In the traditional, pay-per-product economy, a sales cycle was simple. One product – one sales person – one customer. The product was delivered, the customer paid, the sales person earned their commission. Simple. In today’s fast-paced subscription economy, the sales cycle is much more complicated and involves more teams. Developing, executing and optimizing a sales strategy is much more complex and the tools that were built for the old economy sales model, just can’t keep up with the intricacies of today’s businesses.
The subscription economy is changing everything, including major business drivers. Subscription businesses are forced to react to a multitude of changes to ensure that they are able to grow and support their business. Customers are allowed the adaptability to either pay as they go, or per subscription or long-term contract and since they are now in the driver seat, they demand flexibility and change. Companies have to consider stickiness of the product, robustness of the contracts, and overall customer engagement and satisfaction to ensure growth. With customers in control, organizations have to be able to realign sales strategies to adapt to their needs. This shift in control, impacts how organizations are measuring sales performance success.
Business drivers evolve throughout the engagement with a customer and as they change, the metrics that define the success of a subscription business shift. Metrics such as Customer Acquisition Cost, Lifetime Value and Retention Rate make-up the basis as to how the performance of the sales team is measured. These new metrics add another layer of complexity to your sales performance strategy.
As businesses evolve through different stages of growth, cross-collaboration between teams is imperative to success. Because there are many people involved in a single customer engagement, each interaction with the customer affects the next making sales strategies, compensation plans and business goals more complex. Managing the visibility of each interaction and ensuring that the sales performance strategy is aligned and can adapt to the constant change of a subscription business, helps to maintain predictable sales performance.
The metrics of success for a subscription business move beyond traditional ERP and CRM solutions. In order to get the whole picture, subscription businesses need the ability to access multiple data sources such as project management, billing, and customer success tools to determine the health and success of their business across the many departments that are involved in the sales cycle. A robust sales performance management solution allows subscription businesses to access all of these necessary components to help them understand, analyze and execute the best sales strategies to grow their business.