We see many businesses struggling with this problem across sectors and across all stages of the company lifecycle. Focusing on B2B selling, I’m tackling the problem over 3 blog posts. The first one below reviews the questions you need to consider before building a sales model that works for you. In the second post I’ll cover specific benchmarks using worked examples and in the third post I’ll offer practical advice on how to execute successfully.
- What is your average deal value? Is it $3500 as I experienced in building a software tools business. Is it $40k the average value of an niche engineeering business we are scaling? Or perhaps it’s $500k. This will be crucial to your go to market strategy.
- How do you successfully generate leads? What is the cookbook to convert those leads to deals? You need to understand the elements of the marketing mix that produces results. You need to understand the exact content that gets the hits and is passed on. The ROIs on trade shows, adwords, PR, marketing agencies you use. It all needs to help you understand the acquisition cost of a new customer.
- What is your average gross margin across your product mix? Sales targets need to be aligned to gross margin, the acquisition cost of acquiring new customers, the cost of retaining existing customers, and the OTE (On Target Earnings) of your sales team.
- What technical expertise is needed by your sales professionals to close deals.? In a material testing system manufacturer, we failed to scale the sales team with non engineering sales talent. No matter how talented the sales professional was, the conversation struggled when it became technical. Understanding the right questions to ask is one thing but understanding the answer and developing a conversation in that industry is impossible without the M&E engineering knowledge. A team of talented sales engineers are now scaling that business with impressive growth rates.
- Can the role of lead qualifier work in your industry? I’m convinced this role is fast becoming redundant. If you embed a world class sales process into your organization, the first oral point of contact the prospect has with your organization is key. It should be a Discovery point. It needs a highly skilled problem finder that most young lead qualifiers are not capable of fulfilling. These early stage Discovery calls are essential to the long term relationship you hope to build with a prospect. Highly trained sales professionals are very quick at qualifying out or in, a new prospect.
- Do I need to be face to face with my prospects to close a deal? An outside sales rep model is very expensive. I prefer a business model that can build a long term relationship with a customer on the phone, using webexes, on-line meetings, or Skype type technology. At the appropriate time Strategic Account Management can be deployed and a Land and Expand site visit is delivered to go after the bigger deals.
- Do all my products and services need the same sales model? The Saas model in software may justify a Relationship Sales Team dedicated to winning renewals, separate from the more green field business winners. Both teams are still likely to be phone based teams. The professional services you offer may need to be sold face to face. The accessories business could be sold straight off the web site.
- Is marketing totally aligned with the sales team? The marketing team needs to be clear on its main purpose – lead generation. But it’s more sophisticated than that. The marketing strategy in all its forms needs to be aligned with the needs of sales teams, sector requirements, specific people with specific issues need to be found and made aware of your story. Scaling a sales team will fail without an understanding of how marketing and sales align.
- Have you assessed the Economic Value of your market? Are all the sectors in your market worth going after? Aerospace may be a great sector for some companies but if you are an email marketing company which handles large volumes of email sends, are aerospace companies really a fit? In other words which parts of your market are worth your time? This will influence how you scale.
- Finally have you audited what other people have tried and failed or succeeded? Do you understand why they got the result they did? The world of selling has changed more in the last 10 years than at any time in history according to Daniel Pink in his latest book and I totally agree. The skills are changing. Investigative journalist skills are needed. People that can find the most relevant problem to solve are the new winners in sales.
What questions would you ask?