As a salesperson, you know that one of your most important activities is qualifying prospects and existing customers. The activity is far from trivial. When you’re presented with what seems like an infinite number of tenuous selling opportunities, it’s difficult to determine which prospect has the biggest bang for the buck. Without a prioritization strategy, the task of prioritization is overwhelming, sub-optimal, and akin to looking for a needle in a haystack.
Odds are, the prioritization technique you’re using now is less than ideal; research suggests the average salesperson makes eight dials per hour and prospects for six and a quarter hours per appointment booked. You need parameters to help you prioritize your opportunities. According to CSO Insights’ Sales Performance Optimization Study, 45% of sales reps struggle to determine which accounts to prioritize. When you’re equipped with a specific prioritization strategy, you are better empowered to effectively invest your time in the promising accounts that are most likely to convert to customers and add sales revenue streams from existing clients.
In spite of the tsunami of analytical tools available today, it can be challenging to identify the parameters that you should focus on when prioritizing your accounts. Although the strategy will be specific to the product/service you’re selling—whether you work for a Salesforce, Oracle-type outfit or a startup—there are three key parameters that tend to have universal influence in terms of effectively prioritizing sales efforts.
1. Qualification based on industry
Very few companies offer products/services across the full spectrum of industries. That is, different offerings resonate better with certain demographics and, especially in the case of B2B sales, certain industries.
We’ve seen an influx of SaaS companies adopting a verticalized selling strategy. SaaS companies are increasingly aligning themselves with a few select industries. Recent research suggests that the verticalized selling strategy is effective—according to Nic Poulos, Principal at Bowery Capital, public vertical SaaS companies are more profitable than horizontal peers, by an average of 30 points on an EBITDA margin basis.
- When prioritizing your prospecting efforts, first carefully consider which markets you want to sell into. Today’s top salespeople are masters at pre-qualifying sales efforts based on industry. They take time to consider which industries are best suited for their offerings. If you are selling a SaaS product that offers rigorous security controls and features, you might want to focus on regulated industries, such as financial services or healthcare, where privacy is critical and stringent security features are prioritized, even at the expense of ease of use. Conversely, if you are selling a SaaS product that flaunts a very intuitive and aesthetically pleasing user interface, you might be wisest to concentrate on less-regulated industry sectors such as media or consumer discretionary. Also, don’t forget to consider competition. If one of your competitors has a stronghold in a particular industry, you may wish to focus on other industries.
- Take time to evaluate what industries comprise the largest percentage of your current business. If 75% of your current customers are apparel manufacturers, chances are you’re best qualifying opportunities specific to that industry. For most companies, the industry segments that have been the most reliable sales sources in the past are more likely to convert than industry segments that have not been keen to purchase.
- Finally, you should evaluate whether certain industries have an emerging need for your product. If, for example, you are selling a tool that integrates with Salesforce, you might want to evaluate whether specific industries have demonstrated increased interest in Salesforce recently. When Salesforce launched its Financial Services in August 2015, for instance, adoption of Salesforce among financial services companies increased markedly.
The advantage of focusing on specific industries extends beyond effective qualification of sales opportunities—it empowers you to customize outreach material and marketing collateral. According to River Cities Capital Funds, sales and marketing expenses as a percentage of revenue are significantly lower for vertical SaaS businesses versus horizontal SaaS businesses. When you target specific industries, you are better able to address unique demands and intricacies of specific verticals through you marketing material.
2. Qualification based on buying power
When prioritizing your accounts, it’s important to consider the volume of business (if any) that an account is likely to generate in the current quarter. At any given time, only 3% of your market is actively buying.
If you’re able to estimate a company’s propensity to spend, you’ll be able to approximate your prospect’s budget for your offering. There are several effective ways to gauge a company’s purchasing power. Companies generating high revenues, for example, will likely have higher budgets. A modest budget should be an immediate red flag that an account will have difficulty opening its wallet to purchase your product. If a company’s budget information is not readily available, go the extra mile—estimate current and/or past spending patterns on similar products and services. If, for example, you know that a company purchased from a competitor in the past but has not renewed the contract for the upcoming year, this can be an indication of heightened purchasing power.
And that’s not all—you can get even more granular in terms of assessing buying power of your prospects. Using growth rate metrics such as stock price change, revenue growth, or profitability growth to assess the health of a company can help you assess whether an entity is poised for spending now. This type of analysis is essential. According to Marketing Donut, 63% of the prospects requesting information on a company today will not ultimately purchase for at least three months and 20% will take longer than a year to purchase.
Several third-party tools can also help you assess a company’s growth. Mattermark, for example, has developed a “Growth Score,” which assesses (and monitors changes to) a company’s number of employees, number of website visitors, number of mobile downloads, social media interaction metrics, funding initiatives, and more. BuiltWith is another company that offers an interesting product—it allows you to determine what technologies and trackers a company website is outfitted with. Chances are, a company with a sophisticated website will tend to be more technologically savvy and therefore more likely to make technology-related purchase decisions.
3. Qualification based on engagement
Once you’ve assessed your accounts in terms of industry alignment and buying power, the third key factor to consider is an account’s level of engagement with your product/service. Nearly 2/3 of B2B marketers say that engaging key decision makers is their most difficult challenge. If you’re able to identify which of your accounts are already engaging with your brand, chances are you’ll be better poised to sell to them and keep them engaged for the long run. Even if you’re able to convince an under-engaged prospect to bite the bullet and buy from you, it’s not often worthwhile, as the probability of churn is very high. If you prioritize your opportunities according to engagement level, you’ll be able to reduce the likelihood of fruitless outreach efforts.
There are several ways to evaluate the engagement level of an account. The process will differ depending on how many offline and online marketing and support channels your company has set up. Email marketing software like MailChimp can go a long way in terms of helping you gauge levels of engagement and responsiveness to outreach efforts. In addition, if your company offers a free trial or free version of your paid product offering, you can measure current activity and use it as a reliable proxy for the level of engagement with the paid product. If a decision-maker has registered for a free trial of your offering, but has had minimal engagement, chances are they won’t be as compelled to purchase the premium product.
In general, you should consider three factors when assessing engagement levels.
- Consider timeline—How recently did a potential customer engage with your brand? Have they downloaded a white paper or joined a webinar in the last week?
- Consider frequency—How often is the potential customer engaging with your brand? 82% of buyers view at least five pieces of content from a winning vendor.
- Consider depth—How extensively have potential customers interacted with your brand? When a prospect visits your website, does he/she remain on the page for 30 seconds or for 20 minutes? If a potential qualifier watches a video or reads a case study on your website, does he/she leave a comment or engage in social selling and share the media form with others?
In a typical firm with 100-500 employees, an average of seven people are involved in most buying decisions. Higher levels of engagement will increase the likelihood that an individual will act as the champion for your offering. Securing a champion who will back your offering is a surefire way to heighten the likelihood you’re able to cross the finish line.
Assigning priority to the qualifiers
Once you’ve catalogued your accounts according to industry, purchasing power, and engagement, it’s time to assign priority to the qualifiers. The most common approach is to categorize your accounts in tiers.
- Tier 1 qualifiers should comprise your most promising accounts. This is where you should be investing most of your time and efforts.
- Tier 2 accounts should consume some of your time, but should also be privy to scaled marketing efforts.
- Tier 3 accounts should consume very little of your time, and should almost exclusively be party to scaled marketing efforts.
It’s important to keep in mind that account prioritization must be ongoing. Ideally, prioritization is fully automated, with built-in alerts to notify you of any changes in the buying power or behaviors of accounts. According to Velocify, companies that fully utilize an automated prioritization strategy can expect to significantly increase their revenues and see a 97% higher conversion rates. With the help of predictive analytic tools, you can monitor industry trends, spikes in spending patterns of particular accounts, and fluctuations in engagement levels.
Account prioritization is arguably the single most important process that you will need to address at the onset of each quarter. The importance of account prioritization has been fueled by the increased focus on Account Based Marketing (ABM). As a salesperson, it can be overwhelming to qualify and rank leads. The basic prioritization strategy outlined here should bring clarity to your book of business and enable you to become a more effective salesperson.