How to measure Sales Training ROI

According Jim Dickie from CSO Insights companies on average spend between $1,815 and $2,870 on sales training per sales rep per year. What is the return on this investment? Does it pay off?

There is a plethora of sales training companies and sales trainers. Every one will promise you incredible results and they will back it up by a number of their best case studies and highlight their unique methodology.

But how many of those success stories were actually driven by the sales training? Maybe the company was in a growing market. And how do you know you will get the same trainer as the clients in the cast studies? And thinking of the price — is it an indicator of quality or are you at risk of buying just hot air?

These and similar questions can lead to an information overload and decision paralysis. Sometimes companies just decide to stay with whatever training they have done to date or they go for a low risk, low cost option because it’s easy.

However as a result they might greatly miss out on the biggest benefit of sales training which is the increased sales, not the saved costs. It’s the increased conversion rate, shorter sales cycle and the extra value the reps will manage to generate. Sadly many companies play it safe.

If only there was a crystal ball that would tell you upfront how much a particular sales training will make you, right?

But wait!

You do have such a crystal ball now — it’s your Sales laboratory.

You don’t need to make a decision regarding a sales training blindly. You can test it. For example you can take one of your sales teams through the training and monitor what impact such training will have in real life. The cost should be relatively modest as it will be just one team and the provider might even offer a discount in the hopes of proving their worth and winning the large contract.

If you feel particularly playful, you could even test several trainings at the same time. Imagine you split your reps into five groups and took four of them through a different sales training and one would be your control group.

You could then measure the impact of each sales training on each team very clearly, comparing the specific team’s performance before and after the training.

Analysing it, it could look something like this (measure for example an average percentage of a target achieved):

And the underlying data could help you identify the most successful training. In this illustration the one that Team 3 went through.

This is easier done in transactional sales setting with shorter sales cycle, but an effective sales training should help sales reps right away with opportunities already in their pipeline, closing them quicker and potentially increasing average order value.

Tips:

When analysing the results, it’s good to review a suite of metrics, not just one — aside of percentage of target achieved, you might also want to look at the reps’ conversion rate, average order value, length of sales cycle and profitablity.

You also want to put the benefit a training delivered into the context of the cost of a training. Some of the best training is also the most expensive (though it’s not always true) so calculating the return on investment is important.

Keep in mind that a training that’s suitable for a group of your reps might not be similarly effective on your other reps — watch closely the impact on new sales reps, advanced ones and your expert sales people.

Summary:

When it comes to sales training, don’t get satisfied with “good”, go for “great” the difference is huge. With a sales laboratory it’s much easier to find a training that delivers the results.