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75+ Business Metrics and KPIs – The Ultimate Guide

Estimated reading time: 21 minutes

Table Of Contents

What are your key business metrics? There are sales enablement, sales and marketing metrics, and countless others depending on where your team sits organizationally, and at what level your position requires you to focus.What are your key business metrics? There are sales enablement, sales and marketing metrics, and countless others depending on where your team sits organizationally, and at what level your position requires you to focus.

In this article, we will break down every possible metric and answer questions like:

  • How do you measure sales enablement?
  • How do my customer success programs impact revenue retention and new sales revenue?
  • What Sales KPIs should I be using?
  • What business metrics do I care about if I am taking support calls from customers?

We will begin our conversation by first explaining what we mean by key performance indicators (KPIs) and business metrics then explore performance (leading) and outcome (lagging) indicators all go-to-market teams should be aware of and consider in their work.

What are metrics?

Metrics are simply quantifiable measurements of the work we do.

Business metrics fall into two major categories:

  • Performance Metrics (aka Leading Indicators)
  • Outcome Metrics (aka Lagging Indicators)

We’ll explore these categories of business metrics in detail in a few moments.

Note: We will use performance and leading interchangeably in this article. We will do the same for the outcome and lagging metrics.

What are KPIs?

KPIs, or key performance indicators, are business metrics that a company uses to measure its progress on key targets.

Think about these key metrics as the small number of data points the business reports on to the board or stock market.

  • You may use Sales KPIs like average contract value and win rate while your overall sales metrics could broader.
  • Your marketing KPIs may focus on total marketing qualified leads and their conversion rate to sales qualified leads, but you may also track an addition handful of marketing metrics.
  • Your customer service KPIs may be the # of escalations while you are still monitoring other metrics like average response time.

What are performance metrics?

Leading indicators are simply those you can measure as a direct outcome of your work. 

These metrics are leading because they occur before the impacts on the business. They are, therefore, indicators of what’s to come if your team continues doing what it’s doing.

For example, if you deliver an onboarding session, the number of attendees would be a performance metric.

There are a large number of potential performance metrics; consider these.

Leading Training Metrics

Here are a few typical leading training metrics:

  • The number of reps attending a session.
  • Percentage of people completing a specific course.
  • The percentage of people passing a specific course.
  • Amount of training collateral created over a given period.
  • The time teams have spent consuming training.

Learn more about The Surrounded Learner Technique to amplify your training efforts.

Sales training can be a critical investment or a waste of time. The Surrounded Learner Technique is the key to your team's success.

Content Metrics

Here are a few typical performance metrics used to measure content usage during the sales cycle and beyond. We have included a mix of marketing metrics, enablement, and sales metrics, as well as support and success metrics to provide you with a broad perspective on these leading indicators.

  • The number of people sharing a specific piece of content.
  • Level of engagement the sales team sees from customers receiving particular pieces of collateral.
  • The number of pieces of content created over a specific period.
  • The number of times a piece of content is shared to prospects in a given sales stage of a deal cycle as you go along the buyer’s journey.
  • The percentage of content used out of all possible pieces.
  • The average age of your content.
  • The frequency with which you are auditing and updating the content you are providing sales reps.
  • Web pages updated
  • Website traffic metrics like click-through rates (CTR) and dwell time
  • Search engine rankings for important terms
  • Articles accessed in the knowledge base overall, by each customer, by each product or service
  • Social media messages sent and overall reach

Note that some of these are often used as sales enablement KPIs, marketing metrics, etc.

Leading Coaching Enablement Metrics

Here are a few typical leading indicators:

  • The number of people coached in a given period.
  • Hours of coaching for all sales reps, on average.
  • Percentage of managers able to deliver coaching.

Note that these are often viewed as important sales enablement KPIs.

Leading Process Enablement Metrics

The following metrics are common leading indicators:

  • The number of business processes evaluated.
  • Overall business process time savings or other ways to measure efficiency or effectiveness
  • Expected time savings, growth, etc., for a given process adjustment.

Leading Sales Enablement KPIs – Onboarding

As you hire new sales reps to help you meet sales goals, you need to get them ramped quickly. Here are a few typical leading indicators used to measure Sales Enablement onboarding activities.

  • The number of new reps onboarded over a given period of time
  • Ramp time for each cohort of new hires onboarded.
  • The number of hours of onboarding provided per onboarding session.

Leading Customer Success Metrics

Revenue Enablement supports existing customers via the Customer Success organization. Here are a few of the leading indicators:

  • How many weeks to onboard a new customer
  • Meetings per month between Customer Success and Customers
  • Time to first customer QBR (for onboarding of CSMs)
  • Percentage of customers with mutual success plans

Leading Inside Sales Metrics

Your inside sales teams are focused on making phone calls and sending emails, whether to warm or cold leads. The typical leading metrics that they are measured upon include:

  • The number of calls made by your SDR/BDR teams
  • Emails sent
  • Meetings set up
  • The number of cadences completed

Performance Metrics for Customer Service

The business metric focus for this team will include:

  • The number of open customer escalations.
  • Average response time
  • Time to first response
  • Average resolution time for issues reported
  • Total issues and a breakdown of bugs vs. how-to type responses.
  • The volume of issues for each product or service, or functional area, use case, etc.
  • Customer satisfaction (CSAT) scores
  • Customer effort scores (CES) – How much effort did the customer have to put into resolving the issue?

     

The Customer Escalation Process

Leading indicators for presales engineers

Consider the following leading indicators for presales success.

  • The number of deals closed with presales support.
  • Time spent by presales on deals.
  • Percentage of deals won/lost when presales were involved vs. when not involved.
  • Deal value when presales were involved vs. when not involved.

Leading Indicators Marketing lead generation

Some of the more common metrics include.

  • The number of new leads generated in a given period.
  • The number of touches (calls, emails, webinars attended, etc.) to create a lead.
  • The number of leads converted to marketing qualified leads (MQLs).
  • The number of MQLs converted to sales qualified leads (SQLs).
  • Cost per lead.

Performance Metrics for social media marketing

  • The number of followers (or fans) on various social media platforms.
  • Likes, shares, and retweets of content.
  • Leads generated from social media campaigns.
  • Website traffic from each social media platform.

While every business will have different needs, the example performance metrics provided above will give your company guidance as you choose your important leading indicators.

All business metrics must always align with business goals

We never perform sales enablement activities merely to create content, train individuals, deploy new sales enablement tools, or anything else.

We don’t create web pages simply because we feel they are needed.

And we don’t make sales calls, respond to support emails, or set up QBRs simply to complete those actions.

We perform each of these activities to meet our company’s performance targets (e.g., specific financial performance goals).

As you measure your impact on your company, are you keeping this in mind?

What are outcome metrics (aka lagging indicators)?

Outcome metrics cannot be measured as a direct outcome of your activities. 

Lagging impacts happen downstream from the leading indicators, as a result of the actions you are taking (e.g., delivering a training session).

These outcome metric targets come from the boardroom and executive team and are what the marketing, sales, and the entire go-to-market team focus on achieving. 

For example, business metrics like revenue attribution, cost of goods sold, revenue by product line, average quota attainment, and average deal size would be lagging indicators.

Consider this example. If you deliver a training session for a new product, the time to first product sale would be a lagging indicator, and the number of people attending the session would be a leading indicator.

The critical outcome metrics for your business

Each successful business will have outcomes that matter most to it, ranging from the customer lifetime value, revenue cost of goods, churn rate, revenue per widget, and so forth.

The outcome metrics we cover here are intended to provide you with the most common lagging indicators, and we will continue to add to this list as we hear from you, our readers.

These make great marketing, customer service, enablement, operations, and sales KPIs.

Sales Forecast Accuracy

Sales forecast accuracy is an excellent gauge of your leadership’s maturity and its ability to meet its sales commitments across a given time.

We have created an in-depth article on sales forecast accuracy to help you with this critical sales KPI.

Business metrics like sales forecast accuracy play a vital role in company performance and success.

Content Marketing ROI

Content marketing ROI is, as the name implies, the ratio of sales attributable to marketing-created content vs. the cost of creating that content.

If your CMO does not know this number, send them to the ops team.

We have created an in-depth article on content marketing ROI to help you with this critical sales KPI.

Helping marketing be more efficient will allow them to focus on developing the right materials, leading to increased revenue attribution for your team and your business.

This business metric also provides a good indication of how well your marketing and sales teams are coordinating their activities.

If your marketing efforts are not aligned with your sales team, bad things happen. Indicators like this should provide you with an early warning before you see a negative impact on the financial metrics your CFO is watching.

Sales Efficiency

What is sales efficiency?

Sales Efficiency (Net, Gross, and Otherwise) is an important metric that demonstrates the incremental revenue you earn against what you invest in sales and marketing.

I favor net sales efficiency as it takes the sum of the amount of incremental revenue gained minus the amount of revenue lost due to customer churn and divides it against the number of dollars invested in sales and marketing and customer success in a given time.

As a simple example, if your net incremental revenue in a given year is $10, and you spend $1 on sales, marketing, and customer success, your net sales efficiency will be 10.

Sales Efficiency is a good number to track closely as you scale your business and a leading driver as you seek to tie your efforts to revenue attribution.

Sales Productivity

What is sales productivity?

Sales Productivity is the average amount of new revenue per seller for a given period of time. Based upon this, how do you calculate sales productivity?

(Total Revenue in Time Period)/(Number of Sellers during Time Period).

If you made $100,000 in a quarter and had 10 sellers employed during that time, your sales productivity would be:

($100,000)/(10)

Sales Productivity = $10,000

Deal win rate

What is the Deal Win Rate?

To calculate, divide the number of opportunities you won by the number of opportunities you opened over a given period. This measure of sales performance can get very complicated when dealing with long deal cycles, typical in Enterprise B2B sales.

Research has shown that the Average Deal Win Rate is 47% (per Research published by the RAIN Group).

Note: Learn more about influencing deal win rates, and use our FREE calculator.

Want to increase your revenue attribution? Help your team win more of the deals they are competing in.

Deal velocity

Deal velocity (sometimes called sales cycle length) in this example is merely the average number of days/months it takes an average deal to move from the beginning of the sales funnel to the end with a closed/won or close/lost decision.

You may also want to learn more about the Sales Velocity Equation, a popular metric in some businesses. 

Note: Learn more about this metric by using our Sales Velocity Calculator.

Want to increase your revenue attribution? Help your team win deals faster.

Churn rate

What is the churn rate?

Recurring revenue is critical for any software as a service (SaaS) business. The churn rate is the percentage of customers who end their subscription to your service. 

The churn rate is often calculated based upon more complex formulas because customers may only unsubscribe from one product vs. all products.

Some businesses calculate the churn rate against the contract value versus the raw number of customers to account for this point.

Want to increase your revenue attribution? Help your business keep more of their customers.

Note that customer retention rate is simply the opposite measurement.

What is gross revenue?

Gross revenue is the total amount of money a company has earned from sales. This metric does not take into account any costs, such as returns or discounts.

What is net revenue?

Net revenue takes gross revenue, subtracts all costs, taxes, fees, refunds/returns.

What is gross revenue retention?

Gross revenue retention is the percentage of gross revenue that a company retains from one year to the next. This metric looks at how much money a company has kept, regardless of whether it has increased or decreased.

What is net revenue retention?

Net revenue retention is the percentage of net revenue that a company retains from one year to the next. This metric looks at how much money a company has kept, after taking into account all costs, taxes, fees, refunds/returns.

Gross retention vs net retention

Net revenue retention is a more accurate metric to look at when trying to understand whether a company is retaining its customers.

If you are a CEO, CFO, CRO, or similar, you should be focused on increasing both gross and net revenue retention

Employee Retention

Are you taking people into account?

Employee satisfaction will bleed into your customer base, for better or worse.

While exact statistics are always changing, roughly 3 in 10 sellers will leave your business each year.

While not all of this turnover is the result of dissatisfaction, paying attention to employee satisfaction can impact this number, helping you maintain knowledge and momentum.

All leaders need to identify solutions and best practices to improve upon these numbers.

Impact to discounting

Excessive discounting can be a major obstacle to achieving your sales goals.

What is discounting?

In B2B sales, the price you put on your website is almost always merely the first offer. Discounting percentages vary, but it is not uncommon for businesses to regularly discount their prices by 10-15% before volume discounts.

Want to increase your revenue attribution? Stop selling your solutions at a lower price point than targeted.

Quota Consistency

What is quota consistency?

This metric is the number of consecutive months during which a seller is achieving quota.

Research has shown that the Average Quota Achievement is 58% (per research from Xactly).

Annual Contract Value

What is ACV? ACV is short for annual contract value which can be used as an excellent measurement of business growth.

What is ACV?

ACV is the annualized amount of a customer’s contract with your company; minus any one-time payments included in the contract.

For example, if you sold a three-year, $380,000 contract to a new customer, which included a one-time payment of $20,000 to onboard and set up your business, you would calculate as:

(Total Value – One-Time Payment)/Contract Length in Years

or,

(380,000-20,000)/3 = $120,000

Ways to increase Annual Contract Value

There are a number of things you can do to increase your annual contract value.

  • Increase the number of one-time payments.
  • Include more services or products in your contracts.
  • Increase prices.
  • Upsell or cross-sell to customers.
  • Offer discounts for long-term contracts.

Trailing Growth

Trailing growth is an important metric for any Chief Revenue Officer to understand and grow.

What is Trailing Growth

This metric indicates how the business is performing based upon the last fixed set of months as compared to the same time period a year ago.

As with any growth predictor, it is not a perfect indicator, but it does provide a reasonable picture of your business today.

While not perfect, it is one of the more common KPIs used by investors to determine business potential and should be a number the Chief Revenue Officer is aware of in their regular tracking.

How to Calculate This Metric

What is trailing growth?As noted above, this metric essentially replaces the performance during a period of time in your last fiscal year with the current performance in your current fiscal year.  Let’s take a look at the trailing 6-month growth as an example, using revenue.

The assumptions for this example are:

  • We are currently at July 1st, 2021.
  • We are operating on a fiscal year the same as the calendar year.
  • From January 1st through June 30th of 2020, your revenue was $10M.
  • You ended your 2020 fiscal year with $25M in revenue.
  • From January 1st through June 30th of 2021, you have revenue of $17M.

To calculate the trailing 6-month growth:

(New Growth in Period – Growth in Prior Period) + Prior Period Revenue.

So,

($17M – $10M) + $25M

Trailing 6-Month growth in this example works out to $32M.

Growth Ceiling

The growth ceiling is the point at which recurring revenue, generally MRR, is at breakeven between new customers and customer churn.

In other words, you are only bringing in new business as fast as you are losing it.

You have choices as you approach this number:

  • Accept that your growth rate will begin decreasing as you approach 60-70% of the ceiling.
  • Invest more in marketing and sales outreach to increase the rate of new customer acquisition.
  • Reduce customer churn via customer success, product improvements, or other drivers leading to churn.

Time To Value

How long does it take to break even?

Time to Value, or TTV, is one of the most critical yet challenging metrics to wrap your arms around.

Why is Time to Value (TTV) difficult to grasp

How do you decrease Time to Value (TTV)For some products/solutions, value is easy to define; for others, it is not.

When your customer buys what you sell, they believe it can solve a problem, overcome a challenge, etc.

Let’s use an example.

You buy a SaaS solution that you believe will increase deal win rates by 5%.  

Simple enough, right?

Well, not really. Would value be achieved when win rates increase by 1% even though your expectations were 5%?

The point is simple. The buyer and seller must first agree on the definition of acceptable value for Time to Value (TTV) to occur.

And, what if a 5% bump in win rate occurred due to the CRO making a process change?

And, in a SaaS environment, you have time built into onboarding the customer and configuring the software — all of which delays the time to value realization.

Why do we care about this measurement?

Unless the customer achieves the value for which they bought your solution, they will not renew or continue to use your products.

Unless you are a trusted provider who has delivered value before, they will not buy more from you.

How can you decrease Time to Value (TTV)?

Our goal is to ensure every customer archives, recognizes, and connects your solution to value as quickly as possible.

Here are a few ideas to decrease your Time to Value:

  • Lockdown the definition of value during the sales process. Waiting until after the customer buys only delays this measurement.
  • Have a customer success team in place to streamline onboarding and setup.
  • Streamline the sales to customer success hand-off. Ensure your CS team knows what is expected, promised, and other critical details to avoid delaying value realization.
  • Use Quarterly Business Reviews (or the equivalent) to measure how you are doing against the value targets, make adjustments as necessary, and hit those targets.
  • Provide tips, best practices, and similar guides to the customer to educate and arm them to maximize the likelihood of success with your products.

Employee Referrals

Employee Referrals?

Most employees will refer their friends and/or old coworkers for open positions at your company if they are happy and excited about the business. Are your employees demonstrating this passion for your business?

Unsure if employee referrals are worth worrying about?

This research from Zippia should convince you to focus your attention here:

  • Employee referrals account for 30-40% of all hires.
  • Referrals remain employees 70% longer than all others.
  • Referred employees are, on average, 25% more profitable than other forms of hiring.

And this stat from Apolla Technical, that “a candidate who is invited for an interview has a 40% higher probability of being recruited than other prospective employees”, is incredible, demonstrating the importance of this sourcing method.

Net Profit Margin

The net profit margin is the percentage of revenue that a business keeps after all expenses are paid.

Business metrics like net profit margin and net profit overall, are critical financial metrics.

Gross profit margin

The gross profit margin is the percentage of revenue that a business keeps after paying for the cost of goods sold.

Both net profit margin and gross profit margin are important business metrics and indicators of business health.

Customer Acquisition Cost

What is customer acquisition cost (CAC)?

Customer acquisition cost is the total amount of money spent in order to acquire a new customer.

CAC can be divided into three categories: sales and marketing expenses, customer service expenses, and other acquisition costs.

The cost of customer acquisition is a wonderful indicator of the scalability of your go-to-market efforts.

Net promoter score

What is a Net Promoter Score (NPS)?

A Net Promoter Score is a measure of how likely a customer is to recommend your business to others.

NPS can range from -100 (everyone is a detractor) to +100 (everyone is a promoter).

While not everyone agrees, NPS provides a good indication of customer satisfaction.

Cash Flow

What is cash flow?

Cash flow is the movement of money in and out of a business.

Out of all the business metrics, this one is critical for ensuring you can pay your bills and meet payroll.

Time to Productivity

Productivity SHOULD be a defined set of skills or competencies that new hires can demonstrate before they begin their customer-facing duties.

Average Revenue per Unit (AR)

The average revenue per unit is the total revenue earned from all sales in a given time divided by the total number of units sold in that same time.

As a simple example.

If you sell ten units of your product for $100,000, your AR is ($100,000/10), or $10,000 AR per unit.

Marginal Revenue per Unit (MR)

Marginal revenue is the difference in revenue from the previous AR due to selling more units.

Let’s use the same basic example as above, where we sold ten units of your product for $100,000 with AR of $10,000 per unit.

If we sell ten more units and have a total revenue of $110,000, we would calculate the additional revenue divided by the additional units sold. In this case, we earned an extra $10,000 by selling the other ten units for a marginal gain of ($10,000/10) or $1,000 in MR.

Customer lifetime value

The customer lifetime value is almost the same as the total revenue. Only lifetime value considers the cost to the business of earning that revenue.

Let’s go back to our original example where we sold ten units of your product for $100,000 with average revenue (AR) of $10,000 per unit.

Only, let’s also recognize that it cost us $20,000 to sell those ten units.

So, total revenue is $100,000, AR per Unit is $10,000, and lifetime value is the total revenue, minus the total cost to earn the revenue, divided by the number of units, or:

($100,000 – $20,000)/10

–which works out to a customer lifetime value of $8,000 versus the AR per unit of $10,000.

Lagging indicators and slow deal cycles?

When deal cycles are slow, it can be challenging to determine how your work is impacting sales metrics and other business metrics.

For example, if a typical deal cycle is 12 months, you cannot afford to hope that they will start closing deals at some distant point in the future.

What can you do?

In partnership and collaboration with sales leaders, marketing, operations, customer success, and whoever is appropriate in your organization, define the expected timing and frequency for specific activities you can measure. For example, should a new seller be making a certain number of calls consistently within a certain number of weeks? Should they be working on a certain number of opportunities in some number of months?

While none of these measures are perfect, and the impact on leading indicators is mostly correlation, you need to tie your Enablement efforts to them. When correlation is clarified, these indicators help your business partners understand how what you are doing is expected to impact the business.

And please, remember Goodhart’s Law as you consider the Sales Enablement KPIs you will be using to navigate the seas of Enablement.

Beyond data-driven business metrics

The business metrics you use will provide you with hard data. You need to dig deeper, to learn what is happening in your business, with your customers, and partners.

One example for sales teams is the win-loss analysis. Read our in-depth article on win-loss analysis to learn more.

Final thoughts on business metrics

As we already discussed, there are dozens if not hundreds of business metrics you could possibly use to measure your performance. We have covered the business metrics we feel are most common.

However, we are also certain we have missed many important ones as well, so please leave a comment and we will add more.

What is sales forecast accuracy?

Sales forecast accuracy is an excellent gauge of your leadership’s maturity and its ability to meet its sales commitments across a given time.

What is content marketing ROI?

Content marketing ROI is, as the name implies, the ratio of sales attributable to marketing-created content vs. the cost of creating that content.

What is sales efficiency?

Sales Efficiency (Net, Gross, and Otherwise) is an important metric that demonstrates the incremental revenue you earn against what you invest in sales and marketing.

What is sales productivity?

Sales Productivity is the average amount of new revenue per seller for a given period of time.

What is deal velocity?

Deal velocity (sometimes called sales cycle length) in this example is merely the average number of days/months it takes an average deal to move from the beginning of the sales funnel to the end with a closed/won or close/lost decision.

What is quota consistency?

This metric is the number of consecutive months during which a seller is achieving a quota.

How do you calculate ROI?

Divide the amount gained by the original value. Let’s use an example. If you invest $1,525,000 in a business and earn a return of $775,000, what is your ROI? You take (775000/1525000) and come up with a number of approximately 0.508. Convert this into a percentage by multiplying by 100 and your ROI would be 50.8%, rounded up to 51%.

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