Companies making $800K to $7M in annual top-line revenue often all suffer from the same debilitating problem…and it’s related to scaling their growth.
In the beginning, I was surprised, but as I’ve spent the better part of a decade working with C-level executives and owners, I’ve found that businesses within specific revenue tiers typically struggle with similar things.
This concept is probably not an unfamiliar one to you – or, at least, it makes sense as you think about it.
Let me lead you down the path…
When we start working with companies at this tier, the biggest issue we find blocking their growth is not usually marketing.
It’s also not their standard operating procedures.
And it’s not usually financial management.
You may say, “Well, Duh!”
But hear me out.
I’m going to dig into the nitty-gritty of what aspects of sales are the problem.
Common Sales Team Misfires
Problem #1: Sales Functions as Order Takers
Usually, the problem isn’t a phone management issue. Companies in this tier are typically competent at taking sales calls and – more so at the higher end of this tier – often have scripts in place.
But, I don’t usually find many companies have an outbound system in place — they aren’t trained on hunting out in the wild.
Thus, a whole arm of potential growth is fantastically neglected.
Another typical issue I’ll see in this structure is missed revenue by not having someone manage the phones during days the company is closed, but leads still call in.
Problem #2: Sales Functions as a One Call Environment
I see this occur most often with sales teams who are functionally operating as an “order-taker” organization.
In this scenario, after they receive a call and it doesn’t close, there’s no follow-up plan in place to close those leads – not even an email series – which leaves a substantial chunk of revenue on the table.
Problem #3: Sales are Primarily Developed Through Referrals & Existing Relationships
I usually see this in 800K to 3MM companies. Rarely do I see companies grow past this revenue point if their sales system is primarily developed through referrals or existing relationships.
The problem is that this creates a pipeline issue and is ineffective at creating predictable growth.
There simply aren’t enough leads in this system to fill the pipeline and continue growing through this revenue tier.
Of course, there are companies that are successful in spite of the norm. But, they fall outside of what I typically see.
Problem #4: Sales Uses Legacy Sales Tactics
We’ve worked with manufacturing companies who were stuck in this spot, but were able to break their revenue growth free by making changes to their sales system and dealing with the primary problem I’m leading up to.
In legacy sales teams, mass emailing with general, minimally targeted sales copy is the primary tactic.
We also see mass phone calling with minimally personalized scripts being used and no real use of contextual selling.
The problem is that legacy tactics have increasingly become background noise to the target market’s ears…they’re immune to hearing the message.
And, in a world where people appreciate a relationship (something that breaks them out of the noise of the norm) and expect their experience to be customized to them, relational and contextually relevant need based sales is their North Star – and should be yours as well in terms of your sales experience.
“Because of Advertising Noise, Relational and Contextually Relevant Need-Based Sales is Your Prospect’s North Star – and Should Be Yours As Well.”
Problem #5: Owners Retain the Senior Sales Position Instead of Building a Team
Over the last five years, we’ve seen this management issue block revenue growth for several businesses trying to scale, typically past the $1M in annual revenue milestone.
Where does this happen?
Typically, when the Owner and the Top Sales Person are the same person.
In this case, businesses tend to stall out in achieving revenue scale.
Often it’s because the owner feels they need to control revenue by keeping the sales process to themselves.
After all, they are the best sales person for the job.
And this may be true.
But, it’s not scalable.
Even if none of the team can drive sales like they do.
In this situation, controlling the sales process does meet short term revenue goals.
But, it isn’t conducive to scaling sales because there isn’t a collective (team) knowledge about how to drive sales together.
And so this business’s annual revenue typically yo yo’s year after year, making it feel like there is an impenetrable glass ceiling that cannot be broken.
We know – we’ve lived through this feeling.
If you find yourself in this situation, don’t worry.
You can still find your way out.
But it takes a team.
The easiest place to begin is by learning how to build talent around you with outsourced resources.
It’s an efficient way to grow through revenue tiers until you can hire internally.
“The skills it has taken you to get to where you are today, are not the same skills it will take to get you to the next place in your business – let go”
Building a Success Strategy
For a business to be successful, sales are a must – and there is one defining feature we see for businesses that scale past the 7MM mark.
Leads…but not from where you think.
When I’m approached by businesses who want to build a scalable growth model, their head is usually in the marketing clouds.
- I need SEO…
- I need Paid Advertising…
- I need Ad buys…
But that’s not where their business is bottlenecked.
They are bottlenecked at prospecting.
And it can be one of the most effective, efficient channels for lead generation.
And I’m saying this to you as a marketing agency owner.
I regularly find that companies who have their sales processes organized with an effective prospecting system consistently grow through their revenue tiers.
“The key to scalable growth isn’t marketing first – it’s sales prospecting first”
Growth will be much slower for companies struggling with one of the four sales problems I mentioned above.
For quality growth to occur with marketing, a good need/context sales & prospecting system needs to be in place.
Otherwise, your company is misfiring in its revenue engine – even if you put more gas on with marketing.
You may go faster, but it sure won’t sound good, and puts undue stress on the whole system (not to mention the efficiency issues).
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Steps to Building a Prospecting Strategy Foundation
“The definition of sales prospecting is when inside sales reps make outbound calls or send outbound emails to leads in hopes of creating opportunities for account executives. Prospecting can involve cold-calling as well as reaching out to nurture leads that have gone cold.” – RingDNA
I would modify this definition.
Sales prospecting should include the idea of outbound sales activities, not just calls or emails.
Before you begin, there are elements you need to have in place before starting down the prospecting road.
So, if you recognize that the following items aren’t in place, get these in order before structuring your prospecting system.
- Clear Company Value Proposition
- Inbound Sales Scripts
- Ideal Client Outline(s)
- A note on understanding your target(s)…
If you haven’t gone through persona development, start there. It plays a key role in understanding the mind and needs of the ideal client you want to reach.
It’s possible that you may have more than one persona, or even five personas.
To begin with, just focus on developing your top three.
Common elements of persona development include things like:
- Purchase Habits
With these elements in place, let’s start building a prospecting plan.
Choose your Target(s)
Since you’ve already done your homework with persona development, this should be relatively simple – for the most part.
Make it Niche
Even though you’ve documented your primary personas, you may need to do further development.
Niching is a major key to success in prospecting and you may find you need to develop out your personas further as you zero in on a niche, or several niches, to reach out to.
Here’s an example…
If you provide management software for service companies between 3MM-15MM, your prospecting activities should dive deeper, targeting specific segments within the service industry – like Plumbing, Moving, or Carpet Cleaning – and identify what makes your targets different in each of those segments.
Identify Your Prospecting Tools: List Building Resources
Go ahead and choose where you’re going to get your list of targets. There are lots of resources for this available.
Resources can include:
- List Building Companies
- Cold Email Software Providers
- Your CRM (we consistently come across this scenario)
You may be surprised to find that you have contacts inside of your CRM who have never been targeted by your sales team, but have interacted with your website.
Whichever resource you choose, it’s time to start putting together your niche lists.
Build Your Target Messaging
Your messages should be characterized as (SEPTR):
- Easy to Consume
- Provides Value
- To the Point
- Relational & Need Focused
An example of this would be:
Subject Line: “First Name,” is your “Software Name” investment paying off?
A lot of companies have purchased “Software Name” (no doubt), but “Your Company” can help clients who want to get real ROI from the software.
“Client Example” is our most recent success story with “Software Name.”
Would it be worth a phone call to talk about our “Software Name” implementation guarantee?
Let me know if you’d prefer not to be emailed again. I’m not here to waste anyone’s time — I get it.
PS – We use a tool called “BuiltWith” to learn if companies we are interested in working with have ever installed “Software Name.” Just in case you were wondering how I knew you may have been using it.
How to Prospect: Build your Prospecting Sequence
This sequence includes all your activity – not just the emails you send, or phone calls you make.
An example of this would be:
- Day 1: Introduction Email
- Day 3: Phone Call
- If Left Message, Follow Up Email
- Day 5: Social Media Action
- Favorite a tweet and follow target profile on Twitter
- Day 9: Follow Up Email
You get the picture.
Often, the question comes up as to how many “touches” you should make in your prospecting activity.
I recommend 14 touches over a 6-12 month period.
Make sure your messaging and sequence matches your company messaging.
Otherwise, the mismatch will affect your brand revenue overall.
Effective Prospecting Strategies – Launch and Test
For your email outreach, I recommend using a software that allows you to A/B test your emails.
You’ll gain a lot of benefit from testing into a highly targeted, proven email sequence that yields improved results the longer you work at it.
I’ve spoken with many companies who start on a prospecting system without using software with iterative capabilities and drop their efforts needlessly.
The key to success with these efforts is in testing and optimizing your messaging and sequences.
Hopefully, you’ve found some value in identifying blockers to BREAK through your revenue barriers through sales prospecting.
Let me know your thoughts – you can connect with me on LinkedIn.