Five Ways to Drive Revenue in a Downturn
In 2023, many companies will need to do more with less.
By Rich Brown and Erika Nolting Young
The San Francisco Bay Area alone has already seen many technology companies make significant layoffs, with more companies planning cuts over the upcoming weeks. Those who remain in their roles will be asked to deliver more, with fewer people and less budget.
Much is being written about the “less” side of the equation (i.e., how to cut costs). This article, however, aims to focus on the “more.” How can companies deliver more during these challenging economic times? Below are five plays we’ve seen companies use to help drive revenue growth in downturns.
Five revenue optimization plays:
- Drive focus on high-value customers
- Draw insights from your data
- Partner wisely
- Retain top-performing sales reps
- Hone go-to-market processes
Play #1: Drive focus on high-value customers
The chief revenue officer (CRO) at a well-known company tells his team, “Don’t forget the F-word”. Focus becomes increasingly important in a downturn. Focusing on the highest value customers is critical, but don’t make the mistake made by many, where the algorithm used to identify the most valuable customers (MVCs) is based only on historical data.
Of course, it’s important to retain and grow the accounts that have done a lot of business with you in the past. But, ignoring high potential value customers (HPVC) can be the difference between a significant up-year, and a down-year.
The acronym HPVC may not take off, but the concept of HPVCs is here to stay! If your sales ops team hasn’t built an account segmentation model based on potential value, this should be your first step towards driving focus in 2023. There should be acquisition and retention cuts before running a Pareto model on the data to uncover some hidden gems. You’ll likely re-think your sales coverage model, driving more focus against the highest potential value customers.
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Play #2: Draw insights from your data
A prediction: 2023 will be the year that we start to see customer 360s (C360s) become more insightful and useful to executives, marketing leaders, and sales reps. To date, companies have used C360s as static dashboards depicting a plethora of data or information. Users must dig for insights. How about instead, you deliver them the insights that help them make the right decisions, and drive positive change?
For companies that are already starting with a clean data set, well-defined hierarchies, and governance, a C360 that is value-added for users is a realistic goal for 2023.
To move beyond data and information and generate insights, be selective about where you start. The 360-wheel depicted here gives some examples, but you’ll need to prioritize based on what’s most important to your situation — it’s not realistic or advisable to do everything at once. One starting point that all sales teams get excited about is identifying the product/solution whitespace in accounts. It’s a simple insight that can help drive additional sales.
Over time, with the help of machine learning (ML) and artificial intelligence (AI), you can start to think about recommending actions.
Play #3: Partner wisely
It’s still common to see partner organizations measure success against the number of new partners they have recently signed-up. Sometimes, quantity of partners can be important for growth. However, high growth of the partner base often equates to overhead. Providing onboarding, training, certification, and other partner perks is resource intensive. And if there aren’t any tangible commitments for partners to deliver revenue, that’s an uncertain path to ROI.
It’s time to determine which partners and partner types are delivering a positive ROI. Just as segmentation is important to drive customer focus, wise revenue leaders understand it’s important to segment partners according to delivered and potential value. Doubling down on those that have been, and can be, true partners will deliver a win-win relationship.
Play #4: Retain top-performing sales reps
Sales reps can be incredibly loyal, but they are also human. In a time of economic uncertainty, if they perceive that their role or any in their inner circle is at risk, they will start to look for other options in the market. You need to head that off at the pass; put effort into retention practices and improvements to the employee experience.
These don’t have to include incentives or monetary measures — research by Forbes suggests enabling sellers with the right insights, tools, and support to onramp successfully and gain momentum, can positively impact sales rep retention.
Play #5: Hone go-to-market processes
Some of the most successful sales reps are engineers at heart (while some actually studied engineering). These reps are skilled at breaking down processes to determine the steps needed to be successful. They determine how to execute each step efficiently, and how many times it should be repeated before they accept failure. They meticulously hone their go-to-market processes.
But the chances are, most of your sales and account reps are not process gurus. However, they will benefit greatly from operating differently. Start by mapping out go-forward processes that bring leading internal and external practices to the party. That can mean pure process changes, but it can also mean providing them with data insights and introducing or re-configuring digital technologies that will improve enablement. You’ll see improvements to cycle times, close rates, and the feedback loop to both marketing and product teams.
Doing more with less is not easy, but these five plays will help move the needle. It is important to remember that delivering any of these plays requires both planning and execution. All too often we see companies do well with the planning but fail at the execution. They forget that change is hard, and people will only adapt when they want to or must, especially when you are asking them to do more, with less. Help your team understand the strategy so they will want to change.
Thanks to David Lewis and Jennifer Leong for contributing to the article.
Slalom is a global consulting firm that helps people and organizations dream bigger, move faster, and build better tomorrows for all. Learn more and reach out today.
