Key performance indicators (KPIs) are measurable values that help companies understand how well they are performing toward business goals. They provide a way to track and assess progress, but there’s a catch. KPIs are only effective if you are paying attention to the right ones and using them to make data-driven decisions that improve the performance of your organization.
“I don’t need KP-whatevers. I know I’m busy when my phone’s ringing.”
Sound familiar? It’s an old-school way of measuring the success of business development and customer growth. While inbound phone calls are one way to measure the effectiveness of your advertising and marketing, it’s not good for measuring your sales team's efficiency or how much it costs you to acquire a sale. In this post, we’ll list 20 KPIs that sales teams in commercial real estate can use as they reach out to new customers.
Successful sales development reps and marketing teams watch a variety of KPIs so they can:
Measure success, growth, and failures to improve performance
Keep SDRs (sales development reps) aligned with business goals
Improve accountability and motivation
Make better business decisions
Create a culture of continuous improvement
The impact of SDRs working in the commercial real estate industry can be measured with a mix of general and CRE-specific KPIs. While your organization will want to select KPIs directly related to your business goals, the following list offers a starting point for determining for tracking business development and sales development performance in a CRE environment.
7 CRE Specific KPIs
The following KPIs are particularly helpful for evaluating business development in and around the commercial real estate industry. Your organization may have additional or different needs depending on your services, offerings, and goals.
Property tours scheduled: For a property manager, leasing agent or real estate broker, this KPI tracks the number of scheduled property tours or site visits. It can indicate how successful the team members are at engaging prospects and generating interest for the various properties being marketed. In addition to scheduled tours, this team should track the number of completed property tours.
Open rates for email: If you use email marketing automation, the platform you use (Mailchimp, Constant Contact, Hubspot, ActiveCampaign for example), will provide a report that measures how many emails are opened and clicked. The best platforms allow you to drill down and see even more KPIs, like forwards. These are good signals of interest in your services or products.
Lead-to-opportunity conversion rate: This KPI measures the percentage of leads generated by the SDR that convert into official opportunities. It helps evaluate their ability to appropriately qualify leads and move those leads through the sales pipeline. In our property tour example, the LTO could be the number or percentage of tour schedulers who become tour takers.
Database growth: This KPI indicates how effective SDRs are at identifying opportunities and expanding the organization's property database. It tracks how many new properties are added to the database based on the SDRs’ individual research and lead generation efforts.
Qualified property opportunities: This KPI measures the number of qualified property opportunities identified and generated by the SDR. This can help indicate how effective they are at identifying properties that align with your organization's target market and basic requirements.
Revenue generated: This KPI tracks the actual dollar value of deals closed as a result of the effort of SDRs. This metric helps to assess the SDR's impact on the organization's bottom line.
Response and engagement rate: This KPI measures the SDRs’ success in generating responses and engagement from prospects. Measuring response and engagement usually requires looking at a combination of metrics, such as the volume of email replies, follow-up phone calls with previously engaged leads, and similar statistics.
9 KPIs for Sales Rep Benchmarks
General KPIs can also be helpful to track, especially for companies that are not directly involved in developing real estate. This includes companies that offer services to CRE organizations, such as building suppliers or service companies that want to work with property management firms.
Average deal size or value: This KPI measures the average dollar value of closed deals. It can help provide insight into how much actual revenue is generated per transaction. Over time, it helps you measure how much SDRs contribute to business growth and trends in deal size.
Monthly/quarterly sales targets: This KPI sets specific numerical goals for sales performance within a defined period. This can act as a benchmark to determine your SDRs progress over the course of the year and help keep revenue growth on track.
Percentage of lost deals and reasons for loss: This KPI tracks the proportion of deals that did not close. To be an effective metric, you’ll also need to track the underlying reasons for the deal not closing. That means you’ll need to develop a standardized code system so you can quantify rejections. This allows you to identify areas of improvement in the sales process and customer engagement strategies.
Average response time to inbound leads: This KPI measures the average duration it takes for SDRs to respond to inquiries or leads received. The better the response time, the more likely you are to move the lead forward. This metric offers insight into the team's efficiency and can help improve lead conversion rates.
Number of outbound calls made per day/week/month: This KPI quantifies the volume of proactive outbound calls made within a specific time frame. It acts as a general measure of SDRs activity level and the outreach efforts they undertake to generate new leads and opportunities.
Number of appointments or calls scheduled: This KPI tracks how many meetings or appointments are set up with potential clients. It can reflect how effective SDRs are at moving leads through the sales pipeline. This KPI is more effective at evaluating the effectiveness of the SDR when considered in relation to the number of calls being made.
Number of meetings kept: This KPI measures the actual number of meetings held with potential clients. It indicates the SDR’s level of effort and ability to effectively discuss your company’s offerings. This KPI is more effective at evaluating the effectiveness of the SDR when considered in relation to the number of calls made and appointments or meetings set.
Customer satisfaction or net promoter score (NPS): This KPI gauges the satisfaction and loyalty of your existing or former customers in terms of how likely they are to recommend you to their peers. NPS is generated by collecting feedback and ratings through a simple survey. NPS offers a general measure of customer sentiment, which is an indicator of how likely they are to use and recommend your company to others.
Number of proposals generated: This KPI measures the quantity of proposals submitted within a specific timeframe. It can indicate the activity level of an SDR, along with their ability to engage and move leads down the pipeline. This KPI is more effective at evaluating success when it is considered in relation to the number of calls made, meetings set, and leads closed.
4 Other Important Sales KPIs
Additionally, these are some of the most common SDR/BDR KPIs:
Time-bound sales growth: Monthly, quarterly, annually and year-over-year sales growth (or decline) in terms of dollars, units and net sales.
Average conversion time: The time it takes for a prospect to become a lead and a lead to become a customer.
Customer acquisition cost: How much did it cost your company to acquire a lead? This factor takes into account marketing and advertising spend, SDR time spent on calls, and resources used.
Average purchase value: This KPI takes the total purchases over a specific time and divides it by the number of customers to arrive at the average purchase value. With this, you can measure month over month changes, as well as how individual SDRs compare to the team average.
Effective use of KPIs can help your organization paint a realistic picture of how effective your SDR team is at finding, engaging, and converting leads. KPIs are also critical in finding areas that need improvement, making better decisions, and aligning sales efforts with business goals. Just remember, you’ll need to evaluate your sales process, target market and specific goals before deciding which KPIs matter the most for you.
Comments