Jason Kanigan answered:
Yay, a question with some details!
So the first thing I'd like you to think about is that despite "little business success" this business has somehow limped along for 4 years. How did that happen? Just enough cash coming in to get by? Loans? You need to find out how deep of a hole you're in, if any. That amount will have to go into your revenue target.
You need a revenue target. Perhaps you didn't mention it here because you want to keep it private. But you need that number. It has to cover all the salaries, infrastructure, marketing, taxes, and profit. Yes, profit! That has to go in there or you'll never get it.
If your goal is "as much money as I can get," you'll never get that, either. That target is a fool's errand. Set a specific target; achieve it, then raise it.
You really want to get a handle on your money equation. Once you've got that stable, then you can increase the flow.
From what you've shared it sounds like the odd lead comes in, you clamp down on it, and close one here and there.
You need consistency.
Here's the money equation to get that consistency:
Unqualified Leads >> Qualified Leads >> Sales.
We build this backwards, from the revenue you want. And I will share with you that the number one problem my clients uncover from this exercise is that they were beaten before they began: and they didn't even know it. They did not have enough leads coming in, nowhere near, to have a chance of hitting their revenue target.
So you take your revenue target and divide that by the average $ value of a sale. You can do this in a more fancy way if you like, forecasting by service type. But for now let's keep the ideas straightforward.
So you want $1M in revenue, your average sale is worth $100K: you know you need 10 sales to hit that money target.
What we're doing is building back into an ACTIVITY LEVEL, so you know what you need to be doing every day to get there. This is what you measure your staff by. Without knowing this activity level, you'll do a little here and a little there but no consistent effort. It'll be "as much as I can" and as we've seen that's no target at all.
So from your own experience as a decent closer you know your numbers. How many qualified leads (people who have need, budget, and personality fit to work with you) have you had to speak with to get one sale?
Let's say the salesperson is OK but not amazing, and neither is the marketing (yet!). They can close 20% of qualified prospects, so that's 1 in 5. Simple math takes us from 10 sales X 5 = 50 qualified prospects.
Over a year, that's more than 4 per month. Let's say, to ensure results, we make the target 5. So now you know: if your salespeople aren't getting 5 conversations with qualified leads every month, you're not going to make that money target.
Now we know that for every good lead, there are a bunch of bad ones to weed through. These are attracted by your marketing--trade publication ads, SEO to website, YouTube videos to website, white papers, Kindle reports, paid advertising, whatever method of connecting with your target market you can come up with. Each will have its own quality level. The ratio of Unqualified Leads to Qualified Leads will be different. But you can build your funnel from the activity and quality levels of each lead source.
Let's say for simplicity you're going to concentrate on only one. You have a trade pub ad for a free white paper on your topic, and in exchange the prospect has to provide their name, email address, and phone number.
At first you estimate; after awhile, you'll have real data to put into your money equation.
To begin with let's say the lead source isn't great but it isn't awful, either. It takes 15 leads coming in to get one good one. (A quick aside to explain further about how this could work: the white paper links to a YouTube video series which continue the qualification process; then they're invited to get on a group education call or webinar; from there those who know they're ready book a call with the salesperson.)
So 50 qualified leads X 15 = 750 unqualified leads over the year(!) that you need to be bringing in under this example.
That's basically 63 per month or 13 every working day. If your funnel has been producing a trickle of say 2 leads a working day (and I suspect even that would be high for you right now), can you see how you've been beaten before starting? How you had no chance of making enough money, no matter how vaguely the target may have been defined?
This is your activity level. Once you've done this simple calculation, you know you need to build to those 13 leads coming in every day. How will you do it? What sources do you need to hook up to?
Unqualified Leads >> Qualified Leads >> Sales.
750 >> 50 >> 10 (in this example. Every instance is different.)
U >> Q is Traffic. Traffic quantity and traffic quality. How good is that lead source?
Q >> S is Conversion. How good is your sales letter, VSL, salesperson?
When you run your actual performance numbers against the planned estimates, you find out what to work on. Traffic? or Conversion?
Remember, what other people are doing is measuring Leads >> Sales. Just those two elements. That's the equivalent of throwing something against the wall and hoping something sticks. They can't diagnose. They make all kinds of attempts to fix problems, but they can't see what they're doing and even if they do succeed, they don't know why so they can't repeat or duplicate the effort.
So with that simple system in mind, the money equation, my answer to your question is:
Don't go out there and blindly hire three guys to do some jobs. If they support your money equation, you know how they'll either get you leads coming in, qualify them, or convert them into sales, then yes. And you make those targets obvious to them. Not "as much as you can."
One final note about speed. I call this the speedometer because with the money equation you see how fast you need to move to hit your money target. What if you discover there's no way you can pump enough leads through the system in time? Say you have a $50 product and you want that $1M. You're going to need 20,000 sales to hit that revenue target, aren't you? That's over 1600 sales every month. You may look at that and exclaim to yourself, "No way. We don't have the distribution channel to do that right now and I don't know how to buy into one yet." That tells you right away you shouldn't do this: you need to come up with a different way of making the money that matches the speed you can run at.
When it's just you doing the closing, you have only so many hours in the day. I would concentrate on making your marketing incredibly effective at attracting, qualifying, and pre-selling prospects so that when they get on the phone with you they're ready to buy. If you try and tackle the whole job by yourself on the phone, it's too late. It'll take too long.
In your question details, which again I thank you for providing and lead to me writing this detailed answer, I don't see a "strategy." I see "let me put some mechanical concepts to work" (a machine to try and generate some leads by conversations, a machine to try and intercept interested readers with content, and a machine to try and generate leads by organic internet traffic). But no cohesive spine behind them. No "this is how they'll work together."
SEO can take a long time to work. Content needs to be in the right place for your target market to see it--you can churn out legitimately great content but if nobody sees it, what's it worth? And outbound prospecting often hits the wall with big companies (it's happened to me in the past year--voice mail hell with companies of 1000 people or more...computer-voiced auto attendants, no chance of live interaction...full VM boxes so you can't leave a message...no phone sales technique can work if you don't get another human being on the line). So you need a strategy behind activities, which maybe you do have but just haven't written down here because you want to keep it private.
If you want my help in developing that strategy, you know where to find me. ;-)
8 answers
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about 7 years
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