Building new channels of leads and sales is expensive in terms of time and/ or resource — so, is now the right time to make the investment for your startup? And if so, how do you do it?
In this article we look at business development from a strategic and tactical point of view — what are you trying to achieve and how to do it. In addition, we’ll look at how to manage the ‘tone’ of your sales calls or invitations to purchase.
If you’re in a hurry — please take one thing away from this article; getting the tone of your messaging right matters now more than anything.
Let’s start by looking at strategy and then tactics before moving onto how to set the right business development tone in a time of crisis:
Business Development Strategy
It doesn’t much matter whether you are using SEO or paid digital media to generate new leads or direct one-to-one phone / zoom calls, it takes time and money to generate a new source of business prospects and customers.
The goal of business development is nearly always to build a long term reliable flow of customers by developing channels to market. So here’s how to begin:
Review what is happening in your sector
The digital economy is surviving and in some cases thriving but the real world economy is tanking and in many ways, we don’t know what will happen next. So, the answer to the question of whether to invest in business development depends on how you and your startup view the future.
The danger in thinking about new business is that we can be drawn to focus on what will work today or the next 10 weeks, but forget to think about what will happening in perpetuity. Those startups that get the right long term strategy will do far better, albeit, with less ‘immediate’ success.
Set your time frame
The importance of executing well is as significant now as it has ever been. Typically, a business development activity such as an investment in SEO pays off in a 12 month time frame. So, to succeed, you need to be thinking about what people will search for in a year’s time and then begin to work to optimise for those search terms now.
And, whilst there are short term opportunities — searches for toilet roll, hand santiser or masks — it is easy to forget that your bigger goal is to build reliable and predictable channels of lead generation.
Hence, take the low hanging fruit on offer for your sector, but keep your focus on the 12 month question.
First, know your cash position
Before you invest in business development — regardless of whether you are putting in cash, time or resource, you need to know that you can stay in business long enough to see the payback.
So how long is that?
In the current crisis founders have gone from asking if 12 months cash is enough runway to whether 24 months or even 36 months money is enough? The answer is probably somewhere in the middle — but will vary a lot by sector.
It is true for most sectors (with a few exceptions) that the payback on business development in the current crisis has slowed down and is more uncertain. There is more work at the ‘top of the funnel’ building trust, talking to potential customers and less ‘closing sales’ at the ‘bottom of the funnel’.
In many ways, we are still in a wait and see mode — because as they say:
Just because the water is still, it doesn’t mean a crocodile isn’t lying underneath
Shifting focus: from growth to revenue
In the good times startup leaders found fund raising — not easy — but plentiful. And, with business angel or VC cash came an expectation that startup businesses would focus on growth — not so much revenue and profit hardly at all.
Although WeWork’s failed IPO in mid 2019 put paid to the ‘don’t think about profit’ mantra of the last five+ years, the crisis driven shift in venture funding means that profit and now revenue is back on the menu of what good startups do.
Hence, whilst a lot of founders were previously challenged by their investors with the question ‘are you ambitious enough for growth…’, because they the next round of investment relied on hitting growth numbers; founders are now left asking, whether this is still the right question to ask?
Mostly, it is not.
Founders face uncertain futures on further venture investment and therefore, moving from ‘growth at all costs’ to revenue and profit that protects and builds cash is both critical to survival and equally, hugely affects the role that business development plays.
Tear up your old conversion rates
First up, old conversion rates no longer make sense. In other words, what happened or applied before the crisis hit, is history. We have to begin again with how we measure our business development and sales targets.
If customers are totally strapped for cash, then we can’t add to their burden by asking for a sale. So, think through how you can construct an offer that helps them solve a problem or unlock an opportunity for them.
Can you, for instance, delay payment for three months? Can you offer something for free? So, rather than bespoke advice, can you direct them to a self-help article that gives them a self diagnostic tool that allows them to solve a challenge?
Earn a customer — not acquire one
One aspect that will come to the fore in the current climate, is that we are changing our language around customers — aim to ‘earn’ a customer, rather than ‘acquire’ one.
And ask whether your business development is designed to earn that customer?
In a similar way that good SEO content seeks to educate and build trust, we need to build enough trust with a customer to earn their business. The concept of ‘customer acquisition’ feels part of a world we have left behind.
Business Development Tactics
Putting the strategy to one side, execution is always critical success — so here, we’ll look at effective tactics that work today:
Good SEO content: answers questions
Building and sharing content is a key ingredient of any attempt to reach customers and your business community.
That’s as true now as it has ever been.
For SEO, content is often effective when focused on answering questions and teaching readers something useful.
What we are looking for, though, is content that answers questions now, tomorrow and next year — the ever-green question, if you like. Because these questions and answers will pay back over the long term.
Paid vs Organic — short or long…
Right now, paid digital media is offering a short term opportunity to acquire clicks more cheaply. Whether this is from free account top ups or simply that the increase in page views has helped reduced the cost per click, there is a short term opportunity here.
However, good organic rankings in search take longer to achieve and so need to be part of your long term strategy.
Paid media offers short term tactical opportunities but it is key not to miss the benefits (and business resilience) that comes from developing organic rankings.
As always, keep doing the basics right:
In SEO there are a list of basic things to do — the trick is to keep doing them over time — like this list. Similarly, keep doing whatever basics of business development you’ve been doing and look for long term results:
Use more email
Email open rates are up 30 to 40% and especially on Mondays… which means that people want to hear from you — they are receptive to what you have got to say — if, of course, you say it well!
Get your business development tone right
Beyond business development tactics & execution, setting the right tone in your messaging and conversations is now critically important;
First, review your existing content…
All your pre-coronavirus content needs a review. Check what you were saying before Covid-19 — it may no longer apply or it may not be appropriate in the current climate.
In particular, look at the images you use — photos of large groups gathering or people holding hands, may or may not be appropriate. Any strap lines describing something as ‘finger lickin’ good’ might not portray the image of a mature, responsible business at this time.
First rule, in all communication, be human — be competent and empathetic and, founders, lead from the front.
Look at what other companies are doing — writing to customers regularly to explain how they are working to protect staff and customers, asking for opinions and working to get stocks back on shelves or planning for the return to the New Normal.
If you are the founder or CEO — the communication needs to come from you — not some brand ambassador — just look at how ‘well-known influencers’ and ‘celebrities’ are the least trusted spokespersons:
The same report also states that 65% of people will consider a brand’s response to covid-19 before deciding whether to buy (source).
By any comparison, 65% is an eye-popping number — getting your message right — and genuinely doing right, are critical to your long term survival and success.
Help first — money second!
Similarly, 90% of consumers want to see brands protecting their staff at all cost… (source) even if they suffer financially. Safety comes first and above all things!
Consumers are are looking to brands for leadership — they want to know how you will look after customers and how you deal with your teams — do you really care about your teams and do you talk about the good things your teams do?
In particular, be careful of price rises — food delivery companies have lost lots customers over a few unwise price rises on key items — like toilet roll!
This is the time to help solve challenges — not sell yourself.
How to talk to new people — talk about the elephant!
Phoning new people for the first time risks a harsh response — ‘why are you phoning me now — or why are you corresponding with me now….’
So, if you use the phone or email to speak to prospective customers, here are some tips; acknowledge that:
- our phone calls / emails are interrupting, it might be home schooling hour or cooking time!
- that we are living in odd time
- the ‘elephant in the room’ — your business may be on a knife edge
Find out how people are and how their business is fairing before you begin a potential sales conversation…
Take a breath… and listen to the tone!
In this crisis, many people are feeling lonely, powerless and frightened.
For luxury brands, for example, marketing in this environment risks portraying themselves as inappropriate and offensive. Hence, for these and many other brands, take time to refocus your core message and change your tone to emphasise utility, competency and business integrity rather than something that is can easily be perceived as decadent.
Sometimes, founders need to take time to breath…
…pause campaigns that don’t feel right or sit well with the current mood and take time to hone your message
Equally, if challenged online, work hard not to react out of anger — yes, there is a danger of undermining a lot of good and hard work with a few unwise words. Give people the benefit of the doubt — we never really know their personal situation.
Lastly, double check that your message doesn’t fall under the ‘tone deaf’ category.
Take your time. And, as they say, measure twice, cut once…
Avoid bandwagons and think about the future we creating
When you are cash strapped and things are tough it is really hard not to want to jump on a bandwagon — but people can see through this stuff — so, instead, stay consistent and genuine and follow through on what you set out to achieve in the beginning.
We founders are, after all, creating the future, so do allow yourself to have a bigger vision and a sense of what you want to achieve, not just for shareholders, but for wider stakeholders and your community too.
Are you creating customer success?
And perhaps top of your list for what you want to create is customer success! That is, instead of (just) measuring your own profit and loss, measure how you have helped customers to grow and develop their resilience. Track their success as well as your own.
After all, there is nothing more heartbreaking for founders than customers who are indifferent to what you do…
How do you charge?
When customers are either cash strapped or fearful to invest, how do you make a sale?
Typically, these conversations lead to a ‘share of future revenue’ conversation— but that is fraught with problems — not least, what if one party doesn’t perform or it takes 3 months to discover that the plan isn’t working or the campaign requires a bigger and unexpected investment from one party than another?
And, when you have staff salaries to pay each month, how do you keep the cash flowing to pay meet your bills?
Which brings us full circle; business development is an investment based on a 12 month view — and at the moment, that view might be unclear.
Regardless of how you see the year ahead, take this opportunity to lean into helping people, looking after your customers, staff and doing whatever you can to solve problems for them.
Maintain the core business development, through SEO or direct contact, that you have been doing, build good relations with your community and your stakeholders, and, as the view of the future clarifies for you, then, step by step, move back into business development investment.
This article is the seventh in our series of leaning into the challenge. Previous articles include; the eCommerce future of digital marketing, startup surviving and thriving in a time of coronavirus, selling and marketing in a time of coronavirus and building home based teams and startup fundraising and cashflow plus The New Normal.