9 Key Metrics for Evaluating Your B2B Sales Performance

B2B sales professionals spend 30% of their time selling. And only 7% of top B2B salespeople use a pitch. 

Other activities like prospecting and qualifying leads take up a lot of their time. 

That means many sellers spend less time interacting and building strong relationships with prospects and customers.

What can sales managers within B2B companies do to help sales reps be more active in the field?

The key is to boost sales productivity.

But you can’t know how productive your B2B sales team is if you’re not measuring their performance.

Doing so will help you understand complex buying cycles, the best ways to nurture relationships, and how to optimize strategies to appeal to individual business clients.

Tracking B2B sales performance also helps answer key questions: 

How well are we hitting our sales targets? How much revenue are we generating from B2B sales efforts? 

How robust is the sales pipeline, and what’s the conversion rate at each stage of the buying journey?

In this blog, we discuss the metrics that give you something to focus on during sales performance reviews and help you identify ways to improve.

What Are B2B Sales Metrics?

Business-to-business (B2B) sales metrics are key performance indicators (KPIs) that measure and evaluate sales performance. 

By tracking business-to-business selling KPIs, you can:

• Track progress toward established targets
• Manage individual and team performance 
• Identify high-level trends
• Highlight successes
• Find pain points

When understanding B2B sales metrics, one thing to note is that metrics and KPIs aren’t the same. 

For example, all KPIs are metrics. However, not all metrics are KPIs. 

Think of it like this: when you create your website, you’ll pay attention to certain metrics like traffic, unique visitors, and dwell time. You do this from your CMS or analytics dashboard.

Metrics are quantitative numbers that measure sales activities and performance over time. They’re specific and targeted. 

On the other hand, KPIs give you a glimpse of the bigger picture as they help you measure your sales performance against your company’s strategic goals.

For example, a sales metric might be the number of sales calls a B2B sales rep makes within a specific time frame. 

While the metric provides data on a specific activity (B2B sales calls made), it doesn’t really indicate its impact on overall performance or strategic goals.

The conversion rate does. It’s a KPI that directly ties to an overall objective (closing sales).

In this article, we’ll include both B2B sales metrics and KPIs. So, knowing the key differences between the two will help you determine which ones best serve your needs and goals.

9 B2B Sales Metrics to Guage Your Performance

Now that you know what sales metrics are, what they measure, and why they’re so important, let’s look at some of the most popular ones.

1. Sales Pipeline Velocity

Sales pipeline velocity measures how fast opportunities move through your sales pipeline. A high velocity means you’re closing B2B deals and generating revenue at a faster rate.

Formula: Number of opportunities x Average deal size/Length of sales cycle

To measure sales pipeline velocity, multiply the number of opportunities by the average deal size. Then, divide that number by the length of the sales cycle. 

Let’s look at an example. 

Your company has 50 opportunities in its sales pipeline. And the average B2B sales deal size is $10,000. The average length of the B2B sales cycle is three months (or 0.25) years.

So, you’d multiply 50 by $10,000, which is $500,000. Then, divide that by 0.25. Your sales pipeline velocity is $2,000,000.

This means that, on average, your company is generating $2,000,000 in revenue per quarter from the opportunities in its sales pipeline.

2. Win Rate

The win rate is the percentage of sales opportunities that lead to closed deals. This is a great metric for evaluating your sales team’s ability to convert leads into customers.

Formula: (Number of closed deals/Total number of sales opportunities) x 100%

For instance, imagine your sales team had 100 potential sales opportunities during a specific timeframe. Out of those opportunities, they closed 20 deals.

Divide 20 by 100. You get 0.20, and you multiply that by 100%, which equals a 20% win rate. So, out of all the sales opportunities your team pursued, they successfully closed 20% of them as deals.

3. Average Deal Size

The average deal size in sales is the average value of deals your team closed within a specific period. This metric is extremely valuable because it gives you insights into the typical revenue your company generates per sale.

Formula: Total revenue generated/Number of deals closed

Here’s an example. Your company generated $500,000 from 50 closed deals in a given period. Divide $500,000 by 50. Your average deal size is $10,000. So, on average, each deal your company closes is valued at $10,000

4. Customer Acquisition Rate

The customer acquisition rate evaluates the speed at which your business gains new clients during a designated time frame.

It helps you measure the number of new customers you gain over a certain period of time. 

Formula: (Number of new customers/Total number of customers) x 100%

For example, you acquire 50 new customers in a month. At the beginning of the month, you had a total of 500 customers. 

So, using the formula, you divide 50 by 500, which equals 0.10. After that, you multiply that by 100% and you get 10%. 

Your customer acquisition rate is 10%, which means your company acquired new customers amounting to 10% of your current customer base within the month.

5. Customer Churn Rate

Customer churn rate is a B2B sales metric that represents the percentage of customers who stop doing business with your company over a given period. 

Formula: (Number of customers lost/Total number of customers at the start of the period) x 100%

For example, you own a B2B company that offers OAuth, an open standard authorization protocol. 

And you had 1,000 customers at the beginning of the month. By the end of the month, 50 customers had stopped using your service. 

Divide 50 by 1,000, which is 0.05. Multiply 0.05 by 100%, and you get 5%, your customer churn rate. 5% of your customer base stopped using your services within that month.

6. Customer Acquisition Cost (CAC)

Customer acquisition cost (CAC) equals the total cost of acquiring a new customer. 

Formula: Total cost of acquiring customers/Number of new customers acquired

For example, you spend $10,000 on marketing and sales efforts in a month. From these efforts, you gained 50 new customers.

To calculate CAC, you divide $10,000 by 50. So, the total CAC is $200. On average, your company spent $200 to acquire each new customer during that month.

7. Number of New Qualified Leads

The number of new qualified leads measures the number of potential customers who are interested in your B2B products or services. These are leads that sales have marked as suitable for further sales efforts.

There’s no specific formula to follow to determine the number of new qualified leads. But to help you get a better grasp of the metric, we’ll look at an example.

Let’s say your company’s marketing efforts generated 200 leads in a month. After qualifying them, your sales team chooses 50 of these leads to pursue. 

So, the number of qualified leads is 50. That means 50 potential B2B buyers meet the criteria your company has set for qualifying leads. Your marketing teams pay special attention to this metric. 

8. Average Time to Close

The average time to close is, on average, how long it takes to convert a lead into a paying customer. It starts from ‌initial contact to closing the deal. Typically, the B2C sales cycle is shorter than the B2B.

So, this metric allows you to see how effective your B2B sales process really is. 

A shorter average time to close means you’re doing a pretty good job at driving sales and converting leads into ideal customers. 

On the other hand, a longer time for a client to make a purchasing decision might mean there are bottlenecks or inefficiencies that you may need to address.

Formula: Total time to close deals/Number of deals closed

Let’s say your company closed 20 deals in a month. And the total time it took to close these deals was 100 days.

Using the formula, you divide 100 days by 20 deals, and you get five days. So, on average, it takes your company five days to convert a lead into a paying customer.

9. Sales Revenue Generated

Sales revenue measures the total amount of revenue your company generates from sales within a given period.

Monitoring sales revenue helps your company assess progress toward revenue targets and identify areas for improvement.

You don’t need a formula for this metric because all you need to determine is the total revenue your company generated from sales transactions within a given period.

Here’s an example. Your sell session replay technology. And you generated $500,000 in sales revenue in a month. You can then use that figure to project your yearly sales figures, which will likely reach $6,000,000 ($500,000 x 12 months). 

Start Measuring B2B Sales Performance Today for a Competitive Edge Tomorrow

Now you know what metrics to look at and track to help you measure B2B sales performance. And those are just a few. 

There are hundreds, or maybe even thousands, of sales metrics out there.

But the key is to only focus on a few. Look at your company’s sales objectives. Consider your overall goals. Then, look for metrics that give you an idea of how you’ve accomplished those targets. 

From there, you can start optimizing your sales approach to boost performance.

The outcome? You’ll be well on your way to improving your B2B sales strategies quicker than you can say “deal closed.”