For every enterprise sales leader who wants to rethink their team’s key performance indicators (KPIs), there’s a seemingly endless supply of best practices to choose from.
The problem with best practices, however, is that they’re usually past practices. What may have worked well even a few years ago may not guarantee success today. This means that your enterprise sales KPIs should be continually reviewed and adjusted — the same as companies recalibrating their go-to-market efforts to meet ever-changing buyer behavior.
Here are seven enterprise sales KPIs we recommend for today and going forward.
7 Enterprise Sales KPIs to Watch in 2024 and Beyond
1. ACV per Demo Rate
Annual contract value (ACV) is a key metric for all sales teams, but the ratio of ACV generated per demo is a very important sales KPI for enterprise businesses.
To calculate your ACV per demo rate, simply divide the ACV won for a given period of time by the total number of demos booked during that same period. Depending on your product and typical sales cycle, demos booked could be defined as the first scheduled meeting or a completed good-fit meeting with a prospect.
This metric is important because it measures, in aggregate, how much value each meeting with a prospective customer represents. It also serves as a bellwether for the overall efficiency of your sales motion. If your reps are spending significant time and effort securing demos that translate into lower ACV, that’s a signal their time could and should be directed elsewhere.
Many businesses focus on annual recurring revenue (ARR), but this poses potential pitfalls, such as a handful of larger accounts being overrepresented in the overall share of the ARR. Assessing performance with the AAR metric can be risky, because a few dominant accounts can hide an array of problems lurking in team performance — and expose them abruptly if a major account is lost.
2. Sales Cycle Length
Enterprise businesses can require significantly longer sales cycles than smaller companies. Big deals typically take more time to win, involve many stakeholders, and are subject to more scrutiny.
Data from MarketLauncher suggests that the average enterprise sales cycle is six months — a figure that some may find overly optimistic — requiring between 6–8 touchpoints to successfully contact a decision-maker, and a further 10–12 to book an initial meeting.
Sales cycle length should strongly inform pipeline creation and broader goal-setting. Underestimating the length of time between creating and closing an opportunity can result in missed targets and lower revenue, not to mention demoralized reps.
There are several steps sales leaders can take to reduce their sales cycles, including engaging prospects faster, automating their GTM motions, and removing friction from the contract process.
However, according to sales consultant and best-selling author Anthony Iannarino, it’s important to strike the right balance between efficiency and giving deals the time they need to develop.
“Right now, people are getting something wrong — they want to try to shorten the sales cycle,” Iannarino says. “When you’ve got uncertainty, if you try to speed things up, what you’re doing is taking away the time prospects need to have a conversation, to be confident and certain that what they’re doing is right, and that they’re going to be able to execute.”
3. Value per Additional Meeting
Given the length of the typical sales cycle, it’s important to contextualize metrics with the number of meetings it takes to actually secure a deal. More meetings typically means longer negotiations, which are ideally offset by higher contracts.
ZoomInfo assesses the value per additional meeting by measuring the unit value of each meeting on a closed deal to determine how opportunities that take two, three, or even four meetings to win compare with deals that take only one meeting.
Based on this, we can identify which opportunities would benefit from an additional meeting, to help our salespeople make better use of their time and create a higher chance to increase the ACV.
4. Win/Paper Sent
Enterprise sales teams face not only longer sales cycles, but asymmetric ones, too. As talks progress and teams edge closer to a deal, negotiations can actually become more complex and time-consuming.
The win/paper sent ratio is the number of closed-won deals divided by the total number of contracts sent. This KPI captures how efficient (or not) late-stage negotiations have been. Imbalanced ratios can reveal potential problems in late-stage discussions.
With elongated sales cycles, more stakeholders, and greater scrutiny, many factors that can impact later-stage negotiations are beyond a sales rep’s control. Identifying potential roadblocks is a vital first step in determining what reps and AMs can do to optimize their discussions with prospects and close deals faster.
5. Average Selling Price (ASP) and Product Mix
Not all products are created equal. It’s not enough for sales leaders to focus on ratios of total deals won or average sales cycle duration. It’s also important to examine the average selling price (ASP) as it relates to the product mix.
Take Adobe, for example. Between 2018 and 2022, the value of Adobe’s digital media solutions (including its flagship Creative Cloud) was approximately three times greater than its digital experience offerings. While both categories experienced similar, consistent growth during that period, Creative Cloud is a significantly more valuable product. Selling all their products in the same way wouldn’t make sense for Adobe.
If reps are closing larger deals, but relying on extensive discounting or promising additional access to smaller products or services, they may need to simplify their approach. Focusing on the valuable core product, rather than resorting to deep discounts or excessive bundling to close a deal, could actually drive higher revenue over the long run, with a much less complex sales process.
6. Customer Value at Maturity
As businesses cultivate relationships with their customers, they often see increased value over time as product ecosystems become integrated into tech stacks or internal processes. This can have a significant impact on forecasting, as large enterprise customers can prove increasingly lucrative over longer contract periods.
To understand the customer value at maturity of a prospect, assess their potential value as defined by the ACV at the three-year and five-year mark for a comparable business in terms of industry, total headcount, and other firmographic attributes. Then analyze that value against individual account executive and account manager performance for those types of companies.
For example, at ZoomInfo we track what a given team has been able to historically close against specific types of companies at a certain dollar figure. If individual AEs and AMs are consistently closing below that benchmark, team leads share that feedback and explore why those deals are closing lower, as well as which companies in their book have the greatest upsell potential.
7. Seller Productivity by Tenure
Data from Salesforce suggests that a majority of sales reps move on to other roles within 12 months, confirming the urgency with which sales leaders must ramp up new hires. To further complicate matters, data from Gallup indicates that it also takes an average of 12 months for employees to reach their full potential.
As a result, one of the greatest challenges faced by sales leaders is gauging when specific reps are ready to accept more responsibility and be assigned higher-value leads. It doesn’t make sense to give new team members revenue targets that match more experienced sellers, doing so risks missing targets and demoralizing new hires.
According to Iannarino, it’s important to consider how salespeople can and should improve over time, especially as their familiarity with products, industries, and sectors deepens as they gain experience.
“Over time, the salesperson should get better and more productive,” Iannarino says. “Simply because I sell the same thing every day and I’ve had that buyer’s journey so many times — hundreds of thousands of times — and the buyer only buys every five years.”
Examining seller productivity by tenure can yield valuable insights into how much new-business or upsell revenue reps can expect to achieve in a given period. Ideally, calculating seller productivity by tenure should be done in cohorts, rather than examining individualized performance data. This enables sales leaders to set realistic, achievable targets for both new and experienced sellers, and create feasible onboarding and ramping plans.
ZoomInfo did something like this when we refactored our lead-routing model to assign higher-quality leads to more experienced salespeople — an experiment that resulted in significantly higher win rates.
“Before, we never factored in channels, even though we knew that leads from our website are the best leads,” says Steven Bryerton, senior vice president of sales at ZoomInfo. “Now, that’s a major component of the model and how leads are routed to specific reps, regardless of a prospect’s size. That starts to trump some of those other data points when it comes to how we assign leads.”
Enterprise Sales Has Changed
The rules of enterprise sales are ever-changing and competition for new and existing business is always intense. Customers are becoming more discerning and engaging salespeople much later in the buying process. Investments in new technologies are under increasing scrutiny, and even products that demonstrate real value can be a tough sell for cautious companies examining their budgets.
However, constant change also brings new opportunities for forward-thinking businesses. ZoomInfo has helped some of the world’s biggest, best-known brands, including PayPal, Snowflake, and Unilever, reach new audiences and achieve strong, sustainable growth.
Sign up for a free trial of ZoomInfo and learn how we can help your company sell smarter and win faster.