Improving Sales Territory Management and Planning

leadspace sales territory plan

Aligning your teams to ensure sales quotas are met has never been easy, and the current environment has only made it harder. If your sales goals are not being met, it may be time to optimize your sales territory management strategy by utilizing all available resources effectively to boost sales productivity.

What Is Sales Territory Management?

Sales territory management is the process of creating and identifying your sales territories, assigning those territories to your reps, and then continually optimizing those territories to keep your sales reps productive. When sales territories are well managed, your sales reps are busy and effective with a clear view into their most important sales targets. A sales territory is not a one and done exercise. It’s an ongoing process that needs nurturing. Ideally, you have a sales territory plan to ensure your sales and demand-generation teams are targeting the most valuable prospects, and to identify (and pursue) the steps necessary for your company to achieve growth, efficiency and revenue.

What Is Sales Territory Planning?

Sales territory planning is the process of organizing accounts’ and prospects’ engagement responsibilities, and then dividing them into sales and demand generation resources, in a way that helps maximize sales productivity (pipeline creation), and drive sales growth (winning accounts) over time.

There are many factors to consider when building sales territories. These could include your team’s historical data (previous revenue and bookings), firmographic attributes (company size, location, and industry), or the account executive or seller characteristics (tenure, recent performance, and product line or industry experience). 

Importance of Sales Territory Planning

Sales territory planning is one of the most important components of an organization’s go-to-market strategy. Frequently, sales leaders overlook territory planning as a catalyst for growth. Planning takes time, but right before the start of a new fiscal year or quarter, there’s often not enough time. It is also frequent to find organizations applying cookie-cutter or equal spread logic to the process of carving out territories in hopes of being fair or democratic to all the sales reps. However, these practices result in poor alignment with strategic goals, poor motivation among the different sales teams, and poor market performance in general.

Key Steps to Optimizing Territory Plans

There are five key steps to creating and optimizing your territories, while making them directly actionable:

1. Understand your Ideal Customer Profile (ICP) – at both the account and person-level.

2. Create your Total Addressable Market (TAM) by territory.

3. Map the terrain of each territory – understand your existing customers and whitespace.

4. Identify the right and ready accounts.

5. Identify the right and ready contacts within those accounts.

The novel concept here is the opportunity to accelerate revenue generation through the optimization of sales territories, and go-to-market operations with data-driven AI-targeting and lead prioritization. This would start with a prioritized view of worldwide opportunities in the context of the way you organize your business, your go-to-market, and your sales territories today. These would then be further optimized by adjusting criteria, individual accounts or regions as needed to effectively delegate your available resources to them accordingly.

Best Practices for Optimizing Sales Territory Plans

Let’s break down the best practices for each of the five steps for sales territory planning mentioned above:

1. Understand your Ideal Customer Profile (ICP) at the account and person-level.

A good practice would be to configure your Ideal Customer Profile (ICP) via firmographic data for accounts and demographic data for contacts. A best practice would be to create it with AI-models for sales territory accounts and contacts.

Pro tip: Base your ICP on the kind of accounts and contacts that they, or their competitors, have closed.

2. Create your Total Addressable Market (TAM) by territory.

A good practice would be to gather account universes from third-party data tools. A best practice would be to use a Customer Data Platform (CDP) that leverages your internal first-party data with third-party data to fully understand your TAM and fuel your AI scoring model. 

Pro tip: Conduct this analysis for every sales territory so that you understand if a state or zip code has the right resources and manage changes accordingly.

3. Map the terrain of each territory – understand your existing customers and whitespace.

A good practice would be to understand and collect the details on all the companies you do business with in each territory – this includes firmographics and technographics that will help understand the differences and segments within each territory. A best practice would be to map your overall whitespace and “lookalike companies” against that territory, adjacent industries, vertical integrations present, etc. – any opportunistic characteristic could be mapped! 

Pro tip: Use those to understand renewals, upsell and new logo strategies, and to determine resource allocation amongst teams.

4. Identify the right and ready accounts.

A good practice would be to leverage acquired intent signals from multiple vendors against your ICP for each of the accounts you target or monitor (in Salesforce for example). A best practice would be to integrate AI propensity models and intent signals directly into the CRM to prioritize accounts by fit and readiness (in order of likelihood to buy).

Pro tip: Conduct this analysis for every territory with weekly updates – intent signals and topics change every week so frequency is important.

5. Identify the right and ready contacts within those accounts.

A good practice would be to organize the accounts within each territory by their Marketo, Pardot, Eloqua, or Hubspot scores. A best practice would be to integrate persona scoring in conjunction with engagement scoring at the account level to identify the best (most ready-to-buy) contacts/prospects to pursue. 

Pro tip: Use this strategy to focus their efforts and lower regional sales and marketing list-buys and event costs.

CDPs Can Make Managing Sales Territories A More Seamless Experience

Independent of the strategy used to build your territory hierarchies, it’s important to plan territories in a transparent and equitable way for all sales reps. Historically, achieving that equity has been a game of chance when assigning territories by hand. Now sales leaders can apply predictive AI-models across their TAM, enabling them to make territory assignments knowing their decisions are backed by data. By implementing a Customer Data Platform, you can achieve data-driven territory management with automatic updates throughout the year. Your territories being equally assigned is important, but what if all of your sales reps could also view the accounts within their territory in order of their likelihood to buy? With equitable territories, all of your sellers hit their quotas – but with the right territories, they’ll exceed those quotas. For more information, watch our webinar, Best Practices for Improving Sales Territory Management, or check out the blog series, Moneyball for Sales Territory Management.

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