January 20, 2020
3 min read
Like all things that mature, we can chart a company’s growth in stages. In this case, there are three evident transitions as the months and years roll on. A company begins with the product it wants to sell, and then starts to sell it. But selling alone isn’t enough for a company to reach its full potential—there is another important stage.
When somebody first starts a company, they're totally invested in the product or service they’ll be selling. They become operationally focused to make sure that product is the best out there. And that's smart. If they don't have a competitive product or service then they're going to always suffer as a business, and they probably aren’t going to last long enough to see any more stages of development.
Once they've got a good product and have some initial success, things kind of plateau from a growth perspective. And that’s when they say, "You know what? We have to get some salespeople in here and sell this thing!" From that moment forward, their company becomes sales-focused.
To grow revenue, naturally at this point the company hires salespeople and starts having success as it professionalizes how they sell the product in the market. The company has people out in front of potential customers, informing the audience of the benefits of a product. Ultimately this results in sales and revenue growth.
But once the salespeople have exhausted their network, and have cold-called all the people they can, the company begins to plateau again from a revenue growth perspective. And when that occurs, management usually hires more salespeople, but they quickly find that approach does not scale. Want to triple your revenue? Try tripling your salesforce. Doesn’t work, does it?
Companies that continue to grow once they have a good product and a mature sales function almost always go on to stage 3 and become marketing focused.
To really leverage sales, a company must market its product. Whenever this happens, a company can really expand its organization because it’s going to make life easier for its salespeople. They will be more successful on a call because the customer has heard of the company, they've heard of the product being sold, and they understand the benefits before the salesperson even enters the office.
A good salesperson has no qualms about approaching even the toughest potential customer. They like the challenge. Marketing, on the other hand, likes softer targets. Its first step is to define the very best prospects: Budgets can’t be wasted on those who are never going to convert to a good customer.
Some research can help define the best market segments and help focus sales. Once the very best audience has been determined, things will run more smoothly with concentrated sales efforts. Start marketing to the right people and you’ll find you’re reaching a much more receptive audience, and that leads to higher win rates and a more efficient salesforce.
Every company has the same issue: 20% of the sales force is creating 80% of the results (and sometimes it’s worse than that). This means that there are star salespeople and then there are others who obviously could use a little help. So what can help them be more successful—something that’s self-enabling and going to support them in telling the company story much more clearly?
With good marketing material, salespeople will be more effective. Sales teams turn those prospects into sales much more quickly because a.) They’ve targeted the right people and b.) They have the right sales collateral that shows the clear value of the offering.
Done right, marketing will help companies see a massive spike in growth. And from that point on, a company should evolve to develop greater brand awareness, which can help companies scale their efforts when they enter new geographies, develop new products to address emerging client needs, and find new customers for existing products.
Yes, marketing can help the organization realize those opportunities. But if it doesn’t market itself, none of this development will happen. A company will only get so far barking up the same trees and not expanding its options—and it’s not going to have the kind of success it deserves.
If marketing is not part of your organization’s plan, you're only going to be able to sell so much product. You’ll hit that growth plateau or worse, start losing market share because your competitors are out-marketing you. To continuously mature as a company, you’ll need to take a serious look at strategic marketing. It’s never too late to begin, and I can help you take a pragmatic view of growing your organization.
Positioning outlines why your product is unique in comparison to market alternatives, and messaging describes to your target segments what you’ll do to deliver on the promises made in your positioning statement. It is a powerful one-two punch, and you need to be able to communicate yours before you start spending money on tactics.
Properly understood, the job of a marketing department is to drive revenue for the company. Some marketers do so by building and maintaining a brand, others focus on generating new leads, and others still focus on enabling sales to close more quickly and consistently. A good company with a mature marketing department does all of these things, even if they focus on some areas more than others. But there’s one area of revenue generation where the marketing department is often relegated to a passive participant or even outright excluded: pricing.
Companies everywhere are looking to cut overhead and other costs to keep up with a changing market and an economic recession. That usually means that marketing budgets are the next to go. Much like during the pandemic, businesses will have to pivot and discover new marketing solutions to combat the economic recession, inflation, and other market changes.
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