Building Your Sales Growth Engine
Sales is the lifeblood of your business.
Sales creates revenue. It ties all of your business activities together to the bottomline.
It goes without saying that your business can’t grow without sales.
In order to thrive, you need to have a sales process that’s effective at turning potential customers into buyers.
The Monetization Mentality
According to the monetization mentality, everything that you do as an entrepreneur should contribute to revenue improvement.
Any decision that you make in your business must make a positive impact on the bottomline.
That means, your business decisions should have measurable outcomes in terms of driving revenues. Increasing revenue can be done several ways:
- Increasing prices
- Getting more customers
- Improving average order value
- Shortening the sales cycle
Price hikes are obviously the fastest way to gain more revenue. But price increases are also risky because of competitive pressures. On the other hand, getting more customers requires either increasing the conversion from leads and prospects or developing new products and services for new customers.
Alternatively, you can work on increasing your revenue from existing customers through upsells to other products or services you already have. Last but not the least, you can improve the efficiency and effectiveness of your sales pipeline so you get more customers in a shorter time frame.
All of these ways for revenue increase entail increased investments. In business, you can’t make money without putting in money. For instance, you can’t justify a price increase without providing more value to your customers. And to get more customers and produce new products or services, you’d need to invest in improving your marketing, sales, customer service, and product development.
So the monetization mentality is revenue-driven, but it is also about making the investments that generate the most ROI. Having a monetization mentality is important for an entrepreneur because it helps you narrow down your priorities in terms of budget and resource allocations in your business.
Improving Sales Performance
Sales is basically how you monetize your business.
As an entrepreneur, you’re selling something: a product, service, or a combination of both. And you know that business growth depends on your ability to grow your sales. But increasing sales is often easier said than done.
Your overarching goal with sales is turning leads into clients in a systematic way. You need to have a predictable way of selling. This is your sales process. The sales process is how you get customers to buy so you can generate revenue.
So if you want to improve your sales performance, you have to work on your sales process. Your sales process needs to be simple and predictable. Think of it as your formula or recipe for getting customers.
Like a good formula, a good sales process would be simple to replicate to deliver uniform results. It would also allow you to easily measure how your sales is performing, as well as which aspects of your sales could be enhanced for maximum impact on revenue growth.
Knowing Your Conversion Rate
The best way of looking at how sales is performing is by tracking conversion.
To know if your sales process is effective, you have to know your conversion rate.
Your conversion rate is the ratio of your leads that you successfully turn into clients. A simple way to calculate your conversion rate is as follows:
Conversion Rate = (Number of clients that converted / Number of leads) x 100
So if you have 500 leads and get 20 to buy, that means your conversion rate is 4%. That’s not bad in itself, but you also need to benchmark your conversion rate with the industry rates. If the average industry rate is at 2.5%, then you know your conversion rate is actually pretty decent.
Optimizing Your Sales Pipeline
Knowing your conversion rate is useful in determining whether your lead generation needs to be improved.
If you’re getting a lot of leads but very low conversions, it could be due to one or both of these:
- You’re getting more unqualified leads or
- Your unique value proposition isn’t clear or is simply not persuasive enough
Oftentimes, a poor conversion rate comes from weaknesses in the lead qualification or lead scoring process. You need to have a good criteria for qualifying your leads so your sales efforts aren’t wasted on poor prospects.
Another problem is when you’re not clearly explaining the value of your product or service. Most companies focus too much on telling prospects how awesome they are. Check your own website and you’ll see that you’re always talking about you.
This would be fine if not for the fact that you fall short when it comes to illustrating the benefits you bring.
Unfortunately, people don’t buy a product or service just because they think a company is awesome. People may like you but this isn’t enough to convince them to do business with you.
People are ultimately interested in only one thing: what you or your service can do for them.
Improving Your Lead and Client Tracking System
When you’re a small business with a handful of customers, you probably have no problem remembering all your conversations with your clients. You could even remember most of their information, from their birthdays down to their pet’s names.
Once you start growing, however, remembering the names, titles, and companies of a few dozen clients can be a bit challenging. And this is problematic because your business growth depends on building and maintaining relationships.
Even if you’re in a B2B segment, sales decisions are still made by humans with whom you have to foster relationships with.
So you need to have a system that organizes all of your leads and customers. You can do this manually with the use of excel spreadsheets that contain information about your leads and your interactions. Or you can automate the process with a customer relationship management (CRM) system.
Whatever route you choose, the important thing is to have a system to help you track your interactions with prospects and clients. This way, you know what recent activity or conversation you had with each and every client and when you need to follow up.
Automating Your Sales Process
Sales automation can appear intimidating to many entrepreneurs.
It sounds fancy, which often translates to expensive. But beyond this, it’s a huge shift from what most entrepreneurs are used to. That makes it more intimidating than the perceived cost. Now you see why our first post emphasized the importance of having a growth mindset: your willingness to try new things such as automation can be a game changer for your business.
Automating your sales pipeline is basically using technology to streamline most or all of the manual, tedious, and time-consuming tasks in the sales process. It’s about making your existing processes faster and more efficient. As a result, the members of your sales team can focus on what they do best: sell.
Right now, most of your sales staff probably spend a lot of time doing manual tasks that are necessary for selling. Their hours are consumed by emails, data entry, scheduling meetings, and other tasks related to prospecting and qualifying leads. But most of these tasks can be automated. And with today’s tools, you can pretty much automate your sales pipeline without worrying about sacrificing customization and personalization.
For instance, most customer relationship management (CRM) systems automatically enter conversations with your prospect as well as their activities on your site and landing pages. This helps you learn where exactly your prospects are in the customer lifecycle. For instance, when a prospect accesses a specific resource or downloads a certain ebook, you know what kind of information they’re looking for. Having this information makes lead scoring easier for your sales team and also helps improve the relevance of your marketing efforts.
Aside from making your sales team effective, the most important benefit of sales automation is that it frees up your sales team from time-consuming processes. This allows them to devote more attention and effort to decision-making for closing and managing deals.
The Importance of Following Up
Here’s one thing you need to accept as an entrepreneur: sometimes your prospects just aren’t ready to buy.
Yes, they may have a problem and know it. They might even have started looking for a solution. But that doesn’t mean they’re ready to jump the trigger when they hear from you.
So you have to follow up with them. Most sales people stop after calling a prospect and getting a no once or twice. But in reality, it takes an average of 6 to 8 touches before a prospect is warm enough for the sale.
What this means is that you may sometimes have to step back to recalibrate your marketing messages. You have to keep nurturing your prospects so you can help them move in their buyer’s journey.
You have to stay with people until they’re ready. If you give up easily, then you might as well be leaving money on the table.
Growing Your Sales, Revenue and Profits
Growing your revenue and profits is all about growing your sales.
And sales growth is hinged on a repeatable, predictable process for turning leads into paying customers.
To successfully build the engine for growth, it’s necessary to improve critical aspects of your sales process. This means investing in better lead tracking systems and sales automation, and taking advantage of existing technology for sales enablement. By streamlining and automating your sales process, you’re also equipping your sales team to accelerate sales and setting your business up for increased revenue and profit.