Chip Royce, Flywheel Advisors
The B2B tech sector is insanely competitive and companies must find ways to stay ahead of the competition.
The mantra for many is ‘grow or die’
A sales & marketing discipline has emerged called ‘Revenue R&D’ which focuses on identifying and scaling revenue-generating activities through customer discovery, market research, and product validation.
Introducing Revenue R&D
Revenue R&D identifies customer needs and wants, validates product ideas, and enhances customer experiences to generate revenue.
Not too dissimilar to technology R&D, Revenue R&D is an investigative and experimental process to identify programs that drive key marketing and sales metrics for your organization.
Some who implement Revenue R&D see it as a tool for only lead generation and sales conversion. Smart organizations recognize that Revenue R&D is useful in adjacent disciplines including market research, customer discovery, product validation and even customer support and customer retention.
What are the core steps to Revenue R&D?
Revenue R&D involves a systematic approach to managing revenue development. The key steps:
- Create a working hypothesis
- Establish a baseline experiment
- Collect data, analyze
- Identify positive signals of success or improvements
- Iterate and revise, until you establish a scalable process
- Integrate the process into your existing marketing campaigns and systems
- Continue to monitor, measure, and optimize
What do companies gain by adopting Revenue R&D?
1) Predictable and Sustainable Revenue: With a focus on activities that generate revenue, companies avoid wasting resources on sales and marketing activities that do not directly impact revenue.
2) Improved Customer Satisfaction and Loyalty: An emphasis on customer needs and wants enables companies to create products and services that align with customer expectations.
3) Competitive Advantages: Companies that implement Revenue R&D find they address customer needs and wants before competitors. These companies stay ahead of their competition and establish strong brands.
How Do Companies Implement Revenue R&D?
Revenue R&D requires a cross-functional team composed of sales, marketing, and product development experts. This team, often separate from those in operational roles, comprises competencies in creative problem-solving and dealing with ambiguity.
This team works together to collect and analyze data on customer needs and wants, market trends, and competitor activities.
Successful Revenue R&D teams establish clear processes for collecting and analyzing data and adapt quickly to changing market conditions.
Flywheel Advisors’ Unique Flavor of Revenue R&D
Traditional Revenue R&D tends to emphasize transactional marketing and sales processes usually deployed by B2C companies. We often see those situations with a tactical, near-term focus on results.
Our flavor of Revenue R&D maintains the strength of the process while augmenting it with an emphasis on relationship B2B marketing and sales processes.
Flywheel Advisors incorporates our unique ability to bring an executive/shareholder value view to the process. We look for strategic shifts and new markets and products.
In Conclusion…
Revenue R&D is a new tool to achieve sustainable growth in today’s fast-paced business landscape.
Through a focus on customer discovery, market research, and product validation, companies discover efficient marketing and sales programs and avoid waste on programs that do not impact revenue.
Companies successfully implementing Revenue R&D achieve sustainable growth, improve customer satisfaction and loyalty, and obtain significant competitive advantages over their competition.
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