[vc_row][vc_column][vc_custom_heading text=”Decrease the Sales Cycle to Close Faster and More Profitably and Accelerate Growth” font_container=”tag:h2|font_size:32px|text_align:left|color:%23006688″ use_theme_fonts=”yes”][vc_column_text]One of the core elements of accelerated growth is the development and maintenance of a sales pipeline strategy. Accelerated Growth as a business strategy is to achieve 2x the growth in an industry or vertical market. In our blog post, Is Your Business Ready for Accelerated Growth, we discussed having sales take the lead in the organization and the importance of aligning the organization behind sales while focusing on a strategy of winning customers.
Elements of Sales Pipeline Management
There are a few core elements to building an effective sales pipeline to drive accelerated growth:
Customer Relationship Management
An application that enables you to collect, store and manage information about contacts ranging from simple contact information to social media platforms where you can engage the target or learn more about their employment history, skills, connections, lifestage and interests. Collecting information on contacts will eventually include responsiveness to campaigns, conversations, participation in webinars, content consumed and forms and actions completed on digital assets. The goal is to build a persona profile that enables you to assess the best method for approaching a contact to move business forward.
An application that assigns a potential value to the contact to assist in sorting high value opportunities from low value opportunities. Every single contact in the database MUST have a value assigned to them. Without a financial value, they are “valueless” and will not enter into the sales effort. Successful management of Opportunities will enable sales to accurately forecast new revenues and customers and allow the organization to prepare for boarding new customers and manage accelerated growth.
Opportunity Status and Scoring
Every visitor to an organization has a status and a score used to help segment the active audience and identify high priority opportunities. We recommend the following structure:
These are visitors you might think could be a viable customer but they are anonymous or have no contact information linked to them at all. Suspects have an initial score of zero and increase in value if they consume content on a site or pass through a landing page from an ad. A suspect may be an ip address and should be assigned a value on creation at the lowest denomination.
These are visitors who engage with your business but do not seek contact. They may download case studies, product papers, or browse popular information designated for higher value customers. There is normally some form of information on a Prospect ranging from a company name and email address or a phone number to a full address, with email and phone. Because a contact record is complete, that does not make them a lead unless they request contact. This is an important distinction because it prevents sales from tracking “information seekers” instead of viable opportunities. Prospects have higher scores than Suspects because there is knowledge of content, contact information and desirable behavior.
These are Prospects who have actively engaged with your business and requested contact. The value of the Qualified Lead may come from the request for contact where the Prospect fills out information indicating products and services of interest. Opportunities are either systemically updated to reflect the average values of products and services or manually updated by marketing prior. Qualified Leads are assigned by marketing to sales based on vertical and availability.
These are Qualified Leads who have engaged with the business and received proposals and have responded positively to the business offering. Committed Leads are assigned the highest scores based on the products and services they select and are ranked highly in the sales pipeline as potential wins.
This is the stage that applies to some business and not others, but when a proposal is accepted and comes with a contract, this stage is important to manage. The reason why is that a viable opportunity can get “stuck” in a negotiation stage delaying the opportunity and making it harder to forecast. Many businesses do not use a contract and can skip this status.
This is the good news that a customer has been acquired. A proposal was accepted, the opportunity has been updated to reflect a more realistic value of the deal and the organization is going to be guided forward by sales to engage and board the customer. When working in growth marketing, a Contract Win is often categorized to assess why the customer selected the business to help understand the value proposition that was most compelling to close business.
This is the bad news that a customer will not sign the contract and includes several options.
Contract Lost- Postponed The customer is not prepared to move forward financially or organizationally
Contract Lost – Competitor The customer signed with another competitor
Contract Lost – Cancelled The customer cancels the project and was likely not a qualified lead.
Each phase of the Lost process is evaluated to understand where the Opportunity broke down and what stage to move the Opportunity to in the pipeline.
The stage after contract is to list the customer as a Buyer. A Buyer purchases an initial set of products or services. Buyers with partial solutions are often highly qualified leads for future sales efforts and are flagged to marketing for conditioning.
Customers are repeat buyers and are moved into an inside sales and marketing structure used for account management, customer development and retention.
Managing the Sales Pipeline
Accelerated Growth requires an intense focus on maintaining accurate information in the pipeline to enable forecasting new revenues and operational costs. Most sales and marketing teams using the pipeline approach assign opportunity value percentages to an opportunity based on status. The valuations might look as follows:
|CONTRACT LOST -COMPETITIOR||0%||$0|
|CONTRACT LOST – POSTPONED||40%||$10,000|
|CONTRACT LOST – CANCELLED||10%||$2,500|
Managing the sales pipeline is a joint effort between sales and marketing where marketing takes the lead in identifying Suspects and moving them to Qualified Leads before assignment to Sales. Sales moves the leads that are “warm leads” avoiding the cost and lost productivity with cold calls and ensuring the organization is focused on actual viable opportunities. Sales pipelines can also include the cross-sell and up-sell of existing buyers in the business to manage the account for higher sales and profits and is often assigned to account managers versus outside sales representatives.
The importance of pipeline management and development to accelerated growth models cannot be understated. Without a robust system to track conversations, documents, contacts, opportunities, campaigns and sales calls, the growth effort will drift into uncertainty on business that is coming and unable to address opportunities that are lost and postponed or cancelled.
We invite your feedback and thoughts on sales pipeline management. The sales process is a truly organizational focus during accelerated growth and understanding the importance of sales as a business process and applying resources to manage those process is one reason for successful growth efforts. Feel free to leave your comments and feedback, your opinions and experiences are valued.
Next in our series on Accelerated Growth: Tools of Enablement for Accelerated Growth