Our business development guide will help you have a better understanding and provide you with the tools to succeed in this field!
Business Development is a very fascinating field. After all, it's all about finding the best way to grow an organization. There couldn't be anything more creative in business. Looking for the latest trends, trying them out, and figuring out the winning strategy is very rewarding.
But, there is an issue with it:
Nobody really knows what business development is!
Data from a survey we started in 2018 show that as much as 71% of the business developers who participated, are not aware of what their job entails. That's very concerning, especially considering that a whopping 53% struggle to reach their target.
These numbers call for some action, therefore we created a complete guide to business development to help professionals navigate through their careers successfully.
In this business development guide you will learn:
- What is business development
- What business development is not
- Most common business development strategies
- How to create a business development plan
- How to build your business development team
- What does a business development manager do
- How to measure business development
1. What is business development
If you’ve done some research, you already figured out that there isn’t a universal definition of business development.
For most of the people out there it’s just sales. For some others, it’s just marketing.
Removing all the fuzz, this is the most accurate definition we can give to business development:
To give it more context, you need to take 2 elements into account when starting with business development:
At which stage is your company currently
Business development is something universal that every company should do. However, the company stage deeply influences the way you should execute it.
If your company is an early-stage startup, business development should entail a lot of business planning and strategy.
You first, need to find the right business model, the right users, the right channels, and so on.
On the other hand, if you work for a big corporate, you already have a solid customer base.
So your concern will be, how to get more of those. In this case, your business development strategy will mainly focus on product development or new market entry.
However the company is structured, keep in mind the ultimate goal: developing and implementing growth opportunities.
If you want to better understand the role of business development, join our business development course.
What's the overall strategy of your company
Another key element that influences the execution of business development is the general strategy of your company.
Some companies are highly dependent on sales, while others on products or partnerships.
Based on what the company focuses on, the activities will be slightly different.
In the case of sales-focused companies, business development will entail a lot of lead generation, customer meetings, demos, etc.
Whereas if the company is focused on relationship building, business development will entail a lot of meetings and strategic decision-making.
2. What business development is not
So now that we defined what makes business development, we can tackle the issue of what it's not.
Considering the difficulty to define business development, over the years someone decided to associate it with other fields.
The result is that nowadays people confuse or combine business development with three other things: sales, marketing, and product development.
What's the difference between business development and sales?
Ok, I say it: we are not "just" salespeople! This is one of the most frustrating things you can say to a business developer.
Don't get me wrong, obviously, sales is a relevant part of business development.
But the thing is that some salespeople misused the term business development just to sound less sales-y.
Result? Now everyone hates both salespeople and business developers!
Regardless of our hate-love relationship, this is why sales and business development are different:
- Business development
supports sales in achieving its goals. We do this by identifying business opportunities, generating leads, assessing their needs, and delivering qualified opportunities
its duty is to accompany prospects through the customer journey and to generate revenue.
Basically, the crucial point is that we play in different stages of the customer journey.
Business development acts on top of the funnel. Our job is to trigger pains and educate leads.
While sales get in touch with prospects that are already considering the solution and help them purchase.
Last, sales is often involved in the after-sale process.
In a nutshell, we could define business developers as the front line of the sales army!
What's the difference between business development and marketing?
Marketing is another field that is often confused with business development.
This is mainly due to the big overlaps in some key areas, notably lead generation and brand awareness.
While sales-business development is almost a fight, in this case, the issues are more related to efficiency.
What I mean is that sometimes marketing neglects the role of business development in some key activities.
The result is that we both work on the same things wasting time, and even worst, creating an inconsistent brand image.
The key to solving such an issue is to make sure that business development is actually included in the marketing team, serving as a link between this and sales.
This process would create a perfect machine that is able to accompany a customer or partner from start to end of a possible collaboration.
Business developers have first-hand experience with customers and partners which represents a very valuable asset in order to improve targeting and messaging from a marketing perspective.
Ultimately, the relationship between marketing and business development is of mutual support meant to amplify the potential for success of both sides.
What's the difference between business development and product development?
We mentioned already that one of the business development strategies is product development.
Once again, the overlapping between business development and product development causes some confusion.
In this case, the key differentiator is in the type of activities conducted.
Business development takes part in the research phase of product development and sometimes contributes to the sales part.
Product development, on the other hand, needs to build the product itself, but also orchestrate with other stakeholders such as design, manufacturing, and marketing.
The role of business development is dual: it can both validate an idea in the market and then bring back the results to product development, or generate new ideas that can then be discussed with product development to start the production process.
3. Business development strategies
Now that we’re aligned on what business development is, and it’s not, it’s time to dive deeper into the actual ways companies can act on business development.
Being such a broad field, it means you’re also quite flexible.
So it doesn’t matter what type of company you work for, most likely you can come up with some sort of business development.
However, to give it some structure, we can group these activities into 4 main strategies that are typically used in business development.
Bear in mind that there isn’t one strategy that works better than another and often times they go together.
So the preference for one or the other is completely dependent on your overall company strategy.
Sales development is one of the most used strategies in business development
Obviously, any company wants to acquire new customers. It’s not a surprise that the most used strategy in business development is strictly related to sales.
If your company goes for this strategy, you will probably focus on activities that already proved effective to gain clients.
In this case, you can act in two different ways:
- Inbound: In this first case, you already have a solid base of leads provided by other departments (marketing). So your main responsibility is to get in touch with them, assess their needs, and handover the potential ones to the sales team
- Outbound: in this case, the role is more proactive and you will be also in charge of lead generation.
An important note is that, depending on the resources available in your organization, you might be in charge of the full sales cycle, which means, also closing deals.
The biggest advantage of sales development is that - of course depending on the product or service the company is offering - it's able to deliver results almost immediately.
Strategic Partnerships are a good way to grow faster and minimize the risks
The second very effective way to develop a business is through strategic partnerships.
This strategy is also one where your creativity and natural talent in spotting business opportunities play a big role.
It basically means allying with another organization with the goal of mutually enhancing your businesses.
A strategic partnership can have different forms and they mainly depend on the objectives and the level of formality you put in it.
In terms of duration, a strategic partnership can be a “one-shot” and rotate around one single thing, or it can be a long-lasting relationship.
Regardless of the type and duration, the core is always the sharing of resources to achieve a common goal. Resources can be of different types as they can entail a simple social media post sharing or a big distribution deal.
Strategically allying with other parties has a huge amount of benefits.
First and foremost, it allows companies to test out new strategies by using the other parties' capabilities, thus minimizing the risks.
Secondly, once the partnership is in place, it can deliver results fairly quickly.
Thirdly, it contributes to increasing the company's authority and reputation.
Now, while a strategic partnership makes things a lot easier - once it’s done - the process to get there might be a little bit trickier.
Differently from customers, that might have or not have a need for your product or service, a strategic partnership is based on different value propositions that change consistently case by case.
Ultimately, what makes reaching an agreement a more complicated process is trust. Of course, your customers also need to trust you in order to buy. But when it comes to an organization that has very similar interests to yours, trust assumes a key role.
This is especially true in cases of competition, where you’re basically trying to partner up with your competitors.
Getting to an agreement might take a long and requires a lot of energy and transparency from both sides in order to make it a successful collaboration.
Market entry gives you instant access to a whole bunch of new customers
Market entry is one of the top strategies used in business development. This is a powerful way to expand your business if you saturated your current market.
A new market means new customers thus new revenue that didn’t previously exist. You can enter new markets using different ways and these are the three main approaches:
- Waterfall method
The expansion into foreign markets is sequential. You basically enter one market at a time and use the knowledge gathered in the previous country to improve the next one
- Sprinkler strategy
The expansion happens simultaneously in different countries as it's based on the principle of diversification. So instead of putting all eggs in one basket, you attempt to enter as many markets as you can at the same time with a very standardized process
- Wave strategy
Like in the sprinkler strategy, you also attack many markets at the same time. However, contrary to the previous one, you select a specific amount of countries. You first need to analyze their culture and business environments and choose the ones that are more similar to your original market.
If you go for market entry, you need to take into account many different things which might represent a challenge.
First and foremost, you need to deeply analyze the market.
It’s important to understand what’s the business culture, who your target will be, who your competitors are, and whether there is a need for your product or service.
After that, you need to choose how you’re actually gonna enter.
Maybe you won’t need to directly go there, as you might just buy a local competitor and continue operations under that brand. Or you might consider a franchise or use a distribution channel.
When you decided on your favorite method, you need to start considering some practical implications such as localization. You will need to localize everything from your website to your marketing ads, to the labels on your product, and to the currency used to purchase your product or service.
Last, you need to take into account the legal aspect of a market expansion.
The local laws might be very different and might forbid your product or service.
To sum up, market expansion is an amazing tool, but if do your homework. Otherwise, you might end up with huge losses.
Product development is a very effective way to create new customers and upsells to current ones
The last strategy to grow a company at any stage is product development. Product development can be both the improvement of existing products or the introduction of new products into a market.
The core of product development is basically transforming a market opportunity into a product that people can buy.
This strategy is helpful as not only it generates new customers, but also increases the revenue of current ones through up-selling.
Like for most of the other strategies, it also has its challenges and similarly to new market entry can end up in a loss for the company.
When considering launching a new product the most important thing you should do is once again research.
Your role, in this case, is to gather all the needed information from the market and convey them into actionable feedback.
Then you have to communicate your findings to the product team which will then be able to build the actual product.
You will need to get directly in touch with current or potential buyers and identify the need for the specific new product (or improvement) you have in mind.
Over the years there have been many different theories and models on how to better approach product development.
From the Booz, Allen, and Hamilton (BAH) method created in 1982 to the more recent Lean Startup movement, the ways to tackle product development vary a lot.
However, in all cases these 3 steps are the bare minimum to avoid wasting time and money:
- Observe the market
In this phase, you need to understand the market, the client, the technology, and the limitations of the problem
- Create your prototype
This is the moment in which you can create your first version, evaluate it, and eventually improve the concept. You can then go ahead creating the final version
- Commercialization and marketing
As the last step, you will, of course, need to start marketing your product and start selling.
Business development covers a key role in the first and last stages, helping to define the market needs and consequently to market and sell it in the best possible way.
Developing a new product needs to be approached in the most collaborative way possible. It involves every aspect of the business.
Therefore it’s absolutely necessary that all the stakeholders are aligned and work together to create a product that makes sense to the audience and can actually be sold.
Join our business development course to learn all about the business development strategies.
4. Business development plan
After figuring out how to shape your business development strategy you’re ready to create your business development plan.
This is basically a document that will summarize all the information you will need on a daily basis.
If you’re just getting started, creating such a plan can be quite overwhelming due to the high amount of information you have.
The type of information can slightly vary from one strategy to another. However, this basic information is common in all of them.
Insider tip: The most effective way to create this a plan is by using a spreadsheet and create a tab for each one of these topics:
Start with detailed market research
You need to start gathering intelligence on the highest level, therefore, you need to start with market research, which is the foundation of any strategy you decide to undertake.
The first thing you need to assess is the size of the market you’re trying to attack.
You need to analyze the Total Addressable Market (TAM) and find out what’s the potential lies within your market.
After finding out how big your market is, you want to know how much of this market is already being served (TSM - Total Served Market) by your competitors.
Things you need to check are how many competitors you have - of course - how many customers they claim, how many people know them, etc.
After having this clear picture, you will now be able to know what share of the market is left for you (SOM - Service and Obtainable Market) and it will be the portion that you will be targeting.
Insider tip: even though the idea of conquering everything is really appealing, don’t rush things and stay organized. Focus is the best ally in business development!
Include an industry analysis in your plan
Going deeper into your plan, the next thing you need to start digging into is your industry especially if you just started working in a new company or project.
Many times this step is overlooked, however being aware of what’s going on in your industry can really help you be ahead of the competition.
But most importantly it will help you relate more to your target audience which will see you as an expert in the field.
When analyzing your industry there are three main things you need to include in your plan.
First, an overview of reliable sources that your audience also follows and that you should regularly check.
Second, you need to document any relevant topic that your community is talking about.
Last, you need to identify popular keywords and jargon that you can then integrate into your daily vocabulary, especially when communicating with your audience.
Get to know your competitors
Having a competitor's intelligence can really help you beat your competition and win their portion of the market.
When checking your competitors you definitely need to have a general overview in terms of products and services they offer
But don’t make the mistake of stopping there. Knowing how much they charge for what they offer is not really what is gonna make the difference.
Your intelligence should also include the opinions of their customers, their value propositions and unique selling points, their way of communicating, the channels they use for distribution, their key personalities and a lot more.
The more information you can gather, the better you can structure your business development strategy and get access to an increasing number of opportunities
Make sure to know all about the ideal customers you want to target
Now that you’re aware of what’s going on around you, you need to craft ideal customer profiles.
Now, when it comes to this type of research, many companies prefer to just execute and follow their gut feeling. Don’t do it, really.
Precisely knowing who you want to target will save you a tremendous amount of time and will give you better results faster.
If you already have a user base, start from it and look for patterns that can help you have a detailed picture of your customer profiles.
A very effective way to identify your best customers is to ask your colleagues in other departments to mention some names.
After doing that, check your data what are the companies that pay the most, the ones that were easier to acquire, and the ones that stick with you for a long time.
Once you’ve built this list, check which names that come up were mentioned most times.
If they have been mentioned by your colleagues, and you found them also in your data, chances are that these companies are the ones you want to target.
On the other hand, if you don’t have a user base yet, start researching and collecting information about the companies or partners you think have a need for your product or service.
The information you need to collect includes the type of company, a few examples to better explain what companies you’re referring to, company size, and geography.
Gather all the information you can about your audience
Knowing what companies or partners to target is just the first step, you then have to start analyzing who within these organizations is gonna be the right person to approach.
Once again, start analysing your user base if you have one, otherwise, start researching.
A survey will do the job, but it won’t be enough. You will also need to check social profiles and other places where your target persona hangs out.
When researching your persona you need to ask yourself questions that help you have a deep understanding of the way people like to be approached, how they speak, what they’re interested in, what are their challenges, and how you can ultimately help them solve them.
A typical mistake many companies make is to only map out the decision maker.
This comes from the belief that anyways, you need to have the top people onboard and that should be enough.
However, if you really want to be effective you need to have data about every single person involved in the decision-making process.
Your persona map should include influencers - which are the end users of your product or service - and buyers which are the people that make the actual purchase.
Insider tip: Don't let your assumptions guide this research. You will be amazed to find out how many things you assumed wrong about your audience!
Create value propositions that resonate with your audience
Finally, the information you collected is starting to take shape and you’re now ready to craft some compelling value propositions.
In any form of communication with your audience, you will need to provide some value and this, of course, needs to make sense.
The best way to create a good value proposition is by analyzing all the research you made and seeing what your target audience cares about.
Creating value propositions is quite challenging as it involves effective copywriting and a deep understanding of your customer needs.
But the real issue is being able to actually interpret what your audience actually meant when it answered your questions.
Insider tip: The process can be very easily biased by what you assume to be the right way to look at this data. Therefore you should really try to leave out your opinion and be as objective as possible
Create a content plan to reinforce your value propositions
Whatever way you decide to approach your audience, be it by email, phone, social media, events, etc. I strongly advise you to create a content plan.
A content plan is basically a list of articles or any other media (videos, podcast, etc.) that you can use to relate to your audience.
As usual, it needs to be something relevant to your audience and you can find this information from the previous research, especially the persona research.
This plan can help you be structured in the way you promote yourself and company, but most importantly it shows you are an authority in your field and you know what you’re talking about.
Insider tip: if you don’t focus yet on content and inbound marketing, consider starting a company blog. You will be fully in control you will be able to steer your audience in any direction you want!
Prepare a distribution plan to reach out to your audience in the right places
The last step of your business development is a distribution plan in which you will decide where and how to approach your audience.
Once again, the user research should have highlighted places where your target usually gets information about the problem you’re trying to solve.
In this tab, you should include all the necessary details on how you want to reach your persona in the specific channel.
Insider tip: Whatever you decide to do, make sure you’re always present in front of your audience!
5. Build your business development team
Having a plan in place is a bit useless if you don’t have anyone to execute it.
The next step in your business development journey is to find the right people to enroll in your team. These guidelines will help you better identify your needs when it comes to talent.
Starting from the basics, the first thing you need to do is to create a job description. This step seems easier than it is.
The issue is that when it comes to business development it’s very common to be too general and not really specific on what you want from your candidates.
If you make this mistake you'll end up with miscommunications and misalignments. So take the time to really define what type of responsibilities you would like your team to have.
Make sure you also put training in place so you can easily get your team up to speed. If you need some help designing the perfect business development training get in touch with our team.
After having clearly outlined your requirements you can start screening candidates.
Considering the hype around business development you might end up with a high number of applicants with very similar profiles and experiences.
In such a case it becomes crucial to have a baseline to refer to when it comes to the skills you’re looking for.
These are the top three skills of business development managers that you should definitely hunt for:
A good business developer is a good communicator
Before anything else, a good business development professional must have communication skills.
This role is mostly in touch with your audience, therefore it’s necessary to be able to effectively communicate with the external world.
But that’s not the only relevant aspect, most of the job in business development is actually made internally.
Working in this department involves a lot of cross-team collaboration as well as a lot of persuasions in order to get everyone on board.
When interviewing for such a position, try to look out for skills like listening, empathy, confidence, ability to ask good questions, etc.
Ultimately, after the interview, you should feel your conversation was valuable and enjoyable to you.
That’s a good way to assess the likability of a person.
Business development professionals know how to sell
Regardless of your approach to business development, it always implies some level of selling.
When assessing a candidate check if s/he already had experience in a sales environment.
Try to ask questions that will highlight typical sales skills such as rejection handling, cold calling, relationship building, etc.
Be aware that sales skills don’t only come from direct experience in a similar environment to the one of your organization.
Keep an open mind and look for hidden gems in your candidate pool.
A good business development professional has a genuine interest in marketing
Business development is rapidly evolving and organizations are now using a more multidisciplinary approach to it.
If you want to be ahead of the competition, marketing skills should definitely be on your checklist when recruiting your new team members.
As for the previous skill set, you don’t necessarily need to hire someone with ten years of marketing experience.
But someone with a basic understanding of how marketing is definitely preferred.
How about personality traits?
Hard skills are definitely an asset when hiring business developers, but what truly makes the difference in this field are soft skills.
The list is quite long as there are multiple factors that come into play, however, these four personality traits represent the must-haves for anyone working on must-haves development.
When screening candidates to enroll in your organization, you must look out for the ones you’d like to CLAP to.
A good business developer is all these things at the same time:
One of the key personality traits of good business developers is creativity.
One of the main responsibilities of business development professionals is to find business opportunities. And that can be difficult if you are not creative.
Creativity enables business developers to spot opportunities much easier because they are more open to imagining innovative solutions to their daily challenges.
Regardless of your chosen strategy, make sure to have people on board that have a natural commercial appetite.
A good business development manager is also very aware of the importance of continuous learning.
When looking for staff for your business development team you need to look for talent that is extremely curious and are constantly looking for ways to improve themselves.
A personal craving to know more will bring huge benefits to your organization.
It will both get you access to the latest news in your field and will also motivate the rest of the team to adopt the same best practices.
This is another very important soft skill for anyone who decides to have a career in business development.
Due to the high number of different activities involved in this role, a good business development manager is able to adapt very quickly to different environments and stakeholders.
This also means that your candidates should have a high level of social intelligence and empathy to help them get along with different people.
Last in this list - definitely not for importance - there is persistence.
The ideal candidate for a business development role doesn't stop at the first rejection. Instead, they keep trying until they reach their goals.
Make sure you ask questions meant to understand such quality in your interviewees.
6. What does a business development manager do
The day-to-day activities of business development professionals vary a lot depending on the seniority and the strategy of the company.
However certain tasks are common to most positions in business development:
It's all about doing your homework
Researching is the foundation for all of us working in business development.
If we want to be successful we need to research our market, industry, and competitors.
The more information you have, the more targeted you can be and achieve your goals.
Make sure to reserve a couple of hours a week on your agenda to learn!
Get hands-on with some lead generation
Lead generation is also something we spend a lot of time on. And it’s also one of the most challenging aspects of business development.
You need to find enough leads to approach, but most important: you need good-quality leads!
This causes so much frustration because, at the end of the day, you are always fighting between quantity over quality.
Because at the end of the day - especially in sales - we know that the more we get, the better it is!
But before rushing to follow the wrong leads, take a minute to review these effective ways to find leads:
It’s by far one of the best lead-generation tools. You can network offline by attending specific events or online on tailored social media or communities.
The reason why it’s so effective is that it allows you to directly talk to people, introduce your offering and get immediate feedback on their intention.
The downside is that it’s quite time-consuming and can get quite expensive.
Getting your current clients, friends, or partners to refer you leads is an extremely powerful tool.
Personal connections are always more valuable, therefore these leads have way higher chances to close.
The only challenge you will have, is to be able to meet the expectations of the people involved in the process.
Even tho, mostly illegal, one option you have is to use web scraping tools.
This software allows you to get instant access to details such as email address or phone numbers of people you’re trying to target.
Some other software goes one step further providing you with complete lists of accounts that are based on specific criteria.
LinkedIn sales navigator is one of those and, it’s perfectly legal!
Another option you have is to buy leads lists. Personally, I dislike this practice for two reasons.
First, I can’t know the origin of these leads which can put me in an awkward legal situation. Second, most of the times these leads are not accurate, so you just end up wasting money.
This is a more passive way to obtain leads and requires good coordination between you and marketing.
However, if you manage to be very aligned with your marketing team you can get hyper-targeted leads.
The best part is that these leads are already aware to have an issue making your job a lot easier.
Go crazy and start prospecting
As soon as you have your leads ready, you can start prospecting them.
Prospecting basically means getting in touch with your leads and trying to spark an interest in your offering.
There are different ways to tackle prospecting, but the most common are:
This is one of the scariest and most challenging aspects of business development.
It involves dealing with rejections and frustration as it’s quite hard to convince someone of your value just by phone.
However, it’s still a very effective technique as it provides immediate feedback and allows you to move on faster.
This is one of the most used techniques. If done right, it can bring good results.
But keep in mind that just like you, other thousand people are sending exactly the same emails to the same people.
If it’s not relevant enough it will just be ignored and you will end up with nothing.
Nowadays everyone uses social media to do business. But too often I noticed business development professionals don’t take advantage of this opportunity.
Only by putting a nice banner on your Linkedin profile and sharing industry news once in a while you increase your chances to get better results with your leads.
Make sure to reserve 1 hour a day to connect with your leads and be active on social media.
This won’t give you immediate results, but it will put you in front of your leads and they will start familiarizing with what you have to offer.
You're never gonna be alone again
A consistent amount of time in business development is allocated to internal meetings.
Considering that it’s so interconnected with all the other departments, you need to allocate some time to meet with them and align on what needs to be done.
Many companies, especially startups, prefer to reduce the number of meetings with the idea it’s more efficient.
It is true that meetings take up time, but only if they’re not held in a smart way.
As a business developer you have limited time to perform all your activities, so make sure you keep your meetings meaningful and time effective.
7. How to measure business development
The last step in making sure you’re building a powerful business development machine, it to start looking at relevant data.
Taking into account the different strategies and methodologies there are different ways to track the results of business development.
Depending on the strategy you chose above, these are the key results you should start measuring:
Sales development metrics
In this case, the metrics you should look at are the number of activities performed (calls, emails, networking events, etc.), the number of qualified opportunities generated, and the revenue potential.
If you are just starting with business development, keep your data simple and don’t overcomplicate by looking at too many things.
The metrics above are more than sufficient to run a health check on your processes and be sure you’re on the right track
Strategic partnerships metrics
Similarly to sales metrics, you should look at the number of activities performed. However, in terms of outcomes, you should keep slightly different metrics.
For example, you could track of how many partnerships were initiated and measure if the original goal was met.
Product development metrics
In this case, a good way to measure results is to keep track of the status of the market research (in progress/done) and if the needs for the product you would like to launch are actually met or not.
Starting with business development can be challenging as it involves a lot of energy strategizing and implementing processes.
Many business developers feel frustrated at times and one of the main reasons for this is not having a clear process in mind. Some of them are not even sure of what business development even means.
This is more common than what you might think and if you ever felt this way, now you know you were not crazy! Even the best of us didn't know what they were doing at some point.
But if you're reading this guide, you are already 100 steps ahead of most professionals. It shows you are ready to get your hands dirty and become a more successful business developer.
Keep reading our articles to find more insights and consistently improve your day-to-day job.
However, if you're impatient to boost your career, our intensive course might just be all that you've looking for until now.