Tag: B2B Sales

Churn Rate vs Retention rate – What’s the difference?

Customer retention is directly proportional to customer loyalty, reflecting how satisfied your customers are with your products and services enough to return for more. This goodwill is a crucial metric, particularly during a business’s growth phase. Understanding your customer retention and churn rates is essential, as these metrics help pinpoint loyal customers and those at risk of departing, allowing you to devise effective strategies to retain them.  What’s the difference between churn rate and retention rate? Simply put, churn rate is the percentage of customers leaving your organization while retention rate is the ones that stay with you. You can influence retention positively by aligning on controllable factors like quality of product or services or by enhancing customer support. However there are some uncontrollable factors like customer’s budget, changes in processes or objectives or other factors that you won’t be able to influence directly. It’s always good for an organization to aim for a higher retention rate and lower churn rate.  What is the customer churn rate? Churn rate can refer to everything from boycotting a brand to opting out of their subscription services to frequent product returns or poor ratings. A higher churn rate can lead to you spending more money on acquiring new customers which is not sustainable in the long run. If your business is in its earlier stages, a churn rate of 3-7% is agreeable. But you however need to try to bring down this number as well as you go further years in your business. Calculating corn rate is necessary for a business to see how well it is performing. How to measure customer churn rate? Churn rate is measured by taking into account the number of customers you lost over a specific period to the customers you had at the start of the period. One thing to note is that it does not take into account the additional new customers you acquired during the same period. No. of customers at the start of the period – No. customers by the  end of the period ———————————————————————————————X 100 = Annual Churn Rate The number of customers at the start of the year    For instance in the FY 2022-2023 you started off with 1000 customers and by the end of the year you lost 300 customers, your churn rate is 30%. What is customer retention rate? Retention rate signifies the amount of customers who have signed up for your products or services and continue to use them after the first cycle as well. A higher retention rate has a better ability to predict your future. You will have a fair idea on how much money is going to come in so you can make your financial plans better for investments and expansions.  How to calculate retention rate? Retention rate = (Customers at the end of a period – Total new customers during that period) / Customers at the start of the period x 100 Retention rate helps you build better insights into specifications of your business. For instance, it will help you answer: What’s the most liked feature of your product that’s bringing your customers back? What sales or support actions contribute to higher retention or churn? What is the behavioral pattern of customers who stay vs the customers who leave? What is a good retention rate? One way to get an idea is by considering industry standards. For example, the monthly churn rate for SaaS companies is 3-8%, implying that the average retention rate should fall within the 92-97% range. Furthermore, we understand that the average annual churn is 32-50%, indicating that the average customer retention rate should be between 50-68%. However, it’s important not to solely compare your retention rate against the industry average. Why monitor customer retention rate and churn rate? Monitoring churn and retention rates is crucial for analyzing your business trajectory. A high churn rate usually indicates a need for product improvement. Understanding customer preferences and behaviors towards your product, and then examining churn or retention figures, can help identify specific areas for improvement. A high churn rate often signals potential business decline. Customer churn can be due to various factors like pricing, product or service quality, or a mismatch with customer needs. It’s important to remember that customers evolve over time and it’s crucial for you to adapt to their changing needs. Poor customer service can also contribute to churn. Key account managers must foster strong relations with their clients, especially high-value ones, to ensure retention. Some ways to bring down churn rate: Implement processes and workflows: Consistency in customer interactions and service delivery can significantly enhance satisfaction and reduce churn. Establishing clear processes helps ensure that all customers receive the same level of service and support. Enhance communication: Personalized communication is key to understanding and meeting customer needs. Large organizations might benefit from segmented surveys to gather detailed feedback and adjust services or products accordingly. Adapt to customer evolution: As customer preferences and needs change, so should your offerings. Staying relevant and responsive to market changes is crucial for maintaining customer interest and loyalty. Proactive engagement: Identifying potential issues before they escalate can greatly improve customer relationships and reduce the likelihood of churn. Keeping a close eye on customer feedback and behavior can help preempt problems and demonstrate your commitment to customer satisfaction. How can a KAM tool help? A KAM tool can help you manage and enhance client relationships especially with the top revenue contributors. Here’s why you need a KAM tool to bring down your churn rate: Provides centralized data management – When you use a KAM tool, you’re essentially having the records of all your client information at one place. From account history to contact details and transaction records, you have everything at one place for easy access across teams for all stakeholders. With easy access to data you can serve and understand your customers better. Improved communication – With a KAM tool, you can record customer information, feedback, and preferences all at one place

Why Leadership is Important in Sales

In the ever-evolving sales landscape, organizations grapple with post-pandemic shifts. Efficient sales leadership becomes essential to navigate these challenges and remain competitive. Sales leaders not only set strategies and inspire teams to achieve results but also play a vital role beyond mere management. While motivational speeches matter, true leadership demands flexibility, keen observation, and the agility to adjust leadership styles to market changes for efficient sales. Different leadership styles intertwine with sales. Effective leaders reshape a sales department, fostering an environment where teams eagerly strive for excellence. By collaborating with other department heads, sales leaders cultivate a sales culture that propels sales and achieves revenue targets. Leadership Styles in Sales According to a study by Harvard Business Publishing, quality sales managers will play a crucial role in driving revenue in the post-pandemic environment. Let’s look at different leadership styles in sales and their suitability in different sales contexts: 1. Autocratic Sales Leadership An autocratic sales leader comes closest to the conventional idea of a leader who makes most decisions unilaterally and without any participation of the team.  Such leaders offer quick guidance to structured teams, especially in high-stress environments, allowing sales teams to focus without distractions. This takes the pressure off the sales team and helps them focus on selling without any unnecessary disruptions.  2. Transactional Sales Leadership Transactional sales leadership follows a result-oriented approach by promoting compliance and goal achievements. They thrive in mid-sized organizations with set sales processes, motivating teams with rewards, incentives, and commission strategies. Such leaders create and follow a system based on feedback, recognition, supervision and rewards.  3. Transformational Sales Leadership Transformational sales leaders are primarily mentors who focus on enabling sales reps with coaching and professional development. They focus on transforming and improving the sales culture of the organization. While they remain committed to the objectives and business values of the organization, they are also open to change. These leaders encourage teams to challenge the status quo, making them ideal for sectors needing continuous innovation.  4. Visionary Leadership Visionary leaders are committed to realizing the company’s vision and create the necessary strategy to guide the sales team towards this goal. Visionary leaders are highly organized and communicative and establish a sales culture that thrives on collaboration. They count on their EQ to win the trust of their team and inspire them to work towards achieving organizational goals. Visionary leaders have been instrumental in turning around companies after the pandemic and motivating sales teams to stay on course. Leading through Challenges The journey of a sales leader is often riddled with several challenges and they must possess the strength, skill and resilience to navigate challenges such as market shifts and competitive pressures. They should be able to handle changes in the industry, technology or overall economic conditions and pivot the sales team. Sales leaders can turn challenges into opportunities with these simple strategies and tips:  Lead by example: Successful sales managers shield their team from the storm and absorb most of the stress posed by challenges. They push themselves more to set the right example for their team members. First to arrive at work and last to leave, they are there for individual sales reps to help them adapt and get past challenges.  Leverage data efficiently: The ability to collect and analyze data efficiently is integral to sales success. They can’t afford to get buried under data and lose the plot by tracking too much or too little. Numbers can be accurate indicators of performance and leaders should be able to use them correctly to diagnose issues in the sales process.  Show empathy: Any crisis or challenge can make or break a team and it’s up to the sales leader to hold fort by displaying empathy for team members. They must be appreciated for their efforts and encouraged by sales leaders to stay on track.   It is also important to recognize and reward the contribution of sales reps who perform well under pressure.  Communicate a clear strategy: Adversity turns sales leaders into wartime generals who communicate a clear vision to their team members. The only way to weave a tight team is by clearly communicating your expectations and conveying the conviction of getting past difficult times. Developing Sales Leaders Effective leadership is the result of many years grooming and nurturing leadership talent within a sales organization. The sales leadership role is right for someone who understands industry challenges, market dynamics and is adept at negotiating and closing deals. Successful sales leadership requires a certain skill set and the following essential attributes: Integrity: This is a non-negotiable quality of any great leader and goes a long way in inspiring their team and earning their respect and trust.  Adaptability: Leaders need to stay abreast of latest technologies, industry trends and market dynamics to lead their team in the right direction.  Decisiveness: Sales leaders are required to take many calls that decide the course of the company and its success. They should be able to process data, choose from different options and make quick but informed decisions. At the same time, they must enable their team members to make decisions and groom them as thought-partners.  Humility: A good leader should be aware of his/her strengths and weaknesses and balance them with those of his team members. They should possess the humility to recognize their flaws and leverage the strengths of others who are stronger in these areas.  Fortitude: Good leaders are made of Teflon and can endure tough conditions while retaining the zeal and drive to meet their team’s goals. Only a strong leader can inspire other team members to look for opportunity in adversity and stay focused. Success Starts at the Top Good leadership is critical for the success of not just the sales team but for the future development of the company. Sales fuels the growth of the organization and good leadership is the catalyst that can turn around a company’s fortunes. Success stems from the top and a good leader can be the

Commanding the Digital Sales Battlefield: The Strategy You Need Now

Yes, sales, as we knew it, is history! Old-school selling approaches are going out the window. The Rolodex, the cold calls, the scripts practiced in front of the mirror – are all fast fading into the background.  Welcome to the digital age of sales! Sounds intimidating? We’re here to ease some of that anxiety about going digital – needing to dominate the online landscape. Because diving head-first into the digital sales ocean isn’t just about chasing the latest technology; it’s about genuinely understanding your customer. With so much talk about technology and going digital, it’s easy to think that the revolution is just a technological one. But it’s equally about an evolution in mindset – a shift from transactional interactions to building meaningful relationships.  As Julie Lentz, Head of Industry Retail Sales, Google puts it: “Selling is a science, and an art. Data is the IQ and knowing what to do with it, or understanding the humans that make decisions based on that data is EQ.” – (Snippets from episode #11 of The Shift podcast) The tools have changed, but the core remains the same. Remember the excitement of sealing your first deal or the satisfaction of a handshake signaling a closed sale? That essence is still here, just packaged differently.  Today, sales strategy is like navigating a vibrant digital landscape. There are opportunities at every corner, beckoning you to explore. Digital-First Sales: What’s the Big Idea? As the digital age evolves, customers will continue to evolve from passive recipients to active participants. They seek more than sales pitches; they desire solutions, strategies, and partners to co-create value.  It’s less about ‘selling software’ and more about demonstrating how it can transform operations and yield ROI. Customers want tailored strategies that address their unique challenges, market positioning and growth objectives. This is not a small minority. According to Salesforce, almost 3 out of 4 customers expect this.  While efficiency might push you toward operationalizing sales, relying heavily on data and established patterns can overlook nuances of key accounts.  Key accounts demand rich, durable exchanges, beyond surface-level pitches. Every interaction, request for proposal (RFP), feedback, and even subtle pauses during sales calls – all reveal a company’s needs.  Here, technology steps in as an enabler. Acting as an accelerator, it helps sales personnel swiftly gain insights. This empowers them to be more strategic, build relationships and align stakeholders effectively. “Organizations have had to leverage technology to keep up with demand and manage operations. Technology brought value to processes, business operations, and intelligence. Clients who embraced technology quickly saw the benefits.” – Julie Lentz, Head of Industry Retail Sales, Google (Snippets from episode #11 of The Shift podcast)  Sales in the digital era is about crafting partnerships. While technology’s benefits are vital, it’s equally important to focus on genuine insights and let human touch drive partnerships. The goal is to deliver solutions that resonate with customers and elevate the partnership.  Data: Your North Star If there are questions or doubts about how to keep pace and remain competitive, the answer lies in data. Think of data like your GPS on this journey, guiding you through the maze of decision-making. A study by Salesforce revealed that salespeople who use CRM software are 40% more likely to close deals. Having relevant information and data at your fingertips puts you several steps ahead of those still playing the guessing game.  Based on a LinkedIn report almost half of all businesses that focus on social selling achieve their sales targets. And, close to 80% of companies relying on social selling do much better than those who don’t prioritize it. It’s not merely about posting content; it’s strategic engagement, similar to choosing the right networking events in the pre-digital era.  It’s not just about having the data. It’s about having the right data and leveraging it to tailor your pitches, understand market trends, and anticipate client needs before they even express them.  “Data is a tool that should save time and help sellers develop insights faster. Data should enable sellers to shine as insightful individuals. It should free sellers to be more strategic in developing relationships and in stakeholder alignment.” – Julie Lentz, Head of Industry Retail Sales, Google (Snippets from episode #11 of The Shift podcast)  Put Customers Front and Center Let’s consider an executive summit. Every detail – from the agenda to the keynote topics – is carefully chosen to resonate with the concerns, and appeal to the aspirations of the attendees.  Your sales strategy should mirror this meticulous planning. You must recognize that your client isn’t just another name on a spreadsheet – they are the main event! Each proposal, solution and presentation must feel as if it was exclusively crafted for them. You must speak directly to their challenges and ambitions. There are statistics to back this up. Forbes reported that customer-centric companies enjoy a profitability rate 60% higher than their counterparts. That’s not just a small margin; that’s a game-changer! It has also been well-cited that a genuine focus on customer experience can skyrocket retention by a minimum of 25%. These aren’t mere numbers; they’re clear indicators of the immense power of a customer-first approach.  Make use of your research, customer insights and industry knowledge to make every client feel special. Every single interaction and touch point should reflect your intention at creating partnerships aimed at mutual growth.  Ensuring your clients are in the lead is not just a smart strategy – it’s the foundation for lasting partnerships and sustainable business success.  Tech It Up! In the world of B2B sales, where securing deals could mean navigating through layers of decision-makers and procurement systems, technology isn’t just an option – it’s your competitive edge. The days when sales decks were manually updated and leads tracked in bulky files are long gone. Today, businesses are employing advanced Sales Engagement Platforms to automate and optimize every step. Predictive Analytics have become the go-to for market trends forecasts and client needs prediction. Digital evolution isn’t

Automate to Accelerate: Streamlining Sales Processes for Greater Efficiency and Productivity

Automate to Accelerate: Streamlining Sales Processes for Greater Efficiency and Productivity Automation of standard and routine tasks is one of the biggest trends that is shaping the modern business landscape. Top companies and organizations are keenly embracing automation to drive cost efficiency and improved sales. Automation in the sales realm is proving to be particularly useful as it helps streamline several processes resulting in higher productivity and efficiency. Several new-age tools are being adopted to eliminate or reduce the time spent on tedious or administrative tasks and free up bandwidth for sales reps to focus on revenue-generating tasks. A cross-functional research conducted by the McKinsey Global Institute (MGI) reports that technology can automate almost a third of sales and sales operations tasks. For instance, messages shared by salespeople at different junctures of the customer journey can be automated. This simple automated task gives them more time to nurture leads to close more deals and consolidate existing customer relationships. Understanding Sales Automation To fully understand the application and benefits of sales automation, let us first understand what it entails. Sales automation is the process of leveraging software and digital tools to automate a wide range of sales processes from email marketing, to lead generation and sales forecasting. The most widely used tools for sales automation leverage artificial intelligence (AI) and include chatbots, virtual assistants, email, and appointment automation. For example, a gym sales CRM can help streamline tasks like membership management, client follow-ups, and appointment scheduling, improving overall operational efficiency. These cutting-edge tools are invaluable resources for sales reps and help them finalize more deals while establishing stronger relationships with customers. Sales automation tools can also be merged with customer relationship management (CRM) systems to provide smarter insights into the requirements of your buyers. By understanding your audience, their needs, habits, and pain points, you can customize and fine-tune your sales strategy and customize your campaigns to funnel leads through the customer’s journey. Lead Generation and Management Leads are generated in large volumes at the beginning of the sales process. Sifting through this ocean of data can be tiring and time-consuming. It’s also challenging for your sales reps to gauge a lead’s actual interest in your product or service. Thanks to sales automation tools, you can now prioritize leads, channel your team’s energy, and focus on the most valuable ones. By leveraging artificial intelligence, sales automation tools can simplify several tasks such as lead generation and lead scoring, and achieve maximum conversions and higher efficiency. During the prospecting stage, sales automation tools provide information about leads to sales reps and help them create a great first impression. Your sales team spends a lot of time and energy in qualifying leads and remains uncertain about conversion. They can now rely on automation of the lead prioritization process to qualify leads faster. Sales automation tools can ensure that prospects are right for your business before you start contacting them. This process is a boon, especially for organizations that face the challenge of longer sales cycles and low conversion rates. Sales reps depend on lead scoring to know the status of the lead in the sales process. By leveraging lead scoring they can decide if the lead is sales ready, a warm lead, or a cold lead. A sales tracking software can automate this process and help you identify people who are most likely to buy from your business. Instead of servicing every customer, your team can concentrate on interacting with warm leads and ensuring their conversion. They can also tap into automated lead enrichment tools to mine customer information from different data sources. This arms your sales reps with a comprehensive profile of prospects to nurture their relationship with them. Streamlining Sales Funnel and Pipeline Management It’s the aim of every business to maximize leads in their sales pipeline, as more leads result in more conversions and higher profits. However, managing leads and converting them requires more sophisticated tools than spreadsheets and email. With the help of sales automation tools, a large volume of leads can be managed in the sales funnel. AI-powered sales automation tools mine customer data and contact details and streamline regular communication apart from making product recommendations to customers. You can also utilize these tools to standardize and refine the sales workflow over time. Sales automation provides a holistic picture of your sales pipeline and aids in the identification of promising leads and opportunities. They also give you an overview of where the prospects are placed in the buying cycle and help you strategize successful conversions. Sales Reporting and Analytics Automation tools are also favored for their analytics and reporting capabilities. In order to stay on top of your KPIs and sales metrics you need access to in-depth analytics. These tools are a great asset as they are capable of automatically generating reports for stakeholders and managers. Sales leaders are increasingly counting on sales automation to spot opportunities and make data-driven business decisions. Automation is more relevant than ever as it helps in generating consistent data and processes for your entire team. With the help of automation, you can avoid discrepancies and duplications that might hamper your sales processes. By reducing the scope for human error, you can guarantee the accuracy of your data and findings. Integrating CRM and Sales Automation In these times dominated by digital innovations, optimizing the customer experience and staying ahead of the competition requires us to actively integrate our systems and create scalable synergies. By adopting Salesforce integration, we can bring together CRM systems and sales automation and streamline these processes. AI tools used in sales automation play an important role in understanding customers creating a deeper understanding of prospects. Data from various sources such as CRM systems, website interactions, and social media is analyzed to create customer profiles that are a big asset for sales reps. This is just one example of salesforce integration, and sales automation features are included in many CRM systems. Integrating these two integral platforms can go a long

Account Management Reinvented: The Role of Digital Mindset in Accelerating Sales Enablement

Consider these scenarios: Scenario 1: Before: “Good morning, Mr Brown. Thank you for meeting with me last week. Based on our discussions, we’ve created a proposal. It has just been mailed to you and you should receive it in a week. I look forward to continuing our discussions then!” After: The phone dings and announces “You’ve got mail!” A notification pops up – “Your proposal from The Good News Company needs your attention!” Scenario 2: Before: “Yes, Sarah! We’ve done business with Xtreme International for years, and that sparse file is all we have to show for it. Jacob, who handled the account for us was terrible at filing reports and updating records. When he left last month, he took everything he knew with him. If you need information, I’m afraid you’re going to have to start from scratch!” After: “Yes, they’ve been an important client for years. Everything to do with our dealings has been carefully recorded and stored in our Customer Relationship Management (CRM) system. Here, let me show you how it works so you can extract the data and information you need to service this account.” Scenario 3: Before: Brendon is trying to find the best contact within an important clients organization. He shortlists several people from previous reports filed. He must now call and find out if any of these stakeholders are still relevant to the task he needs to do. ‘There must be a better way to do this’, he thinks.  After: Brendon logs into his company’s Org Chart software. He is so pleased to be able to see, at one glance, all the key stakeholders in his key account. He knows immediately who can best influence the decision he will need when he presents them with a great growth opportunity. Any information he needs about his key accounts contacts is now at his fingertips. And it’s all up-to-date! Scenario 4: Before: “We’re sorry! There seems to be a recurring problem with this download. Check your internet connection and try again later.” After: Dear Ms. Johnson, we notice you’ve been having problems downloading our most recent whitepaper. Here’s a link that lets you have immediate access. We apologize for any inconvenience this may have caused you. We’d like to offer you a $50 discount on your next purchase with us. Do any of these scenarios sound familiar? Of course, they do! We’ve all been Brendon or Sarah or any of the others to some degree or another. But wait! Before and after what?? For those of you who haven’t guessed, the right answer is digital transformation.  Building a Digital Mindset Digital transformation is the integration of digital technology into various aspects of an organization. It has created a fundamental shift in how businesses operate and deliver value to their customers. It has become a strategic priority for all businesses, intending to stay relevant in the ever-evolving marketplace. One of the critical elements for successful digital transformation is creating a digital mindset within the organization.  A digital mindset is an approach to thinking that focuses on embracing change, adapting to new technologies, and constantly seeking innovative ways to solve problems and improve business processes. It’s about understanding the opportunities and risks associated with digital technologies and using them effectively to optimize business performance. In today’s competitive business environment, a digital mindset is no longer optional for businesses; it’s essential for staying relevant and competitive. As technology continues to evolve rapidly, sales teams must use modern tools and strategies to stay ahead of the curve and drive business growth.  Let’s explore how a digital mindset is powering the next wave of growth in account management and its subsequent impact on sales enablement. Watch Now: Prasad Varahabhatla (Senior Director, Sales & Data Operations at Philips) shares about Digital transformation within sales function  Understanding Key Account Management and Sales Enablement Before understanding the role of a digital mindset, let’s take a look at the fundamentals of key account management and sales enablement. Key Account Management: It’s a strategic approach to managing and nurturing relationships with a company’s most valuable customers or ‘key accounts’. These clients typically bring in the most revenue or have strategic value. Effective Key Account Management involves building strong relationships, understanding customer needs, and delivering exceptional service.  Sales Enablement: It’s the process of providing sales teams with the necessary tools, resources and training to sell more effectively. It includes everything sales teams need to better understand their customers, communicate the value of their products or services, and close deals successfully.  The Role of Digital Mindset in Key Account Management Check out our Masterclass to level up your Key Account Management on the topic ‘Making Account Plans Actionable, Measurable and Sustainable’  A digital mindset can transform Key Account Management, enabling sales teams to adapt and thrive in the ever-changing B2B landscape. Here are some ways in which a digital mindset influences Key Account Management: Embracing Technology: A digital mindset encourages sales teams to make the best use of technology to improve their account management processes. By employing digital tools, teams can streamline their workflows, automate repetitive tasks, and focus more on high-value activities, such as relationship-building and strategic planning.  Information-led decision-making: A digital mindset emphasizes the importance of decision-making based on the data available. Sales teams can draw on data analytics and AI-powered tools to gain insights into their key accounts, identify new opportunities and make more informed strategic decisions.  Personalization: Digital tools and strategies allow sales teams to offer a more personalized experience to their key accounts. By leveraging data and AI-powered tools, teams can better understand their customers’ journeys, preferences, needs and pain points. This allows them to tailor their offerings and communicate more effectively. Agility and Adaptability: A digital mindset creates an agile and adaptable approach to Key Account Management. This means sales teams can quickly adapt to changing market conditions, customer expectations, and technological advancements. This ensures they stay ahead of the competition.  Impact of Digital Mindset on Sales Enablement The

B2B Revenue and the (Ir)relevance of the Funnel

Originally published in Forbes Business Development Council Traditionally, one of the core concepts of sales and marketing is the sales funnel through which companies are supposed to move prospects from awareness through consideration to engagement, and finally to purchase. Here are three examples where this breaks How does funnel make sense if 67% of the sales cycle is completed on digital channels before contacting the company?  Opportunities from existing customers in the case of cross-sell & upsell start at the bottom of the funnel.  In case of ‘booked’ revenue, typical opportunities don’t get created most of the time, so funnel is not even in the picture here.    Is the B2B Sales Funnel relevant anymore?   One of the main issues with the sales funnel, especially in the B2B industry, is that the customer journey is no longer linear. Prospects no longer enter at just the top of the funnel. Customers come in at any stage and often jump stages or move back & forth between them. Since customer acquisition has changed within the B2B sphere, the sales funnel is a bit outdated.  What happens in a conventional sales funnel? Marketing generates a bunch of leads and passes the qualified ones to sales who then attempt to win the deals. Several B2B companies offer not only many solutions, but solutions that involve long-term engagements with their customers. For such organizations, winning the deal is only the beginning. In certain cases, Key Accounts are further identified which are given additional attention.  In order to bypass the inconsistencies that the ‘sales funnel’ approach brings, a shift in perspective might be necessary. What if B2B sales and marketing are seen from the perspective of distinct revenue streams? The 4 streams of revenue for a B2B Company There are four primary sources of revenue for any B2B company. New revenue – Opportunities from new customers Renewal revenue – Renewal opportunities from existing customers Booked revenue – Revenue contribution from existing contracts for a multi-year engagement. This is different from renewal revenue in the sense that product/services have to be delivered to realize the revenue. Opportunities rarely get created in the CRM for this stream of revenue. Cross-sell/ Upsell revenue – Cross-sell and Upsell opportunities from existing customers.  The approach to each of these revenue streams is different. Depending on which of the four sources contribute to the most revenue in your organization, the approach changes. The major revenue streams will determine the sales and marketing strategy, and corresponding sales and marketing tech stacks.  Which revenue stream is dominant in your industry?    Industries/ Revenue Streams New Revenue  Renewal Revenue Booked Revenue Cross/Up Sell Revenue Mid to Large Business Services  5-10% 5-10% 60-70% 10-20% Mid to Large B2B SaaS companies 15-25% 65-70% 5-10% 15-25% Mid to Large Manufacturing/Industrial 20-30% 5-10% 60-70% 10-20% Small companies / Early stage solutions 30-50% 30-50% 10-20% 10-20%   Depending on the industry and size of an organization, its dominant revenue stream varies.  For Mid to Large Business Services such as IT, Professional, Staffing, Marketing, Outsourcing, the dominant source of revenue is ‘Booked Revenue’ For Mid to Large B2B SaaS companies, ‘Renewal Revenue’ should be prioritized  For Mid to Large Manufacturing/Industrial, ‘Booked Revenue’ is the most dominant source  For Small companies – Early stage, commoditized or undifferentiated products/solutions- ‘New Revenue’ and ‘Booked Revenue’ dominate revenue streams.    A point to note in all these different types of industries, cross-selling and upselling are often the second leading source of revenue. This stream is also the biggest contributor for the account growth.   Revenue streams should shape your sales and marketing approaches.   Depending on which revenue stream is most dominant in the industry, the sales and marketing approaches should change. Each type of revenue stream requires different teams and different aspects of sales and marketing to be prioritized. This does not mean that there is no overlap between the sources of revenue or the sales and marketing approaches they require. However, it does imply that optimizing and streamlining them can help your ROI.   Winning the CFOs approval: How to Present RoI of a Key Account Management Software   What should companies seek in a revenue platform?   An ideal revenue platform enables a business to efficiently and effectively manage its revenue streams. Such a platform should have several key features that make it the go-to solution for businesses looking to optimize their revenue streams.  1. New Revenue Platform If you are looking to increase revenue from ‘New Revenue’ sources, it’s necessary to have a specialized tool that can help convert more deals by finding more leads with the aid of prospecting tools. Sales Tools for New Revenue A perfect sales tool for optimizing new revenue streams should ideally have Sales automation for repetitive tasks Visual sales pipeline management to track deals, manage sales stages, and monitor progress. Customer relationship management with a centralized database  Sales forecasting with insights for revenue forecasting and trend analysis. Gong is a great example of this – it uses AI to analyze sales conversations and give you data-driven advice on how to close deals faster. Such a platform captures and analyzes data from customer interactions to help sales teams make data-driven decisions. In case of large deal sizes, a platform like DemandFarm’s Opportunity Planner makes large deal management easier. Such a platform provides a systematic and collaborative approach to planning and closing large, complex enterprise deals. This is done by integrating proven sales methodologies with strong stakeholder management to enable faster deal closures.  Marketing Tools for New Revenue A perfect marketing tool for optimizing new revenue streams should have features including: Lead generation capabilities through various channels Marketing automation for repetitive tasks Customer segmentation to create targeted campaigns Analytics and reporting to track campaign performance, analyze trends, and identify opportunities for optimization. A tool such as HubSpot is an all-in-one marketing, sales, and customer service platform that helps businesses to grow and manage their customer relationships. Such a marketing tool enables businesses to create and track

Whitespace in Business: All about using whitespace analysis

Attracting new customers can be five times more expensive than retaining existing ones, according to a Forbes survey. The rush to increase market share makes organizations throw money at new customers, not realizing that their loyal customers might get disillusioned and leave. The effect is more apparent in B2B circles – retaining and nurturing current clients provides better return on invested time and money. Also, the process of helping current clients can reveal new areas of opportunity that can be beneficial to both parties involved. Such unseen opportunities, or white spaces, are almost everywhere in business interactions, waiting to be seized. What does WhiteSpace mean in business? The process of identifying gaps between what is being provided to a customer, and what can be provided to them using other solutions of the provider – is known as the process of white space analysis in businesses. Using sales data, organizations can identify opportunities to cross-sell and upsell, where customers are offered features that improve upon their existing/previous purchase. The process also requires thorough knowledge about the industry, competitors, stakeholders, and the solutions being provided. Insights into emerging industry trends. Executed correctly, white space analysis guides sales teams in identifying ideal customers for their organization, and offers them solutions that are aligned with their goals or issues. How Does White Space Analysis Work? The process starts with identifying gaps and highlighting potential areas that can be addressed, and is known as white space mapping. There are two types based on the way the mapping is focused on – internal and external. Internally focused mapping identifies the strengths of the organization’s solutions/products, and lists the strengths, opportunities, and areas of concern. Internal mapping helps highlight market barriers, and teams can work towards addressing the obstruction by offering new solutions, modifying existing ones, or targeting a different section altogether. Externally focused mapping lists the products or services that are succeeding in the market, analyses the ones that are failing, and identifies where potential gaps are. Key areas of focus during whitespace analysis Whitespace analysis is all about looking for value where others think none exists, and it can happen only if sales team members are actively sharing and updating the information they have about customers. This differs from the typical account management process, which can be represented as below: This institutional know-how, with the help of key account management software, can be structured into an enterprise memory that can be used by any and every member of the team and take up from the last interaction. The process requires teams to consciously focus on the customer and the business, and here are a few pointers for the same: 1. Arranging and understanding current data Previous purchases of customers is a good place to start, as it provides details on the services that customers need. Details like opportunity type, industry, account type, products used – can provide information about a customer’s state, and the details can be used to highlight pain points and how products from vendor organizations can solve them. For existing customers, the incremental charge they may incur to use the new feature/product should be clearly communicated. 2. Limiting market scope Sales executives joke about ‘anyone and everyone’ being their target audience; while this helps teams reach a wider variety of users, there are few products and services that are universal. Customers who end up disappointed because of wishful marketing can lead to bad word of mouth and lower sales. Clearly defining the target, therefore, holds a lot of importance. Identifying customer challenges, gaps between product and customer workflows, what consumes the customer executive’s time, and many other factors direct the retargeting efforts. 3. Keeping an eye on what competitors are doing A common misconception is to think of white space as an area where no competitors are present. This is never the case. There are several competitors almost always, and analysing their marketing tactics can reveal their strengths and weaknesses. Comparison to the expected customer profile/solution to their organizations, gives sales team members a way to identify the gaps in their solution. 4. Treating current customers the same Sometimes when vendor organizations try to  pitch for a substantial business, their existing clients might run into issues that need immediate attention. Learning and understanding their needs can also reveal potential white space opportunities. By asking the customers about improving their everyday workflow, sales teams can shortlist features and ideas that can improve overall experience. Opportunities for optimization, tweaks, or adding new features exist even in the most efficient companies. Being proactive assures customers that vendor teams are on the job all the time, and being receptive to feedback and responding quickly with a detailed response drastically increases the chances of them renewing their contracts. 5. Treating all new opportunities the same Since white space refers to the untapped areas of engagement with current customers, chances are teams ‘taking it easy’ are high. After all, they know the customers, or at least most of what is there to know. But after finding the right target and product, the next step is to leverage the data – no matter how well-acquainted the customer is. In fact, the pre-existing relationship can speed up matters, when sales team members directly reach out to the potential customer and set up a meeting. Other avenues, like retargeting them via marketing efforts or creating a product, service, or feature to address their problems can also take the relationship forward. Benefits of White Space Analysis Whitespace analysis leads to a better understanding of the buyer. Identifying the target market becomes easier, their pain points become apparent, and the overall customer buying journey can be analyzed. The knowledge gained from whitespace analysis can guide sales teams to customize their sales pitch to address specific customer needs. Identifying new customers and segments paves way for the expansion of the offering into newer markets. Increased customer insights can help  decide the target, the value props that should be highlighted, if the solution for the white space is viable, the effort

Sales Effectiveness In Strategic Account Management

Lego, the favorite toy brand for children and one of the most nostalgic ones for adults, had a bit of a downturn in the early 2000s. Back in the 1990s, Lego had begun innovating and expanding its product lines. What could go wrong with that? The brand new, action figure-like toys stood apart from the original brickwork that Lego had always been associated with. This shift worked terribly with customers, i.e., kids, who just wanted good old Lego bricks back. Lego almost went bankrupt in the year 2003, as Wharton’s knowledge base reports. Lego then had a change of systems. They first brought in a new CEO, Jorgen Vig Knudstorp, in 2004. His approach was to ask the kids what they want. Through extensive market research and efforts, he realized that they simply wanted to BUILD. They invested in a major, Cannes Lions-winning award campaign called ‘Imagine’ in 2006 and sustained it. They got back to the drawing board and recreated what they used to be best at. And they came back better. Fortune shares that back in 2015, Lego became the second biggest toy company in the world. Lego could have simply stopped the production of pre-built toys and gone back to what they were. But they decided to start things afresh by picking on each detail from product to sales to marketing and advertising.  This is similar to how sales effectiveness works. It doesn’t allow you to concentrate on a categorical problem. It forces you to look at entire processes and overhaul what’s needed to not just fix things, but make them better and effective. What is sales effectiveness? Sales effectiveness doesn’t have a very rigid definition, as you’d gather from asking multiple sales professionals. Let us look at the most concrete and sensible understanding of the term, after weeding out misconceptions. Sales effectiveness (over some time) = Average output per salesperson (based on company strategy) Where,‍ Output = profit/ revenue/ new product line sales. Further variables in this formula include what sales effectiveness refers to. It could be any of the following: Effectiveness at each stage of the process Effectiveness per territory, product, etc. Individual effectiveness against the average Effectiveness based on tenure Impact of investments on the effectiveness Further, the company strategy element here is crucial. Imagine your company is planning to push a new product line to slowly replace an older one. If your reps are very effective at selling the older line but not the newer ones, this effectiveness is futile. Key Elements of Sales Effectiveness in Strategic Account Management There is a lot of ambiguity surrounding sales effectiveness. Many confuse it with sales productivity and sales efficiency. To put some structure to the definition, you should take note of the following elements of sales effectiveness. Sales process: Firstly, you need to introspect and check if you have a real sales process. If not, you need to put one in place right away. If you do, you need to ensure that it exists not just for you and that everyone is aware of it. Next, ask yourself if it aligns with your target group’s purchase cycle. When you’ve ensured that all of these factors are aligned, check the effectiveness of your process. Opportunity management: How you manage your sales opportunities has certainly got a lot to do with sales effectiveness. This is also where account managers come in for strengthening wins. You need to have a clear sales pipeline with defined stages for appropriate opportunity management. Check if there are objective criteria attached to each stage. Not just this, but address the percentage of dormant deals in the pipeline. This is where effectiveness and efficiency both matter a lot. Another important factor is the accuracy of your sales forecasts. Sales enablement: Sales enablement is enabling your sales team to close deals with the help of resources they need such as content, tools, knowledge, etc. Sales enablement strategy is a function of both marketing and sales departments. Essentially, marketing does the research and studying and provides enabling material, while sales pass on critical information required for customers to make purchase decisions. Sales efficiency: Sales efficiency is largely a measure of the speed of sales operations. It is usually calculated for a quarter. Sales efficiency = Gross revenue of a sales team/ Costs incurred by the team Where, Costs incurred = salaries, perks, office space, training expenses, etc. Sales efficiency checks are used to uncover systemic issues in your sales processes. For example, is your sales cycle reasonable and feasible to the transaction size? How many meetings or calls does it take for a win? Introspect and nitpick within your sales process. Sales efficiency is all about taking a hard, critical look at your sales efforts and finding a starting point for improvements. Sales performance: Sales performance is the measure of your sales team’s efforts for meeting strategic sales goals. It is a checker for your sales team’s track towards reaching sales goals. There are a lot of quantitative metrics involved in studying sales performance. For example, what percentage of your sales reps achieve their assigned targets? How productive are your top 20%? There are revenue-generated, pipeline-generated, and opportunity-led KPIs for measuring sales performance. Your sales process, sales enablement efforts, and sales efficiency investments, all contribute to sales performance. For enhancing performance, keep highlighting areas of improvement, focus first on quality prospects, and make a tight yearly sales plan, among other measures. Sales skills: There can be a very long list of customer-facing and non-customer-facing sales skills prescribed for improving sales effectiveness. Customer-facing skills include prospecting, communication, discovery, business acumen, storytelling, active listening, presentation, and negotiation. On the other hand, non-customer-facing skills include technology, buyer research, time management, planning, judgment, and collaboration. Even though these are a lot of factors, focusing on each one can help you extract maximum effectiveness out of your sales reps! How Sales Intelligence impacts Sales Effectiveness in Strategic Account Management Sales intelligence is the need of the hour in a

How to Optimize Your Business? – Thanks to Sales Enablement Tools

Nowadays, businesses need the right tools and data to remain competitive in their respective market. This makes now the best time that you check out sales enablement software. These are solutions that provide your team with the proper tools, knowledge, processes, and functions to maximize every sales opportunity. Sales enablement is more than just about lead generation. It covers an umbrella of functions such as recruiting, hiring, onboarding, training, coaching, providing resources, and evaluating the effectiveness of certain programs within the organization. Likewise, sales teams are not the only ones who benefit from such sales enablement tools. It can also help marketing teams, human resource teams, and more. It syncs every department within your organization and ensures that their goals are aligned towards one goal, which is an increase in productivity and efficiency of sales. With that said, here’s how you can optimize your business with the right sales enablement tools in the market. 1. Synchronize source of content and data As mentioned earlier, sales teams aren’t the only ones who get to use sales enablement tools. It can affect your whole department as well. It does so by providing a centralized source of content and data for all departments. This source of content and information is critical for engaging with potential customers and closing deals with them. Having a single source of truth for all your content can help you create a more streamlined and organized sales enablement strategy. This helps sales reps and other teams reduce wasted time and efforts on searching for and using relevant content to use for their campaigns and operations. This centralized repository of data can also help you improve your sales account planning, especially if you integrate it with your customer relationship management (CRM) software. DemandFarm is a powerful account planning platform for integrated planning where you can connect your data with external sources for a holistic approach. 2. Personalize buyer’s journey With your customer data organized and aligned properly across departments, this makes it easier for you to personalize your potential buyers’ journey and experience with your company. After all, not all customers need and want the same thing. You would often need to use different tactics to close a deal for each prospective customer. Through sales enablement tools, you can create a relevant and personalized sales account plan for each respective prospect. This serves as a guide that contains all the critical information you will need to interact and close a deal with them. As more customers begin to look for genuine and dynamic interactions, relying on a scripted sequence for each sales pitch won’t be enough. You need to be in tune with your targets’ behaviors, needs, and wants instead of forcing them to fit into your own sales process. And since sales enablement aligns your sales team across all departments, they can get the needed data to learn more about their leads. 3. Streamline communication between marketing and sales team Marketing and sales team may have different functions and tasks within an organization, but they are inevitably tied with one another. A study by LinkedIn shows that 58% of aligned sales and marketing teams have higher lead conversion rates compared to those companies with teams that have poor communication. Sales enablement software can help you with that. It does so by streamlining content for both sides. What one produces, the other can use for its operations. These may be in the form of content, data, and reports. Likewise, it provides transparency on both sides to keep goals aligned throughout. Nowadays, this alignment between the two teams is becoming increasingly important for your business’ growth. With digital marketing blurring the line separating the two departments, these two teams must collaborate to ensure meaningful engagement with potential buyers. 4. Leverage data and analytics Nowadays, data and analytics have become an integral part of running a business. It helps generate relevant content for their brands, make smart decisions, develop better strategies, and create meaningful relationships with their customers. According to a report by the Havas Group, 81% of brands often go extinct because they no longer create relevant content for their customers. Meanwhile, only 19% collect and utilize data for marketing and sales purposes. This goes to show how much data can affect your business’ growth. One of the benefits of sales enablement is its ability to track and measure the performance of your sales process. You can gain insights from your interactions with your prospects and those who are engaging with your marketing content. This includes top-performing content, trends and prospect behaviors, and areas of improvement. You can use these insights to develop content and process to close deals faster and more frequently. 5. Improve customer engagement The different types of sales enablement tools are geared towards one thing, and that is to drive up your sales productivity and revenues. It would also help in sales acceleration and sales transformation. With the right data and relevant content, you can improve interactions with target consumers and create meaningful relationships with them in the long run. Engagement is essential when it comes to closing deals. The constant streams of communication ensure that your leads are nurtured, and your potential buyers remain interested in your company. Without that point of contact, all your marketing and sales teams’ hard work can fall apart along the way. Sales enablement gives you the necessary tools and data to keep engagement with your prospects and consumers relevant and effective. This includes videos, CRM, whitepapers, datasheets, and more. 6. Integrate with your other solutions The beauty of technology is that you now have other tools, devices, and solutions within reach to help you manage and operate other aspects of your business. Sales enablement applications are just one of the software you can integrate within your system. Having one software may sometimes not be enough. After all, no solution is one-size-fits-all. Sales enablement software has its limitations. Nonetheless, you can incorporate sales management software into your strategy to further enhance your

Land and Expand – The Ultimate Strategy For Business Growth

Imagine that you’ve just graduated from college and landed a job with the organization of your dreams. The salary is generous (to put it mildly) and there are immense opportunities for professional growth. All in all, it’s a perfect fit. On the third day of the job, you enter the CEO’s cabin and demand that she assigns you to the flagship project, doubles your salary, and promotes you on the spot. That escalated quickly, didn’t it? It is not supposed to (umm, never even think about trying this). In reality, you may have to showcase exemplary skills for years before being anywhere close to such atrocious demands or expectations. This is even applicable in your personal life and the analogy from Forbes hits home in that regard. This is nothing but a modest case of land and expand business strategy. Definition: What Is Land and Expand Strategy? Land and Expand is a business strategy that is based on three simple rules: Rule#1: Efficient selling involves a natural progression. Rule#2: Selling too much too soon can undermine deals. Rule#3: Current customers are the best source of income. In other words, land and expand strategy dictates a strategic framework under which the salesperson first focuses on landing a small deal with an organization (‘Land’). The goal is to first get the foot in the door. Now that he/she becomes a part of the organization, it gets considerably easier to explore opportunities for upselling and cross-selling over time (‘Expand’). For instance, let’s say that you work in a tech company that sells hotel management software. Your latest convert is a multinational hotel chain with tremendous potential for account growth. Under the framework of ‘Land and Expand’, you would go above and beyond and do everything in your power to overdeliver. This might mean providing hands-on training to their employees or constantly anticipating and addressing possible concerns even before they arise. Think about your favorite restaurant that sends you a free pudding with every order. Or your local store that provides free delivery even for low-key shopping sprees. The idea is to delight customers and exceeds expectations, forging long-term relationships. As HubSpot lays it down for newcomers, ‘Exemplary Service’ is key. Now, let’s say that the client loves the experience and a couple of hotels can significantly improve their day-to-day productivity, saving thousands of dollars every month. Imminent trust looms around the corner, ready to pounce at a moment’s notice. This is where you sweep in and start taking advantage of possible upselling opportunities, potentially introducing your software to hundreds of other hotels in their portfolio. What it Isn’t? Notice that we have cautiously used the term ‘business strategy’ in the above definition. Contrary to popular beliefs (and the lingo of marketing gurus), Land and Expand is not a sales strategy. It is a business strategy that masquerades as a sales model. It may seem that the sales team is doing all the heavy lifting. After all, they are the ones who plant the seeds and nurture them to fruition. But many variables are working in the backend to support their case. This can range anywhere from ideal marketing and pricing strategies to unmatched deliveries and focused vision. As evident, this is very different from the case of one user organically leading to 10 other users. Importance of Land and Expand Strategy Once you decide to implement this framework, you’ll find that it takes the center stage in everything that you do. At its peak, it may even be driving more than half of your entire revenue. If properly executed (a big IF), Land and Expand strategies can help you: Significantly increase your cross-sell and upsell rates while also protecting you from discounted deals. Reduce the overhead cost of acquiring additional revenues with fertile customer expansion strategy and retention patterns. Taper the risks associated with selling by increasing the number of customer touchpoints and conversion timeframe. Accurately pitch the value proposition of your offering to your clients with an extended sales timeframe. Land And Expand Process The first step is to keep track of new user signups so that a sales representative or a customer success representative may identify ideal customer early on, even before your product is widely used. A typical ‘Land and Expand’ strategy will include several activities, each will ensure the relationship with the customer is strengthened across all potential stakeholders. Cold calls, emails, in-person meetings for lunch or at events, webinars, linking one of your executives with the customer’s decision-makers, or even a quarterly business review are some of the possibilities. You’ll need to keep an eye on user acceptance of your product as you improve your relationship inside the customer’s organisational hierarchy. It is critical that you maintain your focus on product adoption at all times. Make sure you understand the broader potential use cases for your product as well as the commercial impact it will have. As the product gains traction, it’s time to take advantage of the relationship you’ve developed with the customer’s decision-makers. Your product’s advocates and power users will help persuade high-level decision-makers of the importance of implementing your solution throughout the organisation. Land and Expand Action Plan: How To Implement It? For the strategy to work, you need to have a repeatable strategy action plan that moves the customer from one milestone to another, irrespective of the pace. Such a framework should include steps such as: Acquiring small pieces of business within potential accounts. Servicing every ensuing task at extraordinary levels. Developing trusted relations with multiple potential stakeholders. Penetrating the business by encashing this trust at strategic touchpoints. In the context of conversion and engagement funnels, Hunter And Bard neatly presents the framework as follows.  At the ground level, this framework calls (rather, screams) for a support system in the form of sound practices. No Land and Expand strategy is complete without these: Right Off the Bat: Exceptional service should be the talk of the town from day one. Trust is an important