How to Grow Your B2B Sales Pipeline Exponentially
- If there were a silver bullet to grow the sales pipeline, it would have been discovered and patented long ago. There's no magic formula and no single success factor. But there are evidence-based best practices that can be assembled into a framework for systemic execution and predictable results that deliver near linear pipeline expansion.
- Leveraging multiple B2B sales pipeline best practices in parallel creates synergies and shifts revenue generation from incremental improvements to order of magnitude growth.
- Here we share research findings and 5 best practices that can achieve a multiplier impact to the B2B sales pipeline.
Research performed for The Sales Excellence Report surfaced several evidence-based best practices that delivered significant pipeline growth.
Survey respondents were categorized into one of three performance archetypes based on sales growth. The research then measured adoption and performance of sales methods by cohort. The Best-in-Class segment (i.e., the top 15 percent) applied specific methods that delivered 1.76X more pipeline growth than the next two groups of Medians (i.e., middle 50 percent) and Laggards (i.e., lower 35 percent). The methods that consistently delivered the highest performance are referred to as evidence-based best practices.
When we reviewed the B2B sales pipeline best practices holistically, it became clear that they were not individual pursuits. Instead they were part of an organized growth framework. In part, the research found it wasn't just what they did, it was how they did it.
In this post I'm going to share 5 of the best practices consistently used by the Best-in-Class leaders.
Best Practices to Achieve a Pipeline Multiplier Impact
Start with Revenue Engineering
To make B2B sales pipeline growth systemic and scalable you need a clear and measurable goal and a model that shows how to achieve that goal.
A sales funnel is a progressive filter. Leads go into the top of the funnel and each stage yields progressively fewer.
Revenue engineering uses lead conversion history and predictive analytics to make pipeline growth deterministic. It measures the yield and elapsed time at each stage of the funnel and calculates the total lead-to-revenue ratio and duration.
That permits you to then work backwards. You can set the revenue goal, which is the bottom of the funnel amount, and see the volume of leads that need to go into the top of the funnel to achieve that goal.
The predictability is improved when the sourcing of those leads is data driven. For example, how many campaigns or other demand generation efforts are needed to scale up to acquire the number of needed leads? That answer will depend on the types of campaigns, their conversions, and the cost per lead. If you don't have that type of campaign and lead data yet you can apply industry benchmarks to calculate the results.
The below diagram shows example stages and stage to stage conversion factors that drive the calculation.
The funnel diagram shows how and how many leads traverse from top to bottom. It also permits What-If analysis and pro forma modeling to show how different marketing programs or campaigns can be assembled or manipulated to achieve the target revenue goal.
Revenue engineering research shows that salesforces or marketers that use this technique acquire 2.5X more leads for the salesforce than those who do not.
Apply Campaign Portfolio Optimization
Marketing campaigns are used to fill and grow the pipeline. That's because they are the most effective tool and when done pursuant to a framework can be scaled up or down while managing cost per lead and cost per customer acquisition.
Best-in-Class leaders manage campaign portfolios while their lower performing peers tend to perform piecemeal campaigns. We know from campaign research published in the Marketing Transformation Report that marketing campaign portfolio optimization acquires 25% more sales leads at 19% lower cost per lead.
That's because campaign portfolio optimization is a structured way to mix campaigns for the highest cumulative results. It maximizes the value of the total portfolio by continuously reallocating budget among campaigns based on their performance at any point in time.
To bring predictability to the process, this technique categorizes campaigns based on their performance attributes so they can be manipulated for improved results. For example, campaign types can be categorized as digital or physical, inbound or outbound, or by many other factors.
Categorization also identifies the types of campaigns that can be driven by the salesforce. For example, despite the name, Activity-Based Marketing (ABM) can be a salesforce-led campaign and is extremely effective in driving pipeline growth.
Campaigns can also be modeled for time-based goals. Certain types of campaigns acquire leads that start further down the funnel and therefore close faster. For example, referral campaigns often generate the most qualified leads that incur the shortest sales cycles.
Only by modeling campaign types in the aggregate, that is the portfolio, can you manipulate the mix to accelerate the cumulative effect and most grow the pipeline.
Use Nurture Campaigns to Double Lead Volume
For most B2B industries, about two-thirds of acquired leads are not sales-ready. Distributing unqualified leads to the salesforce wastes their time, contributes to lead leakage, and delivers a poor experience to potential buyers. It also clogs the pipeline, slows funnel velocity and overstates the forecast.
The sales best practice here is to measure lead quality with an objective score. Then you can immediately distribute sales-ready leads to the salesforce and hold back and nurture unqualified leads until they become qualified.
The nurture marketing process will significantly increase the pipeline. Here's why.
Lead acquisition research shows on average, 26 percent of acquired leads are sales-ready, 49 percent are not yet sales-ready and 25 percent are unqualified. It's that middle segment of not yet sales-ready leads that is either cultivated until they become ready or lost to lead leakage.
The upside is that 72 percent of the not yet sales-ready leads will become sales-ready in 6 to 11 months, on average. Nurture campaigns deliver periodic content to this group, measure their buy signals and then distribute them to the salesforce once they achieve lead scores that indicate they are sales-ready.
When you extrapolate these results, the data shows that nurture campaigns can produce more leads from the not-yet-qualified volume than were obtained in the initially qualified group. That doubles the number of total leads sent to the salesforce, cuts the cost per lead in half, and creates a high impact pipeline multiplier that goes untapped by most companies.
Align Sales and Marketing
The prior three best practices highlight the synergy achieved when sales and marketing pursue pipeline growth as a unified team. But that stands in contrast to the norm.
In a Forrester report, titled Master the Mechanics of Analytics for Revenue Growth, the analyst firm advised that only 30 percent of marketers believe marketing and sales goals are aligned.
However, the shift of sales and marketing from standalone departments to integrated partners is essential to maximize the pipeline. And the payoff is big.
Forrester Research reports that companies with aligned sales and marketing groups achieved an average of 32% annual revenue growth while less aligned companies reported an average 7% revenue decline. That's a very stark contrast.
There's a framework to achieve Sales and Marketing alignment. At a high level, it consolidates the marketing funnel which measures leads and the sales funnel which measures sale opportunities into an integrated revenue funnel.
It defines leads during their progression through the funnel. For example, it may define a Marketing Qualified Lead (MQL), Sales Qualified Lead (SQL) and sale opportunity. Those definitions are important as they make leads and the pipeline measurable.
It then uses a Service Level Agreement (SLA) to define marketing and sales responsibilities needed to grow the revenue funnel. Marketing is likely responsible for delivering a certain volume of sales-ready leads to the salesforce.
Sales is responsible for following up those leads within a prescribed timeframe and advancing them to sale opportunities within another specified timeframe. Many leads will stall or become unqualified so the salesforce is also responsible for returning those leads to marketing so they can be nurtured until they again demonstrate buy signals.
Marketing Cloud or CRM software can automate the process, identify variances for quick intervention and report results.
Sales and marketing alignment is a best practice that folds in other pipeline best practices to create a force multiplier impact and drive significant and sustained pipeline growth.
Apply Data and Analytics
Each of these B2B sales pipeline best practices require real-time information reporting to measure progress and initiate quick iterations or course corrections.
It's essential that sales leaders apply data and analytics to be alerted in near real-time of any program or method under-performing so they can take quick action.
Sales Dashboards show what's working and what's not. They are the top delivery tool to get the right information to the right person at the right time.
However, there are a few challenges to make dashboards effective. The first is to shift information from being merely interesting to inducing action.
Power is created from action, not visibility. Simply displaying key performance indicators (KPIs) in a dashboard falls short of inducing action. However, when dashboard KPIs are aligned with objectives, compared to benchmarks, linked to playbooks, or integrated with next-best-recommendations, the information drives action.