At first glance, there doesn’t appear to be much distinction between business development and sales. Aren’t both activities geared towards generating more profit for the organization? Isn’t a sales team developing new business each time they make a sale?
In fact, there’s a significant difference between these two critically important activities. As business author Hans Peter Bech notes, “Failing to distinguish between the two situations … will result in unfocused market penetration, unpredictable sales cycles, unpredictable revenue forecasts [and] fluctuating revenue and processes that are impossible to repeat.”
In other words, companies ignore the difference between business development and sales at their own peril.
The Role of Business Development
Unlike sales—which is generally geared towards short-term success—the role of business development is to “build a strategic relationship with partners who in turn boost sales by selling products to customers in a more effective way,” according to Marketing 91. The business development process integrates a range of activities that includes “expanding the business, exploring new market segments and providing more benefits to the current customer base.”
Other key aspects of the business development process include:
- Establishing the most effective definition of a company’s unique selling proposition
- Identifying the most efficient channels of communication
- Determining the ideal lead generation process
“The objective is not revenue generation, but finding the right product-market fit,” says Hans Peter Bech.
How Sales Fits In
As should be clear to every business owner, the role of sales is to “close deals with the qualified leads that are coming from either your business development efforts or other lead generation strategies,” according to Close.
A company’s sales strategies and operations should never be set in stone. These activities must be constantly reviewed, altered, scaled and enhanced in order to meet changing marketplace conditions and to stay ahead of the competition.
How Business Development Can Lead to Sales
Among experts, it’s generally agreed that business development—with its emphasis on the “big picture” of long-term strategic growth—should come first in terms of business priorities. A focus on this process can yield a greater volume of qualified leads (for future sales), possibilities for new target markets, and established partnerships that also pay off in the long run.
So what activities fall under the umbrella of effective business development?
Market research is a key element of business development. You and your executive team should be well-versed in all aspects of your industry (including geographic factors and market segments). To further understand how the competition fits into this bigger picture, have your marketing team compile information from industry blogs, forums, social media, and the competitor’s own public materials.
Ideally, this type of intensive focus will generate insights into better ways to compete with your business rivals—as well as understanding how your business can more effectively differentiate itself from the competition. Being able to articulate that differentiating factor will be enormously useful to your sales team.
Also, explore the opportunities offered by advances in technology. With the right tools, you can craft marketing campaigns that appeal to segmented target customers. You can also devise premium offers and other special discounts that gain the interest of prospects who might otherwise sit on the fence with respect to your sales efforts. The right CRM software also helps you monitor sales activities, follow-up contact with quality leads and management of your sales pipeline, so that sales remains aligned with your overall strategic goals.
Find out more about business development and sales by participating in a free TAB Boss Webinar, “How to Grow Your Sales and Profits by Utilizing Sales Enablement.” In this webinar, scheduled for July 23, you’ll learn how sales enablement—delivering more effective sales conversations and relevant content—leads to increased buyer engagement and increased win rates.