Importance of CRM in Sales Forecasting

Nicholas Ayers

Nicholas Ayers

Better Agency Co-founder

Sales forecasting is an important tool that plays a major role in the success of your business. Providing accurate sales forecasts allows you to make better business decisions when it comes to goals, budgeting, prospecting, and much more. Unfortunately, for many, sales forecasting is often inaccurate and doesn’t produce the results a business needs to be successful. CRM predictive analytics sales forecasting, however, can offer much more accurate results and help your insurance business succeed and thrive. But what exactly is forecasting and what are the different sale forecasting methods that may work best for you?

What is a sales forecast?

A sales forecast is a comprehensive report that uses past performance data to predict future sales revenue. These reports focus on a specific time period, such as weekly, monthly, quarterly, or annual sales predictions. Creating accurate sale forecasts can help you make better-informed business decisions and plan for future growth.

Importance of sales forecasting

An accurate sales forecast can be a valuable tool for your business. They allow you to make better business decisions concerning things like hiring, goal setting, and budgeting. For example, if your sales forecast predicts a 43% increase in sales opportunities, you may need to consider adding additional insurance agents to meet demand. In contrast, if your sales forecast predicts a decrease in sales opportunities, you may need to step back and re-evaluate your marketing strategy. The more accurate your sales forecast is, the better you can adjust your overall business strategy.

Importance of CRM in Sales Forecasting

Things to consider when making a sales forecast

When creating your sales forecast, your goal is to create a forecast that answers two main questions: What is your projected sales amount, and during what time period is the forecast covering? In order to determine the answers to those questions, there are five main things to consider.

Who are your prospects?
In order to get accurate sales forecasts, you must first identify who your actual prospects are. Who is your main target audience? Are you selling life insurance and looking to target middle-aged families or are you selling health insurance and targeting a younger audience?

What solution are you offering?
As an insurance agent, what policies are you offering and which ones do you plan to focus on more? What policies are most in-demand with your target audience and how are they providing a solution to your customers?

Where are decisions made?
Where are policy sales being made? Are you meeting directly with your clients in the office or are most of your policy sales made directly through your website platform? Which process is most effective?

Why are prospects considering your policies?
Why are potential or existing customers seeking your insurance policies? Is there something you can do to make your services and policies more compelling to your audience?

How are policies completed?
How do your customers typically complete the policy purchasing process? Are sales automatic through a website or are you meeting in person with the clients?

sales chart

Sales forecasting methods

Not all sales forecasting methods are created equal, and each method looks at different aspects of the sales process. It is important to choose the best method for your business.

Historical forecasting

Historical forecasting looks at your previous sales history through a specific time frame and assumes that your future sales will be equal to or greater than those numbers. While this method can be beneficial, it doesn’t take into account market changes or marketing campaigns that you may have executed during the previous sales period.

Intuitive forecasting

Intuitive forecasting focuses entirely on the experience of the salesperson and how confident they feel a sale will close. While this is a method often used by new businesses without any historic sales data, it is very subjective and, depending on the experience of the sales agent, can be very unreliable.

Length of sales cycle forecasting

The length of sales cycle forecasting method uses data that focuses on how long a lead typically takes to convert into a paying customer. This method allows you to break down forecasts based on lead types, such as referral leads and cold leads. If your business focuses on how and when a lead enters the sales pipeline, this can be an effective option.

Lead-driven forecasting

The lead-driven method puts the focus on lead sources by analyzing each lead source and assigning value based on how those lead sources have performed in the past. This gives greater insight into the probability of each lead turning into revenue-generating clients.

Opportunity stage forecasting

The opportunity stage method looks at where prospects are in the sales pipeline and, based on their location, calculates the likelihood of closing a sale. This method can calculate different percentages based on each stage within the pipeline.

Multivariable analysis forecasting

Multivariable analysis forecasting brings together components from all other forecasting methods and allows for a much more accurate sales forecast for your business. This method can be difficult to do on your own. However, quality CRM software provides the in-depth analytical tools necessary to conduct this highly data-driven method, giving you a much more accurate sales forecast.

Role of CRM in sales forecasting

A quality CRM platform provides the analytical tools necessary to accurately predict future sales growth based on a wide variety of different factors. By creating regular sales forecast reports automatically through your CRM, you can receive a much more accurate picture of your projected sales and use that as a tool to make any necessary changes to your selling strategy to meet your business goals.

Sales forecasting with a CRM can be a powerful tool for your business

An accurate sales forecasting report can be a valuable tool to help increase your sales conversions and boost your business. However, manually created sales forecasts can be overwhelming, time-consuming, and often inaccurate. Adding a quality CRM to your insurance business can make sales forecasting an easy and accurate business tool. At Better Agency, our team understands the needs of insurance agents. As previous agents ourselves, we have created a CRM designed especially for the insurance industry that offers the tools you need to be successful. To learn more about how the Better Agency CRM and its sales forecasting tools can help boost your business, contact us today.

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