Best Practices for Managing Your Sales Pipeline
What Is Sales Pipeline Management?
When it comes to ensuring your deals are managed effectively, the importance of a well-managed sales pipeline cannot be overstated.
A sales pipeline is a visualization of your sales process. It helps guide sales team members during their sales activities by providing an overview of the number of deals you have in progress and where sales prospects are in the overall process.
Sales pipeline management helps facilitate this.
Pipeline management aims to find ways to improve the pipeline and support salespeople as they convert leads into new customers. Management asks questions and generates solutions to optimize the pipeline so that prospects enter the sales process and flow through it efficiently.
According to the Harvard Business Review, companies that have refined their pipelines increased their revenue by 28%. Meanwhile, companies with ineffective pipeline management reported a lower growth rate, suggesting that inadequate sales pipeline management poses a substantial risk to sales practices.
To help you build a healthy sales pipeline, we’ll be looking at the sales pipeline and best practices for managing it.
Sales Pipeline vs. Sales Funnel
(Source)
Although often used interchangeably, the sales pipeline and the sales funnel do not represent the same information.
Usually visualized as a horizontal bar, the sales pipeline illustrates the sales process. A more complex visualization (such as one featured on a CRM dashboard) may chart the exact number of deals in progress and actions needed to move a deal to the next stage.
Meanwhile, the sales funnel depicts the buying process. It’s visualized as a funnel because of the disproportionate number of new leads entering the rates and the conversion rates of qualified leads and new customers.
Many prospects enter, but as they progress through the buying process, the funnel inevitably narrows as salespeople move on from leads and prospects choose not to buy.
Sales Pipeline Stages in the B2B Sales Process
The sales process is a set of standardized practices for turning a lead into a customer, divided into pipeline stages.
We’ve gone in-depth about sales prospecting techniques in another guide, so here’s a condensed look at what a company’s pipeline stages may look like in their B2B sales process:
Lead Generation
Early into the pipeline, salespeople focus on discovering potential customers. They may use tools such as Owler Max to research prospects and construct marketing campaigns to generate new leads. Less surefire methods might include asking current customers for referrals.
Lead Qualification
Following the discovery of prospects, salespeople must qualify leads. A sales qualified lead is a business or person who fits a sales team’s ideal customer profile.
Lead qualification is an essential stage. It helps sales teams prioritize leads with potential and identify prospects unlikely to buy early on, saving time and energy better spent elsewhere in the pipeline.
Make Contact
At this pipeline stage, a salesperson is ready to initiate contact, learn more about a prospect’s needs, and gauge deal size. To foster a good relationship, this is typically a multi-step process.
For example, sales opportunities with contacts may begin with cold calling and later evolve into setting up a meeting with a decision-maker. Subsequent follow-ups will help salespeople decide whether to continue pursuing the deal or not.
Close Deal
This is the end stage of your pipeline, where a salesperson transitions out of negotiations and begins to close a deal.
How quickly this process goes and whether the buyer requires further deliberation differs with every prospect. Amongst other factors, the time taken to close helps determine your pipeline’s sales velocity and sales cycle length.
Sales Pipeline Management Best Practices
Pipeline management encourages sales leaders to examine their sales strategies, identify problem areas, and ask in-depth questions.
For example, why do some deals fall through where others succeed? What can be done to expedite stagnant deals or resolve poor follow-up more effectively?
By answering questions such as these, sales teams can apply realistic solutions and improve the efficiency of their pipeline wherever possible to reach their ideal sales cycle.
To help you get started, here are four best practices to help you improve your sales pipeline management:
Streamline your sales pipeline stages
A healthy sales pipeline design isn’t just full of new leads. Instead, it’s structured to support salespeople and improve performance as they manage multiple deals at once.
To determine how well your pipeline flows, evaluate the design itself. Sales processes differ from industry to industry, so consider how your current strategy reflects your enterprise. Take into consideration how this compares to the typical sales process workflow your salespeople may be familiar with and whether current practices are efficient.
Ensure there is a logical process to these stages and remove any chance of misinterpretation by standardizing practices across your sales cycle.
Clean up your CRM
(Source)
For smoother pipeline management, consider using CRM tools.
By integrating a sales CRM platform such as Salesforce into your current methodology, you can eliminate time-intensive tasks with automation tools and carry out activities with a direct overview of your pipeline, visualized by your CRM dashboard (as seen above.)
With some CRM platforms, you can determine your sales cycle length thanks to a broad overview of your sales performance and active deals in the pipeline. You may also be able to view additional metrics for more specific sales activities.
Use templates for quicker workflow
(Source)
While standardizing your sales process, consider implementing templates for pipeline reports.
Pipeline reports allow you to measure sales metrics and track the performance of deals as they move through the pipeline.
CRM tools like Salesforce automates pipeline reporting so you can assess data trends faster and evaluate current performance against historical values.
Alternatively, you can craft your own templates in Excel. As you do so, create small, trackable tasks that are easy to follow and input data for quick assessment.
Train salespeople to understand your metrics
61% of executives confessed their sales managers are not adequately trained for pipeline management. Meanwhile, companies that trained their sales managers witnessed their revenue grow 9% faster.
By emphasizing targeted training, your sales team can equip themselves with the information needed to address specific challenges and improve pipeline efficiency. Consider using your sales pipeline metrics as guideposts for growth as you train your team.
These metrics include:
Number of deals in motion: A large pipeline with many leads will strain your team. Meanwhile, a pipeline that prioritizes quality over quantity limits overreach and encourages salespeople to focus on high-value prospects.
Deal size: Define the average deal size of your pipeline to help salespeople organize and identify promising opportunities. Deals of higher value than your typical deal size should be flagged and prioritized ahead of low-risk leads.
Closed deals ratio: Compare the percentage of business closed and your win rate against your pipeline’s performance. This data can help you identify where your salespeople are losing opportunities and what skills they need to improve (rapport building, managing objections, closing skills, etc.)
Sales velocity: The time it takes to close a deal reveals a lot about the health of your pipeline. Leverage this metric to evaluate your team’s performance and how it may be affecting your sales cycle length.
Speed Up Your Sales Pipeline with Owler
Your sales pipeline helps guide your sales process. However, without appropriate management, your sales team may lack the insight needed to manage deals effectively.
Owler helps patch information gaps by supplying your pipeline with comprehensive, real-time sales intelligence.
By taking advantage of our rich network of 14 million public and private businesses, Owler Max simplifies information gathering and sales prospecting during the early stages of the pipeline. Armed with research-backed, data-powered intel on your best-fit prospects, you and your team can go on to focus on sealing the remaining gaps in your pipeline and optimizing your sales process.
To learn more, check out our book a demo or contact us to discover how we can help your pipeline stay informed.