07/05/2024 | News release | Archived content
Published: July 05, 2024
Wondering why a marketer is writing about business development? It's because I've learned that business development is more than just a fancy term for sales.
Business development is actually a company-wide strategy that brings every department on the same page - including marketing and sales.
So grab a comfy chair, get a cup of coffee (or something stronger), and let's dive headfirst into the world of business development planning.
Table of Contents
Business development planning is the process of creating a roadmap for your company's growth and success. I think of it as a treasure map that lets you navigate the treacherous waters of the business world to find the buried treasure (aka long-term profitability).
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That said, just like in a treasure hunt, you must also perform a series of steps to ensure you end up with a treasure in your hands:
While that's enough of Jack Sparrow - or Captain Jack Sparrow - let's dig deeper into how to develop a business development strategy.
While you might want to settle with "make more money than last year," you need to define your wishes into clear objectives to have a shot at achieving them. So, whether your business objective is to reach a revenue figure, develop a new product, or expand into a new geographic region, lay it out.
To come up with clear business objectives, I recommend going SMART:
For instance, if you own an ecommerce company, you might define your business objective as: "Increase average order value by 15% in the next six months by implementing a personalized product recommendation system and offering bundled deals."
If you're having a hard time coming up with SMART business objectives, I find HubSpot's free template for SMART goal setting incredibly helpful for getting started.
You might think that you know your market inside out, but let's face it - assumptions can be dangerous.
In fact, Amy Kauffman, chief marketing officer at CMO Room, shares that, "The biggest mistake I see companies make when developing their business strategy is not doing enough market research upfront. Many founders are overconfident in their product or idea and assume that if they build it, customers will automatically come."
Put on a pair of X-ray glasses to see what's really going on beneath the surface. Find out what your customers want, how much potential the target market has, and what your competitors are up to.
At this point, I typically scour industry reports, government statistics, and online databases. If you wish to do the same, here are my recommended sources:
That said, while these sources should provide most of the data you require, I still recommend using the good old-fashioned method of talking to people. Use surveys or interviews to get inside your potential customers' heads. Find out what makes them tick, what keeps them up at night, and what they really need.
David Janovic, founder of RJ Living, especially recommends detailed market research for businesses expanding to new markets: "When entering a new market it's definitely crucial to be putting the time and effort into conducting thorough market research - which will help you understand the local landscape, customer preferences, and potential competitors."
Finally, I take all the juicy data and connect the dots to inform my business development strategy moving forward.
Once you've done your market research homework, it's time to zero in on your ideal customers. After all, you can't please everyone.
I recommend creating buyer personas, which are fictional yet realistic representations of your ideal customers based on data. If you have existing buyer personas, update them based on the insights from the market research.
Pro tip: If you don't have any buyer personas or need to develop another one for a new audience segment, check out HubSpot's buyer persona generator. It helps you flesh out your target customers' pain points and motivations.
Next, evaluate the market size, growth potential, and opportunity of each buyer persona. See which buyer personas align with your business objectives and prioritize them accordingly.
Now that you have researched the market and the customers, I recommend taking a long, hard look in the mirror to assess your current position and figure out where you stand.
The best way to do this is with the trusty SWOT analysis - a strategic planning technique used to identify a company's strengths, weaknesses, opportunities, and threats - to help you determine where you're at in comparison to your competitors.
Kauffman also shares the same opinion: "Competitive analysis should play a central role in developing the business strategy. It's critical to have a deep understanding of the competitive landscape - not just who the players are but their strengths, weaknesses, positioning, and likely moves."
Once I have the data on the competitive landscape, I start filling out a SWOT analysis template:
Pro tip: Remember, SWOT analysis isn't a one-and-done deal. So, even if you conducted a SWOT analysis during the startup stage, I suggest doing it again while developing a business development strategy since businesses evolve, markets shift, and customer preferences change over time.
While SWOT analysis provides a bird's-eye view of the competitive landscape, I believe you can also find many granular but important details about business by taking a deep dive into your sales funnel, marketing mix, and customer experience.
In particular, you can look for clogs in the sales pipeline where potential customers are getting stuck. Or you can review your marketing efforts and see what's working and what could be improved. Finally, you could ask customers to identify unmet needs.
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Now it's time to don your strategy hat and craft effective strategies for each department to drive business growth. While the exact strategy depends on your business and its objectives, here's how it looks for different departments.
No effective business development strategy is complete without a sales plan. If you've already established a sales plan, make sure to unify it with your business development efforts.
Your plan should outline your target audience, identify potential obstacles, provide a "game plan" for sales reps, outline responsibilities for team members, and define market conditions. If you haven't created a sales plan before, I recommend checking out our free sales plan template.
Besides that, see if you can benefit from any technology improvements in the sales department. For instance, our data shows that 81% of sales professionals found AI to be helpful for reducing manual tasks.
If you equate strategic business development to only sales, you'll lack a steady sales channel to support your business development strategy.
After all, 96% of leads do their own homework before talking to a sales rep. So, if you don't have marketing content to attract leads, your well-trained sales professionals end up doing, well, nothing.
According to Kauffman, it's a prevalent issue. "Failing to have marketing expertise at the table from the very beginning, when initially planning and developing the product or business, is another common pitfall. Marketing should not be an afterthought - it needs to be deeply embedded in the overall strategy from day one."
I recommend cooking up some marketing strategies to:
While it might appear that business development means getting more customers, it doesn't have to be the case. You can also get more business from your existing customers since you've already earned their trust. In fact, our data shows that 72% of a company's revenue comes from existing customers.
While there are several ways to gain customers' trust, I recommend establishing a personal connection instead of relying on coupons, discounts, or free perks.
For instance, you can listen to customers' feedback and improve your product to fully win them over to your side.
Paul L. Gunn Jr., founder of the KUOG Corporation, agrees, saying that the "heartfelt action to go beyond the transactional to deliver a solution that speaks to the intangibles anchors them to often support a long-term relationship and make significant tangible impact."
Once you've got your strategies in place, it's time to get tactical. I recommend you start with identifying key initiatives and projects that will bring your strategies to life.
If you've already filled out our free sales plan template, your sales team will be well and ready. If you haven't, start doing so by assigning roles, tasks, and responsibilities to everyone on the team. For fleshing out your marketing strategy, I like using HubSpot's free marketing plan template.
If you like to work without a template, ensure your action plans include information on the following:
If you can't track your progress, you cannot know if your business plan for development is working. That's why setting clear metrics and key performance indicators (KPIs) is so important - it's basically a scoreboard for your business development efforts.
To start, identify the specific metrics that align with your business objectives and strategies. I usually find the following metrics incredibly insightful:
Gauri Manglik, CEO of Instrumentl, especially recommends tracking LTV to SaaS companies: "The key is that LTV captures both revenue and engagement over time, not just a snapshot. So rather than looking at new sales in isolation, I always encourage SaaS companies to make LTV their north star metric for business development."
Pro tip: After identifying the relevant metrics or KPIs, you can also set SMART goals for each to make tracking easier. Plus, you can create dashboards to visualize the progress against the KPIs. It'll make it easy for team members to see how they're doing and what they need to improve.
While I've already mentioned resource allocation during action plans, you must also approach resource management in a big-picture mode to execute your business development strategy seamlessly.
I recommend prioritizing the initiatives based on their potential impact and alignment with your business objectives. In other words, focus your resources on the areas that give you the most bang for your buck.
Beyond that, you must also take a hard look at your current resources. If you have any gaps in skills, expertise, or technology, fill those gaps first - by hiring new talent, investing in training, or getting a new tool.
For example, 63% of sales leaders share that AI makes it easier for them to compete with other businesses, so you might also improve your sales metrics by adopting an AI-powered sales solution.
Additionally, resource allocation isn't a one-and-done deal (like other things on this list), so keep a close eye on the ROI of different initiatives outlined in your business development plan and shift your resources as required. If something isn't working, don't be afraid to try a different approach.
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Since you've got a solid plan, a team of do-ers, and enough resources to pull it off, it's time to put all the strategizing and planning into action and watch the magic happen.
First things first, ensure all your plans have reached the shop floor - everyone knows their role and has the tools they need to crush it. Plus, don't forget to keep the communication lines open as situations arise to be on top of your game and fix the issue right there and then.
And once you have kicked things off, keep your fingers on the pulse and track your progress against the metrics and KPIs. It's like checking your GPS in a new city to ensure you're staying on course.
Lastly, remember to celebrate your wins along the way - whatever size they might be - to keep the team motivated and engaged for the long haul.
Since markets evolve, customer trends change, and competitors improve, a business development strategy is never a finished document. Instead, you must keep reviewing and updating your strategies to generate new business for your brand.
Here's how I approach it:
While navigating all the moving parts of a business development strategy might appear confusing, here's an example of a business development strategy I put together for an ecommerce store, "GreenThreads," which sells eco-friendly clothing and accessories.
Increase online sales revenue by 25% within the next 12 months by expanding product range and implementing targeted marketing campaigns.
Meet "Eco-Conscious Sam," a 24-year-old urban professional who values sustainability and ethical consumption. She's always on the lookout for fashionable clothing and accessories that align with her values, and she's willing to pay a bit more for high-quality, eco-friendly products. Sam is active on social media and loves to share her favorite sustainable brands with her followers.
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GreenThreads will measure:
If GreenThreads hits the 25% sales revenue, they can pat themselves on the back. Plus, product performance and CAC will tell GreenThreads how effective they were in expanding the product range and their marketing efforts.
With a strategic business development plan, you're not just throwing darts blindfolded and hoping for the best. You're investing your precious resources, time, and hard-earned money into initiatives that'll knock the socks off your short-term and long-term goals alike.
But don't take my word for it. Sit down with your team, break out the snacks, and start brainstorming your own master plan to set your business up for long-term success.
Editor's note: This post was originally published in May 2023 and has been updated for comprehensiveness.