Increase Revenue in a B2B Company – Video

Increasing revenue. It’s a big deal to everybody. So let’s go ahead and talk a little bit about it, especially with regards to fixing problems in a B2B revenue stream. I’m Steve Doyscher of B2B Growth Coach, and it helps to understand this from the biggest picture possible. So let’s start off at the beginning. 

A company is created and you start off with a logo and a website, and you go on to hire a crackerjack sales team right here. And they go forth and they make rain and everything is great, but eventually sales plateau and even start to decline. And so you’re starting to look a little bit more like this, and you’re wondering, well, how in the heck did we go from this to this? The answer lies in Porter’s Five Forces and so we’re going to talk a little bit about that right now.

Porter’s Five Forces was created in the late ’70s and published by the Harvard Business Review, and everything back then still holds true today. There’s five different things that are working against you, day in and day out. So the first one is rivalry. And this is just your competition. The competitors that you work against daily. 

You also have the bargaining power of suppliers. So the more leverage that these suppliers have with regards to your the inputs that you need from them, the more concessions that they can demand, including higher prices. 

Similarly, you’ve got the bargaining power of customers. So the more choices that your customers have, the more leverage they have over you as well. 

You’ve also got threat of new entrants. And these are new competitors that come in and work against you. And they can be direct where they offer the same benefits, goods and services that you have. Or they can deliver substitutes. Things that can take the place of what you currently offer. 

So of these five forces, I want to focus in on one of them right now. And that is the bargaining power of customers. So things have changed a lot in the past decade, to 15 years with regards to information.

There’s something called information symmetry. Where people all have the same access to information. 15 years ago, your sales team had a lot of information asymmetry, which meant they had a lot more information than your customers did. Nowadays, it’s easy to hop online and do a lot of research on your own to determine what you need and and start the buying process from there.

And I’m going to show you a couple of stats from Forrester that will kind of flesh this out. So 92% of B2B customers start their search online.  Which makes sense because any time in your personal life, if you’ve got something, if you have a need and you’re not sure where to go, chances are you’ll hop online to start your search. So this makes sense. 60% of people do not want to use your sales team as their primary source of info.

So people hop online, they look at different information. One of the big things that they may be looking for is reviews. You know how do other people – What of their experience has been. So there’s a lot of information out there.

Additionally, 62% of people can better understand the criteria for what would fill their needs or finalize a vendor list. So they can take a look. The criteria part is of course – they can take a look at a lot of different, websites. So for example, if I was going to purchase a new server for my company, I would take a look probably, for 15, 20 minutes and I could find out several different vendors that have servers that could find out what the features are that separate them and understand the benefits and start to educate myself on on what I need. So it helps with the criteria. 

Finalizing a vendor list. That means that your marketing materials are front and center for nearly two thirds of opportunities out there. And if your marketing materials aren’t up to snuff, if they’re not doing what they should, you are going to be, only open to one third of the potential opportunities out there.

So with all of this information, you would think that, okay, companies really know that they need marketing and they need it in a, in a substantial way. But all too often this is actually the stance that companies have. You know, they don’t like marketing because of a couple of different reasons. And so one of the reasons is that you’re a sales centric organization. You’ve grown up just like we talked before. You start a business, you grow through sales, and that’s what you’re comfortable with and that’s what you go with. 

And number two, there’s a big draw. There’s a lure of quick increased revenue by hiring an additional sales person.

So, the additional sales person is going to give you a boost in your sales. But I want to look at something actually a sales tool to think about this a little more deeply. I am going to use something that’s known as a sales velocity. Formula.

Sales velocity formula. And this has four components to it. The first one is going to be the number of opportunities. The number of opportunities that you have available times the dollar value on average of the opportunities. And we’ll multiply that by your win rate. How often you win on average.

This is going to equal value that you can expect. And then this is going this is a formula that has a denominator in it. And that is going to be the length of your sales cycle.

And that equals time. So value over time. Now let’s take a look at these four components. And when you think about adding a salesperson and what is that person going to bring to these four components. So first will the salesperson help you with the number of opportunities. And the answer to that is yes. The salesperson is going to be able to have more calls, schedule more schedule and and deliver more demos.

Whatever it is that your sales team does, this person is going to help with. But is this person going to help across the board increase the dollar value of your opportunities? The answer to that is no. This one person is not going to help the rest of your sales team increase the value of the opportunities that they’re selling.

Also, the win rate is the salesperson going to help you with the win rate? So are you going to be winning more because of this person? Maybe individually this person might be a high performer, but this person is isn’t going to affect the rest of the sales team and help them to win more. Similarly, this person is not going to be able to help shorten the length of the sales cycle for your entire team.

Now, marketing actually can help with all of these, and I’ll show you how right now. So when we think about the number of opportunities that you’ve got – marketing helps with awareness. So if you need to have more people come to your website, if you need to have more people come to an event, if you need to have people pick up the phone and call, that’s what marketing does.

What about the dollar value of the opportunities? This is where brand and positioning come in. Marketing can and should be able to crystallize the value that you have, both for your company and the things that you offer. So they will be increasing the perception of value for what you deliver. So, this will in turn allow you to increase the dollar value of your opportunities, which will help also with your win rate and the length of your sales cycle too.

But let’s talk about those directly. Your win rate and your sales cycle are both helped by messaging. And what I mean by that is you have multiple people in the buying circle in a B2B business, right? So it’s not just one person. It may be a team of people looking at what you have to offer. You’ve got the gatekeeper. You’ve got the ultimate decision maker who decides whether or not they’re going to purchase, you’ve got the end user, you have purchasing, which may have a role to play in this. 

Being able to develop messaging that not only displays the value of what you’re what you have and crystallizes it, but it actually preemptively goes after the needs and explains and delivers information against common objections for each of these different stakeholders in the decision is crucial in being able to increase your win rate, because you’re going to be knocking out the competition and also reducing the length of the sales cycle, because it’s not going to take as long to vet you because you’re already answering the questions that they need answered.

So knowing that you need marketing, knowing that how it can help you, you know why you’re having problems, how it can help you. One problem, an issue that companies have a lot is okay, “How do I how do I go forward with marketing? How do I do this?” And what I want to show you I want to illustrate it like this.

You are a team that is in the wilderness, and your team is trying to get out of the wilderness to the safety of increased revenue. So what you do is you look for a guide, and this guide is going to help get you to where you want to go. The problem is, you have to be really careful with the guide that you select, because there are literally dozens of types of marketing.

There’s traditional marketing, and traditional marketing might be direct marketing where you want to. They’ll say, we need to be able to create printed pieces. We need postcards and brochures, and we’ll purchase lists and send your information to these people. Whereas a mass marketing company is going to say, well, we’ve got TV and radio and billboards and outdoor and that’s the way to go.

You’ve got inbound marketing, which says, well, no what we need to do is develop content that will get people to take interest. Give them give you their contact information, and then you’ll have automated marketing and landing pages and things. You need social media marketing. That’s the way that we’re going to be able to get more revenue. All of these different things are different tactics, different ways to get in front of people and to market to them.

But the problem with this right here is that when you’re a hammer, every problem becomes a nail, which of course isn’t the case. What you need is a holistic approach to systematically, deliver on goals that you have for your company. And I’ll explain it this way. Right now, if you were to, let’s say, contact an SEO company and this firm says, yep, we agree that if we get more people to your website, that’s going to increase revenue.

So it’s like squeezing a tube of toothpaste at the front. So you go ahead and squeeze here and you might get some value out, but some of the effort might actually go to waste, which would be, you know, represented by something going back, the toothpaste going back into the tube. So for our SEO example, or search engine optimization, you might get more traffic to your website.

But is the website broken? So for example, the user experience, do people actually have difficulty navigating the site? Do they know how to get through it? Or even if the UX is correct? Do people understand specifically who you are, what you have to offer, and why they should care? So if your branding, positioning, and messaging are off, all the traffic in the world isn’t going to help your revenue.

Now contrast that. With this, which is true strategic marketing. Here, what you’re doing is this tool represents using strategy and making sure that what you do at every turn is done with intention. And there are a lot of things that compose this. But in a nutshell, you are getting the most value out of each step that you take, because it is done strategically and in a much bigger context than just throwing a bunch of random darts at a board.

So, marketing and sales should be thought of as two peddles on the same bicycle, driving revenue. Marketing creates the environment for your sales team to win.