But did you know that your choice to be diverse may actually impact your bottom line? In fact, researchers and businesses have learned that diversity has a tangible business impact.
How Diversity Affects Sales Performance
1. Diversity is correlated with sales revenue.
According to sociologist Cedric Herring, diversity in a business is one of the most important factors for predicting sales revenue. That’s right — one of the most important factors. His article in the American Sociological Review says diversity is linked to increases in sales revenue, profits and customers.
By analyzing data on more than 500 U.S.-based, for-profit businesses, Herring also found that:
- Companies reporting the highest levels of diversity brought in nearly 10-15 times more sales revenue on average than those with the lowest levels of diversity.
- Businesses with high diversity are more likely to report higher-than-average percentages of market share.
- Higher levels of diversity are associated with having more customers.
“It is likely that diversity produces positive outcomes over homogeneity because growth and innovation depend on people from various backgrounds working together and capitalizing on their differences,” Herring writes.
And Herring isn’t the only who’s studied this impact. The authors of a study on workplace diversity published in Personnel Psychology found that creating a pro-diversity climate in one large American retail company offered a an annual sales gain of almost $21,000. (Read more on that here.)
2. Diversity increases behaviors that lead to better sales performance.
Herring’s research also suggests that diversity is correlated with positive results in businesses, amplifying “creativity, problem-solving and performance.”
In short, diversity increases good behaviors at work. Other research has found this to be true.
A Gallup survey revealed that workplaces that are considered diverse experience the highest levels of employee engagement, where team members are more productive and profitable.
On the other hand, organizations with less perceived diversity experience active employee disengagement, which can result in lost productivity and time. And we know that’s costly for business.
3. Diverse sales teams bring an array of talents, perspectives and experiences.
This one’s a bit more obvious, but still worth mentioning. Whether we’re talking diversity in age, ethnicity, etc., every type of diversity adds unique skills and talents, new ways of thinking and different experiences and perspective. Companies are more able to “think outside the box” when they bring diversity into it. It also makes sales teams more accessible and relatable to a modern, global market.
Combining all of this together can lead to more well-rounded ways for get your team to its goals thus increasing revenue. And that’s what every sales organization wants.
If you’re thinking of bringing on more diverse team members, you should probably consider best practices for hiring. Check out this eBook on sales development hiring tips: