Sales Pipeline Automation

Sales Pipeline Automation

Sales Pipeline Automation 347 346 Hatchit NZ

It can be off-putting to think about Sales Pipeline Management in this sense, but your sales pipeline is the heartbeat of your business – if you don’t sell, and keep selling, you won’t be in business for long.

You may have given your sales pipeline some thought, you may know exactly how it works, but how many of the steps could be automated through your CRM, giving you clearer insight and better data to make decisions on?

What is a pipeline?

Your sales pipeline is the process your prospects go through to become customers. Calling it a pipeline helps visualise the movements toward a buying decision. Typically not all prospects become buyers so the narrowing of the funnel towards closure represents this natural “leakage” of prospects along the way.

Sales pipeline

Everyone has their own way of naming the pipeline stages, which is perfectly fine, but they usually follow a similar pattern:

  • Unaware – your potential buyer doesn’t know you exist
  • Aware – heard of you and knows broadly what you offer
  • Interested – in your product or service
  • Consideration – looking at alternatives and making comparisons
  • Decision – yes or no
  • Purchase – Yes!

Whether or not these are exactly the stages you use they should at least look familiar.

Whilst each is its own phase, they are interdependent, with the goal of each stage being to move a prospect to the next. Ensuring steady movement through the stages is how you make sales. Pipeline management is about identifying and resolving the problems that occur at each stage to ensure fewer holdups and a smoother journey for your prospect’s to become customer’s.

The sales pipeline in your CRM is a key tool to give visibility into sales performance. Measurement of the stages is your guide for developing your ongoing sales process, and whilst it can sometimes tell you some uncomfortable truths, you ignore it at your peril.  

Metrics that Shape a Healthy Funnel

Here are the 6 main metrics that we use at Hatchit to guide a healthy sales funnel, beginning with the most important of all – the qualified lead, with the key word being qualified:

1. Qualified leads

A lead on its own is always weak. A lead is just someone whose information you have that you think might be a good fit for your business. What makes them a qualified lead is up to you to define but it usually means they’ve made a concerted expression of interest. They may have downloaded some content, subscribed to a newsletter or contacted your office, but the important part is that they’ve signalled an intent that they might buy from you one day. The quicker you can help a qualified lead the better. Most CRM’s can help you define these leads in a digital sense with their lead scoring tools by seeing what page/s of your website they’ve visited and what actions they’ve taken and applying a score for each. You can then use automation to start nurturing straight away, meaning your leads don’t become disinterested again before you’ve even had time to get to them.

2. Win rate

This is the percentage of opportunities that are won. To calculate it, you divide closed-won opportunities by total opportunities that were both closed-won and closed-lost. So if you have a total of 20 opportunities and close 5 of them, your win rate is 25%. An additional win rate measurement you may decide to look at is when you exclude the early stages of qualification and measure only from when a proposal is submitted, as this can tell a story of how well you are moving your prospects to the proposal stage. Ideally you don’t want salespeople wasting time sending out a lot of proposals if they’re not ready to close. The important thing with either is to be consistent and objective so you can assess performance over time.

3. Average deal size 

This is calculated from all your closed-won deals and it’s a number that helps you project the number of sales you should be bringing in and the amount of work you should be doing to complete those deals. It can also be a resource allocation tool in larger organisations ie if your average deal size is $20,000 and someone is working on a deal for $100,000, you’ll need to decide how much effort it requires to follow it through and whether it’s reasonable, at the expense of other initiatives. If you start noticing a general upswing or downswing in average deal sizes, this may indicate that you need to rework your sales strategy.

4. Sales funnel leakage 

Some leakage is natural and in fact perfectly healthy. Not everyone who comes into contact with your business will become a customer and probably nor do you want them to. Part of the qualification process should be to qualify-out those prospects who aren’t a good fit for your offering. However, too much leakage is a bad thing for obvious reasons. If you’ve mapped out the key milestones along the buyer journey and studied the numbers to identify exactly where you are losing good fit prospects you should hopefully be able to identify why they didn’t follow through and do something about it.

5. Average sales cycle 

This is another really important metric to know: the average amount of time it takes from initial contact to a closed-won deal. You certainly don’t want this to be too long as you’ll be missing out on revenue and spending a lot of time still educating or qualifying prospects, but in many cases you also don’t want this to be too fast as your customers may have rushed their buying decision which can lead to a different set of problems later. What’s the right length for you is something you’ll need to work on and measure over time. Using your CRM you can extract and measure this data.

6. New leads generated 

Where it all starts. For any pipeline to flow continuously it needs a steady tap filling up the top. New qualified leads generated per month (or week if you prefer) helps you track the success of your marketing efforts and overall health of your sales process. Leads will always be weak to start with, but continuous nurturing and qualification will take them through your pipeline ensuring you always have a steady flow of customers coming out the bottom. Using your CRM you can track the amount of new leads you need to keep generating in order to set goals.

Once you’ve mastered these metrics you can start to bring in others and work on your own magic formula for success. Your CRM should be able to do it all at the touch of a button and then start to automate the repetitive tasks that help move your prospects from one stage to the next.

Here’s a few examples to give you some ideas:

A new lead is generated. Someone has entered their details on a webform or contacted you. CRM automatically sends a personalised welcome email and some follow up information that might be of interest.

Automation A = Lead responds to this email. CRM opens a new opportunity and assigns a sales rep to follow up. Tasks are set to remind the rep to make contact daily.  

Automation B = Lead doesn’t respond. CRM schedules a further follow up to be sent in x days with some further information to help nurture this lead.

A lead has become stuck. Your CRM has sent a series of follow ups and the lead has not responded. You’ve not been able to qualify-in or out this lead so the CRM moves the lead to an inactive status and schedules a reminder to try again in a month. After 1 month you are sent a reminder to see if this lead is a good fit to enter into a further nurturing sequence.  

A = yes. A new series of emails are automatically sent out by CRM with the aim of reigniting interest.

B = no. Maybe you’ve since identified this lead as a competitor who was just checking you out, so your CRM marks accordingly and stays permanently inactive.

An opportunity has been open too long. You’ve identified that an opportunity should ideally be open for between 1 and 3 weeks before moving to the proposal stage. So after 4 weeks from creation:

A = CRM automatically generates an activity report that is sent to you so you can see why the opportunity is stuck. Perhaps a meeting was missed, or a demo wasn’t completed. You have the chance to rectify this before it’s too late to save.

B = CRM automatically sends your prospect an email seeing if everything is ok and, depending on your product, includes notice of a special offer for all new customers who sign up this week (this example works better in an ecommerce or retail environment).

You’ve just won or lost a new customer.

A = Won. CRM can send a series of tips or training material.

B = Lost. CRM marks the opportunity as lost but sets a reminder for you to follow up in 6 months. As all good salespeople know, a “no” often just means “not now” but equally without a reminder they know they can also forget to follow up.  

Best practices for pipeline management.  

1. Know your pipeline

Before you can manage it, you have to understand it. You need to know where your customers come from, your usual conversion rate, how long it usually takes to convert a lead to a customer, and more.

You need to know what key decisions prospects are making that moves them closer to purchase. How do people find you? What pieces of content draw them in? What pain points do they have, and what information can you provide that helps them make a decision?

Once you know these things you’ll have a clear understanding of exactly how your pipeline works so that you know where to look to fix it if it breaks.

2. Keep detailed metrics on your pipeline and look at them regularly

It’s essential to first know your pipeline, but the second important step is to keep detailed metrics on how your pipeline performs. Here are the metrics you should always know:

  • How many leads per month each source produces
  • Lead-to-opportunity conversion rate
  • Opportunities-to-closed-won conversion rate
  • Average closed-won deal size
  • Average sales cycle length
  • Win rate
  • Total number of open opportunities

You can then regularly optimise your pipeline based off these numbers.

This goes hand-in-hand with point 1. In order to optimise your pipeline regularly, you also have to review it regularly. Regular reviews will help you determine trends, good and bad, that help you solve problems or allocate more effort.

3. Quickly fix problems as they arise

The great thing about carefully managing your sales pipeline – particularly if you have set notifications to tell you – is that you’ll be able to see when problems arise and fix them quickly. Here are some common ones you may see:

  • Stalled opportunities

These are opportunities that get stuck in one stage and don’t keep moving, and they’re at higher risk of not converting. If you know the average amount of time each prospect spends in each stage (and you should), you’ll know when you have opportunities at risk

  • Skipping stages

Prospects who go straight from lead to decision – or skip a properly defined stage – are less likely to convert and stay as happy customers. If you track where your prospects are going, or if they’re skipping stages, you’ll be able to re-engineer your sales process to their specific journey to raise the likelihood of a proper conversion. Alternatively if it happens regularly you may have to rework your stages, or you may have a case of a salesperson not completing information properly or “sandbagging” sales in order to make an incentive. Either way it’s a flag!

  • Too many open opportunities

More is not always better. It’s competitive nature not to give up or want to close an opportunity that isn’t moving, but it’s far better to have a clean pipeline with fewer, high-quality prospects than just lots of open deals that on the surface look impressive. Too many will bog you down because you’ll have to spend way more time sifting through to find the quality ones. Time will tell how many is right, but in most B2B cases it’s hard for anyone to be actively working on more than 10 at any one time.

Keeping a close eye on your sales pipeline, automating the steps within it and using the tools within your CRM to notify you when things are going awry will be well worth the work. The results of a well-managed pipeline will show themselves directly in your bottom line.


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