We are in the business of helping EOS® companies grow revenue. Over half of the businesses that come to us with that goal in mind are wanting to do so by generating more leads.
As we work with clients to develop an initial Revenue Growth Plan, it typically becomes clear that the quickest way to move the needle on revenue growth is by focusing on their clients, not on generating new leads.
Compare this to the process of dating. There are two primary outcomes for a single person to date:
- Long term: To find a long-term partner to share their life with
- Short term: Sharing time with different people that may have different interests and perspectives, but without needing to share the same long-term goal
Having spent my adult life on both sides of this coin, I see that both have their merits. I enjoyed the process of dating itself, and I am now happily married. If you’re looking for a long-term partner in life, it is important to find someone with that same goal in mind and it’s even more important to find someone that shares the same vision as to what a long-term partner in life really is. This is not as important for those that are just looking to enjoy dating.
In the interest of self-awareness, it is valuable for the dater to begin with the end in mind and know which one of these outcomes they are pursuing when they are dating.
So how does dating relate to revenue growth? The leads are like dates. Are you looking for leads for the sake of dating, or are you looking for leads that share your vision of what a long-term relationship with a client is like? If you’re trying to build a sustainable business, the long-term approach makes a lot more sense; it’s a lot less expensive and a lot more fun. According to Bain & Company, a 5% increase in retention results in a 25-95% increase in profitability.
In our Revenue Growth Workshops, we help our clients look at the entire experience that a prospect or client has with their business — from the time the prospect knows they have a problem to the time that they become a client and are enjoying all of the services and solutions that our clients have to offer them. Businesses that initially think they need more leads typically realize that:
- The most efficient way to grow revenue is to look at increasing their value to their current client base
- The experience that they are introducing leads into is not optimized to win, retain, and scale efficiently.
Prioritizing what to do first is a very important decision. If you decide that you want to start bringing in more leads before you optimize the whole experience that they will go through, it can be very expensive and frustrating in the long run.
More often than not, we end up helping clients improve the experience that their current customers have with their business before looking to generate more top-of-funnel leads. Once the client experience is improved and optimized, not only can you generate more business from those current clients, but you’re also ready to close and retain the leads that you bring in.
Back to the dating analogy, if you are pursuing a long term partner, but don’t have a good vision as to what life looks like in that scenario, it might be difficult to find the right partner, and even more challenging to achieve long-term happiness.
Harvard Business School professor and the father of modern marketing, Theodore Levitt, asks a powerful question that every business leader, sales representative and marketing manager must answer: What business are you in?
The answer to this question will determine the future of your company. At this critical moment when the needs of your customers are changing, this question needs to be answered correctly.
The reality is that what you sell and what people buy are different. As I say in my book Revenue Growth Engine, “Buyers don’t buy products, they buy the outcomes the products deliver.”
Theodore Levitt would famously walk into his marketing class holding up an electric drill bit. He would tell the class that no one has ever purchased a drill bit, but what they bought was the hole. Some take it a step further and say that they aren’t buying the hole, they are buying the ability to hang a picture on the wall so they can look good to their friends. Others takes it even further, observing that the reason we want a picture on the wall is because of a primitive need to be part of a community, which will help ensure our very survival.
The point is, the buyer only bought the drill bit because they wanted the outcome the drill bit provided: a hole, a picture on the wall, the admiration of their friends, the ability to survive or some combination of the above.
What business are you in? When industries answer this question incorrectly, they set themselves up for failure.
Theodore Levitt also used the railroad industry as a case in point. The companies thought that they were in the railroad business when what customers were really buying was transportation. Had they seen this, they might not have lost business to transport trucks, buses, cars and airplanes. Instead, they would have seen the railroad as a means to deliver the outcomes their buyers wanted: getting conveniently and cost-effectively from point A to point B.
Gasoline stations can also be used as an example. Many think they are in the gasoline business. The reality is that nobody wants to buy gasoline. It is expensive, smelly and damaging to the environment. What they want is the outcome of being able to get to work, drive the kids to soccer practice or go on vacation. Gasoline is just a means to deliver that outcome. As soon as someone comes up with a better way to get the outcome, gasoline stations that don’t adapt are dead.
Dell thought it was in the computer business. As a result, it focused on creating an amazing supply chain that could deliver a cheap computer. Apple realized that it was in the business of helping people create ideas and share them. Computers (and iPhones, iPads, Apple Watches, Apple TV and the related services) are just a means to deliver the outcome its buyers want. As a result, Dell is struggling while Apple dominates the stock market.
Most businesses think they are in the business of delivering a product or providing a service. For example, if your business sells copiers, you may think that you are in the copy machine business. If you are an accounting firm, you may think that you sell tax preparation services. If you are an IT company, you may think you sell technical service.
The way to get the correct answer to this question is to consider the outcomes that our customers want. If you sell copiers, the outcome your customer wants may be an efficient office and professional documents so they can grow their business. This type of business might ask the question: What else could we deliver to help our customers get these outcomes?
If you sell tax preparation, the outcomes your clients want are to reduce their tax burden, get a faster return and reduce the risk of an audit. Rather than market the tax service, what if the agency’s message led with the outcomes they deliver.
If you sell IT services, your buyers probably don’t understand what you do. The outcomes they are buying are uptime so they don’t face the cost and frustration of downtime stopping their business. They are buying security so they don’t face the cost and embarrassment of a data breach.
What business are you in? What outcomes are your customers actually buying from you?
In the aftermath of the Covid-19 crisis, these questions will be especially important because the outcomes that your buyers want may have shifted. Recent Gartner research gave insight into the shift in outcomes buyers want. Before the crisis, 2019 research showed that “55% of organizational redesigns were focused on streamlining roles, supply chains and workflows to increase efficiency.” After the crisis, the desired outcomes have shifted to things like agility, flexibility and resilience.
Avoid being short-sighted. Focus on the outcomes your clients want and you have a much greater chance of earning their attention and their business. In the process, the shift of perspective might also allow you to see new ways to deliver the outcomes your clients want, creating new business opportunities.
Originally published on Revenue Growth Engine.
The reason to buy a company is to take what you purchased and grow it. Unfortunately, what often happens is that companies let the customers of the companies they acquired slowly get picked off by the competition. Instead of growing the new base of customers, the new base dwindles away.
You can buy a business but you cannot acquire customers. Keeping customers requires trust. After an acquisition, that trust must be built.
When we buy something big, we all experience buyer’s remorse. It’s that moment of time where we are nervous that we made a bad decision. (You may have some buyer’s remorse on the company you bought!) At that moment, the sale is very vulnerable to cancelation.
The same thing happens to customers after an acquisition. The customers of the acquired company get acquisition remorse. They are nervous. The customers of the company you acquired are vulnerable.
Sprint has provided my cellular service for over 10 years. Recently, T-Mobile acquired Sprint. Personally, I identified with the Sprint brand, seeing it as a maverick against the giants, AT&T and Verizon. I enjoyed the benefits of unlimited data and good pricing.
Following the acquisition, I’m nervous about T-Mobile. I don’t know much about their brand. Right or wrong, I see T-Mobile as a discount carrier. I’m concerned about losing my unlimited data and favorable pricing.
Several months into the new relationship, I’m impressed with how T-Mobile is handling the transition. In this article, here are a few things I’ve noticed that we can learn from T-Mobile.
Explain the Main Benefit
The first thing T-Mobile did was explain the benefits of the acquisition. I received several emails and letters explaining that the combined resources of the companies will allow me to not only keep my unlimited data, but also get access to a more robust 5G network. They have backed this up by carpet-bombing TV commercials to reinforce that the new company has more 5G coverage than AT&T and Verizon combined.
I’ll admit, as a customer I was nervous that Sprint was falling behind in the race to the fast internet that I want. The primary message of the acquisition is that we are not vaulting ahead of the established players. As a trailblazer, I like this.
What is the main benefit that your acquisition offers your customers? T-Mobile buying Sprint gives me more 5G meaning I get to stay ahead of the tech curve. This helps alleviate my nervousness. What benefit could you offer?
The week that T-Mobile announced the acquisition to Sprint customers they rolled out T-Mobile Tuesdays. The very first perk was free access to the MLB Network for the rest of the season. Now, as I watch the Blue Jays, I feel goodwill towards T-Mobile. Since then, they have given me magazine subscriptions, 10 cents of gasoline, a T-Mobile face mask, and even a free Whopper. Every Tuesday, I look forward to the notification on my phone that tells me I have a new perk.
Another perk is Scam Protection. This handy app automatically screens out scam calls. I like that!
What perks could you offer to your customers? How could you build goodwill and make the relationship fun?
This may sound like unnecessary fluff. However, when you buy a business, the customers are nervous and afraid. These are negative emotions. If they are not overcome with positive feelings of goodwill, your newly acquired base is at risk of slipping away.
Build the Relationship
I hope you have a consistent cadence of meetings and touchpoints with your current clients where you stay in tune with their business goals and challenges. (If not, starting Periodic Business Reviews is low-hanging fruit you should go after right away!) Build the relationship with your new customers. Don’t just send them a letter. Learn about their business goals. Get to know their people. Offer Periodic Business Reviews as one of your perks.
Building relationships into your new customers does two things. First, it protects the accounts. Second, it sets the stage for cross-selling additional products and services into the account. That’s where things get good. Not only do you keep the customers from the acquisition, you grow them!
Make a Plan
Are you planning to acquire a company? If so, I recommend that you make a customer retention plan before you do the acquisition. It is probably a good idea for every company to do this proactively so that when they do make a purchase, the plan is ready to roll.
Now, more than ever, we need to keep our growth engines running. Sales must maintain activity levels. Marketing must keep the digital lights on. This is not the time to slow down or stop.
This past week I’ve talked with many leaders that are facing hard choices. I’ve seen some companies make the first cuts in sales and marketing. I understand there are hard choices to be made in this season. There may be some fat you can trim that should have been done months ago. But overall, I want to challenge businesses leaders: keep your growth engines running.
Fortunately, it seems like the Small Business Administration is committed to keeping the American economic engine running. Low interest loans with favorable terms are available for leaders that have the guts to keep moving forward.
We have to keep the growth engines running.
This crisis will pass. When it does, companies that kept their growth engines running will be ready to help. Companies that shut down their engines will scramble to get going again. Many of them will not have the resources to get restarted.
Your Revenue Growth Engine is the sum total of your sales and marketing efforts. Together, these activities drive the lifeblood of your business: revenue.
Three Reasons To Keep Your Growth Engine Running
1. You Don’t Know When The Rebound Will Happen
Have you ever tried to time the stock market? That never works well for anyone. And even if you could time the market and get back in at the bottom, sales doesn’t work like that. In order to be there at the bottom, you have to be there. If you don’t have a sales team, you won’t be there and you’ll miss out on the rebound.
2. It’s Easier To Sustain Momentum Than Start Again From Zero
Your growth engine is more like a freight train than a race car. You can’t just go from a dead stop to 80 miles per hour. Revenue comes from relationships. Relationships are built and sustained over time. If you sideline your sales team, you can’t sustain relationships. If you turn off your digital marketing, you erode trust. Right now, we need to maintain momentum.
You might think you can restart when everyone comes out of their bunkers. The problem is that your revenue engine is like a freight train. It might take more resources to restart from a dead stop than it will to keep the train in motion. If you are able to restart from a dead stop, you might not be able to get in motion as fast as your competitors who kept their engines running.
3. It’s Our Patriotic Duty
Our government leadership have said that they prefer to help businesses keep people employed rather than pay out unemployment. It appears they are willing to help us weather this storm so we can come out strong. Why are they willing to help? If every businesses shutters their sales team and closed their digital doors, our economy will be in even worse shape, causing even more misery. We need to keep the engine running.
The Mindset of a Farmer
In sales, we talk about hunters and farmers. Hunting is fun because you see immediate results. If you have an opportunity to help someone right now, bag the deal.
Guess what? For the most part, we are farmers in this season.
What do farmers do? They cultivate the soil, plant seeds, and maintain their equipment.
Right now we are planting seeds. No farmer would expect a harvest immediately. This comes in time. Any farmer that doesn’t plan seeds right now is living in fantasy land if they think they can harvest a crop in six months. Sales and marketing plant seeds by being present, communicating consistently, and sharing helpful ideas.
Cultivate The Ground
Farmers till the soil. It’s hard, unrewarding work. However, for seeds to grow and bear fruit, this work needs to be done. Sales cultivates relationships by staying in touch with prospects and clients, empathizing, and offering to help. Marketing cultivates the ground by sharing helpful ideas that build trust.
Maintain Your Equipment
Farmers use the winter to maintain their equipment. Tractors are serviced and cleaned. Implements are prepared for the rigors of the next season. Sales needs to take this time to sharpen their sales skills. Marketing needs to take this time to maintain the online presence. Harvest will come and the companies that take this season to maintain their equipment will be ready.
What Should We Do?
Here are some ideas to keep your growth engine running.
Sales: Maintain Activity Levels
Sales must remain active. While things were going well, you may have managed yourself or your sales team based on hunting metrics: sales results. During this season of planting and cultivating, you may need to grow manage and reward your team based on top-of-funnel activity. You might adjust your comp plan temporarily to reward reps based on calls, social touches, sequences launched, and periodic business reviews.
Train your reps. Invest in your team during the off season so they can hit field ready to win.
Marketing: Keep The Digital Lights On
Marketing must keep communicating. When you stop communicating, you cease to engage in the digital world. Right now while we are working from home, we are undeniably in a digital world. For years, marketing experts have been urging us to build and maintain a vibrant online presence because our buyers are digitally-enabled and socially-empowered. How true is this now?
Does you message need to change in the short term? Yes. (Some ideas here: Outcomes Clients Want During a Crisis: How To Shift Your Sales and Marketing Message In the Short Term.) But you must keep communicating and stay digitally engaged.
This season for marketing to plant, cultivate, and maintain the equipment. Keep communicating by sharing ideas on your blog and social media. Take this down time to improve the website and refresh you sales collateral. Have you put off investment in marketing automation and sales enablement? Now is a good time to get this infrastructure in place.
Keep Your Growth Engine Running
Some companies will stop their engines right now. Sales people will be laid off. Marketing will come to a grinding halt. This will be done in the attempt to survive and preserve salaries for core employees. Here’s the challenge with this mindset: if you don’t have a growth engine you won’t have a company.
I implore you: find a way to keep your growth engine running. I realize hard choices need to be made in this season. However, the companies that shut down their growth engine will have a really hard time in the aftermath.
Companies that dig in, plant seeds, cultivate the ground, and maintain their equipment will be there to reap the harvest.
Article originally published by Darrell Amy on LinkedIn Pulse.
Originally published at the Revenue Growth Engine
One touch simply doesn’t cut it in today’s world. Salesforce.com research found that it takes 6-8 touches with a prospect to get an appointment. Sirius Decisions found that it takes 8 to 12 attempts to reach a decision maker by phone, even when they’re interested in your products or solutions. Whatever the number, the point is simple: you must reach out to prospects multiple times if you expect to get results.
Salespeople need both trust and attention. These are earned by consistently reaching out with ideas that prospects see as helpful to achieving their outcomes. As sales reps are seen consistently offering up helpful ideas, trust is earned, appointments happen.
Unfortunately, many sales reps are “one-and-done” when it comes to prospecting. They make a call or send an email hoping to find a hot opportunity. When they don’t get through, then put a note to reach out again in another 90 days.
Today’s sales rep is blessed with many ways to communicate with prospects including the phone, email, direct mail, and a variety of social channels. While these multiple channels create opportunities, they can also feel overwhelming.
Every prospector knows the law of ratios. Only a small percentage of dials will get through. SPAM filters combined with the sheer volume of email most people get means only a handful of emails you send get read. Direct mail is similar with only a small percentage of items getting more than a glance. Social media posts only get seen by a small percentage of your audience that happens to be scrolling when you post.
Smart prospectors realize that getting in touch with the most prospects requires flexibility to communicate over multiple channels.
Look at it this way. Let’s say you only get a 1% appointment ratio on the following four communication channels: phone, email, direct mail, and LinkedIn. If you add all of these together, building a multi-channel prospecting strategy, you could get a 4X bump in your results.
In today’s environment, the formula for prospecting success is as follows: Reach out to prospects with ideas that matter. Do this consistently across multiple communication channels.
Fortunately, there is new technology that makes it possible to execute this strategy efficiently and effectively. I call these prospecting sequences.
What is a Sales Sequence?
A sales sequence is a planned series of prospecting touches using multiple channels over a period of time. For example, a sequence might flow as follows:
- Day 1: Email
- Day 2: Phone Call
- Day 2: Direct Mail Letter
- Day 3: Social Touch on LinkedIn
- Day 7: Email
- Day 8: Phone Call
- Day 9: Direct Mail Card
- Day 10: Social Touch
- Day 13: Email
- Day 14: Social Message
Over a two week period, this prospect would have heard from you up to 14 times. Remember, however, that not all of your messages will be seen. So, while 14 times may sound excessive, in reality, it takes a lot of touches to get through.
Imagine how much you will increase the odds of getting through to your target accounts when you use a multi-touch, multi-channel sequences!
Ask any management consultant and they will tell you that processes are the key to an efficient business. We find processes in departments throughout a business like finance, H.R., service, production, and fulfillment.
Why is it that when it comes to revenue growth, sales and marketing teams typically have few, if any, documented processes?
In the Entrepreneurial Operating System, Gino Wickman asserts that process is a core part of an organization’s success:
“This is the secret ingredient in your organization. This means systemizing your business by identifying and documenting the core processes that define the way to run your business. You’ll need to get everyone on the same page with what the essential procedural steps are, and then get everyone to follow them to create consistency and scalability in your organization.”
While most departments have well thought out processes in place, sales and marketing teams are often left to wing it. “Go sell something.” “Manage our social media.”
The challenge is that when you have unpredictable processes, you get unpredictable results.
Because of this, many companies experience either inconsistent or flat revenue growth. This is a shame since revenue is the lifeblood of any business.
What are your processes when it comes to revenue growth? The Revenue Growth Engine™ itemizes the core sets of sales and marketing processes you need to drive net-new revenue and cross-sell current clients. Let’s consider these four process areas.
The Revenue Growth Engine™ Model
Net-New Business Processes
To drive net-new business you need defined processes for the two types of buyers: those who are actively looking and those who are not.
Process 1: Inbound Marketing
These processes ensure your company gets found by buyers looking online. It defines processes for converting visitors to leads, mining data for leads, qualifying those leads, and handing them off to sales.
Process 2: Outbound Selling
For every buyer that is actively looking for what you sell there are many more who are not actively looking but could benefit from your value proposition. Documented sales processes define who is the ideal client, how data will be managed, how reps prospect, and how they influence the buying team throughout the sales cycle.
What additional products, services, or solutions could you provide to your current clients? Most companies could quickly double their revenue if they got this right. Without defined processes in place, most companies experience anemic growth in cross-sell revenue. Both sales and marketing have a role to play here.
Process 3: Client Management
What happens after the prospect says yes to your offer? This is where most businesses drop the ball. Processes should be defined for onboarding a new client, conducting periodic business reviews, and renewing contracts. Without process, balls get dropped and cross-selling does not happen.
Process 4: Client Communication
Survey most clients and you’ll hear, “You never write, you never call, until it’s time for me to renew my contract.” Client communication processes ensure your clients feel valued. Documented processes need to exist for segmenting clients, managing data, communicating consistently with relevant messages, and delivering client loyalty programs.
Process 5: Update Your Message
In addition to sales and marketing processes to drive net-new and cross-sell, you also need processes in place to continually update your message. Your message is the fuel for your Revenue Growth Engine™. Make sure to have documented processes to refresh your website, sales collateral, advertising, and social presence.
How Are Your Sales and Marketing Processes? Do you have any? Are they documented?
Are you unhappy with your flat or inconsistent revenue growth? Maybe you should look at your sales and marketing processes!
If you’d like to take a deeper dive, consider inviting the team at Convergo to conduct a Revenue Growth Workshop with your team. Our team will help you diagnose your current Revenue Growth Engine™ and develop a plan to create and document processes to help ensure consistent results.
Originally published on Revenue Growth Engine.