All You Need To Know About Sales Strategy
Table of contents
- What is a sales strategy?
- What are the benefits of a sales strategy?
- What are the different types of sales strategies?
- How do you develop a good sales strategy?
- Step 1: Analyze your target market
- Step 2: Identify business levers
- Step 3: Define business objectives
- Step 4: Implementing the sales strategy
- Step 5: Evaluate results and feedback
What are your business objectives? How will you achieve them? These are the questions you ask yourself all the time, whether you are starting your business or have been running it for years. For this, it is important to set up a sales strategy.
What is a sales strategy? What are its benefits for companies? And how to set up an efficient sales strategy?
In this guide, we explain the basics of developing a sales strategy. We’ll cover every aspect of it while giving you actionable tips; from defining your goals to creating a roadmap to achieve them.
What is a sales strategy?
By definition, a sales strategy is a set of decisions and actions that aim to achieve the business objectives set by a company.
This notion is to be distinguished from the “business plan” which is used to designate the file of your sales planning to be drawn up when you want to create a company.
A sales strategy allows you to determine the actions to put in place to attract and retain customers, as well as to sell their products or services.
It is concerned with factors internal to the company such as:
- Human resources (especially in the sales department)
- The budget allocated to sales prospecting
- The efforts made in marketing and communication
- Customer base
- Company’s history of sales performance
It also looks at factors external to the company – from its environment – such as :
- Economic conditions (purchasing power, growth, legal framework, etc.)
- Your target and their behavior
In essence, the sales strategy is both a retrospective of what has been done, but also – and above all – a projection of what should be done in the next period.
To be effective, the sales strategy must therefore answer the following questions:
- What are my business objectives?
- Who is my target market?
- Which actions should I take to reach my goals?
- What are the indicators I need to follow to know if my actions are effective?
- How many follow-ups should I include in my strategy?
- When and how should I adjust my sales strategy?
The implementation of a sales strategy is therefore crucial for any company that wishes to grow in a sustainable way. Without a clearly defined strategy, it is very difficult – if not impossible – to reach your sales objectives in your sector of activity.
Who sets up the sales strategy?
The sales strategy is drawn up by the company’s director or the sales director of a business unit.
However, it must be approved and shared with everyone involved in its deployment. The entire sales department will then implement it.
What are the benefits of a sales strategy?
As we saw earlier, the sales strategy is at the heart of the company’s development.
It must determine the actions you need to take to attract and retain customers, as well as to sell them your products or services.
A well-developed sales strategy can therefore accelerate the company’s sales development and significantly increase its turnover while reducing its sales costs (prospecting costs, customer relations costs, etc.).
Here are some of the advantages of implementing a good sales strategy:
- Increased sales
- Improvement of profitability
- Attracting new customers
- Retention of existing customers
- Reduction of sales costs
- Optimization of human and non-human resources.
As you can see, the benefits related to the sales strategy are very high, whatever your business. This is why it is crucial to take the time to think about your strategy before launching into the implementation of sales actions.
A company’s sales strategy must be developed in such a way that it is consistent with the company’s overall business strategy. Indeed, it is useless – and even dangerous – to implement a sales strategy that is not aligned with the company’s global objectives. Even though in most cases, the sales objectives are higher from period to period and aim to drive the company forward.
What are the different types of sales strategies?
There are different types of sales strategies, depending on the objectives you wish to achieve. Here are some examples of sales strategies:
- The conquest strategy: This is an aggressive strategy that aims to quickly increase sales by attracting new prospects. This strategy is often adopted by companies in the launch phase or a period of strong development. It aims to acquire the maximum number of sales leads with the best ROI.
- The loyalty strategy: This is a more passive strategy that aims to manage and retain existing customers. You usually find companies in the consolidation phase adopting this, or when they already have enough market share.
- The mixed strategy: A strategy that combines the two previous ones, i.e. the pursuit of new customers and the retention of existing customers. This strategy is often adopted by companies in a growth phase, already well established in their sector.
- The challenger strategy: This is another aggressive strategy whose objective is to dethrone the leaders in a given market. Like the conquest, this strategy is often for businesses in their launch phase or in a period of strong development. It consists of breaking the leader’s offer through lower pricing or a differentiating element in the product.
- Niche strategy: This one consists in focusing on a specific market and developing an adapted offer for it. This strategy is often when they have identified a promising market with little competition.
There are many other business strategies, but these are the most common. Of course, you don’t have to limit yourself to just one of these business strategies, you can draw inspiration from what exists and do something according to your market and your objectives.
How do you develop a good sales strategy?
This is probably the question that has been nagging at you the most and has brought you this far, so let’s get to it!
In order to build an effective sales strategy, it is necessary to follow a precise methodology, otherwise, your battle plan could be flawed.
For this, we, at LaGrowthMachine, suggest you observe this standard step-by-step plan and adapt it to your specific needs when necessary.
Step 1: Analyze your target market
The second step consists of analyzing your target market, i.e. determining how your business environment behaves. It focuses on studying the following elements:
- Cost of raw materials
- The catchment area
There are interesting methods for the market research phase, notably the SWOT, Porter’s 5 forces, and PESTLE methodologies, all three of which focus on the micro- and macroeconomic environment, which are essential to a good understanding of your business sector.
Step 2: Identify business levers
The third step consists in identifying the sales levers you to implement to reach your objectives. These levers are often linked to the 4Ps of the marketing mix: Product, Price, Promotion, and Place.
Choosing the right sales levers will determine the success of your sales strategy. The questions to ask yourself during this phase are:
- What is my value proposition?
- What is the psychological price of my product or service?
- The best distribution channels (online and offline)?
- The best communication levers (online and offline)?
During this step, you must also take into account the inventory of your internal resources, including:
- Financial resources
- Human resources (number of salespeople, skills)
- Infrastructure (managerial organization, access to training, work time, telecommuting, computer equipment, sales prospecting software, etc.)
At this stage, we would recommend that you call on your marketing department to study your positioning, your means of action, and the information you have at your disposal (market research, current operations, brand studies, etc.).
Similarly, during this phase, you should consider using sales automation software such as LaGrowthMachine, which will allow you to:
- Save time by prospecting with proper multichannel software, with none of the arduous work associated with it .
- Save money by generating on average 3.5X more leads than with traditional methods.
Not to mention the scalability of your organization! If you want to test our tool, feel free to reach out to us!
Step 3: Define business objectives
The first step is to determine the business objectives you want to achieve. These objectives must be clear, precise, and measurable.
For a scalable, flexible, and realistic model, you should set short, medium, and long-term goals.
For example, a medium-term business goal might be to increase revenue by 20% over the next 6 months.
It is important that your objectives are SMART, i.e:
- Specific: Your business objective is clear and precise.
- Measurable: Is measured by KPIs identified in advance.
- Achievable: Must be based on your team and its skills.
- Realistic: Must be within the realm of possibility.
- Time-bound: Is set within a period defined beforehand.
Once you have defined your business objectives, it is important to communicate them to your entire team so that everyone is on the same page and knows what they need to do to achieve them.
Step 4: Implementing the sales strategy
Once the environment is understood, the sales levers identified, and the objectives set, it is time to take action and implement your sales strategy. This step consists of determining your battle plan (strategic) and implementing it (operational).
To do this, you will have to develop a sales action plan, which will be composed of the different actions you will have to carry out to reach your objectives. This plan must be precise, detailed, and must integrate different aspects of the business:
- Business development
- Customer relations
For example, if you want to increase your turnover by 20% over the next 6 months, the actions to be implemented could be the following
- Implement a marketing campaign targeting potential customers most likely to buy your products/services.
- Train your teams in sales and negotiation techniques.
- Create a loyalty program to encourage your customers to come back to you.
- Set up an effective after-sales service to generate referrals and positive reviews.
Step 5: Evaluate results and feedback
The last step consists in evaluating the results of your sales strategy, in order to know if you are on the right track or if you need to adjust some actions. This evaluation is done through different indicators (KPIs) that you will have established with your objectives in step 3.
Some of the business KPIs you can track are
- Average cart value
- Retention rate
- Churn rate
- Customer lifetime value (CLV)
Depending on the results obtained, you can (and should!) adjust your sales strategy by implementing new actions, or by stopping those that are not producing the expected results.
Sales strategies are truly the key element of a company’s success. It allows you to define your business objectives, set up a strategy to reach these objectives, and evaluate the results obtained. Following these 5 steps will help you build a solid and effective sales strategy for your company.
If you still have questions, don’t hesitate to send them to us in the comments!