A good sales strategy is action oriented and outlines how to reach defined milestone targets that deliver on a long-term ambition. Usually a good sales strategy covers market segmentation, target customers, product strategy and critical success factors. A good sales strategy is the foundation to increase sales.
Here are 10 areas to include and answer to make a good sales strategy:
- What are your target customers?
- How to break-down an ambition to actionable targets.
- What reference customers do I target, why and how, in a good sales strategy?
- Defining the product offering that will increase sales is a good sales strategy practise
- The lead generation strategy is key in any good sales strategy.
- The practical sales plan is usually a set of actions that expect to deliver the milestone targets.
- If you sell complexed products you include your sales relationship plan to make a good sales strategy.
- A good sales strategy includes your critical success factors.
- Do I have a SWOT analysis in my sales plan?
- What sales targets shall I have to make a good sales strategy?
So, let’s dig into what makes a good sales strategy!
What are your target customers?
Target customers are your prioritized customers that you have designed a solution for. These are your narrowly selected ideal customers. Niche down for a good sales strategy to improve your likelihood to increase sales.
Most entrepreneurs and companies that I have met that has a steady growth in their sales have a pretty good view on which customers they serve.
You can argue that a business starts with its ambition. However, nailing a business’s target customers pretty is really the key to success.
A good sales strategy usually includes a very clear and niched down definition of the company’s target customers. You can’t serve everyone.
The difference between target market and target customers
A target market is a broader concept than a target customer. Usually target markets are defined when developing complementary products or entering new markets. It helps understand that particular market.
Soon however, one needs to define specific target customers to have a good sales strategy that leads to increased sales. It’s hard to sell to a market. You build relationships with prospects and customers and need to define your target customers.
Why narrow down when defining target customers to make a good sales strategy?
You narrow down your target customers to be industry and application specific on what you offer. Customers always look to solve a specific problem and naturally look for authority and expertise.
Attempting to serve a wide audience of different customers don’t make you the go to authority within a specific field of expertise. Unless your Amazon, PayPal or similar, you shell niche down to be relevant and the preferred supplier.
A good sales strategy is almost always built upon a sharp and narrow problem solution. For that purpose, you will need to be specific on who you serve. Unless you’re clear about this, your sales strategy will not be as good as you hope for.
How to approach a target market and target customers
With a new product launch, or with new startups, you need to focus on early adopters. Those will share you vision and ideas and relatively speaking, be the easiest to convince and sell to. A good sales strategy reflects this and treat those early customers as important reference customers.
In this phase of early sales, you may talk about a target market and may not yet fully know who your target customers will be.
You will be able to define target customers once demand and specific customers pain points becomes clear to you. This should be an early ambition of your sales strategy.
What is usually a good sales strategy, is when you target more customers only once product market fit is established. You shall have enough reference customers before targeting enterprise customers. Those are usually not early adopters, risk avert and rely on what others do.
Read more about selling to early adopters and early stage customers.
Read more about how to grow tech companies beyond early customers.
How to break-down an ambition to actionable milestone targets
A good sales strategy starts with a bold ambition, reversed-engineered into actionable milestone targets. For a 5-year ambition you typically set quarterly, actionable milestone targets for year1 and 2, semi-annually targets for year 2 and yearly targets for year 3 – 5.
Every following year you push the plan and your milestone targeting one year forward towards the longer-term ambition.
It is very clear that great entrepreneurs have an articulated and bold 5 to 10-year ambition. That ambition might change once or twice, in particular if pivoting in the early years of a business. But for strategizing, planning, making people enthusiastic and for execution, a specific and bold 5-year ambition makes a huge difference.
A bold ambition to make you know in what direction your heading to solve a narrow customer pain point makes all the difference between a platform for success and common trial and error.
Clear objectives are where you start the work to create a good sales strategy.
Once your 5-year ambition is articulated and elaborated upon you need to list critical success factors. Use your critical success factors to reverse engineer what milestones that needs to be delivered upon to fulfill your ambition. Those targets shall be actionable milestone targets with clearly defined deliverables.
A milestone target is sub-target that will eventually lead you to your final target.
Good sales strategies for new product launches usually have actionable milestone targets that looks something like this:
|Product launch||Milestone target||Deliverables||Responsible|
|Year 1, Q1||Conceptualizing||Use case and prototype|
|Year 1, Q2||Minimum Viable Product||Product launch|
|Year 1, Q3||First reference customer||Signed contract|
|Year 1, Q4||3 reference customers||$X million in sales|
|Year 2, 1st half-year||Expansion sales team formed||X new recruitments.|
|Year 2, 2nd half-year||20 reference customers||$XX million in sales|
|Year 3||50 reference customers||$XX million in sales|
|Year 4||First enterprise customer||Signed contract|
|Year 5||4 enterprise customers||$XXX million in sales|
Entrepreneurs and investors both like stretch targets. Usually because they are used to think visionary and are optimistic. Generally, they are ambitious people. Sometimes also because they know that they are at the top of the food chain and can always change targets.
Salespeople are typically very careful with targets. Be mindful. They feel good when they not only deliver on their targets but deliver beyond targets. Incentives are usually linked to sales targets, hence low sales targets makes it easier to earn incentives,
Make no mistake: A good sales strategy have a bold ambition, critical success factors identified, stretched milestone targets and clear deliverables.
What gets measured gets done. Ambition and milestone targets are easily understood and create engagement.
What reference customers do I target, why and how, in a good sales strategy?
A good sales strategy to launch a new product, or a new startup, makes it very clear to everyone who the preferred reference customers are. It makes clear why reference customers are important for the next stage growth and how to target reference customers.
Why do I need reference customers? Your early sales early adopter customers are your likeminded businesses. They share your ideas and your ambition. Later stage growth customers like enterprise customers are sceptic and pre-occupied. They aim for efficiency improvements, specific features or life-cycle investments, but they are not early adopters. You need early adopter reference customers to convince the majority of potential but pre-occupied customers.
Your early adopters make a good reference customer. Those who truly get tremendous value from your product and become an advocate for your service. Your customer ambassadors.
A good sales strategy emphasizes the importance of reference customers, makes everyone in the organization to understand this. A good sales strategy also elaborate on what to expect from reference customers, how to use them in future sales.
Customer success and customer satisfaction are key for your early adopter customers to be your customer ambassadors.
Your sales strategy needs to address what activities and deliverables you expect to make sure your customers have success. Customer satisfaction is key to increase sales.
Defining the product offering that will increase sales is a good sales strategy practice
A product offering starts from a customer pain point or burning desire and provides a solution.
A good sales strategy makes the product offering clear to narrow down and create focus in the entire sales strategy.
You define your product offering by starting with a customer pain point or burning desire and describe your solution solution. Add competitor analysis and how you shall position you offering in your market.
A minimum viable product is the offering you develop for your early adopters. That is valid if it’s a new product or if you’re a new startup. The minimum viable product is based on the premise that you can deliver sufficient features or services to solve a specific paint point.
Making your product offering clear and distinct in your sales strategy helps create clarity what to do in terms of sales activities, actionable milestones.
The lead generation strategy is key in any good sales strategy
A good sales strategy focuses a lot on the lead generation strategy. Depending on your ambition and conversation ratio you need a lot of leads that can become prospects and customers. A good lead generation strategy can make doze business shine with increased sales.
Your leads are the potential customers you have identified that fits with your target customer profile. Lead generation is when you find leads that you can prospect to possibly become a future customer.
Without leads you will struggle with your business. Your leads are your sales prospects that you try to convert to paying customers. You only have passive sales if you have no leads and no active sales operation.
Lead generation can be both marketing leads and sales leads.
- Marketing leads are indetified target prospects and customers to whom you direct marketing activities to nurse relationship with.
- Sales leads are your target prospects that you initiate sales activities with.
Good sales strategies include your lead generation strategy. More specifically:
- How many leads you need to deliver on sales targets.
- They way you expect to generate your leads.
- How often leads are to be generated (weekly, quarterly, bi-yearly).
- Who in your organization generates leads.
Leads can be found in search following your market mapping and market segmentation. Quarterly ‘mining meetings’ where teams workshop to create gross lists of new leads is also common in B2B sales. Industry fairs, referrals, social media and advertising are other sources for lead generation.
The amount of leads necessary to generate enough sales can’t be underestimate. A well-though through lead generation strategy helps a lot when you aim to increase sales.
The practical sales plan is usually a set of actions that expect to deliver the milestone targets
The corner stone of a good sales strategy is the practical sales plan section. Usually it’s an appendix to the sales strategy that is updated annually. The practical sales plan shall be hands-on listing target customers, objectives, milestone targets, KPI’s and responsibilities. It’s an action plan.
The practical sales plan usually takes the form of an excel sheet that is updated at regular sales team meetings. If will be a create tool for sales management and follow up if updated regularly.
A practical sales plan usually consist of the following tables:
|Target prospect||Pain point||Offering||Sales target||Milestone achieved, date||Likelihood (1-10 scale)||Sales responsible|
A practical sales plan can also include channel strategy specific actions. Detailed marketing plans and plans for supporting events and industry fairs is also common, subject to what business you operate. Most important area actionable milestone targets per target prospect, and regular updates and follow up routines.
If you sell complexed products you shall include your plan for your relationship journeys, to make a good sales strategy
Complexed product sales are usually organized in prospect and customer specific relationship journeys. A good sales strategy defines how your key relationship journeys shall be organized and carried out to increase sales.
This is usually included in in good sales strategies, often as an appendix similar to the practical sales plan:
- Set relationship sales targets that makes you close deals – and it’s not the sales targets you think. More on that a bit further down.
- Plan relationship sales journeys for each sales prospect – you need 18 – 36 month milestone activies.
- You need to deliver value adding content – you will not deliver value with sales pitches.
- Make conversations and add value, not sales pitches – that is how you make yourself relevant.
- To deliver on sales targets you need multiple, parallel sales processes – it’s simple mathematics.
A good sales strategy includes your critical success factors
Each business has their critical success factors in sales and those needs to be outlined to make a good sales strategy. You shall also define KPI’s for your critical success factors in sales. Finally, ensure that each critical success factor is taken care of and you will have a foundation for a good sales strategy.
Examples of critical success factors in sales:
- Entrepreneurship – focus on customer solution, agility and the willingness to always solve problems.
- Competence – to be able to meet customers on their terms with authority and expertise.
- Reliability – always meet or exceed promises to customers.
- Speed – act fast but with high quality. That is always a very appreciated capacity.
- References – is important for non-early adopters and key to be relevant and taken seriously.
- Features – that solve customer problems with a positive user experience.
Critical success factors are sometimes expressed as part of a company mission statement. Unfortunately, those mission statement tend to be paper products. Don’t loose track of your critical success factors, those are key in delivering any good sales strategy.
Shall I have a sales SWOT analysis in my sales plan?
You make a sales SWOT analysis to understand where your product and sales capability stand in the market. The sales SWOT analysis stands for your strengths, weakness, opportunities and threats in your sales strategy. Add in your sales strategy what actions you will take, focusing on your strengths and opportunities.
To make a SWOT analysis requires honesty. I have experienced this to be a challenge in some cultures where weakness and threats are difficult to discuss. Be mindful. A SWOT-analysis is an important tool.
Experience show that focusing your efforts to further improve your strengths and make use of opportunities has the highest benefit. That does not mean that you shall take lightly on your weakness and threats, but value creation is easier focusing on strengths and opportunities.
Sales SWOT analysis is typically created through internal workshop and by interviewing customers and partners.
List actions you can take to enhance strengths and explore opportunities. Assign responsibilities and set milestone targets. Don’t do this in isolation, make it an integral part of your practical sales plan.
What sales targets shall I have to make a good sales strategy?
There are two types of sales targets:
- Milestone targets, e.g. in a relationship journey.
- Financial targets such as sales volume targets and gross margin targets.
CFO’s and controllers tend to focus on financial targets, which are important and measurable.
In sales however, milestone targets are often a very powerful tool. Complexed sales often progress with milestone events in a sales relationship journey.
A good practice is not to have too many targets. You risk losing interest and engagement from your salespeople. Use experience and your judgement in addition to a few sales targets only. That’s a much more valuable sales target practice then a long list of targets just for the sake of measurability.
Read more about relationship journey’s for increased sales.
So, with all this I hope you have got a feeling for what makes a good sales strategy.
I have tried to condense 30 years of experience what makes a good sales strategy. Good in the sense that it is engaging, actionable and will help you reach your ambition.
Final tip: Engage your key salespeople and management team in the making of the sales strategy. Being asked and engaged makes people take ownership and responsibility for a strategy.