Build an Informed Sales and Marketing Strategy Using the 5 Cs
So your topline sales aren’t what you expected to see. It could be a slump (yikes) or maybe even an unexplained uptick — a great problem to have, but you’d still like your analytics team to find exactly what is happening so you can formulate an informed strategy to keep the momentum going for as long as possible.
Any given business model has a nearly endless number of variables that contribute to the topline sales numbers, and their own method of measurement. So how do you know what lever to pull to stay on track to meet your goals? You need a systematic method to find the interesting bumps in the data to build your sales and marketing strategy.
Let’s start with a big, uppercase C that underpins everything — CHANGE. We’re looking for significant shifts in pivotal facets of the business. When they happen in any of these 5 Cs, they can cause huge moves in the balance sheet. The pursuit of those anomalies is critical — and often points us directly at a specific strategy and set of tactics.
1. Customer Segments
While traditional segmentation has its strengths and weaknesses, there’s no question that examining the movement of these customer groups can help illuminate disparity from topline projections.
What segments are growing, and which ones are shrinking? What is the long term trend for the recent buyer file? The time frame to define “recent” is going to vary by industry. For consumer retail, we tend to think of this as the 12-month buyer file, while if you’re B2B or service-based it may be completely normal not to see a customer for a year. The key is to look for deviations from your typical sales cycle.
The recent buyer file is pivotal for any company. Watching it grow is encouraging, but if they are slow to repurchase, or place smaller orders, you can still see a shrinking topline. A growing recent buyer file with lower frequency points to a need for a concerted strategy to drive the second purchase. This could take the form of a multitude of tactics, which might include a special offer for a second purchase, a follow-up email series, box stuffer, or all of the above!
A shrinking recent buyer file must mean that you’re seeing growth in the lapsed buyer groups, which demonstrates the need for a few things. First, following the axiom of “Learn first, react second” it’s critical to understand WHY customer are lapsing, which makes it necessary to do some research. Meaning, ask them!
You may discover a larger problem upstream, like slow fulfillment, pricing strategy, message confusion, customer service, or a bad website. Fix these problems FIRST, then map out a reactivation strategy to win back your lost customers.
2. Category Sales
Dramatic changes in certain categories could mean an industry-wide shift or it could mean that a new type of customer has found you.
For example, several years ago, one B2B client noticed years ago that a small category — not a big part of the overall picture — was growing in a striking way, doubling year-over-year. Because they identified it early, and took the time to nurture this group with special attention via a dedicated digital campaign and given space in print materials, with messaging targeted directly to them, they were able to nurture this nascent customer group into a significant portion of their customer file and an important part of their acquisition strategy.
Another company in the gardening business noticed an aberration in their flagship category — they had a sudden and unexpected growth spurt! Obviously, they were thrilled, but it was important to understand what was happening so that they could predict whether it would continue. Customer research revealed that a new group of growers had found them — marijuana farmers! California legalization had inspired a new generation of growers, all who needed gardening supplies. Similar to the first example, this knowledge gave them a whole new customer profile, along with targeted messaging and possibilities for a prospecting universe.
Originally published on BrandUnited.com October 2020