How Private Equity can fix failing B2B sales propositions
Despite a pretty bleak economic backdrop over the past decade, private equity have continued to perform – transforming their business models and investment strategies to buy, build and grow successful businesses that continue to outperform the market.
Their approach to creating value has also had to change. Initiatives focused on profitable revenue growth as well as cost cutting are now key – prioritising strategies that boost sales effectiveness, improve pricing and enhance margin.
However, returns from this type of investment are less likely to be realised in the short-term. Take improving sales effectiveness. Overhauling existing sales and marketing operations and putting the right people in place doesn’t happen overnight. But when speed to ROI is important (especially to help fund bigger infrastructure investment) more immediate opportunities to boost sales cannot be overlooked.
Quickly unlocking new opportunities for high-margin work is particularly important for business services where buying cycles can be long and drawn out. If you don’t start accelerating the pipeline immediately, you might not see new revenue for 12-18 months (or more).
A strong B2B sales proposition can quickly boost sales force (and marketing) effectiveness; it is proven to short-cut long sales cycles – driving clients and new prospects to buy, buy now, buy more and buy from you. It’s a powerful tool, but in my experience many propositions in the business services industry fall short.
Is the sales proposition holding back your B2B investment?
Four questions your sales proposition should answer:
#1 Why should prospects care about what you have to say?
In B2B, showing clients new ways to make money, reduce costs and mitigate risk that they have yet to spot is the single biggest thing that will spark prospect’s interest and drive them to buy – a whopping 53%, compared to brand (19%), client service and product delivery (19%) and price (9%).
For the most attractive segments, do you have a tailored and provoking sales proposition, built around latent demands, that are connected to the business goals those clients and prospects care about?
#2 Why should they believe you?
A provocative sales proposition comes with a burden of proof. Purchases of business services are often high-value, involve multiple stakeholders and are therefore high-risk. A buyer’s reputation is on the line if a wrong decision is made. A strong evidence-backed business case is needed to convince and give confidence to buyers, that the new course of action you are championing is the right one. Without this, you may have sparked their interest but haven’t convinced them to buy.
Are you able to quantify in monetary terms, or using other meaningful metrics, the potential gain expected by pursuing this new course of action, or the loss if they chose to ignore it?
#3 Why should they act now?
The B2B sales cycle is long, therefore, your proposition needs to create a sense of urgency – if you don’t act now, the consequences mean you won't reach your goal.
As part of your business case, is there a compelling and critical requirement to act now?
# Why should they buy from you?
You need to create new opportunities only you can win. If clients and prospects can make the changes you’re suggesting themselves – or competitors are better placed to help – you may get a meeting but they won’t buy from you. Your proposition must shine a light on your distinct capabilities.
Are you able to clearly articulate what your distinct capabilities are that make you best placed – over the competition – to help meet this specific latent demand?
If you can't answer these questions or unhappy with your answers, your investment firm's sales proposition may hold you back from sales growth in the short and long-term, regardless of any other investment to boost sales force effectiveness.
For more on how to get to a provoking, differentiated and client-tested proposition in five days, take a look at my colleague Alex’s blog: Three new routes to building winning campaigns in eight weeks (or fewer).