In a nutshell, I consider sales strategy to be "a comprehensive strategy for achieving sales objectives.
Incidentally, the difference between strategy and tactics is as follows
Strategy: A long-term plan to achieve a goal https://slimtime.co.jp/ , and the direction and actions to be taken at this point in time, working backwards from that plan (what the management and executive team should keep in mind).
Tactics: Specific methods for implementing the strategy (which can be incorporated into instructions to employees)
It can be summarized as follows.
The difference between strategy and tactics can be illustrated in a simple way.
The number of orders is increasing steadily, but the unit price per order is small and the profit margin is low. In order to achieve this goal, we need to increase the number of orders we receive from small companies by 30%.
To achieve this goal, we should reduce the frequency of visits to small existing customers by half and double the number of contact opportunities with large companies.
To put it in business terms, sales strategy is an indicator (KPI = Key Performance Indicator) to evaluate the degree of achievement of the goal derived from the goal (KGI = Key Goal Indicator), and tactics can be considered as a means to achieve the KPI indicated in the sales strategy.
Incidentally, some sales-driven companies set only a target amount of sales for the current fiscal year and say, "We can achieve the sales target if all the sales staff meet the quota. Just keep calling the people on your list! In some cases, the salespeople use forceful "tactics without strategy.
Even with this approach, there are various tactical measures that can be taken, such as internal training to improve sales talk and assigning highly skilled personnel to prospective customers who can be targeted for large sales. However, without a basic strategy, it is easy to fall into a state of "hitting the nail on the head," in which performance does not cross a certain line while resources are heavily consumed. Strategy also serves as a basis for judging tactics, leading to a reduction in the cost of tactical decisions. There is an ironclad rule in business: "No strategy, no tactics, no victory.
The first step is to create a mid-term and short-term sales strategy based on the long-term goals you want to achieve, and then develop tactics to achieve them. I think it is desirable to formulate and implement sales strategies and tactics in such a step-by-step manner. Also, adopt tactics that are acceptable to all members involved in this sales strategy.
Both strategy and tactics are concepts that originally originated from the idea of "war", or conflict, but remember that strategy and tactics in business are not only about beating rival companies and competitors, but also about achieving what you want to achieve, such as your company's philosophy and vision.
SFA can help you formulate a sales strategy.
The phrase "selection and concentration" is a key word used in the strategy of Jack Welch, CEO of GE (General Electric) in the 1980s. In the 1980s, Jack Welch, the CEO of General Electric, used the phrase "select and focus" as a key phrase in his strategy to clarify the business fields in which his company excelled and to concentrate management resources.
Professor Gary Hamel of the London Business School and Professor C. K. Prahalad of the University of Michigan, who studied how Japanese companies such as Canon, Honda and Sony were able to dominate the American market in the 1990s, published a book titled "Core Competence Management. The idea was to "understand what your unique capabilities (core competencies) are that no other company has in a competitive marketplace, and develop strategies to maximize your core competencies. To break it down a little more clearly, the question is, "What do customers pay for in your products and services? and refine it as your greatest weapon.
With this "selection and concentration" in mind, we believe that we should set short-term goals in our sales strategy, such as "what should we focus on during this period? Small businesses have limited resources, so it will be difficult for them to beat their competitors if they spread out their resources by creating an exhaustive strategy. It is important to narrow down the focus to "many things that are important, but we will focus on this one thing in particular this fiscal year.
Once you have narrowed down your goals sufficiently, you can summarize them in a few words. This is because it is important to ensure that the strategy permeates and unifies the entire organization without misunderstanding, without blurring, and without fading. For this purpose, it is preferable to include a numerical target, such as "acquire 10 new S-rank customers. This will help everyone understand what the most immediate priorities are. The purpose of creating a sales strategy is not to get employees to understand it. The purpose of a sales strategy is not for employees to understand it, but for them to understand it and then act on it. The simpler the slogan of your sales strategy, the more practical it will be and the less wasteful your actions will be.
KPI (Key Performance Indicator) is an important indicator to evaluate the degree of achievement of goals (KGI = Key Goal Indicator). Key Performance Indicators are used to evaluate and understand the current state of business and to forecast what will happen in the future. Specifically, it is a guidepost to know "how close are we to the goal set in the sales strategy? In other words, they are the guideposts for knowing "how close are we to the goal set in the sales strategy? KPIs in sales activities vary depending on the industry, type of business, sales style, etc., but generally speaking, the number of new customers acquired, sales achievement rate, and target achievement rate for acquiring prospective customers are typical examples.
By setting appropriate KPIs, you can check if your company is moving in the right direction and at the right speed. If the progress is not good, or if it seems to be going in a direction that is far off from what you expected, you should review your sales strategy and correct the course by evaluating and improving it through the PDCA cycle. To do so, constantly monitor these KGIs/KPIs over the span of the current year, current term, and current month. If possible, it would be ideal to grasp and analyze data related to KPIs on a daily basis.
Real-time monitoring of KPIs is called Business Activity Monitoring (BAM), which enables management, sales managers, and sales representatives to quickly grasp the sales situation and to quickly identify problems and incidents (events that may be signs of problems). The ability to quickly identify problems and incidents (predictive events) will help to rapidly improve the process of sales strategy and tactics.
When developing a medium- to long-term sales strategy, analyze historical data such as past customer information and sales performance to develop a strategy based on evidence. Identify basic information such as what needs exist in the customer and market, and how many orders you are getting each month, based on the data accumulated in CRM (Customer Relationship Management) and SFA (Sales Force Automation).
If you do not have these tools, it is recommended that you start by introducing them and preparing the data environment. Customer information is an important resource. Introducing a tool will not only improve operational efficiency, but also make it easier to check and analyze. CRM and SFA are both systems that are mainly used for customer information management, but they differ in the way they output customer information.
CRM is a system for management. By managing customer information in a database, multiple departments can handle the customer information, which is useful for planning business strategies. It also helps to improve customer satisfaction as it allows for an essential approach based on customer data.
SFA, on the other hand, is a system for sales. By inputting detailed information on deals and negotiations, sales know-how can be accumulated and operations can be streamlined. By consolidating and visualizing sales information, which had been attributed to a single person, it can be used for sales strategies.
As you can see, CRM and SFA are used in different ways. Therefore, it is important to clarify which field of data should be used as a reference, and then introduce the right tool for your company.
Effective sales strategies differ depending on the number of competitors and market characteristics. For example, if you are in a highly competitive market, enhancing customer support to retain customers and follow-up with the aim of up-selling and cross-selling can be effective measures. On the other hand, if the market is stable, you can expect to maintain and increase your market share effectively by selecting target regions and target groups according to the measures that other companies are developing.
There are various types of market analysis methods, but among them, macro-environment analysis, which analyzes external factors that cannot be controlled by the company, is essential. If you want to analyze the macro environment, PEST analysis is a good way to do it.
PEST analysis is a marketing framework for macro-environmental analysis that organizes and analyzes the following factors
Politics (political factors)
Economy (economic factors)
Society (social factors)
Technology (technological factors)
The information collected through PEST analysis is classified as either a business opportunity or a risk for the company, and what measures or management policies should be adopted in the future is examined.
In order to formulate an accurate sales strategy, it is necessary to understand the needs of customers. For example, checking the differences between the company's products and those of its competitors, the status of sales and market share, and analyzing the needs of customers based on their purchasing trends will lead to increased sales for the company.
In addition, it is essential to utilize data such as customer attributes and purchase history in order to accurately extract the potential needs of customers. By accurately grasping the data, you can formulate strategies that suit your target audience and implement efficient marketing.
Closing is the process of signing a contract with a customer. It is an important phase for companies to acquire new customers. However, it is often considered to be an afterthought in sales strategies.
For example, let's say you end a business meeting that day without closing the deal. If you say, "I'll get back to you later," and leave without hearing back from the customer, the customer may be reluctant to sign the contract. If you leave without hearing back from the customer, he or she may be reluctant to sign the contract, and may even decide not to sign the contract after comparing with your competitors.
Even if your actions are based on the idea of "giving the customer time to think it over," it is meaningless if it does not lead to a contract. Therefore, it is a good idea to repeat the question and agreement step by step, asking clearly if the customer is willing to buy. In particular, it is important to tell them specifically about the benefits of using your product and how it can be used.
In order to properly close the deal, it is important to be able to properly explain the benefits of introducing your product.
A sales strategy does not end once it is formulated. Periodically review the strategy and look for areas that need to be improved.
Once you have a sales strategy, apply it to the PDCA cycle, which stands for Plan, Do, Check, Action. The PDCA cycle is an acronym for "Plan," "Do," "Check," and "Action." By running this cycle, you can check whether the strategy is actually usable and whether there are any areas for improvement.
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