The year is already half over, and many B2B leadership teams will have an eye on the numbers: Are we reaching (or exceeding) our quotas? Are we on track for hitting our annual goals? Are we losing, stagnant or growing?
But 2023 has not been an easy year on B2B organizations. A number of market situations — from high inflation to continuing supply chain issues and more — have tightened buyer budgets and slowed deal flow. The current state of the market is not showing much improvement either.
Business leaders love market upswings, dislike downswings and absolutely fear uncertainty. As I speak with executive team members across a cadre of companies (all sizes and industry verticals), uncertainty dominates each conversation.
If the market is clearly in a downswing, executives can make necessary expense cuts while also making well-calculated investments that offer a competitive advantage and / or faster ramp once the economic climate pivots. But when there is uncertainty, even the savviest business leaders can succumb to the freeze of indecision — for in uncertain times it is too easy to “wait until next week” when the picture may be less cloudy.
THE POWER OF A SUSTAINABLE REVENUE PERFORMANCE — VERSUS GROWTH — MINDSET
Growth sounds good. It has a nice ring to it — more buyers and more profits. Yet a “growth approach” works in limited situations. And it often ends in failure. At Mereo, we focus on sustainable revenue performance.
A focus on revenue performance versus growth helps you ride out market shifts more strongly. Focusing on revenue growth alone can lead your executives to risky decisions. Risky decisions can wind-up bust in times of market disruption or uncertainty. With an eye to sustainable revenue performance over a longer period of time, your leadership team’s mindset shifts. You build an engine that you can depend on in good times and bad.
A revenue performance emphasis focuses not only on top-line growth but also the broader metrics including profitability, deal velocity, client acquisition costs (CAC), sales yield, client lifetime value, win-rates, average order size and more. These offer a broader perspective for managing both in growth climates and other less favorable conditions as well.
Organizations with sustainable revenue performance command more pricing power. Selling organizations focused on growth alone will be desperate for more sales. They want to see salespeople’s quotas go through the roof. They need more deals closing to keep reaching higher numbers. They want more, more, more. And often, to get there, salespeople will be quick to discount — which is a dangerous practice to the worth of your solution and your long-term revenue performance.
Selling teams focused on sustainable revenue performance still have the motivation to close sales. But they will stand by the value of their solution and the supporting differentiated value proposition. They will earn your organization the revenue it deserves to keep serving buyers for the long haul. As such, they are not worried about making a hundred sales but just one. They can wait for that one. And your company will be in a better position to keep commanding pricing power into the future, no matter the market situation.
GET THE LEADING PRACTICE GUIDE TO PRICING STRATEGY!
SEEK TO SERVE™ — AND THE SUSTAINABLE REVENUE PERFORMANCE WILL FOLLOW
The fascinating reality is that by focusing on supporting sustainable revenue performance, your organization will ultimately grow over time. You will survive the storms of market disruption and hold fast in times of uncertainty — and grow consistently for long-term rewards.
If you Seek to Serve, Not to Sell®, your sales force will build long-term buyer relationships grounded in value-exchange that will help you achieve sustainable revenue performance. Learn more about this selling approach and culture.