Over time, the world has always experienced ad hoc recession periods due to political, economical, social and cultural instabilities, such as world wars, the Wall Street Crash of 1929, embargoes, Brexit, drop of crude oil prices, civil wars, nuclear cold wars etc. Indeed, these fluctuating periods severely burdening the economy, have been in one way or another responsible for the lower income growth affecting countries, leading to the reduction of purchasing power of populations (potential buyers) and their spending. Therefore, in a context of slow recession recovery, capitalism has been undertaken worldwide as a means to overcome intermittent economic crises. However, capitalism being related to permanent revenue/benefits’ improvements, the savvy and implementation of efficient and effective strategies (marketing development) to streamline the future revenue growth seem to be necessary.
Before getting to the heart of matter, it is necessary to differentiate between some basic terms. Although, the words sales and revenues are totally different, they are complementary to each other in the sense that they may lead to an income or a loss. Indeed, understanding how both are related and how to balance your need to increase them, helps you in marketing efficiently and optimizing your benefits.
- “Sales” refers to the total number of units of product that you sell.
- “Revenue” is the total amount of money obtained from your sales.
- Income means profits obtained from sales
Key factors required to increase sales revenue
As a head of sales, it is always a permanent obsession to find the “big thing” that will bring the company to the next level. Though increase sales teams, making new logos, new marketing campaigns, etc, seem to be a good approach, there are key considerations or factors that have to be taken into account before in order to whack the top of sales. Moreover, in order to boost sales and increase revenues, marketing and sales departments need to work in a complementary way since they share a common objective, i.e. the rise of sales revenue (customer responsiveness). Hence, their converging actions (marketing/sales strategy) must involve four basic areas substantially influencing customer feedback towards the sales increase. The critical factors or parameters required for sales increase are defined as follows:
Everything starts with a clear sales strategy which is an overview of the market weaknesses, an adaptation and anticipation of new social needs. At this level, you should have an introspective view of your previous strategy, examine your weaknesses and develop a new strategy that aligns with your revenue objectives, involving the resolutions from the past strategies fails. A well thought strategy is at the core of increasing sales and requires specific answers to “self-questioning” as follows:
- What were your previous year strategy and weaknesses?
- Where did you notice areas to exploit?
- What market opportunities or weaknesses presenting themselves are you going to seize?
- In which areas are your competing rivals failing?
- Which rivals are you going to take out of game?
- How do the market dynamics behave?
Ultimately, a good strategy requires a deep look inside and outside of the firm for opportunities in order to be set.
Structure is the framework holding up strategy. It is the core for strategy execution, making sure you have the right pieces in place, hence the need to have a solid structure. The most important thing here is to make sure that your structure supports your strategic plans. The common questions that you need to answer in order to build a solid structure are the following:
- What does your strategy need to be successful?
- Does your strategy involve inside or outside sales?
- Does it need alternative compensation plans?
- Does it require new areas?
Besides, structure involves sales enablement and sales operations
It is the most important key component to drive revenue, but unfortunately the most forgotten. Many organizations most often face this problem. It is well known that whatever the domain or activities you undertake, it is undeniably requisite to have the right people in the right positions; otherwise your business will fail. People are the core to execution in such a way that if this critical parameter is not respected, the marketing strategy will not succeed. So after taking a look at your team strive to answer the following questions:
- Do you know the skills required to be successful in each role in your organization?
- Do people well suit their positions?
- Have you established the main skills and traits required by your team to crush it?
- Have you measured each member of the team against skills and traits?
- Do they have the required skills to boost sales?
- Do they have the marketing savvy required for sales increase?
- Does your team perform at the threshold required to be successful?
- Can you testify your conclusions?
The “people” parameter is the most difficult to get right because people are unpredictable. Making sure that this parameter is successfully achieved is at the heart of increasing sales revenue. It is necessary to have the right people in the right roles so that they align with the strategy, while being motivated to get things well done.
This factor is comparable to blood vessels providing oxygen to the heart. “Process” makes sure that everything is running at the right pace and efficiency, avoiding wasting time and effort killer. Poor process impedes marketing time and execution, making things to slow down. Indeed, when processes are not working, it restricts the chance or the ability to achieve the objectives. Hence, it is crucial to look at your processes and assess them using the following questions:
- Do your processes enhance the selling process or crush it?
- How does your selling process look like?
- Does it accelerate the sales?
- What is team development process about?
- What is your coaching process?
- What is your win/loss assessment process?
- What is your hiring process?
It is important to make sure that your processes improve your teams’ ability to boost sales in accordance with sales strategy, structure and empowered people.
Growing revenue must be a targeted, specific and aligned set of goals across the four key factors, i.e. strategy, structure, people and process. If a sales company is not delivering as expected, the problem will be found in any of these factors. Well set strategy, structure supporting the strategy, right people in right positions and right processes put in place, will guarantee a sales increase, hence a leap in profits. Moreover, it is crucial to understand that the four key factors mostly involve a self-questioning whose answers must be in accordance with your new objectives (boost sales). Thus, these factors must be considered as a “skeleton”, a planning for action, around which you should build or apply practical recommendations and effective measures in order to increase sales revenue.
Effective strategies to increase sales revenue
The poor economy of previous years has seriously affected small businesses. Success in business requires sales sufficient enough to generate profits. However, this is easier said than done. In order to boost sales and increase sales revenue, a marketing strategy, coupled with a sales strategy must be put in place. Your decision to implement these strategies should be based upon the four factors mentioned above. The practical and effective strategies required to increase sales revenue can be expressed as follows:
Constant training and assessment are necessary in all parameters of your business plan. This mostly involves the upgrade of “people” factor and can be done through:
- Institution of an effective sales training program
It is crucial to sharpen your sales force’s abilities and permanently improve their sales skills and provide knowledge to meet the change in demands. Without a suitable training, sales performance will lag and you will neither be able to maximize your sales increase, nor your sales revenue growth.
- Assessment of sales compensation programs
The compensation programs are directly linked to performance but not all programs are equally effective. Interestingly, a holistic approach to motivate compensation seems to be the most effective way to drive overall business sales increase.
- Assessment of member of sales team
It is important to assess the performance of your staff to see whether you need to train them or replace them by sales professionals.
In marketing, it is important to avoid being monotonous and confined especially when you wish to increase sales. Expanding the market is a great approach and can be proceeded by:
- Adding complementary services to existing products
Adding complementary products or services may help you gain new customers, as well as maintain existing ones. A mature company needs to add new products and services to create substantial growth. Whenever you think that you have saturated the marketplace, determine the products your target clients purchase that you are not selling and that you make and market at your advantage. You may need to replace old products with new ones and lead to a drop in sales, but higher income if the substituting product is highly priced.
- Extending the geographic area of the market
Many small businesses constrain their marketing and sales approaches to the immediate areas surrounding the central location of their business. For instance, a distributor of a product discovered that none of his competitors marketed in areas surrounding the town, certainly because no supplier was located within those localities. The additional cost to cover the larger market was minimal and more than doubled potential sales. Hence, you should not assume another market is being served without carrying out any investigation.
- Being involved into corporative sales agreement
The secret to assure and insure a permanent sales increase is undeniably to contact companies selling a complementary product or service with a request to sell your products as well. For instance, computer hardware companies often sell software, thus facilitating the sale of their hardware. Many companies actively look for complementary products as they add very little to marketing and sales expenses. Finding the right partner is what really matters. Adding supplementary sales people at no cost is a good sales strategy.
- Couple inbound without bound marketing strategy
The reality in the world today is that people are more and more willing to look for the products they need via quick online research. So it is important to be well positioned as authoritative and client-centric. Inbound marketing must be an alternative approach to diversifying your marketing impact; it should be associated withoutbound marketing in the sales strategy to boost sales.
- Sharpen your pricing strategy
Price is the single most important factor influencing a decision to purchase or not a product or service. Before implementing any pricing strategy, know what value the potential consumers may ascribe to your product because a lower price may look like a low quality product or a bargain. You must always consider your prices as “temporary” and adjust them with time to meet the market and competitive circumstances. Indeed, honing a good pricing strategy is a good custom-focused sales strategy. It involves special advantages towards your clients by creating a strong relationship between salesperson and the customers. It is an essential tactic for customers’ loyalty. This approach involves:
- Cross-sell and up-sell
Cross-selling is the activity of selling a different product to a customer who is already buying a product from the same company. Up-selling is the act of trying to convince a customer who is already buying to buy more, or to buy something more expensive. These two sale techniques are very easy when it comes to online commerce. Indeed, if someone purchases a product, you can send them an invoice or receipt listing some relevant related products. For instance, if someone always buy a load of fertilizer, you may suggest them grass seed, insecticide or flower pots as well.
- Offer special discounts
In a proper marketing strategy, discounts create special purchasing opportunities in consumers’ minds, often encouraging them to take action. The discounts can be applied either to limited products, such as like school supplies or to products getting close to expiration date.
In fact, you can choose to apply a single sale discount or many types such as:
- Seasonal Discount: When products are purchased within a specific time-frame,
- Conditional Discount: When the products bought are used or reconditioned,
- Quantity Discount: selling two or more of the same item are purchased at the same time,
- Tie-In Discount ( referred to as “Bundling”): When two or more different products are bought at the same time,
- Stripped Discount: When the products bought are “stripped” of one or more features.
- Raise or lower products prices
In marketing, most of the time, the prices of products change, so you should not be reluctant to adjust your prices to meet your goals and adapt to the market situation. An immediate price increase will lead to additional revenues and benefits to the company if and only if the price raise doesn’t negatively impact on sales. A price lowering will spur more sales and take market share away from other supplying companies. Hence, know how your products compare with similar products from the point of view of buyers, as well as the prices of rival products, will allow you to better position your products prices in the market place.
Furthermore, changing prices may involve a great move so you should be particularly sensitive to the feedback of your customers and prospects as the new prices go into effect. If the responsiveness is not positive, further adjustments can be made, including a return to the previous prices.
Besides, you may also consider regularly raising your prices. Customers rarely react to slight price raises and often overlook them. Though a small increase in price may not look significant when compared to the whole price, the impact of the increase on income is magnified since it is function of the units of product sold by the company.
- Reduce, add, eliminate handling and shipping charges
Instead of raising the price of a product, consider adding postage and packing (shipping and handling) charges. Though the net effect on revenues is the same, it avoids buyer backlash to a price raise. If you currently charge for postage and packing, you may consider reducing or eliminating the charge for a specific time frame. This is a marketing strategy to boost sales.
- Bundle complementary products
A very good sales strategy to increase sales revenue is to bundle complementary products. Indeed, selling as a package, products naturally going together, or used for the same task or at the same time is a great approach to achieve your objectives. For instance, a store may bundle girls’ shoes, handbag and dresses together for a price much lower than if the products were bought separately.
Invigorate your sales channel
You have to generate enthusiasm and reasons to purchase in a view to increasing sales revenue. To renew the excitement for your products and reenergize your sales strategy, these are tips to follow:
- Institute a layaway system
A layaway program is a system of paying for goods or products in small amounts and receiving the products when the full amount has been paid. It is an alternate form of offering credit to customers. It allows your customers to pay on time without you having to incur any financial risk. Layaway was a very common sales strategy before the widespread growth of credit cards. Moreover as a seller or provider, your one concern with the implementation of this system is to be sure that the layaway product is not unique or perishable; otherwise it might limit the number of new purchasers if the original buyer reneges on his purchase.
- Re-energize your sales collateral
It is necessary in your marketing strategy to attract attention through sales collateral, i.e. brochures, pictures, presentations, product data sheets; etc. Although the only aim of the collateral is to make the sales effort efficient and more effective, their importance is often overlooked by business owners. As a result, the information presented to potential buyers becomes obsolete and unsuitable. Websites frequently observe the same malaise.
Your sales collateral and your website, is a reflection of your firm. A vibrant, bright-colored document complete with drawings and pictures retains attention and generates enthusiasm in its content, whereas dull materials are usually thrown away without a second thought.
Review your sales materials, one after another, to see whether they suit the image and message you want to present to your customers:
If your brochures, product data sheets, pictures, presentation or website don’t simply and clearly present information which will spur your prospects to take action, it’s time for redesigning.
- Take credit card
In developed and developing countries, credit cards are more and more implemented as a secure means of facilitating payment. Therefore, accepting credit cards for payment is a benefit to your potential clients and is a proven method to quickly encourage sales. If you do not currently accept credit cards, go to your bank and create an account immediately. The initial costs of setup will be easily recovered, and the processing fee can be considered in your retail price.
- Incentivize your sales partners
Review your commission structure to boost the sales force. Most commission schedules are organized in tiers where the sales person receives a lower commission rate as his sales raise. If you’re using that approach, it is advisable to change it by making the higher commissions applicable to the greater number of sales. In fact, the promise of an even greater income as sales increase is a powerful incentive for competitiveness in between your staff, thus making more sales. Besides, for a temporary boost in sales revenues, you may create a sales contest where the sales people compete for a reward, cash prize, or a luxurious trip if they reach a targeted level of sales. If successful, initiate one contest after another with a different reward each time.
In this growing world, increase sales revenue remains the main concern and a great challenge in business. Indeed, it is well known that a business may either generate a profit or loss in which case the consequence may be disastrous and implying a collective dismissal. Besides, it is crucial to build your practical strategies around the four basic factors (strategy-structure-people-process). These strategies require the settlement of your objectives (increase sales revenue) and the identification of your former weaknesses before the implementation of a well planned framework. An observation of successful companies show a constant reinvention by listening to their customers and adapting their products to meet the constantly changing market’s need. Thus, effective and efficient strategies to increase sales revenue must be customer-focused.