Lessons To Improve Startup Sales Productivity

Sales at startups require different skills and behaviours than sales at global corporations.

In a startup you have to appreciate that you’re still in ‘learning mode’ a lot of the time and so you have to approach each sales call or meeting as an opportunity to test your assumptions about your product and the market as well as an opportunity to sell. This mindset might seem opposed to the familiar impression of a hard-nosed salesman who recites the phrase ‘Always Be Closing’ in the mirror on a daily basis.

Improving sales productivity at a startup requires a balance between these two mindsets. Here are some lessons learned from those in the UK startup community who have managed to walk this line the best.

1. Qualify your leads properly

Research by Donal Daly of TAS Group showed that rushing the initial qualification phase of a sales cycle “simply stacks up problems for later in the sales cycle.”

“Failing to take the time to qualify that the problem is real, that the prospect is likely to buy, that the vendor has a good chance of winning and the opportunity is worth winning can result in an enormous amount of effort being wasted on opportunities that should never have reached an advanced stage in the pipeline in the first place. If you’re likely to loose – or if the deal isn’t worth winning – it’s far better to find this out early on.”

As Bob Apollo, founder of Inflexion Point Strategy Partners, explains:

“Average sales people often rush ahead and then cling on to poorly qualified deals like a drowning sailor holding onto a life raft. You need to persuade them to let go.”

2. Know your buying centre

Sam Phillips, founder of UK-based Glide Technologies, managed to cut the time it takes to close a deal from an average of seven months to five months:

“[Ensure that] the sales team knows all the key people involved in the buying process. In Glide’s case, this is often just four people: the sponsor, the financial buyer, the procurer and the user.

“The classic mistake people make is to think they gave a good relationship with one person involved in buying their product and then not think of the other people.

“It is more than just building a relationship with these key people…it is nuts and bolts things like knowing when these people go on holiday. All it takes is for someone to go away for a deal to be delayed.”

3. Shift from ‘push’ to ‘pull’ marketing

As part of qualifying your leads it’s important to be able to build relationships with potential customers instead of simply trying to sell all the time.

Thomas Power, entrepreneur, founder of Ecademy explains an important shift in sales and marketing tactics:

“People are used to ‘broadcast marketing’ – TV, radio, direct mail, and so on – where a company tries to sell you the newest, greatest, fastest, cheapest…it’s push, push, push…

“Instead you can start pulling customers towards you by shifting to ‘conversation marketing’ through blogs, Twitter, Facebook – stop pushing out and start pulling customers in.

“One great example of this is a company that stopped saying to customers ‘come and test our newest, greatest, fastest, cheapest…’ and instead said ‘tell us how you’d like us to test it’…it became more of a conversation and the customers could say ‘yes, I’m interested; I’d like to know more.”

4. Encourage co-operation within your sales team

James England, Sales Director of web-based software for the Hospitality sector, Fourth Hospitality, admits that sales people are “notoriously individualistic, so co-operation was not an easy option.”

However, by incentivising people in the right way and building a team mentality in the sales team he was able to improve sales productivity:

“We don’t incentivize people to say no…[co-operation] is simply a by-product of meeting and challenging each other to ask the right questions or qualify out the opportunity.”

Sam Phillips brings up a similar point:

“At Glide, this issue is resolved by having weekly sales meetings, where all members of the sales team have to go through their particular sales pipelines.

“We don’t believe in sending pestering e-mails around the office.”

5. Compete where your competition is weak

As a startup you have the agility to move from target to target or sector to sector far faster than an established competitor. Although the competition might already be known to the market you can turn this into an advantage by choosing to compete with them in their areas of weakness.

JP Allard, founder of Learn2Sell, calls this strategy ‘concentration’:

“The secret is never to engage bigger competitors head on, especially in their strongholds, leave these targets until you’ve a built position of strength.

“Small armies use concentration to break up larger enemy defences, selecting well chosen targets to apply laser like focus to surprise and overwhelm opponents. They choreograph fresh attacks, switching concentrated fire power to the next weak point and use ‘unpredictable and unexpected tactics’ and quickly win more territory, build momentum leaving the enemy stunned and confused.”

6. Create a new market category

An alternative strategy to taking on the competition is to render them irrelevant entirely by labelling your product or service as something brand new.

By calling your product the first entrant in a new category – as UK startup Innocent Drinks managed to create a new category of fruit smoothies – you can open up a new market and win new customers without having to argue that you are an improvement on the existing solution.

Martyn Dawes, founder of Coffee Nation, describes how he created a position for himself in the market that was the foundation of a successful exit:

“Create a new category and make the competition irrelevant. Firms that own their space are highly differentiated, have an unfair advantage and explosive growth potential.

“My eureka moment came when I realised I had created a third space between coffee bars and vending machines.”

7. Listen to your customers

Being a startup in search for a business model also allows the possibility that you may have to switch focus instead of continuing to hit your head against a brick wall.

Blake Beshore, founder of Tatroux describes the moment that he knew he had to change direction:

“First and foremost, it’s always smart to listen to your customers. Their feedback is priceless, and a majority of businesses pivot because either their product/service is not connecting, or they can’t monetise it.

“When a majority of customers keep saying your product is overpriced, it’s probably true. If you are a service-based company that founded its business model on retainers, switch to a pay-for-performance model. These little things end up making a big difference.”