Article | 4 min read

What is a sales analysis?

There are many different methods and techniques you can use to analyse your sales. Discover the most important.

Last updated May 3, 2023

Sales analysis is the process of identifying and processing sales and revenue-related data. Processing this data ultimately allows you to interpret it, which in turn allows your teams to factor any findings in to future sales initiatives and marketing activities. A sales analysis typically includes dashboards and graphs that make it easier to track how sales are developing. The most frequently used performance indicators in the dashboard are:

  • Sales by product
  • Sales by region
  • Sales growth rates
  • Sales rates
  • Average purchase value

Conversion and cannibalization rates are sometimes also used as KPIs.

Why should you analyse your sales?

Analysing your sales helps you better understand how your sales teams are performing, which then allows you to take targeted actions to boost sales. What’s more, a sales analysis makes it easy to pick out your star products (if you have more than one product) and can help you spot any changes in customer behaviour and seasonal effects. It’s typically designed for a specific market environment and not only allows a company to gauge its position in a given market in relation to its competitors but also track how this position develops over time. Finally, properly analysing your sales can help you better understand your market, anticipate changes and make more informed decisions.

7 sales analysis methods

There are many different methods and techniques you can use to analyse your sales. What methods you should choose will depend on your aims and available data.

Performance analysis

This analysis is designed to work out the effectiveness of a sales or marketing strategy. It uses sales figures – primarily revenues and margins – that relate to a specific team, department or product. Tracking these indicators is a great way to see how a given strategy is impacting sales. This analysis also provides insight into team performance.

Sales trend analysis

You can use a sales graph to find a trend line, which you can then use to predict future sales. This analysis can also help highlight seasonal effects. Understanding trends enables you to adapt your marketing and sales strategies perfectly.

Predictive analysis

Predictive analysis involves examining a statistical model of sales growth over a given period. You can then use the linear trend equation to estimate future sales volumes. This analysis is based on historical data, which means the more data you use, the more accurate it becomes. You can also use it to predict sales and market growth, helping you stay ahead of the curve.

Prescriptive analysis

You can’t do prescriptive analysis without predictive analysis because it uses the findings from predictive analysis to recommend actions based on different scenarios. Each scenario is assigned a sales volume and you can maximise your sales by implementing appropriate measures for each scenario.

Diagnostic analysis

Diagnostic analysis sheds light on different KPIs on your dashboard and how they have changed over time. Once you know why something has changed, you can create a plan of action to address any shortcomings and strengthen your position. You should regularly perform diagnostic analysis to ensure you're not overlooking any important market variables.

Sales pipeline analysis

The sales pipeline maps out every stage of the sales process – from first contact to closing the sale. Analysing this process can help you identify where customers are abandoning their purchases. You can then use this insight to implement targeted measures to keep customers onboard – all the way up to completing their purchase.

Sales management

Sales management is all about analysing sales effectiveness by monitoring the performance of sales representatives. The aim is exactly the same as pipeline analysis: getting customers to complete their purchases. Monitoring the performance of your sales teams allows you to fine-tune how they interact with customers. Sales and conversion rates are two of the most important indicators in sales management.

A guide on how to get started with sales forecasts

Get to know the basics of sales forecasting and master the key methods to improve your business decisions.

A guide on how to get started with sales forecasts

Get to know the basics of sales forecasting and master the key methods to improve your business decisions.

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