Tag Archives: economy

Reset the Sales Funnel for Revenue Forecast Accuracy

In case you didn’t notice your customers are buying differently today than they did last year.  The differences could be subtle or obvious, but if you observe closely you’ll see that the process they follow to make a buying decision–the buyers’ journey’–has changed.

If your selling process and sales funnel structure haven’t adapted to the buyers’ journey the efficiency of your sales and marketing efforts will be down and so will the accuracy of your revenue forecast. This is what I call the new “Funnel Economics”.

Here are the major variables in a sales funnel (which I am now going to refer to as the revenue funnel because it should be co-owned by marketing and sales).

  1. Stages of the buyers’ journey
  2. Lag time between stages
  3. Leakage rate at each stage
  4. Advancement rate at each stage
  5. Number of meetings required in each stage
  6. Number of meetings that each sales person can expertly handle in a week
  7. Number of available sales people
  8. Average revenue per order

Any change to any of these variables has an impact on how many deals get closed in a period of time.  The marketing and sales effort required to generate a level of revenue last year is very different from what it takes this year.

If you’re still trying to plan and forecast based on last year’s funnel structure, you’re not just flying blind you’re flying with the wrong instruments.

Reset your revenue funnel by analyzing and observing the customer’s current buying process and  behaviors.  Dial in the new metrics into your revenue funnel and monitor carefully over the next several months.  The accuracy of your revenue projections will improve.  What’s more, you’ll  have a more realistic preview of what type and level of activities are necessary to achieve a certain revenue outcome.

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Deep in the Heart of the (Sales) Funnel

(This is a copy of a post I made on my other blog, One Riot – One Ranger)

When the going gets tough, the tough fine-tune their sales funnel processes for greater efficiency and effectiveness.

So many companies today find themselves trying desperately to succeed with fewer marketing and sales people and with less budget.  I like to think of this situation as having to step into the OK Corral with only four  bullets in my gun instead of six.  Every bullet has to hit its mark. No room for waste or ineffectiveness.

Marketers and sales people realize this, but it does raise two questions:

  1. What should we be doing more of?
  2. What should we be doing less of?

If a company’s sales funnel has been designed around the buyers’ journey, and if both Sales and Marketing have aligned their strategies and tactics to this journey then they will find the answers to both questions in the metrics that result from a well managed sales funnel.

If there isn’t alignment around the buyers’ journey then sales and marketing are likely working at cross purposes to one another and there is an unacceptable level of trial and error in the tactics.

Research* has proven that companies who have aligned their marketing and sales activities to the buyer’s journey win 38% more of their proposals, lose 36% fewer customers each each year and grow 5.4 points of growth more than companies who aren’t aligned.

Not all sales funnel processes are equal. Most are too simplistic or are centered on the seller’s journey not the buyers’ journey.  A rock-solid funnel model factors in lag, leakage, and recycling–there’s nothing “simple” about the dynamics of a funnel.

There is a way to mine the  sales funnel expertise of major corporations around the world. You simply need to plug into the minds that developed the processes for these global brands and built the tools to support the processes.  That is easy.  The world’s leading authorities on sales funnel management and performance are at MathMarketing. They now offer black belt workshops  that teach companies and marketers how to do this.  Known as the Funnel Academy(tm), these workshops are now available in the U.S. CEO’s should make these programs  mandatory for every B2B marketer and sales manager. For that matter the CEO’s should participate, too.  This is the best B2B marketing training on the planet.