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Strip your Sales - measure Sales Velocity to grow your business

Measuring quarterly revenue alone is not going to help you determine which areas to focus on to make your Sales team more successful.

Pontus Kronvall / March 28, 2018

Improving your Sales efficiency is not easy. Especially, if you do not have a clear view why the money is not coming in. Measuring quarterly revenue alone is not going to help you determine which areas to focus on to make your Sales team more successful.

To help you out there is a measurement called Sales Velocity. An equation that shows, how fast are qualified leads turning into closed opportunities.

How does Sales Velocity influence your revenue?

Sales revenue can be broken down into four components: a number of opportunities in your pipeline, average opportunity amount, win rate ­– what percentage of opportunities are you winning and an average sales cycle length. For measuring Sales Velocity, we need to connect the value of each component into one single formula.

Formula Sales Velocity = Number of Opportunities x Opportunity Value x Win Ratio / Sales Cycle Length

Measuring Sales Velocity bring value to your sales strategy if you focus on trend analysis rather than just a single result.

More opportunities do not always equal more money!

An easy approach to increase your sales is to add more opportunities to your pipeline, but that may not be the most efficient way of increasing your result. Sales Velocity gives you a way of identifying where the lowest hanging fruits are. It enables you to ask correct questions and act to improve the numbers in relevant areas.

Are you having too few opportunities? Maybe invest more in marketing and awareness events. Work on improving your process of lead capturing and qualification.

Do you want to increase your average opportunity amount? How about setting up a CPQ-tool to better tailor your offer to customers. Try to sell with value adding extras, instead of offering discounts.

Is your win rate too low? Make sure your sales process streamlined, and you have an effective management of the opportunity pipeline. Invest in collaboration tools and training of your workforce.

Do you have too long sales cycle? Work on your pipeline management and sales force automation. Look at how long it takes to lose a deal and decide if you need to improve your ability to identify failing deals in earlier stages. You can also use the sales cycle metric to choose which opportunities to ignore. The large deals with a long sales cycle might not worth going after.

Cracking the nut

The metrics do of course have some dependency to one another. Increasing the number of opportunities could lower your win rate and so forth. Therefore, you should work continuously to improve your Sales Velocity.

Getting a relevant toolbox is a good way to start. At Tieto Salesforce Team we can help you to understand, how the Sales Velocity analysis would work the best for your organization. We can build customized analytic solutions on the Salesforce platform and advice you on actions that can rapidly improve your sales results.

Pontus Kronvall
Lead Salesforce Consultant, Tieto

Pontus joined Tieto in 2017 as a senior Salesforce Consultant in Cloud Born Enterprise Applications team. He is thrilled about working with the big building blocks of Salesforce cloud technology and fascinated, how it can be quickly modified to cater to the business needs. He is motivated when he and his team get a perfect end-to-end solution, that really makes customers process flow smoothly.


Pontus Kronvall

Lead Salesforce Consultant, Tieto

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