A Scientific Approach to Sales
In this lesson, we’ll dive into how we can take a scientific approach to sales.
What could you do today to increase your sales by 10%?
Hidden somewhere in your sales data is the answer to how you can immediately increase your sales revenue by 10%.
The purpose of these lessons are to show how a scientific approach to sales can give you the power to not just uncover where you’re leaving money on the table, but also how you can measure and grow your sales in a consistent and repeatable way.
Where should I focus my effort?
In sales, there are a lot of moving parts. Your job as a sales leader is to figure out which parts you should focus on to reach your sales revenue goal.
If you don’t have a reliable way to predict how much return you can get for your investments, you’re leaving your sales up to luck.
So what’s your approach for getting the luck out of sales?
Where good ideas come from
An experienced sales leader likely has many ideas for how they might increase sales quickly, as they’ve recognized patterns of what works and what doesn’t from years of experience.
Similarly, a data-driven sales leader also relies on pattern recognition to come up with ideas, but they take a disciplined approach of analyzing their sales data at scale in order to uncover key patterns and better predict exactly where they would get the best return for their time and effort.
So how do they do this?
Apply the scientific method to sales
This data-driven approach to sales is rooted in the discipline of the Scientific Method. It goes as follows:
What questions do you want to explore and what are you observing in your data?
What is influencing the patterns you’ve observed to occur?
03. Formulate Hypotheses
What are the general causes of the phenomenon?
04. Develop Testable Predictions
How can you test and measure your hypotheses?
05. Analyze Data to Test Predictions
How do the results prove/disprove your predictions and what can you do with the results?
Example of a scientific mindset
Imagine for a moment that you’re a school teacher with the task of increasing your students’ grade point average from a B- to an A in a quarter. What would you do?
A scientific approach to this challenge would start by questioning and digging into the “average.” For instance, you could break out the performance of individual students and explore why some students fail while other succeed.
Which factors could be causing this variability? What kind of data would be helpful to figure out how to improve performance across the board?
Can you find variability in your sales performance?
Similarly, if you have to increase your sales by 10%, how would you start exploring your sales data to figure out what to do?
If you look at your sales funnel (a visual representation of your sales pipeline), what are the different ways you could start identifying variability in your sales performance?
To observe variability in your sales performance, consider looking at your sales from different perspectives.
Data is combined to present an overall summary or report of performance and trends that would not be observable in disaggregate data sets.
Data is broken out by a dimension (e.g. by team, by industry, by time, etc.) to reveal underlying trends, patterns, or insights that would not be observable in aggregated data sets.
Let's take a look at these two perspectives in action to uncover different patterns and variabilities using some sample sales data.
INTERACTIVE EXAMPLE #1
Total Sales vs. Forecast vs Goal (Aggregate View)
When you look at a chart like “Total Sales vs. Forecast vs. Goal,” what are you trying to observe? What questions come to mind that can help you identify different ways you can dig deeper into your sales data?
Create your own “Total Sales” report using this template and guide to discover these answers.
Available in Keynote, PowerPoint and PDF file.
INTERACTIVE EXAMPLE #2
Quota Attainment by Team (Dimensional View)
When you look at your total sales by the dimension of different sales teams, what do you see? Even if your total sales are performing well in aggregate, are there areas where performance is variable and unpredictable? Can you explain why that variance occurs?
Available in Keynote, PowerPoint and PDF file.
Lesson #1 Summary: A Scientific Approach to Sales
Analyze your sales from multiple angles to identify new ways to increase your sales. Being able to observe variability in your sales performance is the jumping off point to researching and understanding exactly what’s going on with your sales performance and how you can make a measurable impact.
The Sales Formula
In this lesson, we will show you the “Sales Formula” every company needs to analyze their sales performance effectively and finds ways to improve it.