by Ilya Pozin,
The end goal is to break down revenue generation into specific, quantifiable action items. By making very small changes to each variable you can compound growth in your revenue streams and increase the throughput of deals through your pipeline. Once you get your revenue to where you want it, your focus should shift to maximizing profit margins (without sacrificing qualify) to truly scale your business.
Revenue = The amount your sales pipeline generates per month.
Number of leads – Increasing leads isn’t easy. For my Web design business, Ciplex, we focused on making sure that every website we built for our clients included a credit that linked back to us. When people saw the great sites we built and wondered who created them, they had an easy way to contact us. That’s just a small opportunity. Depending on your business, you can try a variety of marketing tactics, from trade-shows and traditional advertising, to SEO, PPC, social media, and word-of-mouth marketing.
Conversion rate – Your task here is to get better leads, implement a better prequalification round, optimize your website for conversion, and improve your sales process and pitch. To increase conversion rates at Ciplex, we focused on training our team members to improve their product knowledge. Instead of sales people, they became consultants, working with the client to determine the best solution for their business. Clients loved that and we saw our conversion rate jump as a result.
Average deal size – Can you improve your product quality, sell more in a transaction, or try introducing higher ticket items into your product/service package? Be careful with this one as it doesn’t always make sense to raise your prices. We left this one out at Ciplex, as we wanted to stay competitive, and the market didn’t give us much room to increase pricing.
Average time to close a deal – There’s no substitute for great salespeople and empowering them with great systems, tools, knowledge, and processes to get the job done right. Just as we saw our conversion rate increase when we focused on training our team, we also saw the average time to close a deal go down.