How to Define Your Middle-of-Funnel Goals and Set Your Sales KPIs

January 16, 2019

Highly-qualified leads are worth their weight in gold, and once you've grabbed their attention in the top of the funnel, you don't want to lose it to an un-optimized leak.

Now that you've converted your MQLs to SQLs, it's all up to the sales team to take them to the finish line—but first, they have to make it through the middle of the sales funnel. Getting it right in this stage is critical to your company's success.

In order to get the best out of your team, you’ll need to understand each step in the middle of the sales funnel set motivating goals for these steps, and define sales metrics and key performance indicators (KPIs) to track progress.

Read our last post, How to Define Your Top-of-Funnel Goals and Set Your Sales KPIs, to learn about the top of the sales funnel.

Mapping the Middle of the Sales Funnel

While the top of the funnel is where you capture interest in your product, the middle is where your sales team does the real work of turning that interest into a purchase decision.

So what steps make up the middle of the funnel?

Just as we did with the top of the sales funnel, we'll look at the middle portion through the lens of inputs and outputs to identify each stage or conversion point: what goes in and what comes out.

Middle-of-Funnel Inputs: SQLs and Scheduled Demos

In the top of the funnel, your sales team receives MQLs from the marketing team, then contacts the lead to ask qualifying questions in order to convert them into a sales qualified lead, or SQL. This sequence is likely completed by a Sales Development Rep or SDR within the sales team.

SDRs may also be responsible for scheduling demos or meetings between sales reps and leads immediately after they've been qualified. The advantage of this approach is that your team may have more success scheduling demos if they strike while the iron is hot. Waiting until they've been passed to a sales rep gives time for the lead's interest to cool off, and it may be difficult to grab their attention a second time.

If you aren't starting with scheduled demos, don't fret. Remember, SQLs are leads who have already expressed interest and been qualified as good potential customers, so you're still in a good position. Make the most of it by reaching out to new SQLs as soon as possible after you get their contact information.

Conversion Stages for the Middle of the Sales Funnel

The middle of the funnel is all about educating potential customers about your products and services, assessing their needs, and determining whether they're likely to become a paying customer in the near future.

Depending on how granularly your team tracks their pipeline, you may look at the funnel in its major stages, or you may want to track each desired action a prospect takes towards purchase. Here are a few possible steps or conversions you may want to track in your funnel:

Track your demo calls on a Grow sales dashboard.

1. Demo or Discovery Call

When it comes to sales, the demo or discovery call is like the first date: you're getting to know them, they're getting to know you, and you're both trying to decide if you really want to spend more time together.

If you're providing a demo of the product, make sure it looks its best and shows off its best features. To set the right tone, ask the right questions, and truly listen to what the prospect needs. This will not only give you insight into how to adjust your pitch, but it will help establish good rapport.

Track your opportunity conversions on a Grow sales dashboard.

2. Opportunity

An opportunity is just what it sounds like—a real chance at making a sale and earning revenue. If a demo goes well and your product is a great fit for the lead, you know there's a good chance that they'll purchase, and you can convert them to an opportunity in your CRM.

Track your trial conversions on a Grow sales dashboard.

3. Trial

For some companies, the best sales strategy is letting people experience the product for themselves. Offering a trialperiod helps potential customers learn for themselves what they like or dislike about the product and whether it will suit their needs, without having to make a full commitment yet. If your company does offer a trial, you'll want to make sure to account for it as a stage in your funnel.

Track your proposal conversions on a Grow sales dashboard.

4. Proposal

Although not nearly as nerve-wracking as a romantic proposal (usually), sending a sales proposal is a big step. The proposal outlines the products and services you hope to provide the customer, along with pricing and contract terms. Sending a proposal opens the doors to negotiations—from here, the client can agree to the terms, or propose changes such as adding or removing services, adjusting details, etc. Most proposals will go back and forth a couple times before both parties are satisfied.

Middle-of-Funnel Outputs: Opportunities and Proposals

Although the middle of the funnel takes leads all the way through to the proposal stage, many companies will still refer to them as "opportunities" or "open opportunities" until the agreement is signed and the deal is officially closed.

Regardless of terminology, the middle of the funnel brings prospective customers to the brink of purchase: all the cards are on the table, and they'll either choose to buy or they won't. But that decision is for the bottom of the funnel.

Delays, Detours, and Brick Walls

The reality for most companies is that a majority of leads won't make it to the bottom of the funnel. However, that doesn't mean all is lost.

When things seem to be going south with a prospect, take the time to communicate and understand what's going wrong: Is it a delay, a detour, or a brick wall? Sometimes, you just need to wait until the timing is right or work around a problem to save a deal, but don't assume there's an insurmountable issue without taking the time to ask. If it makes sense for your company, consider adding an "on hold" stage for opportunities that aren't actively progressing, but may in the future.

Track your middle-of-funnel sales conversions on a sales dashboard easily.

Setting Middle-of-Funnel Sales Goals

When you're setting goals for this part of the funnel, a guiding principle should be momentum, moving prospects steadily from one stage to the next and making the most of their "warm" interest.

Because there are more stages in this part of the funnel, it's important to have goals for each, rather than focusing solely on the overall number of opportunities created or proposals sent.

Each stage of the middle of the funnel has an input and an output—SQLs become Demos, Demos become Opportunities, Opportunities receive Proposals, etc.—so your goals should be to squeeze as many conversions as possible out of these steps.

Reverse Engineer Your Funnel

If your company aims to hit a certain revenue goal each month or quarter, it may be helpful to look back at past performance and reverse engineer your funnel conversions to set targets for each stage.

For example, if your historical Demo-to-Opportunity conversion rate is 10%, and your goal is to create 10 opportunities, you know your demo goal should be 100.

Following this process all the way back, you can set goals for each stage of your funnel and trust that if you hit each one, you should be able to hit your overarching revenue target. To be on the safe side, aim a little higher than necessary and give yourself some wiggle room.

Tracking Key Metrics for the Middle of the Sales Funnel

Goals are really just wishful thinking unless you have a way to measure them. Using data from your CRM and other sources, sales metrics allow your team to clearly see how they're progressing towards their targets.

Some metrics will be key performance indicators, or KPIs: these numbers are how you truly define success for your team. Other sales metrics aren't necessarily indicators of performance, but can still provide helpful supporting information about your sales team's activities. Every company does things a bit differently, so you'll have to tailor your sales KPIs to your team's particular needs. Here are a few ideas to get you started:

Monitor your demos set to demos held ratios on a live sales dashboard.
  • Demos Set vs. Demos Held: If your team deals with a lot of no-shows on demos, it can help to start tracking this ratio. Then, as you adjust email sequences and follow-up calls, you can monitor how it improves demo attendance.
  • SQL:Opportunity Ratio OR Demo:Opportunity Ratio: As the first conversion in the middle of the funnel, it's important to know what portion of leads/demos are progressing to the opportunity stage. Then you can further optimize your demo strategy to improve that ratio.
  • Number of Customers in Trial: If your company uses a trial, you'll want to keep track of how many customers are active in that process. This can also help you ensure your team is staying in contact with those prospects whose trials are ending.
mointor your open opportunities over the last 90 days in near-real time on a sales KPIs dashboard.
  • Number of Open Opportunities: The opportunity stage is a major step along the middle of the funnel, so knowing the number of opportunities your sales team has open at any given time is key, especially as you begin to forecast the number of deals you expect to see closed in the near future.
  • Value of Pipeline: After a proposal is sent, you can assign a dollar value to each opportunity. While there may be some adjustment to contract values during the negotiation and closing process, understanding the potential revenue the team expects to bring in each month is critical information.
  • Sales Activities by Rep Activity: These counts can easily become vanity metrics because they don't tell you as much about performance and success as ratios do. However, they can be useful for sales teams if they're used to encourage competition between reps.

Preparing for the Bottom of the Funnel

After a lead has been qualified to an SQL, given a demo, converted to an opportunity, and given a proposal, the next step is to close the deal. Successful closing depends heavily on making sure the prospect gets the information they need in the middle of the funnel.

The better informed prospects are during their decision-making process, the more confident they'll feel in their purchase, and the more committed customers they'll become. Prepare leads for the bottom of the funnel by understanding their needs, providing great demos and supporting collateral, and delivering informative proposals.

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