In this first installment on our series on Salesforce Opportunities, Shell dives in and explains what is an Opportunity, how they are used and where they fit in the database. He goes over the key fields on Opportunities such as Amount, Close Date, Stage, Probability, plus others. Shell then covers the importance of having a consistent naming convention for Opportunities as they are used downstream on Reports, Views and Dashboards. There are also a few fields on the Opportunity that are set on Lead Conversion such as Lead Source, Close Date and Primary Campaign. Lastly Shell discusses "Other Fields To Know," such as Expected Revenue, Quantity and the Forecast Category field.
View this video on YouTube: https://www.youtube.com/watch?v=WWUQ0M_4O54
Other blog posts on this topic:
- Salesforce Opportunities Part 2 – Defining a Sales Process
- Salesforce Opportunities Part 3 – Opportunity Reporting
- Salesforce Opportunities Part 4 – Stage History and Contact Roles
Transcript of video:
Hello everyone, welcome to another edition of ShellBlack Whiteboard where we help you get the most of out of the Salesforce platform. I’m your host Shell Black, president and founder of ShellBlack.com and Salesforce MVP.
And today we are jumping into Opportunities. So let’s talk a little bit about what is an Opportunity. So we start hearing words like revenue, sales, pipeline management, forecasting you are probably talking about Opportunities. It’s in the database where we track dollars and revenue.
So with Opportunities we use this module in the database to really track a couple of things: who are we selling it to, how much, and when do we expect that sale to happen. So with that let me slide over here and talk about how Opportunities works inside Salesforce.com.
In an earlier episode, we talked about Accounts and Contacts where you could have an Account, in this case a company called Acme, and we know multiple Contacts at the company, kind of "one-to-many" relationship. So here are people here. With Opportunities it’s the same thing, for one company you have multiple Opportunities, dozens perhaps that you’ve created over time. So to kind of drill that topic home here’s one Opportunity from 2013. Here’s an Opportunity from 2013 that we lost, one that’s open on the pipeline that we are tracking right now, and here’s one in 2014 that we won.
So the concept is for a given company you can have multiple Opportunities. So "one-to-many" relationships. So alright, we are going to flip back to this side of the board and we are going to talk a little bit more about Opportunities and then get into our standard fields. So again Opportunities, pipeline management, sales management, working with forecasts, it’s a big module in Salesforce. So even though we are starting at the very top with Opportunities there’s a lot that goes on underneath Opportunities. If you choose to have these things turned on as an Administer so you can get into Products, Product Schedules, Quotes, Quote Templates. We will get into that in some future episodes so just follow along.
Again we are tracking who are we selling to, how much, and when do we expect that revenue to close. Opportunities is a standard object. What I mean is Accounts, Contacts, Cases, Leads, Opportunities – a standard tab. You’ve got custom fields, you can have multiple page layouts, you can have Record Types, you can customize it to your heart content. You can have Validation Rules, Workflow Rules, etc.
But let’s start out with some of the standard fields. So here are the core fields that you need to know about when you are working with Opportunities. So the first thing is the Name field. So Salesforce has this as a free form text field. There’s a standard naming convention that most people use and that’s the company name dash what are you selling. So if I was to give that example, here we have Acme and we are selling the Widget 2000, the product that we are selling.
Now the reason why you want to have it fairly descriptive is if you just said the Widget 2000 and you sell a lot of the Widget 2000 when you start running your reports you won’t know who you are selling to. So think of a dashboard for example when you are summarizing on the Opportunity Name. If the Opportunity Name is simply the company, you would see just a whole list of Acme’s or you would see you are just summarizing on the product name the Widget 2000. You would just see a dashboard listing of the product Widget 2000.
So to get some more information you kind of concatenate and add the company name and the product name. Some people will add the date field to the back of that. So there’s the 2013 sale. This is the 2014 sale. Just to get a little bit more information. Again free form text, come up with a naming convention. Some people even use Workflow to replace, standardize then name when you are saving a record. But a very important field.
So we’ve got a couple of fields that you are going to update regularly on the Opportunity. I’ve got these outlined in green. Stage, which is the picklist, which really defines your business product or your sales process in Salesforce. We will get into that a little bit in another episodes. There’s a couple of fields that are bundled together Forecast Category, Probability, and Stage. That’s why I have that little asterisk there. But just think of it as Lead Status or Case Status. It’s a picklist that tells you where you are in the sales process. Again we will have another episode just on defining your sales process.
Probability. It’s a percentage field. It’s your likelihood that you are going to close that deal. So if you are in early in the sales process, it’s typically a low percentage. As you are getting closer to winning that deal, it’s a higher percentage. When you win a deal, it’s 100% probability because you won it, if you lost it, it’s a 0%. And you can maintain that. When you change your Stage, Probability is going to default based on how you set up your sales process. Again we will have that in a future episode but you can always override it.
So let me give you a use case. So let’s say you have a really good customer. He buys all of your stuff. You may be early in the sales process but because he’s such a good customer you might juice up and raise the Probability. Conversely you might have a situation where you think maybe you are the third bidder on a RFP. You really don’t think you are going to win it. You could be really far along in the sales process but if you doubts if you are going to win it I would give it a low Probability.
The Amount field just the dollar amount of the deal, the Opportunity what do you think this is worth from a revenue standpoint. The Close Date is your best guess on when you think that deal is going to close. And the reason I kind of say your best guess, I don’t want you to beat up your sales people too much. Sales are fluid. You can go forward in sales process, you may have to go renegotiate, you might have to go back and quote, you might have to send them back to contracts. These fields get updated a lot and a sales person really needs to maintain these fields to make sure all of your reporting – your pipeline reporting, your forecast reporting – is solid. So expect to do a lot of maintenance on these fields.
Let’s talk about the Type fields. So Type is a picklist field. Out of the box it is a "New Business," is one picklist value and also "Existing Business." Really it’s a field to categorize your Opportunities so you can say how much of this am I selling to a new customer? How much am I selling to an existing customer? Again, you can categorize this, you don’t have to use those picklist values. I’ve had clients that call it "new / existing" out of the box fields or "one time" or maybe this is a "renewal" sale so they can categorize it that way. It’s a picklist you can customize it any way you want.
Next Step is a 255 character text field. I like to use this field to let everybody know what needs to happen for us to move the deal forward or the Opportunity Stage in the process. So if we are "Working on Proposals," our Stage for example, I might have a little blurb of what is happening right now or the action that I need to take to move that deal to the next step. Really you can use this any way that you want, that’s kind of a best practice.
And then you are going to have a Description field. Very large, 32,000 character text field, you can use that to describe who your selling to, more in depth about the product, the factors that play however you want to do it. Let me flip this flyer on the board.
There are a couple of fields that get set when you come out of Lead Conversion. So you have a Lead, which we have talked about in earlier episodes, which is kind of a mash-up of a company and a person but when you convert that Lead, there are some fields that are set on the Opportunity that you need to know about. So Lead Source whatever the Lead Source field was on the Lead, there’s a corresponding Lead Source field on the Opportunity and value carries across.
Primary Campaign. This is a look-up field to Campaign record. If you had multiple Campaigns on your Lead, if you have a Lead record and a related list below the Lead record, you have multiple Campaigns associated to that Lead. The last Campaign that got associated to that Lead will default to the Primary Campaign so you don’t have to think about which Campaign to give credit during the Lead conversion. Salesforce just says well the most recent probably is the one that pushed them over the edge and qualified we are going to associate to the primary Campaign. If that’s not the Campaign you want, you can always go back, use the look up field to find another Campaign.
Close Date. We talked about Close Date earlier but when you convert a Lead Close Date automatically sets it to the last day of the fiscal quarter. So people always wonder why did Salesforce pick that date? It’s the last date of the fiscal quarter. You can always override that.
So on this next section, I’m calling it the "fields you ought to know." These are fields that are typically not on the page layout and you may not even see them if they are on the page layout. So if you don’t see them check your field level of security because Salesforce has been turning some of these things off.
Expected Revenue is the first one I want to talk about. A lot of people see these on Reports but they don’t see them on the page layout. They are valuable. So Expected Revenue is actually a calculation. It’s the Amount, your dollar Amount times the Probability % we talked about earlier and the result is expressed with a dollar sign. So let me give you a quick example.
We’ve got four Opportunities, all of $100,000, each deal has a different Probability so if you start calculating, extending out the Expected Revenue even though we have four deals at $100,000, for total pipeline value of $400,000 we have an Expected Revenue that’s lower than that because it’s weighted by the Probability percent. So we really have a $200,000 Expected Revenue.
So why would use this field? So what we are trying to say is I have $400,000 in deals that I’m tracking but I only have a 20% likelihood or 20% probability that deal is going to make it all the way through the sales process and it’s going to win. So the deals that are farther along the sales process has a higher probability and so we have a better chance. So basically you are saying I have this pipeline but based on our likelihood we think this is going to close, we are going to pull down that number because we don’t expect to close all $400,000 based on where we are in the sales process we think only 20% or one out of five of those are going to close thus are weighted Expected Revenue from a pipeline perspective is lower.
Quantity. This is just a numbers field but it’s again not on the page layout by default. If you turn on Products, which we are going to cover in another segment, Quantity actually counts up the number of Products on the Opportunity. If you don’t have Products on your Opportunity, it’s just a number field. So some people want to know how many units we are selling. Some people like to use that on the page layout.
Forecast Category. I’m not going to spend too much time on this because we are going to talk about it in our next segment but Forecast Categories similar to Stage. Stage where we are on the pipeline but if you are trying to forecast which deals are going to close in a specific period so Salesforce gives you a picklist of options that categorize that Opportunity independent of the Stage.
So "pipeline" an open deal, "best case" I think of this as if all the stars align yes best case scenario this deal is going to close this month. "Commit" typically when the later stages that we are so far along in the process this is really shaping up and I’m going to commit this to my forecast and tell my management I think this one is going to win. "Closed" which can be closed won or closed lost and it will "omit" meaning you don’t want to show it on a forecast.
Okay so we covered a lot of ground with that. I appreciate you hanging in there. So we are going to get into some other topics a little downstream so tune in for more episodes. We are going to get into creating your sales process, Products, Price Books, Product Scheduling, and Quotes. We would love your feedback so thanks for all of the feedback we’ve gotten lately. If you want to reach out and contact me, there’s a couple of good ways you can do so. I’m on Twitter Shell_Black on Twitter and you can e-mail me at firstname.lastname@example.org. Thanks for tuning in. We will talk to you soon.