I recently had a conversation with a BDR Manager and she said something that every Inside Sales team is feeling right about now: the game is evolving quickly, and it’s a challenge to keep up.
[I’ll pause until you stop nodding your head.]
Even though you have to evolve your style of play to stay in the game, the basics don’t change. As far as the basics go, we advocate a pretty simple approach to sales mastery: mindset, process, and skills. Nail those, and you’re the sales equivalent of a quadruple black belt.
When we talk about process, one essential component is activity levels. Namely, your team has to maintain a certain level of activity to give yourself the best chance of success. This allows for rapid skill development, constant feedback loops for coaching and improvement, and more opportunities to succeed. In other words, the right level of activity means you have a chance to hit revenue, profit, or ROI goals.
In the words of the great basketball coach John Wooden:
“In my coaching I informed every player who came under my supervision that the outcome of a game was simply a by-product of the effort we made to prepare. They understood our destination was a successful journey – namely, total, complete, and detailed preparation.”
There’s something else you should know about activities: they’re tangible. Your SDRs may not know how to drive $950k in additional revenue, but they definitely know how to make 50 calls and send 50 emails every day. Your SDRs can’t action revenue or meetings, but they can take concerted and steady action on daily activities.
Now, you might not know where to start in translating your goals into activities. There are three main ways you can approach this, and each answer a slightly different question.
Setting Daily and Weekly Activities for SDRs
Question: How many daily activities do my SDRs need to hit their meeting goals, and for me to hit my revenue goals?
This is the gold standard. Going back to the “process” part of sales mastery, setting daily and weekly targets is something that your SDRs can actually do and track on their own. There’s no mystery.
Serena Williams had a big goal in mind – win Wimbledon, or the US Open – but she couldn’t just do that. To become the greatest tennis player ever to live, she needed to practice first. And she couldn’t practice winning a major tournament.
Instead, she practiced forehands, backhands, and drop shots. She practiced footwork and serving. She practiced her reaction time to opponents’ serves, and she improved her conditioning. She understood the skills and activities required to have a chance at winning Wimbledon.
Your SDRs are no different. Using an activity-based approach tells you what your SDRs need to do to be successful, and it tells them what they need to do to make a million dollars (they can dream, right?). Setting activities also allows you to vet and track your critical metrics like close rates, reply rates, and touches required to reach a yes/no from a prospect.
This calculation is a little complicated, but it’s well worth the effort. You can grab a free copy of our calculator here if you’d like an answer in 30 seconds. Here’s a look at how it’s set up:
What to Do
- Set the number of daily and weekly activities you need from your team. You have to do it!
- Grab our free calculator – no email address required – and punch in your own numbers to find out how many activities your team needs to execute.
- Check your activity numbers against benchmarks so you’re not expecting too much or too little of your SDRs. Julianne Sweat from Outreach.io suggests about 140 activities per day, spread across 50 calls, 65 emails, and 25 “other” activities like social selling.
- Choose daily and weekly activities. We prefer to set daily outreach activities, weekly number of prospects added, and monthly meeting quotas.
What Not to Do
- Don’t treat your activity number as “set it and forget it.” Make an educated guess about where to set your activity goals, then check in once a month to see how your team is tracking. Make adjustments.
- Don’t give daily and weekly activity quotas without an explanation, and don’t make your goals unrealistic. It’s demoralizing if your team can’t achieve their goals.
- Err on the side of setting your goals slightly too low. That way you have room to move up while building small wins and morale.
Determining ROI per SDR
Question: Based on the quota set today, what is the return on your SDRs acquisition efforts?
Instead of backing into a quota, you might be wondering what the return is on the quota you’ve currently set for your SDRs. All you need to know to figure this out is your current quota, the fully loaded cost of your SDR, LTV, gross margin, and the conversion rate of initial meetings to closed opportunities.
Here’s an example of how you might set it up:
What to Do
- Use the ROI per SDR calculation if you’re interested in measuring the financial return on your SDR team.
- Plug in the best numbers you have on gross margin, LTV, and initial meeting to close (including only the historical data from your SDR team, not inbound leads or other lead sources).
- Understand that you’ll have some imprecision in your data, but the tool can help you make decisions about realistic benchmarks for your team. That includes top performers, under performers, or even providing a data point on whether to expand or contract your team.
What Not to Do
- ROI isn’t a good calculation if you’re in rapid acquisition mode. If your strategic mandate is acquiring as many customers as possible, ROI may not be the right calculation for you.
Meetings for Target Returns
Question: How many meetings does an SDR need to get to pay for herself, or create a 100% or 500% return?
If you’re looking for a specific return, you might be wondering how many meetings your SDRs need to set in order to hit it. The advantage of this approach is you can quickly see what it will take for your SDRs to pay for themselves, and it’s a great tool for hiring decisions, too.
The limitation of this approach is that it doesn’t consider how realistic the meeting targets are, so you’ll have to use your judgment here.
Here’s a peek at how we set it up in our calculator:
What to Do
- Use this calculation if you’re not sure where to set your meeting quota and you want to target a specific return.
What Not to Do
- As tempting as it is, don’t just pick the highest number and make it a requirement. Your quota should be based on what’s realistic so your SDRs have the best chance to succeed.
Being Inaccurate Is Okay
The first time you go through this exercise, you’re going to be inaccurate. That doesn’t mean you’re wrong. Just the opposite – you’ll have much more information than you had before you started the exercise.
More importantly, accuracy requires calibration. Start with the best information you have on hand, then check in monthly to see how things are progressing. It’s okay to update as you go, and you may even learn that your Inside Sales team is kicking so much butt that you should double your headcount in the next 6 months. Wonderful!
And if you don’t want to take the trouble to build this calculator yourself – it’s a pain, I can assure you – feel free to grab a copy of our calculator. Just make a copy of the doc and enter your own data to get the answers.
- Your SDRs can’t action a revenue goal or “get a meeting,” but they can hit daily and weekly activity levels.
- Set and track your activity levels based on your revenue goal or desired return. Check in monthly to see if they need to be adjusted.
- Compare your activity goals against industry performance benchmarks to keep them realistic.
- Practice makes perfect – or at least closer to perfect. Starting with activities ensures an adequate and consistent level of practice across your team.
- Track your performance metrics – conversion rates, open and reply rates, LTV – so you can get more and more accurate with your activity levels and their yield.
Happy hunting (and farming)!
The post How To Set Sales Goals For Your SDRs & Determine Their ROI (Free Calculator Included) appeared first on Sales Hacker.