What is the sales pipeline waterfall?
The sales pipeline waterfall metric is a useful visualization of the company’s open opportunities and how they develop over time. It provides an overview of how the number of open opportunities increases and decreases in different ways throughout a specific period.
Positive inputs represent opportunity amounts that are added to the starting pipeline while negative values indicate opportunities that were removed from the pipeline. The final sum is the amount of pipeline that is still open.
The period pipeline waterfall displays changes in the total amount of starting pipeline with close dates that fall within that period, while the rolling pipeline waterfall shows all open opportunities and their changes regardless of their close date.
Why is the sales pipeline waterfall an important metric?
Tracking the amount of opportunities in the sales pipeline and how they develop is critical to managing the company’s revenue generation. This metric requires continuous monitoring and optimization because growing, developing and winning pipeline is the company’s most fundamental process.
To accomplish this, the sales pipeline waterfall provides a clear view of the total amount and how the pipeline changes over time. This metric is used to ensure the health of the company’s revenue engine, monitor performance throughout the period, and be alerted to important changes that may affect each period’s final sales results.
How is the sales pipeline waterfall calculated?
The waterfall includes various components that represent different changes that add to (+) or subtract from (-) the pipeline:
- Starting (+) : Opportunities that were in the pipeline at the start of the period.
- New (+) : New opportunities that were added to the pipeline during the period.
- Pulled-in (+) : Opportunities that were expected to close after the end of the quarter but were now expected to close during the quarter.
- Slipped (-) : Opportunities that were expected to close during the quarter but were now expected to close after the quarter is over.
- Pipeline Won (-) : Opportunities that were won during the quarter.
- Pipeline Lost (-) : Opportunities that were lost during the quarter.
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Sales pipeline waterfall is only one of the hundreds of SaaS metrics that are available out-of-the-box to users of the Sightfull revenue analysis and optimization platform. They include all the critical metrics required for SaaS companies - from indicators regarding campaigns and leads, through those that track pipeline, conversion and bookings, and all the way to later signals such as retention and expansion.
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Also known as:
- Sales conversion funnel
- Sales workflow
- Sales process flow