Wednesday, October 22, 2008

Agility is Key in a Down Market

Weathering an economic downturn won't be accomplished by a "business as usual" attitude. You will need to be quicker to respond to the market, and will need to take advantage of the full arsenal of Web 2.0 tools (email, web, social media, CRM, etc.), all working in tandem to create demand and generate revenue. You need to aggressively manage sales and marketing activities, and evaluate metrics in shorter periods -- say, every two weeks, monthly, and quarterly -- adjusting and refining your planning as new information becomes available. The idea is to compress the sales cycle, improve accuracy of forecasting, and, ultimately, increase revenue. Measuring your sales velocity is key to this. Sales velocity is a real-time measurement of the speed of your sales cycle. Important metrics to watch for determining your sales velocity are:
  • Length of sales cycle
  • Number of sales per cycle
  • Revenue per sale
  • Sales volume (total number of opportunities per cycle divided by percentage of conversions per sale)
Once you've arrived at your sales velocity, you should be focusing on actively monitoring key performance indicators (KPIs) to determine which tactical levers to tweak, in order to maximize effectiveness. Here, key marketing metrics to monitor include web initiatives, email, and direct response, as well as sales metrics like sales by lead source, win/loss rations, and customer gains and losses. Monitor these frequently, and be prepared to make ongoing adjustments. Do it pro-actively, rather than reactively, and watch your conversions rise.

No comments:

Add to Technorati Favorites