Over the weekend, I was thinking about ways to grow some of our client’s businesses. It occurred to me that, despite all the effort we put into sales methodologies and marketing campaigns, our ability to grow our client’s businesses comes down to 3 simple things.
The fact that the success or failure of our efforts all came down to 3 simple things surprised me.
After all, if your business is like mine, you put a lot of effort into building sales models, tracking data, analyzing the information, and working day and night to improve your results.
But when it all comes down to it, there are actually only 3 things you can do to grow your business organically. I’ve outlined them in the image below.
What’s interesting about all this is that most businesses spend about 99% of their time worrying about #1 and #3. They spend very little time thinking about the second option — which is to increase the speed at which a lead converts into a customer.
But as you’ll see below, if you can increase the speed at which a lead moves through your sales funnel by 30%, it can have a 50% impact on your bottom line. Don’t believe me? Keep reading.
But first, understand this — it’s time to throw away the traditional sales funnel and replace it with something better.
The traditional sales funnel was invented by William Townsend in 1924. If you worked in the B2B world, it looked something like this:
For most of the 20th century and some of the 21st century, the sales funnel concept worked fine. In the example above, a prospect would go to a trade show, be given a brochure, talk to a sales person, and then (hopefully) ask for a proposal.
It was surprisingly simple.
Today’s prospect journey is much more nuanced and complex.
You’ll notice in the image below that there are many more touch points on the way from being a prospect to being a customer. The result is that things can get pretty complex pretty quickly.
You should also notice that even with this complexity, the process still involves nurturing people through the top, then the middle, then the bottom of the funnel as seen in the image below.
Prospect A in the image below is engaging with a lot of touch points along the way to becoming a customer. This complex journey is more like a matrix than it is a funnel.
You’ll notice that Prospect A in the image above takes longer to move through the matrix than Prospect B does in the image below. If you could get more prospects to take a quicker path like the one Prospect B took, you would deliver more leads to your sales force, ideally for the same amount of money.
The matrices above do a better job of describing the customer journey than traditional sales funnels do, which is why we’re developing a product around it called the SalesMatrix™.
The SalesMatrix™ involves highly sophisticated tagging of prospects as they engage with an online display ad, a mobile display ad, a YouTube video, a native ad or any of the other formats that we tag and track.
But that’s just the beginning. We also track their journey through the middle part of the funnel — blog post visits, webinar visits, e-newsletter subscriptions, white paper downloads, etc.
By micro-optimizing each of the touch points along the way, we can improve the results on a macro level. In other words, by tagging, tracking, analyzing and optimizing, we’re able to increase the speed at which a prospect moves through the funnel.
It’s very complex and requires a lot of sophisticated technology. It’s also not inexpensive. But if you’re spending $1 million each year on your sales and marketing efforts and we increase the effectiveness of your campaign by 20%, we’ve effectively delivered $200,000 to your bottom line, which more than pays for what we do.
Here’s an example of how a business can use our technology to increase the speed at which a prospect moves through the matrix.
- Let’s say you live in the B2B world
- Let’s also say you close 2 new accounts every 3 months
- Each new account represents $30,000 a year in revenue to your business
- 2 new accounts every 3 months equals 8 new accounts each year, which on an annualized basis, will generate $240,000 in income for your business
- Winning 2 new accounts every 3 months is fine, but what if you could shorten the journey from prospect to customer?
- If you use the SalesMatrix™ to improve the speed at which a lead turns into a customer by 30%, then you generate 2 new accounts every 2 months (instead of 2 new accounts every 3 months)
- By doing so, you now bring in 12 new accounts each year, which is a 50% increase over the 8 new accounts you were bringing in before
- In other words, a 30% improvement in the speed through the sales funnel equals a 50% improvement in revenues!
This is important, ground-breaking stuff, so I wanted to provide you some action steps and a recap for you.
Action steps for you.
We’ve covered a lot of ground here, so let’s do a quick recap:
- The Sales Funnel is Outdated: The sales funnel is a model that’s been around for nearly 100 years. It’s time to put it to bed.
- The SalesMatrix™ Replaces the Sales Funnel: Instead of tracking leads by hand, our technology can tag, track, analyze and optimize the prospect’s journey digitally, which gives you the ability to micro-optimize each element of the campaign.
- Micro-Optimization Equals Macro Results: By constantly optimizing each element of the funnel, we’re able to generate a big impact on your bottom line. It’s complex, and it’s a lot of hard work, but in most cases it pays for itself.
Does all this make sense? Would you like to hear more about it? If so, send me an email and I can walk you through how it works and how we can apply it to your business.
About the Author: Jamie Turner is an internationally-recognized author, speaker, and CEO. You’ll find him on the 60 Second Marketer and as an expert commentator on network TV. He is also the founder of SIXTY, a marketing consultancy and advisory firm that helps clients get more bang for their marketing buck.