The Mistake People Make
If you sent out a marketing campaign to 100 people, had phone conversations with 10 of them, set up meetings with 3 of those and converted 1 to a sale, would you be pleased?
This is the way that many organisations measure their sales effectiveness and a lot of them might well feel that the result above was a good one. A 100 -> 10 - > 3 - > 1 ratio is certainly a very typical one in a ‘push’ sales environment; that is, a sales process where the business is pushing out their contact strategy to find and close leads.
An example of this is lead generating companies who send out unsolicited messages on LinkedIn and offer to implement the same strategy for your business. These companies are using the above ratio and unless they are combining it with a very clever brand and marketing campaign, will in fact be destroying your brand and your future business opportunity.
Putting the metrics to the push strategy
Let’s look at the real cost of the push sales technique. Let’s turn it on its head and think about all the people who reject your message, rather than the one who accepts it.
If we have a ratio of 100 to 1 from receiving the message to sale, then logically for every 1 sale, 99 people have rejected our message.
Expand that out and eventually for every 1000 clients won, we have shared our message with 100,000, of whom 99,000 have rejected it. That is a massive potential detraction from our message and the value our business offers.
If you take this argument far enough, and put it in the context of Australia having 24m people and 2.4m businesses, you’re eventually going to run out of consumers or businesses to sell to as the numbers who have rejected your message increase 99 times faster than the number that accept.
There are still many sales programs and approaches that are built around handling rejection. The aim is not to be rejected, by ensuring that your brand and your sales strategy are linked, so that you are only speaking to those who are looking for you and would like your support and help.
So in this article in my Growth Metrics series, I’m going to explore an alternate approach to sales and a different ratio.
The alternate ratio, 10 -> 9 -> 7
What if you could move from 100, 10, 3, 1 to 10, 9, 7?
What if 10 potential clients contacted you, you make appointments with 9 of them and convert 7 of those to a sale.
This is a pull-led, rather than a push-led strategy and it’s a very powerful driver of growth.
A pull strategy is based on having a brand-led business. By ‘brand-led’, I mean that the business’ brand is an end to end revenue system that starts with understanding who you are there to serve, and is supported by a product ecosystem (the right product at the right time for the right client), delivered through effective channels.
My colleagues Linzi Boyd and Sarah Skeats are experts on this, and through the Business of Brand (BOB) school, work with businesses to help them build that end to end system.
When your brand forms an end to end revenue system, deals will flow, and potential clients are introduced to you, meaning that your conversion ratio is improved out of sight. The other big plus is that even the people who don’t buy still have a positive view of you – it’s just not right time for them, or they are not in your target market.
Part of the brand revenue ecosystem is sharing value (i.e. give stuff away) to bring people to you. For example, this series of Growth Metrics articles is part of my own pull strategy. I share information, knowing that those who read and value it will call me when they are ready for more structured and personalised advice.
It is also speaking your purpose, having clarity on who you are talking to and why, adding commentary to other expert opinions, living your brand. It is ensuring that every form of communication – verbal, digital, visual – supports and enhances your brand.
If you can do this, then your message will resonate with your target audience. And when a message resonates, people act.
Brand starts with communication and is followed through with a good sales process.
The hallmarks of a ‘good sales process’.
In working with my clients on their sales processes, three things stand out time and time again as being the most effective:
1. The sales process has a structure that creates a relationship with the client and confirms that the value you have is a match for what they need.
2. A good sales process doesn’t have an attachment to getting a sale – what it does have is an attachment to ensuring a client’s needs are met. Push strategies tend to be more driven by the sale, than the clients’ needs.
3. A good sales strategy has a relationship-driven process that qualifies a client in or out. If the client is qualified out and the business cannot deliver to their needs, they can still add value by referring them to someone who can deliver their requirement.
Calculating the ROI on a push vs pull strategy
Think about this – for every 10 phone calls and three appointments to get one conversion, how much time and energy is taken to achieve the result?
Now for the alternative – 10 phone calls and 9 appointments to achieve 7 conversions. How does this feel in comparison and how much time and money have you just created?
