by Bill Poole | Mar 14, 2022 | Sales, Strategy
Recently I talked with a business owner who had put all of their lead development into one particular source. Leads were streaming in—until the platform changed their rules. When that happened, new business came to a grinding halt. It took many months to ramp up a new strategy and the business suffered.
A strategy of leaning heavily into one source of leads is like buying stock in one company and putting all of your assets into that stock. No smart investor would do this. Yet, when it comes to leads for net-new business, this is exactly what many business leaders do.
Smart investors diversify their holdings, owning a mix of various types of assets. If circumstances cause the asset type to underperform the hope is that the others will pick up the slack.
Smart business leaders diversify their sources of net-new business. This ensures that if one lead source stops performing, others can pick up the slack.
At Convergo, we refer to sources of leads as Lead Channels. Think of multiple streams feeding into a river. If one stream dries up, the river still is fed from other streams.
The Lead Channel analogy is similar to the distribution model of many technology companies. A computer manufacturer typically has multiple channels including their direct sales team, channel partners, and retail. Inside each of these channels they have multiple types of channel partners and retailers. This diversification helps ensure consistent revenue.
What Are Lead Channels?
Lead channels are the sources of net-new opportunities for your business. Here are a few common lead channels to get you thinking:
Inbound Marketing
- Digital Advertising
- Organic Search Engine Placement
- Social Media
- Traditional Advertising
- Public Relations
- Events
- Podcasts
Direct Marketing
Outbound Selling
- Prospecting Sequences with Email, Phone, and Social
- Social Networking
- Lead Sharing Groups
Smart companies have a mix of lead channels.
If one of these works well, great! However, it is unwise to put all of your eggs in one basket, as they say. Smart companies diversify their Lead Channels.
What Keeps Companies From Diversifying?
Why do companies get stuck in the trap of one Lead Channel? Here are the two most common reasons I see.
The High-Performer
We have a tendency to double-down on high performing Lead Channels. If there is a particular strategy that works well for you, great! Just like you might want to put more of your investment portfolio into a high-performing stock class, it is smart to put more focus on a high-performing Lead Channel. The important thing is to not put all of your focus in this area. Sure, it is performing well right now, but that may not continue forever. Beware of the shiny object that takes your eyes of a diversified lead generation strategy!
Short-Term Thinking
Some Lead Channels take longer to develop than others. For example, a pay-per-click digital ad strategy might yield faster results than building organic placement in search engines or executing a social media strategy. Short-term thinking says, let’s go all-in on paid ads and forget about the long play. This mindset could keep you from enjoying the long-term fruit of an effective search engine and social strategy.
The Way We’ve Always Done It Around Here
For my friends in sales, “the way we’ve always done it” is a common reason to not diversify lead channels. I began my sales career 30 years ago in an industry that was all-in on face-to-face cold calling. We literally went door-to-door grabbing doorknobs, asking for decision makers, and collecting phone numbers to fuel phone prospecting later in the day. While this strategy worked well back in the day, over the past three decades many other potential lead channels have emerged with the maturity of the internet and mobile. Yet many companies in this industry still focus exclusively on field cold calls, refusing to diversify their Lead Channels.
Other industries have traditionally used billboards or TV advertising. Fantastic. However, billboards now exist in the form of digital advertising. TV advertising doesn’t just happen on NBC, ABC, CBS, and FOX. It also happens in a highly-targeted way on YouTube.
What You Can Do To Diversify
Whether you are enamored with a high-performer, trapped in short term thinking, or stuck in the way you’ve always done things, here are some steps you can take to diversify your Lead Channels.
Be Open-Minded
First, be open to new ideas. Experiment with new Lead Sources. Keep doing what’s working, but allocate some budget and attention to new things. A trustworthy sign that you might not be open-minded are the words, “Our prospects and clients would never…” Are you sure? We heard this a lot years ago about social media. Yet even my retired mom regularly visits Facebook and runs and Etsy store that gets leads through Google. Be open-minded.
Be Strategic
As you are being open-minded, don’t just jump on the next trend. Consider your Ideal Clients. Where do they spend their time? What outcomes are they looking for? What would be the best forum to engage in discussions? Use this to guide your diversification strategy.
For example, if your Ideal Client is a plant manager at a manufacturer, continue your sales prospecting efforts but consider how you might engage in additional strategies such as creating a podcast for plant managers, creating a group of similar companies that sell to plant managers, or doing digital marketing to a target audience of plant managers.
Strategy also means making some decisions that may not always look good on paper. For example, you might decide the get engaged as a sponsor for a conference or industry trade show. The cost-per-lead may be high, but the strategic benefits of exposure as a leader in your industry might need to be factored into that cost as well.
Be Smart
Track your Lead Channels. Where are new leads coming from? Which channels are performing well? For the ones that are underperforming, is there a long-term plan in play? If so, keep investing. If not, reallocate your dollars. For each Lead Channel, look at the revenue that came from that channel and determine the revenue that resulted and the cost-per-lead.
Diversifying your lead channels takes work. In today’s rapidly changing marketplace, this work will pay off. While your competitors are left scrambling and trying to pivot, you’ll keep moving forward.
by Bill Poole | Mar 8, 2022 | Marketing, Strategy
Originally posted by Forbes
Growth Architect and author of Revenue Growth Engine, helping companies align sales and marketing to grow revenue faster.
When times get tough, it can be tempting to look for revenue anywhere you can find it. As one of my first sales managers used to say, “If they can fog a mirror and sign an order, we’ll take it.”
The reality is that not all revenue is created equal. And, as I say in my own business, “Not all clients are created equally.” There are some clients who provide more value than others. In this current environment, it is more important than ever to focus on “ideal clients.”
What is an ideal client? These are clients who need everything you sell. They have value because they are candidates for all of your products and/or services. They have to fit because they align with your culture. Ideal clients are especially important when:
You have limited marketing and sales resources.
Unless you are a major company, chances are you have limited sales and marketing resources. If you try to market and sell to everyone, you will end up reaching no one. Understanding your ideal client profile allows you to focus your business development efforts on a specific group of prospects. You might tell your sales team, “You can sell to anyone, but 100% of the time you will call on these ideal prospects.”
With ideal clients, business development also takes on an additional dimension. Since these clients need everything you offer, the marketing and selling don’t stop when the first order comes in. In fact, selling and marketing begin with the first order. Focusing your business on ideal clients allows you to direct marketing and sales resources to harvest the additional revenue opportunities in these accounts.
You have limited operational resources.
The combination of the current supply chain crisis and the tight labor market clearly demonstrate that even the best companies have limited operational resources. In this environment where we are acutely aware of limitations, it makes sense to focus resources on serving the type of clients who have the most revenue potential.
The old adage, “The squeaky wheel gets the grease,” tends to be true in daily operations. The reality is that many of the squeaky wheels tend to be nonideal clients. As a result, many times it’s your nonideal clients who end up getting most of your team’s effort. At the same time, morale suffers. Resources get diverted away from ideal clients and you miss the opportunity to maximize revenue and retention of ideal clients.
In the book At Your Best, author Carey Nieuwhof explained how leaders can fall into the trap of spending their best time on fire drills and challenging employees rather than proactively investing in their top leaders. But we need to intentionally schedule time with our top leaders because this is what will drive the organization forward.
Similarly, it can be easy to let the team’s resources get diverted toward challenging clients who are not ideal for your business, thus causing you to neglect ideal clients. But your ideal clients are ideal because they are likely easy to work with. That means you need to intentionally invest time and resources in them, even if they are not being the squeaky wheel.
You have limited financial resources.
Revenue is the lifeblood of business. I conduct revenue growth workshops with businesses across multiple industries, and I have consistently seen that ideal clients have significantly more revenue potential. Plus, ideal clients will be those customers who are more loyal, value what you do for them and see you as less of a vendor and more of a partner. That means they have a much greater chance of sticking around. If you need more revenue, I believe ideal clients provide the most sustainable path. Since they value what you do, they tend to pose fewer problems.
Focus on ideal clients.
Now, more than ever, smart businesses focus on ideal clients. This begins by understanding your ideal client profile. Next, identify the current and prospective clients who fit the profile. This allows you to focus your sales, marketing and operations efforts around attracting ideal clients and cross-selling all of your products and services to them to maximize revenue potential.
by Bill Poole | Jan 31, 2022 | Sales, Strategy
When faced with a price increase, clients may feel backed into a corner with only two options. One option is to take the price increase, sacrificing somewhere else in their budget. The other option is to stop buying from you and either forego the service or go through the hassle of finding another vendor.
Price increases typically create a “yes” or “no” scenario. Instead, what if you offered a third fallback option that was a scaled back version of your service?
Your fallback option could be lower-cost package with fewer benefits for your clients that are not willing to accept the price increase. You win because you keep the client. The client wins because they get to save money while keeping pieces of your offering.
The good news is that your fallback option not only can preserve revenue, it may also be able to preserve your profits. Done correctly, it may also create a strategy to go after your competition and get marketshare.
Here are a few things to consider as you create your fallback option.
Ask What Is Essential To Your Customers
When I was a kid most of the cars we had growing up had an AM radio, bench seats, and windows that you rolled down by hand. Now my car has an incredible surround-sound stereo system, multi-position heated buckets seats, and automatic windows. As much as I like these amenities, the reality is that I mainly need my car to get me to the airport and back. If cost-cutting were necessary, I could live without the fancy things.
Think about your products and services through the eyes of your customers—especially the ones who tend to be price-sensitive. What is most important to them? What can they not live without? What challenges are they facing that your offering alleviates?
Bob Moesta and Clay Christensen believe that buyers don’t buy products and services. Instead, they hire them for a “job to be done.” In the case of my car, I mainly hired it to get from point A to point B. Sure, I also hired it to provide some comfort, enjoyment, and status. But if times are tight what I mainly need is transportation.
Think about your offerings. What “job to be done” did your customers have that motivated them to purchase from you? What is essential and what is optional?
Your fallback option should include the essentials. In fact, you might even call it your “essentials” package. Strip away the surround sound, heated seats, and automatic windows. Offer a lower-cost option that still gets the job done. This allows you to keep your client while becoming a partner that also helps them achieve the goal of reducing their costs instead of raising them.
Consider You How You Can Preserve Your Profits
Just because you offer a fallback option with a lower cost does not necessarily mean that you need to lower your profits. Look for ways to package your “essentials” option in a way that has the same profit as your full offering.
Once you create your “essentials” bundle look at the cost of the product and/or service.
Then, take the actual dollar amount of the margin you had on your full offering and add it to the essentials offering. If you use this as the price you can protect your profit.
Can you always protect your profits? No. However, sometimes you might find a way to even raise your profits.
Create a Campaign To Add Back Margins
For the customers that choose your fallback option instead of a price increase, build a marketing campaign that allows them to add back some of the options. You might let some time pass. Then start dripping out marketing that lets them add in features. Make it easy to bring these back in.
For example, my TV provider recently raised their rates. If they had a fallback option, I might have opted for fewer channels to save some money. Over time, the provider would be smart to begin offering some of the channels I lost for an incremental increase in monthly fees.
You might be able to do the same. After some time has passed, launch a marketing campaign that invites clients to incrementally upgrade their experience with your company.
Go After Your Competition
As you create your fallback option you may discover a new offering that could attract customers from your competitors. Chances are your competitors are raising prices. Your “essentials” offering could be the thing that lures them away. Once you bring them on board you can expand the relationship.
by Bill Poole | Jan 31, 2022 | Strategy
Increasing costs require many businesses to raise prices. Rather than just raise prices, what if you could take a strategic approach to cost increases? Following are ideas to get you thinking creatively about how you could handle this challenging situation.
First, consider if you are a core supplier or a vendor.
You are a core supplier if you are a key partner to your customers. You show up on their profit and loss statement as a cost of goods sold. Your offering is key to their success. An example might be a materials supplier to a manufacturer. You are critical to their business operations but you might also sell a commodity that is easy to replace.
You are a vendor if you provide something that is not a core part of the business. For example, you provide office equipment or bookkeeping service. You show up on their profit and loss statement as an overhead expense. In some cases, your offering may be optional or easily replaced. It’s not that your services are not important to your customers. It’s just that they think about you as an expense rather than a cost.
Core suppliers and second-tier vendors may need to approach the price increase conversation differently. Here are some ideas.
Core Suppliers
Here are some strategies that can work for high-relationship businesses where you are a core supplier to your customers.
1. Make It a Business Conversation
Rather than just send out an email or letter, use this as an opportunity to have a business conversation with your customers. Be empathetic. Ask about their business challenges. Be open about how the current business environment has affected your operations. Discuss how you made the decision increase costs to maintain quality rather than sacrifice quality. Explain how you have done this by increasing wages, taking measures to alleviate supply chain issues. You could also share some long-term vision about how you are working to create operational efficiencies that will
2. Discuss Concessions in Exchange For Commitments
When key clients push back on price increases, use this as an opportunity to offer price concessions in exchange for commitment. For example, you might agree to continue previous pricing levels (or a level in between current pricing and the price increase) in exchange for a volume commitment over the next year. Be prepared for this by creating pricing tiers based on volume commitments.
3. Bundle Profitable Services
Similar to the commitment idea above, you could offer a bundle that includes profitable services. If you sell both products and services, consider ways to offer the same product price if the customer bundles in high-margin services. If you don’t have a high-margin service to go with your products, you might consider services you could add. This could open up new lines of profitable revenue.
4. Add Temporary Fees Instead of Raising Prices
Rather than raise prices you can add or raise fees for your products. These could include shipping and/or handling, configuration, or installation. If you think your cost increases will be temporary, consider adding a temporary fee on orders.
Vendors
If you show up as an expense on your customer’s profit and loss statement here are some strategies you can use if you are an overhead expense to your clients.
1. Outsourcing Strategies
One way companies reduce overhead expenses is by outsourcing non-core functions. While your pricing for your products may go up, there may be a way that you can take over the entire function for a client. One recent example is QuickBooks. In addition to providing software, they now provide bookkeeping services. Their customers now have the option to outsource all of their book keeping to one vendor.
2. Vendor Consolidation
Could you provide more products and services to your customer? Another expense reduction strategy is vendor consolidation. From the customer’s perspective, fewer vendors to manage. You might consider offsetting the price increase for customers that are willing to bring more lines of business to you.
3. Rethink Your Offers
The hybrid work environment seems to be here to stay in many industries. Consider how you could re-package your offer to support the mix of people working at the office and working from home. If you sell to businesses, listen to the needs of your current customers. If you sell to individuals, their needs have likely changed as well. This is a perfect opportunity to realign your products and services around their needs. In the process, you can reconfigure pricing to account for cost increases.
4. Resize Your Options
This is a playbook from the food industry. To offset rising prices, some food providers are keeping their price the same but reducing the amount of product. Could you do the same thing without affecting your customer? Maybe there is a way to repackage what you do so that you lower your costs but increase value.
Whether you are a core supplier or a second-tier vendor, there are many creative ways you can approach price increases. In the process you might even discover ways to reinvent your offerings that make you more valuable to your customers while increasing your profits.
by Bill Poole | Nov 29, 2021 | Strategy
You might be wondering when it’s the right time to expand your marketing team. With a refined sales and marketing process, it can be pretty transparent on what you should be hiring for. Being particular about which role to fulfill isn’t necessarily a bad thing. Taking those initial steps to figure out what exactly is lacking in your marketing organization can help ensure you are hiring for the right role that will help you to achieve your overall business goals. Without this clarification, you run the risk of coming up with great strategies without the ability to execute or having an excellent team ready to work, but with no strategy in mind.
Start by breaking it down. There are four potential perspectives that your marketing team may need to zero in on:
- Strategic perspective
- Management experience
- Content creation
- Execution
Strategy
When that strategy is implemented, it’s all hands on deck; one aspect can’t work without the other. Now is the time to be truly honest with yourself. What does “good work” look like to you? What can or should we be doing to achieve business goals? A big part of what type of marketing person you choose to come on board will be dependent on if you have a strategy in place. It’s also important to consider where your team may need rounding out to actually execute on the strategy effectively.
Management
We have a strategic process in place, great! Now, who will be on top of it? Managing a marketing strategy is a consistent role. Being on top of the plan and knowing where it’s going allows for your other team members to work more efficiently. Think about what the end game is. Once you have that strategy and team implemented, it is key to appoint someone to manage that strategy and team. It’s crucial to have someone that is constantly making sure deadlines are being met, details are added and processes are being completed.
Content Creation
Working on great content comes as a team effort. Brainstorming and going back and forth within the team is one of the best ways to explore new ideas. Getting excited about new projects is one of the fun parts when it comes to the marketing process. Content creation ideally should be done in-house, but subject matter experts may not have the time or skills to write or produce content regularly. If that’s the case, then outsourcing content creation is an option as it can allow for faster turn around and other perspectives. However, when going the outsourcing route, it’s important to remember that it can come with a hefty price tag.
Execution
Depending on what the strategy calls for your business, you will need specific skills to help achieve your goals. Outsourcing can be a great option for this depending on what your marketing strategy is. You may need graphic design help, web developers, SEO professionals or general marketing coordinators for the day to day.
In this world, nothing is for certain. Making sure your business is staffed with talented and hard working people can only lead to great things. Growing your marketing team invites new ideas to push along your company’s ambitions, but you want to make sure you are making the right hire for the needs of your company.
by Bill Poole | Oct 11, 2021 | Strategy
Every business shares similar struggles: there aren’t enough hours in the day, a limited marketing budget, maybe only a few sales team members. It’s important to filter through clients and projects to ensure that goals are being met as efficiently as possible. Therefore, it’s important that your sales and marketing teams gets focused on making sure you are bringing in your ideal clients.
In today’s discussion, we’re talking about using filtering criteria to ensure all of the focus is on our ideal client.
There are two ways to think about filtering your clients as they move through your funnel: Proactively and Reactively.
Proactive
When we talk about proactiveness, we want to look at which companies that we should target. If you know your ideal clients, it makes it easier to focus your sales energy on them. One way to focus is to compile a list of local businesses. You should do some preliminary research to which companies you should be reaching out to — the types of clients that are more likely to engage in your services and foster a healthy working relationship.
When thinking “proactively”, you might want to ask yourself these questions:
- Who or what companies should we be proactively reaching out to?
- How can we focus down and work efficiently off of our prospect list?
- Are our marketing processes designed to target ideal clients?
Reactive
When we talk about being reactive, it’s more than just someone picking up the phone or clicking a link. Although this interaction is the ultimate goal, it’s more about quality than quantity. We want to make sure that the people who are calling or visiting the website are a viable option to continue with sales’ and marketing’s, and ultimately operations’ efforts. Having forms to filter out the less compatible prospects can help us regain focus on what the actual mission is — to serve ideal clients. To make reactive filtering function best, it is important to be creating and promoting content that those ideal clients would want to interact with. Don’t make it exclusionary to other companies, but focus your energy trying to attract ideal prospects. You’ll make less work for your sales and operations teams if your marketing is targeted at the right people.
What’s The Bottom Line?
This prospecting step is crucial. If we’re not filtering proactively or reactively, we can very easily drain the operations team by bringing in clients that aren’t exactly right for your business. Having a clear and focused plan and process yields better results. It’s easy to fall down the rabbit hole of overworking, giving proposals and quotes to every prospect that asks for one, and bringing on any client that expresses interest. But sometimes, you have to make choices based on which clients are going to bring more to your table.
