When you have to make important company decisions do you make decisions based upon data or just upon predictions?
Many times, your company’s success and failure highly depend on how smartly you make business conclusions established on accurate, data-driven sales forecasting.
Let’s take a look at some of the essential statistics:
- A research study by Aberdeen Group showed that companies who use factual sales forecasts saw an increase of 10% in annual revenue.
- About 74% of B2B companies use sales forecasts weekly.
- A research study from Mckinsey showed that companies who make decisions based on data saw an increase of 15%-20% return, with the addition of 5%-6% profit than their opponents.
All this shows how important it is to make important decisions based on data instead of relying on guesswork.
To make good decisions, you will have to collect accurate sales data, analyze it and make your choices accordingly.
How can you make good company decisions using sales forecasting?
Using AI to predict, analyze data and make decisions accordingly is the most common use-cases of machine learning and AI. AI is transforming sales by providing the data to forecast and make precise decisions. The sales data gives you a precise picture of what your sales look like for a given period.
By correlating your customer’s interaction data (phone calls, emails…) to real sales outcomes, the sales forecasting software can anticipate upcoming revenue with a certain amount of precision.
When an AI-powered sales forecasting tool accurately predicts future revenue and early risks, the collected information manages the workforce and distributes resources accordingly. It also helps your company to be more efficient and responsive to transforming market circumstances.
The sales forecasting tool can provide its insights in three main areas:
Improving pipeline management and lead scoring
The sales forecasting tools help in analyzing sales pipeline like study transactional, demographic, and customer interaction data, which helps separate leads depending upon how profitable and engaging they are in your pipeline.
Based on the sales forecasting tool, you can create a contact list of profitable prospects, and you can only contact those who are interested in learning more about your products. The tool also helps you recognize any weak points of the sales funnel that are dropping out of the pipeline, and you can fix it up to avoid any such happening in the future.
The sales tool can help you find the big client’s where you have a big chance of getting high retention rates. You can focus on satisfying your big prospects to assist in getting high retention rates and satisfied clients.
Research conducted by Esteban Koisby mentioned that 67% of customers report poor experiences as a reason for churn; however, just 1 out of 26 customers complain about their unhappy experience.
The sales forecasting software helps you to recognize the significant reasons for churn so that you can point out those contacts and work actively to solve their issues and avoid them getting churned. The sales tool also helps you to identify the contacts that have signed for the trial period and haven’t started using your product for some reason. Then, you can ask them if they have any problems, and you can solve any issues they have, educating them about your product and moving them ahead in the buyer’s journey.
Helping in improving performance management
The sales forecasting tools can also help you with performance management. A study by Aberdeen Group mentioned that companies who use sales forecasting tools have 7% more chances to hit the quota. Sales forecasting tools use performance data and sales team activity to figure out performance issues, motivate your team, set realistic goals, and reward top members. By looking at the sales team’s past records, AI can predict how they will perform and who will achieve their goals. The sales tool can also help in identifying any room for improvement for each salesperson and give feedback and suggestions to improve the opportunities of locking the deals. The Salesforce’s State of Sales report stated that around 62% of sales reps expect AI to revamp Guided selling in the next few years.
The sales forecasting tool can only be used properly if you’re adding sales data into it.
There are many benefits of using sales forecasting tools. But the sales team doesn’t see any value in collecting the data and adding it to the CRM software. On top of that, entering data into the sales team is time-consuming and tedious, which many people don’t have the time to do.
Adding incomplete and inaccurate data at all is unreliable as not feeding any data into the CRM. Moreover, it’s time-consuming. So, to save up time and add accurate data into the software, you will have to make the whole process automatic which you can do with any reliable sales tool.
In different industries, especially in the sales department, making important decisions using forecasting tools allow the company to grow correctly and remove any obstacles if they have any. The AI-powered sales forecasting tools let us dig deeper into the sales activity, analyze the numbers and make smart decisions.