A sales pipeline is a visual representation of the different stages of the sales process in a CRM. Every business has a unique approach to its sales process. Hence, every sales pipeline can be unique in nature.
Basically, It’s the journey of MQLs from the moment they’re prospects, till they turn into customers.
It is a summary of all available and upcoming sales opportunities for any company.
If you’d like to learn more about it in-depth, we’ve created a detailed guide on sales pipeline.
- How to build a solid sales pipeline? [with stages]
- What is sales pipeline management?
- Significance of sales pipeline management
- Best practices to manage your sales pipeline effectively
- Sales pipeline management metrics
- Free sales pipeline management template
- Best sales pipeline management software
- How to easily manage multiple sales pipelines with Salesmate?
How to build a solid sales pipeline? [with stages]
Okay, now that you know a little about sales pipelines, the next question is how do you build a solid one for your business?
It is absolutely vital to understand the process of creating a pipeline in order to yield maximum results.
In order to target the right prospect and convert them into a customer, sales reps have to go through various sales pipeline stages.
- Setting Appointments
- Handle Sales Objections
To have a sneak peek at the above stages, you can check out our detailed article.
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What is sales pipeline management?
Sales pipeline management is the process of managing new and existing sales opportunities and tracking them across various stages of the sales pipeline.
Although, it is not just about opportunity management, but also about effectively managing multiple pipelines.
A business can have multiple pipelines for its products or services. And sales pipeline management is the practice of handling them in the most efficient way possible!
It counts overall activities from not only the usual stages but also doing the right things throughout the year to help your sales reps and organization to achieve their revenue goals.
It is always suggested to have the right sales pipeline management software for efficiently managing your pipelines.
Such tools can help you clearly define your sales process, get crucial insights, and automate manual tasks.
More on that later.
Significance of sales pipeline management
After understanding the terms of sales pipeline management. Here are certain pointers on why practicing sales pipeline management can help you take your sales and business to the next level.
1. Increased sales conversion rate and growth
According to Harvard Business Review, companies with sorted sales pipeline management saw 28% growth compared to the ones that didn’t.
When you optimize every stage of the sales pipeline, you’re working on the highest-performing model for your business. And this ensures more deal closure and a higher percentage of growth.
This would include proper tracking of prospects, taking regular follow-ups, choosing effective communication channels, and having the best negotiation tactics.
Proper prospect tracking lets you identify the most valued leads from your collection.
An effective follow-up process would help you in building long-term relationships and increased sales closure.
Choosing the right communication will speed up your sales process by folds.
And the right negotiation tactics will onboard the best-fit customers in your company at the best profit.
While optimizing sales pipelines, you‘ll experience meeting your set targets and achieving more!
2. Forecast business results
Efficient sales pipeline management is all about maximizing sales with the available resources.
A competent CRM is all you need to do the same. It lets you track your pipelines from a worm’s eye view.
When you are keeping track of your prospects and their stages, you already know your next steps. That means you know when and how to follow up in order to turn the prospect into a customer.
Similarly, you also know which prospect has less or no chance of turning into your customer.
3. Measure your target accomplishment gap
You are very well aware of the term target. It is an inseparable part of the sales process.
Achieving the set target is not always as easy as it seems. But with proper sales pipeline management, you can make this difficult task very easy.
For example, if you have a list of 10 prospects and you need 4 more deal closures in order to achieve the set target. You can refer to the prospects list and follow up with the most relevant ones in order to convert them.
Hence, sales pipeline management works like a ticking clock. It helps you know your achieved number and the difference between the set target.
This way proper sales pipeline management helps you measure your target accomplishment gap.
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4. Analyze different sales strategies for your business
Sales is a dynamic field. The pitches, mailers, and texts are subjective at a certain point of customer interaction.
While tracking your prospects with the help of sales pipeline management, you’ll come across your prospects at various stages.
And while you’re following up with these prospects you may use some new strategies or modify the existing one.
Likewise, you can rank the strategy that yields the highest to least conversion of your sales.
Thus, it concludes that you can analyze different sales strategies for your business while practicing sales pipeline management.
Best practices to manage your sales pipeline effectively
Moving further, these below points will help you to practice sales pipeline management in their most efficient way.
1. Automate your entire sales playbook
Imagine having 50 prospects at different stages in your pipeline to be reached in a single day. Now, each of these prospects needs to be touched on in a different form of communication.
For example, you may have to call certain prospects, send mailers to some, and chat with the remaining ones via texts.
Now, manually working on this is a lot of work which comes with the possibility of loopholes.
A CRM that automates all these processes brings so much relief and value addition to your work.
CRM works as your personal secretary here to remind, send sales emails, and remind you to make calls to your prospects.
With the help of sales cadences, you can automate your sales follow-ups. Your sales reps don’t have to manually send emails ever.
All they have to do is create a cadence (a.k.a. Sequence) as per their conditions, and the engine will be in motion.
Talking about automation, you can also create your own playbook, and remove maximum manual dependencies. You can achieve this via journey-based automation. At Salesmate, we call it Automation Journeys.
Remind you that, a third of all sales activities can be automated. This simply means more time for selling to your sales reps and a much simpler sales process for your business.
2. Review pipelines frequently
The pipeline management process involves a lot of stages.
Apart from following the process, one of the best practices you can perform is reviewing your pipelines frequently.
This practice ensures there is no backlog of deals at any particular stage and you can reach your sales quota with much fewer efforts. Here are some ways pipeline reviews can help and you should perform them at least once a month:
- Find where deals are clogging. More deals at a particular stage mean there is a problem in your process. For example, if the clog is in the “Presentation” stage and fewer deals are moving to “Negotiation”, either your presentations need serious improvements or you need to hire more people.
- Investigate how much time each stage takes in your sales process. This would help you what exactly is slowing you down.
- Identify the sales performance as a team and individually. This directly leads you to people who need recognition or training.
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3. Effectively define criteria for every stage of your sales pipeline
Your prospects go through various stages in the sales cycle process in order to turn into your customer.
Your actions vary from one stage to another. For example, your actions while you are qualifying the leads and your actions while you are following up with your prospect are totally different.
Similarly, every prospect is different when it comes to turning into a customer. While practicing pipeline management, you need to set criteria and certain qualifications to identify the potentiality of your prospect.
This way you can categorize your prospect and identify which ones will turn into your customer and which one can be re-approached in the coming quarter.
This lead scoring process helps you to not only achieve the leads but also ensure that you don’t miss any of your potential prospects.
The simplest way is to adopt lead scoring and your sales pipeline CRM can help you with that as well. In lead scoring, entire progress is divided into small steps, and every step has a unique score.
For instance, lead replies to your cold email. That’s a big one! I’d give it 20 points.
If the lead picks up the phone and confirms the meeting, I’d give 30 points.
You see, at any given time, your sales team would know which prospects need more attention from the ocean.
4. Choosing relevant metrics
With proper practice of sales pipeline management metrics, you can keep an account of all your pipelines.
These metrics basically give you figures that are needed to track your performance and improvise your sales pipeline growth.
Sales pipeline management metrics
Here are some of the sales pipeline metrics proven to be helpful for growing businesses.
1. Sales cycle length
The sales cycle length is the time required to close a sale and is calculated as:
The total number of days to close the deal / Total number of deals closed
Considering the above formula, we conclude that a sales cycle is subjective depending upon the industry and sector.
It is also useful if you’re planning to shorten your sales cycle.
Moreover, you can even measure the efficiency of your team using this metric as it lets you track their task and figure out where the team is investing time in unproductive tasks.
2. Average deal size
Every organization has a bunch of services to offer, this brings various pricing structures into the picture.
Every prospect on your list will not have the same requirement.
So, this metric helps us know the average deal price. This is calculated as:
Total revenue for a set period/ number of deals won in the set period
For instance, if your annual sales revenue is $500,000 and you’ve closed 28 deals this year. Your average deal size is about $18k.
This metric is very important to target your ideal customer and identify the real value of your product or service.
3. Customer Lifetime Value
This metric is quite useful, especially in the SaaS model.
It is calculated as, Customer Value * Average Customer Lifespan
Where Customer Value is, Average frequency of purchase *Average purchase value.
Average Customer Lifespan is the average purchases made by a customer for a set time.
If you believe in maintaining a long-term relationship with your customers then this is the metric to practice.
It helps in projecting future revenues from existing clients. Also, it helps in maintaining a fixed customer base in the market.
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4. Conversion rate
While practicing sales pipeline management you often want to know the conversion rate.
This metric helps to keep track of the prospects that turned into your customers.
Conversion rate is basically the prospects turned into your customer divided by the prospect list you have.
For example, if you had a prospect list of 100. Out of which, 20 turned into customers. So, your conversion rate is 20%.
The conversion rate defines the efficiency of your process and it also shows the areas you need to improve.
Curious to learn more about such metrics? We’ve created a dedicated article on this subject. Check out our detailed blog on the 11 most important sales pipeline metrics.
Free sales pipeline management template
After learning in-depth about the significance and best practices of pipeline management, you would definitely want to try one for your business.
So here’s a sales pipeline template for you, completely free.
This Excel template will help you with the following things:
- Track your deals
- Plan your sales Activities
- Customize it as per your needs
- Create deal reports
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Best sales pipeline management software
If you want to check out their features in-depth comparison with Salesmate, please follow this link.
How to easily manage multiple sales pipelines with Salesmate?
Salesmate is CRM and Unified Customer Platform to bring your sales, marketing, and customer experience teams under the same roof and create a single source of truth for data.
One of the strongest features Salesmate provides is pipeline management. You can easily create the pipeline of your style. You can modify the stages and rename them as per your needs.
Once you set out your first pipeline, you can start creating deals inside Salesmate. The interface is super simple. You can drag-and-drop deals between stages and get a bigger picture of your sales.
But one pipeline is not enough.
That’s why you can create unlimited pipelines in Salesmate. Replicate the existing ones or create new, as many as you need!
The best part of Salesmate lies in the automation capabilities.
First of all, you can set pipeline automations using Workflows. Simple tasks like:
- If a deal is moved from one stage to another, an activity will be assigned to a specific sales rep.
- Take a certain action if a specific condition matches.
You can automate mundane tasks using Workflows. But if you want to take it to the next stage, Salesmate has got Sequences & Journey-based Automation.
Sequences, also known as sales cadence, can help you automate your entire follow-up system. You can send personalized emails and texts automatically and once the prospects respond, they’ll be removed from the Sequence.
It is super-useful for any sales rep and can save tons of valuable time for selling.
Journey-based Automation is based on actions, triggers, and conditions. You can practically automate your entire playbook or create a personalized lead scoring mechanism.
Besides these, Salesmate comes with a bouquet of features such as:
- Contact Management
- Built-in Calling
- Text Messaging
- Marketing Automation
- Team Inbox
- Live Chat & Chat Journeys
- Web Forms
- Meeting Scheduler
- Super-intuitive mobile apps for iOS & Android
Want to try your hand at Salesmate? Take a 15-days FREE trial and explore every corner of Salesmate. If you love it, as I do, you can start at just $12/user/month.