We recently held a session with our Founder & CEO, James Ker-Reid, who talked us through what the necessary elements are for any B2B tech startup that is trying to craft its sales strategy. If you’d rather watch the session, click here to view the recording via our YouTube channel.)
In this masterclass we’ll be covering:
- What’s the analysis I need to do first?
- How do I structure my sales strategy?
- How do I structure a realistic and executable plan?
- What should a plan look like?
- What are the best practices for smartly executing my plan?
1. What’s the analysis I need to do first?
When we’re looking at our sales strategy there are obviously quite a few inputs, in order to come to the decision and the direction we want to go in.
We start with:
- Goals & Outcomes: where is it there we’re trying to get to? What are the milestones we want to hit? It’s crucial we know exactly what we’re aiming for first.
- Problems: These are often surface-level issues that come out – whether that’s not having enough leads, not converting enough customers, deal value is a little bit low, etc.
- Root Causes: We want to identify the root causes of these problems. This is often overlooked or skipped over. We need to clearly understand why some of these problems are arising.
- Options & Assumptions: Once we’ve done that, then we can look at what options we have to fix these problems.
- Machine Design: Only once we’ve weighed up those different options can we really start to build that sales machine that pieces those solutions together.
Goals & Outcomes
First and foremost, you need to embrace reality. We hear so many tech startups say that they want to grow 4000% in a year. We would never want to dampen that spirit or ambition and believe in aggressive expansion ourselves, but we need to understand what today’s state is in order to visualise what our desired state is. Where do we want to be in a year’s time?
Don’t try and gloss over reality. This is business and it can be harsh. There are people’s livelihoods and reputation on the line. The more we lie, deceive and misdirect our team, the harder it is going to be for us to create an excellent sales strategy and therefore a growing business with predictable revenue.
Problems
We’ll outline some of the data points and sources you’d typically use to understand what’s going on in your company. These won’t necessarily give you the root causes but they will give you some conclusions and realisations from the data you collect.
- Marketing – what are some of the trends in our marketing operation? Look at some of your marketing analytics such as Google Analytics, your CRM if it’s housed there as well, any email platforms also, lead pages, etc.
- Sales – what is the reality of your sales operations? Look at the different stages and the progression within them, look at the deal value and deal volumes per stage, the time within each stage, etc.
- Customer Success – what happens when a customer signs with you? Really dig deep into that onboarding and growth journey from a new customer to an advocate. What does that look like?
- Financial – what are some of the trends in the buying patterns of your clients? This is sometimes missed by ‘strategists’ – you want to correlate the three previous growth drivers with financial data. A customer invoice report is often one of the best ways to do so. This will help with some of the buying trends.
- Next Steps – How reliable is this data? How much of it do you have? Hypothesis worthy?
Root Causes
There are a few questions that we’d recommend you take on when looking to build your own sales strategy:
- What are the reasons why I’m noticing this problem?
- When did I notice this problem?
- Who is responsible for this problem?
- What isn’t happening?
- What is happening that shouldn’t be?
These five key questions are not the exclusive list but will definitely help you to understand some of the causation behind some of your problems to date.
Options
When looking at these options, asking yourself a series of questions will often help in evaluating which option is best.
- What are we really capable of doing?
- What are we willing to do?
- Does this solution match our existing skills, resources, and time available?
- What don’t I see?
- How much of our progress is down to a lack of realistic expectations or poor execution?
- What’s the upside? What’s the downside? Can I live with the downside?
- How could we screw this up?
2. How do I structure my sales strategy?
There are three key parts to a sales strategy. We’ve analysed 216 startup mistakes in the market and found that there are three key areas that you can assimilate all of these problems to:
- Proposition
- People
- Process
Your Proposition
If you’re interested in downloading a Value Proposition framework, to leverage at your own startup, you can check out the Sales for Startups Value Proposition Guide here.
This free canvas is the first exercise towards understanding, clarifying, and leveraging your own Proposition. That really is the bedrock of any good sales strategy. It’s market and value identification for that product or solution that you have. This is arguably the most important thing to have clarified, otherwise, you could hire the wrong people, put in the wrong processes, and overengineer things when they don’t need to be.
That’s why we have to get this right. This is the first step before your sales strategy. This needs to be called out clearly within your organisation so that everyone can centre on the same idea and the same mission.
Your People
When you think about expanding your team or ultimately looking at improving the people that you have, we need to think about:
- Company Goals
- Target Customer
- Sales Cycle
- Market Opportunity
- Budget
When it comes to what budget you have available, think not only about operational cash but also financing cash if you’ve recently raised and projected revenue that is due to arrive in the business. What sort of expected timeframe do you have for onboarding, break-even point, and profit point for those new starters.
Really ascertaining what you have in front of you and what budget you, therefore, have available will help to inform your choices as to the people you put into your sales strategy. Don’t forget, it could be reallocating resources within your team to more clearly defined roles within your sales strategy.
We also get asked a lot about sales structures. We’ve put together a couple here and, whilst it is not an exhaustive list, it is
an indicative guide of what a flat, pod, or specialised structure looks like:
With the flat structure, to pick an example, you may be in this camp at the moment where you’re the Founder & CEO and you have a couple of Sales/Customer Success people reporting to you. In order to accelerate growth beyond the £1 million ARR level (especially Series A and beyond) are often looking to build pods that are self-sufficient and self-fulfilling as well.
Often what you’ll then see in bigger businesses which some of you may have experienced before is specialised functions – for example, inbound and outbound functions and leaders. Within these larger teams, such as closers and farmers, there may be several roles within those teams.
Processes
Moving on to the third element of the sales strategy, we often talk about the Dynamic Trio:
- Sales Process
- Lead Acquisition Process
- Nurture Process
Especially at the Seed and Series A stage, the game here really is conversion. We need to show that we have traction in the marketplace and therefore this Dynamic Trio will get you where you need to be. This is getting predictable revenue quarter on quarter and looking like an attractive, systematic operation that can be supported by external funding (whether that’s debt or equity for example).
Next up we’ll be discussing how you go about structuring your plan, what a plan should look like, and how you go about executing it. You can access our second installment of the session soon or, if you’re keen to jump ahead, you can access the full recording of James’ masterclass here.