Times are tough, the economy is struggling, and your customers just aren’t buying. So what do you do? Let’s take a hard look at your sales and marketing processes to find ways you can close more sales.
How profitable your customers are over time defines your LTV and is a key component of your strategic growth. Companies spend ten times more to acquire a new customer than to keep an existing one. Your current customers already know you, which means they are more likely to purchase from you again, spend more money with you, and therefore are likely to be more profitable. If you don’t know your LTV, then how do you know how much money to spend and on which customer segment?
Every customer buys on a cycle. So this means you should track cycle times and variance to increase the accuracy of your forecasting and the loyalty of your customers in order to close more sales. If you don’t know when your customers need to reorder, then you may just lose them when the time comes for them to reorder.
There is an old sales adage that time kills deals. The speed at which each prospect converts into a customer and the number of prospects required for conversion determines your sales cycle efficiency. So ask yourself – are you taking the right steps to measure and reduce lost sales?
Only about two percent (2%) of sales occur on the first contact. Eighty percent (80%) of your sales will require five to eight contacts or touches of some type before you close the sale. In other words, if you are contacting the prospect less than five times or more than eight times, then you could have a problem with follow-up in your sales process.
To keep the sales pipeline full of good quality leads you must continuously increase the awareness of your company and the solutions that it provides. Public relations is more efficient at building awareness than advertising, yet many companies spend wildly on advertising and trade shows while neglecting to fund public relations efforts. Increase your name recognition, not your budget. Use more cost effective public relations.
Do you have methods in place to measure the conversion potential of each lead? Lead qualification activities should pre-qualify every lead to ensure you take the right follow-up actions for the marketing offer. Strong leads produce strong sales.
Lead generation is a process, not an event. So you need to ensure that you have a regular stream of article publishing (blog) activities occurring. In today’s web 2.0 connected world, you should be using social media sites like Twitter, Facebook, or LinkedIn to increase your exposure and connect to your community.
Discounts represent deficiencies in your sales & marketing processes, which means you should be careful how often you discount. Instead, look for the root cause of your sales or marketing deficiency and you will reduce the need to discount. Customers believe opportunity costs outweigh operating costs. If you show your customers your value (more marketing), they won’t focus so much on price.
Provide your sales and marketing people with more regular formal training. Arming them with better product knowledge, as well as presentation, negotiation and selling skills, will improve their effectiveness and boost both employee morale and your bottom line – a win-win for trying to close more sales.
Know what problem you are solving (as the customer sees it) to create an accurate value proposition. Don’t pretend to understand the customer… ask them. Obtain the voice of the customer through interviews, focus groups, and real two-way communication. Ask probing questions to ensure that you have an accurate definition of your product. Remember, a product encompasses everything that customers experience, including all the people the customer comes in contact with to make up the experience itself.
Use these techniques and you will be sure to close more sales for your company!