Why do some companies take off, growing rapidly year after year after year…while others struggle along? What’s the difference between companies like Salesforce.com, Slack, Zenefits ($1 to $100 in ~two years), Acquia (#1 fastest growing private software company in 2014), and everyone else?
After publishing Predictable Revenue four years ago, then working with many companies and cofounding an outbound outsourcing and software company (CARB.IO), I wanted to know not just what creates predictable revenue, but hyper-growth revenue.
So I set out with Jason Lemkin of SaaStr, and the founder of EchoSign (who took it from $0 to over $100M in revenue, including a sale to Adobe), to find key indicators that – if you have a business or something sellable – determine growth.
Our new book From Impossible To Inevitable: How Hyper-Growth Companies Create Predictable Revenue outlines a 7-part formula for achieving hyper-growth, and outlines a “painful truth” associated with each of these 7 parts. This blog post focuses on the first, most fundamental painful truth that leaders of hyper-growth companies must accept:
You’re not ready to grow faster…until you “nail a niche.”
You’re pushing to grow faster. Maybe you’re trying to kick start flat growth, or triple it from 33% a year to 100% a year.
So you start raising your goals and investing in sales, product, and marketing. And you’re especially pushing to increase qualified leads, the main engine of faster revenue growth.
But… it’s been harder than you expected … maybe a lot harder.
Are you sure you’re ready to grow faster?
Because when it feels like you’re swimming upstream every day to generate leads, or to close new customers from the leads you do get, you might have a bigger problem.
All that time, energy and money invested in growing new leads and closing sales can be poured into a black hole—if you haven’t “nailed a niche.”
“More” Isn’t Better
If you’re like most companies, taking a “more is better” approach to product line expansion, content creation, and markets being targeted, you’re confusing your salespeople with too many ideas, options, and products. And overwhelmed or disorganized salespeople create confused customers.
“Nailing a niche” is about focusing. To nail your niche, you need to focus on speaking to the right targets, about the right solution that addresses their actual pain. You also need to regularly evolve your prospecting, marketing programs, and sales collateral to better fit the needs of the target audience in your niche.
As you may expect, this can be easier said than done. “Nailing your niche” takes time and lots of trial and error; seemingly as soon as you have it “nailed,” things change and you need to do it again.
But before you can create clarity for your target buyers, you first have to create it for your salespeople.
Sales Confusion = Customer Confusion
Salespeople are out on the front lines working with customers, so establishing clarity across your sales force is the first step to ensuring clarity amongst your target buyers.
Here are a few tips to help build clarity across your sales force:
- Decrease time-to-expertise by having new hires conduct at least 10 interviews of senior salespeople or internal exerts, and customers, as part of their first six weeks on the job… in addition to shadowing as much as possible. First-hand experience is the best way to get new salespeople up-to-speed faster.
- Take a fresh look at making your sales system, and the data inside it, easier to use. Can salespeople find what they need in your CRM/SFA? Do they – like salespeople at even the top 5 global software companies – pretty much ignore the system altogether because it’s so problematic for them? To increase adoption of your sales tools, cut the clutter and make sure the data is valuable to users.
- Invest in sales enablement tools to help simplify salespeople’s jobs so they can spend more time engaging with customers. How easily, or not, can they find the content pieces and stories they need for the right prospect at the right stage, right now? Put the right tools and technology in place so salespeople have more time to focus on what you hired them to do: sell.
Just as it’s important to create clarity for salespeople, so too is it important to create clarity for your buyers.
Reduce Buyer Confusion
If you were to assess your peers, I’m willing to bet 90% of their websites and sales collateral sound like jargon to you. And, the problem is, there’s a 90% chance they feel the same way about yours.
Here are a few things to consider that will help reduce confusion amongst your target audience:
- Evaluate who’s writing your content. Make sure your content creators talk to customers multiple times a week. Most content’s written by people who rarely talk to customers and never sell to them. By people who are making up what they think buyers want to hear. You end up with verbose, jargony material that’s either too long or too short, but either way it doesn’t ‘hit home.’ Providing buyers with material that’s relevant and on-point is the first step to achieving clarity.
- Remember that “cool” can be death. If people say “cool” at the demo, but rarely buy, you’re a nice-to-have. Does your content prove to the right customers – in their own language, in the way they want to understand you and buy – that you are a need-to-have? Nice-to-haves never happen because they quickly get dropped to the bottom of priority lists. If you nail your value proposition, buyers will begin to take your products more seriously.
- Give buyers a reason to believe you. You should be able to back up a) your claims of gains, and b) why they won’t fail in implementing. Case studies and customer stories go a long way, especially when they include concrete details and you cut the fluff and jargon out, so they sound realistic rather than staged theatre. Buyers are more likely to buy from companies they deem as being reputable and trustworthy. It’s your job to illustrate these qualities.
- Differentiate yourself. How do you stand out from the ever-growing noise of more companies that sound just like you? In today’s digital world, people aren’t willing to waste their mental energy trying to figure you out. Be unique. Make it simple for buyers to understand what you’re selling… and why they should care. For more tips, check out this brilliant presentation called How To Kill A Word.
“Nailing a niche” isn’t something only emerging companies go through. Any time a company launches a new product, enters a new market, or begins a new kind of lead generation program, they need to (re)nail a niche. In fact, as you get bigger or grow faster, this becomes more of a problem because confusion can grow too.
Whenever you’re working to break through to a new level of growth, start by “nailing a niche”… and make sure you’re ready to grow faster before you spend a ton of time and energy trying to do so.
About the Author
AARON ROSS (@motoceo) is the co-author of From Impossible To Inevitable.
Aaron is married with 12 children (mostly through adoption), loves motorcycles, and keeps a 25-hour workweek. He’s a keynote speaker and best-selling author of Predictable Revenue, called “The Sales Bible of Silicon Valley,” based on an outbound prospecting system that’s created more than $1 billion across Salesforce.com and other companies. He’s cofounder and CRO of CARB.IO, a Pipeline Automation software company, and is also the cofounder of PredictableUniversity.com.
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