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1. BBC 2213
CUSTOMER RELATIONS MANAGEMENT
Week 12
Continuing Improvement
(Performance Measures)
Azni B. Abdul Rashid

2. Performance Evaluation
•Final phase of a CRM project
•Two sets of variables can be measured:
✔ project outcomes
✔ business outcomes/benefits realized
▪Project outcomes - whether the project has been delivered on time
and to budget.
▪The business outcomes or benefits require us to return to the project
objectives, our definition of CRM success, and the business case and
ask whether the desired results have been achieved.

3. Performance Evaluation
•Example: If the single goal was to enhance customer
retention rates, with a measurable lift from 70% to 80%, and
this is accomplished, then your CRM project has been
successful.
•Most projects have multiple objectives - common for some
objectives to be achieved and others to be missed;
Ex.: Lead conversion by the sales team might rise but lead
generation by campaign managers might fall short of
objective.

4. Performance Evaluation
▪A critical issue concerns the timing of any business performance
evaluation.
✔ It can take users several months to become familiar with new
processes, and competent in using new technology.
▪Periodic measures of business outcomes can be taken over time, to
ensure that the programme outcomes are achieved.
▪Ongoing training, timed to coincide with software upgrades, can
enhance business outcomes.
▪In the short term: impossible to assess whether the latent benefits
specified in the business case have been achieved.

5. How to Measure CRM Success
by Rachel Burns (2019)
• How do we know if our new CRM system is working?
→ If it isn’t…..
▪ Sales doesn’t have the information or tools they need to convert
marketing leads
▪ Leads stall at certain parts of the sales cycle, fall through the
cracks, or take way too long to close
▪ Customers don’t stick around
▪ Marketing, sales, and customer support don’t share information
or insights with each other
▪ Your customer support team works overtime, but can’t get
through all of the tickets
• But without waiting to see if any or all of that happens, how can you tell?
→ By tracking CRM metrics

6. Performance Metrics
• Metrics are numbers that tell us whether something’s working the way it should. CRM
affects teams and goals across our business — so we need to know it’s working!
• In this post, we’ll learn how to:
• Set measurable goals
• Determine how well we’re closing valuable deals with sales metrics
• Figure out if we’re marketing the right message to the right people with marketing
metrics
• Learn how well we’re meeting customers’ needs with customer service metrics
• Run the right CRM reports to measure success

7. Set measurable goals
•“What gets measured gets managed.” – Peter Drucker, The Price of
Management (1954)
•To measure CRM success, we need to set SMART goals:
• Specific
• Measurable
• Achievable
• Relevant
• Timely
•Setting measurable goals upfront makes it easier to measure the
effectiveness of our CRM later on.

8. Set measurable goals
•To make goals measurable, we need to assign key performance indicators
(KPIs) to each. A key performance indicator is a quantifiable measure a
company uses to determine how well it’s meeting its goals.
•KPIs tell us:
• If our CRM strategy works
• If we’re on track to meet our CRM goals
•If our goal is to increase customer retention, we wouldn’t measure the
number of open sales opportunities. If our goal is to shorten our sales cycle,
we wouldn’t measure our email list growth rate.

9. Sales Metrics
•How well are we closing valuable deals?
•What does sales success look like for a business?
•Here are 5 metrics to measure sales team performance and
CRM success:

10. Sales Metrics: (1) Close Rate
• Close rate: the number of deals closed compared to the number of leads in the
pipeline.
Ex. If you have 100 leads in your pipeline and only 10 close,
your close rate is 10%.
• Most sales teams use close rate as a measure of success — but close rate alone
doesn’t always tell the whole story.
• What is the missing information?
• Business A closes 75% of their deals.
• Business B only closes 5% of their deals… but makes more money. How?!
• Higher average deal size. Make sure to look at average deal size alongside close
rate. How much are our closed deals actually worth?

11. Sales Metrics: (1) Close Rate
•Compare the close rate for the six months leading up to the
implementation of a new CRM system with the six months after. If
the CRM is doing its job, the close rate should increase.
•If it decreases, it is time to take a closer look at your sales team
productivity and the quality of your leads.
“Alec Baldwin is in this movie for 15 minutes, and they’re all
incredible.” – Ernie Santeralli

12. Sales Metrics: (1) Close Rate
•Anthony Iannarino is an international speaker and sales leader, the
author of The Lost Art of Closing and The Only Sales Guide You’ll Ever
Need.
•His advice to salespeople looking to get more productive is:
“Spend the very first hour on prospecting. There is nothing more
important to being productive than creating new opportunities.
Productivity in sales is measured in opportunities created and won.
Everything else is necessary but not sufficient to generating the
outcomes by which productivity in sales is measured.”
•If you don’t prospect well, lead velocity will slow down. You’ll waste
time on worse leads – and run out of the great leads you need.

13. Sales Metrics: (2) Upsell rate
• Upselling: Convincing the customer to spend more than they originally planned. The
upsell rate is how many customers buy things that they weren’t originally planning
to buy.
• Let’s say we run sales for a home cleaning company. Upselling might involve selling
customers:
• A year’s worth of monthly cleaning, instead of purchasing month-by-month
• Deep cleaning services instead of the basic option
• If you convince 1 out of every 5 customers to upgrade their purchase, your upsell
rate is 20%.
• A CRM can help increase your upsell rate by helping you predict which leads are
most likely to upgrade or buy other products. If finding predictors increases the
upsell rate, then your CRM works.

14. Sales Metrics: (3) Net-new revenue
•New revenue means spend from new customers.
•How long a customer stays “new” depends on the business model.
• If we sell yearly subscriptions - revenue generated by customers within
their first year.
• If we sell one-time products, revenue generated by customers’ first
purchases.
•Why measure net-new revenue?
→ It tells us how much money the sales team is making.
→ Tracking new revenue and close rate tells us how valuable the newest
batch of customers is.

15. Sales Metrics: (3) Net-new revenue
•What can we do with the right CRM in place?
• We should be able to identify more high-value deals
• We should be able to close more high-value deals
• We net-new revenue should steadily increase
“This is you calculating your net-new revenue. But you should
probably ask a little more nicely.”

16. Sales Metrics: (4) Length of Each
Pipeline Stage
• How long does the average lead stay in each stage of your pipeline?
• Stages are the steps of our pipeline (or sales process). Tracking stages helps us find
bottlenecks in our sales process, ex., deals tend to get stuck in a certain stage).
• Let’s say leads stay in the proposal creation step 10x longer than any other step.
Sure, creating proposals takes time, but how can we help the sales team move these
leads to the next step more quickly?
• Is there a way to automate some of the proposal creation process?
• Do you have proposal templates?
• If so, are they easy to use (and is our team using them)?
• The more effective our CRM system, the faster deals move through each stage of
your pipeline. Which brings us to…

17. Sales Metrics: (4) Length of Each
Pipeline Stage
• Is there a way to automate some of the proposal creation process?
• Do you have proposal templates?
• If so, are they easy to use (and is the team using them)?
•The more effective our CRM system, the faster deals move through each
stage of your pipeline. Which brings us to…

18. Sales Metrics: (5) Length of Sales Cycle
•Also called lead velocity, it measures how long the average deal takes
to close.
Ex. If a lead’s first conversation with the sales team is in early
January, and they make a purchase or sign a contract in early July,
the sales cycle is about six months long.
•These two factors play a big role in length of sales cycle:
• Number of decision makers involved
• Cost of product or service
•The more people involved in the decision to purchase, the longer it will
take to close. Same goes for price: the more expensive the product or
service, the longer the sales cycle.

19. Sales Metrics: (5) Length of Sales Cycle
•Those factors are out of the sales team’s control. But we want to
speed up the sales process and close deals more quickly.
•Which is exactly what CRM software was made for;
•CRM makes your sales process more efficient, meaning we can sell
more in less time.
•Keep an eye on this metric over time as a way to measure CRM
success.

20. Marketing Metrics
▪Are we marketing the right message to the right people?
▪Is our marketing team making the most of CRM?
▪Here are 5 metrics we can use to measure marketing success:

21. Marketing Metrics:
(6) Customer Lifetime Value (CLTV)
• This metric predicts how much revenue you can expect from a single customer
account.
• To calculate CLTV, you need 4 pieces of information:
• Average purchase value: The company’s total revenue over the course of a
year divided by the number of purchases that year.
• Average purchase frequency rate: The number of purchases over the course
of a year divided by the number of unique customers who made purchases
that year. This tells us how many times per year the average customer buys
from you.
• Average customer value: The average purchase value multiplied by the
average purchase frequency rate. This estimates how much money the
average customer spends with us per year.
• Average customer lifespan: How long the average customer continues to
purchase from our business.

22. Marketing Metrics:
(6) Customer Lifetime Value (CLTV)
•Once you have all the above info, multiply average customer value
by the average customer lifespan. Voila!: our company’s average
CLTV.
•The right CRM helps you:
• Increase the average customer lifespan by improving retention
and satisfaction
• Target more high-value leads through your marketing
•When our customers spend more and stay longer, your CLTV goes
up.

23. Marketing Metrics:
(7) Customer Acquisition Cost (CAC)
•Your CAC is the total sales and marketing spend required to close a
customer:
CAC = Total Acquisition Spend / No. of Customers Acquired
•Fact: Every single marketing team wants to decrease CAC. Closing
more deals while spending less money?
•Effective CRM helps you lower your CAC by:
• Targeting more qualified leads
• Automating sales and marketing tasks
•Targeting more qualified leads, we close more deals. Automation
makes the marketing team more efficient, which saves time and
money.

24. Marketing Metrics:
(8) Revenue Generated by Campaign
•How do we know that our email marketing campaigns work?
•We’re getting clicks and the unsubscribe rate is low, but how does a
series of emails contribute to your company’s bottom line?
•The goal for (almost) all email campaigns: to convince people to buy
from us.
•Breaking down how much we make from each campaign can help you
identify what resonates with our customers. This lets us test and
improve: email length, calls to action, subject lines, images, “From”
field, number of emails in the campaign, etc.
•CRM gives insight into customer behaviour and preferences - send the
right messages to the right people.

25. Marketing Metrics:
(9) Email List Growth Rate
•Measures how much our email list grows over a certain time period
•To calculate email growth rate:
• Subtract the number of unsubscribes from the number of new
subscribers
• Divide by the total number of contacts on your list
• Multiply by 100
•The CRM helps our marketing team increase this metric with:
• More opportunities for opt-in forms (pop-ups, gated content, etc.)
• More targeted emails → fewer unsubscribes

26. Customer Service Metrics
•How well are we meeting our customers’ needs?
•We might think of CRM as a way for sales and marketing to gain new
customers — but it can also work wonders for keeping our existing
customers happy.
•Here are 4 customer service metrics to measure:

27. Customer Service Metrics:
(10) Net promoter score (NPS)
• How likely are our customers to recommend our business to someone else?
• To measure NPS, we need to send customers a survey with some variation of
these questions:
• On a scale of 1 to 10, how likely are you to recommend our company to a
friend or colleague?
• What made you choose that score?
• Respondents are broken into three categories:
• Promoters (9-10): People who are really pumped about what your
business has done for them (and want to shout it from the rooftops!)
• Passives (7-8): People who get what they want from your business, but
aren’t particularly excited about it
• Detractors (0-6): People who had a less-than-great experience and are
likely to switch to a competitor

28. Customer Service Metrics:
(10) Net promoter score (NPS)
• What does NPS have to do with CRM?
• CRM helps personalize the customer experience, which makes people happier
• CRM keeps all customer info in one place, letting us see a customer’s NPS and how it
changes over time
• CRM lets you automate sending out NPS surveys and reporting on the findings.
• One caveat of NPS…
• NPS is not a strong indicator of retention
• NPS rarely correlates with churn
• To predict churn and revenue, look at our financial and retention metrics.
• Patrick Campbell of ProfitWell: “NPS is still useful, but likely only as a framework for
identifying those customers on an individual basis who are raising their hands in
frustration.”
• NPS really shines: a pulse check at the account level, regularly collecting customer feedback
helps us address customer frustrations and stop would-be bad reviewers in their tracks.
• Use NPS to find the biggest potential brand advocates – ask for review or customer story

29. Customer Service Metrics:
(11) Churn Rate
• The dreaded churn – churn rate of a organisation
• This metric tells you how frequently customers leave. To calculate churn rate, divide
the number of churned customers by our total number of customers.
• 68% of customers who churn do so because they believe we don’t care about them.
• CRM makes it easier to prove that we do - track customer interests, activity, and
interactions, then use that information to:
• Send personalized emails based on previous purchases
• Ask for customer feedback
• Reward customers for hitting certain milestones
• The more appreciated and listened to our customers feel, the more likely they are
to stick around.
• Another way to lower churn with CRM: look at accounts who have churned in the
past. What do they all have in common? Keep an eye on indicators that a customer
might churn, then work with at-risk accounts before it’s too late.

30. Customer Service Metrics:
(12) Average Time to Resolution
• The right CRM system should lighten the team’s workload and help them
serve customers more efficiently.
• Average time to resolution: How long does it take for the customer service
team to resolve the average support ticket after it’s been opened?
• (Pro-tip: Measure this metric in business days or hours so that it doesn’t
factor in off-hours.)
• Look at our overall average time to resolution, then drill down to a
rep-by-rep level. If certain reps take way longer than others to resolve
tickets, make sure they have the right tools and training they need.
Analysing this metric can help you figure out where certain reps might be
struggling.
• If CRM works (and our team knows how to use it), the average time to
resolution should decrease. We’ll get into the “why” in just a minute, but
first…

31. (13) Average Number of Follow-ups
per Ticket
• How many call-backs or emails does it take for the average issue to be
resolved?
• This dives a little deeper than the average time to resolution. It doesn’t take
into account how quickly the rep or customer replies. Instead, it measures
how effective the responses are.
• How can CRM help you lower these two metrics?
→ Make sure the support team gives customers the most relevant and
tailored info the first time around.
→ CRM software makes it easy to see everything about our customer —
behaviour, preferences, activity, previous support tickets — in one place. Use
it! Incorporate this information into the solutions we offer customers. The
more background your customer service team has, the better (and faster)
they can help our customers solve their issues.

32. Run the Right CRM Reports
to Measure Success
•Use these CRM metrics as a starting point — Choose the KPIs that
measure the things we want to improve.
•KPIs should tie closely to the goals we set as part of our CRM strategy
— why did we put this new CRM system in place originally? Make sure
we’re measuring how well we’re meeting those original needs.
(SMART goals)
•Once we know what we want to measure, we need to figure out how
to measure it. Many CRMs offer built-in reporting that lets us track the
sales, marketing, and customer service metrics we just ran through.
•Here are 4 popular CRM reports we can run to measure some of the
chosen metrics:

33. Run the Right CRM Reports
to Measure Success
1. Sales Forecast Report: uses the lead data and sales trends to predict
future revenue.
• Example: ActiveCampaign CRM - use win probability to take
revenue prediction one step further. Win probability uses machine
learning to analyse hundreds of factors, then predicts how likely
you are to close a certain deal.
2. Sales Conversion Report
•Tells us what percentage of leads convert within a certain date range
— aka your close rate.
•This report can be broken down by lead source to see where these
leads came from - inbound leads close vs. outbound leads; leads from
social media vs. organic search?

34. Run the Right CRM Reports
to Measure Success
3. Sales Performance Report
•Gives a leaderboard view of the sales team’s current and historical
performance.
•Example: In ActiveCampaign’s Deals CRM, we can view:
• Sales performance metrics - total deal value, total number of deals,
and average deal value
• Bar graphs depicting the deal value by stage and number of deals
for each sales representative on the team
• A table of each deal in a pipeline with deal owner and deal value
Deals sorted by Deal Status (Open, Won, or Lost), Currency, or
Pipeline

35. Run the Right CRM Reports
to Measure Success
4. Lost Deals Report
•Analysing our wins feels great, but don’t forget to learn from our
losses, too. Finding out why someone said ‘no’ to our business can be
even more important than knowing why someone else said ‘yes.’
•A lost deals report shows us which deals our team didn’t close — and
why. Use this report to:
• Find common reasons that leads fail to close
• Figure out how to handle those objections from other leads as they
come down the pipeline

36. The (Success) Story is in the Data
•“Data, I think, is one of the most powerful mechanisms for telling
stories. I take a huge pile of data and I try to get it to tell stories.” –
Steven Levitt, Co-author of Freakonomics
•Measuring the right metrics can be the difference between a success
story and a cautionary tale. If we know how to measure our CRM
success, we can keep track of how close we are to reaching our goals.
•If we find yourself off-track, be willing to test different ways of using
CRM to meet your business goals.
•Try something new, measure the results, rinse, and repeat.

37. UNIVERSITY
“The thing being made in a university is humanity ......What
universities...... are mandated to make or to help to make is
human beings in the fullest sense of those words - not just
trained workers or knowledgeable citizens but responsible
heirs and members of human culture ....Underlying the idea of
a university - the bringing together, the combining into one,
of all the disciplines - is the idea that good work and good
citizenship are the inevitable by-products of the making of a
good - that is, a fully developed human being "
Wandel Berry, The Loss of the University