A 10% Conversion Rate Could Boost Your Revenue by 50%. Here's How to Take Advantage. Revenues are often the uppermost metrics businesses use to assess success, but I'd argue there is an even better unit of measure: missed sales opportunities and the reasons why.
- Increasing a sales conversion rate even slightly can have dramatic revenue/profit impacts.
- Tracking where and how potential sales are lost requires an awareness of both internal and external factors, including those seemingly out of your control.
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It's common to close approximately 20% of leads and lose 80%. What's frequently overlooked in the search for growth, however, is that increasing that conversion rate by just 10% can be the equivalent of increasing revenues by no less than 50%. That's why, in my experience, a rigorous analysis of lost opportunities is among the most pivotal steps to consider when a change in strategy is needed.
Typical reasons for lost revenue
Some missed sales are directly related to the selling company, including the product and its pricing and marketing. Some are related to buyers' companies, including having management approval and budgets in place. Some are related to individuals involved in a transaction, including salespeople, the buyer at a customer's company or some other middlemen. Finally, some are related to entirely external factors, including competition and economic conditions. The key is figuring out which of these is/are the reason you lost each opportunity, and then putting detailed actions into place to address each.