Pipeline Composition and Ansoff Matrix: Supercharging your 2018 Revenue Plan

If you are like many of my clients, you finished up the end-of-fiscal year push for Q3, used the first half of the month to catch up, and have now begun the annual task of revenue planning. Few things are one-size-fits-all when it comes to the intricacies of pipeline planning, but one thing remains true: Companies must have specific targets for pipeline SIZE and pipeline COMPOSITION.

“If you fail to plan, you are planning to fail” Benjamin Franklin.

If you talk to business leaders and business developers/ salespeople, you’ll get as many views on how to build the pipeline. Many companies use the pipeline to build revenue plans, from which they build their budgets. Some even use the pipeline to forecast revenue to equity partners or shareholders. Other don’t put an opportunity into the pipeline until the bid is submitted.

Consider:

  • Is your approach limited or enhanced by the number of people involved in the process?
  • What is the impact of the vision and expectations of the company leadership?
  • What systems, processes, and technology exist to manage your pipeline?

Some companies use advanced technologies to manage their pipelines, with triggers, reporting, and dashboards used by management. Others use Excel and even have several different versions of pipelines for different business units sitting on a Sharepoint site or a shared drive somewhere (or even have them sitting on local machines, not connected to anything).

When it comes to pipeline SIZE, it will depend on whether you sell to public sector or commercial sector, how long your sales cycle is, whether you are selling products or services, average deal size, and historical win rates. In many companies, target pipeline size is fairly standardized—between 3-5 times the annual sales target.

It is pipeline COMPOSITION that keeps many business owners up at night. What opportunities should you focus your B&P funds on? Are there new or takeaway deals at agencies where you already work, and you have relationships and customer intimacy you can leverage? What about deals that focus on selling your core competencies, where you can leverage your impressive past performance? Strategic importance is another option, when the government or a specific agency seems to have an emerging need that you think you can fill; or that the company has growth goals with a certain agency, or offering, and so you build a pipe around that. These are each worthy of consideration, and to some extent, the best plan is to build a diversified portfolio of opportunities to ensure that you are positioned for growth across the board.

While much of this depends on leadership, vision, growth strategy, and maturity of the company. I like to cross reference an oldie but goodie from business school: the Ansoff Matrix. When you look closely at the matrix you see many of the options we talked about for revenue growth and pipeline planning. Once you look at it that way, some of the how, where, why becomes more apparent.

Selling where you have customer intimacy means the top row (aka “current markets”), selling your core offerings is the first column (aka “current products”), and so on. As you consider where to place your bets, you cannot ignore how much time and money it takes to build your company in each direction.

  1. The MARKET PENTRATION quadrant is the least expensive, quickest way to sell work. Think of this as re-competes, or even takeaways and adjacent offices and programs within the same agency. This is where you expand your footprint and share of work within one account. Deals in this quadrant will naturally have higher win rates (85-95%).
  2. Now think of the MARKET DEVELOPMENT quadrant where you would position to sell core offerings into new agencies. You can potentially grab more money chasing this business, but it will take you more time (to build customer intimacy) and investment (to establish your reputation and company visibility) to make this happen. Another option to aid with this type of growth is to form strategic alliances and/or bid as a subcontractor or a small business prime to help a large get a piece of the work. Deals in this quadrant will have more modest win rates (35-45% depending on competition and contract vehicles).
  3. The NEW PRODUCTS quadrant is when you will sell new offerings in your existing agency clients. This is also even more time consuming, and potentially even more expensive. You may need to pay large sums to hire key personnel who can help you build that capability and are already seen as experts in that specific skill, or you may even need to acquire a company who already has the capability you wish to offer to your current customer. This may be a great option, however, if you are entrenched in the agency or program and the program officer is specifically asking you, as a trusted contractor, to help them meet specific needs they have. Deals in this quadrant may have higher that middle win rates (60-75%), since you are being brought in early in the sales cycle and already have established trust with the decision makers and influencers.
  4. The last quadrant, DIVERSIFICATION, is going to be the hardest, will take the longest (think 3 to 5-year plan), and requires much more money from the acquisition and marketing investment standpoint. This is where large companies will have the advantage over smaller firms. The companies I worth with seldom need to have opportunities like this in their pipeline. For those that do, it is likely a smaller portion (10-15% of the opportunities they are chasing), unless they are in a mature market with declining sales. Deals in this quadrant can be considered “stretch” opportunities, and will surely have lower win rates (<25-30%), but they catapult growth and dramatically change the company at its core.

Knowing all of this, as well as your company’s tolerance for risk, ability—and willingness to invest in people, marketing, and B&P—you can go into revenue planning with a portfolio mindset. You know what percentage of the revenue plan will be targeting each growth segment, and which elements—customer intimacy, past performance, or strategic intent—will be leveraged.

Please share your thoughts on pipeline composition strategy in the comments section. And if you’d like a consultation to help you think through this with your leadership team at the table, check out my company site.

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Good Content is Hard to Find: Ain’t THAT the Truth!!!

Content Marketing is the new buzz word in the field of marketing. Though, it isn’t exactly a new concept. Some of us practicioners have been marketing “content” for decades, we’ve called it “thought leadership” marketing. But, no matter what you label it – it WORKS – and it all hinges on one critical element – CONTENT!

This is where the rubber meets the road. In professional services firms, we strive to demonstrate expertise by planning and implementing integrated marketing campaigns that give our clients and prospects a meaningful insight that they would find valuable – CONTENT! However, as any of you struggling with the main ingredient for content marketing know—good content is hard to find!

I read articles and listen to presentations on marketing by the dozen. There is an overabundance of information out there, available to each of us, so how do you sift through it all? I choose to listen, absorb, and try on for size – what appeals to me. Reading articles such as “The Content Marketing Pyramid: Are You Hungry for Content?” , helped me realize that in an era where modern marketers are always held up by the constant need for “content” with which to market, curated content is a valid option. So, what “mix” of content is optimal? Not all content is created equal.

In his article, @TweetsFromPawan uses the Age Old Food Pyramid to talk about CONTENT mix. I think it is a valid framework and it has influenced my thinking. As a marketer, I have always pushed to create new, targeted content for marketing. However, in my personal “content” quest – I use “curated” content at least 50% of the time. Can “curated content” be credible to position the firm as well as ourselves? So alas, my first blog post…..

I will strive to take a solid position – and my position is YES, yes, a thousand times YES! Even B2B (business-to-business) and B2G (business-to-government) firms should be including a curated content strategy as part of their overall marketing strategy. As always we should take our lead from B2C (business-to-consumer) marketing trends, which quite possibly start with personal marketing trends (what individual’s with brands are doing/ saying publicly online).

Below,  I’ll outline my Pro’s and Con’s below, just so you can get the cliff notes version of my countless hours of thinking and conversing with peers, colleagues, competitors, and clients about this….

+ POSTIVES +

 

– NEGATIVES –

Marketing gains content (the missing ingredient) Lose some ability to track metrics/ report
Tie your brand’s name with other relevant brands in the industry Send browsers to a web site other than your own
Your brand can become known as the go-to resource for all-things relevant to your target audience, a clearinghouse if you will
Build relationships online
Increased frequency of messaging

That said, curating content is not to be taken lightly. In my school days of card catalogs and bibliographies teachers and administrators considered curating content – plagiarism. Therefore, be deliberate about how you source your curated content and never take credit for their content as your own. In fact, I encourage you practitioners out there to form relationships with other content marketers and actually PLAN to share content intentionally! (And, er, don’t forget to share your blog post with them if you are referencing them …)

Also, do not underestimate the “read between the lines” messages that ensue due to curated content. You are in fact telling people that you (or your brand) supports the author (or brand) of the curated content. Even if you have all the right disclaimers on your blog or handle profile, this is still the unspoken agreement. It’s not awful; it’s just a fact of life. We aren’t talking paid celebrity endorsements here, just a simple declaration, that I (or my brand) like what this person (or this brand) is saying about X. So be planful about what brands and individuals you choose to curate content from – you’ll be glad you did!

Also, proceed with caution. Don’t go “All-In” your first time out of the gate. Let me be clear, I am not suggesting that curated content is the secret sauce for all of our content marketing troubles! Curated content will certainly prove to be high payoff, low risk for specific marketing channels (e.g. social media platforms like Twitter and Linked In), but not others (say your Corporate web site). There will be shades of grey for sure too – like, should you use curated content in email newsletters? Only time will tell what the tolerance will be for that type of behavior, and it will surely vary by market, sector, and brand.

And so I ask you—do you agree with curated content having a place in B2B and B2G marketing? If so, have you tried it before? And can you please share your successes and failures? (Inquiring minds want to know!)