Building a Sales Pipeline
This is my site Written by Alora on June 7, 2010 – 11:19 am

Sales PipelineThere is nothing harder for a non-salesperson than building a sales pipeline. In Bagging the Elephant I highlight a post about a recent event in NYC, in which entrepreneurs discussed how to build strong enough relationships with larger businesses in order to be taken seriously enough to close deals with them.

This is part of a much broader issue, though, and it’s one that is a constant struggle for most small businesses: how do we keep new sales coming in the door, when that’s not our background?

I find this to be a particularly big issue in the web space. So many of the entrepreneurs that I meet come from a development background, and they have started their venture with the Field of Dreams theory: “If I build it, they will come.”

And more often than not, nothing could be further from the truth. And even worse, is that all too often, a new entrepreneur will build a product with no thought to marketing or sales strategy until they are done building, and then they will shift their attention to client acquisition, as an after thought.

Often times this doesn’t happen until the entrepreneur is out of money, so hiring the right help is almost never affordable, and the entrepreneur is running so low on their savings that they are watching the clock tick down before they have to give up and go get a J-O-B from someone else.

The horrible reality is that marketing and sales is where most entrepreneurs drop the ball — and that is true whether your business is a product or services business. People have taken the democratization of data (the “Google effect”) to mean that, as long as they offer something good, that means they’ll be able to find customers. But that’s not true at all. The democratization of data means that you’re now competing with thousands of competitors doing something similar enough to what you are doing, that you not only need to be better, but you also need to find all new ways to get customers’ attention.

The rule of thumb for a new business owner is simple: your first year marketing and sales budget should be the same as your first year development budget.

Where technical entrepreneurs get into trouble is in thinking that since they didn’t have to pay anyone else to build their product, that means that their marketing budget can be small, too. Wrong. Do the match as if you had to pay someone, by the hour, to do the work. And then you’ve got a start.

But even more important than cost is timing: don’t wait until you’re at the end of the line to start marketing your business. By then you can’t afford experts, experimentation or the time it takes to really see progress.

The bottom line: building a marketing strategy with a solid sales pipeline won’t happen over night. If you wait until the week before you run out of money, you’re never going to get there. Start early, and put the same degree and quality of resources into the revenue generating aspects of your business as you do into your product.

After all, isn’t making money with your product critical to your business? Don’t make the mistake of treating it like an unworthy afterthought.

  • MiGrant

    Thanks Alora, very timely for me right now!