Why Your Sales Team should Track Revenue Growth


There are numerous critical metrics that sales teams need to measure, should each member of your team track revenue growth?


Technology and advanced analytics have created the ability to track so many elements. I have been wondering if revenue growth is the most critical metric for a sales team. What about the myriad others, like lead generation or market share, etc.? So I did some research to find out, and it seems revenue growth should indeed be the most important metric for sales groups because so many other business imperatives are derived from revenue growth. The health of the entire enterprise is gauged by it.


I culled information all over the web from sales and business experts to see if there was consensus on the most important metrics. I can tell you, there is a surplus of content that looks something like this: “The 9 Measures Your Group Should Track to Grow Sales”, “The 10 Most Important Things Your Business Should be Monitoring Right Now”, “The 7 Elements Your Sales Team Must Measure to be Successful”. I just now made-up all those titles, but you get my point, there is A LOT of available information about what’s valuable or critical for a sales team to measure.


I’m not bashing all the metrics content that’s out there; It’s good stuff. There are many things a sales group should be measuring and improving to grow and be successful. However, If you were to combine all the metrics that experts say are important for sales success, you would be burdened with measuring hundreds of sales related elements. Ultimately, you should pick the sales metrics that are most important to your team and that support your organization’s priorities.


The one metric that was a common element in most of the lists I read and should absolutely be one of the metrics each of your team members tracks, is revenue growth.


Some lists had sales growth instead of revenue growth because they are frequently cited as the same thing, but if you’re in an industry where refunds are part of doing business, you want to measure revenue growth, not sales growth.


Here are reasons that attributed to revenue growth being one of the most important metrics on so many of the resources I studied:


  • The most crucial point of revenue is the fact that it’s the economic engine of a company; without it, a company cannot earn a profit and stay viable. Companies that don’t grow don’t last, companies that grow too slow get left behind by their competitors. Revenue growth is typically the key metric every business uses to measure its financial performance.
  • There is a confidence component for employees. Revenue growth has a psychological impact. Employees need to have confidence in the long term health and viability of the company they work for. Stagnating or declining revenue growth will not attract the best talent to your organization. Employees expect to benefit from a growing company in terms of wages, career path opportunities, and bonuses. When your company is growing, employee satisfaction is also likely to grow.
  • Growing revenue also instills confidence and comfort in suppliers, business partners, community members and any other stakeholders impacted by a business.
  • Revenue is examined more closely than profits when determining the growth of a business. Investors want to see that a business has the capacity to generate increasing sales over time demonstrating the ability to expand its customer base.
  • Lenders will certainly want to know that a company has the ability to generate steadily growing revenue. Qualifying for loans with favorable interest rates allows a company to fund new projects, expansions, and other business activities.
  • Every group and department within a company has their own unique priority measures and metrics as they should, but having an organizational target that is shared by all individuals and departments breaks down walls and silos. A common target creates solidarity and can act as a rallying call for the entire team.


How is revenue growth improved?

As an organizational target, percent growth in revenue could have a cascade of interdependent measures for every job level within each department, but from a high-level view revenue growth is achieved in 4 ways:

  • Increase the number of customers.
    • Add complementary products or services. For example, a lawn service company or landscaper could easily add swimming pool maintenance. This would generate new customers and maintain existing ones.
    • Start marketing in other areas and extend your geographical market.
    • Establish cooperative sales agreements with companies that sell a complementary product or service.
  • Increase the average transaction size.
    • Up-sell or cross-sell at the point of purchase when customers are most receptive. Getting the customer to buy a better, more expensive product, or a complementary product that adds genuine value just adds extra revenue without additional effort or time.
    • Bundle your offerings by encouraging customers to spend more on a package deal of multiple products or services
  • Increase the frequency of transactions per customer.
    • One of the easiest and most obvious ways to increase the frequency of transactions with your current customer is just consistent and frequent communication. Don’t be spamming your customers, but reaching out on a frequent basis builds an ongoing relationship with your customers and shows that you care.
    • Develop loyalty or rewards programs. These are a great way to increase purchase frequency as customers receive rewards with each purchase they make. Popular rewards programs work on a point system. As points accrue, they get closer to the award and become more likely to continue choosing your brand over the competition.
  • Raise your prices.
    • Most of your customers will be willing to pay more for your products or services as long as they believe they are receiving great value.


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