In today’s challenging economic climate, many industries are experiencing a downturn in sales. However, there is a straightforward strategy that can help not only stabilize but also boost your sales figures. This method might seem obvious, but it’s surprising how many professionals overlook its simplicity: sales are a formula.
Throughout my career, the businesses I’ve managed have consistently hit their sales targets, regardless of market conditions. My wife and I own a hospitality business that thrived during COVID-19, a period when many others in our industry struggled. The secret? A relentless focus on the formula: Leads x Conversion = Sales.
Leads x Conversion = Sales
Many sales professionals receive their targets and then continue to operate at the same pace, expecting different results. This is a mistake. Over the past few years, businesses have faced significant volatility in sales performance. Despite this, the key to success has remained unchanged: focus obsessively on your key performance indicators (KPIs)—leads and conversions.
During prosperous times, when leads are abundant, I coach my sales team to focus on conversion rates. Conversion should be monitored daily. There is no reason to accept lower close ratios, as this can create a downward spiral that is difficult to recover from.
Two Variables: Leads and Conversion
These are the only two variables that can impact sales. Here’s how I have grown my business year over year without fail, using a simple approach: visualize these two variables as sliding targets and monitor them daily. I ensure a specific number of leads are generated based on current and target conversion rates. If leads drop, increase effort—send more messages, increase exposure, build relationships, and focus on referrals. Never let the number of leads slip.
However, if leads are down, many people convince themselves the market is poor and start to spiral. At this point, your only option is to increase conversion. This involves evaluating your value proposition, increasing urgency, enhancing timely communication, perfecting role plays, and measuring the performance of each sales team member.
Constant Review and Adaptation
Both variables—leads and conversions—must be constantly reviewed. Each morning, I assess the number of leads scheduled for the week and ensure my team is converting at historical highs. Weekly role plays prevent rustiness and keep everyone sharp. Effective sales leadership means being able to perform the same processes you expect from your team. You must know what you expect—no exceptions.
Take Action
If sales are down, examine those two metrics, eliminate excuses, and increase effort. This approach has allowed my businesses to thrive, even in tough times. Remember, success in sales boils down to a simple formula: Leads x Conversion = Sales. Embrace this, and you’ll see the difference.
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