5 key points to define your sales organization

It's high time for you now to take action and translate this great strategy into effective field practices to achieve your goals.

Don't know where to start? KESTIO guides you with the 5 key questions you need to ask yourself at this stage.

1. What will be your marketing and sales mix?

The distribution of roles between marketing and sales is an issue to be addressed carefully and well in advance: with the development of SaaS offerings and the increasing digitalization of sales methods (Inbound Marketing, Social Selling, Sales Automation, etc.), the share of resources allocated to marketing is constantly increasing (the 1 to 2 ratio between marketing and sales is reversing).

It is absolutely necessary to have a clear vision of the stages of your sales funnel and to differentiate between those that fall under marketing and those that fall under the action of your sales representatives.

2. Should You Prioritize Inside Sales Representatives or Field Sales Representatives? 

 This is an essential aspect of your sales organization, and it depends primarily on the nature of your offer and its distribution method.

 If you sell perpetual licenses with maintenance subscriptions, you will most likely opt for a partner network capable of managing the installation and follow-up. And in this case, you will mainly need field sales representatives to meet them, supported.

 And in many cases, you will have to manage the cohabitation of these 2 models and determine all the more precisely the account allocation criteria and the allocation of sales forces that results between your inside and field sales representatives.

 3. What skills should your sales representatives master?

It is also useful to ask yourself about the skills that your sales representatives will need to master. In direct connection with the first two points mentioned, but also depending on the profile of your customers, you will thus determine the sales methods, techniques and tools to implement.

According to the latest EY-Syntech study, the two main clients of software publishers in France today are the banking and industrial sectors. If this is your case, your sales representatives must be well-versed in "Key Account" sales methods, such as the Chessboard Method, and complex sales.

The public sector ranks 3^rd in this classification. If it is one of your priority targets, your sales team should focus on mastering the tender process and the associated sales techniques.

In a predominantly digital sales model, the role of salespeople is very different: with qualified contacts identified and nurtured upstream by marketing, "Inside Sales" essentially has the role of refining the qualification of needs, guiding the client in the choice of options, creating ambassadors for the solution within the client's organization, or even mapping out the decision-making powers.  

Customer loyalty is also becoming increasingly important. We are also seeing the emergence of new sales roles, such as Customer Success Managers (CSMs), who are responsible for ensuring the quality of the Customer Experience.

In any case, a consultative sales approach – based on demonstrating the ROI of your solutions – is beneficial in your sector to showcase the value you bring.

These are all elements to keep in mind when implementing an HR plan (recruitment, training plan, etc.) in line with your business strategy.

4. Are you planning to expand your sales internationally?

 Another key consideration for organizing your sales force is the proportion of revenue generated internationally and the strategic importance of international clients to your company.

While French publishers still generate a very large majority of their sales domestically², the share of overall revenue generated outside of France continues to increase, particularly driven by SMEs and start-ups resolutely focused on international markets from their inception, such as Criteo or Allegorithmic, for example.

A point that significantly impacts the sales organization to adopt for these companies: once the strategic geographic areas have been identified, you can determine whether your dedicated sales force operates from within France or directly on-site. Consider all the resulting factors: whether or not to establish a physical, relocated branch, the country's social and commercial legislation, and the opportunity to favor an English-speaking 'master version' of your solutions over a French-speaking one.

And from the point of view of your sales organization stricto sensu: adapting your promise and sales arguments into several languages and according to local cultures, the need to homogenize sales processes, sharing information between potential subsidiaries, deploying a CRM internationally, implementing cross-border management and steering...

5. What will your performance indicators be?

The last crucial point for your sales organization: its management, and therefore the monitoring and analysis of results. Indeed, the choice of key performance indicators and their analysis determine:

• • The effectiveness of managing your sales activity
  • Calculating the compensation of your sales representatives (a sensitive subject, to say the least!).
  • The type of sales management adopted

And therefore, more generally: achieving the objectives that you have set for yourself! The current evolution of sales methods is reflected in the choice of KPIs present in the reporting.

Today, the 5 main indicators tracked by software vendors are:

1. 1. The distribution of revenue by type of sales: licenses, SaaS subscriptions, or support/maintenance (on average today, almost 1/3 for each!)
   2. New orders recorded: the « booking » 
   3. The evolution of monthly recurring revenue, or MRR
   4. The revenue per country
   5. The « churn rate » or attrition rate (contract non-renewal rate)

 It is noted that two of them (MRR and churn rate) are directly correlated to the development of SaaS. In this new model, reducing and maintaining churn between 0 and 1% becomes a goal to achieve in order to ensure the profitability of the system as a whole.

Considering that customer acquisition costs are 5 to 25 times higher (depending on the sector) than the cost of customer retention... this indeed encourages paying particular attention to customer loyalty and the commercial levers that support it!

Booking remains essential, as evidenced by the choice of this criterion as the basis for calculating variable compensation for sales representatives by 34% of software vendors (compared to 26% for revenue generated).

Addressing these 5 key questions will allow you to define the best sales organization with regard to your objectives and the strategy defined upstream. And to have a clear vision on how you will manage it and ensure its effectiveness over time!