Updated on November 21, 2022
It’s important to have a strong sales development team in place. Not only will they help you reach your targets, but they can also be a key part of how your revenue engine functions.
SDRs are accountable for generating 30-45% of their company’s revenue, which shows their role’s importance and how crucial it is to get them right from the start and track the results.
And, to measure sales development teams’ performance, it is important to set specific goals and expectations to make objectives clear. As we like to call them in our team as well – the SDR KPIs.
In this article, we will take a look at some of the most important SDR KPI metrics which have been shown to provide the most helpful insights about your team’s performance.
What should you consider as SDR KPIs?
One thing that’s important to know is that an SDR stands for sales development rep, while a KPI stands for a key performance indicator.
An SDR KPI is a metric that is commonly used to measure sales reps performance, and it helps you see how closely their performance meets company or industry benchmarks.
So, with all the possible data to track and analyze, how should you approach finding the best SDR metrics?
Always start with the metric that matters most, revenue.
Main SDR KPIs
Recent studies from Operatix found that each sales development representative (SDR) can deliver up to 15 meetings/sales accepted leads per month, with an average dropout rate of 20%. This means the sales team will get 12 meetings/leads attended in a month.
From there, 1 in 3 booked meetings generated by our SDRs will lead to the next step in the sales process.
So, if the 4 monthly meetings see the end of the tunnel in the sales pipeline with an avg. of let’s say 1K dollars for a deal that will bring 4K in your sales pipeline each month.
If your revenue KPI as a micro/small business is let’s say 10-12K monthly you would need to either hire 3 more people or give the target of 12K over three months.
2. The sales pipeline metrics
Sales pipeline metrics is the term that encompasses all of your sales funnel metrics. Everything from contacts and leads down to customer expansions, and deals won falls under this category of sales pipeline metrics.
Counting these metrics can tell you a lot about where your sales pipeline is in terms of “health” and about where you may be struggling to generate revenue for your company.
- New contacts in the pipeline: It’s important to track where these leads are coming from. It will be a good indication of whether your outbound team is assigned enough leads to work with.
- Newly generated leads: You should have your sales team keep track of this. If there are no new leads, this means that optimization of the process needs to be done.
- Sales accepted leads: One way to measure the quality of your lead management efficiency is to track how many sales accepted leads your inbound leads and calls produce.
- Sales Qualified leads (SQLs): Usually, come from MQLs. Qualified leads are post-meeting leads that are qualified to continue in the sales process. You may get a higher return on your sales management efforts by prioritizing these lead types over others.
- Closed won: These are the deals with a signed contract and a firm “yes” from the prospect
- Closed Lost: These are deals that made it through the sales process, but they weren’t won, thus no revenue was generated.
3. SDR Outbound Activity
To reach their average 4 closed deals a month, outbound sales reps need to pursue a lot of opportunities each day. These combine different outbound SDR activities that need to be measured with a separate KPI for each.
These KPIs usually include measuring:
- Performed cold calls
- % of meaningful conversations (or number of warm leads)
- Number of booked meetings
- Launched cold outreach campaigns
- Linkedin connections
- Reply rate of the cold outreach campaigns
- Booking rate of the cold outreach campaigns
4. SDR Inbound Activity
Inbound metrics vary a lot more than outbound metrics because sources of leads and level of intent factor into conversion rates. And these activities are tightly connected to marketing activities. However, the results of them should not be neglected and should be properly measured.
The KPIs for the SDRs in terms of inbound activities include:
- Calls performed based on inbound leads
- Follow-ups on inbound leads
- Chats attended for inbound leads
- Offers sent to inbound leads
- Closed deals from inbound leads
As you can see inbound and outbound KPIs differ slightly – but the fact remains that they all point toward generating revenue.
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How large should your SDR team be according to set KPIs?
When it comes to the inbound department, this grows to meet the demands of the marketing team. The stronger and more frequent their leads, the bigger their inbound team.
To assess which leads could be potential candidates for your company, a rep should first ask: “Does this lead fit with our company, by considering the industry they work in and where they are located?”
The ultimate goal of an inbound rep is to qualify their leads so they know whether to stay on the line or not. Engaging with them and setting up an introductory phone call with an account executive can allow the sales process to be transferred so the caller can do what they’re really good at.
Basically, the number of leads generated by your marketing team will determine how large or small your team should be. When averaged, an inbound SDR can follow up on 10 leads per day, which means that a total of 220 leads can be followed up in a month. Based on your conversion rates and revenue KPI you can determine the number of Inbound SDRs you need for your team.
On the other hand, for the outbound SDRs, this all goes back to the revenue KPI again. As mentioned above you would need to scale up your SDR team based on the deal-closing rate a single SDR can perform monthly (or quarterly, or yearly, depending on the time frame of your KPIs).
How to set your SDR KPIs tracking?
We already looked at how to set your targets, so let’s dive a little deeper into what goes into them. When a revenue goal is set, the project management team can determine what it will take to generate that revenue. First, start with the meetings arranged to secure the pipeline. Set your KPIs with measurable, yet realistic numbers in accordance with the size of your team.
Our pro tip is to establish a connection between your prospecting channels and the CRM your team is using. This way both sales managers and the SDRs will have a clear overview of the daily activities and their success in different stages of the sales funnel.
You can use KPI tracking apps to put in your targets and assign special tasks to each SDR to enable them to keep track of each KPI individually. Any dashboard-building app would also work for this, or even a Google Sheet template with formulas. The most important thing is to keep the KPIs and SDR data visualized so that your SDR team can stay motivated and recognized. This will encourage the sales culture and accountability for your team.
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