Recently the Wall Street Journal reported on the challenges small businesses face hiring talent in today’s tight labor market. This can pose a significant challenge for businesses that want to grow revenue by growing their sales team.
As a former sales manager I understand the importance of growing the sales team to grow revenue. However, what do you do to grow in a tight labor market?
There are two ways to grow revenue:
- Add net-new clients
- Cross-sell more to your current customers
The math behind this is fun. If you show a modest 15% growth in net-new and 15% growth in the average revenue per client by cross-selling, you can double revenue in less than 3 years! Don’t believe me—see the chart below.
Question: What if you could only work with your existing sales headcount? Would it be possible to leverage your sales team to grow your customer base by 15% and cross-sell current customers into additional products and services to grow revenue per client by 15%?If you could do this, you’d double revenue in less than 3 years.
How would you pull this off? You’d need to get strategic about sales enablement and marketing. Let’s explore this further.
NET-NEW: INBOUND + OUTBOUND
There are only two types of prospects: those who are looking and the vast majority who are not looking.
For those who are looking, and inbound marketing strategy helps you get found online and convert the visitors to leads. A Lead Response Manager makes sure to respond to these leads within 7 minutes, qualifying them for the salesforce.
For prospects who aren’t looking (a.k.a. the vast majority of potential clients) you need an effective outbound prospecting strategy. To grow net-new revenue by 15% your sales reps need tools, training, and accountability.
First, they need tools. Picking up the phone, leaving a voicemail, and then moving on is not an effective strategy. Salesforce.com research tells us that it takes 6-8 touches to get a net-new appointment. Prospecting sequences that launch and automated stream of targeted emails, scripted calls, and social touches give your reps to prospect efficiently.
Second, they need training. How long has it been since your reps brushed up their prospecting skills? I believe that prospecting training should be a part of every sales team’s annual training regimen. It’s too important to ignore. (That’s why I’m excited that our team at Convergo is now offering Fanatical Prospecting, the best prospecting training I’ve seen.)
Third, they need accountability. You can’t manage what you can’t measure. Sales activity reports on a napkin don’t cut it. Fortunately, if you use prospecting sequences, the platform keeps a detailed log of how many sequences were launched and calls made. No hiding.
If you’ll commit to inbound and outbound to drive 15% YOY growth in your customer base, you’re half way to doubling your revenue.
How many new products, services, and/or solutions do you have to sell to your existing client base? This is what I call the low-hanging fruit!
Jay Abraham, my favorite marketing guru, says that we have a moral obligation to make sure our clients are getting the highest value possible from their relationship with us. You have services that would benefit your clients. It’s important, even essential, that you make sure they know.
You don’t have to cross-sell every client into your new services. However, if you’ll focus your marketing and sales efforts to grow revenue per client by 15%, you’ll have the other half of the revenue doubling strategy in place. Let’s explore how to do this.
The role of sales in cross-selling is to take care of clients. Every client should be classified by cross-sell potential. The clients with the highest cross-sell potential should receive periodic (quarterly) business reviews. Schedule a meeting to recalibrate on their business goals, review your results, and talk about strategies for improvement. This is the perfect time to begin to recommend additional products and services in the context of the client’s business goals. (While you’re at it, during the QBR ask for referrals to help you hit your net-new number.)
The role of marketing in cross-selling clients is to make sure they know about all you can do for them. How do you do this? Find every opportunity to communicate with them. Establish a regular communication strategy with a newsletter educating them about ways you can help their business. Share these ideas on your social channels. Have customer events. Send targeted emails to your clients who the sales team has tagged as candidates for specific cross-sell opportunities. Change your on hold message. Give your service reps leave-behind collateral. Use any and every method to get the word out consistently.
TAKE STEADY ACTION
In Great By Choice, Jim Collins tells the story of two teams competing to be the first to reach the south pole. One team followed the shiny objects. They got distracted. The other committed to a slow and steady 20 mile march every day, good weather or bad. The first team died without hitting their goal. The second team’s slow and steady approach won the prize.
What if you took a slow and steady approach? Instead of always looking (hoping) to grow by add to your sales headcount, what if you developed the team you have, setting a modest goal of 15% YOY in net-new? What if you took your high-value customers with cross-sell potential and held your reps accountable to do quarterly business reviews? What if you backed all of this up with inbound marketing and client communication?
You would experience growth. In fact, when it did come time to grow your sales team, you’d be plugging them into a Revenue Growth Engine that could drive even more results.