Make your business scalable- "Predictable Revenue sales methodology"
The majority of sales reps still don't have time to sit and read the best practices developed by Aaron Ross in his award-winning book, Predictable Revenue.
That's why we decided to summarize core thoughts that evoke from Aaron and Marylou Tyler's best-selling book for sales reps with limited time to spare, but still want to sound like they've kept up with the latest sales reading list.
Essentially, Predictable Revenue is a structure that creates consistency from year to year and delivers business growth based on a formal process - not hustling and guessing at the last minute. This way, you 'predict' how much 'revenue' your business consistently generates.
If you aim to make sure that your company will have predictable revenue Aaron and Marylou say you must:
Understand your funnel
Determine the acceptable average deal size
Define time frames
They also explain that everything must become a system. Without it, there is no predictability.
The authors use several key terms repeatedly throughout their book. Understand them and you will have a basic overview of the thinking behind Predictable Revenue. Feel free to share them on LinkedIn to show off your latest read. So, let's learn how to create a "machine" that generates predictable revenue for your business.
To implement the "Cold Calling 2.0" process, you must have:
One person who is 100% dedicated to pursuing sales opportunities.
Sales/CRM system
Sales opportunities (prospects) who use email
A proven service that generates revenue.
The customer lifetime value of at least $10,000.
Specialise in the four core sales roles:
Sales representatives: seek customers in cold or inactive companies. Organised according to territories that correspond to field and telesales, as it is important for them to build relationships with their sales colleagues.
One sales representative can handle up to 25 customers (account executives). Very large transactions can take place 1-on-1 or 2-on-1.
Market Response Reps: qualifies incoming sales opportunities that arrive via phone or website. For every 400 sales opportunities per month, a company needs one sales opportunity qualifier, who takes care of removing unqualified opportunities, identifies companies that have sales potential and helps increase the closing ratio.
Account Executives: they should not be in the business of making cold calls: because they don't like doing it; they are usually not good at it, and it is a bad use of company resources. Their job should be to create a clearly defined list of sales opportunities on a '5/10' model, keep in touch with their current client base and develop a referral partner base.
Concentrate valuable people on low-volume, high-value activities and select other roles to perform low-volume, high-value activities.
Time: Increasing the Number of New Sales Reps
Measure and pay attention to reality. Time will vary from company to company, depending on the influx of sales opportunities, people hired, training, and whether they're covering established territory or starting completely new ones.
Implement a process for training new sales reps that have worked for other departments in the company, such as customer service. This will make them more effective at their tasks and their development process will go faster.
Time: Search for New Sales Opportunities and Length of Sales Cycle
Sales Opportunity Generation Cycle Length: Measure the time from when a prospect first responds to a campaign to when a quality opportunity is created or qualified. Qualifying for a new opportunity typically takes 24 weeks.
Sales cycle length: Measure the time from when a sales opportunity is created/qualified to when it closes.
Step 1: Ideal customer profile
Who is your ideal customer (based on experience with current customers and prospects)? Find ideal sales opportunities quickly and just as quickly disqualify those that do not meet the criteria. The ideal customer profile description should fit on one page and be easily accessible to the whole team so they can quickly familiarise themselves with which ones they should try to work with and which ones to avoid. Create a total of 1-5 ideal customer profiles.
Smart Targeting: Choose 35 criteria for smart targeting.
Red flags and deal breakers: What signals or signs can you look for as early as possible in the sales process to know that working together would be a waste of time? An example might be abandoning a project when it is EU funded (too much bureaucracy and lack of flexibility)? Specific budget? History? Recent investments?
Main challenges: Simply ask what are the main challenges of the company and people in the buying process. What are your biggest challenges? What keeps you up at night? What are your main frustrations? What are your main fears? What is most important to you? What do you spend your money on? What do you really want?
Step 2: Build the list.
Does the list include decision-makers (or their bosses) and lower-level people? How targeted is the list? Consider the Opportunity Cost of marketing to poorly matched prospects.
Step 3: Run an outbound campaign through the email channel.
Start with email and then use the phone to follow up with people who respond. Send 50-100 outbound mass emails a few days a week as a mass campaign. Target = 5-10 new responses per day. A higher number is difficult to manage.
Filter your lists based on: Area of operation in the organisation, Revenue, Geography, Employees, B2B/B2C, Last contact activity, Last account activity, Contact title, etc.
Email writing: Personalise the message, don't use HTML to format it (this gives the impression of an impersonal message), be precise and specific, don't forget to outline what the recipient will receive from you, make the message easy to read and digest, offer credibility ( access to customer examples), ask one simple question (e.g. about a referral) and be honest.
Send 150-250 outgoing emails a week for 34 days before 9 am or after 5 pm, skipping Monday and Friday. Always state the purpose for which you are reaching out to the person (who is the best contact.... when is the best day/time for a quick discussion.... around...
If someone opens your email more than once, try to reach them through another channel e.g. call. Talk for less than 30% and listen for the remaining 70% when making calls.
"Old Sales Opportunities" campaign: by your sales rep if the opportunity has been inactive for 6+ months:
Step 4: Sell the dream.
Help your potential customer "draw out in their head" a vision of what solutions your organization offers that will solve their problems, and then connect your solution to their key business issues and dreams. Sales reps don't just set appointments; they create dreams and start building trust, credibility and relationships by delivering on their promises.
Determine fit by checking to see if customers are ready to take action, connecting with the decision-maker(s) and looking for genuine interest in the next step.
Initial questions during an exploratory interview (choose 3-4):
How is your marketing team organised?
How does your marketing process currently work?
What systems and tools do your teams use for marketing and lead generation?
How long has the system been in place?
Why did you buy the old system? Who made the decision to buy it?
What are your challenges now? (After each answer, keep asking "what else")
Have you already looked for alternatives?
Have you tried and been disappointed with other solutions? Why?
Where does online marketing rank on your list of priorities? What is higher?
What would the ideal solution look like for you?
How would your decision-making process work?
How likely is it that an online marketing project will come up in the next six months?
Why are you going to do it now? (Or, why wait?)
First call objectives:
Get them talking about their business and listening for a good understanding of their challenges and proposed solutions
Call people at a lower level before talking to the decision-maker to find out how their business works and what their current challenges are.
Show respect and be blunt: ask directly if there is a problem if it is not obvious after your conversation
Ask for references: Who else should you talk to in other departments/teams or maybe other friendly companies in the industry?
Plan your next step during the phone call, don't schedule it over email.
If the prospect needs to convince others in the team, call her a "champion": focus on what will make this person successful and ask how you can support her, give them information, give time, and check-in periodically.
Step 5: Pass the baton.
When to handoff the contact to other colleagues?
For a sales rep to be compensated, they must:
Have at least the potential for 20+ sales opportunities (provides a high enough chance of closing the sale)
Have no underlying "red flags" or deal-breaker factors
The sales opportunity should be generated by the sales rep (cannot come from other sources)
The sales opportunity be qualified by the person overseeing the process (e.g. sales manager)
When to handoff?
Does the company fit our ideal customer profile?
Are we talking to someone influential or with decision-making power (do we qualify the sales opportunity)?
Is there a clear interest in the next step? (E.g. scoping/discovery conversation with an account executive)
How to handoff?
Best: promptly to the sales manager
Good: schedule a time in your calendar to talk about the sales opportunity.
Last option: email introduction between client and sales manager.
Audit process - confirm after re-qualification by sales manager
Contact was outbound rather than inbound?
Account Executive made a telephone qualification?
Sales rep and account executive entered notes into CRM (e.g. Sales Force Automation)?
This confirms the team's solid ROI, data integrity, quality of work and reduces the temptation to overreach.
Methods of calculating sales representatives' salaries
(*rates are based on recommendations given by the authors of the book)
Quality Person’s Salary: 35,000 - 60,000USD plus bonus: 20,000 - 60,000 USD
New team members who are university graduates selling services 1,000 - 15,000USD at a lower level, 5-year veterans at a higher level.
Commission Structure
Paid monthly
50% based on the target number of qualified sales opportunities
50% paid based on deals that are closed (e.g. percentage of revenue)
Simplified training plan for new sales reps
Week 1-2
General company training, training on organisation, products, services etc.
Week 3-4
Daily definition of 3 objectives (see below)
Daily training
Configuration and familiarisation with CRM
Interview with sales representative and sales manager
Adding company information and contacts from your data source
Learning to re-duplicate companies (make sure new leads are not already in the system)
Sending a mass email campaign to 20-50 contacts
Transferring the area of activity belonging to the previous sales rep
Week 4-5
Set 3 daily targets (see below)
Sending 100 outgoing e-mails before Friday
Practicing proper filing and replying to emails using CRM system
Make up to 5 calls a day before the end of the week
Ensure that a sales rep with more experience has daily contact with a new team member
Create a personal area to visualise work performance
Discuss the new part of the training material with the team
Start implementing daily targets:
Select a new CRM module for further learning
Call five old (not cold) leads to practice determining their needs
Discuss the "Ideal Customer Profile" with a teammate
Familiarise yourself with the consecutive stages of advancement of "Company Status"
Add 5 new companies with contacts to CRM
Send a mass e-mail campaign
Meet with a mentor
Meet with a member of another team
Listen to and learn from the sales conversation of experienced team members
Build relationships with people outside your team (if possible)
Listen and learn from the networking conversation
Intermediate Daily Targets:
Configuration of reports or dashboard in CRM
Customisation of own check sheet.
Practice "call mapping" to cold clients (requesting a referral from the CEO's assistant)
Role-playing with a teammate
Large client mapping project (mapping 3-5 departments in a company from ranked lists e.g. Fortune 1000)
Develop a plan for the month (vision, metrics, methods?)
Role-play exercises: "Business problems vs. Business solutions"
Conduct a "dead sales opportunity" campaign.
Workday planning:
set 3 task goals for the day. If I had to do only 3 tasks today that would bring me closer to achieving my goal it would be....
summarise and present the 3 biggest achievements of the day
Take a break every 90 minutes, eat meals with co-workers, always finish work at a designated time (e.g. after 6 p.m.)
The 6 most common mistakes in the search for sales opportunities
Expecting immediate results.
Writing emails that are too long.
Being broad and shallow at the same time (superficial contact with 100 people instead of contact with 10 contacts who are matched and whose problems are known).
Giving up too quickly on the objective of reaching the ideal customer profile.
Being too tardy in disqualifying profiles that contradict the ideal customer profile.
Relying only on activity metrics instead of taking a holistic view of a proven process (track results, not idle metrics).
Focus on the decision-making process rather than the person making the decision
Avoid:
"Who is the decision-maker?"
"Who signs the contract and confirms the payment order?"
Ask:
"How have you evaluated the delivery of similar services in the past?"
"How does the decision-making process work in your organisation?"
"Who is involved in the decision-making process and what roles do they fulfil?"
"How will the decision be made?"
"What steps must be taken for the sale to close?"
Build relationships, but don't try to sell to decision-makers until you have convinced those with influence over the decisions.
9 steps to create a free trial (of your product, service) that will maximise your conversion rate
Design the trial together with your potential customers and help them run it.
Learn about the potential customer's real business problems before you act.
Agree with the potential customer at what stage the free trial fits into their buying process.
Focus and outline a solution to a smaller number of key problems, rather than trying to solve them all.
Define with the customer what a "successful" trial version process means. What will happen after the trial period ends.
Define milestones during the free trial process.
Register with the potential customer and document the trial version process for future learning and improvements.
Simplify the free trial process.
Set expectations.
Sales Process
(15 minutes) The first contact - should give both parties an answer to the question "Is this a waste of time?"
Set expectations, establish a process to find a mutual fit and position it to benefit them.
"We've found that the best way to quickly figure out whether or not we're really a good fit for each other is through two steps: first, a more in-depth conversation with yourself and the other people you want to bring into the project. And then, if that conversation goes well, a session or group conversation with the key people on your team who will be involved in the project so that we can determine if, how and when we should work together."
(1 hour) Interview/discovery: "Is there a fit?"
Your goal, if there is a fit, to create a plan with the potential client to set up a work session or board session with their key people and decision-makers to meet and create a vision with your key people.
(2 hours) Group work session: "Should we work together?"
Create a shared vision together; walk them through the process of designing how they can and will be successful with your product. Coach the vision with them instead of telling them the vision.
Potential customers who have a need should receive a proposal in the form of an offer
Sending a proposal too soon comes at a cost - the potential customer doesn't appreciate it or your time. When a prospect asks for a price or proposal, don't give it to them until you know they really need it and are also able to take the time to provide information about their needs and business context. Say you're happy to do it, but to do so you need to arrange a scoping call with him and key people to make sure the proposal is accurate and meets their needs.
Sales Opportunities: Seeds, Nets and Spears
Seed - Take the time to 'grow'; through organic web/SEO search, promotion, local user groups, most social media or publishing expert content. This takes time and energy but gets results in the medium to long term.
Networks - Classic marketing programmes; through email marketing, conferences, advertising and PPC.
Spears - Targeted outbound activities ("top 10 company profiles").
Definitions
Prospects - The names or list of people you are marketing to who have not yet responded to your offer.
Leads - Potential customers who have responded positively to the interest shown.
Opportunities - the "lead" met your qualifying criteria and was qualified by the sales representative and sales manager.
Customers - have paid you to complete a project.
Champions - have recommended your company, offered references or actively supported you in other ways e.g. advocated for your solution in your absence.
Five Metrics to Track
New leads created per month (and from what source)
Conversion rates leads to opportunities
Number of, and pipeline dollar value of, qualified opportunities created per month (determines ROI!)
Conversion rates of opportunities to closed deals
Booked revenues in three categories: New Business, AddOn Business, Renewal Business
When to Specialize SDR, AE, Account Managers
Use the 80/20 rule: When your reps, as a group, are spending more than 20% of their time on a secondary function, break out that function out into a new role.
CommissionOnly Salespeople / Account Executives
Pros:
Reduced risk in hiring
Highly incented
Cons:
If your sales cycle is more than a month or two long, they’ll starve o Financial worries will distract from work goals
Attracts more inexperienced salespeople with fewer alternate options
Motivates to “do wrong” to get deals done
Self-Managing Weekly Training Meeting
The agenda often included a mix of topics in 10-15 minute chunks, such as:
Product or sales training
General business topics (E.g., how to lead or manage)
Public speaking practice and feedback
“Dealer’s Choice” – anything the owner wants to include just for fun
Meeting Leader for the week finds speakers, organizes them, and runs meetings, but doesn’t create content
1min: Opening by Meeting Leader / MiniCEO
10-20 min: Sales Skills (Presentation skills, business scenarios, objection handling, pitches, etc.)
10-15 min: Quick Questions (role play prospect questions, answer quickly, and get feedback)
10-20 min: Sales Skills 2 (public speaking, role play phone calls, etc.)
10min: New Best Practice
15min: Industry/Vertical Learning (One team member researches vertical and teaches team)
5min: Meeting Leader Closing (Ask for meeting feedback and choose next leader and content owners)
We hope that this summary of the Predicable revenue book with ready-made flowcharts will enable you to structure your company's sales processes and have more control over the execution of your business scaling plans.
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