What is software for managing revenue?
RevOps software, which stands for “revenue operations software,” is a group of tools that help companies handle the whole revenue process. It brings together marketing, sales, and customer success efforts, from finding new customers to keeping old ones, so that each area is responsible for how much money it brings in.
- Some important parts of the RevOps software are:
- Getting leads and managing them
- Automation of sales
- Scores for deals
- Know-how about the market
- Managing customers who leave and those who stay
- Making customer success possible
- Automating processes and managing work flows
- Attribution of revenue
- Reporting and predicting income
- Analytics and reporting driven by AI
RevOps software does a lot of different things. Its main goal is to make money, so it has many features and tools that are meant to make every part of the income lifecycle better.
Basically, it combines all of these things into one platform, which means that businesses can see how their income is doing from every angle without having to switch between apps and technologies.
Like words
- Platform for managing revenue
- A method for revenue operations
- Software for RevOps
Why sales teams depend on RevOps software
Revenue teams are made up of experts from different departments who work together to increase the company’s top-line revenue. They keep an eye on every part of their business’s revenue success.
Unfortunately, it’s not that easy to do. It can be hard to keep track of everything when there isn’t a single source of truth. There are many departments, stakeholders, goals, and methods to consider.
RevOps software is used by sales operations teams to do the following business tasks:
Creating and carrying out plans for marketing and sales.RevOps software can be used to handle and keep track of everything, from account-based marketing to giving sales teams goals to meet.
Finding ways to make more money and grow the business.A revenue operations tool gives RevOps leaders information that helps them find good customers and markets, make new products, and grow their businesses into new areas.
Creating a need.Every marketer and sales rep has a part to play in making sure there is demand for their goods and services. RevOps software helps them keep track of, assess, and improve their efforts to get leads and customers.
Do the caring.With a revenue operations platform, people on the revenue team can see everything, from web content interaction to email drip campaigns. Their leads who aren’t ready to buy are kept in the loop with these insights.
Getting the buying process and customer journey to work better.RevOps makes it easy to understand how customers act at all stages of the customer journey, from getting new customers to keeping old ones. It also helps find problems that might be stopping a seller from reaching “Closed Won.”
Getting things done.With RevOps software, buyers can see where each deal stands and how they can make the most of it.
Satisfaction after the purchase. RevOps software has many tools that help customer success teams make sure that all of their customers are pleased with their product or service and are actively using it. It also helps with cross-selling and upselling, which are two important ways to increase the lifetime value of a business.
Pros of Software for Revenue Operations
Revenue operations software is the best RevOps tool there is, and it helps companies in a lot of important ways. Advanced analytics and automated processes have made it possible for companies to:
Marketing, sales, billing, and customer success data that is all in sync
According to LinkedIn’s 2022 Global State of Sales study, almost half of all sellers say that missing data is the hardest thing for them.
CRM, CPQ, and other parts of the sales tech stack are great places to get data, but they don’t give sales teams the full picture they need to close deals faster and make more money.
A lot happens with customers before and after the sale. Marketing is often the first thing that a new prospect sees, and a happy customer sets the tone for the rest of their experience.
All data connected to sales is collected in one place by RevOps software, which connects what happens before, during, and after the sale.
Accurately predicting sales
Companies that have seven or eight figures in MRR often don’t know what to do with their money or where it’s going.
Businesses need to know how much money they can expect to make in the next few days, weeks, and months in order to plan their campaigns, budget their resources, and understand market trends. When investors look at new businesses and companies they already own, they also want to see a reliable income forecast.
RevOps software gives companies an up-to-date view of their current flows, which lets them figure out how much money they could make from current deals. It also tells them about the overall health of their sources of income.
A look at the revenue funnel from every angle
Sales leaders and executives aren’t the only ones who can use data to make choices. Individual contributors depend on the information that revenue operations software gives them to do their jobs better all the way through the revenue funnel.
RevOps data is used by marketers to divide customers into groups, score leads, and make content more relevant to each customer.
Sales reps use it to sort leads into groups, speed up deals, and find chances to upsell.
The customer success team learns about how customers use and interact with the product, which helps them improve the hiring process and keep customers from leaving.
Better cooperation between departments
Alignment is possible when everyone has access to real-time income data and insights powered by AI.
The sales and marketing teams of a company are 67% more likely to close deals when they work together. And B2B companies lose about 10% of their total income because different departments don’t work together well.
RevOps software is used in different ways by different parts of revenue operations. However, the practical insights it gives and how easy they are to find make it easier for everyone on the team to know what’s going on across the board.
Nobody is confused or held up when everyone has access to the same information. Just different teams working together to get the job done.
Better visibility of the pipeline
While CRM helps sales leaders get a general idea of what’s happening in the sales process, it’s not quite enough to know what’s really going on.
- How long does it take for deals to close?
- What do the best salespeople do to make more deals?
- How many deals really have a chance of going through?
Reps often think that leads will close, which is the main problem with most of them. They’re not, though.
That’s no longer a problem thanks to the sales AI tools that come with a RevOps system. Leaders and sellers can see where each deal stands and figure out which ones are likely to close and which ones aren’t worth their time.
Safety of Data
Security is an advantage of revenue operations software that doesn’t get much attention because it doesn’t have anything to do with making money. But information is valuable, which is why people try to steal it.
At the moment, a data breach costs an average of $3.68 million, and it costs about $1 million more for companies with workers who work from home. Most businesses say they have more than one per year.
Software for managing revenue adds an extra layer of protection against data breaches by having security measures built in. It’s especially important for businesses that have a lot of customer information or private personal data to stay safe. For example, healthcare providers.
Better Service for Customers
With RevOps tools, internal processes are sped up and sellers are given more details about their buyers. This leads to a more tailored and satisfactory customer experience.
With data-driven insights, sales teams can better understand what customers want and give it to them in a way that makes them happier and more likely to buy.
Customer success teams can also use RevOps data to give better help by creating personalized onboarding packages, suggesting how to use the software, and following up on time.
What RevOps Software Does to Keep Track of KPIs
The RevOps software checks dozens of key performance indicators (KPIs) that show how the business is doing financially and how it can grow. It also shows marketing and sales actions across the whole company.
ARR and MRR
ARR and MRR, which stand for monthly and yearly recurring revenue, are the main metrics used to show how your business is doing financially and how it has grown over time. The only thing they show on their own is how much money a business makes each month (or year), but they’re what most other RevOps KPIs are based on.
The back end of revenue operations software also uses MRR and ARR for revenue attribution because it stores user data and marketing KPIs. RevOps software can measure the exact contributions each campaign made, which is helpful when the team wants to judge the success of a campaign (which is hard to do when the average deal cycle has almost 30 touchpoints between buyer desire and an actual sale). That way, people on the team can keep measuring them without the statistics getting jumbled.
Rate of Revenue Growth
Businesses take their regular revenue at the end of a period and subtract their recurring revenue at the beginning of the period to see how much money they made over a certain amount of time, like three months, a year, or ten years. When you divide the difference by the initial number, you get the growth rate as a percentage.
The income growth rate is used by the RevOps team to compare growth to stability and long-term viability. As much income growth as possible isn’t always possible, so comparing it to how the company works and what its goals are now helps to find the right angle.
The value of a customer over their lifetime
How much each customer is worth to the business over time is shown by customer lifetime value (CLV). It looks at all of a customer’s purchases and tells you which customers are worth more than others, which helps you set more realistic sales goals.
Most of the time, a high CLV is better because it means that the average customer is getting more from the business. If the cost of getting a new customer (CAC) stays about the same, increasing CLV means making more money from a single customer while spending the same amount of money on them.
Deal Size on Average
The revenue team wants to know how many deals they need to close in order to hit their revenue goals, not how much each deal is worth on average. The average deal size is another good way to tell how good the leads are that are coming in.
However, average deal size isn’t always important; a high number here isn’t as useful if it costs a lot to get new customers or if these customers don’t bring in much money over time. It’s important to keep an eye on more than just normal deal sizes for businesses that want to stay in business.
Cost to Get a New Customer (CAC)
Making money means being profitable. RevOps team members need to keep track of how much it costs to make the money they’re interested in in order to get a full picture of the company’s financial health.
With revenue operations software, they can keep track of how much it costs to get each customer (by source) and link that cost to each sale. With this information, it’s easy to see that capital input (money spent on advertising and sales efforts) and financial output (revenue) are linked.
Rate of Retention
Keeping customers is much more affordable than getting new ones, since the business doesn’t have to keep looking for new ones. A company with a steady customer base (and a good MRR) doesn’t have to spend all of its time and money on prospecting. Instead, it can focus on giving its customers more value and better service.
The retention rate, which is generally given as a percentage, shows how many customers kept their subscription over a certain time period. Companies don’t have to work as hard to get new customers when they have a high return rate.
It’s also better for businesses to keep customers because, when they do, they can start a support program. A great way to get more new customers is to offer referral bonuses to long-term customers. If they like the product, they should be happy to give you their referral link.
Size of the sales cycle
More than three-quarters of B2B buyers say their last sale was “difficult” or “very complex.” This is because B2B purchases usually involve more than 10 people making decisions and take more than two months to finish.
Since cutting down on the number of people who make decisions isn’t possible, the only way to make the process easier is to shorten the sales cycle. Customer service workers can focus their efforts better and close deals faster if they know where each buyer is in the decision-making process and how long they’ve been there.
Revenue operations software gathers information about the whole buying process, making it easy for the RevOps team to see which sales processes are taking too long and need to be sped up. When combined with a strong analytics engine, this data can help buyers figure out why deals are falling through and what the team might be able to do to fix it.
Payment extensions, upgrades, and keeping net revenue (NRR)
Net revenue retention (NRR) is something that RevOps teams look at to see how stable their present customer base is. It’s harder for businesses to invest in long-term and growth-oriented projects if they don’t have a steady stream of predictable income.
It’s not enough for customers who renew to make CLV and retention numbers better. You can also grow your business without spending any more money on getting new customers by offering improvements and renewals. They are also one of the few ways to make NRR grow over time.
What the RevOps Platform Can Do
Since the term “RevOps” isn’t very clear, each revenue operations tool works a little differently. All of them, though, have tools for intelligence, forecasting, and attribution.
Information about revenue
The revenue intelligence tool is what team members use to get into the details of their data. It lets them look at detailed information about each customer, find patterns in the sales process, and find problems that stop deals from going through. People from sales reps to board members can all understand revenue intelligence patterns and graphs that are made from numbers and individual data points.
Let’s say a company that makes a lot of money wants to grow their business into a market they already know a bit about. They can use revenue data to figure out if the market is big enough and profitable enough to be worth their time.
Predicting income
Revenue forecasting is like sales forecasting, but it looks at the whole life cycle of a customer. Not only does it help you guess what will happen in the future, but it also helps you understand what happened in the past and how all the different parts of a company’s present performance fit together.
But it’s not enough to just guess how much money will come in. For revenue forecasts to be useful, they need to be accurate. Software for revenue operations has a lot of data to learn from and market information to fill in the blanks. This lets it make predictions that are both complete and correct.
Attribution of Revenue
RevOps is based on revenue tracking, which means connecting the dots between cash flow and the things that bring in money. It allows team members to understand which channels are producing revenue and why, so they can allocate capital to the areas that will bring them the most bang for their buck.
It might seem easy to attribute a sale to a specific income source. It’s not like that at all.
Picture this: The marketing team is running a campaign to get people to sign up for the email. People like Customer X sign up for the email, read it a few times, and then don’t do anything else.
Weeks later, Customer X reads product instructions, saves a few blog posts, and shares them with their team. They also go to the price page, book a demo, and then back out at the last minute in the weeks that follow.
After a few weeks, a salesperson emails to follow up on the demo they were given with Customer X. The customer responds, books the demo, and the negotiation that follows leads to a sale.
What exact sales and marketing efforts led to the closing of this deal? And how much did each route cost compared to how much it contributed? The software RevOps knows.
Integrations of Revenue Operations Software
The only way to get a truly unified view of customer data is to connect sales operations software to the rest of the tech stack. The whole sales process can be made easier by combining revenue operations software with current CRM, sales tools, and billing software.
CRM stands for customer relationship management.
CRM software is the most important piece of technology for any business because it stores all the information about customers that helps people make decisions. When a CRM is combined with sales operations software, teams can see how healthy their customers are and predict which ones will leave.
Managing the Pipeline
Pipeline management is often a part of CRM, but it’s also common in marketing automation systems and sales tools.
By connecting these to RevOps software, teams can compare their sales progress and performance to KPIs, see where they are in the sales cycle, see how long it takes to close deals, and find out what makes buyers decide not to make a purchase.
Analytics and BI
Analytics and business intelligence (BI) systems can be linked to revenue operations software. This helps sales reps see where leads are in the pipeline and how long they’ve been there. This data is already in RevOps systems, but other BI tools make it better quality and easier to read for large amounts of complex data.
Engaging with Sales
Platforms for sales engagement, such as DealRoom, make it easier for customers to talk to you, which helps members of the RevOps team work together on deals, share material, and learn about what customers want.
Set up, price, and quote (CPQ)
CPQ software speeds up the sales process by letting customers configure products while talking to a salesperson or through self-service online. It also makes quotes, price estimates, and proposals instantly and turns them into legally binding contracts and invoices.
When teams connect CPQ to software for revenue operations, it’s easier to predict income, keep an eye on how products are doing, and raise key RevOps KPIs.
Billing and keeping track of money
When you combine bills, you give the RevOps software more information to work with. It’s better to get information about customer payments straight from the source. Finance and accounting are also important to the success of revenue operations because they measure the financial health of the company and make sure that tracking is done correctly.
