Creative Science Labs was functionally lost and was seeking a better understanding of what their sales process should look like. They were bringing in sales but they wanted to increase their revenue, and didn't have an understanding of what the first step was. Their previous efforts had not yielded any results. Year over year they were repeating the same revenue number without much of any growth.
Industry: Web Design & Development
Location: Washington D.C
Size: 20 – 30 Employees
CSL is a web design company which designs and develops all of their websites based on theories derived from Behavioral Economics.
“[RGC] helped us completely revamp our outbound strategy… our average deal size went from $35,000 – $75,000 just from a few tweaks that [RGC] helped us make to our proposals”
– Nate Andorsky
CSL’s had many sales challenges which initially led them to contact RGC. One of the issues identified was that they had too many salespeople who were selling about the same amount, however, the deals that they were selling were not very profitable. CSL was making enough money that they didn’t need a drastic change, but not enough money to be happy with where they were.
Their cost of sales were too high. They felt that everything in their sales process was reactive. They knew that there were activities that they should be engaged in, and they knew that there were solutions to their problems, but had no idea what to do and how to go about actually growing their revenue.
CSL lacked a proper sales process. Their current process was to wait for an inbound lead or a request for proposal, at which point they would start their sales process. Then there was a short discovery period followed by a proposal. More often than not they would lose the proposal process and only win a small number of potential deals.
One of the biggest mistakes that we noticed was that CSL was very reactive. They waited for things to happen. They wanted to grow, yet they made no intentional effort toward growing and they weren’t engaged in the right activities that would result in revenue growth. As previously mentioned, all their sales for the previous three years had been triggered by either a referral or inbound lead, not by their own activities. They were not proactively engaged in the sales process, and everything was reactive.
The biggest mistake we found was that they focused very heavily on themselves and what their capabilities were, and not on their clients.
During their discovery process, which led to their proposal, they were asking very surface level questions. These questions were not meant to engage or evoke any real emotion in the clients. Evoking emotion is something RGC has determined to be one of the biggest success factors in closing deals.
CSL was looking for a better way. Their numbers, their sales, and their annual revenue for 2016 was just shy of $3.7 million. Their cost of sales was close to 30% of that, which did not even factor in their cost of goods sold or their overhead. One of their biggest challenges was profitability, which was derived from their cost of sales being far too high for reactive sales.
The manner in which inbound leads and referrals were treated was completely changed by RGC. Before they had a very relaxed approach and they asked surface level questions to get a mild understanding of what the situation was. From there, they put forward a proposal. That process was changed and they began taking the inbound leads a lot more seriously. They began to really pay attention during the discovery process and ask the right questions. They began selling by way of questions and using the discovery process to really sell the clients.
When the proposal came, it was no longer just a presentation. It was a conversation that involved drilling down into what the key challenges were and putting forward a solution of how to fix the problem rather than just telling them what the deliverable was going to be. They began really speaking to the solution and speaking about it in the client’s terms, which helped to resonate with the clients and communicate the message.
RGC implemented a process where CSL went outbound to find their clients. That was a significant factor in increasing revenue because prior to that they were really reactive and waiting for inbound leads.
RGC directed CSL to remove three salespeople from the sales department, reducing it to just two individuals. The two individuals actually increased the revenue significantly compared to the previous sales department of almost five salespeople. RGC put forward a strategy to create an outbound sales process where CSL began hunting deals and going after new clients. RGC created a process that was systematic, easy to follow and fairly simple, but required time, energy, and effort.
RGC created a list and target of specific accounts for CSL to go after and specific types of clients and projects to complete. RGC created tailored messaging and hyper-focused on specific individuals and accounts. From there, CSL reached out to them and engaged them in discussions. CSL gauged their interest, got them to open up through the discovery process, and ultimately submitted proposals. Not all of were immediately won. Some were quick wins, others required more long-term effort to build relationships and close the deal when the time was right.
A big challenge for most agencies is to properly explain what their differentiating quality is. Some are clueless and ramble on and on about how much they care about all their client’s and how hard they will work and how passionate they are about their craft. CSL was skilled enough not to make this simple mistake. However, it was still difficult for them to differentiate their talents in their space considering their creative deliverable was conceptual and subjective.
RGC was able to help CSL define their Unique Selling Proposition and create a new direction for their messaging.
The previous average deal size was between $35,000 and $50,000 between the years of 2013 and 2015. In 2017, the average deal size was $75,000 plus. Obviously, the profit on those deals was significantly higher as well. With RGC assisting with the sales process, the following year the cost of sales was cut to below 10 percent of the overall revenue. The revenue increased by 35 percent from the previous year, which led to a significant increase in profit. As the revenue went up, the cost of sales went down simultaneously.
Before RGC: $35,000
After RGC: $75, 000