Business growth: What to do when sales go south

Sometimes a company whose marketing strategy is good but whose sales are declining will discover a mismatch between their target market and their promotional activities.”

Declining revenue is a red flag for any company, but especially a company with its sights set on growing.
 

Although your first response may be “sell harder, sell more” that may not be the best solution to the problem!
 

Before you can turn sales around you need to understand why they are declining:
 

  • Your marketing strategy could be flawed
  • Your promotions may not be getting to your prospective customers
  • Your sales management processes may be inadequate
  • Your sales team may not understand their job - or be up for the job
  • Some combination of the above


It’s better to take time to identify the real problem than to throw money and energy at something that turns out to be the wrong solution.

 

Analyse your marketing strategy

 

To determine whether you have the right marketing strategy, ask yourself:

 

  • Given the current set of products/services we offer, who have we targeted and are they the appropriate customers?  If the answer is “all good”, then is the market too small or already saturated? 
  • If, as they say in the venture capital trade, “the dog is not eating the dogfood”, do we need to change the dog food? Or change the customers we’re trying to sell it to?
  • Are our “promotions” reaching our target audience? Are we trying to use broad brush media when we should be sending individual messages to specific people?
  • Did we underestimate the strength of our competitors?  Why are prospective customers buying from them and not us?
  • Have we “delivered on our promise”?  Is our product or service doing what we advertised it would?
  • Have we made it difficult for people to find and buy our products or services?
  • Is our pricing strategy appropriate or relevant?

Answers to these questions will help you determine whether the problem lies with your marketing strategy. If everything checks out, then look at your promotional activity and  the performance of your sales team.

 

Review your promotional activities

 

Sometimes a company whose marketing strategy is good but whose sales are declining will discover a mismatch between their target market and their promotional activities.

 

Assuming you are targeting the right prospects with a product or service they want at a price they are willing to pay, your promotional activities should:

 

  • Engage the target audience by delivering a creative message at the right time or place
  • Persuade the target audience by changing their thinking, their feelings or their actions

 

Does your promotional activity address the barriers an audience may have to considering your product? Also consider the barriers a target audience may have in converting to your product.

 

The job of sales

 

A salesperson once told me, “I follow up on every lead that comes in through the website. Marketing just needs to get us more leads.”

 

Too many salespeople think marketing is there to deliver customers who want to purchase – and the job of sales is to overcome objections and “close the sale”. In fact, the job of sales is much more than “order taking.”

 

Marketing has an arsenal of tactics to get the company and its product and service in front of the target market. But it’s the job of the sales team to identify specific companies within that target market who need, want and value the product or service.

 

It’s also the job of sales to figure out who has money and authority to buy it, then offer a compelling argument for buying it. If your target is the top 200 pharmaceutical companies, your sales team should do their research, create a brief for each of them and identify the people who have the authority to sign the order.

 

Just like prospectors searched for gold, salespeople need to prospect for customers. Sometimes you get lucky and find a chunk of gold lying on the ground – a warm lead from the website. And although marketing can identify the places where gold is likely to be, the salesperson is the one with pick in hand to extract the gold.

 

The sales team needs to identify specific companies that need or want your product or service. Then develop a relationship with them in order to move them to a “buy” decision.

 

The sales team needs to know how to carry out the marketing strategy and when to use marketing tools such as brochures, infographics, product webinars, customer testimonials or personal experience.

 

Join the next ANZ Business Growth program webinar

 

Register to attend the next webinar Strategies to grow in revenue and margin, on Tuesday 18 October 12pm - 1pm AEDT, with Dr Jana Matthews and CEOs from the ANZ Business Growth program.

 

The ANZ Business Growth Program includes free webinars which are open to all Australian businesses. 

 

Gold or dirt

 

Salespeople are inherently optimistic and not always good at predicting if a prospective customer will “buy”. So there needs to be rigour to the management of the sales process.

 

A company’s future depends on its salespeople being realistic about whether there’s really enough gold “in them ’thar hills”, how much time will be required to extract it and whether they should move on to another more promising hill.

 

At the outset a salesperson must answer a range of questions:

 

  • What Need the customer has and can our product/service meet that need?
  • What is the Probability this prospect will buy our product or service?
  • The Estimated Date a contract is likely to be signed and order placed?
  • What is the Decision Process and who is involved?
  • Will our Revenue/Profit justify the sales time/effort required?

 

Sales job requirements

 

In order to answer these questions and deliver the sales budget a salesperson must:

 

  • Follow-up: contact leads, qualify them and follow up
  • “Prospect for gold”: research potential customers and contact prospective companies. Think of sales as detective work!
  • Know the product/service and be able to explain how it differs from rivals. Know where the company and product fits in the value chain. Understand the “math” and be able to justify the price.
  • Listen: build rapport with customers, reads body language, handles difficult situations. Uses listening skills and questions to diagnose a customer’s need.
  • Be professional: has a sales plan, dresses for the role, is polite, on-time, organised, well-prepared and documents the call. Does not take “no” personally.
  • Develop accounts: meet regularly with customers, expands contacts within a target company, responds promptly and – over time – ‘grows the business’.
  • Be consistent: achieves targets every month, meets minimum requirements each call or meeting.
  • Close sales: has good answers to questions, able to overcome objections and close a win-win deal.
  • Follows-through: Keeps promises, never lets internal or external customers down.

 

Know when to walk away

 

Time is a non-renewable resource. Time spent trying to sell to a customer who is not ready to buy is time that could have been spent with a prospect that will produce revenue.

 

A salesperson must continually assess prospects and be honest about whether potential revenue will be worth the time and energy required. Knowing when to “hold ’em and when to fold ‘em”.

 

Knowing when to “hold ’em and when to fold ‘em”

 

Knowing when to move on to a more promising prospect is an art and a science.

 

If the answer to any of the following questions is no, then “fold ‘em” and walk on to another prospect.

 

  • Do they need or want or value the product or service?
  • Do they have budget to buy the product/service? Focus on prospects who have money and are ready to buy.
  • Does the person have the authority to place an order? If not, find out who does.
  • Does the customer have a timeframe for making a decision? If not, establish when they will  and flag a follow up.
  • Does the customer trust the salesperson? If they don’t trust the salesperson, they won’t trust the product, service or company.

 

In short, there are many reasons why sales and revenue may be declining.

 

But before making a precipitous decision analyse your marketing strategy, review your promotional activities and assess the performance of each salesperson and the management of their pipeline.

 

You may find some gaping holes or you may find the need for a few tweaks. Use the opportunity to learn, reassess, recalibrate, adjust and prepare for more sales – and for the next stage of growth.

 

Dr Jana Matthews is ANZ Chair in Business Growth Director and Australian Centre for Business Growth at UniSA Business

 

Imitation is not always the sincerest form of flattery

As a new domain namespace launches in Australia, business owners need to remain vigilant to the threat of online fraud.

Marketing and sales…in that order!

Many businesses jump straight to sales to generate revenue - missing the crucial step of a marketing strategy. Dr Jana Matthews explains why market research and a solid plan ensures the best chance of success.

It’s not the ‘Big Quit’. It’s the ‘Big Life Assessment’!

Key takeaways for businesses to retain employees and meet expectations resulting from ‘The great Australian Life Assessment’.