Is what we’re doing efficient?
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Growth at all costs is dead and buried. We live in an efficient growth world now.
The problem? Looking at the current reality, efficient growth has never been further away.
Sales cycles are expanding, conversion rates are dropping, and creating opportunities is harder than ever before.
All of these are massive inefficiency drivers.
So while we all want efficient growth, the current baseline data tells us that it’s not going to work out for everyone.
So what’s the answer, Toni?
It’s time to assess the different channels and markets you have now, figure out which are efficient (and more importantly, which aren’t), and start trimming down to the level you can afford.
Think of it like drilling for oil.
Say you go to Texas, drill a hole in the ground, and set up a cheap but efficient pump.
Now you see that the price for a barrel of crude is going up, and your Texas operations are pretty much already at peak, so you expand out.
You head to Alaska, where you need to invest in better technology and experienced people to get it out of the frozen ground (it’s always cold in Alaska, right?).
Next, the price of a barrel of crude keeps going up, so now you look at nearshore and offshore oil fields in the Gulf of Mexico. Again, it’s much more expensive to get to that oil, but the economics of the situation more than makes up for it.
Now all of a sudden, the price of crude collapses.
So what do you do?
Well, you take a serious look at your operation.
You stop offshore operations because it’s too much to keep up.
You scale down your Alaska operation because you can’t justify the cost.
And while small, you will again fall in love with your Texas pump!
And yes, you’ll produce much less oil than before, but you’ve cut out all of the expensive stuff, and the oil you’re producing is the most efficient in your entire operation – matching pretty much what the market is paying for.
So how does this translate into our world?
See your GTM as a system that has very similar layers. Texas is your brand, word of mouth, and existing customers.
Alaska is maybe your SEO and Search Ads.
Near and offshore drilling is your Linkedin Ads, Outbound, Conferences, etc.
When “the market,” aka the VCs, were willing to pay a lot for a dollar of revenue (aka valuation), you could afford to use all the expensive tactics.
But the barrel of crude price for your company has dropped, so you will need to scale down the expensive channels.
Sure, you will find some efficiencies here and there, but I have rarely seen anything in the order of magnitude you might need.
By cutting down on those channels, you can also reduce the team down stream. E.g. AEs, Inbound SDRs, CSMs, Managers… etc.