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5 sales strategies to weather the market downturn

This is part of a new series featuring our in-house experts offering early-stage founders advice for our new community hub, the Honeybadger Den.

The market correction has been tough on many business functions, especially in areas like marketing and sales. Our early-stage founders have told us in recent weeks that keeping up with sales strategies during the downturn has been incredibly challenging. What was considered “normal” six months ago is no longer relevant. Whenever we have a looming question on this topic, we turn to Greg Lazarus, our go-to-market advisor and in-house sales expert.

Greg has over 12 years of experience as an operator in San Francisco and New York. He was most recently the chief revenue officer at Returnly where he built the GTM function from the ground up and helped increase the company’s valuation 12x over the three years he was there. Prior to Returnly, Greg was one of the first employees at Optimizely where he helped revenue grow from $3 to $70 million.

Here are some key takeaways Greg shared during an office hour session this week with our early-stage founders.

Q: How has the downturn impacted sales strategies overall?

A: Based on the current market landscape, it is best to shift focus towards expanding current customers rather than netting new customers. In other words, go to the well where you know the water is good, pure, and trustworthy. This time period will see a rise in buyers who purchase out of fear and necessity rather than those purchasing the newest, shiniest product. It is important to consider messaging and language toward customers as macro conditions change, in addition to differentiating messaging between customer segments. One idea is to send an NPS survey to current customers. Anyone who gives a 9 or 10, follow up to see what else you can get them.

Q: What are some strategic ways to close customers faster?

A: There is no silver bullet, unfortunately. I think the age-old trick here is offering timing incentives. We call these artificial incentives, like, ‘hey, if you get started a bit earlier, you can get a discount.’ These things are very well known in the industry, so people expect that. 

What I’ll say about discounting is don’t discount forever. What you should do is only discount in year one. 

The other thing to keep in mind is to get something called an i-date, or implementation date. When do you want to get this software implemented? The customer might tell you a date in December. For an enterprise sales process, that’s only six months away. That’s not horrible, right? But then we move into project management and really get into it with them to get what needs to be done by that date to accomplish what they need.

Q: What is an early-stage company’s biggest mistake in implementing a sales and go-to-market strategy?

A: The biggest mistake a company can make is focusing its efforts on selling the largest contract possible today. It is more important to think about the longer-term impact in terms of two, three, or four years out. The number one reason for churn is often not having optimizable readiness and overselling on day one. You should cater GTM approach for different customer groups rather than a blanket strategy for all customers.

Q: How do you deal with different types of customer onboarding expectations? We have some customers who have no trouble onboarding themselves and others who expect us to offer full service.

A: You’ll be doing the customer a disservice if you force them down the self-service funnel because many larger enterprises won’t be successful. I would try to control it by starting with fewer seats on day one and expanding it over time each quarter. Onboard classes of users. You can do this as homework in the middle of the sales cycle. Create a whole doc on what teams will be onboarded and when, pre-signature, so that everyone’s set up for success. 

Q: What are the most scalable methods for identifying sales prospects? Is it organic inbound/word of mouth, paying for Google Ads, or something else?

A: Content. I am a huge fan of content because it helps you be a differentiator. If you’re in a crowded market, you have to show that you’re different. So content is a longtail, but it does pay off. 

The other thing I will say is to personalize your messaging specifically for the current times and for the customer. A great example is to sell with empathy. If you’re selling marketing software, know that the person you’re talking to might be one of five people who didn’t lose their jobs that week. Understand and empathize with the current situation. Then, talk about it with the customer to understand their budget for the remainder of the year to help them achieve their goals with a limited team and limited resources. Does your product help those individuals scale or make better decisions to save money in the long run? Really personalize your talk track and center your conversation specifically on that piece of content.