Recently I posted a blog that was focused on the fact that what you don’t know can really hurt you in the world of media sales. I briefly covered three topics: knowing who your best accounts are, the amount of attrition you are experiencing, and what is in your sales pipeline.
Often, one of the most miserable meetings of the week for a sales management team is the projections meeting. Corporate has asked you as a team to project where revenue will be added in the coming weeks or months in order to assist the GM in managing the business of your operation.
Why are these meeting so miserable? They certainly can be if you do not have confidence in your sales team’s ability to accurately communicate pending business. Let’s take a quick look at a couple of ways to assist salespeople in reporting up to you, and in turn, to improve your ability to be more accurate when conveying data to your superiors.
What business or revenues are your reps communicating to you via a weekly projections report that they believe they will have proposed to clients at any given point in time. In other words, what’s pitched or proposed? There are a couple ways to look at this number.
- The first way to analyze the funnel is BASIC pending. Basic pending includes all the business in the funnel at any given point in time, meaning the total dollar amount that your sales team says is out there. You have to make some assumptions when looking at basic pending, because it is just a total amount of potential billing out there without any other criteria to help you filter it. It is a simple way to analyze the funnel, but not always the most dependable, in my opinion.
- A second way to analyze pending is by level of confidence. You can ask your reps to associate a percentage of confidence with each piece of business in their funnels. This will allow your sales team to communicate to you their belief in their ability to actually close a piece of business. So if, as a manager, you only want to include in your projections meetings business that has a 90% confidence level associated with it, you can be very comfortable that the sales team will deliver that number to you moving forward. This will also help you analyze rates and inventory controls, because you will know that a set amount of business is coming on the books in the next 7 days. You can now adjust rates and sell-out levels.
- The final area for which you need visibility in order to make your projections meetings less painful is a standard set of confidence levels that everyone on your sales teams understands. All reps express confidence differently, as we know. Some reps on the team will confidently say, “I am going to close everything!” but sadly end up being sandbaggers who give you a bad case of anxiety because you never really know what to expect from them. This is what gets you in trouble when it comes time to deliver a number to corporate. So, as the manager, YOU must define the confidence levels. Try these levels and adjust as needed:
- 90% means “You can count on it.” The contract is in the hand of the client and the parameters have been agreed to.
- 75% means “I feel very good about this piece of business. We are in negotiations and I believe it will be moved to 90% in the next 7 days.”
- 50% means “Just maybe.”
- Anything below 50% should not even be reported to you.
Once you decide how you want to look at your pending business, just understand the types of assumptions you may need to make in terms of basic or level-of-confidence pending. Many quality media sales CRMs, such as Efficio and others, have this pending component already available to you in their systems. Make sure you take advantage of this tool so that you will have a higher level of confidence when you report your numbers each week to corporate.