Revenue Strategy: 10 Proven Strategies For Growth
Optimizing your company’s revenue streams is not just important; it’s crucial for ongoing growth.
It doesn’t matter whether you’re a startup founder, CFO, or RevOps leader; if you don’t have a clearly developed and documented revenue strategy, you’re not maximizing your income possibilities (and probably not reaching those lofty goals you’ve set for yourself).
But simply saying “we need to drive more revenue” isn’t enough. You need a solid strategy for growth.
So, in this article, we’re going to explore 10 powerful revenue strategies, so you can incorporate a combination of tried and trusted tactics into your approach (and maybe integrate those with a handful of well-calculated risks).
What Is a Revenue Strategy?
At the highest level, revenue strategy is your plan for making more money (revenue). Revenue strategy should include short-term solutions (like optimizing your sales compensation plan) as well as long-term ones (like a more strategic focus on customer retention).
In any case, revenue strategy is the “How” in “How are we going to increase revenue this financial period?”
Of course, every business has a different method for driving this revenue growth. Otherwise, it would be too easy, wouldn’t it?
So, let’s explore 10 proven strategies for revenue growth, so you can choose the option(s) that will work best for your own company.
Revenue Strategy 1: Lean Into Your Top Revenue Drivers
The first step is figuring out exactly where your money is coming from now, and, most importantly, what’s driving that.
In essence, you’re looking to determine your biggest revenue drivers.
Let’s say, for instance, that you generate revenue from three sources:
- Subscription customers
- Ad revenue from free accounts
- One-off implementation fees
Of the three, subscription accounts are your biggest revenue stream.
Now you need to investigate what it is that drives new subscription customers. It might be:
- Account-based marketing strategies targeting key enterprise customers
- Lead nurture campaigns designed to convert free users to paid plans
- Social media ads that convert self-service buyers
Ask: which of the acquisition methods is performing best?
That’s your key revenue driver, and so your next step is easy: double down on that channel.
Revenue Strategy 2: Optimize Sales Ramp Time
For those wanting to grow sales performance (so, like, everyone), one of the first places to make changes is in resourcing.
That is, if you want to sell more, you’ve got to hire more sales reps.
The problem most of us run into, however, is that it takes a whole lot longer to get sales reps up to our performance expectations than expected.
This is called ramp time, the amount of time it takes for a new hire to go from the bright-eyed newbie to the hungry sales shark who’s regularly hitting their quota.
One strategy for increasing revenue growth is to focus on reducing that sales ramp time.
Ask: how can we make sales onboarding faster, so reps are achieving sales quotas sooner?
Tactics here might include:
- Reviewing and optimizing your initial onboarding process
- Setting up a buddy system so new hires are mentored by a high-performing rep
- Adjusting your hiring guidelines to only bring on more experienced reps
- Hiring a dedicated sales trainer (rather than having onboarding and training as one of many responsibilities of the sales manager)
Revenue Strategy 3: Hire Intentionally and Strategically
Often, startup founders hire fairly intuitively.
That is, they realize there is a gap to fill urgently (like when somebody quits), and that’s their trigger for hiring.
But all that leads to is bad hires (made under pressure) and a failure to really strategically grow the teams that need the most manpower.
Intentional and strategic hiring is about thinking long-term and forecasting resourcing need.
Ask: what does our resourcing need look like three, six, or 12 months from now, assuming our revenue growth goals are met?
Say, for instance, you’re hiring six more sales reps now, doubling your team.
You know that in three months, they’ll be ramped (because you used revenue strategy 2!), and so you can expect to be generating twice the amount of sales you have now.
That means, obviously, you’re going to need more:
- Admin support
- Customer service and success reps
- Server space
Hire strategically by forecasting team grow, understanding what your likely future need will be, and getting job descriptions and ads out now.
Revenue Strategy 4: Go Hard On Upsell and Cross-Sell Opportunities
If you’re not training your sales team to look for upsell and cross-sell opportunities, you’re leaving revenue on the table.
Upselling is when you recommend a better product or plan. For instance, if you have three pricing tiers, you have an opportunity to upsell anyone who isn’t on the top tier.
Cross-selling is about recommending additional products. Maybe you’re a sales CRM and you have an email marketing add-on. Anyone who doesn’t have that add-on could be a candidate for a cross-sell recommendation.
However, don’t just throw a blanket attempt out there.
Ask: what does our usage data tell us about the likely need for this product?
Let’s say, for instance, you have a customer on the cheapest pricing tier. The next tier up offers more automation runs per month, and they’re close to reaching their limit.
Here, you have a good opportunity to upsell.
Revenue Strategy 5: Explore A Partner Sales Model
Growing a sales team takes some time, but there’s a quick and helpful little workaround:
The partner sales model.
In this model, you have other businesses or individuals sell your product to their clients, and they take a percentage or commission for each.
Sure, you earn a little less per customer, but in return, you reduce your sales cost center, and you can start earning revenue right away (if the partners you choose are experienced).
Ask: what other consultants or businesses are selling a different product to a similar audience?
Revenue Strategy 6: Double-Down On Your Most Impactful Customer Segments
We’ve already talked about doubling down on your biggest revenue drivers, but you can go a step further and identify the customer segments that are most impactful from an income standpoint.
Let’s say you sell a project management platform, and you have a bunch of different use cases. You support marketing agencies, freelancers, internal project managers, and construction leaders.
Ask: which of our customer segments are driving the most revenue?
Of all of these, maybe marketing agencies are the segment that is delivering the most revenue because they require multiple seats per customer.
So, double down on your marketing budget to target more of these customers, and improve your ROI and revenue growth.
Revenue Strategy 7: Align Organizational Goals With Your Sales Compensation Plan
One big mistake many RevOps leaders and startup owners make is designing a sales compensation that looks good, but doesn’t actually align with your organizational goals.
Let’s look at an example:
Your main goal is to grow monthly revenue. Your salespeople earn commission based on the number of new customers they close. These two goals aren’t necessarily aligned.
A sales rep earns the same commission for closing a $50-a-month deal as they do for a $10,000 deal, for instance.
Ask: does our sales compensation plan encourage our reps to work toward our organizational goals?
Revenue Strategy 8: Focus On Customer Retention To Drive Recurring Revenue Growth
Revenue doesn’t just come from new customers; it also flows from existing customers.
Or, more accurately, revenue is leaving when customers churn.
So, don’t neglect existing relationships when focusing on revenue growth. In fact, many startups see better revenue growth from customer retention than they do from acquisition.
Ask: what do our customer success and retention programs look like? How can they be improved?
Then, put all hands on deck to develop a solid customer retention and expansion program. Some tactics include:
- Hiring customer success managers
- Developing automated lead nurture content
- Minimizing support ticket resolution time
- Implementing a new subscription cancellation flow
Revenue Strategy 9: Carve Out A Niche With Brand Differentiation
A lot of companies exist in pretty crowded marketplaces.
If you’re a sales CRM, email marketing tool, or project management platform, for example, you’re not exactly the only offering in your sector.
So, you’re probably struggling to convince potential customers to go with you over a competitor.
In other words, you need to differentiate.
Don’t try and target all possible customers; narrow down on those you serve best, and market to them.
Ask: which sector do we cater to better than everyone else?
If you’re a sales CRM, for instance, perhaps your features serve the real estate market best. So, forget catering to everyone and refine your messaging to speak directly to real estate agents.
Revenue Strategy 10: Reduce Customer Service Costs By Building a Self-Service Support Hub
Not every customer is going to be able to just sign up for your thing, jump in, and get running.
Many of them will have complex needs, and it’s fair to say that some of them might need a little help from a technical standpoint.
This can suck up a lot of your customer success team’s time. And it so often goes that it’s those small accounts (read: not much revenue) that need the most support.
Solve this problem by building a self-service support hub.
Ask: what questions does our support team get asked most? What do customers most commonly need help setting up?
Identify the most important needs, and create documentation to guide customers through. It’s best to have both a written version and a video walkthrough to cater to different learning needs.
This will free up your support team to dedicate more time to large accounts, improving retention of your most valuable clients.
Put These Revenue Strategies Into Action!
Those are 10 revenue strategies you can start implementing right now.
But wait, before you go, one more thing.
You’re going to need a trusty financial modeling and reporting platform by your side, so you can keep track of all that revenue that’s pouring in.
This content is presented “as is,” and is not intended to provide tax, legal or financial advice. Please consult your advisor with any questions.