Let's now focus on pipeline conversion metrics. The conversion rates (CVR) to won revenue –- both by who generated the pipeline and the channel or source –- are important know so that you can optimize your efforts and resources to achieve the right plan and balance for pipeline creation.

CVR is calculated by looking at the amount of pipeline generated that was won from the total amount of pipeline generated in a specific time period.

For example: $100,000 of pipeline was generated in January by the sales team, and of that specific pipeline, $25,000 was won in any time periodt that followed, the CVR would be 25%. Note that as time progresses the CVR will increase until all the pipeline generated from that specific time period is either closed won or closed lost. Tracking conversion rates monthly, or even using a rolling time period such as 30 days, will help to identify both seasonality and signals that indicate trends that may impact future revenue attainment.

See examples below showing ways to track by role or by channel/source:

Shown in the tables below, even with the same amount of pipeline generated, if the actual mix and or conversation rates deviate from plan, the amount of won revenue will vary. It should be expected that these will vary month-to-month and quarter-to-quarter. When they do vary, the combination of the deviations may still lead to a path to achieving or even exceeding your revenue target. But if not, a path needs to be mapped out, along with actions, to achieving the target.

When Marketing plans for its budgets and programs, it is critically important that they look at not just pipeline creation but also pipeline conversion to closed won. This is because pipelines created across sources do not have the same characteristics. It varies by cost/pipeline $ created, velocity, ASP and CVR or win rate. Many refer to these qualities, which we will discuss in an upcoming KPI Wednesday post. Only by modeling and measuring each of these individually, then determining the right mix of spend vs risk against your business objectives can an aligned revenue plan be constructed and managed.

See how Revcast can help you automatically track these Pipeline KPI metrics in real time -- but go even further by giving you AI analysis recommendations to optimize your current GTM plan so that you stay on track to hit your revenue targets for the year. Request a demo.