Lead a sales team for a web development agency
You’ve invested time and work to get your web development agency off the ground. But – as with every business start-up – it’s not a one-size-fits-all deal. You’ve started your business, but now you need to figure out how to make it work. This can be a challenge, given that so many web development projects are one-time efforts.
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Obviously, you need a constant influx of new customers to grow and scale your business. But how do you achieve this while maintaining your own workload? Start a sales team.
Contents To display
1. Plan for growth
2. Find the right person
3. Get on the same page
4. Take a test drive
5. Know your CLVs
6. Boost CLV
Plan for growth
You want to take your web development business to the next level, but that won’t happen without consistent lead generation and sales.
Ideally, you’re aiming for expensive projects for long-term clients. Web or application maintenance projects, for example, require ongoing work, which guarantees a continuous stream of income. And when negotiating with potential clients, it’s best to arrange to charge them by the hour rather than by the project. This will ensure that you are fairly compensated for any revisions or expansion of the scope of work you have done.
Once you’ve defined your target market, it’s time to hire a team that can help you tap into it.
Find the right fit
Plan for a phased build: In the beginning, one sales assistant might be enough to start generating the leads and sales you need to gain momentum. Your strategy for developing your sales will depend on your target customer profile. If you’re selling large projects to large accounts, you’ll need someone who has experience doing big business. On the other hand, you may be able – at least initially – to bring in younger, less experienced salespeople for smaller clients or projects.
Decide on a division of labor that works for your business. An inbound seller can manage inbound leads through email capture or contact form submission through landing pages or through free offers, for example. An outbound salesperson may engage in cold calls and emails, which culminate in a meeting with the prospect.
Beyond selling product packages, projects typically have a custom scope. This means your salespeople need to have some domain knowledge, in addition to the ability to sell solutions, especially if they’re selling to a company’s marketing department. This requires a level of expertise that usually comes with greater experience. Be prepared to pay for it.
Get on the same page
You want everyone on your team to be on the same page, which means you need to create a digital workplace where all your data resides in one central location and is accessible to all team members . Think of it as a digital repository covering the full gamut of sales information: lead data, leads, communication, closed leads, inactive customers, lost customers, pricing, and more.
When it comes to information management, you have several options. You can take the traditional approach, where sales development representatives (SDRs) are responsible for the end-to-end interactions with the customers they attract. Or you can make team members who have expertise in a particular area solely responsible for those specific areas.
To ensure smooth operation, it is important that you fully integrate each member of the sales team with other members through messaging apps. These should include (at a minimum) Slack, Zoom and Google Docs. Now that so many businesses are operating remotely, there are more tools than ever you and your sales team can access to stay connected. Giving your teams the tools they need is a no-brainer. Be smart in your selection and you will soon see results in your funding rounds and in your outbound sales.
Take a test drive
Creating a minimum viable product (MVP) is crucial for any business, especially one that is still trying to find its footing in the market. Before you dive in and do a full launch (and possibly decimate your bank account), you need to have a clear idea of the public’s appetite for what you’re offering. So, make someone on your team responsible for building the MVP. You don’t have to be – or employ – a coding genius for this. Again – thanks to the explosion in the growth of software to accommodate remote working – you have a wide selection of tools to choose from that will enable the creation of MVPs quickly and efficiently.
Know your CLVs
Getting customers is only half the battle: you want them to come back. You have to spend money to acquire new customers and retain existing ones, but keep this in mind: the former costs about five times as much as the latter. If there’s one metric you need to master, it’s customer lifetime value (CLV). Customer lifetime value can help you predict future revenue and gauge long-term business success.
How is CLV calculated? The formula is quite simple: multiply the average order total by the average number of purchases, then by the average retention time in years. The CLV metric is a good predictor of the profit your business can expect from a typical customer throughout your relationship with them. Equally important: it helps you estimate how much you need to invest to retain the customer.
Of course, the amount you should invest will be determined by your margins. One business may spend less than $1 to retain a customer, while another may spend up to $50. To determine how much you should invest, you need to know your company’s customer lifetime value metrics. As a rule of thumb, customer lifetime value should be at least three times your customer acquisition cost (CAC). So if you spend $100 on marketing to acquire a new customer, that customer must have a minimum CLV of $300.
Obviously, the longer you retain your customers, the more value they will bring to your business. So it’s important to focus on increasing CLV by building on your baseline metrics, including:
- Average CLV: The average total orders, multiplied by the average number of purchases in a year, multiplied by the average retention period in years. This provides the average lifetime value of a customer based on existing data.
- Average Order Value (AOV): The higher your AOV, the more you earn from each customer – and the more you get out of every dollar you spent to acquire that customer. This will help you evaluate your pricing and online marketing strategies. It gives you the information you need to assess the long-term value of each customer. When you improve your average order value, you improve long-term profit and revenue growth. Studies show that customer engagement tools like chatbots can increase AOV by up to 17%.
- Repeat Purchase Rate: The proportion of customers who have made multiple purchases from your business. These are the people you want to target. Studies suggest that 28% is a healthy rate to aim for.
In the long term, your success will be based on retaining your customers and improving their value by retaining them. How? ‘Or’ What?
- Create a customer loyalty program offering points as incentives
- Provide bundles and bundle options
- Cross-selling complementary products
- Sell your products
- Offer limited-time promotions
- Encourage loyal customers to refer your business to their network.
- Reach out to customers regularly to maintain contact and let them know they are valued customers
Don’t expect results overnight. It will take time for you to find your place in the industry, generate income and be able to count on a stable income stream. So plan strategically, know how to market your product and reach your customers – and build a team that can support your efforts. When you can plan a few months ahead, you’ll be able to grow your team — and they’ll have the tools to help you grow your business.
Updated on January 11, 2022 at 3:40 p.m.
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