The secret to a successful sales territory plan is making sure that your sales team targets the right prospects. You will often hear us talk about segmentation as a central part of sales strategy, but territory planning allows you to take it one step further along the path to sales success. The territories that you choose have the potential to define your business and your success, which means that it is vital that you get it right.
Successful sales territory planning takes segmentation to the next level. Segmentation allows you to divide your target market into specific niches to provide tailored marketing and sales activities for specific customer groups based on their shared characteristics. Your sales territory plan focuses on the process of optimizing sales efficiency by breaking down large groups into smaller, defined territories and assigning specific representatives to them. The result? Specialized sales teams who know what the decision makers in their territory want and need, and who can target and approach prospects and leads with optimal success.
What an effective sales territory plan looks like will depend on your organization, but typically, sales territory plans are based on geos, company size, or industry. With strong sales territory management and more advanced data manipulation, such as the datasets available from RevenueBase, it is possible to gain greater impact from your territories by combining multiple characteristics, for example Geo, Company Size, Industry & Customer Lifecycle.
The creation of a strong sales territory plan will depend on your product, industry and resources, but there are some tips that are relevant across industries and organization sizes.
When targeting your audience, you need to look at the data first. Your data can be divided into three broad categories: historical data, customer behavior and journey, and your Ideal Customer Profile (ICP).
Historical and first party data give you real-time insight into how your customers respond to your existing marketing and sales activities. At the very least, marketing, sales and operations leaders across GTM organizations should be looking at common characteristics within your:
Identifying common characteristics can help you to see your areas of strengths and identify stronger prospects. However, be aware of falling into the trap of thinking that only people within those verticals or geographies are strong prospects; you could risk addressing the wrong audience or missing valuable opportunities. One big mistake that GTM teams make is to assume that the data is static. Your market will be shifting constantly, so in order to be as effective as possible, it is essential that you constantly revisit your data. RevenueBase’s Database as a Service allows you to access real time data when you need it; this prevents you from reacting to outdated information and can put you ahead of your competitors.
We spoke about the importance of alignment in our segmentation piece: Segmentation Strategy Success: A Four-Step Guide for GTM Leaders. If your entire Go-to-Market team is not involved in the finalizing of your sales territory strategy, you risk misaligning your sales and marketing efforts. For example, marketing may run targeted campaigns that produce more leads than sales can handle in certain territories, whereas sales teams in other territories may not have enough leads to pursue.
For marketing teams, one of the biggest factors to consider is sales capacity. Demand generation teams need to know that sales teams have the capacity to act on the leads that are coming their way. Without collaboration and proper planning around sales goals, there is a risk that potentially valuable leads will go cold.
To measure their potential capacity, marketing ops needs to look at the volume of leads they are driving in; past performance provides good insight into what can be expected. Product marketing, on the other hand, will have an in-depth understanding of the market. They will know the type of demand and content that needs to be created, what buyers are looking for during the decision-making process, and how to identify the most promising markets. They may also have an understanding of the regulatory requirements, such as data compliance, and product regulations, that could have a positive or negative impact on marketing efforts.
By working together, sales and marketing operational leaders can identify areas of higher capacity and lower leads – these are the areas that they may decide to focus investment and targeted campaigns on. This is where multiple categories for sales territory mapping and planning can be useful; teams can start with geo but layer on vertical, product or organization size as well to further split out larger territories.
Once you have the entire GTM team on board with your territory strategy, you need to make sure that you have the right staff to achieve success in each territory.
With your territories clearly defined, it is important that your operations are designed to align with them so that you can get the full impact of your carefully planned territories.
Typically, sales and ops managers will review their sales territory strategy and planning annually so that sales reps can get comfortable in their territory. That being said, you should always keep an eye on sales rep head count and capacity to make sure that you have enough talent to meet future growth plans. For example, if your strategy intends to double activity within a specific area by mid-2024 or you plan for new territories to open, you need to make sure that you have the staff in place within that territory to meet that need. You can expand to new territories starting with marketing and BDRs, while assigning relevant leads to existing sales team members to warm up the market and avoid leads going cold.
While an annual review of your territory strategy is usually adequate – assuming you don’t have a large company event take place, such as M&A activity – it’s best to take a more agile approach with the target accounts assigned within your various territories. In order to determine how often you should review the target accounts within each territory, identify the volatile data points that you are using to define your ICP. How easy is it for companies to move in and out of the segments of your GTM strategy? For example, if a key signal of your ICP is the size of a sales team, you may want to review your target accounts quarterly, especially during these macroeconomic conditions. The more volatile the data points are that matter to your organization, the more frequently you should review your target accounts. This will ensure your territories remain aligned with your GTM strategy, and sales reps have clearly defined boundaries, so that they can get the best results. Using outdated information, especially when identifying target accounts to focus your sales and marketing dollars on, will do more harm than good when building and managing your territory plans.
If you want to accelerate your sales and territory planning, sales productivity and operational management, RevenueBase can help you by providing you with the tools that you need to succeed.
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