to informed customers at exactly the right moment.
In closing
In today's data-driven business landscape, sales leaders need to be able to identify and leverage hidden sales patterns to improve sales performance and drive more revenue. It's about having the right intelligence to direct sales effort for maximum impact.
Identifying sales patterns provides insights into what works and what doesn't, allowing us to make informed decisions that improve sales performance and drive revenue growth. By identifying sales patterns, companies can optimize every sales process, increase sales performance, grow revenue, and ultimately create a competitive advantage in the marketplace.
Ed Chessman is founder of cowXsales, a startup sales consultancy. He has created and closed over $22M in new business revenue leading sales for global software companies and early stage startups. Early stage tech startups are Ed’s true love where he enjoys working with founders to build great products. Ed lives on the south coast of England where he enjoys spending time with his family, running in the South Downs, and trying to master the art of sea swimming.
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