In many businesses there’s this general concept that the answer to their problems is in sales. Sales growth will improve or save their business performance by increasing its turnover. But simply increasing sales won’t necessarily be translated in 1 to 1 results. You need to be aware of the real reasons your business is lagging behind, basic aspects like:
- Is the budget too ambitious? Is the market declining? Are you losing market share? Did any disruptive technology join the market? Is the business cycle on its lower trend? Does competition brought any competitive advantage? Are there new players? Are there any circumstances affecting your segment like regulations or directives? Is your marketing and sales team fully engaged and connected? What’s your cost structure? Purchasing approach? Credit approach? Inventory levels adjusted to current market and portfolio?
And I’m not saying you shouldn’t push sales, but only focusing on that area and putting additional pressure on the sales team, might hide the real problem. An aggressive presence on the market could lead to reaction from competitors, negative impact on the mid/long term, could mean lowering price levels/returns, and could mean reputation damages.
Use all possibilities and alternatives to increase your performance. Reduce costs (all along the chain, not only production or product costs). Offer different products/services. Provide other solutions and features. Do you really need more customers or to sell more products? Optimize product portfolio, find new niche or growing markets.
Crucial facts. Put in place systems and processes to measure your sales with detail (region, product, and segment), market trends and competition moves. What is the market size, what drives the market, what drives the customers? Facts and numbers are crucial to help anyone define the way forward. Obviously if you’re in a disruptive product/industry, there is no data and you’ll need to move based on your vision and ambition, but do it step by step, always keeping one eye on how the market reacts. Disruptive technology can swing both sides very quick. Let alone and disappear very fast, or have a huge impact and take important share of established products. Speed of strategy and implementation are a must.
Take care of the existent customers. They’re paying your bills. Don’t let them leave. How do you do that? Ask them. Don’t assume. Ask them what they like, what they don’t like and what would they like to have. But hold that info; don’t jump straight doing what they want. Customers can drag you to the wrong side of the trends (if they’re too conventional and innovated adverse).
Customers you’ve lost. Approach them. Ask them why did they left. Did they found better alternative? Same service/Quality? Location? Be humble, honest and trustworthy.
Customers with low turnover: Check if this is result of your conscious choice or just “going” as is. Check full potential. Drop them if they don’t fit in your strategy and position in the market.
Customer Pipeline: Keep it alive and properly followed up and not a mere database to throw info and data, but a real source to be used frequently and moving positions along the cycle (yearly/semester etc.)
what differentiates you from the competition? What are your value propositions? What add services or features could your provide? What kind of relation do you have with your customers?
- A vendor with almost no affinity with your customers?
- A problem solver/Business resource?
- A strategic partner?
Your pricing approach:
- Don’t provide customers with services they don’t need nor are paying for.
- Be aware of customer’s specific needs. Specific struggles. Understand what’s going behind the scenes. What could improve their business (product performance, reduction of manpower, logistic improvement)? Come up with ideas targeting that specific issue. Not a general “problem solving” approach. Customers would pay a premium if they see the fit and benefit translated in lower end costs.
– Sales and Marketing/Innovation should go hand in hand, not in different layers of the organization. Regular communication and interaction to follow up market trends come up with solutions and support each other roles to achieve excellence. Marketing without customer feedback or participation is a dead end. Sales without marketing/innovation support and solutions will be a dead end.
As conclusion, “sell sell sell” can be a very appealing slogan, but push sales teams to frustration if they don’t feel there’s a complete alignment of the organization, the vision and strategy (not on the short run) particularly on the middle/long term.