Every business experiences sales cycles.
Sales pipelines and close rates ebb and flow based on many factors – some are market driven, some are internally driven. Business leaders learn to expect these sales cycles and plan accordingly.
But, when sales stagnate or decline for multiple months, there is something else happening. Since most business executives are “big picture” thinkers, their natural tendency is to first examine the business strategy. Has the market fundamentally shifted such that the product-market fit has weakened? Are new competitors in the game taking market share? Have the partners and allies changed direction? Is the product being disrupted by new technology? Any number of strategic factors may be the root cause of sustained sales stagnation, and business leaders need to continually monitor what’s happening outside the company for their business to remain relevant.
Strategy changes take lots of time and planning to implement.
If your sales have flat-lined, you need to respond quickly. Time is not on your side. In these situations, look at your Operating Model. Where Strategy is all about the “why” and “what” of your business, the Operating Model is about “how” – it’s about execution. When sales stagnate or decline, in addition to examining your strategy, examine your customer acquisition Operating Model. You may have hidden opportunities to recover sales growth and earnings by making changes to how you find and acquire customers.
To start this examination, map out exactly how you acquire customers today. This map is your status quo. For most businesses, the customer acquisition status quo looks very similar to how other companies in their industry acquire customers:
- Marketing generates awareness using advertisement, direct marketing, email campaigns, tradeshows, webinars, social media, analyst relations, etc.
- Marketing creates “pull” to the website using email campaigns, webinars, social media, and SEO/PPC
- Marketing captures the names of interested prospects (aka “leads”) via web form registrations, tradeshow giveaways, and webinar registrations
- Leads (names) are passed to Sales for Sales to qualify for Budget, Authority, Need, and Timing (BANT)
- Sales engages the qualified prospects and, hopefully, closes most as new customers
- Rinse and repeat.
If you have been in business any length of time, you have optimized your customer acquisition Operating Model around status quo. The problem with status quo is that it gets comfortable. But if sales stagnate, chances are your customer acquisition Operating Model is stale. Status quo is no longer getting the job done. It’s time to change status quo.
Here are some ideas for adapting your customer acquisition Operating Model:
- Think like your prospect. How do they find out about potential solutions to their business problems? What do they do to research their alternatives? Who do they listen to for ideas?
- Re-examine your marketing communication channels. Most of the research today is done by Millennials. Millennials are tech savvy and social media mavens. They don’t “do” tradeshows and their preferred communication platform is text, not email.
- Entertain to educate. Are you still publishing product-centric white papers? Publish a short, fun video on YouTube instead. Sixty minute webinars? Too long. Make webinars thirty minutes or less and feature one of your customers telling their story of how your product or service helped them.
- Set your content free. Any marketing content worth publishing must be frictionless to access. If you still require your web visitors to fill out a form before they can access your content, you are telling 95% of your readers to go away. Better yet, publish your content openly in social media.
- Open the aperture. A good collection rate of web visitors who self-identify is 2% – 3% of all web visitors. If your web lead capture is focused only on the visitors who self-identify, you are wasting a valuable resource. Invest in a solution to identify the other 97% of your web visitors, and make sure the solution you implement can also tell you what these visitors looked at.
Sales cycles are normal for all businesses; sales stagnation or decline is not normal. When sales flat-line over an extended period, it’s time to re-examine both your business strategy and your customer acquisition Operating Model. Fixing your business strategy may be what’s needed for (re)gaining long term sustainable competitive advantage. In the meantime, re-examine how you acquire customers and be prepared to change status quo.