Does Your B2B Sales Model Need an Overhaul or a Tune-up?

When designing a new, or optimizing an existing, sales model, you will be faced with some tough but extremely important decisions. The lifeblood of your business is not only in creating valued products and services, but also the ability to acquire new customers at a low cost relative to the average transaction amount. When you can do this, you get positive attention from the CEO and investors.B2B Sales Models

The adjacent graphic shows the major B2B sales models and how they relate on two important criteria: the cost per transaction and the amount of personal interaction required. When you include hybrids that combine elements from more than one model, there are dozens of possibilities.

As mentioned above, the goal when deciding on your lead-to-revenue sales model is to drive the highest average transaction amount with the lowest possible transaction cost. But even if you already have a well-developed sales model, it is good to challenge it occasionally by asking these types of questions:

  • Have I identified our best target segments and is our sales model the best way to reach them?
  • Is our cost of sales higher than it needs to be?
  • Can we create a two- or three-tier model to add additional revenue?
  • Can we add a recurring revenue model to our existing sales strategy?
  • Should we replace all or part of our direct sales model with a channel strategy?
  • Are there low-cost ways of reaching a larger audience?
  • Is our pricing strategy leaving revenue on the table?
  • Is our B2B sales model fully integrated with marketing, creating a lead-to-revenue machine that is fully optimized at every state?

Instead of simply following an established path, it may be time to look at a new sales model, perhaps incorporating channel, phone sales or the web. Many smart B2B companies use online methods to educate and qualify customers, and shorten the sales cycle while improving close rates. And even if you are convinced that you have the best sales model (no overhaul required), it can probably be streamlined (tuned up). Better to address the sales model now, instead of waiting until you are under pressure to produce better results next quarter or next year.

One important factor to keep in mind: Unless you are in a rare monopoly situation, customers have the control, not you. In fact, their “buying funnel” may look very different from your “selling funnel.” When you are overly rigid in your approach, it creates conflict between seller and potential purchaser. The trick is to accept this, figure out your organizational strengths and then align these strengths with the way customers want to do business. There are three steps in the alignment process:

  1. Survey how your customers buy today and how they want to buy in the future: sales rep, distributor, retail, online, mail order, telephone, etc.
  2. Align the key buying criteria with the ability of each selling model to fulfill on those specific criteria.
  3. Offer flexibility as your customers change/evolve their needs and wants.

This post was excerpted from my new eBook: The Essential Guide to Building Your Lead-to-Revenue (L2R) Machine™: Eight Components that Drive B2B Marketing and Sales Results. Feel free to download a complimentary copy.

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Christopher Ryan

Christopher Ryan has 25 years of marketing, technology, and senior management experience. As both a marketing executive and services provider, Chris has created and executed numerous programs that build market awareness, drive lead generation and increase revenue.
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2 comments

  • Tyler May 14, 2015   Reply →

    I completely agree with your idea that, “even if you already have a well-developed sales model, it is good to challenge it occasionally”. With how rapidly everything is changing in terms of how customers are educating themselves, selecting their consideration set, and ultimately buying it really makes sense to “test” your sales model, and the questions you have prepared in this post are a great way to do it!

    Thank you for the post, I will be saving these questions for future reference!

  • Rhiannon J. May 14, 2015   Reply →

    People often forget to survey customers and then act on their response. Sales plans based on a wish-list rather than true customer response are doomed.
    Thanks for the reminder!

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