“Of course you want more revenue, but what good is it if it isn’t predictable?”
Predictable Revenue is a book by Aaron Ross and Marylou Tyler, and is also the name of Aaron Ross’s company, which works to teach modern sales methodologies to businesses.
Revenue is simply another name for sales. As the name suggests, this book is more about revenue as sales activity, than about revenue as money in the bank. The book teaches readers how to make sales predictable by building efficient sales teams.
I create marketing and sales funnels day and night and I thought this will be an en easy read. I expected the book to have include concepts which are a repetition of what’s already out there on the internet. I must admit I was judging the book by it’s cover and short length.
I was wrong.
This is a deep, detailed book, that explores concepts which will make you think harder about your sales and marketing. I believe that out of 11 chapters that the book has, 10 could easily branch out as individual books. This summary can’t address all of the fascinating concepts covered in the book, so instead I will focus on the overarching ideas and takeaways.
Revenue Predictability = The Funnel Predictability + Average Deal Size + Time Scale Predictability
Cold Calling 2.0
"It doesn’t involve any cold calling. In fact, if you’re making cold calls, you are doing everything wrong."
The authors define cold call as “calling someone who doesn’t know you and who isn’t expecting your call.” It’s not usually a pleasant experience for either the caller or the person who is called.
Cold Calling 2.0 is prospecting into cold accounts to generate new business without using “cold calls.” While it is a complex process, it involves reaching out to high value contacts and asking for an introduction to the best person to talk to. It requires minimal effort on the part of your contact, and allows you to make more meaningful connections.
Traditionally, the most difficult part of a funnel or a business system to be predictable is the prospecting. Cold Calling 2.0 is about having processes and a system of generating a new pipeline and leads predictably.
You’ll know that by putting ‘x effort’ you’ll get ‘y results,’ every single time.
It’s harder to make it profitable if your average customer is worth less than $5000.
The 3 Lead Types
"The most common mistake is lumping all the type of leads into one bucket of 'leads,’ and then making future projections based on past results."
All leads are not equal. The leads are categorized into seeds, nets and spear leads. The difference is clear when you consider the varying answers to the following questions: What happens when you plant a seed? What happens when you cast a net into the sea? What happens when you throw a spear at a target?
Seeds take a lot of time to cultivate but when they are ready they give the highest conversion rates and close rates. These require nurturing.
Nets are classic marketing funnels where you are casting a wide net and see what you get.
Spears, like hunting, involves targeted outbound efforts by an individual human.
The goal is to make it easier for the prospect to choose their own adventure. They choose how they get to know a company and its products, one step at a time.
The Sales Machine
"You can be as aggressive as ever - except the tone has changed. Rather than being pushy, all about money, and often coming off as fake, it’s about being respectful, purposeful, and adding real value to prospects, even before they become customers. Salespeople should be “pleasantly persistent.”"
To build your sales machine, you should separate the four core functions of a sales team. Form hyper-specialized teams to effectively grow results.
The four core functions are:
- “Inbound” Lead Qualification: They qualify the leads coming inbound through website, 0800 numbers, search engine marketing, etc.
- “Outbound” Prospecting / Cold Calling 2.0: They are dedicated to a proactive approach to lead generation. They work with lists of target accounts to develop new sales opportunities. These people DO NOT CLOSE.
- “Account Executives” or “Sales”: These are CLOSERS.
- Account Management / Customer Success: These are not salespersons. This role is dedicated to making the customer successful.
The predictability of revenue is predictability of each role of this team. This is the sales machine.
This book is about making your sales operations predictable. This includes making functions, such as prospecting, qualifying, closing, and nurturing predictable.
The approach is now more possible than ever with the technological advances in this area. Tools such as Salesforce.com are what make development, implementation and tracking of such seemingly complex systems work like a charm. Small businesses can do these with tools like Infusionsoft or Pipedrive as well.
Predictability is an attitude and philosophy that every other function, product and marketing should adapt to be consistent.
Customers want to buy but they resist being sold to. So how you make them come to you and ask you to sell them what they want?
You SELL THEM THE DREAM, not your products or services.
In other words, you sell them their future and the opportunities they have in that future with you, your products or services. To learn more about how to sell the dream, check out my summary of The Dan Sullivan Question.
Throughout the book, the authors have repeated “Specialize, specialize, specialize” and that brings me to ask you this question…
Is an average salesperson in your company doing a mix of prospecting, closing and nurturing by himself? Do you have specialized roles for them (even if you only have one or two people in your sales team)?