Why sales leaders are excited for 2016 sales growth

With over 5.4 million sales pipeline transactions in their database last year, InsideSales.com has nearly unprecedented insight into sales cycles and the state of sales in 2016. Luckily for the rest of us, they’ve combined that data with surveys from over 600 sales leaders for a comprehensive report on important sales trends in their new Business Growth Index. Read on for some of the key takeaways for sales executives or anyone else responsible for driving sales growth in 2016.

Slumping Close Rates are Misleading

Compared to 2014, InsideSales found that close rates decreased by an average of 2.1 percent in 2015. The research also saw an increase in the length of sales cycles from 75 days in 2014 up to 80 days last year. Now, on their own, those statistics could be worrisome, but the saving grace comes when you look at deal sizes, which are up 5.5 percent.

As stakes get higher and decision-makers are more reluctant (and more decision-makers get involved in the process), it’s not too surprising that the time to closing a deal stretches on and a slightly higher number of deals stall out. 35 percent of respondents specifically call out larger deals as a reason for lengthening deals, alongside competition and lead quality.

These figures aren’t applicable across all demographics. Some notable differences:

  • Companies with a revenue of over a billion dollars increased their close rates by 2 percent
  • Companies with a revenue of under a billion increased deal sizes by 14.1 percent
  • West coast companies’ sales cycle length increased 4.0 percent versus 7.3 for other locations

High-Tech Sales

The differences keep coming when you break down sales figures by industry—especially so for high-tech companies who sell software. Of all the industries surveyed, software companies reported the highest growth in 2015 (36 percent) and projected growth in 2016 (45 percent).

What makes this growth particularly fascinating is the measured volatility that software companies experienced in 2015 compared to other industries:

  • Close rates down by 4.7 percent
  • Sales cycle length up 7.5 percent versus 6.4 for other industries

Even the increase of opportunities in 2015 falls behind other industries (10.8 vs 18.3 percent). So, why the growth? Again, the answer comes in the sizes of the deals: deals increased by a staggering 9.7 percent for software companies.

The Tech Behind High Sales

2015 also spelled good news for high-tech companies selling sales software as adoption of emerging technologies increased (along with the number of categories of both sales and marketing software). While out of the 19 categories of sales software included, none were reported to be used by a majority of sales leaders, 3 stand out above the fray:

  1. CRM Software (such as Salesforce; 45.6 percent usage)
  2. Sales Intelligence Software (such as InsideView; 35.2 percent)
  3. Sales Presentation Software (such as SalesKit; 32.8 percent)

If those numbers seem low, that could be because nearly a quarter of the respondents in InsideSales.com’s survey reported revenues of under 5 million dollars, where tighter budgets lead to slower adoption or sales leaders could be miscategorizing solutions based on vague definitions.

Sales Leaders are Confident

The biggest takeaway from the Growth Index? Business is good. Respondents predicted an average sales growth of 30.5 percent in 2016, up from 23 percent the year before. While there were variations in the ages, gender and industry of sales leaders, nearly three-quarters of respondents predicted growth in 2016. Even with the variations in individual industries, every industry reported increased predicted growth this year. And that’s after the worst calendar-year start for the stock market in history.

You can compare your own company by downloading the full report on InsideSales.com. If you’d like to know how your sales tech stack can accelerate your sales in 2016, download our guide to sales tools below.

Image credit: Sunset Jump by Josh Janssen | Creative Commons