Breaking the Cycle of Stagnating Revenue: A Strategic Framework for B2B Success

Pyramids often get a bad rap in the business world, but I promise this one is different from any pyramid scheme you've heard of. No need to sell questionable products or recruit your friends and family into a cult-like organization. This pyramid is all about building a solid foundation for your B2B revenue activities and climbing to the top without any shady tactics.

Maximizing revenue is the ultimate goal for every business. When revenue stagnates, the first reaction of CEOs is to allocate more budget, increase channels, add more personas, launch new campaigns, and just do more of what they're already doing. However, this isn't always the best approach for most Software as a Service (SaaS) businesses.

To achieve better results, it's crucial to focus on doing less in a more effective and efficient way. In other words, rather than doubling down on existing processes, it's better to take a step back and focus on the fundamentals and setup of your business. After months of tinkering, I've come up with a pyramid with different layers to help visualize the Hierarchy of Revenue Activities.

The Pyramid

The pyramid consists of five layers that range from high to low importance.

Let’s break down each level:

Layer 1: Strategy

Strategy is the most crucial layer of the pyramid. It includes customer research, strategy, positioning, messaging, and Minimum Viable Product (MVP). Without a solid strategy, a business will struggle to grow and maximize revenue.

Layer 2: Setup

The setup layer includes growth models, landing pages, technology stacks, and data. Once you have a solid strategy, it's time to set up the infrastructure needed to support it.

Layer 3: Process

The process layer consists of planning, lead generation (Push), and demand generation (Pull). It's important to note that process isn't as important as the first two layers, but it's still a vital component of the pyramid.

Layer 4: Resources

Resources include the team and budget needed to execute the strategy and processes. It's crucial to have the right people and funding to make your vision a reality.

Layer 5: Goal

The goal layer is where revenue is achieved. This layer isn't as important as the first four, but it's still essential to have a clear revenue goal in mind.

Focus on the Fundamentals and Setup

Instead of focusing on the execution on every layer, most businesses that are struggling should focus on only the first two levels. The fundamentals and setup of their business. By doing so, you can achieve greater effectiveness and efficiency.

Layer 1: Better fundamentals → greater effectiveness

The first step is to improve your fundamentals. This includes customer research, strategy, positioning, messaging, and MVP. By defining sharper personas, better positioning with more compelling messaging and branding, you'll naturally start using those parts to tweak your acquisition activities in a way that'll yield more results.

Layer 2: Better setup → greater efficiency

Once you have a solid strategy, it's time to set up the infrastructure needed to support it. This includes growth models, landing pages, technology stacks, and data. By having a better setup, you'll achieve greater efficiency in executing your strategy.

While the concept of focusing on the fundamentals and setup may sound simple, it can be mentally challenging to execute. Niching down feels like going after a smaller market, and taking a step back can feel like you’re not progressing. As a result, most teams won’t take a step back, and consequently, never end up taking steps forward either.

Let’s Break Down Action Items for Each Layer.

1. Improve Your Fundamentals

The fundamentals of your B2B revenue activities are the foundation of your success. This includes customer research, strategy, positioning, messaging, and minimum viable product (MVP).

• Customer Research
  • Conduct surveys, interviews, and feedback sessions with your customers to better understand their needs, pain points, and preferences.
  • Analyze customer data and feedback to identify patterns and trends.
  • Create detailed customer personas that capture the essence of your target audience.
• Strategy
  • Develop a clear and concise strategy that outlines your goals, objectives, and tactics.
  • Identify your unique value proposition (UVP) and key differentiators.
  • Conduct a competitive analysis to understand your competitors' strengths, weaknesses, and opportunities.
  • Establish a roadmap that outlines your short-term and long-term priorities.
• Positioning
  • Develop a positioning statement that clearly defines your target audience, value proposition, and competitive advantage.
  • Create a messaging framework that aligns with your positioning statement.
  • Develop messaging that resonates with your target audience and differentiates you from your competitors.
• MVP
  • Launch a minimum viable product (MVP) that meets the basic needs of your target audience.
  • Gather feedback from early adopters to refine and improve your product.
  • Continue to iterate and improve your product based on user feedback and market trends.

2. Improve Your Setup

The setup of your B2B revenue activities includes your growth model, landing pages, tech stack, and data.

• Growth Model/Growth Hypothesis
  • Develop a growth model that outlines how you plan to acquire, activate, retain, and refer customers.
  • Identify your key performance indicators (KPIs) and metrics.
  • Monitor and analyze your KPIs and metrics to optimize your growth model.
• Landing Pages
  • Create landing pages that are tailored to your target audience and aligned with your positioning statement.
  • Optimize your landing pages for search engines (SEO) and conversion rates.
  • Use A/B testing to experiment with different landing page designs and copy.
• Tech Stack
  • Choose a tech stack that supports your growth model and landing pages.
  • Invest in marketing automation software that helps you automate and scale your revenue activities.
  • Use analytics software to monitor and analyze your website traffic and user behavior.
• Data
  • Collect and analyze data on your website traffic, user behavior, and revenue metrics.
  • Use data to inform your growth model, landing pages, and messaging.
  • Continuously refine your data collection and analysis process.

3. Improve Your Process

The process of your B2B revenue activities includes planning, lead generation, and demand generation.

• Planning
  • Develop a detailed and actionable plan that aligns with your strategy and growth model.
  • Break down your plan into manageable tasks and milestones.
  • Use project management software to manage your tasks and deadlines.
• Lead Generation (Push)
  • Use outbound marketing tactics, such as cold emailing and cold calling, to generate leads.
  • Use account-based marketing (ABM) to target high-value accounts.
  • Use lead scoring to prioritize and qualify leads.
• Demand Generation (Pull)
  • Use inbound marketing tactics, such as content marketing and search engine optimization (SEO), to generate demand.
  • Use social media marketing to engage with your target audience and amplify your messaging.
  • Use email marketing to nurture leads and drive conversions.

4. Allocate Resources

The resources of your B2B revenue activities include your team and budget.

• Team
  • Hire and develop a team that has the skills and expertise to execute your revenue activities.
  • Create a culture that fosters innovation, creativity, and collaboration.
  • Use cross-functional teams that bring together different perspectives and expertise to tackle revenue challenges.
  • Invest in ongoing training and development to keep your team’s skills and knowledge up-to-date.
• Budget
  • Allocate your budget strategically across your revenue activities, with a focus on areas that will have the greatest impact on your goals.
  • Continually review and optimize your budget allocation based on performance data.
  • Don’t be afraid to experiment with new channels or tactics, but be sure to measure their impact and adjust accordingly.

5. Define Goals

• Revenue
  • Set specific, measurable, and realistic revenue goals that align with your business objectives.
  • Break down your revenue goal into smaller, actionable targets that can be tracked and measured over time.
  • Regularly review your progress and adjust your revenue activities as needed to stay on track.

A Few More Things to Keep in Mind

1. How do you balance short-term revenue goals with long-term sustainability and growth?
2. What strategies can you implement to continuously innovate and stay ahead of competitors?
3. How can you align your revenue activities with your company's overall mission and values?
4. In what ways can you leverage technology and data to improve the effectiveness and efficiency of your revenue activities?
5. How can you build a company culture that prioritizes revenue growth while also promoting work-life balance and employee well-being?