The GTM Metrics and Insights Framework

Read time: 8 minutes

Written by:

Eddie Reynolds
Founder & CEO

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Building a Data-Driven GTM Team

We’ve worked with revenue leaders in over 1,000 B2B SaaS companies for more than a decade. They all want one thing: visibility into their business.

Unfortunately most revenue leaders don’t have this visibility. They can’t trust their data and have to rely on gut-level decisions. Additionally, visibility isn’t what we really need. What we need are insights into what’s working, what’s not, and, most importantly, what we should do about it.

In this Framework we’ll guide you on identifying the right metrics to track, how to get accurate data for those metrics, how to translate that data into actionable insights, and how to get the GTM Team executing on those Insights.

More importantly, we’ll show you how to build a more efficient GTM Engine and significantly increase your chances of achieving a big exit down the road.

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Measure What Matters

So, where do we start?

What metrics we track depends on our GTM motion(s) and what we want to inspect first, where we think the greatest opportunity for improvement might lie. It takes a lot of work just to get the data accurate and the list of metrics to run is infinite.

However, here are some of the most common and important metrics across GTM, starting at the highest level, then drilling into the details.

GTM Efficiency

Let’s start with a very simple question:

How efficient is our GTM Engine?

More specifically:

What’s it cost to generate $1 more of ARR?
What is the lifetime value of a new customer?
What’s working well and not in each area of GTM?
Where should we invest more? Invest less? Optimize?

GTM Efficiency starts with the cost to grow revenue (CAC, CAC Payback and CAC Ratio.) Generating $1 of ARR for $1 or less of sales and marketing spend is typically ideal but it depends on the Lifetime Value (LTV) of the Customer and our costs to retain and grow them.

The GTM Efficiency Ratio is similar to CAC Ratio but includes new business, expansion, retention, and all associated costs, for a more holistic view.

These metrics give us a high level overview but we need to segment this data into new business vs. expansion, by channel, team, product, geo, etc to pinpoint where to invest, optimize, or reduce waste.

Financials

Our GTM Efficiency, alongside other areas of our business, drives our financials.

Investors will ask higher level questions about our financial health:

Are we growing fast enough and profitably enough?
What does revenue, income, and cash flow look like?
What do expenses look like in each area of the business?

This translates into common metrics such as:

Rule of 40: Growth + Profitability ≥ 40%.
Bookings Growth and Net Revenue Retention (NRR).
Gross Margin and Operating Expenses
Profitability measures like EBITDA, Free Cash Flow (FCF), or burn rate.

These metrics will heavily influence our ability to attract more capital and/or have a strong exit. They also tell us, internally, if we’re managing our financial resources effectively.

GTM Metrics

We’ve looked at our GTM Efficiency Metrics and Financial Metrics.

Now we’ll look at what drives them, and break them into three overlapping categories:

Pipeline Management: How effectively are we closing the pipeline we’re generating?
Pipeline Generation: How effectively are we generating pipeline via each channel?
Customer Success: How effectively are we retaining and growing our customers?

These metrics are obvious but often very poorly tracked, providing us no real insights.

For example, we frequently see reps with wildly different Close Rates because each rep has different qualification criteria and a different sales process to close deals.

This means we’re losing deals we shouldn’t and wasting money on reps chasing the wrong deals. It also means we can’t trust our data. We can’t trust our pipeline and we can’t trust any of our pipeline generation metrics either.

Process and Execution: The Foundation of Reliable Metrics

The #1 reason we can’t trust our data is a lack of process and/or consistent execution.

Continuing with our Close Rate example above, we most likely don’t have a clearly documented sales process or our reps simply aren’t executing that process.

To fix this, we need to document the process, train the team, build reporting to track the right data and execution, and then drive adoption. This isn’t complicated, but it’s not easy. It requires daily effort of leadership and operations to drive this.

Unblending the Funnel

Even with perfect data we often miss what’s working and not working inside the GTM Engine. This happens because our data is blended together, masking what’s really happening.

For example, when we look at all MQLs together, we don’t see the dramatic differences between Demo Requests and Webinar Leads in conversion rates, Average Sales Price, etc. and the total revenue they produced.

Here’s a visual:

To uncover real insights into our GTM Engine we need to break down metrics by channel, lead type, product, team, geo, etc. This requires a lot of work but it helps us set realistic targets, double down on high-performing areas, and eliminate inefficiencies.

Recurring Data Inspection and Analysis

Getting accurate metrics requires constant inspection. Even the best-defined processes degrade without consistent effort. A regular pipeline review, for example, is critical to be able to trust your pipeline. The same goes for each and every channel generating that pipeline and everything we do to retain and grow customers.

Beyond inspection, true insights come from analysis. GTM leaders often lack the time or expertise for this. A RevOps leader or analyst should dedicate time to dig into data, uncover trends, and present actionable insights to revenue leaders.

Most importantly, this requires the right person with the right amount of uninterrupted time for deep work.

The Pipeline Council

Insights are great, but you have to take action on them. A Pipeline Council is a recurring meeting of sales, marketing, CS, and finance leaders to do just that. This forum discusses findings, decides on actions (e.g., reallocate budget, optimize processes, or train teams), and prioritizes initiatives for the Revenue Operations Roadmap.

It’s not necessary for small GTM Teams but once we’re at a certain scale it makes sense to bring everyone together to identify real issues and opportunities and allocate resources to tackling them.

Annual Planning and Scenario Testing

With clean data and processes, annual and quarterly planning improves dramatically. Instead of doing the typical Top-Down model where we guess at how we’ll hit a certain target, we can build a bottoms up plan.

We can see clearly how much pipeline we’re generating via each channel, what we can expect to close from it, and when. We can run scenarios to see what might really happen if we spend more on a given channel, hire more people, etc.

Unfortunately, without these solid foundations, our planning is just guesswork. With them, we gain confidence in our forecasts and our investments.

GTM Metrics Index

If you’d like the formulas and explanations for each of these metrics, check out our GTM Metrics Index.

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