What is a Revenue Engine in Business (And Why You Need One in 2022)
This post recaps a workshop presented by tech sales and revenue expert Mike Simmons on the topic of creating a revenue engine for your startup, which requires the right balance of strategy, clarity, and customer development. Mike has worked with major and publicly held companies, including Intel, Microsoft, the Walt Disney Company, and hundreds of small and mid-sized enterprises. He has worked in the field for over 22 years and brings with him a long record of success in helping business owners break through their barriers and thrive.
In this video, Mike discusses how to turn your business into a revenue engine that is consistently profitable. These strategies are recession-resistant and evergreen, giving you a solid framework for success that you can use across both B2C and B2B businesses.
Enjoy the full video, your skip below for the key takeaways of this session.
If you’re looking to work with a sales and revenue specialist, be sure to check out Mike’s GrowthMatch profile.
- Businesses are essentially revenue engines that you can continue to refine and optimize for greater profitability
- There is no map to business success. Every business requires different parts to build its engine.
- Revenue engine creation and success rely on the right parts being used at the right time and in the right context.
- Before you launch your business’ revenue engine, you have to identify your revenue paths
- A common revenue path is purchases and clients within your close network, as these are safer and more common among startups or smaller enterprises
- Secondary to your close network, you might also slowly expand into partnerships as you find new ways to contribute and bring enhanced brand awareness to your company
- Continuing through the acquisition, retention, and expansion steps can help you to secure more regular and profitable business
- The key to success in your revenue engine is a focus on building relationships rather than securing sales
- The more that you broaden your revenue paths, the more areas for potential revenue engine optimization that you’ll have
- Avoid analysis paralysis as you go through the engine refinement process. Make decisions and track results to further iterate and optimize
Building Your Revenue Engine (2022)
Mike went on to explain the four main steps to building and using your revenue engine for maximum market impact. We’ve summarized them below:
1. Determine what your revenue engine model will look like
- Every model has a structure that works for that specific market, niche, or business.
- Avoid “perfection paralysis” while choosing your structure. You can always change it later.
- Your revenue paths will inform the structure of your model
- Create your steps and model with the customer journey and experience at the center, rather than a purely business-focused or operationally-focused approach
- When creating your model, ask yourself:
- What drives your business?
- How do you maintain that vertical growth?
- What steps need to be present in the model in the customer experience to take them from customer prospect to customer advocate and enthusiast?
- What are the steps in the customer journey, and how can you tailor your brand perception to be optimized at every stage?
2. Assemble your engine and use strategic “failsafes”
- Build in flexibility to your revenue engine model. Allow for mistakes, shifts, and room for new ideal customer profiles (ICPs)
- Don’t ever assume that you are done iterating or refining. Technology, trends, and preferences continue to change across industries. Remain agile and open-minded for business-boosting shifts
- Continuously test and evaluate your processes for best results.
- After your testing processes, develop ways to take action on and summarize your data
- As you put your failsafe measures in place, work on identifying areas of potential failure. The question to ask as you do this is:
- How can you remove friction from the customer’s experience with your brand?
3. Evaluate your engine and optimize its performance
- Don’t be afraid to continually question if the pieces “fit” for both customers and your team members
- If they don’t fit, determine if the time it would take to create a fit will be both profitable and in the best needs of the business
- Avoid analysis paralysis in this step as well. Don’t be afraid to be decisive. It will never be “too late” to act on a new idea.
- Qualify your new prospects and ICPs with lists of tools that help to determine the proper fit for future success
- Lean into leaner processes to continue to put the customer experience first
4. Create an ongoing need for your solution
- Identifying customer-minded “compelling events” can help to make your revenue engine more profitable and efficient
- Shifting messaging, experience, and other marketing elements to suit each group of customers at every point in their unique journeys can help you to better understand and reach your target audience.
On behalf of the team and community at GrowthMatch, we want to send Mike a huge thank you for sharing his knowledge with us. If you want to work with a revenue specialist, you can visit Mike Simmons’ profile here.