Managing the Top Line
This blog is focused on the Computer Software Business for Enterprises. As defined by Investor’s Business Daily, the sector has 63 companies producing software products globally. Steady earnings growth requires advancing revenues with costs under control. Many CEO’s find themselves with a quarterly sales forecast that does not meet the requirements for the upcoming earnings report.
What can the CEO and his staff do during a quarter to improve sales projections?
Interactive Intelligence (ININ) is a good example of a great performing company which reported (June 2014 Earnings) a 38% decrease in revenue for year over year performance. The company’s stock market performance has gone from an Investor’s Business Daily Composite Rating of 99 in 2011 to today’s rating of 5 out of a 100 best rating. The stock price closed today at 43, a 47% decrease from its market high.
Management exudes confidence in the long-term growth potential. They describe a shift in revenue from primarily on premise products, paid in full on delivery to primarily cloud products paid monthly over a period of time. This reduces short term revenue but improves the long-term outlook. The future is bright.
Maybe the CEO should do nothing. He knows this dip is coming and that it is not a threat. However, the stock price and the general reputation of the company has deteriorated, which is not a happy result.
Factors that can be manipulated to improve sales and thus earnings include:
- Marketing
- Sales
- Customer Experience
Assuming the CEO wants to mitigate this drop in revenue as much as possible, here are a few ideas that he could implement in the short term.
- Marketing
- Create a sense of urgency with a price reduction that expires at the end of the quarter.
- Run an ad campaign to emphasize the short term benefits.
- Use and email campaign to drive traffic to website which has a landing page that will lead to closing business in the short run.
- Offer free white papers and case studies through ads and emails to accelerate new contacts with prospects.
- Sales
- Run a quarterly sales contest with recognition and bonuses to winners
- Set up an executive sales call campaign where VP’s and C-level management works with salesmen to make calls on best prospects. Stick to a goal of closing business in this quarter.
- Customer Experience
- Initiate an inbound customer service rep cross-sell program. Incentivize the rep to make sales when customers call for other types of support.
- Present a high performance trophy to the employee who contributes the most to this quarterly campaign to product top line sales growth.
I know, I know. These are basic, even simplistic ideas to help generate more short term sales. The main idea is to communicate to all employees the situation. We are going through a tough time and we need to take pro-active steps to minimize the damage or even to continue our past performance. People react better to management requests if they feel they are truly making a difference. Everyone needs to know the problem and the solution and they need to be asked to help make a difference. They will.
If you need sales or marketing consulting, technical or MarCom writing or Project Management help, please call or write—513 827 0945 or resmith10@aol.com.
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