How product managers can optimise sales performance with data, strategy

By Oluwaseun Adeoye

Success in product management encompasses most aspects of product performance in the marketplace. Indeed, user feedback and such metrics as user engagement and feature usage are essential considerations, but sales are still the most tangible and direct measure of a product’s success. Thus, sales performance raises product manager concerns from just the revenue point of view to what drives sales, spotting chances for growth, and making data-driven decisions to improve product and go-to-market strategies.

Defining the right metrics is one of the first steps in sales performance monitoring. Without a keen understanding of sales data, one can quickly become overwhelmed and lose focus. KPIs like monthly recurring revenue, customer-acquisition cost, lifetime value, and conversion rates offer a framework for building performance evaluation. Tracking monthly recurring revenue (MRR) gives the product management team ground to understand the consistency and growth of revenue over time; analysis of customer acquisition cost (CAC) and lifetime value (LTV) shows the efficiency of marketing efforts and the profitability of a customer is expected to yield over his lifetime. Through the lens of metrics like these, product managers begin to forge a holistic view of sales performance and its weaknesses.

Data visualization tools make it feasible to read sales data. With them, a product manager can do more with Tableau, Power BI, or Google Data Studio by creating interactive dashboards displaying the most relevant metrics in real time. These tools simplify tracking sales performance and make it easy to spot trends and opportunities. A sudden drop in conversion rates might denote a grievous fault in the checkout process, whereas a spike in sales in each area could indicate a successful campaign. Visualizing data in this way would facilitate this pattern detection-and-action effort.

Cohort analysis is an advanced technique to monitor selling performance. Generally, customers to be analyzed may be grouped concerning a common characteristic (i.e., their month of first purchase or marketing channel from which they came) and analyzed over time. Cohort analysis can reveal some facts that aggregate metrics would otherwise miss. One possible insight would be whether customers brought through a specific campaign show higher retention or if a new attribute has affected purchasing behavior among recent cohorts. Such insights help the product manager improve strategies and make more informed budgetary allocations.

Data integration across systems has its perks for monitoring sales performance as well. While most companies will have different pieces of the customer relationship management suite tagged with bits of marketing automation and e-commerce, these systems usually collect quantities of instrumental data. APIs and integration platforms such as Zapier or MuleSoft can join such platforms and give a more holistic view of sales performance. Combining sales analytics with data from CRM can provide product managers with an understanding of how customer interactions drive purchasing decisions. The complete circle provides an unbiased picture based on all-inclusive data instead of mere metrics.

A/B testing is one means by which product managers can enhance sales performance. By testing several product page versions, pricing models, or marketing communications, product managers can screen which options sell best. Suppose an online merchandising company wishes to examine two different checkout flows and determine which version creates a higher conversion rate—as with most companies, which would be much healthier via the route of A/B testing. Evidence-based decisions supported by experimentation reduce guesswork and assumptions.

Tracking sales performance involves tools and techniques, but the organization must imbibe a culture of responsibility and collaboration. One’s sales performance is due to various factors, from product design to market pricing and product support to customer support. Product managers must engage in cross-functional interaction to align goals, share insights, and decide on changes. Regular performance reviews, collaborative planning sessions, or the entire range of already mentioned interventions will help make sure that all are working toward the same objectives and that sales performance will remain under focus.

One challenge that product managers must endure is often that reconciliation between goals for short-term sales and long-term product strategy—well, short-term gains will always tempt one into thinking that discounts or promotions are commonly ineffective in the long run, i.e., they may have short lives. Product managers should find balance in putting money into strategies that yield quick results and those that bring growth over the years. Good examples would be that improvements in onboarding may not drive sales overnight, but giving customers a better experience of satisfaction will increase retention and lifetime value.

So, what do product managers do to monitor and optimize sales performance? Set clear KPIs and use visualization tools to track the KPIs in real-time. Cohort analysis and A/B testing will bring more insights into refining strategies—data integration across systems to get the whole picture of sales performance. Create a culture for collaboration and accountability so sales goals align with the overall product vision.

Monitoring sales performance indeed requires lots of activity, learning, and improvements all the time. With the right tools and techniques, product managers can get answers or solutions to sales increases, customer satisfaction, and the future. In a highly competitive market, the difference between great product managers and great product managers is in their ability to monitor and optimize sales performance. Selling a product is not entirely what defines being a great product manager; even the great ones would assert that although selling a product has value, it is the value that stays with customers for a long time that matters most.

READ MORE FROM: NIGERIAN TRIBUNE