How start-ups can ignite their post-pandemic sales recovery
By Paul Fifield, CEO of Sales Impact Academy
The statistics are shocking. More than 90 per cent of start-ups fail and even businesses that go on Series B and Series C funding have failure rates around 70 per cent.
How can start-ups move up the sales gears as they navigate the post-Covid landscape? From reassessing who the right customer is, to targeting the right metrics, there are decisions and tactics that can make or break a company.
Despite the gloom about Covid-19, many businesses – large and very small – are thriving, even in markets that appear to be very mature and crowded such as fitness or wine delivery. Start-ups are still being funded – from disruptors in the second-hand car market, to server technology and data-mining. They just need to get their sales right.
Yet there’s no denying it is tough for new businesses that may have funding but are struggling to make an impact. Here are some insights from the frontline that will help start-ups through the difficult initial phases and have positive impact downstream as we slowly emerge from lockdown.
Be brutal about prioritising customers
Given the stinging effects of lockdown on many businesses and markets, you may have to impose brutal discipline about which customers to target. It can be painful, but start-ups need to give themselves the best possible platform for success by concentrating on the ideal customer persona. Identify your customer persona based on the data you’ve collected from user research and web analytics. This may require a new set of skills, so be prepared to acquire them through training. Be ready to develop a framework, to A/B test and learn from the results.
If the sales function within a business concentrates on the highest-quality leads, it will maximise the return from its resources. Developing a detailed ideal customer profile (ICP) helps businesses better understand their target accounts and prioritise which prospects are best to contact, which means more accurate forecasting and greater sales.
Where many organisations go wrong is neglecting measurement. Focus on a handful of metrics that track your own strategic objectives.
Top level metrics will be the number of qualified opportunities created each month by your SDRs or 360 reps, the conversion rate of your qualified opportunities, the time it takes to close and the average contract value.
The big watch out here is tracking your leading indicators of success like a hawk as small slips in say, the number of opportunities created each month and conversion rates, have a massive impact on your downstream revenue.
Build a strong recruitment process
Getting recruitment right is a vital necessity. Start-ups should avoid the understandable temptation to recruit sales directors or heads of sales on large salaries. There could be a time for that later in the business’s growth, but it is not now. Concentrate instead on building a highly-motivated sales team, who each have total understanding of the product or service and how it meets customer requirements. They must be able to convey that authentically in their conversations with prospects. This is a set of attributes that can be developed through training, injecting a sense of authenticity.
Conversations not sales pitches
There is much talk about authenticity in the post Covid-19 world and it is easy to be sceptical. Try to resist that temptation. Many sales interactions will continue to be conducted remotely for quite some time. The people you view as prospects may have reassessed their attitude to life, to work and how to approach procurement or run their business.
All around us we can see organisations suddenly finding they have time to reassess what they do. Being openly true to your business and its values makes a big difference. If you can convey it in interactions with prospects it will be more persuasive. It is a question, initially at least, of conversations rather than results-focused sales pitches. Take time to think about the pressures the other person is facing and how they might be rethinking their own strategy or tactics as we emerge from the pandemic.
Train for the future
Global management consultancy McKinsey in its Mental model to enable rapid revenue recovery published in May this year makes clear the pandemic will trigger change which requires appropriate responses. It references a “Start-up mindset” which focuses more on action than research, testing over analysis. Start-ups are more agile and more attuned to opening up digital channels to grow sales and increase engagement with prospects.
This may be true, but no start-up should rest on its laurels if it has a business model that survives the onslaught of Covid-19. Start-up sales is a specialised area that in the post-lockdown landscape will require honing of existing skills and development of new ones. Who for instance, is already optimising use of social channels, especially LinkedIn? Does everyone on the team really know how to sell remotely? Do you understand how you respond if your prospects’ budgets have taken a hammering? Training will be essential to growth in any market after lockdown is eased.
These are just five tips that all start-ups need to consider as they face the challenges of building success in the aftermath of Covid-19. Nobody can honestly say they have previous experience of a situation like lockdown, but there are definite steps that start-ups can take to optimise sales and give themselves the best chances of succeeding.