Vice President of Sales at Copper
Sales are the lifeblood of your startup.
Not only are sales crucial to keep your business afloat, but they can also make or break your destiny when an investor is evaluating your startup’s potential.
Low sales numbers could turn prospective investors away, and with your competitors ready to capitalize, you could be leaving millions of dollars on the table.
That’s where a startup sales strategy can make a difference. A concrete and properly defined sales strategy gives your team a clear focus and enables you to successfully sell again and again.
Want to get investors excited and inject additional funding to fuel your growth? A sales strategy develops the path, creates the vision, and provides the data and numbers to ensure goals and funding criteria are being met.
Don’t have a startup sales strategy yet? Don’t worry—we’ve got you covered. Follow the four steps below to build an effective sales strategy for your startup from the ground up.
1. Identify your target market.
Determining your target market is one of the most important responsibilities for an entrepreneur. It’s the foundation of all the elements that go into your startup sales strategy, from how you develop and present your offerings to the tools you use to promote them.
Unfortunately, most aspiring founders get their target markets completely wrong.
A seemingly great campaign pops up in their minds, and that’s where they start. The result is that most startups end up promoting in markets where no customers exist. Unsurprisingly, not having a market need is often cited as the number one reason for startup failure, noted in 42% of cases according to CB Insights:
Dedicating time and resources to identify your target market can help you increase sales revenue. With a target market, it’s easier to discover the pain point you need to address, the solution you’ll provide—and how much profit can you potentially make.
Here’s how to identify yours:
Create broad customer groups.
You don’t need to start with an ideal customer profile right away. Instead, create broader groups with general demographics that would reasonably be interested in your product or service. Use a few of these basic characteristics to get a rough idea of who you’d be targeting:
If you do need to build some ideal customer profiles, here's a worksheet you can use.
You can also use these general groups to exclude consumers who don’t fit your market criteria. For example, if you’re running a startup like Glossier, you might eliminate men from your target market to start (unless of course, you plan on producing a men’s line as well).
While it’s definitely possible for a man to make a purchase from such a brand as a present for a woman in his life (or even for himself), you wouldn’t consider him to be your ideal customer. Your target market and consequent sales strategies would, therefore, revolve around women.
Look at the competition.
Take a look at who your competitors are targeting: Are they going after the same consumer groups as you are? Are they targeting segments you hadn’t thought to include? How are they positioning their product or service?
It will be easier for you to give the answers once you analyze the competition. Look at their social media pages, visit their websites, and subscribe to their email lists to get an idea of the market they’re trying to capture.
You can consider selling in the same target market or focus on a segment your competitors may be overlooking—based on your brand, offering, and resources, you need to choose your target market accordingly.
How'd do they do it?
Upgrade your sales skills and close more deals. Get a detailed breakdown of 10 sales strategies used by different types of businesses in this free guide.
Research industry reports.
Industry reports can provide clues as to the type of consumers you should be targeting and sometimes how an industry is shaping up. These reports may cover the typical customer age, brand preferences, and other useful information.
One way to find relevant industry publications is to search the internet for terms like:
- [product type] industry report
- [industry name] industry report
- size of the market for [product type or industry]
So if you were the CEO of a startup that sells smartwatches, you’d search for “smartwatches industry report” or “size of the market for wearables.” Below is an excerpt of a report presented by Google for the first search term.
It reveals that smartwatches are increasingly popular among the 15-35 age group . For someone who’s spearheading a smartwatch startup, this insight is as good as gold.
2. Create an ideal customer profile.
This is where you kick your market research and observations into high gear. Identifying your target market is a necessary first step, but the most successful startups have a much deeper understanding of the people who buy from their company.
An ideal customer profile takes your data down to a granular level, closing the gaps and taking the guesswork out of your efforts.
It gives you a more specific look at who your ideal customer is, including (but not limited to):
- Demographic data: location, gender, age, marital status, education, job title, income
- Psychographic data: values, beliefs, fears, frustrations, expertise, personality
- Behavioral data: purchasing habits, brand loyalties, lifestyle
Ideally, you can put all this data together to create a “story” about a fictitious person who fits the bill.
Here’s a visualized customer profile that you can use as a template for your own:
A key part of an ideal customer profile is identifying their pain points: what’s a problem they face that consistently acts as an obstacle or hindrance?
When you understand their problems—and combine them with what you know about their values and habits—you’re able to position your company as the most credible, efficient, and trustworthy solution to those problems.
Let’s say you’re launching a fitness app. Here might be some key points of your ideal customer profile:
- Demographic: Professional women in their 40s and 50s. They earn $50,000+ per year, are single or divorced, and may have children.
- Psychographic: They value health and fitness, freedom, confidence, and intellect. They’re masters in the workplace, but have little fitness expertise. They fear not having enough energy to perform optimally and not having enough time for themselves or their children.
- Behavioral: Their workdays are long, often leaving them too tired to work out—though they enjoy hiking and biking, and they can afford a personal trainer and gym membership. They use Facebook as their primary social media platform and they’re loyal customers at Starbucks and their local organic market.
You can then use this information to tailor your messaging and sales strategy to more closely align with who they are and what they’re all about.
3. Incorporate sales enablement into your startup sales strategy.
There’s nothing worse than a sales call where your sales rep doesn’t have access to the information they need to answer the customer’s question. Or a sloppy internal system where leads fall through the cracks.
This is often a critical oversight in startup sales strategies: information silos that prevent the sales team from having all the knowledge they need to provide a robust customer experience.
Cue sales enablement.
A SiriusDecisions study found that, among companies reporting $750 million or more in annual revenue, 83% have implemented or plan to implement an enablement strategy.
In addition to having stellar sales skills, your reps should also be well-trained on the inner workings of the company and the products and services they’re selling. And they should also have the systems and support needed to make those monthly sales goals happen.
At the end of the day, virtually every aspect of your company is relevant to the sales process, from operations to IT to marketing to implementation.
Your sales team should always be in sync with other departments.
One of the most important connections is between the sales team and the marketing team. Since your sales team relies heavily on marketing materials like case studies, guides, ebooks, and the like, it’s critical for these two departments to be on the same page.
Try strategies like:
- Connecting your sales and marketing teams to collaborate on new content for sales calls
- Training sales reps on implementation so that they can deftly answer customer questions
- Creating a central database with everything a sales rep might need
- Sharing your marketing team’s cloud storage database with your sales team
- Providing reps with email scripts and templates that facilitate their conversations (especially follow-ups) with prospects
Ideally, you'd have a system where you can load up a bunch of these resources. With the help of a CRM that enables you to create templates and reminders for different initiatives (like cold emailing and following up with clients), you’ll empower your reps to tackle any scenario that comes their way.
4. Set quotas and offer incentives for achieving them.
Sales won’t scale itself! You’ll need to set goals and targets in order to keep your reps motivated and on track across every phase of your sales strategy.
Startups might have quotas for the number of emails they send, meetings they conduct, or deals they finalize. Or you can use a more delegated approach and set targets for the value of business they generate.
For each target, make sure there’s an owner and a deadline. Many quotas can be achieved long before a stated period, so put them up on a chart and make sure the owners know they’re responsible for them.
Setting sales targets will vary from startup to startup, but this means they’ll also be more realistic and attainable for reps. If you have a luxury product with a low count of high-value sales, your targets might be lower than a startup with a wide range of inexpensive products that sell in volumes. You’ll need to take this into account when creating motivational and realistic sales goals and objectives.
You’ll also need to come up with ways to motivate your sales team to achieve these targets. Monetary perks are a great jumping off point, but there are several other ways to reward high-performing salespeople. Xactly, a leading provider of incentive compensation programs, recommends subscription boxes, free parking, gift cards, and many other types of creative sales incentives.
Documentation is key to making your strategy work.
Building and launching a startup is an exciting and incredible endeavor. While it might seem like the best idea is to dive right into sales, you’re much better off taking the time to research and strategize your ideal targets and processes—and make sure to document every step of the way.
By creating tangible documentation, you’ll also be able to keep all of your organization’s relevant members tuned into the strategy, creating a smooth and streamlined experience for everyone. Plus, you’re better able to keep track of what’s working and what’s not so that you can iterate and improve your strategy with each passing day.
The result: a systematized, proven sales strategy that will help you blast through your growth goals.
See how to use CRM as a tool to get that hockey-stick growth with this free guide.