The Future of
PIPELINE GENERATION
CONTENTS
Introduction 03 Chapter #1: A Quick History on Pipeline Generation
04
Chapter #2: What is the Future of Pipeline Generation?
07
Chapter #3: Your Pipeline Team
10
Chapter #4: Your Pipeline Strategy
12
Chapter #4: Clear Responsibilities 14 Chapter #5: Ideal Customer Profile
16
Chapter #6: Pipeline Coverage 18 Chapter #7: Messaging & Campaigns
22
Chapter #8: Personalization vs Automation
26
Chapter #8: Where Do You Go From Here?
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INTRODUCTIOn With an unlimited amount of prospects in the pipeline, every sales team in the world could hit their revenue goals. While the idea of unlimited pipeline sounds outrageous, smart sales and marketing teams are unifying around a common goal of a pipeline coverage of 4x to 6x. Everyone seems to have an opinion on how to generate pipeline from cold emailing, to calling, to content marketing. There are hundreds of software platforms to invest in from marketing automation to sales development tools. In order for any of those investments to work you have to start with the basics and make sure you have a cohesive strategy in place. In this ebook, you’ll learn three clear steps to creating a pipeline strategy that delivers consistent results while adopting the best configuration for your pipeline generation discipline.
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CHAPTER
1
A Quick History on Pipeline Generation When it comes to B2B pipeline generation, or lead generation, or in some organizations what sales refers to as “that thing marketing does”, the principles have always been the same: find buyers that fit our ideal customer profile and get them to a meeting so that salespeople can educate and sell to them.
4
Over the past 15 years, B2B sales and marketing organizations have gone through vastly different models of pipeline generation. They include:
1.1.
Marketing provides the leads, sales closes them. This is probably the oldest and most tried and true form where marketing has a humming demand generation machine through events, webinars, content and digital advertising which attract target buyers which then gets passed to sales to do their magic.
2.2.
Marketing provides leads, but sales have to prospect to fill the gap. Obviously, not every organization is perfect. Companies often found friction between marketing and sales because the “leads were terrible” and so sales leaders tasked their salespeople to prospect into their own territories and generate their own pipeline while closing business.
3.3.
Marketing focuses on branding, messaging, content and some demand generation, but sales build out a dedicated prospecting team to focus on generating pipeline. This was originated in companies like salesforce and Responsys in the early to mid-2000s where sales development organizations living under sales were tasked with generating opportunities. The primary driver for this was sales wanted very specific target accounts of a certain fit and size to go after to ensure they were creating pipeline that was likely to close.
5
Now, most of the B2B world today falls under one of the three models described above. In fact, when taking all possible B2B companies into consideration, only a small amount of companies actually has sales development organizations, so approach #3 is still considered “cutting edge” or even a “luxury to have” for most companies. All three of the approaches above have their pros and cons and are inherently still flawed. In the next chapter, we’ll walk through a new hybrid model emerging that aligns both sales and marketing and ensures a better outcome for B2B sales and marketing organizations in their ability to hit their revenue goals.
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CHAPTER
2
What is the Future of Pipeline Generation? There are a number of inherent flaws in the way pipeline is generated today. When talking to sales leaders, qualified pipeline that is likely to close is always a top concern. The underperformance of a pipeline generation strategy manifests itself in low win rates, inability to achieve quota, and ultimately the failure of the VP of Sales. When digging in, the problem is simple: Not enough of the right pipeline constituting the right buyer and the right deal size. But why? What are the root causes for these problems? Why do companies consistently struggle to
But why? What are the root causes for these problems? Why do companies consistently struggle to generate sufficient pipeline and the right pipeline?
generate sufficient pipeline and the right pipeline?
7
The three key root causes are the following:.
1.
MARKETING AND SALES DO NOT HAVE A CLEAR DEFINITION
3.
MARKETING AND SALES DON’T HAVE A CLEARLY ARTICULATED
OF THE TYPE OF BUYER THEY
STRATEGY ON HOW TO ENGAGE
SHOULD BE TARGETING.
WITH THE TARGET BUYERS.
Which industry? Which sector? What
It’s simple, right? Host a couple of
is the ideal company size? What are
webinars, run some ads and send some
complementary investments that an
automated cold emails every 3 days.
ideal customer has already made?
Wrong. Activities don’t necessarily
Who is the right set of decision
result in quality pipeline and results.
makers to target?
Often times, we’ve seen companies go through the motions of “doing”
2.
MARKETING AND SALES HAVEN’T
marketing and sales development but
DEFINED A CLEAR SET OF
not succeed because they didn’t have a
RESPONSIBILITIES.
thoughtful strategy.
How much pipeline coverage is needed? Who is responsible for it?
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8
THE FUTURE OF PIPELINE GENERATION TAKES A BRAND NEW APPROACH TO GENERATING PIPELINE. IT IS AN APPROACH WHERE: • Marketing and sales create a unified pipeline team to own “pipeline coverage” just like you would own “the number.” • Marketing and sales use sophisticated tools to define an ideal customer profile and a way to smartly engage with target buyers through well thought out marketing and sales campaigns. • Instead of hiring armies of SDRs to cold call, this pipeline team is an elite team of content creators, copywriters, strategists and a few SDRs to strategically engage with customers at scale using best of breed software over email, phone, social media and physical events.
The future of pipeline generation blends the discipline of sales and marketing. Instead of artificially driving “alignment” which rarely works, the Pipeline Team is a truly elite team that blends the best of both worlds. The future of pipeline generation does more with less, generates the right pipeline composed of the right target buyer, and leverages software to drive scale and personalization. In the rest of this book, we’ll walk you through how to assemble this team, craft your strategy, watch the right metrics, and become unstoppable in generating the right pipeline for your revenue organization.
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CHApter
3
Your Pipeline Team WHETHER PIPELINE GENERATION IS OWNED BY MARKETING, SALES, SALES DEVELOPMENT, OR A HYBRID TEAM, THESE ARE THE KEY THINGS THAT TEAM IS RESPONSIBLE FOR: • Defining your ideal customer profile • Articulating a clear strategy to identify those buyers • Target those buyers through inbound and outbound strategies • and then, in a meaningful way, engage with them to create opportunities Have you done all of those things as part of your pipeline generation strategy? Be honest. And, it’s okay if you say No. Because most people haven’t. In fact, when most people look at that list, they almost always hit a state of pause. “Wow. That’s a wide-ranging list.” And the biggest caveat of all is that this can’t be done by only Marketing or only Sales in a vacuum, this needs to be a concerted effort that aligns the entire company. Here’s the thing. It’s very easy to invest in a ToutApp, or a Marketo, buy a list, build a database, and start cold calling and emailing while you invest $15k a month on a digital advertising agency to market your product. That’s easy to do, requires a bunch of meetings to make happen, and can feel great. Will it result in sound pipeline? Probably not.
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The thing that most sales and marketing leaders overlook is the wide-ranging set of skills and abilities required to clearly articulate a pipeline generation strategy and run a pipeline team.
THE TEAM OWNING PIPELINE GENERATION NEEDS TO BE STAFFED ACCORDINGLY TO BE ABLE TO DO ALL THE THINGS LISTED ABOVE. THIS USUALLY MEANS THE BEST PIPELINE TEAMS ARE COMPOSED OF: • The sales leader and the marketing leader who are the keepers of the strategy • A data analyst or a sales operations expert that can clearly help identify your best and ideal customer profile and help set up the systems to tie it all together • A content strategist that can help define the communication and messaging strategy • A content creator/copywriter to help communicate the right message • An army of outside workers helpers who can help you build a database of target customers with full contact information (or buy it from a company directly) • A small group of seriously smart SDRs who can leverage the messaging, content and strategy and go after your target buyers in a meaningful way It’s important to recognize that you don’t need an individual for each of the items above. You just need someone that can own one or more of those roles. But if you are able to successfully assemble a team of people that can fill each of those facets, you’ve got the essentials for an unstoppable pipeline generation strategy.
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chapter
4
Your Pipeline Strategy When you’re thinking of achieving a goal, I like to approach it as if you’re about to approach a bank heist. You need to build a great team, you need to do you research, you need to meticulously plan, and then you need to execute. All of those things make for a brilliant strategy. It shocks me how many leaders go in blindly into generating pipeline without a clear and cohesive strategy in place. In the rest of this book, we’ll walk you through how to develop and execute on your strategy However, this chapter needed to exist. It needed to exist and is purposefully short, to reiterate the fact that you need to be purposeful and thoughtful about a clear and articulated strategy that both sales and marketing understand on how you will generate pipeline.
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THE CORE REQUIREMENTS FOR A WELL-DEFINED PIPELINE GENERATION STRATEGY MUST INCLUDE:
Clear responsibilities
Well articulated
Well articulated pipeline
on who is responsible
ideal customer
coverage requirements
for what (Chapter 4)
profile (Chapter 5)
(Chapter 6)
Clearly defined
Well articulated strategy on how to engage with your
messaging and assets
target buyers with the right mix of personalization and
that the ideal buyer will
automation (Chapter 8)
appreciate (Chapter 7)
The foundation of a pipeline strategy is understanding your goals, your buyer, and your approach. You can start to see those three things take shape in the chapters ahead.
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chapter
4
Clear Responsibilities If you can’t measure it, you can’t improve
The sales leader lives and dies by the
it. If you don’t have a clear owner, then no
number. Similarly, there needs to be a single
one will have enough respect to care about
person that lives and dies by the Pipeline
it. You can have anything you want, but you
Coverage number and the team’s strategy,
can’t have everything; so you better know
execution and ability to hit that number.
what you want.
When you have one single person owning it, he or she will ensure they’re thinking
I can’t add any more clichéd quotations
about it day and night, and that there is true
about ownership and responsibility to drive
alignment across the revenue organization
home the point that pipeline generation,
on making sure the pipeline goal is hit.
pipeline coverage, and quality of pipeline needs to be owned by one single person
Even the best sales team in the world will fail
that lives and dies by it.
without the sufficient pipeline to help feed them. So, declare a clear owner.
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FOR TOUTAPP’S CUSTOMER BASE, WE’VE SEEN IT DONE IN DIFFERENT WAYS. WE’VE SEEN: • A sales development organization being owned by sales • A sales development organization being owned by marketing • A hybrid pipeline team with sales and marketing co-owning it but with a well-defined pipeline or sales development leader Again, the choice depends on the strengths and weaknesses of your organization. The most important thing is that you have a clear owner.
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chapter
5
Ideal Customer Profile Who is your best customer? Your best customer is usually a combination of the one that pays the most, is an absolute pleasure to work with, and has such strategic alignment with the value you provide - they’ll never leave you. Your job as the leader of the Pipeline team is to find a thousand more customers that look just like your best customer. It is incredibly easy to buy generic lists, databases, or spend money on companies that promise to give you a “fresh” database of contact information. All of that would be easy to do but won’t necessarily guarantee your success.
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To build a meaningful ideal customer profile, here are the key questions you should identify:
1.1. 2.2. 3.3.
Which industry are our best customers in?
6. 6. What internal trigger events drove the same buying decision?
What size company are our best customers? What type of technology investments have
7. 7. Which area of the business did the budget
our best customers already made that are
8. come from when our best customers decided to purchase from us?
complementary to our offering?
4.4. 5.5.
Who are the key positions at our best customers
9. 8. Is there variation in how long it took us to
we interacted with to get a deal done?
close the deals with our best customers?
What external trigger events drove the decision
Which ones took less time? What made
for our best customers to purchase from us?
some take longer?
As you answer the questions above, you’ll be able to define a model that helps you clearly articulate your ideal customer profile and who you want to go after. If you can tether yourself and your organization to a clear profile, it will help drive all other important decisions; from building a database, to targeting the right set of accounts, to defining the right messaging to engaging with your target accounts. It is important to recognize that you’ll never be perfect in determining and defining your profile. But that doesn’t make it okay to operate without one. Do the best you can with your team to define a profile with the data points available to you and then iterate it over time.
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chapter
6
Pipeline Coverage You’ve got the right team in place. You’ve got clear ownership on pipeline. Now you’re at the helm and you need to generate pipeline. But how much pipeline do you need? It’s one thing to “generate as much pipeline as possible” but it’s a whole another thing to apply extreme thinking and have a clear structure around how much pipeline you need to deliver. Fortunately for all of us, there is clear math in place to help sales and marketing teams figure out as exactly how much pipeline you need to deliver to ensure your revenue team has a standing chance at delivering on their revenue goals. It all comes down to Pipeline Coverage.
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Figuring out your coverage model is key to creating a consistent strategy, so at the end of the day you can hit your number. You often hear about a standard 3x coverage model but depending on your close rate, how much you want to grow your business and your sales cycle – your model could be wildly different. Use the
Pipeline Sales Forecast
Avg SalesDays
90 Days
1 Close Rate
Image Source: Storm Ventures
equation below to uncover your pipeline target.
Did you get all that? It’s okay. We didn’t get that either when we first saw it but when you actually break it down, it all makes a ton of sense. The sales leader in an organization has a number to deliver on THIS month. And then NEXT month. And then the quarter after. To add to that, your sales team has a track record of closing a certain percentage of deals that enter the pipeline (Your Close Rate) within a certain amount of time (Avg Sales Days). When you factor in these key characteristics, you get a deeper understanding of exactly how much pipeline you need to ensure based on your sales team’s track record of closing deals and the complexity of your sales cycle, you have sufficient pipeline to give them a standing chance.
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The chart to the right visualizes
Desired Pipeline Coverage Ratio
the desired pipeline coverage pipeline days ranging from 30 days to 270 days, and pipeline close rate ranging from 20% to 40% with 30% being “normal.” As
16.00
Pipeline Coverage Ratio
ratio for the first two variables:
background, Aberdeen reported an
14.00 12.00
SQL to Win
10.00
Close Rate
8.00
20%
6.00
30%
4.00
40%
2.00 0
average SQL to win business close
50
100
150
200
250
300
Average Sales Cycle Days (SQL to Win)
rate of 29.0% and best in class close rate at 45%.
SQL to Win Close Rate
The same analysis is shown in the
Ave Sales Days
table to the right.
20%
30%
40%
30
1.67
1.11
0.83
60
3.33
2.22
1.67
90
5.00
3.33
2.50
120
6.67
4.44
3.33
180
10.00
6.67
5.00
270
15.00
10.00
7.50
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The desired pipeline coverage ratio ranges from 0.83x to 15.0x. A pipeline coverage ratio of 3x works with a 33% close rate for 90-day deals. Coincidentally, a 33% close rate for 90-day deals is fairly common. That explains the rule of thumb. But, the rule of thumb obviously does not apply in all scenarios. Companies should use the pipeline coverage formula with their own numbers. Needless to say, no matter what you do, make sure you all get aligned on your pipeline coverage goals and do everything you can to drive to it and measure against it. This will most likely be the single biggest predictor of
"
...no matter what you do, make sure you all get aligned on your pipeline coverage goals and do everything you can to drive to it and measure against it.
the success of the business.
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chapter
7
Messaging & Campaigns Being thoughtful about your messaging and the type of campaigns you run is the next thing you will need to focus on. There are two components to this step – the Logistics and Content.
Logistics:
Content:
Inbound v Outbound? # of Touches Duration Channel
Find the common thread to make it relevant and ensure it resonates
Remember, there’s no silver bullet to pipeline strategy because every business is different so your logistics and content will vary.
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The Logistics HERE ARE TWO EXAMPLES:
SITUATION #1:
SUGGESTED APPROACH:
High Volume of Inbound
Leverage an automated sales campaign with calls
Leads, Low ASP
early on and consistent emails over the course of 3 weeks. If you get no response after that, you can put them on an outbound sales campaign.
Day 1
Day 2
Day 3
Day 4
Day 7
Day 14
Day 21
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The Logistics SITUATION #2:
SUGGESTED APPROACH:
70% of pipeline comes
Create a Strategic Outreach Campaign with a mix of
from outbound sales
Semi-Automated email touches and hyper-personalized
efforts, High ASP
email tasks. Leverage LinkedIn Sales Navigator to add 20% personalization to the email tasks. This approach allows your team to apply the same rigor to their outreach, every time, with a hyper-personalized touch that will resonate with a strategic buyer.
Day 1
Day 3
Day 7
Day 13
Day 16
Day 17
Day 21
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The Content The key to creating effective messaging and campaigns that deliver results is defining the bucket you are going to reach out to, so the messaging is relevant and specific enough to their challenges, goals, persona, and industry. Think outside the box – everyone talks about an ICP but that is not always enough to make a message relevant. What is happening in your prospects’ world that connects to the value you provide? Stay on top of industry specific news that makes noise within that category and Analysts reports such as the Gartner Magic Quadrant & Critical Capabilities reports as a launch pad for creating tailored prospecting messaging.
Here’s a checklist of the components you should think through when creating your messaging and campaigns. 1. What’s the messaging by persona? 2. How many touches? 3. What kinds of content can we leverage? 4. Which channels? Where are they living? 5. Automated and Manual mix 6. Sprinkle in “Custom Tasks” (for example, if you are a user based SaaS application, check for past or previous action in your product)
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chapter
8
Personalization vs Automation To define a strategy that is going to deliver pipeline for your business, you need to decide on how to approach your target segment(s) based on the complexity of your sale’s cycle and the buying process of your customers. The key questions below will help you decide how to approach your target segment(s) of prospects.
Is the makeup of our pipeline primarily inbound, outbound or a hybrid? IF YOU ARE A HYBRID YOU WILL WANT TO ASK THE QUESTIONS BELOW FOR BOTH INBOUND AND OUTBOUND BECAUSE THE ANSWERS CAN YIELD A VERY DIFFERENT APPROACH. • If you are primarily outbound focused, a complex buying process with multiple stakeholders and a high ACV – You can spend the time to hyper-personalize your outreach. • If you are primarily inbound focused, with a more transactional sale you have a larger volume leads at your door with a lower ASP to automate.
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What is the complexity of our sales cycle? The buying process, who you sell to, the
Enterprise
Transactional
number of stakeholders, ASP, and your sales cycle are all inputs into developing your pipeline strategy.
What is our communication strategy to map to the buying process? Think about communication strategy on a spectrum of completely automated to highly personalized. You’ll want to think beyond certainties with your approach. Some of the best strategies
Personalization
Automation
use an approach that spans across the completely automated to highly personalized spectrum. The thing to think about here is – where can I afford to use hyper-personalization and where should I automate because the payoff is not there?
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Here’s an example for a heavily focused outbound account based model, where your entire sales team or a segment of your reps are focused on the Enterprise market, have a small target list of accounts, multiple stakeholders and a longer strategic sales cycle. Marketing generates a steady flow of inbound leads, typically from Lower Level Personas in target accounts.
(Outbound) Lower Level/ End User Personas Tier A Accounts
Sales Complexity
Enterprise
(Outbound) Key Stakeholders/ Decision Makers Tier A Accounts
(Outbound) Tier B Accounts or Your Not Ready to Buy Now
(Inbound) 'Downloaded Analyst Report' Lead from Lower Level Personas
Transactional
Communication Strategy Automation
Personalization
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The strategy plotted
If you have a daily flow of
You may have a small
on the grid automates
inbound leads for lower
target list of accounts and
communication for the
level personas, you know a
a number of those are
outbound lower level
lot more about these buyers
Tier B accounts or even
personas, such as end
such as they Downloaded
accounts that are not ready
users in order to focus
an Analyst Report or are
to buy now that you want
strategic, personalized
trialing your product, where
to keep warm – use semi-
communication with key
automation will allow reps
automation here.
stakeholders and decision
to consistently follow
makers when targeting
up with hand raisers, but
Tier A Enterprise accounts.
won’t compromise their productivity.
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Where do you start? Now that you’ve thought about how to approach your target segment(s), where to you start? Do you create the messaging and campaigns for those inbound leads or focus on the outbound prospecting messaging for your Enterprise team?
Here’s our advice when it comes time to execute: FOCUS ON THE TARGET SEGMENT THAT
WHAT IS MOST FEASIBLE? ALREADY HAVE
WILL HAVE THE BIGGEST IMPACT ON
AN INITIATIVE IN PLACE, MESSAGING,
YOUR BUSINESS!
CONTENT OR RESOURCES ALLOCATED TO
• Let’s say increasing ASP will have the biggest impact on your business, you may prioritize focusing on your outbound Enterprise segment. • On the flip side, increasing your pipeline quantity is important and you already have a large number of inbound leads knocking
A SEGMENT? START THERE. • You already have inbound leads knocking at your door • You have an ideal customer profile and target prospect list • One of your objectives as a company is breaking into a new market
on your door, you may prioritize focusing on your inbound lead segment.
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chapter
8
Where Do You Go From Here? The book is purposefully built to help you think strategically about generating pipeline, create the right organizational structure for your pipeline team, and you define a thoughtful strategy for generating pipeline. Once you have your team assembled, you’ve got the right responsibilities defined, and you’ve got the right pipeline coverage, messaging, and automation vs. personalization strategy defined, you now need to execute on it like you’re pulling off a bank heist. A critical component to every pipeline team is to have the right software platform that enables them in executing on a cohesive personalized and automated pipeline generation strategy at scale. This is where ToutApp comes in.
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ToutApp allows your pipeline team to execute on your inbound and outbound pipeline generation strategy with the best messaging, content and cadence while allowing you to measure the right metrics and ensure that you are on track. For more information please visit www.toutapp.com
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