Historically, a great time for economic growth and expansion follows a recession. The team at Mereo decided to put the numbers to the test to see if successful companies around the world were recovering and experiencing this expected growth, and if not, why?
What we found was shocking and unexpected.
It is safe to say that there is strong evidence that companies are experiencing stagnation in revenue growth, both recently and since the bottom of the last recession.
Traditionally companies are successful when they meet two goals: build revenue and increase earnings. We wanted to take a closer look to see if some of the biggest domestic and international companies current approaches to sales, and their go-to-market approach, was working to meet BOTH of these goals after the recession.
We took a sampling from some of the most successful companies in the world: the Fortune 500, the Russell 2000 and the Fortune Global 500 and tested whether they had experienced consistent revenue and earnings growth over the last 6 years.
Our analysis revealed that from 2012-2013 OVER 30% OF THE FORTUNE 500 COMPANIES HAD ACTUALLY SHRUNK (declining revenue). We then took a look at a 5-year span from 2009 to 2013, and this data was consistent with the most recent year findings: 48% of the United States largest companies had less than 5% average growth over this 5-year span that should have represented economic expansion.
The fact that almost half of the nation’s largest companies have almost no revenue growth over 5 years may be indicative of a broader issue on the general approaches being employed in their go-to-market plans.
Our analysis of the Russell 2000 and the Fortune Global 500 proved similar stagnant and declining trends.
In our experience with working with companies around the world, we often see sales teams too focused on one thing, and one thing alone: selling. Although this seems like an obvious focus, selling alone doesn’t typically create a platform for continued revenue expansion.
Companies experiencing stagnating or declining revenues are often focused on selling to customers as opposed to SERVING them. The impersonal sales techniques associated with transactional processes do not develop long-term relationships. When the focus is on selling, opportunities to provide true value and solve customer’s pains are missed. Successful companies focus on building a relationship with each of their customers, creating the desire for the customer to return to the same company and purchase more of their products because of the VALUE and SOLUTIONS they receive from the sales person.
It seems many of the largest companies in the world are stuck at a stand-still, unable to achieve the growth the recovering economy should be providing. A new SERVING approach to sales would dramatically help many of these companies meet their crucial goals of building revenue and increasing earnings.
Over the last eight years, Mereo’s clients have proven that focusing on relationship-based sales cycles allows the sales representatives to build credibility with their customers, enabling new, recurring revenue streams for future sales, and also allows the representative to leverage successes through references.
Our motto has always been, and will always be: Seek to serve, not to sell™. When we see sales teams leverage this method, success always follows. If companies begin to serve their customers first, they may be able to deviate from the current, poor revenue performance trends we have seen over the past six years.
Download our full report to see the declining trends mentioned above.