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The Ultimate Guide to RevOps

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The Ultimate Guide to RevOps

April 28, 2021

What is Revenue Operations?

The RevOps department heads up full-funnel operations across marketing, sales and customer success, with one focus: to drive growth through operational efficiency across the customer lifecycle. This department is typically made up of members from Sales, Marketing, and Customer Success functions with their objective being to operationalize every aspect of an organization’s sales process. This includes things like getting leads in faster through marketing campaigns (i.e. ad campaigns and nurturing programs), maximizing the efficiency of Sales through automation, and identifying churn risks before they happen.

What is the need for a RevOps department?

Companies today are finding themselves with more data than ever before, but struggling to make sense of it. This is leading to inefficient workflow processes, miscommunication among departments (i.e. Sales and Marketing), and ultimately a loss of revenue as a result. RevOps is the solution to streamlining all of these processes into one team to achieve operational efficiency.

For example, let’s look at the following hypothetical company: Company X. Company X’s sales reps struggle to manage their pipeline and properly forecast throughout the year. The company has limited visibility over its marketing efforts which means it has no control over lead generation. They are relying heavily on free trial users through freemium products or partnerships with other companies, which means they are missing out on a lot of opportunity. Finally, they are struggling with a difficult to close demo-to-purchase process that is heavily reliant on their customer success team.

Now let’s look at the same company with a RevOps department: Company X+. The RevOps department manages each step of the sales cycle including pipeline management, forecasting, lead generation, and lead nurturing. They are using granular data tracking and automation to improve the flow of leads going into Sales from marketing. They have optimized the trial to purchase process to remove human error and streamline the entire process. Ultimately, the RevOps team is looking at every aspect of Company X+’s sales and marketing efforts to drive more growth through operationalization.

Who needs a RevOps department?

More often than not, organizations with high customer churn rates have low revenue per customer. In addition, the cost-per-customer is higher than it could be. These companies need visibility into how they are spending their money across the customer lifecycle to maximize the investment they make in each individual customer.

For organizations in the business-to-consumer space, a RevOps department will be focused on driving customer acquisition, driving lifetime value of the customer and ensuring that current customers remain loyal. For business-to-business companies, this department’s focus is on driving cross-sell and upsell revenue from current customers as well as increasing referrals.

The RevOps playbook

At its core, the role of RevOps is to set the full lifecycle revenue goals for an organization. The role then identifies the people, and then drives operational activities to help the company achieve these goals.

Some organizations will continue to have a product marketing focus in addition to RevOps. However, depending on the specific department’s goals, it may be that product marketing is only part of the job and RevOps takes over as the main focus for the customer lifecycle.

An operations-focused RevOps team works closely with product and software development teams to ensure that product roadmaps are good, that the systems are secure and that the right features are built to enable RevOps to do its job. This can be more challenging than it sounds because of the different languages needed by customers to achieve success.

The RevOps organization can be complex. Rather than manage external customers, these teams must work with an even more complex set of internal customers: marketers, sales, customer success and the broader organization.

For example, the RevOps team may need to work with marketing to develop a clear value proposition for customers and build an operational strategy. The team might need to work with sales to align on key metrics. And it might need to work with customer success teams on planning new channels or programs to activate customers. Internal teams (e.g. sales ops, CRM, marketing) will tend to have their own KPIs that often do not align with the customer lifecycle goals of RevOps. This means that the RevOps team needs to ensure it can work with these teams to align on common metrics and KPIs.

Any RevOps department worth its salt is data-driven. The key metrics for a RevOps team are the full lifecycle revenue metrics: acquisition, activation, retention and upsell. The marketing and sales teams can provide anecdotal evidence on these metrics, but this is not sufficient for RevOps to ensure that the company is making progress.

Understanding what drives acquisition is just the first part of the puzzle. The second part is understanding how all of the teams will work together to achieve these goals. For example, a product company may need to align with sales in order to develop lead-generation campaigns that fit a sales team’s cadence and get maximum value from each individual campaign.

In the most advanced cases, RevOps will have a deep understanding of which products are being sold and at what price, and even which customers are being upsold or cross-sold within the organization. Today’s RevOps teams also have a strong understanding of the full cost of customer acquisition – not just marketing spend, but also sales spend as well as all other touchpoints with the customer.

Successful RevOps departments coordinate across different departments in order to ensure they understand how different teams contribute to customer success. By integrating all of the data and measurements from across the customer lifecycle, RevOps teams are able to understand which programs generate the most value for the company, how each program can be optimized and how programs can be measured against success.

Success Stories

The RevOps department comes into play as companies work to close the gap between marketing and other departments as well as optimize processes that will enable growth. Here are a few examples of recent RevOps wins.

  • Making marketing and product better partners

RevOps can have a significant impact on how teams interact and work together to achieve the highest levels of growth. A company we work with has a product that helps people be more creative in their thinking. When the technology was first developed, it was primarily marketed to creatives, such as actors, designers and writers. However, as the product evolved to solve a broader set of problems in different industries, it became clear that business leaders could benefit from creative thinking as well.

A new RevOps team was established to coordinate across different teams and align on ways to build the business. The marketing team partnered with the product team to develop new campaigns that targeted business leaders. The operations team ran new, targeted ad campaigns in these industry verticals.

The result? A RevOpssuccess story in which the company is seeing a 20 percent conversion rate on these higher-value customers. This has led to an increase in revenue from this target group, up by more than 100 percent year over year.

  • Improving the onboarding and activation phase

In another example, a product company wanted to ensure that its customer support team was top-notch. Prior to setting up a RevOps team, this company had a three-month onboarding process. The goal of the RevOps team was to reduce the time to onboard and activate new customers by 50 percent.

In order to do so, the RevOps team developed a scoring system for customer support requests. If a customer support request had a higher score, the ticket was assigned to support engineers right away. Only tickets with lower scores were sent to an onboarding queue that included clear instructions on how to minimize future requests.

The RevOps team also added transparency to the process by updating customers on their status, including estimated timeframes for response and expected resolutions.

Top Considerations for RevOps teams

Now that we’ve talked about what a ReOps team does, let’s talk about which problems RevOps teams have to tackle. For now, RevOps departments are only in companies with at least $10 million a year in revenue. But as more companies adopt organic marketing practices, we expect to see RevOps teams in many more companies.

RevOps Teams

Here are some questions RevOps teams should consider:

How do we maximize customer lifetime value and revenue? What is the best way to build a business? What is the best way to convert customers into paying customers?

Once a company knows what metrics they’re aiming for, they can develop strategic initiatives and tactics to reach these goals. RevOps teams create campaigns, generate new ideas and test new hypotheses. They are responsible for gathering data from all sources to determine if these initiatives led to results.

And finally, RevOps teams are responsible for measuring success. They take the results of A/B tests, customer surveys and sales data to use as benchmarks and proof points for organic growth strategies. This also makes it easier to optimize marketing efforts and improve performance.

The biggest advantage of RevOps teams is how they help companies build a long-term strategy that scales because it’s driven by customer acquisition as opposed to bottom-line growth.

Conclusion


Setting up a Revenue Operations department is the best way to maximize the growth of your organization. By collaborating with all parts of the company, RevOps teams are able to build a strategic plan that drives customer acquisition and retention. However, getting started with RevOps is not an easy task and requires buy-in from leadership.

The process begins by identifying which department you want to operate more efficiently, whether it’s marketing, sales or customer success. After identifying that department, the next step is creating a strategic plan for RevOps to streamline and optimize revenue. Finally, RevOps needs to be integrated into the rest of the company using KPIs and data from different departments.

RevOps is clearly on the rise. Companies need to determine whether there is an opportunity for RevOpswithin their organization. If so, they need to decide if it’s easier to add this department in-house or use a third-party provider. If you don’t have the in-house resources to take on this task, it’s probably time to hire a RevOps team.



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