9 CRM KPIs You Should Know for Maximizing Business Success

The buzz around CRM is real. Not only is CRM the fastest-growing software in digital marketing, but it is also indispensable for 92% of businesses in their pursuit of revenue growth. 

Yet, adopting a CRM isn’t a set-it-and-forget-it process. Monitoring CRM KPIs is essential to offering invaluable insights that will help you grow your agency. 

This article will take a look at three categories of CRM KPIs: sales, marketing, and customer service. The article will also give tips on how to make sense of these KPIs and leverage insights to boost revenue.

What Are CRM KPIs?

CRM KPIs are measurable values that indicate how effectively your marketing agency is achieving its key business objectives. They provide a clear picture of your agency’s performance across various areas, including sales, marketing, and customer service. 

By regularly tracking these KPIs, digital marketing agencies can identify strengths, pinpoint weaknesses, and make data-driven decisions that enhance overall business performance. All in all, CRM KPIs are an integral part of conducting a SWOT analysis.

Without effective CRM KPI tracking, marketing agencies often face challenges, such as misaligned sales processes, inefficient marketing efforts, and high customer churn rates. 

Key CRM KPIs and Their Impact

Without further ado, let’s dive into the 9 CRM KPIs every digital marketing agency should keep tabs on to ensure success.

Sales Performance CRM KPIs

Close Rate and Average Deal Size

The close rate is the percentage of leads that convert into customers, while the average deal size represents the typical revenue from each sale. Together, these metrics help assess the efficiency and profitability of your sales team. 

A low close rate or small average deal size could indicate a need for better lead qualification or more effective sales pitches.

Tip: If your marketing agency receives a stream of prospects that are a poor fit or struggle with lead generation, you may find this article on how to find clients in digital marketing insightful. 

Upsell Rate

This CRM KPI measures the frequency with which existing clients purchase additional services. A high upsell rate indicates that your marketing agency is effectively identifying and capitalizing on opportunities to grow revenue from current customers. It’s a sign of strong client relationships and the ability to offer solutions that meet evolving client needs.

Sales Cycle Duration

This metric tracks the time it takes for an individual to convert from a prospect into a customer. A shorter sales cycle typically means more efficient sales processes. 

Monitoring this KPI helps identify bottlenecks in the sales process, such as delays in follow-ups or extended negotiation periods, allowing your agency to streamline client communication and close deals faster.

Here’s how to calculate a sales cycle duration:

To begin with, you should define the start and end points. A start point is when a lead is first generated or enters your CRM system. This could be when they first engage with your content, fill out a client intake form, or respond to an outreach effort.

An endpoint is when the sale is closed and the contract is signed. This marks the conversion from lead to customer.

To track each lead’s customer journey, record the date when each lead enters the sales pipeline and the date when each sale is closed.

To calculate the duration for each sale, subtract the start date from the end date for each sale. This will give you the duration of the sales cycle for each deal.

To compute the average sales cycle duration, add up the durations of all closed deals within a specific period (e.g., monthly or quarterly). Divide the total duration by the number of deals closed within that period.

Marketing Performance CRM KPIs

Customer Lifetime Value (CLTV)

CLTV represents the total revenue a client is expected to generate over the course of their relationship with your marketing agency.

This metric helps gauge the long-term value of your customers. Agencies with high CLTV can justify more substantial investments in customer service and client collaboration efforts.

How to Calculate CLTV:

• Determine Average Purchase Value (APV):

• • Calculate the total revenue generated over a specific period (e.g., annually).
  • Divide this total revenue by the number of purchases made within that period.

• Calculate Purchase Frequency (PF):

• • Determine the total number of purchases made by all customers over the same period.
  • Divide this by the total number of customers.

• Compute Customer Value (CV):

• • Multiply the Average Purchase Value (APV) by the Purchase Frequency (PF).

• Estimate Customer Lifetime (CL):

• • Calculate the average number of years (or months) a customer continues to purchase from your agency.

• Calculate CLTV:

• • Multiply the Customer Value (CV) by the estimated Customer Lifetime (CL).

For example, if the average purchase value (APV) is $2,000, the purchase frequency (PF) is 3 times a year, and the average customer lifetime (CL) is 5 years, the CLTV would be: CLTV=2,000×3×5=$30,000

Customer Acquisition Cost (CAC)

CAC measures the cost of acquiring a new customer, including expenses related to marketing, sales, and other operational costs. By optimizing this KPI using CRM insights, such as incorporating the 10 steps of a digital marketing strategy, your agency can reduce costs and increase profitability.

Email Marketing Revenue

Tracking the revenue generated from CRM email marketing campaigns helps gauge the effectiveness of your email marketing strategy. This KPI is crucial for understanding which campaigns resonate with your audience and drive conversions, allowing your agency to refine its email marketing efforts for better results.

For example, if your email campaigns don’t generate the revenue you planned to achieve, you could consider improving your audience segmentation and target market segmentation strategies. 

Customer Service CRM KPIs

Net Promoter Score (NPS)

The NPS measures customer loyalty by asking clients how likely they are to recommend your agency to others. A high NPS indicates strong customer satisfaction and effective client management, which can lead to more referrals and repeat business. Regularly monitoring NPS allows your agency to address any issues before they affect client retention.

Abandonment Rate

This CRM KPI tracks the percentage of customers who stop using your services before completing a contract or purchasing a package. A high abandonment rate can indicate dissatisfaction or unmet expectations, signaling the need for improvements in customer service or product offerings.

Tip: If your marketing agency struggles with meeting growing customer demands, Vendasta’s white-labeled marketing services can help. 

Average Time to Resolve Tickets

The speed at which your agency resolves customer issues is important for maintaining high levels of satisfaction. This KPI measures the average time it takes to address and resolve customer support tickets. Faster resolution times always lead to happier clients and better retention rates.

Implementing CRM KPIs with Vendasta Solutions

Vendasta offers a robust CRM platform designed to help digital marketing agencies track CRM KPIs.

With Vendasta’s CRM, you don’t need to manually calculate anything. The CRM does the job for you!

Specifically, Vendasta's CRM allows agencies to track the progress of each deal through customizable pipelines, providing insights into close rates. It also records deal sizes, helping agencies monitor the average deal size over time.

The CRM provides detailed tracking of the entire sales process, from the first contact with a lead to closing the deal. 

Vendasta's CRM aggregates customer data, enabling agencies to analyze purchase history, engagement, and retention rates. 

As a cherry on top, with built-in email marketing tools, the CRM allows agencies to launch, track, and analyze email campaigns directly within the platform.

Strategies for Optimizing CRM KPI Performance

Remember that your CRM KPIs should be Specific, Measurable, Achievable, Relevant, and Timely. SMART goals provide clear targets for each KPI, making it easier to track progress and achieve business objectives.

For example, you could set a goal to increase the customer retention rate by 10% over the next 12 months or achieve an average email open rate of 25% for all marketing campaigns in Q4. 

Leveraging data from CRM KPIs allows your agency to make informed decisions. For example, if the KPI for customer acquisition cost (CAC) is higher than expected, you can analyze CRM data to identify which marketing channels are underperforming. 

By reallocating the budget to more effective channels, such as those with a lower cost per lead, you can optimize your marketing strategy and reduce CAC.

If the sales cycle duration CRM KPI indicates a prolonged sales process, you can examine CRM data to identify stages where deals are stagnating. For instance, if deals are consistently delayed at the proposal stage, you might refine your proposal templates, train sales reps on how to build rapport with prospects to move them forward through the sales funnel, or equip your sales reps with client management skills.

If the average time to resolve tickets CRM KPI is higher than the target, you can use CRM data to identify common issues causing delays. By analyzing the types of tickets and their resolution times, you might discover that certain types of requests require more training for support staff or could be automated. 

Success with CRM KPIs

Regularly reviewing and adjusting your strategies based on KPI performance ensures that your agency remains agile and responsive to changes in the market. Continuous improvement helps maintain a competitive edge and sustain long-term success.

By leveraging Vendasta's CRM, digital marketing agencies can not only track their KPIs but also use the insights gained to make data-driven decisions, optimize processes, and ultimately achieve greater success.