In two previous posts, I covered the first two steps in driving B2B revenue growth, assessing your current state, and achieving marketing and sales alignment. Both articles, and this one, are based on the BrightTALK Sales Expert Channel webinar, Assess, Align and Accelerate – 3 Steps to Power Revenue Growth that I did last month with my guest expert, Ron Friedman. You can listen to the on-demand version here.
After you have completed the assessment and aligned all your resources for maximum efficiency, it is time to do what I consider the fun stuff, crank up the engine you have created for maximum performance, revenue and profit. To put this in a different way, once the gaps are discovered and alignment steps are taken, you can structure all parts of the lead-to-revenue process for maximum output. However, just as with a manufacturing process, a gap in one marketing and sales area can reduce total output, so you need to optimize every part of the revenue generation process.
Adopt a More Profitable Funnel
One great way to optimize is to re-align your lead-to-revenue framework for what Marketo calls the New Buying Funnel. As the below diagram illustrates, by deploying compelling content and a great website, today’s marketing department can take the prospect much deeper into the process before sales engagement. This is much more efficient than handing off the lead earlier and frees your sales reps to spend their valuable time where it matters most – being trusted advisers (see below) and artfully guiding prospects on the buyer’s journey.
Practice Governance and Performance Management
During the webinar, Ron Friedman shared some important thoughts about how companies can track performance and drive continuous improvement in the marketing and sales functions (while keeping the assessment and alignment principles foremost). Here are five key lessons:
- Integrate new processes into the day-to-day operations of your company. It’s well and good to create new operating procedures, but you must systematize and monitor them to gain true efficiencies. These processes must become part of the DNA of the company and this does not happen by creating them and placing them in the company’s policy and procedure manual. It takes diligent follow up and monitoring on a daily basis for many months in order for this to take effect.
- Establish and monitor metrics. It is hard to improve what you don’t measure so pick your set of core KPIs, and review them on at last a monthly basis with senior management.
- Tie variable compensation to metrics on both the revenue and expense side. Compensation drives right behavior and right behavior drives revenue. Each employee should be able to read either the compensation plan or bonus program and understand the company’s business plan and strategy.
- Sales management should develop revenue forecasts monthly for a rolling 90-day period. This will cover short-term and mid-term planning. The accuracy of these forecasts should be 80% or > and represent 100% of the 90 day quota.
- Sales and marketing operating management review pipelines and metrics with their direct reports twice per month.
Upgrade Your Sales Relationships
One of the best ways to enhance revenue performance is to upgrade the perception that your prospects and customers have of your company, products and services, as well as the individuals that represent you – especially customer-facing sales reps. The below graphic shows four levels of relationship. As you move up the strategic staircase, sales cycles shorten, competitive threats lessen, and bigger deals happen.
- Be unique in terms of what you offer and how you deliver what you offer. Undifferentiated commodity providers usually start and stay on the bottom two rungs.
- Seek to serve, not to sell. Prospects can sense your motivation and if it is only on getting the order, your value to them will decrease. However, if you are known as someone who has valuable information, and solves problems, your value skyrockets.
- Stay consistent. Do not change your message every time you perceive it to be advantageous. Trust is hard to come by and harder to keep.
- Be reliable. Always honor your commitments and insist that your entire support team – from the shipping clerk to the CEO – does the same.
Note that it is always better, and easier, to start at a higher rung on the relationship scale, then to work your way up the food chain. For example, vendors seldom end up as consultants or trusted advisors. Interestingly, I have seen companies and reps go down the food chain and this is painful for all involved.
An Example of the Three Steps in Action
Following is a short synopsis of the challenges we were facing at a major enterprise software company, the steps we took to address these challenges (assessment, alignment and acceleration) and the results that followed.
- Cost-per-lead of $150
- Less than 50% timely lead-follow-up
- Qualified lead leakage of 30+ %
- Pipeline coverage less than 80%
- Adopted marketing and sales SLA
- Implemented new buying funnel
- Developed intense lead-qual process
Results (over 2 year period)
- Cost-per-lead of $65
- 90+% timely lead follow-up
- Qualified lead leakage less than 10%
- Pipeline coverage greater than 110%
To achieve similar, or better results, follow the strategies in my three revenue growth articles. In the meantime, have a listen to our on-demand webinar: Assess, Align and Accelerate – 3 Steps to Power Revenue Growth. And of course, contact me at [email protected] if you need help in any of these areas.