Guest Post by Mark Shalinsky – Business Development Manager at The New Office. Mark is a veteran sales guy that loves the hunt and metrics. He taught me some great techniques over the years including “whale hunting” at conferences, one of my go to strategies. In this article, Mark shares 3 growth hacks for sales involving long sales cycles and in person sales demos.
I had a call today with a sales leader of a small regional company looking to expand his sales footprint. While they have done a lot of great things in the past, have recurring revenue, an active inbound lead funnel, there is a lot that they can be doing to accelerate their growth using a few growth hacking techniques for sales.
About the company
The company, including the sales leader, has a three person sales team. The sales reps do everything; prospect, demo, close, and book renewals. Currently they are using an entry level CRM marginally better than spreadsheets, but they are committed to growth and have bought a license to the big boy CRM, Salesforce.com. The commitment is firm as they are using a consulting service to set it up for them.
The are not looking at a stepping up digital marketing right, the need to tune their sales reps first. For this reason, I will not discuss anything on marketing at this time.
About the solution being provided
This company has a powerful disruptive technology with a 95% win rate when they get to the demo. The problem is getting to the demo. The decision maker for their product is either the CEO or CFO and the demo requires a 30 – 60minute in person hands on demo.
Pretty time and labour intensive for a C-level executive. This seems like a lot, but with a 95% win rate, the demo is pretty much cash in the bag.
As well, the sales leader says he has a >90% renewal rate, so they can count on a very stable recurring revenue. Also this data was built on several years of successful sales so there is a nice annual recurring revenue (ARR) buffer that will help fuel this growth phase.
The Question: How can they accelerate growth?
Sales is hard.
Anyone who is in sales understands this. The reason there is the 80/20 rule is because while sales is hard, it is a catch all career, and many people don’t have what it takes and linger.
The first question I asked this sales leader, is the first thing I ask any sales hunter, “What is your funnel equation?”
The funnel equation
V # Calls gives
W # Conversations which leads to
X # Demos that convert to
Y# Commitments resulting in
Z $ earned.
Once you understand your funnel equation you can start working the dials and increase conversion rates.
Over a longer period (thing week or month) your funnel number should be relatively stable. My funnel is a bit more involved than most people’s but I like to know how many raw dials I do because some days I strike out completely. However, like a slot machine, I know that the more dials I put in greater chance of a conversation, and it cascades from there.
Full disclosure, I have no idea how slot machines work.
I know logging calls is tedious, however there are a lot of softwares out there that can link and log your calls in your CRM, once in your CRM you can easily measure and report and on them. At that point you can have your funnel numbers. Put it on a dashboard, have it motivate you to crush those numbers.
As well, I’ve previously written another article about my call logging methodology. In short, to save you from reading another one of my articles, every call can be noted in 140 characters or less and prefixed with one of a handful of annotations such that;
GVM: got voice mail
LVM: left voice mail
Call: spoke to intended person
Demo: ran demo
Close: closed business
Email: sent email and email logged (Yesware, Cirrus Insights,& Sidekick do this automatically and nicely)
Solutions to accelerating growth
Now that I’ve learned about the company, the solution, the process, I am ready to recommend some ideas to help them accelerate growth.
Sales Growth Hack 1: Hack the reps
As mentioned above being a sales rep is hard. The caveat is most of us got into sales to make some money and most sales reps are coin operated. The brutal part of this company’s equation is being able to reach the decision, so we need motivate the reps to reach the decision makers, and reach them more often.
The first of the growth hacking techniques is to make sure that the reps are making their dials, emails, and initial contacts in sufficient numbers. How do you do that? Incentivize the different stages of the funnel equation.
What better way than to make it a cash based competition?
For this to be effective and ensure that nobody is gaming system (within reason), two competitions should occur simultaneously; most dials in the week and most booked sales demos in the week. This way there is an incentive to making a lot of dials, more dials equals more chances of sales demos.
As well, the prize for most demos should be larger than the prize for most dials. In this way if a rep decides to game the system for most dials and wins, their win will pale in comparison to someone who did the work, did the dials and consequently booked the most sales demos.
The second rep hack is giving the rep the tools they need to book the demo. This is done by being different, being affable, and being spectacular.
How can you be spectacular?
Everyone loves an unanticipated gift.
First determine the customer acquisition cost (CAC), from that how much can you spend on an introduction gift for 60 leads (20 leads per rep) per month. The rest is easy. The target demographic are mostly homogenous, CEOs and CFOs of companies that span many industries. Each rep is given a budget to spend on 20 leads and select some special gifts to send out to them. I’d guess the top reps would research their leads and find something very personal to buy their way to the demo.
Sales Growth Hack 2: Hack the client
One key advantage this company has is several years of sales and a very low churn rate. The best and easiest way to find new customers, is to request referrals. A better way to get referrals, and considering that the signatory on the renewal check is both the champion and someone with a keen eye on the budget, is to incentivize that referral.
I’d run my referral program in two different ways. The first way would be straight up incentivize the renewal. You are up for renewal, any email where you e-troduce me to a qualified lead gives you a free month of service. E-troduce me to twelve of your friends, get a year’s worth of service. The caveat here is to set a maximum. However if someone can offer forty leads with a 75% conversion rate, I’d let him ride and ask for more. Something to think about.
The second way would be to incentivize them on referrals and testimonials. This could come in the form of 6 months of free service for a few referrals and a testimonial. Have the testimonials come from leaders in the area, either in target geographically or target verticals, something that even without referrals the sales reps can use to gain an entrance to a company and book the demo.
Sales Growth Hack 3: Hack the company
The final acceleration growth hacking technique I would apply would be separate the sales reps responsibilities. If not completely then temporally. Based on the tenants of “Predictable Revenue” and the latest book from The Bridge Group, each part of the sales unit needs to function and be incentivized differently. Obviously for a small company with limited sales staff, doing so may be hard as initially gains will be slow with one rep is booking demos, one focused on closing, while the third is working existing clients for referrals.
The hack here is to take all the reps and have them all work on the same aspect of the sales cycle for a period, then they all move to the next stage.
For example, it is the start of the new fiscal quarter, everyone’s in on a call scrum working only on attempting to book sales demos. During this week the sales leader would run the most dials and most sales demos booked competition.
The next week everyone works the referral program, the next two weeks the whole team should all be out on the road running sales demos. When the new month starts, like groundhog day, everyone is back in the office for a week of booking demos call scrums.
This company is in a good place. They have a great product, they have existing clientele, they have cash to experiment with and they have trained sales reps. What the company needs do is start looking at their funnel metrics, understand their numbers and start testing processes that will adjust those numbers.
About the author
Following an academic career, Mark moved into business development and has been the critical early sales hire at start-ups that have grown to become global brands in scientific publishing and IT security. Currently, Mark leverages academic skills and sales experiences in the tech sector identifying market sweet spots and cultivating sales reps into power-players, closing bigger deals faster.