Evidence from past economic downturns suggests that leaders who quickly assess and then decisively act will best position their company for success. But what are the critical assessments and actions that sales leaders should make in their ongoing B2B sales strategy?
Become versed on economic principles (inflation, stagflation, recession). In addition, understand the financial impacts of these economic conditions on business. For example, high demand and tight supply push prices higher. Consider this basic guide from the International Monetary Fund to share with your team.
Assess the following areas of the B2B sales strategy and plan. Determine if change will be positive, neutral, or negative because of economic pressure.
Identify and prioritize the buyers who are most likely to purchase now. Don’t forget, however, to identify those buyers who can’t buy now but will once the economy recovers. These buyers must be nurtured in the meantime.
- Buyer segments. Are any segments more vulnerable to decline in spending by consumers and other buyers? Consider especially those that may not have recovered from the pandemic.
- Buyer response. Consider how buyers may respond to smaller or frozen budgets. Will they:
- Cancel contracts or subscriptions?
- Decrease utilization of services?
- Delay spending? Or cancel projects completely?
- Seek financial assistance with critical spending?
- Customer engagement. If your offerings are priced based on usage, consider how customer behavior may affect the number of users. In addition, will the number of interactions that they’ll have with your platform be affected?
Work with product leadership to assess the following components of your offerings. Also, capture input from your sales team to understand how buyer needs are changing. Incorporate changes into your B2B sales strategy.
- Product mix. Do you have the offerings that will meet buyers’ immediate, near-term, and longer-term needs?
- Product packaging. Perhaps you have the offerings, but consider if they need to be packaged differently. For example, do buyers seek an entry-level, freemium version?
- Revenue and profit. Given changes in buyer response by segment, how will this potentially affect purchasing of products? Existing and future revenue? Profit?
Once you and your peers have assessed the market landscape and your ecosystem, take action. Incorporate immediate actions into existing sales plans and future required actions into your B2B sales strategy.
As with all changes that affect our teams, we must take a leadership role. For example, we must treat economic downturns and the changes that we have to make as a comprehensive change program. As usual, this starts and continues with communication.
- Communication. When economics impacts our business, our teams and those within our partner ecosystems need reassurance about the future of the company. In addition, they need reassurance of their personal futures. Share executive team views on the market. Communicate the results of any assessments that have been made and actions that are planned.
- Care for your team. Managers must ensure that open and transparent communications are available. Continue to appreciate and recognize employee efforts during what could be a challenging time. A culture of appreciation drives employee engagement and productivity.
- Budget. Although sales does not have tremendous discretionary budget, it goes without saying that leaders must reduce all unnecessary spending, including travel, and consider hiring freezes where appropriate.
Position resources toward the market priorities that will drive the best current and future results. For example, some industries such as healthcare may be more recession-proof than others.
- Demand engine changes. Shift marketing spend to appropriately drive demand in target segments and nurture those that will be poised to act when recovery occurs. Share six tips marketing operations leaders can use to prepare for a potential recession with your marketing partners.
- Digital routes to market. Consider how buyers may be changing their purchasing behavior. If, for example, they desire self-service, consider if now is the time to invest in digital selling capabilities. Doing so can meet buyer needs and reduce human sales expense.
- Seller enablement. Educate direct and partner sellers on new messaging, offerings, packages, etc. In addition, coach them to ensure that they can effectively leverage these resources.
- Coverage and quota. Shift coverage to ensure that existing and targeted priorities are effectively covered. Consider changes to quota or incentives to drive action to the highest-potential opportunities and clients. Also, consider how quota or incentives may have to be adjusted if existing targets are no longer achievable.
A critical priority is to retain the customers you have. Therefore, take steps to ensure that you are able to create the relationship and value needed.
- Value selling. Ensure that sellers can map and communicate the value of solutions and offerings to the highest priorities of the customer. In addition, coach sellers to educate buyers and provide value along the entire buying process.
- Customer value. Focus resources to ensure that existing customers have strong, positive experiences. In addition, help them to quantify the value that your solution provides them.
- Customer appreciation. Create or update customer appreciation programs that enable customer-facing teams to surprise and delight customers.
- Customer renewal. Educate direct and partner sellers on changes in renewal or financial terms to support customers, especially those that need/want to continue utilizing your service but may be impacted by budget constraints. Remember to coach sellers to effectively use these.
Sales often sees changes to buyer needs first. Therefore, sales leaders must identify key buyer needs during economic downturns, so share these insights with product and marketing leaders. In addition, work with them to create changes to offerings to better meet buyer needs.
- Product and packaging. Consider freemium or base-level packages to help buyers who can’t purchase now but could realize value in the short term and support the promise of future revenue when markets recover.
- Financial terms. Define any changes in financial terms for existing customers and future buyers.
As with all difficult economic times, we must reduce spend and take care of our teams and our customers. Therefore, assess and take action to create a strong platform from which to rebound as the economy recovers. An effective B2B sales strategy and planning can drive the right path forward.
This post was written by VP, Principal Analyst Nancy Maluso and it originally appeared here.