It’s no secret—the economic downturn has arrived. Leaders across the tech industry are feeling the effects.
Sales cycles are grinding to a halt, pipeline is slipping into future quarters, and companies are reducing software spend.
B2B sellers who have not seen a slowdown will likely see the impact in coming quarters.
The result is revenue leak—the revenue your organization worked tirelessly for, only for it never to become closed-won.
Revenue leak manifests in several ways, including deal slippage, bad data, and error-prone manual processes.
And it’s a bigger threat now than ever.
While so many companies are hyper-focused on cutting costs and keeping the lights on, there’s less attention spent on running revenue and driving business growth.
The increased threat of revenue leak is a byproduct of the economy, but that doesn’t mean sellers are powerless to stop it.
Sales organizations need to take action now to stop the leak and set themselves up for success after the downturn, according to Clari’s Senior Manager of Sales Engineering & Operations in EMEA, Semir Jahic.
Here’s how revenue leaders can adapt their go-to-market strategy to prepare their business for a challenging macroeconomic environment and come out stronger on the other side.
Proof of value is in the pudding
Tech consolidation is sweeping across B2B SaaS (software as a service) to cut costs. Vendors who aren’t making the cut are missing out on new logos and churning existing customers because they cannot prove strong enough value in the sales cycle.
To avoid being seen as redundant, vendors must be prepared to show a deep understanding of their prospect and customer’s business, problems, and goals to deliver on their value proposition. This means researching the company and prospect to:
— Understand the problems they need to solve to be successful
— Uncover the goals they want to achieve
— Develop a strong point of view for how your solution can help
Vendors who fail to do this will find themselves on the chopping block.
Time to value must be swift
Every sales leader knows: Time kills all deals. Extra touchpoints, drawn-out reviews, and never-ending negotiations reduce momentum and put your deals at risk.
And this wisdom applies to new logo business just as it does to renewals. The longer you drag on to get a buyer’s commitment, the higher the chances the budget will get used for something else or frozen entirely.
Your solution might be able to solve your prospect’s problems, but if you can’t prove value quickly, you risk losing their trust and interest. So how can you accelerate time to value to keep deals on track?
Referrals
Your reps don’t have to do all the selling. When you have customers who are raving fans and get value out of your solution every day, bring them into the cycle to do the selling for you. There’s nothing more powerful than the voice of a happy customer.
Case studies
If a prospect opens up budget for a solution, they need to be confident that they will get a strong return on investment (ROI). Providing social proof of how your solution has helped similar companies is a great way to build trust and prove its value to your buyer.
We see this often in our own customer base. Many Clari users are multi-time users, having seen the value of the Revenue Platform at previous companies. So it’s common to hear stories like that of Debra Estrada, Global VP of Revenue Operations at UserZoom.
“As a four-time customer,” says Estrada, “I’ve seen how Clari aligns the entire revenue team to a single operating cadence that creates more rigor and execution towards meeting our revenue goals.”
You worked hard to open the conversation with your buyer. But if they don’t see the value and business impact fast enough, you have no deal.
Identify leak in your internal processes
Selling in a downturn is hard enough—don’t make it even harder with inefficient processes.
The best revenue teams in the world run revenue like a process that can be repeated and optimized. With a reliable sales motion and strong handoffs among marketing, sales, and customer success, go-to-market teams can confidently take action to curb revenue leak.
The danger of revenue leak is that it hides in plain sight. This can take many forms, including deals slipping without warning, not being able to assess deal health, and reps spending too much time on the wrong activities—just to name a few.
This is the benefit of a Revenue Collaboration & Governance framework. It ensures every revenue-critical employee can easily work together to control the end-to-end revenue process and run revenue.
But when collaboration doesn’t exist between every revenue-critical employee and gaps open up in the revenue process, teams are in danger of revenue leak.
The key is to find the leak in your internal process:
Lockstep among growth marketing, sales development, and sales
Marketing spends precious resources to generate leads. The worst-case scenario is that quality leads get ignored. This can be the result of poor collaboration at the top of the funnel between sales and marketing, which means leads slip through the cracks. There must be a smooth process to ensure the right leads get into the right sales rep’s hands at the right time.
A consistent sales process and buyer alignment
Not adhering to a proven sales process or having a mutual action plan with the buying committee is a surefire way to miss out on revenue.
With a consistent sales process and mutual action plan, reps and frontline managers have the insights they need to confidently identify deals most likely to close, spot risk in their opportunities, and shorten sales cycles.
Smooth handoffs between pre-sales and post-sales
Ensure customer success and account management are looped in on the customer’s problems and goals before the handoff so they can deliver value without redundant conversations.
Double down on what works
When the economy goes south, there is a tendency to panic and change the go-to-market strategy completely. Don’t abandon ship.
If you see success in a specific market segment, continue to channel resources into building that client base. If you see strong usage in certain verticals or geos, continue to nurture them and take advantage of expansion opportunities.
The macroenvironment has thrown a wrench in the operating plan and go-to-market strategy for businesses across the tech landscape. But armed with reliable processes and insights into the business, leaders have the agility to adjust their strategy and thrive in the downturn.
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