A well-defined sales territory plan is essential when operating across different regions, industries, and company sizes. It helps businesses organise and optimise their sales strategies and resource allocation.
This is especially important when expanding into new European regions.
Each region has different cultures, economic conditions, regulations, business practices, and languages (24 to be exact), and each must be approached in a focused and efficient way, with tailored strategies to local nuances.
That means building a well-designed sales territory plan is key. A territory plan can help you understand these differences and ensure your company’s products, services, and messaging are positioned correctly to capture market share.
A sales territory plan is the strategic process of dividing, organising, and segmenting a business’s ideal customer base and prospects into distinct territories to help maximise sales productivity and revenue. These territories group accounts based on common attributes, including geography, industry, and company size.
A sales territory plan helps businesses target the right customers and effectively allocate their resources across different regions.
It also helps teams develop targeted sales and marketing campaigns and strategies tailored to each demographic and customer segment.
This is especially important when expanding into Europe, and Cognism has adjusted and iterated its territory plan to optimise its sales and marketing strategies. Let’s look at this in more detail (from our real-life experience).
Previously, Cognism’s territory management lacked organisation and clarity, and reps were often assigned to accounts at random. This meant there would be various finance, marketing, and recruitment companies within each segment, all of different sizes.
This would result in uneven performance and fluctuation across mid-market and enterprise segments and a lack of precision in Cognism’s outbound sales strategy.
As Jonathon Ilett, VP of Global Sales at Cognism, explained:
“We had a real lack of focus on what a good fit account looked like because we were randomising the accounts that reps were being assigned to.”
“This meant that our reps didn’t know the correct go-to-market strategy for the right accounts, and our sales efforts were not focused on bringing in the right type of customers.”
“We hadn’t allocated our resources optimally across our market segments, and our geographic coverage strategy was unclear.”
“We expanded into new European regions, but when we referred to a region, sales managers weren’t sure if that meant where the actual account was based, where the Account Executive was placed, or where the purchase process took place.”
This also resulted in a lack of focus on Cognism’s ideal customer profile, as sales and marketing were not focusing on areas with the highest win rates and best retention metrics.
It made the SDRs and AEs’ jobs more complex and less repeatable, as they had to continuously switch who they were selling to, which reduced efficiency, productivity and constantly altered the context of their pitches.
These common mistakes also meant Cognism’s sales teams couldn’t examine their geographical performance. Because Cognism was emerging in new regions, UK reps often sold to both DACH and the US, while US reps sometimes sold to France.
Cognism, therefore, could not understand what teams were doing well and where they saw success, as every team was selling everywhere.
As Rob Tomchick, Chief Revenue Officer at Cognism, also shared:
“The first time we rolled out tactical territories, we had random account lists that were not organised. It was difficult for our sales team to put a strategy together that they knew would be successful.”
“A rep covering the Nordic region should not be using a success story and case study from an account based in the UK.”
“If these sales territories had been set up correctly and a rep was primarily selling to software companies in the UK, they could have created a repeatable strategy, messaging and set of success stories that they knew would resonate.”
Cognism knew its strategy had to be more focused, especially when expanding into European countries.
Jon explained some of the changes that were made:
“With our new model, we’ve broken our sales territory strategy down to understand the right strategy for the segments and countries we are going after.”
“We reviewed our sales history, pipeline, closed-won revenue and other factors over the past quarters and created balanced territories for each Account Executive.”
“We’ve redesigned that structure to make it much more regional; everything is now HQ-led. We believe that adding a dedicated focus to each country will allow us to increase revenue while creating industry specialisation.”
“When it comes to particular geographic territories, we can see where we’re seeing high win rates and high ACV, and then we can put our resources, budget allocation and reps into those territories.”
When identifying which regions to allocate resources, Cognism analysed its international conversions and inbound requests.
Rob said:
“We first saw what was happening organically with our business. We began to analyse what was happening through our website and where those leads came from.”
“Some of those leads were high-intent leads and ready to purchase our data. We could see many people in Germany looking to evaluate Cognism, for example.”
“We saw a trend in revenue and knew that if we proactively invested in these regions, we could increase our growth rates, which led us to put a couple of AEs in this region. The key was to increase resources alongside demand and revenue growth.”
When creating your sales territory plan, you must decide how to split out where you sell.
Depending on market size and potential, you might split territories based on regions, company size and industry.
Here’s what Rob said about Cognism’s expansion into Europe:
“You have to think about which dimensions to start with. People typically look at these three constructs: geographic regions, industry and company size, including small-medium businesses, mid-market and enterprise.”
Geographical territories are the most standardised approach to sales divisions.
This approach remains relevant for several reasons, as factors such as time zones, languages, and cultural nuances still matter.
Geographical territories are ideal for in-person or remote sellers and align selling styles with regional cultures.
You might divide your territories by industry sectors if your product/service applies to specific verticals. This means salespeople become familiar with specialised buyer profiles, and industry-specific jargon becomes second nature.
You can also tailor selling processes to industry needs; that way, salespeople can develop an in-depth knowledge of unique product applications.
Rob broke down Cognism’s sales territory strategy:
“We started with geographies. For Europe, we have a dedicated GTM team in France and DACH and a mostly London-based team covering the rest of Europe.”
“Once established, you can determine revenue trends within each regional segment by looking at win rate, ACV, and retention figures.”
“Then, you can figure out how much you want to invest in growing each segment and if there are some segments you want to deprioritise.”
“We figured out that mid-market was growing the most in EMEA, so we then selected the number of AEs we wanted to invest in DACH, France and the UK and how many of those AEs should belong in MM, SMB or ENT.”
Previously, Cognism referred to regions as where the sales team member sits. Now, it is defined by where a company's Headquarters and GTM operations are located.
Cognism looks to go after the following regions:
Cognism organised the team around regional strategies. This meant they could continue executing a segmentation strategy and adjusting resource allocation based on where reps succeeded in their ideal customer profile. This empowered reps to create, iterate, and win.
When expanding into a new European region where you haven’t got a massive amount of data or revenue, it’s difficult to understand what industries you will succeed in and what your ICP will be. So, by using geographical groupings, you can focus on understanding your sweet spot for each region.
Once you’ve settled in a region with a wide range of customer types, you can identify the optimal industries to target and assign specific sales representatives to those verticals.
Reps in those verticals will specialise in a set industry and become thought leaders, resulting in a much higher win rate when competing with competitors.
Rob explained:
“When entering a new region such as DACH and France, we do not segment too much as we have only recently entered these markets.”
“We have someone covering the Nordic countries, as companies across Sweden, Finland, Norway, and Denmark tend to buy in similar ways. Here, it makes sense to have one AE with a background in the region covering these areas. That way they have situational fluency and are up-to-date with industry trends. Then it’s a similar story for Southern Europe.”
“In the US, it’s a lot easier to segment based on geography because of the different time zones and depth of the economies. It’s harder to cut the UK up geographically, so creating industry-based territories made the most sense.”
Once you’ve created an effective sales territory management plan, your sales and marketing teams can work together to determine the right sales tactics and messaging to push to each market and territory.
Each geographical location will have unique messaging catered to cultural and regional nuances. Adjusting your sales and marketing process to local business customs and decision-making timelines is crucial.
As Rob shared:
“If you put an AE in a scenario where they’re selling to both the US and European companies, it’s tough for them to understand how those types of companies go about an evaluation process.”
“Culture influences how people analyse and process business value and purchase products.”
“Some cultures are wired to negotiate everything to the bone. For an AE to understand how the culture impacts processes and purchases, you need to immerse them in these regions.”
“In Europe, you have so many different cultures, so the more situationally aware the AE is of the region, the better.”
“If we have this edge over our competitors, we have a better chance of winning. This also translates into pricing. If you have an AE with accounts across Europe and the US, they won’t tailor their pricing to each customer’s situation, which would negatively impact their win rate.”
A well-designed sales territory division also means your sales team can adapt your value proposition to resonate with local cultures and regulations.
Liam Bartholomew, VP of Marketing at Cognism, added:
“In DACH, you need double opt-in consent to email someone. Therefore, the email data available in the Cognism platform isn’t compliant for them to email to.”
“Pushing how Cognism has email data in DACH wouldn’t make any sense. So focusing on phones, mobile data, and enrichment makes more sense.”
Similarly, for a US-headquartered company with EMEA operations, Cognism’s value proposition would focus on providing the highest-quality, most relevant, and compliant data in EMEA.
Contrastingly, Cognism would focus on its reliable mobile data in North America for a US-headquartered company without EMEA operations. Its competitive advantage would be its Diamond Data® and the fact that it has the best mobile numbers with the highest connection rate.
You also want to ensure your content and messaging address local pain points, interests and communication styles.
For example, when expanding into Europe, Cognism found that communication styles in Germany and Switzerland often leaned towards being more direct and to the point when it came to outbound sales.
However, a more indirect and nuanced approach is more common in France and Spain, whilst British audiences generally appreciate a process that builds on relationships. Designing a territory plan helps reps become familiar with these nuances.
Here are some of the mistakes and triumphs we saw when expanding into DACH:
As mentioned, knowing which customers to prioritise is essential when approaching a new region or market. Here, defining your ICP is key.
Antoine Cornet, Head of Revenue Operations at Cognism, explained:
“You need to think about your ICP and run regression models and analytics to understand which technographic or firmographic components impact your win rate and ACV.”
“Hopefully, if your data is clean enough, you can identify a few factors that let you know the best account in each territory and where to place your bets. Once you’ve established those factors, you can also run analytics on the most important components and create an account score.”
When refining your ICP across each region, you might want to conduct surveys and interviews with potential customers, analyse successful competitors’ customer bases, and consider how cultural differences affect buying behaviour and preferences.
Once Cognism has expanded into a region, they determined its ICP by looking at the following factors:
When it comes to account allocation, you want to identify and assign key strategic accounts to specific sales managers.
Here, it’s essential to ensure each salesperson has a manageable number of accounts and sales opportunities and to align account complexities with salesperson experience and skills.
Consider language skills and cultural understanding when assigning territories and accounts.
It’s essential to evaluate the value of each account within the market and prioritise each account through your sales territory plan. That way, your sales reps won’t waste their time and can optimise their efforts and resources.
Cognism ranks accounts through tiers. When it comes to initiatives such as its ABM play, Cognism can put its best chances of success in top-tier industries and accounts.
When it comes to setting quotas and sales goals, here’s what Rob said:
“Sales targets and quota allocation starts with defining how many AEs to put in each region.”
“Before we went to this regional focus and territories, we tried to understand an AE’s average productivity and what we think is reasonable if we give them enough sales pipeline.”
“I figured out the number of AEs we should invest in each area based on that, and then I understand if the territory’s historical sales data, pipeline and revenue can support the outcome of the sales quota we are assigning. If not, we can tweak the territory to make it bigger.”
“Someone in a lower win rate territory will have to be better at sifting through a lot of pipeline and doing a lot of qualification early to figure out where to focus and win. If you don’t have as many accounts, you need to focus on higher value messaging.”
Here are some key metrics to track:
Creating an effective sales territory plan will help optimise resource allocation and improve marketing and sales efficiency.
It helps improve customer experiences by allowing businesses to develop expertise in specific industries and tailor strategies to customers, their regional business environments, and cultural nuances.
A well-structured territory design helps identify untapped markets and create consistent sales growth opportunities, making it easier to expand sales teams into new regions or industries.
It helps improve alignment with your ICP, leading to higher conversion rates, more consistent and repeatable selling motions for AEs, and higher win rates.