What You Should Know About Your Sales Funnel
If you’re experiencing a dip in revenue, take a closer look at your sales funnel. Something might be blocking it.
So your sales team isn’t meeting their numbers.
It is rare to find a company that isn’t desperately seeking more sales. What isn’t rare? A company relying solely on the sales team to drive the entire sales cycle, from bringing in the leads to closing the contract. And when overall sales are stagnant or declining, the first reaction in the C-Suite is usually to apply more pressure on the sales team or to assume they’re underperforming.
But figuring out why sales have slowed down can be complex, challenging, and time-consuming. As in medicine, you can’t actually treat the disease until you’ve correctly diagnosed it, and in sales, as in medicine, getting to the heart of a sales malady is part science and part art.
Start at the Top
When we receive a call from a small or medium business owner looking to bring in an interim VP or Director of Sales, one of the first questions we ask is, “Where does the organization’s lead pipeline originate? How do you generate leads?” In the majority of these cases, the sales team itself is responsible for generating all of the leads as well as converting them into revenue-generating business, and also following up with customers on an ongoing basis, either to maintain them as a customer or to help expand the solutions they are buying from the company. (It’s a lot.)
The next set of questions are focused on the sales’ team’s organizational support: marketing materials and efforts to help generate those critical leads. It is usually at this point that business owners stop the conversation and remind us that they have a “sales problem,” not a “marketing problem.” But we persist. And by the end of these conversations, we’ve generally helped the owner understand the sales team actually does a pretty good job of converting leads into business—when there are enough leads to convert.
Bottom line: When clients call and share that their sales have plateaued or are down for the year, a “bad sales team” is not typically the root cause of the issue. Sales are usually down because the organization depends on their sales team for two functions, not one: It is counting on salespeople to bring in all of the leads for the company as well as closing them.
Well, that approach may have worked in years past, but in today’s competitive environment, multitasking is not going to help achieve growth goals. An organization facing such a challenge absolutely needs good strategic and tactical marketing to supplement the sales funnel.
Marketing and Sales: Two Roles, Two Functions
It is not uncommon for a growing company’s entire marketing plan to be a website, an e-newsletter, and a sales team.
As eye-roll-inducing as the terms “marketing strategy” or “marketing plan” are to most business owners, those two factors can make the critical difference between wasted resources and results.
Marketing isn’t just constrained to the “marketing department.” Marketing is every interaction, activity, touch-point, and impression someone forms about the company. Each of those activities has a dollar amount associated with it. Good marketing can add up to thousands or millions very quickly; so can bad marketing.
A marketing strategy and plan to consistently generate qualified leads for salespeople to close is every business owner’s dream. It confirms which activities will lead to the targeted results, in what timeline, along with costs and projected ROI. And once the strategy and plan are set, they can then be carefully monitored and tracked in coordination with sales efforts.
Sales funnel ROI
“But what’s my return on investment for marketing?”
I can almost hear the business owners shouting, “I knew it!” as they read, and that’s because they have likely been told, over and over again, “we can’t track that.”
If money is being spent, ROI can be measured, and while Customer Relationship Management (CRM) software is the state-of-the-art, it isn’t the only way to calculate ROI. It’s just the simplest.
Track every touch. Track mail. Track advertising. Track emails. Track calls—inbound and outbound. Track form submissions and queries from the website. Track which web pages are drawing the most eyeballs. Track everything.
Find out where leads are coming from—do more of that.
Find out which activities are not producing leads—do less of that.
It may sound simple (and it is) but it isn’t easy.
When you’re frustrated with your sales results, and you think it’s a pipeline issue, take a look at your marketing activities to see how effective they are at bringing in leads. If they aren’t working, bring in an interim marketing expert who can quickly put on his (or her) diagnostician hat, take a good look under the surface, and find out the best way to put your marketing dollars to work to fill up the sales funnel.
Please contact us to learn more about how to put together a sales funnel. Just remember, what gets measured gets managed, what gets managed improves.