In this Issue

💌    Sales Should Be Easy
📈    The Rule of 40
📍    Manage Conversion Points

💌  Sales Should Be Easy

When you’re banging your head against the wall, grinding it out for every lead… every conversation… every sale… is a clear warning sign: Sales shouldn’t be this hard.

Sales is hard when you have poor product-market fit. If customers don’t get it, don’t value it, or don’t want it, they don’t buy.

For instance, in 2020 Sticky Branding launched a new service, Crisis Marketing, with the mission to “recover the customers and revenue taken by COVID-19.”

We offered the service in two formats:

1. Direct strategy consulting
2. A group program for 8-15 companies

We thought the group program would be a slam dunk, but nobody bought it.

In addition to a full marketing campaign, we made over 500 cold calls and direct solicitations to sell the group program. Only to sell 1 customer!

Meanwhile, over 15 weeks we acquired 12 customers for strategy consulting.

The market clearly told us what it wanted to buy. We quietly killed the group program, and we doubled down on direct strategy consulting.

The mistake companies make is not listening to their market and holding on for too long. When selling your services is hard, investigate your product-market fit. Is it really what your customers want?

It’s not easy to change your business or your offerings, but that may be what the market is signaling to you if sales is so hard.

One Stat to Watch

16.5%

The percentage of online generated sales has fallen from 19.4% in 2020 to 16.5% in 2025, according to CMO Survey.

📈  The Rule of 40

It’s tricky to find the right balance between profit and growth.

The worst case scenario is a growing company that makes no money. You will hear the entrepreneur lament, “Everyone gets paid but me.”

In the software industry, there is a sage principle known as the Rule of 40. It is considered the gold standard of revenue growth and profit.

The rule dictates that a company’s revenue growth rate plus its EBITDA (profit) margin is greater than or equal to 40%. For instance:

• Balanced Growth: 20% Revenue Growth + 20% EBITDA Margin = 40%.
• High Growth: 50% Revenue Growth + -10% EBITDA Margin = 40%.
• Low Growth: 5% Revenue Growth + 35% EBITDA Margin = 40%.

The Rule of 40 guides a team to balance growth with profitability to create value effectively.

British statistician George E. P. Box said, “All models are wrong, but some are useful.”‍

The Rule of 40 may not translate well to every business, but it can be adapted and set as a guiding target for your growth strategy. In the mid-market, a revenue growth rate of 15% with 25% EBITDA margin sets a balance of reinvestment and high growth.

If those numbers are too aggressive, then try dialing them back to 35% or 30%. Set a balance of growth and profit that pushes your company to the next level.

📍 Manage Conversion Points

The sales manager’s mantra has always been, “Make more calls.” But more calls isn’t a good behavioral sales metric.

Calls that don’t connect, don’t convert, or don’t advance the customer are a waste of time. You don’t need to track this work. 

Instead, focus on a concrete conversion point in the sales process:

• Demo
• Estimate
• Quote

These points are better milestones to evaluate your marketing and selling effectiveness. For instance, it’s hard to write a quote if you haven’t qualified the prospect first.

Managing to sales conversion points lead to better prospecting and marketing strategies: What are the activities and campaigns that actually drive generating demos, quotes, and estimates?

🤔  Thoughts on Today’s Issue?

We’d love to hear your feedback. Message with any thoughts, comments, or ideas for future issues.