We’re continuing our series on how a lead to money process brings about more deals for more money in less time. In this post we will take a closer look at the second outcome of the lead to money process; Generating More Money.
Lead to Money
As we learned in Part 1 of Lead to Money series, this process begins with marketing automation, moves into planning with territories, quotas, and coaching, continues with enablement and CPQ, and culminates with commissions and incentives. Yesterday we dug into how the different tools in this process bring about more deals, but today we’ll explore how many of the same tools can be leveraged to bring about more money, through larger deal sizes.
Generating More Money
The technology used in the lead to money process can bring about more money in a couple of different ways. One may be readily apparent, more deals = more money. The second way, may be a little less obvious. These tools can be leveraged to increase deal sizes.
Proper planning with optimized territories and accurately aligned quotas will generate more revenue. According to Gartner, optimized territory and quota plans will lead to a 5% increase in revenue. This increase in revenue is brought to fruition by enabling sales to focus their efforts on the areas/companies that will have the greatest impact on their results. Having the ability to align territories based on historical data, whitespace, competitor saturation, and market value, will permit you to understand the true value and potential of each territory. Once a proper value is assigned it becomes easier to allocate reps to those territories and ensure that they have realistic, attainable quotas. Assigning attainable quotas will keep your reps engaged and motivated, eliminating unnecessary attrition of your top sales talent caused by low morale.
To help your reps hit their quota effective coaching by managers is a must. With just 3 hours a month of targeted sales coaching companies will see an average increase of 17% in quota attainment. Having the ability to pull all of your metrics and KPI's from disparate systems together in a single, easy to use platform will allow sales managers to spend more time in the field with their reps and less time in the office pulling and sifting through data.
Further increases in deal size can be found by enabling your sales teams with the right information at the right time. Properly enabled sales teams will bring about more money through increased cross-selling and up-selling with the use of playbooks. With enablement your reps will not only be able to access the information they need, when they need it, but through deal portals they’ll also gain better insights into where each prospect is in the buying process. Understanding how far along in the buying cycle your prospect is will help your reps engage the prospects at the right time with the information that is most relevant to their needs.
Revisiting CPQ + Commissions + Learning
Configure Price Quote (CPQ), by itself, will increase the size of each deal by ensuring reps are up-selling and cross-selling items that are pertinent to the customer’s needs. It also, protects margins by showing the margin health of each item in the quote, and puts in place an automatic approval process for discounting. CPQ has been shown to produce deal sizes that are on average 104% larger and result in 26% more reps hitting their quota.
By integrating CPQ and commissions you can realize an even greater bearing on the size of each deal. A performance based commission tool can add up to 3% of revenue per user, according to Gartner Research: Processes for CRM Sales. But having the ability to show your sales rep the potential commission they will earn on a deal as they put together the quote will motivate them to go the extra mile to increase win rates, encourage them to up-sell and cross-sell other solutions/items, and eliminate the abuse of discounts, leading to bigger commissions for them, and larger deal sizes for you. Integrating these tools will generate drastically larger deals, increasing revenue without the need to increase sales capacity.
In other words CPQ + Commissions + Learning = WIN. A win for your sales teams, a win for your bottom line, and a win for your investors.