Article
Pipeline Generation - SaaS Barometer Newsletter
thesaasbarometer.substack.com
Quoted on this wiki
Every place a page here uses this source, in the order the words come in it.
Marketing CAC Ratio, Sales Development CAC Ratio, and Account-Based Program CAC Ratio should be calculated. “Each dollar of pipeline generated should be measured by pipeline source to calculate the conversion rate from qualified opportunity to Closed-Won.” 𝐼𝑛𝑏𝑜𝑢𝑛𝑑 Marketing 𝑙𝑒𝑎𝑑 𝑐𝑜𝑛𝑣𝑒𝑟𝑠𝑖𝑜𝑛 𝑟𝑎𝑡𝑒 (𝑏𝑦 𝑠𝑡𝑎𝑔𝑒)
In Win rates
Inbound leads efficiency should be measured by a Marketing CAC Ratio which can include % xDR time/expenses invested in managing inbound leads to get a holistic picture. “Cost per Sales Qualified Lead, Cost per $ of qualified pipeline, and Cost per $ of New Revenue from xDR outbound activity needs to become a TOP revenue growth efficiency metric…” If you are in a GTM function and you do not have a pipeline goal - ask yourself who owns the pipeline at your company. If you cannot answer the question "whose job is on the line for pipeline generation" if pipeline ($) goals are unmet, you may have a problem.
Establish line item quota elements for New revenue vs Expansion revenue for AEs and SDRs - the result will be an increased pipeline focus on each type of ARR. “Calculate, communicate, and publish "pipeline coverage ratio" for every rep, team, and “source” of opportunities for both New ARR and Expansion ARR at the beginning and end of every month or quarter.” Pipeline generation should be the number one measurable objective for the head of Marketing, and the head of Sales Development. This objective should cascade down to every Marketing and Sales Development resource involved in pipeline generation and pipeline capture. Every dollar of new pipeline required to hit the revenue number should be allocated down to the organization, team, and individual level, by having a well communicated and understood pipeline quota that is a primary variable for bonus and/or incentive compensation. This means that everyone in Sales Development and Marketing should own a portion of the pipeline goal. And if existing customer expansion is part of the revenue growth strategy, Customer Success should have an expansion pipeline goal in concert with a Customer Success Qualified Lead (CSQL) goal.
Establish line item quota elements for New revenue vs Expansion revenue for AEs and SDRs - the result will be an increased pipeline focus on each type of ARR. “Measure the % of Closed-Won revenue from pipeline developed in the same period (month or quarter) and factor that into the pipeline coverage ratio and current period pipeline development goals.” Pipeline generation should be the number one measurable objective for the head of Marketing, and the head of Sales Development. This objective should cascade down to every Marketing and Sales Development resource involved in pipeline generation and pipeline capture. Every dollar of new pipeline required to hit the revenue number should be allocated down to the organization, team, and individual level, by having a well communicated and understood pipeline quota that is a primary variable for bonus and/or incentive compensation. This means that everyone in Sales Development and Marketing should own a portion of the pipeline goal. And if existing customer expansion is part of the revenue growth strategy, Customer Success should have an expansion pipeline goal in concert with a Customer Success Qualified Lead (CSQL) goal.
Make qualified pipeline goal ($) the #1 objective and Closed-Won Revenue ($) goal from inbound hand raisers (contact us form or demo request form) the #2 objective for the "𝗛𝗲𝗮𝗱 𝗼𝗳 𝗠𝗮𝗿𝗸𝗲𝘁𝗶𝗻𝗴". “Establish both "New Customer" and "Existing Customer Expansion" pipeline goals - do not combine them as they have very different conversion performance metrics including Win Rate, Sales Cycle time, and ACV.” Establish line item quota elements for New revenue vs Expansion revenue for AEs and SDRs - the result will be an increased pipeline focus on each type of ARR.
I have been discussing pipeline generation and management with industry thought leaders, revenue practitioners and calling upon my own experiences. I am pleased to share the following ideas and best practices. The pipeline “momentum” dashboard shared byBill Binchon an episode of theMetrics that Measure Up Podcastestablishes pipeline specific objectives for AEs and SDRs. Let’s take a look. “It is important to establish pipeline specific objectives for AEs, SDRs, and Marketing.” Additionally, a majority of AE's do not have a specific measurable objective for self-directed pipeline generation. One novel concept is to consider paying a different commission rate for opportunities created and closed from self-directed AE generated pipeline, versus those generated by Sales Development and/or inbound Marketing leads.
I have been discussing pipeline generation and management with industry thought leaders, revenue practitioners and calling upon my own experiences. I am pleased to share the following ideas and best practices. The pipeline “momentum” dashboard shared byBill Binchon an episode of theMetrics that Measure Up Podcastestablishes pipeline specific objectives for AEs and SDRs. Let’s take a look. “Moreover, they are most often incented by meetings scheduled, meetings held, and less commonly, Sales Qualified Leads (SQL) or Sales Accepted Leads (SAL).” Additionally, a majority of AE's do not have a specific measurable objective for self-directed pipeline generation. One novel concept is to consider paying a different commission rate for opportunities created and closed from self-directed AE generated pipeline, versus those generated by Sales Development and/or inbound Marketing leads.
I have been discussing pipeline generation and management with industry thought leaders, revenue practitioners and calling upon my own experiences. I am pleased to share the following ideas and best practices. The pipeline “momentum” dashboard shared byBill Binchon an episode of theMetrics that Measure Up Podcastestablishes pipeline specific objectives for AEs and SDRs. Let’s take a look. “In order to align the event-based measurements with the desired outcome of revenue growth, consider adding both a qualified pipeline ($) and Closed-Won ($) incentive compensation variable to SDRs.” Additionally, a majority of AE's do not have a specific measurable objective for self-directed pipeline generation. One novel concept is to consider paying a different commission rate for opportunities created and closed from self-directed AE generated pipeline, versus those generated by Sales Development and/or inbound Marketing leads.
It is important to establish pipeline specific objectives for AEs, SDRs, and Marketing. Did you know that over 50% of SDR teams do not currently have "pipeline dollars" as a goal? Moreover, they are most often incented by meetings scheduled, meetings held, and less commonly, Sales Qualified Leads (SQL) or Sales Accepted Leads (SAL). In order to align the event-based measurements with the desired outcome of revenue growth, consider adding both a qualified pipeline ($) and Closed-Won ($) incentive compensation variable to SDRs. “a majority of AE's do not have a specific measurable objective for self-directed pipeline generation.” Make qualified pipeline goal ($) the #1 objective and Closed-Won Revenue ($) goal from inbound hand raisers (contact us form or demo request form) the #2 objective for the "𝗛𝗲𝗮𝗱 𝗼𝗳 𝗠𝗮𝗿𝗸𝗲𝘁𝗶𝗻𝗴".
Quotes are verbatim and belong to their publishers. Where a quote has been translated, the original wording is kept below it.