Service providers invest substantial resources to attract new customer leads across a range of marketing channels. Yet too frequently, customers are lost for avoidable reasons. However, this can be mitigated with advanced sales analytics.
3 Considerations To Drive Indirect Sales With Sales Analytics
by Samuel Kornstein
In today’s highly competitive network landscape, service providers must be able to make the most of the resources they invest in attracting new customer leads. Yet retention remains a substantial challenge.
Unfortunately, though marketing investment attracts qualified leads, these opportunities and initial good-fit customers are lost for avoidable and unnecessary reasons. These losses are often the result of poor customer experiences or ineffective needs identification - and create increased acquisition costs for the service provider.
Here, advanced sales analytics are essential to prevent avoidable sales losses by identifying, quantifying, and remediating avoidable concerns.
Service providers typically measure the performance of direct sales channels and can identify and resolve issues quickly. However, the visibility of issues in the indirect sales process is often worse.
Irrespective of channel, when a prospective customer enters the sales funnel, it is critical that the right actions are taken to close the sale and initiate a long-lasting customer relationship.
So what actions and considerations should service providers make to drive indirect sales and prevent avoidable losses with sales analytics? Here are 3 key considerations.
1. Use sales performance analytics to right-size and improve LTV
To retain customers long-term, prevent churn, and achieve greater customer lifetime value (LTV), it’s important to be able to right-size customers initially, and ensure they’re aligned with the right package for their requirement at the point of sale.
There are many reasons for cancellations that create customer loss. Some cancellation drivers, such as installation, equipment or credit issues, are not easily rectified or influenced in the sales process.
However, other issues are rooted in poor customer right-sizing at the point of sale so can be monitored and mitigated via sales analytics. These reasons for cancellation include high pricing, competitive offers, and buyer remorse.
Right-sizing effectiveness (to guard against those cancellation drivers) can be evaluated by tracking several performance metrics across the sales and customer lifecycle, such as:
- Conversion rates: What share of leads convert to purchase?
- Pre-activation cancel rates: What share of purchases activate?
- Early-tenure churn rates: What share of activations turn into long-term relationships?
Using sales analytics to monitor these three metrics can provide valuable insight into indirect sales problems and poor right-sizing issues, such as over upselling or underselling, which result in customer misalignment on pricing.
Having the insight to make small improvements that incrementally raise conversion rates or reduce pre-activation cancel rates can have a substantial impact on overall sales volumes. Similarly, reducing early tenure churn through improved customer needs alignment can reduce short-lived customer relationships, increasing average customer lifetime value.
2. Leverage indirect sales analytics to develop ROI-positive programs
To truly drive sales improvement, it’s important to do more than just track sales metrics. Considered trends analysis is required to uncover the largest growth opportunities - which should then be implemented as channel programs. A robust analytics platform is important to achieve this, enabling service providers to:
- Easily integrate a range of data sources from disparate sources across the organization;
- Determine which factors drive different outcomes, and then identify the largest actionable opportunities based on service provider and sales partner data; and,
- Develop and implement data-driven growth programs based on these opportunities and measure the results.
Throughout sales, onboarding, and product usage, service providers collect a wealth of information. If leveraged in the right way, this data can provide valuable insights into what’s working and what isn’t in channel sales.
By gathering and integrating all this information at the customer level, sales analytics can extend beyond high-level sales metrics to help identify the performance drivers behind them, and deliver greater ROI. For example, analytics will enable you to clearly see which indirect sales partnerships are most fruitful or underperforming, streamline product sales strategy to protect against churn in high-risk segments (see Illustrative), or identify and resolve areas of sales process friction.
Illustrative: Evaluating Customer Churn and Customer Lifetime Value by Broadband Speed
Source: Case study in Cartesian's "Using Analytics to Drive Indirect Sales" guide
A flexible analytics platform that facilitates the correlation of sales metrics with a range of contextual data sources, can help indirect channel executives understand which factors influence sales outcomes and use this information to develop ROI-focused channel programmes.
When there is a high level of analytics maturity, more advanced data-driven strategies leveraging predictive analytics and machine learning can be developed. Product recommendation engines are one way to achieve this.
A product recommendation engine, at its most basic level, is a predictive analytics algorithm that synthesizes all available data about a prospective customer and predicts the most appropriate products and services to be sold.
By analyzing patterns, indirect sales partners can determine data elements collected at the point of sale (e.g. demographic and psychographic information) and segment these specific insights. This can be used to predict which products and services are most likely to provide service providers with positive sales outcomes and right-fit retention.
Service providers that build and maintain product recommendation engines to inform their indirect sales partners have an edge over their competition.
They leverage the valuable data they collect to guide partner interactions with customers, ensuring that the right products and services are always the focus. From the outset, this provides a positive customer experience and improves right-sizing, helping to boost sales and increase customer lifetime value.
Using Advanced Indirect Sales Analytics For Competitive Advantage
When well executed, sales analytics can create clear value for service providers and their indirect sales partners across the customer lifecycle, including at point of sale, during onboarding, and through product use.
Enabling service providers to better identify opportunities for improvement, develop better processes, and encourage better decisions among indirect sales partners, sales performance improvements driven by advanced indirect sales analytics translate into:
- Longer customer relationships;
- Reduced customer loss;
- Greater customer profitability; and,
- Competitive advantage through optimized business practice.
Of course, this process isn’t static. To see benefit long-term requires continuous iteration, flexibility and improvement.
Success starts with effective data collection and aggregation, and continues through the implementation, analysis, development and testing of data-driven processes and programs that create value.<>