Lab: Treat your best prospects differently

Once you’ve built your Sales laboratory, you can perform all kinds of experiments in order to find and test ways to improve your sales productivity.

At first you will most likely start experimenting with a single dimension (one of the Five Sales Lenses) — Channels, Customers, Products, Process or Reps.

You pick a dimension (let’s say Channels), come up with a new option for that particular dimension — e.g. a new marketing channel, different from the existing channels — you trial it out, monitor how well it’s doing and if it’s successful you roll it out.

But the fun doesn’t have to end there. You can also use combinations of the dimensions for your experiments. And these combination can lead to even greater opportunities as some options might be too expensive to roll out across the whole business and you might need to narrow down the scope which is what you can use the secondary dimension for.

Here is an example (a combination of Customers and Process) — let’s say you’ve identified a highly lucrative customer segment that’s generating a lot of value for your business. You believe that if you took these prospects through a personalised and more intensive buying process you might be able to convert much higher percentage of these prospects.

This is a great example of the combination of dimensions. Let’s say that this new process is much more costly for you, let’s say 10 times more expensive than the current process as it involves more time of your sales reps, personal meetings, special events etc. There is no way you could implement this process for all your prospects but let’s say these highly lucrative prospects are only 1% of all your leads and they deliver 10–100x higher value than your typical customers, so if the hypothesis works and you indeed manage to convert more of them, this might pay off handsomely.

Now, in order to evaluate whether an experiment works it is important to set it up correctly and plan it how to measure it and what will serve as a control group.

How to measure the results

In this particular example we would look at conversion rate, average order value, profit and sales cycle length. However the primary metric would be ROI (return on investment) — because the new process is more costly, we need to take that into account and deduct the expenditure from the profit generated to get a clear picture of how well is the new way performing.

Control group

In order to reliably evaluate the experiment we need a comparable control group — ideally one which has got everything else exactly the same and the only thing that differs is the process we take the prospects through.

So firstly, we need to ensure that a statistically significant part (it could be a 10% or 20%) of those highly lucrative prospects follow the new test process and the rest follows the existing process.

Ideally the two groups would be run by sales reps with a similar level of skill so the skill doesn’t skew the results much. However you want creative, agile and change loving sales reps in your test group because there will be a lot of trial and error and they need to learn quickly. Picking people who find that challenge exciting is the first step towards success.

Other than that the test of course needs to run for a meaningful period of time so you are able to evaluate it with confidence.

Few more tips:

• Set a specific success target upfront. When would you consider the experiment a success? And what would happen next? And at what level would you view it as proven unsuccessful? There might be a grey area in between which might be a subject to a decision post the experiment and can possibly lead to a tweaking and rerunning of the experiment.
• Use maximum of two dimensions, more than that would probably too complex and might be difficult to clearly evaluate. Instead of that you might want to run two simpler experiments.

Summary:

Having a Sales laboratory gives you great power to continuously drive better sales performance and it helps you engage employees who love change and continuous improvement. Often these are your top performers and if they get bored they might start to look for a new challenge. Giving them the keys to the laboratory can make them much more interested, engaged and excited.