Salesforce Opportunity Stages

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What is Salesforce Opportunity stages? In the magical age of cloud computing, Salesforce has revolutionized the sales process by means of its Sales cloud. The CRM includes an ‘Opportunity’ tab that has made it infinitely easier to ensure a hassle-free sales process.

About Salesforce Opportunity stages

Meeting sales targets within a timeframe can be a daunting task for most sales managers. The ‘Opportunity’ tab makes this process more intuitive, transparent and less stressful. An opportunity is a specific sale or deal being carried out with customers from the forecasted sales leads for the service or the product.
The Salesforce opportunity stages must ideally map your entire sales process from start to end until the deal is closed.
The Salesforce CRM provides particular Salesforce Opportunity stages which represent vital milestones in a sales process. These stages include-

  • Prospecting
  • Qualification
  • Needs analysis
  • Value proposition
  • Identifying decision-making parties
  • Perception analysis
  • Proposal
  • Negotiation
  • Closed won/lost

More often than not, these Salesforce opportunity stages do not satisfactorily fulfill the needs of most sales processes. This is because it does not take into consideration what the product or service being offered is; the Salesforce opportunity stages require to be customized and tailored to suit the needs of the product.

Customizing Salesforce Opportunity stages

The Salesforce CRM includes a list of all sales opportunities with the current status to trace each individual deal with utmost precision. The Salesforce Opportunity stages are vital in calculating forecasted revenue for a specified period which aids the planning of all activities dependent on this revenue. However, to make the best of this feature, two things are extremely important to note.
Firstly, the stages must be custom tailored to suit the product being sold. Secondly, realistic and unambiguous stages are of crucial importance to provide pipeline visibility through reports and dashboards.
Most sales managers trying to decide custom Salesforce opportunity stage types get stuck in a rut, mainly because they are unaware on how to map out the sales process. If you struggle with this, here are some pro-tips to customize your Salesforce opportunity stages and run a healthy pipeline:

1. Concise representation

Just as misrepresented data and lack of attention to detail will not result in a successful endeavour, Salesforce opportunity stage types with ambiguities and evident loopholes will not result in a healthy pipeline. It is of primary importance that each Salesforce opportunity stage type is assigned a precise and concrete role that considers multiple possibilities and leaves nothing to chance. Having an abstract and ambiguous Salesforce opportunity stage type is the bane of every sales process.

2. Start point and end point criteria

While customizing existing stages, it is important to note that each Salesforce opportunity stage type must be assigned a point of kick-off and a point of exclusive termination. Without properly establishing this, it creates an air of uncertainty among sales managers about what allows moving on to the next Salesforce opportunity stage. If a stage is closed prematurely, it causes the pipeline reports to display redundant data.

3. External dependance

It is important to note that each Salesforce opportunity stage represents a rung of a ladder that is your sales process. When stages are dependent on external factors outside the confines of your company and sales process, the pipeline reports start to become redundant. For example, let us consider the Salesforce opportunity stage type, Negotiating. The customer will always make a choice based on the cost-to-benefit ratio for his own business while negotiating terms with multiple parties involved and this represents a factor outside the line of control of the sales manager.
In this Salesforce opportunity sales type, the sales manager should attempt to eliminate dependability on the customer and the choices in his arsenal. Stages must intuitively reflect your sales process because it helps in standardizing the procedure without adding error in the form of factors outside your direct line of control.

4. Salesforce opportunity stage probability

Data is the foundation of modern society. Everything around is dependent on data. In CRM, each opportunity stage has a percentage probability associated with it. This percentage represents what the probability is of closing a deal successfully at a particular stage. The probability of closing the deal successfully increases with each opportunity stage. The probability for each opportunity stage type must be assigned based on historical evidence and data from past deals.
Assigning Salesforce opportunity stage probability can make-or-break your pipeline as it has numerous advantages including using weighted pipelines, accurate pipeline reports, precise forecasted revenues etc. The biggest challenge in forecasting revenue is the uncertainty in conversion of leads into opportunities and then eventually into a deal. The reason for this is that we are unsure of the likelihood of closing a deal and assign equal weights to all opportunities being closed.
However, Salesforce opportunity stage probability provides a means of combating this problem. More particularly, using a weighted sales pipeline by using weighted targets for your sales makes a vast difference. A weighted target is essentially the product of the sum of total opportunity values assigned to each individual stage and the probability of closure for that Salesforce opportunity stage.
By using a weighted sales pipeline, you are acknowledging that not all opportunities will result in a sale and this provides a more detail-oriented approach. In a weighted sales pipeline, opportunities with higher likelihoods of closing are given more weight in sales forecasting. This helps account for the fact that not all leads become customers. The idea is that the further along a deal is in your pipeline, the greater the probability it will close.

5. Revise and update opportunity stages

Each opportunity stage is only as accurate as it is made to be. The need to constantly troubleshoot and update each Salesforce opportunity stage type will present itself more often than expected. It is necessary that stages depict a series of current correspondences with customers rather than a one-off milestone.
This necessity may facilitate tweaking based on how the process is moving along. There may also be other parameters to be considered while moving your opportunity into pipeline for a particular customer. Perhaps you have considered that it is not worth it or that the potential closing details interferes with your forecasted revenue target. This will require to dynamically modify the current stages to best suit your needs.

6. Limit the number of opportunity stages

As discussed multiple times, the stages must reflect the sales process demanded by your specific product or service. And this requires a great deal of finesse and attention to detail germane to the process. However, it is always better to have as few stages as possible and in the interest of being detail-oriented, each opportunity stage can have sub-sections instead of a new opportunity stage. Experts suggest that five to seven is the ideal number of stages required to run a smooth sales process and even fewer if the product demands smaller complexity.

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Remember, your ability to accurately forecast revenue is dependent on how you customize the stages. Using these tips and accurate forecast categories, the pipeline can be concisely summarized and the sales forecast can be satisfactorily defined.