Here are five of the most common and important KPIs for fuel and oil marketers to track.
By John J. Kimmel
By the time actual sales figures are tallied, it’s too late to do anything about them. For most organizations, monitoring salespeople means looking at the sales number for the period that just ended, whether that was the year, quarter or month, and then telling them they need to do better. At the same time, the sales manager’s boss is asking the sales manager what happened and if the numbers will increase. Of course, the sales manager assures the boss that the numbers will get better but is secretly hoping not to hear the dreaded question: How do you know if sales will increase?
That is the million-dollar question, and the answer is KPIs, or key performance indicators. KPIs are activities that need to happen before the sale is made, and tracking these activities can give managers powerful insight into whether their salespeople are on track to hit their numbers—or not. Here is a list of some of the most common and important KPIs for fuel and oil marketers to track. This list is by no means exhaustive, and some will vary based on the sales team’s structure. It also assumes teams have both inside and outside salespeople.
- Outbound Attempts to Contact. How many calls are your salespeople making per day? This can include face-to-face visits, Zoom calls, phone calls, emails, texts and even social media messages. One thing you can be sure of is that your salespeople can make more calls than they are making now. How can I say that? Because in my entire career, I have never trained anyone who could not be a better steward of their time and increase their number of calls. Not once. There is simple math at play here. My friend Skip Miller gave us the formula: R=FxC. That is, revenue equals frequency times competency. Competency means getting better at how we preform our sales activity. Frequency is how many times we do it. If we make more calls (increasing our frequency), then our revenue produced will increase as well.
I highly suggest that these calls get recorded in a CRM. They need to be recorded somehow, and recording them by hand is ineffective and takes just as long as recording them in customer relationship management software, which can help us achieve so much more than we will discuss today.
- Actual Conversations. You would think this goes without saying, but very few organizations or salespeople track how many of their attempts to contact result in a conversation. This data goes hand in hand with outbound attempts to contact. Imagine salesperson one makes 60 calls and has three conversations, while salesperson two makes 10 calls and has three conversations. Who is performing at a higher level? The answer could be neither. Salesperson one may have a competency issue because his conversation success rate is so low. Salesperson two may have a frequency issue since she only made 10 calls. The more salespeople you have, the more accurate and relevant this information will be. For those with small or one-person sales teams, having someone who can tell you industry standards for sales activities will fill this gap.
- Sales Stage Movements. Every customer that encounters your organization goes on a journey. If that journey is poor, they most likely will buy from your competitor. If that journey is good, they will likely buy from you. If that journey is great, they will become a fan of your organization and will not only buy from you, but they will keep buying from you and even refer others to you. That customer journey is defined in the sales process your company uses and is broken into stages like rapport and discovery. If this is all Greek to you, then you have a huge opportunity here to not just track sales stage movement, but to improve your sales efforts immensely by adding a true sales process to your sales program.
- Lead to Close Rate. For an inside salesperson, this likely involves an inbound lead. In other words, a potential new customer contacted your company. That may be through a form filled out on your website or a phone call to your office. Either way, you have a new sales opportunity. For an outside salesperson, this could be a cold call on a new business or a referral. However it occurs, you have a new lead to sell. “Close” is the last stage of the core sales process (customer journey) we discussed previously. Its name is self-explanatory; it occurs when the transaction is complete. For some that may mean giving you payment, for others it may mean signing a contract for delivery. Either way, the deal is done.
How are each of your salespeople’s conversion rates from lead to close? Do they close 90% of their leads? Do they close 10% of their leads? If you are like most companies, you don’t yet have that information. Improving this metric can have a huge impact on your bottom line.
- Number of Active Customers and Average Sales per Active Customer. OK, so this is really two separate metrics, but they are tied together. If you can see the number of customers that buy something from you each month it will give you tremendous insight into who your salespeople are talking to each month. People buy from those that they like and trust, and that is true for your customers as well. If one of your salespeople has 20 active customers per month and another has 50, then I can almost guarantee that the second salesperson is making more sales calls to unique people than the first. They may both make the same number of total visits, but the second is seeing a higher number of customers, fewer times per customer, than the first.
The second part of this category is average sales per active customer. This has to do with wallet-share. Almost every petroleum marketer I know has more than one product to sell. Some have many. When a salesperson captures the business on more than one product, their sales per account will increase. Of course, they can also capture more of the total volume of a single product and increase this number as well. A great salesperson fights for both. Watching these numbers can be a great indicator as to what specific training would most improve your sales team and their productivity.
As with all monitoring that relates to achieving goals, the simpler the system the more effective. I could list another 20 things you could track, but if you try to track too many things, you are likely to lose track of everything. My suggestion is that you pick three things to focus on first. Once those three things are improving you can increase it to as high as five. If you feel like you have a handle on an item, then stop tracking it (or automate tracking, like with a CRM) and add a new metric. The more you refine this process, the higher the sales production will be from your team.
John J. Kimmel is the author of “Selling with Power” and has spoken for many state and regional petroleum marketer associations. Kimmel provides custom solutions to increase the effectiveness and profitability of sales teams for petroleum marketers all over the United States. To learn more, visit www.johnjkimmel.com.