The backdrop of the pandemic may have halted business confidence in the economy, but as the green shoots of recovery start to appear, there’s never been a better time to grow your business.
The big question then comes up, if you want to double or triple your revenue in 2021, how would you do it?
Well, revenue growth isn’t random, it can be systemised. There’s lots of advise out there, some awesome, some not so awesome. It’s impossible to cover everything in one post. But I’ve tried to provide a high level overview of the different building blocks that you should consider as you look to scale your revenue based on my own background in building and scaling fast growth fintech solutions.
Before we get into the nitty gritty, what’s important to clarify is the market size that you’re going after, outline your forecast sales over the next 12 months and how much that you’re willing to spend on marketing to achieve those results.
The top down approach would see you forecast your revenue projections based on the market share. Whereas the bottom up approach would see you start with estimates of revenues that you could achieve based on a clear ‘Go To Market’ strategy, with clearly defined channels of distribution with known volumes of leads that you’re able to generate.
These data points should then be baked into 3 key artefacts that you’ll financially run your business on: P&L, Balance Sheet and Cash Flow statement. More on these in a future post.
Once you’ve got a clear understanding of what your projected revenue target is, you need to re-engineer this high level number into a clear pipeline breakdown so that you have a clear understanding of what volume of leads you’ll require to achieve that revenue goal.
You’ll need a clear pipeline that’s broken down into distinct stages to track the customer journey and then to optimise over time e.g. Marketing Qualified Lead (MQL’s), Sales Qualified Lead (SQL’s), contacted, offer, lead closed successfully or unsuccessfully.
Remember, the best way to double or triple your revenue isn’t by doubling or tripling your sales team but by growing your volume of qualified leads, as well as optimising and automating every step of journey.
The main thing in pipeline management is to concentrate on a clear understanding of what are the metrics of success that you need to track, such as: Average deal size, percentage of deals that have moved from one state in the pipeline to the next, what percentage of deals have moved from stage to stage until they’re closed out etc etc
Just having a website with a great product isn’t enough. You should be considering your web based traffic building strategy from day 1.
At Cape, we split up our lead generation into ‘paid’ and ‘earnt’ buckets:
Paid - SEM, Pay Per Click, Pay Per Lead, billboards, radio, TV etc.
Earnt - SEO/Organic, Social Media, Word of Mouth, CRM lead nurturing, events, webinars etc.
It goes without saying, you want to be focusing on paying nothing for your customer acquisition, whilst also finding a way to have high engagement with them.
Generally speaking, your paid engine for growth can be like turning on a tap for leads. That being said, before actively engaging in any form of PPC, be sure to set aside a clear budget and Cost Per Acquisition (CPA) target that you’re aiming for.
Also be mindful that every lead channel and source will have varying conversion rates. Be sure to bake this into your financial modelling work when coming to a ‘Customer Acquisition Cost’ that you’re comfortable with.
Look to split leads into 3 types: Seeds, nets and spears. This was something that was popularised by Aaron Ross, highly recommend his books and work if you get time to check it out.
Seeds are predominantly Word of Mouth (WoM) leads from prior relationships and happy customers. Cant proactively grow these but can be fast to close a deal.
Nets are marketing leads, events, webinars, white papers, advertising etc. It’s all about casting a wide net and is very much a quantity over quality game. Easy to generate.
Spears –typically these come from sales and BD folk reaching out to specific targets, lists and companies. Goal is quality over quantity. This is most likely a team that manages accounts or responds to inbound leads.
Hurray! You’ve generated some site traffic. But, erm, that’s not where the journey stops for you my friend as you’ll need to crack on with optimising website traffic.
It’s important to remember that it's not just about the eyeballs you attract, it’s about the kind of eyeballs you collect, how you slice, dice and direct them through your buying journey. For that reason, once a visitor lands on your site, be sure to track on page conversion and how customers move from one page to the next. There’s a number of tools that I’ve used in the past from Hotjar, Mixpanel, Optimizely to Fullstory that are all fantastic and worth exploring.
Testing messaging and Call To Actions (CTA’s) is essential. You need to understand what emails have been opened or the view rate, which can be indicative to show the strength of the subject line.
Otherwise, we look at: Click through rates to understand the strength of the CTA in the email and the response rates to show the strength of the actual messaging.
At Cape for example, our starting benchmark for open rates is between 30-50%, click through rates of 20-35% and general response rates of 15-30%.
One other thing to consider is to look at when you’re sending out your campaigns. Data typically shows that either Tuesday or Wednesday at 9am or 3 or 6pm on the same days are in fact the most effective.
You’ll need to pick a number of touch points per lead and decide how to contact them. There’s various reports out there that highlight the optimal number of touch points to reach out to a customer either via text, instant messenger, phone, email or carrier pigeon. 6-8 touchpoints of contact over a 3 week period is one such suggestion from Salesforce, which they then advise you to move the lead onto a ‘Nurturing Queue’ for follow up on at a later date.
Just because you closed off an old lead, doesn’t mean that the customer has necessarily given up on purchasing your product. Be sure to stay at the front of mind, without over communicating to your customers, so that when they’re ready to pick back up the buying journey, you’re the first port of call.
Creating a ‘viral expansion loop’ by building virality into the functionality of your product is a great way to generate free leads from site visitors and existing customers.
When looking to create organic referrals from others, consider the best time to capture a referral is just as a lead has successfully closed. If for example you’re a ecommerce business, can you look to offer free credit on a future purchase to your customer if they then refer you to a friend?
Finally, you’ll need to build out your technology sales stack to help with everything from lead generation, management, nurturing and optimisation. This will consist of: scraping lists, data enrichment tools, outbound email campaign software, CRM, marketing automation etc.
You can’t survive on cash alone, as what you need to achieve is a positive cashflow position, with strong cashflow management processes in place.
Predictable lead generation is the one lever you can pull to help your company achieve greater top line revenue growth.
Good luck and god speed.