3 Examples of a Win Rate

John Spacey, October 13, 2018

A win rate is the percentage of proposals or bids that result in a win. This is commonly used to measure sales and marketing efforts. The following are common examples of a win rate.

Proposal Win Rate

The total number of proposals that result in a sale expressed as a percentage of the total number of proposals in a period. It is common to only count opportunities that progress to a full proposal with a price quote. For example, a sales team that has 90 opportunities open with 22 that progress to a quote resulting in 7 deals closed has the following win rate.

Proposal Win Rate	= (deals closed / proposals) × 100
	= (7 / 22) × 100
	= 31.8%

Revenue Win Rate

It is also possible to base your win rate on the total revenue of proposals and deals. For example, a team with proposals worth $20 million that result in closed deals of $12 million has the following win rate.

Proposal Win Rate	= (revenue closed / total value of proposals) × 100
	= ($12 million / $20 million) × 100
	= 60%

The two methods above for calculating proposal win rate often produce starkly different numbers. For example, a team might have a win rate of 31.8% by one method and 60% by the other. As such, it is tempting for teams calculate their win rate by switching back and forth between these two methods when convenient. Generally speaking, the win rate metric has a reputation as being easy to exaggerate. A win rate based on revenue is considered the stronger version of the metric.

Advertising Win Rate

An advertising win rate is used to measure your competitive position in buying digital advertising in a marketplace such as a real-time bidding exchange. For example, an advertiser that wins 22,000 impressions with 300,000 bids has the following win rate.

Bid Win Rate	= (ad impressions / bids) × 100
	= (22,000 / 300,000) × 100
	= 7.3%

An advertiser with a highly targeted offer typically wants a high win rate. For example, a camera retailer that is targeting a customer who has been searching for high-end camera features and prices does not want to lose bids to a competitor. An advertiser who has a general offer that isn't targeted such as a campaign to raise brand awareness for a soft drink brand may not require a high win rate. In this case, a low win rate may simply indicate the advertiser is getting a reasonable price for its bids by not being too aggressive.

Notes

In many industries, the average proposal win rate for sales is around 33%. This is because customers typically compare three alternatives before purchasing such that they accept 3 proposals with one winner. As such, a win rate of 50% or higher is a very good result. Firms with dominant products in a product category can enjoy win rates approaching 70%. A monopoly whereby there is essentially no competition for a critical product or service may have win rates exceeding 80%.

It is normal for proposal win rate to be inconsistent quarter over quarter as it can be influenced by a single large deal or a large number of low quality opportunities. A win rate can bounce around wildly as revenue is stable. As such, proposal win rate isn't considered a particularly reliable metric for evaluating strategy and performance.

3 Examples of a Win Rate

Proposal Win Rate

Revenue Win Rate

Advertising Win Rate

Notes

Sales

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