What A 9% Win Rate Increase Means In Real Sales Results

In their 2011 Sales Performance Optimization study CSO Insights reported that B2B sales organizations with a formal prospect definition experienced a 9% greater win rate than those with no formal prospect definition.

We analyzed the value of that 9 percent advantage in our Sales Revenue Forecasting model based on numbers we had seen with an actual 3FORWARD client.  Here’s the impact it produced.

 25% Win Rate34% Win Rate
Total Annual Contract Signings$18,000,000$19,620,000
Total Realized First Year Revenue$5,062,500$5,518,125
Required Full Year Proposed Pipeline$72,000,000$57,705,882

Instead of a 25% win rate resulting in booking $4.5 million per quarter, this company would instead book $4.9 million per quarter at the 34% win rate.  Here are the other results of an improved win rate.

The Benefits of a 9% Sales Win Rate Improvement

  • The company increases current year revenue by nearly half a million dollars.
  • The actually book $1.6 million more in annualized contract value – raising the revenue projection for their next full year.
  • They are required to identify and process $14 million less in total annual proposal throughput.

To begin experiencing benefits like these, start by formally defining your target prospect.   We actually begin all 3FORWARD client engagements by going through this exercise with our clients – for obvious reason!  We suggest using a template such as our Sweet Spot Matrix to create your initial prospect definition.  You can always layer in additional levels of definition over time.

Who Should Be Involved in Prospect Definition

Formally defining your ideal prospect is not solely a sales activity.  Other company groups that should be included include the following:

  • Marketing
  • Implementation
  • Delivery / Operation
  • Product Development / Service Portfolio
  • Finance

Each of these groups will have a unique and important perspective on what the ideal client represents from their point of view.  All of that input should be considered when defining your company’s perfect prospect.