Optimizing the Revenue Engine

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Understanding how to successfully connect your marketing efforts to what gets closed as new business is not a small task. From digital campaigns, optimizing SEO for web traffic, events, data enrichment within the CRM, routing leads to the proper destination, Marketing Qualified leads (MQL's), etc. Marketing teams have their hands full. At the tip top of funnel, they measure the actions taken by prospective MQL's and decide, based on a plethora of factors specific to each company, when to surface a person to the business development or sales team for them to reach out. How a strong marketing team operates and iterates their processes is usually based on conversion rates.

Recently, I was featured with Ben Budde (VP, Sales @ Groove), Diana Maros (Account Executive @ Groove), Kristin Hersant (VP, Marketing @ Groove) for a group breakout session/lunch during the Modern Sales Pros rendition of "Optimizing the Revenue Engine." Here's a bit more about what I had to say.

Why Conversion Rates Matter

Marketing teams measure and achieve their goals of building brand awareness and getting more and more people into the sales funnel that are a company's specific "ideal customer profile" through looking at conversion rates, and mapping spend to those numbers with their campaign channels. Good marketing teams create models that portray the intended outcomes of marketing spend and what results that spend will lead to.

For simple numbers, if we reach 1,000 people for an event, and 100 are willing to meet with a sales person, the conversion rate of those who 'converted' from attendee to conversation would be 10%. If 25 people of those 100 that met with a sales person converted to being an opportunity, then 25% of meetings from that event become opportunities. If 10 of those 25 newly created opportunities become new customers, then 40% of opportunities from that event became customers. In summary, 10 out of those 1,000 people that attended became customers. That overall conversion rate from attendee to client = 0.1% (10/1000). So how to tell if that event was worth it? And how many of those need to happen in a year for enough pipeline? If that event costed $10,000, and the average selling price (ASP) of these 10 deals that close was $30k, then the company spent $10,000 + all the costs of a sales team to get those opportunities closed = to create $300k in bookings revenue.

So from attendee to conversation to opportunity to new client, they track success based on conversion rates. Understanding this can help sales teams understand more about how to create strong sales and marketing alignment. But further, why not look at the sales process with the same mindset? With the right product - like Extrovert's Metrics OneView, you don't have to be a data expert to understand how well your prospecting process is performing. And you don't need a BI team to build you the dashboard that connects all your revenue leaders together around the metrics that matter.

Why Conversion Rates Can Matter in Sales

Just as there are metrics that illustrate ROI and help track progress for marketing teams, the SDR and Sales functions have clear pathways to track the success of the revenue engine at the top of funnel pipeline. In a typical ~20 day work month or ~65 day work quarter, the use of a Sales Engagement Platform (like Outreach, SalesLoft, Xant, Groove, MixMax etc.) helps increase the number of touches that happen across target accounts to prospects and personas that they want to speak with. Once they get a hold of those people they are reaching out to, the number of people that they can get to agree to meet with AE's depends largely on the number of people that they are reaching out to and the message they are sharing, along with conversation approach they are taking.

There are conversion rates between each metric:

  • # of people being prospected >

  • dials/emails/social touches made (prospecting interactions) >

  • phone connects with clients >

  • discovery calls/high impact qualification >

  • opportunities created (see below).

The space between each metric is also the place that we could call the "friction point" or "gap" standing between progress. A revenue team creating an effective pipeline creation strategy knows achieving the right conversion rates to maximize profitability is contingent upon succeeding, and being able to track it. As a person uses their Sales Engagement Platform, if they and their manager understand how many dials usually are required to get to the proper number of opportunities, then you can "math" your way to quota.

Why Conversion Rates Are Hard

Obstacles stand in the way of SDR and Sales leadership improving conversion rates that are not based solely on the number of activities someone performs. If a rep is struggling to get someone to engage with the value proposition they share at the very beginning of the call, making more dials before fixing the value proposition problem would mean they are wasting conversations with people that still don't care to listen to them. If a rep has a ton of great conversations but doesn't handle objections well at the end of calls to seal the deal for a scheduled demo, then that's gonna mean a different set problems that require other types of coaching. If you get a lot of appointments scheduled, but the hold % is abysmal, you won't have discovery calls convert to opportunities as often. On top of that, your ops team has to really nail the integration between your Sales Engagement Platform and CRM, or else you will look at metrics and try to craft conversion rates -- and your data could be off (a lot of times it is.)

Above all, this focus on conversion rates cannot be a one time team meeting thing, it has to be built into your sales process, it has to be shown to be in the rep's best interest for them to care about this, because it is (or else you are monitoring and controlling people instead of partnering with them toward mutual success). You have to gear the process toward a market strategy that gets the right people into funnel.

To sum that up, a few important points include:

  • Enablement to improve the soft skills at each friction point

  • Having accurate data in the CRM from prospecting efforts

  • Consistency in executing a strategy catered to your ideal customer

Simplifying the Prospecting Sales Funnel

If you want to be consistent, you also must simplify. The easiest way to get a higher quantity of high quality opportunities into the sales funnel, and accomplish that with less effort and therefore less cost, is to simplify.

Simplify your plan. Simplify your technology. Simplify your process. Simplify doesn't mean innovating new ways to do crazy cool things that require tons of complex configurations, or getting creative with how to enter a new market like no one else has––the fast still always eat the slow in our day and age. But simplify how easy it is for your users to get prospects across those friction points. If you can increase their soft skills, automate their lives, and let them focus on the conversation itself, the roadblocks to higher quantities of high quality pipeline start to be intrinsic/motivation centered. And good leaders can figure that out.

Sounds like a utopia right? More opps (higher volume) of high quality (better qualified ideal customers), with less effort (lower cost). Can it be done? We know it can at Extrovert, but it starts with you taking the right steps to make your reps lives easier.

What goes into prospecting really? Forget whatever your favorite sales methodology is for a sec - this is agnostic to any of that. [1] RESEARCH YOUR POTENTIAL ACCOUNTS, [2] PROSPECT YOUR POTENTIAL CLIENTS IN THOSE ACCOUNTS, and [3] QUALIFY THOSE YOU TALK WITH AS WELL AS YOU CAN. Once they are in pipe, then you can close them and create clients/grow the accounts where you have revenue already.

Cross-Functional Collaboration

We call it "Rev Ops" or "Revenue Operations" - what is it? Break it down. Simple. It's people who've been hired to make sure revenue increases. Why is it so hard? Because there are a lot of things that go into that. Why can't we just align? Because we come from different backgrounds, and we come from various levels of understanding, skill, training, etc. The danger we have is that sometimes revenue leaders or operational people wished that there were people that just agreed with them, or made things less complicated, or whatever. They forget that the strongest thing you can have in a group of people constructively working together toward a common goal is difference of opinion.

We have to have a difference in opinion or else we create an echo chamber. These echo chambers can be hard to escape, because most often, you don't know you are in one until you got out. But we can change this from the start. We can, as revenue leaders decide to work together. Find the common metrics that matter, and live by them. And disagree with each other - A LOT! Make it okay. Make it required. If you do, and you don't go around always trying to convince everyone you are right, you win!

The easiest way to do this is definitely with the metrics. Use those metrics. Align on how to cut the data. Get the right people working on the data. And then use that data to make decisions.

Simplifying funnel metrics and making progress in a company as a team won't happen if egos won't let go of their agenda. Project plans made together win. And remember, "people buy into that which they create." _______________________________________

If you want to start simplifying, automate things, and even segment your efforts by persona more for that extra "umph" of specificity, Extrovert can help. We help you get a higher quantity of high quality pipeline opportunities, and we hope to provide your business with what you need to simplify, and reduce the friction between each metric so that you can send your reps home happy, decrease your turnover rate, increase your conversion rates, and produce the highest possible ROI on your sales team from your top of funnel prospecting efforts.

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