London leads the way for growth but risks abound
by Rory Traynor
If you want a successful sales team then it needs to be built on a solid foundation.
That foundation is B2B data.
Your company needs detailed, accurate and up-to-date information on clients and prospects. If it doesn’t have this then it will cost you time, money and resources.
This ultimately impacts your revenue and makes your company less sustainable.
This article lists common red flag warning signs that your B2B data is of poor quality.
1.Spending Too Much Time Updating Your CRM
In the past, B2B data was sold to companies in spreadsheets. Businesses would buy the information based on the number of contacts or the number of data fields. The data wouldn’t change unless the buyer updated it themselves or bought new information from a b2b data provider.
This is known as static data, so-called because it represents a snapshot in time.
The problem with this approach is that the data begins to go out of date the moment you buy it.
That’s because the business landscape is constantly changing. Company directors will move on, the business’s fortunes wax and wane, and some might even close down or move premises.
Over time, static data becomes more of a hindrance than a help. Each time your sales team makes a call and the data is incorrect, they need to spend time updating the entry. Worst still, it could also mean that they have wasted time pursuing a prospect that is no longer suitable.
If this is happening to your sales team, it is a big red flag that you need to improve your B2B data.
Companies could buy new data more often, but this will cost more and doesn’t completely solve the problem.
Solution: Get a Source of Real-Time Data
Real-time data is when the information in your database is updated as soon as the official sources are.
For example, if a company files for insolvency with the UK courts, a real-time data service will update your information on that business as soon as the file is published in the public records.
This means your sales and marketing teams don’t have to spend any time updating records. Instead, they can focus on making calls, safe in the knowledge that the data they use is up-to-date.
Some real-time databases even connect their API to your CRM, meaning that all your customer information is updated daily.
2.Chasing Unqualified Leads
Winning new clients relies on tight coordination between sales and marketing. The sales team should know that the leads they approach are the right fit for the company.
If these leads are a poor fit, the team’s win rate will suffer.
But it doesn’t end there. They may win some of these poor-fit leads. This is a disaster for the company as it leads to accounts that are hard to service, low customer satisfaction and poor retention rates.
Ultimately, the whole company becomes less efficient.
There are three possible reasons why your sales team is wasting time on unqualified leads. First, it could be that your data is out of date—we’ve already discussed this in the section above.
Here are the other two reasons:
Poor segmentation
You don’t have clear, granular ideal customer profiles (ICPs).
Your data isn’t detailed enough
Your data does not provide enough details to differentiate between a poor-fit lead and a good one.
Solution: Use Granular Data to Create Accurate ICPs
If your company is suffering the issues described above then it is a red flag that your B2B data isn’t detailed enough.
A good B2B data provider won’t just provide you with financial data taken from Companies House reports. They will enrich this data with additional information and their own calculations to give you a highly detailed picture of each customer.
Having data like this lets you to do three things:
- Create granular ICPs: This allows you to segment the market and only target the best leads.
- Produce targeted sales lists: These lists comprise companies that perfectly fit your ideal customer profiles.
- Use segmentation and personalisation in your campaigns: One message won’t work for all audiences. Segmenting audiences and personalising messages is key to achieving better conversion rates.
Now, your sales team has a constant flow of best-fit leads. They can quickly qualify them or move on to the next prospect.
Here are a couple of examples of the kind of granular data that will help you define your ideal customers:
SIC codes
The SIC codes used by databases like Companies House are usually vague and don’t provide a clear idea of what a company does. A good data provider will break these designations down into more accurate codes—this is a critical factor when deciding whether to add a company to your prospect list or not.
Micro entities
These are small companies that fulfil at least two of these requirements:
- Ten or fewer employees.
- A turnover of less than £632,000.
- Less than £316,000 on their balance sheet.
Companies like this do not have to file full accounts with Companies House, which means it can be difficult to get detailed data on them. The trouble is, according to the House of Commons Library, there are over 5 million of these companies. A good data provider will be able to fill in the gaps in data for these companies.
3.The Sales Process Takes Too Long
According to a study from Demand Gen Report, 68% of B2B professionals say sales cycles are taking longer than they did a year ago.
There are many reasons for this, including:
Too Many Decision-Makers Involved in the Buying Process
The rise of video conferences makes it easier to get lots of people involved. This leads to disagreements amongst stakeholders and actually slows decision-making.
Lack of Differentiation
All products in your target market are too similar, making it hard to differentiate between solutions. This usually leads the customer to delay their decision or to make it based on price.
Value Is Not Communicated
The customer understands what the solution does but not how it will help them or their company. This can also lead to difficulties selling the solution internally.
Customers Are More Aware of What Is Available on the Market
Buyers do their own online research before speaking to a salesperson. They go into sales meetings thinking they know what they want. If they’re wrong, it may take some time for the salesperson to correct the customer’s view.
Ideally, your salespeople need to agree on a deal (or get a rejection) within two touchpoints. This ensures they don’t spend too long trying to get the deal over the line.
The issues listed above are common red flags. They indicate your sales teams’ pitches don’t address what really matters to the customer.
Too many salespeople focus on their product’s features and functions in their pitch. If your product is too similar to that of your competitors then you won’t stand out.
You need to find a way to differentiate your sales pitch.
Solution: Use Data to Focus on What Matters to the Customer
Buyers want to work with salespeople who understand their company. So if you’re able to show that you know the challenges facing them, then you will stand out from your competitors.
A good company data provider will help you understand the overall challenges facing a company. You’ll understand their financial pressures, where they are succeeding, and where they might need help.
This information allows you to connect your product or service to the customer’s pain points and create a more compelling sales pitch.
For example, if you can see that the customer’s asset value has increased over the last year then you could explain how your solution will help them to better manage their new premises or equipment.
4.Prospects Fail Onboarding
Sales and marketing teams put lots of time and resources into generating leads and taking prospects through the sales process.
So it’s a disaster if these potential customers then fail credit checks during onboarding.
Not only have you lost a potential customer and wasted time, but you’ve also annoyed them too.
The problem is that most business leaders we meet approach onboarding as a reactive function that takes place after the sales process.
This can and should be turned on its head.
Solution: Build Credit Checks into Your Prospecting
Companies need to build their customers’ financial health into their ICP.
This way, during prospecting they can choose to only approach those companies that would pass a customer credit check.
This makes credit checks at onboarding a formality and the failure rate will drop dramatically. With more prospects getting accepted, your sales team’s efficiency will increase and your customers will have a more pleasant onboarding experience.
It’s also worth noting that financially secure businesses usually make better clients because they are likely to pay on time and may have more chance of growth or increasing spending.
To do this, you need a B2B data provider that allows you to:
- Run credit checks based on detailed financial health ratings.
- Produce sales lists based on your ICP.
- Connect the two.
5.Your Competitors Beat You to Opportunities
Timing is a major factor in sales. If a company faces an issue, the first salesperson to contact them with a solution has the advantage.
But what happens if your competitors have larger teams with greater reach? They will be more likely to stumble on these opportunities before you.
The key is to beat them to the best opportunities. But companies don’t shout about the challenges they face, so how can you know when they come up?
Solution: Use Triggers to Identify Opportunities
A good B2B data provider will enable you to set up triggers. These notify you of changes in a company’s data that signify a potential sales opportunity.
Let’s say you prefer working with companies with 100+ employees in the North East. You’ll receive a notification whenever a company there expands its workforce over this threshold. You would also get one if a company of this size opens new premises in your area.
You can then add the company to your prospecting list.
You can trigger even more specific opportunities. For example, if you sell buildings and contents insurance, you can set up triggers to tell you whenever a company’s asset value increases. You can then be the first to get in touch with services.
Triggers allow you to strike faster than your competitors. But they also allow you to follow up on a change immediately, meaning you reach the customer at a point when the situation is still fresh in their mind. This means they will be more open to potential solutions.
6.Customers Go Out of Business or Don’t Pay Invoices
It can be devastating for your company if a customer can’t pay bills or is liquidated.
The lost revenue can impact company financial projections, which can lead to staff cuts and loss of profits, as well as curtailed growth.
If you invoice your customers or extend credit to them then the threat is even greater.
If a customer enters insolvency and owes you money, you are unlikely to get any of it back. Instead, your company will be forced to absorb the loss as bad debt.
Companies that experience this sort of loss are three times more likely to become insolvent themselves within 12 months than they would otherwise have been.
This is a common occurrence. Every week thousands of UK companies go insolvent, leaving a trail of bad debt worth billions of pounds each year.
Solution: Monitor Your Clients’ Financial Health
A good B2B data provider can help you avoid losing money from your customers experiencing financial difficulties.
Their data allows you to monitor your clients’ financial health. This allows you to see if their financial position deteriorates. You can also use monitoring alerts, so you’ll know as soon as there is a problem.
You can then take proactive action to protect your company. This could be as simple as monitoring the client closely. But more stringent action might include reducing the client’s credit allowance or even calling-in invoices.
7.Failing to Manage Regulatory Requirements
Governments around the world are putting an increased focus on anti-money laundering (AML) regulations.
UK businesses in regulated industries face increasingly stringent requirements when it comes to know your customer checks and customer due diligence.
Furthermore, the war in the Ukraine and the resurgence of the Taliban in Afghanistan mean that more people than ever are on sanctions lists. If you work with companies connected to these individuals then you could be breaking the law.
Your business must have adequate systems and procedures in place to fulfil and manage your AML obligations or you could face a fine or even prison.
If your company has received a fine or a warning from your industry regulatory over AML breaches then you need to take action.
Solution: Use Data as the Backbone of Your AML Procedures
Having in-depth B2B data on the companies you work with gives you information on corporate family trees and ultimate beneficial owners—vital information in the fight against money laundering.
Your B2B data provider should provide you with a full AML service, from ID verification to secure audit trails.
Get the Best B2B Data With Red Flag Alert
Spotting red flags in your B2B data is hard. If you are a busy sales or marketing manager, you probably don’t have time to address each of the things mentioned in this list.
The best thing to do is get a B2B data provider that will give you the most accurate and up-to-date company information available.
Red Flag is that provider. We help your company accelerate growth, avoid financial risk, remain compliant with industry regulations, and increase efficiency.
- 20 million key decision-makers.
- 100,000 data updates every day.
- 100+ indicators of financial health.
- 50+ filters of key company data.
- 7 detailed financial health ratings.
- 2.6 million telephone records.
- 100+ indicators of financial health.
Book a demo today to see how the Red Flag Alert B2B Prospector tool can help your company build high-quality B2B lists that fit your ideal customer profile.
