Informing business decisions through Sales Analysis

What is Sales Analysis?

Sales Analysis is a critical and vital analytical tool for any business looking to grow, not only does it show the performance of your business, but also gives you detailed reports on product revenue, in-depth customer data (demographics, geographic and consumer interactions, etc) to the performance of sales for not just your business but also, more importantly, your sales team.

Utilizing it will give you key data-driven information that can help you make informed decisions on sales and product strategies, which will lead to better returns and better growth.


Why is Sales Analysis Important?

For a growing business, sales analysis is essential for growth be it in a crowded marketplace or as a first-mover, running sales analysis through an ERP system will not only be beneficial in terms of understanding your customers but will also give you the advantage of understanding key market data and trends that can help increase your market share

Sales Analysis is Important as it gives key insights on:

  • Utilising long term data

As a business tracking data from the origin point can be incredibly beneficial as you experience growth in the years ahead, tracking your sales for the long term can help give you comparison points that can be beneficial.

For example, if you introduce loss leaders to stimulate other products/services offered, you can compare the sales data to a time when you did not implement loss leaders and contextualize it within a report to see how much profit was generated from both sales strategies.

Moreover, this can be great for accruing investments, as a long-term sales report on your company’s growth can have a positive influence on data-driven investor decisions.  

  • Customer Analytics

Having the ability to understand consumer behaviour is key to not only understanding what makes your customers tick, but analytics gives you furthermore data-driven information on your customers that can lead to incredible conversions that result in better sales, and give you key information on customers that can help retain them better.

By analysing sales performance, you can make data-driven decisions to find the needs of potentially profitable customers and formulate strategies that fit better to their needs leading to exponential growth.

  • Market Analysis

Sales analysis gives you key insights on market trends through past and current data, helping you identify key opportunities, analysis of sales performance of product/service offerings, and giving you the ability to foretell sales revenue and inventory sold in certain periods of time

Sales analysis gives you key data points on your audience to help you build awareness and create better marketing campaigns that can lead to higher conversions and more sales


Key Types of Sales Analysis

There are a number of Sales Analysis Techniques you can implement with the right software to better your business, however, to keep it short and succinct let’s go through the 5 Key Techniques that will infinitely help you improve your business operations once implemented

  1. Sales Performance Analysis
  2. Product Sales Analysis
  3. Predictive Sales Analysis
  4. Marketing Research

Let’s methodically dissect each technique to get a better understanding of why it would be hugely beneficial to your business

1. Sales Performance Analysis

Sales Analysis
Image by Lukas

Perhaps the most indicative of the worker performance within your business in terms of the sales team, you can use this technique to essentially monitor your sales team’s performance, from not just the sales accrued via your reps but also incur a financial-based analysis on revenue/profit generated from a collation of departments

Our reports can specifically target and focus on the important results you would like to see, this can be from revenue to profits, to indicating poor sales performance of teams/individuals. With this information, you can tailor and trial differing strategies to see which one will give you the results you expect from your sales team. Or even more, you can use this analytic technique to find gaps and offer better prices etc.

2. Product Sales Analysis

An essential tool if you are offering multiple products at a time, this can be essential if you are a retailer and have a variety of product offerings in your timeline, implementing this technique can help you do a routine check on offerings that aren’t giving you the revenue or demand you would want, from there you can re-strategize a plan to either improve on the product or its marketing to inform future decisions on whether the product should be promoted or discontinued

Implementing product sales analysis is highly vital, as you can use this data and pinpoint areas to target through demographics, popularity, costs, and revenue generated with each offering, from there as said before helps enable you to make more informed decisions about your product offerings that can add considerable growth to your business

3. Predictive Sales Analysis

Sales Analysis
Image by Cottonbro

This technique can be incredibly beneficial for making strategic decisions with your product/service offerings acting as sort of an algorithmic fortune teller that foretells the future depending on your current and past sales reports. You can use these reports with even existing customers increasing their CLV (Customer Lifetime Value) by targeting areas of opportunity where you can upsell, cross-sell by tracking customer behaviour.

By integrating this analytical software you can utilize data-driven decisions to either improve or stall sales strategies

4. Marketing Research

Being on top of market trends is essential for an evolving business landscape with a global level of consumers who have differing preferences, market research can also stem from the analysis of competitor methods, this can be how they price their products, to even how customers interact with them and vice versa. Using this you can dissect their strengths and weaknesses, implementing them into your own strategy to improve it or keep it the same (in the case it’s already quite successful).

It is highly beneficial to do this research routinely to maximize data-driven decisions and implement them into product offerings to maximize your sales.


Photo by Athena

It is highly beneficial to do this research routinely to maximize data-driven decisions and implement them into product offerings to maximize your sales. 

You might be wondering how would you go about utilizing these analytical techniques and applying them towards reaching your sales goals, let us go through a step by step process


Photo by Thirdman

Step 1 – Outline your Sales Goals

This is the process where you start asking yourself what the end goal of your business is and how you can achieve it, here are a few things you can think about while discussing goals with your sales team

  • Determine initially what the sales goals are to be
  • What is your best product/service offering depending on sales data acquired through the analytical process
  • Build a profile on the customer, including a basic outline of their needs and wants in terms of your product offerings and how it could benefit them
  • Is there a negative pivot within the sales process you administer and teach your team, what steps can you take to mitigate it, this can be instilling e.g. a new script if you are a telemarketer
  • Develop an observational data report to see how well employees have done after doing their sales training, if it isn’t causing growth in sales you might need to change strategies
  • Improve price points and value on product/service offerings depending on analytical data
  • Refining your product offerings

Whatever your sales and business goals are, the first step is to outline them. 

This will help you figure out the exact data you needed so you can track it over time, like a longtitudinal study and analyse the effects of different strategies within your sales pipeline. So, be very clear on what your sales goals and what metrics matter most to your business. 


Step 2 – Choosing a Sales Analysis tool 

Deciding which metric to track through your sales dashboard can be a complicated project, so its important to discern and divide the results to a more tangible metric you and your team can keep track of and understand, through this process over time you can slowly input new data points and keep track of them at a steady pace provided your whole team has been through enough training to understand the data provided by analytical tool and they are trained to apply and implement them as part of their sales strategies

Data such as customer metrics and insights into lead generation can help supervisors and managers re-evaluate and refine their sales process based on data driven decision making for the benefit of the organisation down to a quantitative level. Key metrics you can look at to evaluate your team can be through revenue generated by sales, product, or even the lead you use.

Moreover, understanding CLV (Customer Lifetime Value) also helps you prioritize where to spend your efforts. Using CLV enables you to make decisions as to how to best allocate our resources.

The customer lifetime value is a clear indicator of what a company can expect in revenue from each customer. This can be beneficial in a number of ways, including comparing customer service costs to income from products and services.


So…

Sales analysis is a huge part of developing and growing into a successful organisation as it gives your business the ability to expand and sell using proven data driven strategies that can ensure the growth of your company, maintaining and building new customer relationships.

More importantly, Sales analysis keeps your business relevant and applicable to new and emerging market trends, helping your organisation in a competitive global market