Revenue Operations Things You Need to Know
What is Revenue Operations (RevOps) ?
RevOps or Revenue Operations is a holistic function to integrate sales, marketing and customer support and align it in a way that would increase their collective accountability to revenue generation.
It helps in getting rid of the silos between the different verticals of an organization as it ranges across people, platforms and processes.
Wondering when to implement RevOps in your organization?
Well, here are a few signs that you should implement RevOps:
3 Reasons to Implement Revenue Operations in GTM Sales Strategy
When your company is using too many tools. RevOps helps in acquiring, implementing and management of these tools, saving the extra costs.
Broken Processes are increasing. In a fast evolving business world, there is a dire need for the integration and updation of processes. RevOps ensures the inclusion of all teams during the creation and implementation of new processes.
When you don’t know what’s working and what’s not. Determining what campaigns or activities are leading to a good ROI is difficult when the teams are working in silos. The RevOps function will help get a better clarity on the ROI as it looks at every activity holistically from a business perspective.
What is a GTM (Go-To-Market) Plan?
A go-to-market plan is a specific action plan that spells out how a product should be launched and brought to the market. It specifies the marketing plan, business strategy, pricing and distribution strategy for the product that will help the company achieve its business goals and KPIs. 5 elements define a Go-To-Market plan. They are:
Target market: Who is your target audience? What are their pain points, which your product is addressing? What is your typical user profile?
Product-market fit: What are the problems that your product is offering a solution to? What is the unique selling point and what is the value addition of your product to the customer?
Pricing: How much should the price of the product be and across how many categories? Is your price competitive and does it justify your offering?
Distribution: What does your distribution channel look like? How will your product reach the customers? Is it through an online channel or physical channel of distribution or both?
Competitor analysis: What are the offerings made by your competitors? Is the market ready for your product or is it oversaturated? What makes your product stand out from competition?
What are the four areas of responsibility for every RevOps team?
Operations Management
Sales enablement and performance management
Insight generation for better decision-making
Software and system tool development and management
How do RevOps and GTM Plan Combine?
When you establish goals for your GTM plan, a RevOps team helps in holistically orchestrating the GTM plan by making constant adjustments and updations to deliver the best results. RevOps provides a singular view of the entire GTM plan and ensures that all the steps taken are accountable to revenue generation.
For instance, suppose you are running a restaurant, you will always have to make sure that the customer experience is the best and the revenue is maximized. To do that, you will make sure that all the operations and the delivery is designed in a way that ensures customer satisfaction. You will try to reduce the number of redundant steps or tasks as much as possible to not lose revenue.
Why is revenue operations the key to go-to-market plan
Revenue Operations is essential to bring agility and achieve the goals set out by the GTM plan. In most cases, the management of tools like the tech stack needs a dedicated team that optimizes the revenue and aligns the business processes. RevOps helps in building and developing processes to increase the efficiency of the GTM plan and maximize revenue.
For example, suppose your company’s GTM goal is to achieve 75 percent YoY (year-on-year) growth in revenue. This will form the objectives of the RevOps team, i.e.:
Increasing customer retention rate by 40%
Increasing conversion rate by 60%
Increasing awareness about the product in new markets by 3x
Reduction in the sales cycle by 30%
What are three requisites to create a successful GTM plan using a RevOps model:
People: It is essential to build a strong RevOps team that can understand the unique needs of the business, its challenges and can devise processes and systems that will help in achieving business goals. There should be people from the sales team, marketing team as well as the customer success team.
Process: The sales, marketing and customer success processes in the organisation need to be optimised and aligned with each other.
Technology: Handle marketing automation and CRM tools in order to deliver the best customer experience and accelerate revenue growth.
4 Market trends in 2021 Rev Ops Adoption
Here are some market trends in 2021, related to Revenue Operations:
There will be a boom in the demand for professionals in the RevOps role: In the past few years, there has been a 300% (according to some survey) increase in the number of listings for VP of Revenue Operations on Linkedin. Most companies now understand the importance of alignment across teams to achieve business goals.
Increase in the RevOps tech stack: As the companies are realising the importance of revenue operations, the tech stack is also growing in order to solve the business problems and to align across teams. Platforms like Slack are being used to maintain internal communications as well as enrolling stakeholders in decision-making.
Automation and Integration will be key to revenue operations success: Without a sophisticated automation and integration system in place, it is very difficult for companies to make the correct business decisions. With the explosion of data, it has become imperative for the RevOps team to leverage these automation tools to make data-driven decisions and optimise their processes, leading to shorter sales cycles.
RevOps will play a crucial role in generating insights about the customer life cycle and increasing customer retention– The goal of every organisation is to make the entire customer journey smooth and create a wonderful experience in order to increase repeat customers, which is much more relevant and significant for B2B organisations. Hence, RevOps will play an important role in generating customer insights. This can ensure a seamless customer experience and increase revenue for the organisation.
3 Key challenges and milestones in RevOps
The major challenges that are faced by Revenue Operations teams across industries fall into one or more of the following categories:
Politics: Sometimes, a few top executives might not be willing to let go of the control to a new RevOps team.
Uncertainty: Sometimes the way forward is not chalked out well by the C-suite executives by the company, which wraps the organisation in a blanket of uncertainty.
Partnership: A lot of times the operational teams do not align on the shared goals or there is a lack of partnership between the teams to come together to make revenue operations strategy a success.
Despite the barriers, there are a few milestones that spell out success for any RevOps team. Some of such success milestones can be defined as below:
Optimisation of the processes to maximise revenue generation and integrating the department silos in an organisation.
Introduce new tech around company operations in order to automate redundant manual operations.
To effectively manage change with realistic expectations and optimise the existing sales operations and marketing operations processes in the organisation.
To launch effective GTM plans that will be accountable to revenue maximisation as well as have shared business goals and KPIs.
Metrics and technology for a focused revenue operations strategy
The RevOps metrics vary according to the product and growth stage of the organization. It should vary according to the business goals of the company.
6 key Revenue Operations (RevOps) Metrics to measure the revenue operations
Win rate:
The number of closed opportunities that were won back by the sales team.
Customer Acquisition Cost:
This is calculated by finding the total cost that is spent on the sales and marketing to acquire a customer. CAC should always be less.
Average Recurring Revenue:
It is the expected revenue that will be generated after a product is provided to the customers for a year. It is used in subscription-based businesses.
Customer Lifetime Value:
It is the average value received from a customer over the entire span of the relationship with them.
Sales Pipeline Velocity:
The rate at which a lead reaches the different stages of a pipeline and finally makes the purchase.
Sales Cycle Time:
The average duration taken to win a deal with a client.
An effective sales planning model
A Marketing Aligned Sales Plan
One of the best sales planning models can be devised by taking into account the marketing efforts being made by the organization. In this plan, you create buyer personas and user profiles for your product and then go about the sales pitch according to the profile.
When a revenue operations team is present in an organization, it will be ensured that the right steps are taken by the management to align the marketing operations and sales operations strategy to achieve its common business goals.
30-60-90 Day plan: Another effective sales planning model is the 30-60-90 day plan where up to the 30-day mark the sales team learns about the company from their processes, customers, products and competition. From Day 31-60, the sales plan is to be implemented and a keen analysis of the processes needs to be done. From Day 61 to 90, the plan is to be optimized for improvement. Implementation of new strategies need to take place.
CRM and Sales Alignment
A Customer Relationship Management (CRM) tool helps you get a 360 degree view of your customer profile. A 360 degree view means that all the customer touchpoints are tracked during the customer journey.
In simpler terms, a CRM software provides you with complete knowledge about the customer, from his basic information to the various touchpoints the customer has had with your company.
This enables you to get a holistic view of the customer and you can make your sales pitch according to the stage the customer is in. It will help you make a more relevant and personalized pitch and customize your messaging accordingly. All your sales efforts will then be determined on the customer’s position in the sales pipeline and hence you will cater to his specific needs.
Using the information on the CRM, you can also upsell or cross-sell to your potential client based on the queries that he has raised in the past.
Data-driven marketing decisions can be made using the information on the CRM and the customers can be nurtured and treated to tailor-made marketing efforts before the sales calls are made. This makes the sales call all the more credible and increases the chances of conversion.
With the evolving business scenario, globally, the relevance of RevOps will only strengthen soon. Incorporating RevOps shortly will only improve the customer-facing business processes and the customer experience as a whole. There has been a 10 to 20 percent increase in sales and 30 percent decrease in the GTM cost in organisations that have adopted RevOps.
