When sales leaders incorporate greater flexibility into their strategic planning activities and outputs, they build in an automatic response to high inflation and recessionary risks. The sales organizations that routinely reassess their ability to respond to economic disruptions come out stronger no matter what the economic forces are outside their control. Sales coverage models are no exception. This should be one of the main priorities for sales leaders.
In 2022, according to Gartner research, 94% of heads of sales reported making at least slight changes to their sales coverage model in preparation for a potential recession. Although some level of coverage model change was nearly universal, those that made more significant changes saw the real benefits:
Outperforming competitors also requires making the right changes at the right time. To identify the proper strategy and scope of changes, heads of sales and sales operations should do the following.
Macroeconomic uncertainty is causing buying teams to re-evaluate, scrutinize, and adjust their purchase decisions. When economic changes alter buying dynamics, then old segmentation strategies, account tiering, and coverage models no longer align sales resources to the best growth opportunities.
When examining the sales coverage model, knowing when to make changes is as important as knowing what changes to make. Watch for four changes in buying behavior that signal it might be time to update coverage models:
Creating an adaptive sales organization requires sales leaders to get off their back foot and be proactive rather than reactive in understanding how uncertainty is changing customer needs. This means leveraging a technology-augmented approach to deliver valuable customer engagements in variable environments and create a more buyer-centric operating model.
It’s easy to fall into “analysis paralysis” and procrastinate necessary coverage model changes. This often leads to underperformance. When the market changes, timely changes are more beneficial than waiting too long to make the perfect adjustments.
Provide clear guardrails and direct the sales strategy leader to work with analytics teams to provide data and modeling in three areas: revenue growth potential, buyer engagement channels, and coverage expenses.
One of the first and most important things to do is have sales analytics (re)estimate the market opportunity using the recent quarter data and forecasts by product offerings, customer segment, sales channel, and geographic region. Adjust for traditionally high-value accounts hit hardest by economic disruptions. Assumptions made for customer segments and individual accounts should be layered into territory design decisions when assessing revenue potential.
Next, sales analytics should report on shifts in buyers’ interaction channels. This goes beyond simply looking at lead volume indicators to fundamentally understanding how buyers are choosing to engage with sellers. Recent Gartner research shows that 75% of B2B buyers prefer a rep-free experience, and 68% made a recent significant purchase without traditional rep assistance. As buyers opt for digital interactions, this directly impacts territory design and sales force sizing.
Last, use forecasts about revenue growth potential and buyer engagement channels to help your analytics teams evaluate how potential coverage changes would impact coverage costs, seller attrition, and ultimately commercial performance.
It’s critical to create a system to monitor and respond to any new developments that impact your coverage model while eliminating unnecessary time on re-evaluating the entire market. This system should focus on near-term scenario planning and does not need to be complicated to be effective.
Create a basic feedback system that does the following three things:
Achieving growth targets depends on having a coverage model that aligns with expected enterprise results. This requires alignment across sales strategy, customer segmentation and tiering, organization and role design, deployment, and territory management. Continuous monitoring ensures the model is optimized and meets customer needs.
Craig Riley is the chief of research for the Gartner for Sales Practice.