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Outbound Sales Science: How Growlabs Went From $0 to $2.5M ARR in 6 Months
A proper outbound sales strategy has real science behind it. You can’t just start pounding the pavement with no direction and expect to achieve growth.
Wanna know the secret sauce behind a scalable outbound process that leads to significant growth?
Market Segmentation combined with tailored messaging.
The key to achieving explosive growth is to start by identifying your Ideal Customer Profiles (ICPs) via segmentation, reaching out to them with personalized targeted messaging while building a scalable and repeatable process.
At Growlabs, we’ve grown from $0 to $2.5M Annual Recurring Revenue (ARR) in 6 months: our outbound sales system is fueling this growth. And this guide, we’ll breakdown exactly how you can do that too.
How To Build An Efficient Outbound Sales System
- Identify your most attractive markets via market segmentation.
- Establish a clear, value based hypotheses that will guide the segmentation.
- Generate customer data and insights.
- Analyze data and group customers into Ideal Customer Profiles.
- Evaluate the attractiveness of each segment.
- Find leads in each micro-segment.
1) Identify your most attractive markets via market segmentation.
Market segmentation, if you’re unfamiliar with the term, is the process of dividing a market into clearly identifiable customer groups.
Doing this well and early on will lead to increased conversions, improved financials, and faster product iterations.
At my previous company (a ticketing app for event organizers), this strategy allowed us to grow 800 percent per year, three years in a row, acquiring more than 28,000 customers globally.
Market segmentation is a fairly simple concept but it requires discipline and iteration.
Start by dividing a broad target market into discrete subsets of individual consumers or businesses who have common needs and interests. Next, begin designing and implementing strategies to target them.
There are three main approaches to market segmentation:
- Firmographic segmentation
- Needs-based segmentation
- Value-based segmentation
Value-based segmentation tends to be the most valuable and practical approach, as it helps companies focus on their most lucrative segments. It also best positions them to craft successful channel strategies to convert each segment.
Creating a value-based segmentation can be done with these main steps:
2) Establish a clear, value-based hypotheses that will guide the segmentation.
Hypotheses should be clear, logical, testable, and formed around customer characteristics or factors that allow your company to clearly separate current customers into distinct value-based segments.
For example, large online e-commerce platforms use your technology because you help them reduce fraud. Or, smaller e-commerce and SaaS businesses use your promotional tools to increase traffic to their sites.
3) Generate customer data and insights.
A list of accounts must be developed to use as a data set. Built from a billing or customer relationship management database, the list needs to be comprehensive and include all customers with the exception of trial and proof of concept accounts.
In addition, accounts that are outliers, too recent, too old, or too small (in terms of revenue or organization size) should not be included as they may erroneously influence your analysis. The overall goal here is to determine basic criteria that will create fences between customer groups.
4) Analyze data and grouping customers into “Ideal Customer Profiles.”
Try defining each profile with segment-specific characteristics. For example: marketplaces that use our platform and have high web traffic, significant funding ($5 million to $50 million), and use Stripe as their payment processor.
Here is an example of several ICPs:
5) Evaluate the attractiveness of each segment.
A formula or set of weighted criteria must be developed in order to measure the attractiveness of each micro-segment. Considerations include:
- Current size of segment, in terms of economic value.
- Customer quality.
- Ease of outreach to the segment.
- Potential of the segment for future growth or expansion.
- Fit into current business model
- Need for any significant changes within the business.
- Length of sales cycle.
Such a formula creates an objective measure that can consistently be used to compare and prioritize micro-segments.
Typically, the final choice of micro-segments is quite obvious. However, as markets and competitors change, it is important to continue refining each segment and identifying additional ones to ensure your company focuses on the most attractive markets.
6) Find leads in each micro-segment.
Once you’ve identified the most attractive markets as well as your ICP in each, it’s time to start generating a list of leads.
It’s difficult to generate high-quality leads that will convert into clients however, quality is one of the most important criteria.
If you simply increase the volume but do not qualify these leads, you will only end up spinning your wheels over and over. However, if you can increase your volume of leads by 20% without decreasing your quality then, your business makes 20% more income.
Lead generation is tough. 85% of B2B marketers consider lead generation their #1 challenge.
How To Get Started With Lead Generation
1) Do it yourself and / or have your sales rep do it manually.
While this is extremely time consuming, it’s good to start manually in order to understand where and how to find companies and contact information you’re looking for.
2) Hire a contractor.
Once you want to scale things up, you can hire contractors to do the research for you. Platforms like Upwork are a great way to hire and manage them. Make sure to provide extremely specific notes on what to research.
You’ll want to consistently monitor your contractors’ data quality as well as costs.Typically both of these metrics get worse over time.
Another challenge you’ll face with contractors is cleaning up the data, adding it to your CRM and removing duplicates.
3) Work with a Lead Generation company.
Buying leads from a database can be extremely helpful. Unfortunately, not all lead databases are created equal.
Many databases contain:
- Outdated and/or incorrect information.
- Leads that don’t match your target job titles, company size, location.
- Leads you already have in your CRM.
- Leads that are already customers.
Find a company that provides high-quality, verified leads. The leads should be segmented to your needs, and relevant to your industry.
Make sure leads are always de-duplicated against your existing database.
4) Just say NO to bulk lists.
Always make sure to generate lists that are extremely targeted. You should be able to narrow your list down by location, industry, company size and other relevant criteria. See below an example taken from one of our audience searches:
5) Engage leads with laser-focused messaging.
Now that you’ve found high quality leads, it’s time to reach out.
One of the most effective channels is outbound email. This consists of a series of highly personalized, hand-crafted emails. Since you have (or at least, you should have) segmented your leads into micro-segments, you should be able to craft very personalized emails. Typically, an outbound email campaign contains 6 to 8 separate emails. In between each email, you’ll want to pause for several days to give leads enough time to read and respond if they’re interested.
8 Steps To Write Better Outbound Emails:
Step 1: Make email content as personal as possible.
Personalization, even if you’re doing high volume emailing is critical. Readers should feel like each email was individually written for them specifically by a sales rep. Don’t copy and paste every word from a template. The more genuine and on-brand you sound, the more likely it is that you’ll get a positive response.
Step 2: Introduce yourself and what you do.
Don’t beat around the bush or ask prospects long-winded questions, for self-reflection, etc.
Step 3: Keep them short & sweet.
Attention spans are extremely short these days. The fewer words you use to get your point across, the better.
Step 4: Keep the messaging simple.
If someone doesn’t understand what you’re offering, they’ll put your email in the trash. Avoid jargon whenever possible.
Step 5: Explain what’s it in for them.
What are the pain points you’re solving? How will you add real value?
Step 6: Create FOMO (Fear Of Missing Out).
Use language that makes your offering sound exclusive or intriguing. (e.g. “Your competitor is already using us and gaining a competitive advantage from it.”)
Step 7: Build credibility.
Don’t make blunt statements (e.g. “We’re the best company…”). Try to include relevant data points, client names or case studies. (e.g. “1,400 companies use our fraud API, including leading merchant processors such as Stripe, Shopify and Braintree.”)
Step 8: Have a clear Call To Action (CTA):
Each email should have a specific CTA at the end. Request 15 to 30 minutes of their time for a quick phone call or demo.
Bonus Tip: Warm Up Your Leads!
Another great addition to outbound email campaigns is to “warm-up” your leads by adding these leads to a dynamic ad campaign, pushing the emails of your target accounts to the ad audience.
One of our clients at Growlabs is using our Adroll connector to create dynamic audiences and is seeing fantastic results.
Make sure to continuously monitor your campaigns (both email and ad) and A/B test them.
If done correctly, outbound can lead to significant growth. It’s a highly scalable and repeatable way to acquire new clients.
Also published on Medium.
This is a sponsored guest post from a Sales Hacker partner.