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Economic downturns are where winners are made.
The 1930s were brutal for the U.S. economy. Yet candy companies had nothing but the sweet taste of success. Hershey, the dominant candy brand during the Depression, remained profitable. Mars launched Snickers in 1930. Tootsie Pops appeared in 1931. Three Musketeers followed in 1932. In more recent times, when COVID-19 brought the economy to a screeching halt, U.S. candy makers broke record sales.
That’s great, you say, but what does it have to do with me? Well, it turns out that success during a recession is not limited to candy companies. In every economic downturn, some companies managed to emerge as winners in almost every sector.
What can we learn from these winners?
Those of us that don’t sell candy can look up to winners in other sectors for lessons learned. Winning companies did a few things differently than the competition. They focused on growth, not just cost-cutting. They also focused on technological competitiveness. And according to Bain’s research, they pointed their sales teams to pursue the top priorities among accounts and prospects.
How winning companies gained ground during the last recession
How can you apply these lessons learned?
So how do you focus on growth, guide your teams to effectively prioritize their efforts, and utilize the latest technology to support these efforts? Here are five steps I can think of.
1. Focus on your Ideal Customer Profile (ICP) by going beyond standard data company filters
When selling gets tougher, the initial reaction is to try to do more, go all out, hit on all cylinders. But going in all directions is a sure recipe for failure during such times. Buyers are clutching their purses, reserving their all-of-a-sudden limited budgets to absolute must-have purchases. Throwing marketing and sales resources at anything that is not your absolute Ideal Customer Profile (ICP) is always a bad idea. It’s a losing proposition during these times.
To reach your real Ideal Customer Profile, you need to consider a wide range of high-definition data points that go beyond the trivial revenue range and industry. More granular data points, such as the type of customers they serve, geographical distribution, and their existing tech stack can be far more important in determining whether a company is a good fit for your product.
To find the prospects that can gain the most from your solution, look for any data points that reveal how they run the business processes and workflows that your solution aims to improve. And staying away from prospects with known showstoppers early in the process can be a huge timesaver for your marketing and sales teams.
2. By hyper-relevant in both your targeting and messaging
With fewer buyers out there, competition on each opportunity gets tougher. How do winners stand out from the competition? They engage buyers with highly relevant value propositions and personalized messages that are anchored in data insights. They signal to buyers that they have taken the time to learn their business, understand their challenges, and propose a solution that is not just cookie cutter.
Say you are targeting organizations that sell products on the Amazon marketplace. Knowing if they already run ads on Amazon can help you tailor your messages from “How to get started with Amazon ads” to “How to make the most out of your Amazon ads.” Or knowing how many reviews they have, you can get very specific with your outreach – e.g., “How to go from 1,000 to 5,000 reviews in 90 days.” The more data points you have, the more relevant and effective you can be with your messages.
3. Cover all of your buyer personas
Broad engagement of all the personas that could influence the sales cycle can do wonders for your close rates in any economic environment. Data from Gong Labs shows that on average, winning deals involve eight different buyer personas contacted via email, compared to just three points of contact for losing deals.
These days, as buying decisions get more scrutiny, covering all personas in the sales cycle becomes even more critical. Deals that go nowhere or get lost to the competition are often a result of late intervention by someone that was not involved in the sales cycle, a painful experience for a sales team that has invested heavily in cultivating the opportunity and gets knocked out late in the game.
And sadly, as more companies look to cut costs, your contacts may have the misfortune of being impacted by organizational restructuring. Engaging a broad circle of influencers early in the sales cycle gives you a stronger foothold in the organization and makes you less vulnerable to unpleasant surprises.
4. Zero in on prospects who can be long-term customers
With dwindling funding and dramatically reduced valuations, the pressure is up to reduce the cost of sales and unit economics. In this environment, retaining and expanding revenues from existing customers is a top priority. To achieve efficient growth, revenue organizations must find and engage prospects that will not only convert to customers, but also stick around and grow over time.
To drive sustainable growth, SaaS companies need to organize their marketing and sales around a funnel that reflects the entire customer lifecycle – from engagement and acquisition to retention and expansion. If in the past you could say “don’t confuse selling with installing”, today it’s the revenue leader that must ensure that value is not only promised, but actually delivered.
Selecting the right prospects based on a deep understanding of the problem you solve for them will put you in a great position to deliver the promised outcomes and accelerate deployment, adoption, and customer success, so renewal and upsell conversations become an easier proposition.
5. Treat your database as a strategic asset
Data is increasingly recognized as a key competitive asset. With the power of AI, prospect data mining can cover more ground faster and with greater precision than ever.
Surprisingly enough, data is still an afterthought for some revenue organizations. Don’t cut yourself short by compromising on data quality. Better and deeper prospect data is the secret ingredient that will allow you to better utilize your team’s time and resources, stand out from the competition, and become the winner in these tough times.
To get this extra edge, look for rich prospect data that includes:
You can also check out how we do it at RevenueBase or request a demo to see it in action.
