Why Having Clarity Helps Drive Revenue Growth?
Anthony’s (not the real name) Company is a provider of Consulting, Advisory and Managed Cloud (AWS and Azure) Services to large enterprises.
Windsor Tech (not real name) serves as a consultant, an implementor and service provider for enterprises client and how those customers migrate work load from on-prem infrastructure to AWS and Azure cloud. Anthony is uniquely qualified to demonstrate how to clients can transform their IT by creating clarity throughout the entire company by getting everyone laser focused on the real drivers of revenue growth.
Yet, Anthony is struggling to grow his tech business revenue beyond $3.7M. Though Anthony is early in the cloud life cycle he has to compete with big boys such as IBM, DXC, Accenture and many other mid tier players to win business.
Anthony is selling into South East Asia and is also dabbling into Middle East and US markets.
When we met Anthony, the first question we asked him was the following.
What is your revenue growth strategy? Is it market expansion, market exposure or gain marketshare?
We address each with examples to identify the real drivers of revenue growth from the CEO seat.
Anthony and I discuss the differences between market expansion, market exposure and market share. I list those three in order because market expansion is the quickest way to create enterprise value shareholder wealth inside of your firm. To illustrate this point, this is where the CEO knows the market so well that he or she can place the bet and win with highest probability.
Market expansion is Windsor Tech’s main strategy where Anthony has recognised he’s in a market where there are tail winds and he needs to make the most of the opportunity. The market exposure example market demonstrates how Anthony is listening to the market, seeing a movement to cloud and trying to expose his company to that new source of growth.
The final strategy of market share gain doesn’t apply to Windsor since it’s an emerging market. This demonstrates how CEOs should create clarity throughout the entire company by getting everyone laser-focused on the real drivers of revenue growth.
Let’s take another example. We were working with a CyberSecurity company who were building security stack for both B2C and B2B segments.
The company was too focussed on expansing B2C segment while competitors chipped away and gained marketshare in B2B space. After a few years, the company now wanted to build its revenue from B2B Enterprise segment. You just simply can’t neglect competitive positioning. Developing competitive messaging to establish a strong, competitive position is a must. Influencing buyer behaviour upstream, not just into the sales channel, have to be kept in mind.
Now, the CEO should realise that he has to gain market share in chosen markets (India and South East Asia) by displacing competition at the end of every contract anniversary. This is brutal competition. Gaining market share is the company’s main strategy
There’s a completely different sales and marketing approach required to accomplish each revenue growth strategy. Buyer behaviour is changing constantly. And these insights must be considered when it comes to selling your product or services. It’s your best chance to ensure you are developing products and services that your buyers are willing to invest time, energy, and money to solve.
Sales and marketing leaders that don’t know these details are working blind. Now are you considering the quality of revenue before you deploy sales and marketing strategies on the ground?