Revenue operations metrics

When an organization’s sales, marketing, and customer success teams are aligned, they’re in a position to drive consistent and predictable revenue. They achieve that alignment through the framework of revenue operations. RevOps is a highly metrics-driven business function that collects and analyzes data from across the organization, producing actionable insights for optimizing revenue-generating operations.

Read more about revenue operations metrics below.

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Revenue operations metrics

When an organization’s sales, marketing, and customer success teams are aligned, they’re in a position to drive consistent and predictable revenue. They achieve that alignment through the framework of revenue operations. RevOps is a highly metrics-driven business function that collects and analyzes data from across the organization, producing actionable insights for optimizing revenue-generating operations.

For decades, sales, marketing, and customer success teams have primarily worked in silos, with their own resources, channels of communication, processes, metrics, and data. RevOps represents a move to the other end of the spectrum, where collaboration and shared success are prized.

In fact, Gartner predicts 75% of the highest-growth companies in the world will deploy a RevOps model by 2025. Tracking the right RevOps metrics can have an outsized impact on the success of the alignment and optimization initiatives. This blog will illuminate the key metrics for measuring RevOps, and the benefits of implementing a RevOps model/framework.

Revenue operations, defined

A revenue operations team is tasked with aligning sales, marketing, and customer success. When these teams’ functions are undertaken in coordination with each other and make use of shared data and common processes, they are more likely to lead to predictable revenue growth. Effectively aligning these teams reduces the chances of duplicate efforts, competing goals, contradicting data, and compromised revenue.

Sales, marketing, and customer success clearly complement each other. Without marketing’s work to generate and qualify leads, for example, sales numbers would likely decrease. When sales and customer success work together to develop positive, long-term customer relationships, that goes a long way toward increased customer retention (and lifetime value).

Revenue operations vs sales operations

The simplest way to distinguish between RevOps and sales operations is in their scope. Sales Ops focuses on optimizing sales processes to maximize departmental efficiency and increase results. While sales operations is typically aware of the organization’s overall revenue picture, its day-to-day focus is on the sales numbers.

In contrast, RevOps considers sales metrics in addition to (and in the context of) marketing and customer success metrics. While RevOps does understand Sales Ops metrics such as net-new revenue, its focus is on metrics such as gross revenue.

Revenue operations vs business operations

To differentiate between RevOps and Business Ops, think of RevOps as just one piece of Business Ops. While RevOps maintains a focus on the well-being of revenue-generating operations by considering the customer life cycle (from marketing to sales to customer success), Business Ops takes an even wider view: the entire business lifecycle, or the business’s projected ability to consistently make money.

For example, while a Business Ops team might not work directly with sales, marketing, and outward-facing service teams to grow sales, it serves in a strategic, tactical role that supports RevOps. Additional teams that may be included under the Business Ops umbrella (but not RevOps) include finance, production, accounting, human resources, legal, and IT.

Revenue operations responsibilities

Revenue operations responsibilities include the overseeing and organization of sales, marketing, and customer success teams to drive revenue growth. To that end, RevOps is a metrics-driven endeavor. By tracking the right marketing, sales, and customer success data — and establishing a solid revenue operations team structure and framework — RevOps can optimize virtually every aspect of revenue generation.

Revenue operations team structure

Before RevOps, the organizational charts of selling companies would typically be aligned in three columns: The marketing arm of the business would report to the VP of marketing; Sales Ops would report to the VP of sales; and customer success would report to the VP of customer success. This organizational scheme works for many companies and is still quite common.

revenue-operations-chart-organizational

As you can see in the image above, RevOps is a move away from the “siloed ops” approach. Here, there would be four vice presidents: Marketing, sales, customer success, and RevOps would each have a top figure. Relevant roles and responsibilities fall under each VP’s position, and those team members would report to the VP.

When you compare the two structures illustrated above, it becomes evident which would foster better collaboration and accountability. RevOps minimizes confusion and competition, building a superteam ready to achieve its objectives.

Below is an example of what the ideal executive structure for RevOps might look like: executive-structure-ideal

Revenue operations job titles

Even though the concept of RevOps may be relatively new to some organizations, forward-thinking companies have been defining their own versions of a revenue operations career path by thinking through a hierarchy or chain of command. Building a revenue operations team begins with finding both entry-level contributors and qualified managers who operate under the guidance of executive leadership.

Some entry-level jobs in revenue operations:

  • Business intelligence analyst
  • Revenue accountant
  • Revenue operations analyst
  • Revenue operations specialist

Manager-level RevOps positions:

  • Data manager
  • Revenue cycle manager
  • Revenue operations manager

Director- and executive-level RevOps roles:

  • Chief revenue officer
  • Director of revenue accounting and strategy
  • Director of revenue operations
  • VP of revenue accounting

Revenue operations manager responsibilities

A revenue operations manager makes final decisions about revenue-driving strategies. On a daily basis, the RevOps manager is focused on creating optimized, repeatable processes based around interdepartmental collaboration and transparency. This person plays a major role in facilitating communication between the departments so that shared goals can be defined and achieved. As such, the manager should be adept at strategic thinking, data analysis, and creative problem-solving.

Measuring revenue operations

As RevOps strives to eliminate silos within the business, it keeps a keen eye on each department’s metrics. RevOps applies analytical thinking to better understand how these departments impact each other, and it engineers processes that maximize efficiency and generate predictable revenue.

Before we get into specific metrics, it’s worth noting that data is only as good as it is accurate and updated. Setting the right foundation for RevOps means ensuring that organizational data is accessible, current, and accurate. Revenue operations leaders can leverage technology enabled with artificial intelligence (AI) to automate routine tasks so sellers can spend more time selling.

Collective[i]’s Intelligent WriteBackTM feature, for example, automates CRM data capture, eliminating bias and human error from the equation and giving sales teams a productivity boost of up to 15% to 20%.

Marketing metrics

Marketing provides initial value by bringing leads into the business pipeline. It aims to create brand awareness, qualify prospects as leads, and coordinate with sales to provide a seamless customer experience.

Relevant marketing metrics include:

  • Cost-per-acquisition (CPA): The total business cost to acquire a new customer. Calculate CPA by dividing the total marketing spend by the number of customers acquired as a result.
  • Cost-per-lead (CPL): Similar to CPA, CPL is the total business cost to attract a new lead. Calculate CPL by dividing the total marketing spend by the number of leads generated as a result.
  • Lead-to-close ratio: The ratio of potential leads to closed deals
  • Marketing-qualified leads (MQL): The number of potential leads that have been qualified (through a specific level of engagement — for example, a potential customer providing their contact information to download a gated, branded resource)
  • Pipeline generation: The number of leads that are effectively qualified and added to the pipeline. Leads may be qualified by marketing, in the case of MQLs, or they may be sales-qualified leads (SQLs).
  • Sales revenue: The total revenue generated by sales by month, quarter, and year

Marketing ROI can be difficult to measure, especially if the marketing team is siloed from other departments. Effective marketing attracts prospects and adds them to the pipeline; sales then advances the prospects further through the next stages. Transparency is vital to keeping deals moving — Collective[i]’s Predictive PipelinesTM feature eliminates guesswork and saves time with on-demand inspection capabilities and pipeline health assessments, so RevOps leaders can make any adjustments necessary for improved outcomes.

Sales metrics

Without sales, there’s no revenue. Understanding how sales metrics impact (and are impacted by) other business units gives RevOps leaders valuable insight into the larger customer life cycle. They can use metrics to make more strategic and data-backed decisions to drive future outcomes. Some relevant sales metrics examples include:

  • Conversion rate: The percentage of leads that are successfully qualified as sales opportunities, or opportunities that move from one sales cycle stage to the next
  • Opportunities by stage: The total number of opportunities at each stage of the sales cycle, particularly useful for sales forecasting
  • Opportunities-to-close ratio: The ratio of total qualified opportunities to closed deals (whether closed-won or closed-lost)
  • Performance to goal: Progress toward defined milestones. When compared to sales forecasts, this metric helps teams understand whether they are on track — or whether there are issues preventing progress toward the goal.
  • Time to move from one stage to the next: Time intervals between defined stages or milestones. This pipeline velocity metric helps RevOps teams to evaluate the sales cycle to remedy areas where the process slows down.

Sophisticated RevOps platforms can transform sales planning by leveraging AI to recommend actions based on where the metrics stand. For example, automatically creating seller-specific daily to-do lists that effectively prioritize the most impactful sales activities and alert sellers to potential risks — which manually could take hours, easily — is achieved with Collective[i]’s Intelligent InsightsTM.

C[i] RecommendsTM adds another valuable layer of analysis by providing leaders with recommendations based on the top 20% of performers (who account for 80% of revenue) from across Collective[i]’s proprietary IntelligenceTM network.

Customer success metrics

Once customers are in the fold, keeping them satisfied helps ensure the revenue will continue to flow. Some of the key metrics for gauging customer satisfaction include:

  • Customer churn rate: The percentage or ratio of customers who discontinue doing business with the organization. This metric is especially relevant for SaaS companies with a subscription model. Churn rate is calculated as the number of nonrenewals divided by the total number of customers.
  • Net promoter score (NPS): A simple customer survey indicative of loyalty to the company. NPS surveys ask one main question: “How likely are you (the customer) to recommend [Company A] to friends or family members?” When customers answer “extremely likely,” it indicates a level of satisfaction and loyalty that may result in referral business.
  • Product adoption: A behavioral-type metric quantifying the extent to which customers take advantage of product features or services. When customers use more components of an organization’s offerings, it generally correlates with an increased likelihood of continuing business or renewal (depending on the business type).
  • Support ticket volume: Another behavioral-type metric, indicative of customers who are experiencing issues with the product or service. The greater the volume of support tickets — and the longer it takes to resolve support issues — the lower the likelihood of continuing business or renewal.
  • Customer retention cost: The cost of keeping an existing customer in business with the company. Calculating customer retention cost requires some interpretation. One sample calculation would be total purchase value (over a given time period) minus retention-related expenses and general overhead.

Customers want and expect consistent, high-quality experiences when they engage with a brand. Unfortunately, it can be difficult to coordinate timely meetings between stakeholders who need to connect. Communication tools such as email or Slack are useful but aren’t the same as in-person meetings.

That’s why Collective[i] developed Virtual DealRoomsTM, where every member of the selling team can coordinate and collaborate in a shared digital space, ensuring a more consistent and streamlined customer experience, which is key to retention.

Implementing revenue operations

There are four components to a successful RevOps implementation: people, processes, data, and technology. It all begins with the data, though.

Data

Good data powers RevOps, period. Mission-critical activities like sales planning and sales forecasting benefit from complete, accurate, up-to-date data. These activities should not involve guesswork, and RevOps is meant to bring departments (and their data) together, providing all revenue-generating teams with shared, accessible data sets.

People

RevOps is a highly collaborative endeavor. As such, great candidates for RevOps roles will be team players who are excellent communicators and collaborators. They’ll have a passion for analysis and operations and welcome the challenge of tearing down operational silos and fostering greater transparency. These qualities should be specified in any revenue operations job description and further explored throughout the interview process.

Processes

When a company has a strong foundation of high-quality data and a team of dedicated professionals who are ready to make a positive impact, the sales process can be optimized and forecasts can be more accurate. Collaboration isn’t automatic, but the RevOps framework brings intention to the process — no more working in a vacuum!

Technology

Modern sales are complex — no doubt about it. Revenue operations software, like Collective[i], can be an invaluable asset for any business looking to leverage sophisticated, modern tools to align their teams, clarify their revenue goals, and drive consistent, predictable revenue growth.

To see how Collective[i] can use the power of technology to simplify metrics analysis, modernize sales, share intelligence, and enhance human connections, request a demo today.

Work together, win together

Request an invitation to join IntelligenceTM, the world’s first global network of sales professionals.

On no, we ran into an issue submitting this form. Please ensure each field was filled out correctly and resubmit.

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In the meantime, explore Collective[i] and find answers to frequently asked questions.