How Has Covid Impacted Sales? Benchmark insights..

As I have been working with B2B client or prospect companies during this crisis, I've been amazed at one common pain we're experiencing in generating sales growth....namely in the email campaign and outbound lead generation process. Now that we have closed the books on Q2, I wanted to take a step back and assess what the market is doing, four months later.

How does the state of business compare today to where it was in March? How have teams changed their behavior to adapt to the new economic climate? What's worked, and what hasn't? And what changes are here to stay?

HubSpot recently published some pertinent data and trends into buyer interest, marketing and sales outreach, and sales outcomes (spoiler alert: there's a lot of engaged prospects out there, but sales teams have work to do in capturing that interest). Below are some summary points extracted from the study.

Q2 Snapshot

When COVID-19 began shutting down economies in Q1, businesses that already had an online presence were at a distinct advantage. The data shows steady and sustained growth in buyer engagement, and that businesses with an online presence were ready to capture that interest.

The story gets a little murkier once buyers actually start to engage with companies. Marketing teams have risen to the challenge of keeping prospects interested in a messy, chaotic crisis and met an audience of buyers who suddenly spend all day at their computer. While email volume has risen significantly — typically a no-no for teams hoping to keep their open rates up — open rates have risen faster than volume has grown, demonstrating that teams have been successful at providing relevant and helpful content.

On the sales side, things aren't going so well. Sales teams sent up to 60% more email than pre-COVID benchmarks. But response rates have been dismal. Marketing teams have been able to connect, but sales teams haven't. This is a huge area of opportunity for businesses as they enter the next quarter of COVID-19.

Customer-Initiated Chat

Sales teams have pivoted to chat to grow their pipelines, while customer service teams are leveraging this medium to manage the increased demand for support. With the exception of two weeks, chat volume has steadily risen week-over-week since the beginning of March, peaking at 45% above the benchmark in late-May. Total chat volume in Q2 outpaced Q1 by a notable 31%.

Every industry is trending above the benchmark when it comes to live chat. This is a positive sign that buyer interest is increasing, and that people are engaging with companies more frequently. The industries that have seen the strongest performance in Q2 are construction, consumer goods, human resources, and manufacturing, which all grew by 25% or more during this last quarter. Consumer goods and construction were certainly outliers in Q2, with both industries seeing a bump of 45-50% in volume.

Sales Emails

If Marketing's job is to identify buyer interest, Sales is responsible for finding the prospects in that pool who will eventually become customers. Hub's data revealed while sales outcomes are improving, sales prospecting has fallen short of its potential.

The number of emails sent by sales teams experienced an immediate and dramatic uptick following the pandemic declaration. From early-March to late-April, sales teams pushed hard to generate pipelines, leading to a 42% increase in email volume. Compared to Q1, sales teams sent 44% more email in Q2. Today, global sales email volume is at an eye-popping 59% above the pre-COVID benchmark.

The problem is that customers aren't responding to sales emails the same way they're responding to marketing ones. Like marketing, sales teams increased their email send frequency following the pandemic declaration. But, unlike marketing, their response rates fell significantly during the week of March 16, and have hovered at 25-30% below the benchmark ever since.

Response rates dropped 24% in Q2, even as email volume fluctuated throughout the quarter. As sales teams increased email sends, customers began to tune these messages out or even mark them as spam in their inboxes. So far, it seems if email send rates remain this high, we can expect response rates to trend in the opposite direction.

Two industries — construction and consumer goods — have really stood out. In Q2, both more than doubled the number of sales emails sent compared to Q1, are still well above the benchmark despite some decline in volume during June. Their response rates have been correspondingly lower than the global decrease, with both industries receiving 33% fewer responses in Q2 than Q1.

Email prospecting, to put it bluntly, is out of control. It's easy to send thousands of emails with just a few clicks, and in a chaotic time, we understand why sales teams are sending so many. But volume and quality is a tradeoff — the time a team saves by sending out email blasts is wasted if that outreach isn't personalized, relevant, and helpful. These gaps are clear in the data. At this point, sales teams should be working closely with marketing to understand how they can improve their email engagement rates, and sending far less email.I would add the use of targeted social ads, messages and other social channels should be used as well.

Call Prospecting

As both marketing and sales email volume went up globally, call prospecting plummeted, falling to a low of 27% below the benchmark by the week of April 6. This has been trending upward since, as call events are now at 9% below pre-COVID levels. However, the total number of prospecting activities (email and calling) has increased by 19%, and the shifting ratio between calling and emailing is revealing. In Q1, the ratio was closer to 1:1 while in Q2, sales people sent more than twice as many emails as they made calls. Sales teams will need to return to their pre-COVID balance in order to see improvements in response rates

Sales Outcomes - Deal Creation

New deal creation took a nosedive in March, as companies paused "business as usual" to understand what cutbacks and operating changes they'd need to weather the pandemic. Globally, the number of new deals created was at its lowest point the week of April 6, where 30% fewer deals were created compared to pre-COVID levels. Overall, the number of deals created in Q2 is 8% less than the number of deals created in Q1, and this trend is reflected in all regions and company sizes.

More recently, this metric has been on an upward trajectory globally, though this growth has been volatile. In the 11 weeks since April 6, eight weeks have seen week-over-week growth in deal creation, while three weeks have seen week-over-week decline. The number of deals created have increased for each of the last four weeks, and businesses are hoping that this trend will hold.

Deals Won

Globally, the number of deals won is trending upward as well, and was 8% above benchmark the week of June 22. Like deal creation, this metric has been highly variable since its lowest point — also the week of April 6, when it was 36% below pre-COVID benchmarks. Deals won has seen week-over-week increases for 10 out of the last 11 weeks.

When comparing Q2 to Q1, this metric lagged slightly behind new deals created in its climb toward pre-COVID levels. There were 11% fewer deals won in Q2 compared to Q1, with variability among regions, industries, and company sizes balancing out to that number. As deal creation is a leading indicator of future revenue, this trend is to be expected.

Companies with 0-25 employees are closest to Q1 volume, at only 5% fewer deals won in Q2. Companies with 26-200 employees won 17% fewer deals in Q2 than in Q1, while companies with 201+ employees won 16% fewer deals.

Takeaways

1. Invest in chat.

As many businesses move online for the first time, live chat numbers have skyrocketed in a few industries: construction, consumer goods, and manufacturing. The next few months of the pandemic are, by all expert accounts, uncertain. But we can say that there will be a significant change in how structurally affected industries operate in the future. Many companies who have transitioned online recently will remain online in the future, and this is an investment businesses will be thinking seriously about.

Investing in chat is not only a way to capture the significant uptick in online buyer interest, it's also a long-term play to help scale your business. Even simple chatbots can take the manual work of basic qualification screening, meeting booking, lead routing, and even simple customer service tasks off your team's plate, leaving them free to focus on higher-value activities.

2. Shift prospecting away from quantity and toward quality.

The ratio of call prospecting to email prospecting was almost 1:1 before the pandemic. Now it's closer to 1:2. But response rates are historically low for the non-holiday season, a disconnect between marketing and sales performance that cannot be explained purely by the economic downturn. Salespeople are prospecting 19% more than they were in Q1, and the quality of that outreach has suffered as activity has increased.

Calling is inherently a forcing function in quality sales prospecting. It's almost not worth it to get on the phone unless you do some research, and that background is key to building rapport, qualifying (and disqualifying), and connecting with buyers. In the age of COVID-19, your entire qualification framework should change — a product that would never have been considered pre-pandemic could be business-critical today, and vice versa. Rethink what a "good fit" looks like right now, create crisp disqualification frameworks to work through leads efficiently, and reprioritize prospecting appropriately. Sales should also be borrowing tactics from marketing -- personalization through content, adding a personal touch through video, and prioritizing help over selling.

This ratio also reveals a broader principle sales leaders would do well to remember. Part of sales will always be a volume game, and it's pointless to deny that. Adopting automation and software cuts down on the time the team has to spend manually sorting leads, and frees them up to feel secure in taking a slower approach to prospecting. Prospecting must be worked from an individual and an operational perspective, and can't succeed without investment in both processes.

3. Mix your cadence and channels while linking the key value message

We see this with our clients, when they align the same key value messages across all the various prospecting channels they have much greater success with prospect engagement. Make sure to keep the messaging personalized and relevant to pains they and their peers are experiencing with how you help.

To learn more about the trend data, visit this link:

To discover additional growth insights and have a personalized brief set up for your situation, please contact Matt via mslonaker@mattallendevelopment.com