Sales territory management is a valuable lever in the hands of sales leadership and sales operations teams. It’s about optimizing sales resources across geographical areas, which drives improved sales efficiency and sales performance.
This year has been highly disruptive for businesses across all sectors of the economy. Sales leaders have had to embrace new ways of working. For example, according to McKinsey & Company, 90 per cent of sales teams have moved to selling through phone or video conference calls.
All this change has also pushed sales leaders to do more with less as budgets and lead pools have shrunk.
In this article, we’ll look at what sales leaders and sales ops are doing about territory management. The current climate has put renewed emphasis on sales efficiency and sales productivity. As a result, sales ops teams are prioritizing sales territory management and optimization.
What is a sales ops team?
Sales ops teams are there to improve sales performance across the board. They don’t make sales calls or close deals. Instead, they’re responsible for the smooth and effective running of the sales process, and ensuring the each sales reps utilized to their fullest capacity. It’s about maximizing your resources — how can a small number of people in sales ops impact the productivity of the entire sales force?
Among other things, sales ops creates motivating compensation plans, sets challenging yet achievable quotas and designs territories that enable reps to be more productive. They also provide other tools to enable the sales force to hit their goals and maximize their compensation. These tools range from the CRM to pipeline management and route optimization to proposal management solutions.
Right now, sales leaders need to find every opportunity to boost efficiency. Sales territories are often an excellent place to start.
What is sales territory management?
Sales territory management is the ongoing process of creating, aligning and optimizing the geographical territories in which your sales team operates.
Territory management can ensure that your sales resources are evenly distributed. You can avoid a situation where one rep is overwhelmed, while others don’t have enough leads.
The best sales ops teams typically have three things driving their sales territory planning:
- Recent and reliable customer data
- A dedicated sales territory management tool
- Buy-in from sales leadership
Good data is essential for any modern sales operation. The sales ops team should ensure that the structures and processes for capturing data are in place. It can then help the wider sales department make decisions about territory optimization on solid and reliable evidence.
Dedicated territory management software takes your data and makes it quicker and easier to draw useful insights from it. It reduces the manual steps and makes it possible to do territory management at scale.
But even with good data and reliable software, sales ops teams need management support. A data-led approach to designing sales territories will provide 90% of the solution. As with many projects, the last 10% is crucial. It may not change the design dramatically, but this is where regional sales managers can apply their local knowledge and make the final tweaks. The benefit of this is twofold — a better solution, and one that has buy in from the field. If the field manager can explain to their reps why the changes were made, less time will be spent fighting the change and more will be dedicated to selling.
How sales ops teams drive success with better territory management
Sales ops teams can find inefficiencies in how sales territories are organized. With clean data and the right territory management tools, they can help sales teams make better use of their resources. Let’s look at some of the steps sales ops teams follow to create, align and optimize their territories:
1.Create a sales territory plan
If you don’t already have a sales territory plan creating one should be your first step. This is what you’ll need to so:
- Analyze your market through in-depth data insights. This includes your mapping existing customers and top leads. By mapping this information, you can identify areas where your sales team is underperforming.
- Segment your customers according to the categories that make the most sense for your team. You might start by separating them based on vertical industry, or by other parameters or common patterns you see in your CRM platform data.
- SWOT: Strengths, weaknesses, opportunities and threats. A SWOT analysis will help you highlight the advantages and obstacles in your sales territories. Through this process, you can identify actionable ways to improve your sales cycle.
- Combine your data to flesh out your territory plan. All of these insights will help you better define your sales territory plan. In the end, you should outline top territories, underperforming areas, and specific goals for your sales reps.
2.Choose a territory management tool and plug in your data
Sales territory management software is a must-have for modern sales departments. A key consideration when choosing territory management software is how it will fit with your existing CRM and other data sources.
You probably have more data than you realize. And when it comes to optimizing your sales process you need all the information you can get.
You need a solution that lets you, your sales reps and sales managers access, integrate and view data from a variety of sources. eSpatial, for example, enables you to use data from:
- Your own existing platforms. This includes a CRM software like Salesforce, Excel spreadsheets, CSV files and more.
- Other external data sources. While your own data is certainly beneficial, you might want add context with other third-party sources. eSpatial can support these, and we even provide a library with free dataset to choose from.
Check out our website to learn more about how we make data uploading and management simple.
3.Map your territories: balance and optimize
Your territory management software will allow you to visualize your data. This is often a good way to quickly spot problems and opportunities.
For example, you might notice that your top-performing rep happens to have more big customers in his or her territory than you realized.
Or perhaps someone failing to hit their numbers has too many low spending customers to be able to service them all effectively.
By balancing your sales territories you can tackle inequities across your sales team. If reps feel overworked or that their targets are unachievable they will become demotivated. Sales already has a higher churn rate than many other professions. Bad territory management could cost you good reps.
More tips to optimize your sales performance
Sales territory management plays a key role in optimizing your sales process, but here are two more tips for driving higher sales:
1.Keep an eye on your metrics
Data will play a critical role in aligning your territories, but you also need to be sure you’re tracking meaningful key performance indicators (KPIs) across the board.
To improve your sales efficiency, sales effectiveness, productivity, and your overall sales performance, consider measuring data points like:
- Revenues, including total revenue, revenue per sale, revenue per product, and revenue by territory.
- Existing customers and sales leads. This is especially beneficial if you can do this by location, and create territory maps accordingly.
- Sales call data. How often do you visit accounts, and for how long. The ability to correlate sales outcomes to sales actions is critical to fully leveraging your sales resources.
- Customer lifetime value, or the amount the business stands to make during the relationship with each customer. This article describes CLV a bit more.
- Conversion rates, as well as the other points in the sales funnel.
2.Motivate your sales team with achievable, data-backed goals
All the data you have at your fingertips will also help you create realistic, data-driven goals for your sales reps.
As sales training organization RAIN Group pointed out, having quotas in place for your sales team is beneficial, but it’s important that these are set appropriately.
You can leverage your available resources — including all the information from your sales territories and associated management — to create specific, measurable, achievable, relevant, and time-bound sales quota goals. These SMART goals will help encourage your team and bring in more deals.
If your sales ops team is looking for ways to drive efficiency and improve sales performance connect with us at eSpatial to learn more about our specialist territory optimization software.