3 Fatal Mistakes Sales Leaders Make

One of the biggest challenges B2B companies face is figuring out how to grow revenue in a predictable, scalable way.

Often, a sales team will experience some early success by capitalizing on its existing relationships. But how can you keep moving the sales needle in a strong, steady way?

Aaron Ross cracked this code during his successful stint at salesforce.com, where he built an inside sales team and process that sourced $100 million in recurring revenue.

Ross identified three fatal mistakes that sales leaders make that stop them from achieving predictable, scalable revenue in his presentation at the Inside Sales Virtual Summit. You can view his thought-provoking presentation in the YouTube video below.

Here are three fatal mistakes to avoid:

1. Treating all leads alike

Ross says there are three types of leads:

• Seeds come from word of mouth.
• Nets are marketing programs.
• Spears include targeted sales prospecting and business development.

Each type of lead has a different kind of ideal customer profile. You need a different process to generate them or to follow up on them. They also have different conversion rates and financial expectations.

If you treat all of your leads the same, it will ruin your projections. For example, you might say, “We had 10,000 leads last year and made $10 million in revenue. Next year we want to double our revenue, so we need twice as many leads.” And you’d be dead wrong.

If you’ve been growing your company with a lot of word-of-mouth leads (seeds), and you try to accelerate your sales funnel with marketing (nets) and prospecting (spears), you’ll quickly find that these leads produce a much lower conversion rate. Your projections will fall apart.

By understanding these three types of leads, you can create more realistic projections and improve your sales operations and lead conversion rates.

2. Selling to the wrong prospects

The second fatal mistake that companies make is selling to the wrong prospects.

At Salesforce, Ross and his team figured out how to generate a predictable number of qualified opportunities per month. That allowed them to control how fast the company grew.

Predictability in lead generation creates predictability in revenue.

If you’re doing prospecting, it’s not profitable to focus on smaller customers. So, your ideal outbound customer should represent the largest revenue size or opportunity you can find that you can likely win.

With inbound marketing or word-of-mouth leads, you can take any size customer. But when you’re prospecting, you need to target bigger clients to be profitable.

Key Takeaway: The average order size of the companies you target with prospecting should be 5 to 10 times as large as the average size of the orders coming from inbound leads. The easiest way to grow your revenue fast and predictably is to have an outbound team in place to go after the largest potential deals in a predictable way.

3. Making salespeople prospect

A lot of companies hire teams of talented field sales reps and ask them to perform miracles. They expect them to use their contacts and their networks to find their own leads. But this is another fatal mistake.

Even if you get lucky and hire the rare salesperson who’s good at prospecting, it’s usually not sustainable.

Once they get some pipeline, they get too busy working their pipeline and closing deals, so they stop prospecting. Then, when they realize they don’t have anything left in the pipeline, they frantically restart their prospecting efforts. It creates a crazy roller coaster where they’re killing it one month and unproductive the next.

It’s not repeatable.

That’s why you need to specialize your sales roles.

If you don’t assign your employees specialized sales roles, they can’t focus. Your processes become jumbled because you have salespeople who are prospecting and closing and doing account management. If they’re not making their numbers, you can’t tell what’s going right and what’s going wrong.

When you break up these teams into prospectors, inbound lead qualifiers, closers and account management, it makes it a lot easier to see what’s working and what’s not.

By addressing these three fatal mistakes, you can propel your sales team toward escape velocity. Remember to categorize your leads appropriately, target the right prospects, and specialize your sales roles so that your closers don’t waste time and energy prospecting.

You can find Aaron Ross’ book, “Predictable Revenue,” on Amazon.

Get access to all of the information-packed presentations from the Inside Sales Virtual Summit by clicking the image below.