Sales Evolution in a High-Risk Economy

These days it’s hard to have a conversation that doesn’t eventually roll around to the state of THE ECONOMY. What’s amazing is that, at this point, no one needs to use adjectives when they refer to THE ECONOMY. We’ve stopped bothering with words like “bad,” “down” or “tough.” We all know how things are, and we all know that, with the (possible) exception of a few people in and around 1600 Pennsylvania Ave., we don’t have a lot of control over when things are going to get better.

However, we do have control over how we’re going to rise to the challenge. To cope with today’s high-risk economic environment, you need to analyze your sales pipeline in order to identify sales drivers and work the leads that offer the lowest-risk revenue opportunities. Here are a few of the things you can keep in mind to help ensure sales success.

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1. Size is not all that matters. Size is important, but when evaluating your sales pipeline, it’s also important to take into consideration speed and certainty.

   Sure, closing a whale of a deal feels great, but I can think of several situations in which a series of smaller deals closed in succession would be at least as desirable — and maybe even preferable. Perhaps your company’s production capacity is limited. Or maybe a steady stream of revenue will provide the cash flow your company needs in these lean economic times.

   Remember that saying about a bird in the hand? Give me a pipeline with three smaller, low-risk deals versus a pipeline holding a high-risk whopper of a deal any day. Gambling is great in Vegas, but in business, shareholders, investors and your CFO prefer predictability.

   In short, evaluate close rates, deal size, and the length of sales cycles to better focus your resources. Bigger is great, but not always better.

2. Make new friends, but keep (and cross-sell) the old. It’s widely known that it costs less to cross-sell an existing customer than to acquire a new one. Because similar customers are more likely to share buying behavior, the best way to develop a cross-selling plan is to identify which products your customer is using, and which additional products similar customers have purchased.

   And, if you’ve already sold to customers in a particular industry or geography, your sales force knows how to close a deal with that demographic. Making inroads into a new customer base is a great way to expand your business, but pick the low-hanging fruit first and climb higher up the tree later on, as part of a long-term, strategic plan.

3. Keep your eyes on the road. I admit it. I was clumsy as a kid. I was more focused on my destination than on how I was going to get there in one piece. “Look where you’re going!” is advice that’s as useful in today’s business world as it was back then on the playground.

   The good news is that these days, companies can perform regular analyses that keep them agile and able to respond to needs and concerns as they arise. With regular and timely course corrections, you can stay on track and achieve your goals. By paying attention to checkpoints and keeping strategies flexible, you can quickly adapt to shifts in the market and not be left behind by more nimble competitors.

4. Matchmaker, matchmaker, make me a match. Sales and marketing. Marketing and sales. Theirs is a relationship you can’t afford to neglect. To truly understand your sales results and maximize the value of your sales and marketing resources, you must match your marketing campaigns to the leads and revenue they generate. Campaigns are keepers if they quickly and consistently drive the most leads, at the right lead cost per revenue achieved.

   However, keep in mind that a variety of factors contribute to the success or failure of a relationship. For instance, if your sales and marketing functions don’t “get along,” a marketing campaign can generate promising leads that are pursued inadequately by sales. A cursory glance might lead you to believe the campaign was unsuccessful, but a more thorough analysis will help you identify and repair the root cause of the problem.

5. Uncover the secrets of your successes — and failures. Success is not random. Your company has strengths and weaknesses, and you don’t want your competitors to be the first to figure them out. When targeting new prospects, let history be your guide and focus your efforts on industries, company sizes, and titles that tend to result in faster and more successful sales cycles.

   As with success, failure should be analyzed and understood — not swept under the rug. There may be clear signs of danger zones that your sales team can avoid. Deals with the public sector never seem to close? It may be safer to focus your efforts elsewhere.

But How Will This Help Me in 2009?

You may be wondering how these guidelines will help you succeed in 2009, which is already halfway over. After all, many of these guidelines require that you have a deep understanding of your sales and marketing information, which can be difficult to do without the right technology.

In a year that’s been defined by cutbacks, it’s easy to assume that any investment in technology is a bad idea. However, there is affordable on-demand analytics technology out there that will help your sales organization not only survive, but succeed.

However, what about the time required to get analytics up and running? After all, traditional analytics applications can take many, many months to implement. The key is to look for an on-demand solution that doesn’t require significant IT resources and is quick to deploy and easy to use. On-demand solutions are typically offered through an affordable, monthly subscription, so they can often qualify as an operating expense, which is more likely to be approved when budgets are tight.

It may be tempting to dismiss THE ECONOMY as an anomaly — kind of like a 100-year drought — to which you should respond by hunkering down, focused only on survival. However, this view fails to take into account the ways in which your strategies and tactics can evolve to help you succeed in this environment.

Fortunately, you don’t have to wait years to develop new ways to compete. With the right solutions, you can quickly gain the focus, discipline, and effectiveness you need to avoid extinction and make a move toward the top of the food chain.