Okay, you’re probably here to clear up some confusion between the functions of sales vs business development.
And yeah. There’s a good reason for that confusion.
The truth is, sales and business development have a lot in common – and a lot of overlap.
But at their heart, they’re actually two very different things.
Let’s figure out exactly what those differences are, shall we?
Table of Contents
- Sales vs Business Development: The Basics
- Sales vs Business Development: The Main Differences
- Sales vs Business Development: The Similarities
- Why the Confusion?
- Does the Job Title Really Matter?
- What to do Next
Sales vs Business Development: The Basics
We’ll start with a brief overview of sales vs business development.
What is sales?
Sales is a process that allows a business to seek out and sell products/services to new customers.
Depending on the sales methodology you use, that might mean becoming an advisor for a prospect and guiding them through a decision, pitching your product as a solution to a problem, or just hammering them with emails until they give in (which I don’t recommend).
In any case, sales typically focuses on meeting short- to mid-term objectives. You already have a target audience and a product, so a salesperson’s job is to close that gap – and put your product in the hands of more customers.
What is business development?
Business development is a set of strategies and processes used to put the business in a position to land more sales and generate more revenue long-term.
It includes things like market research, product R&D, marketing analytics, sales analytics, and interdepartmental cooperation to achieve long-term goals.
Sales vs Business Development: The Main Differences
Business development is:
- High-level. The business development team is focused on big-picture questions. For example, who is the right target audience for your brand? Who are your biggest competitors and how can you differentiate your business from theirs? What are your biggest opportunities for growth and how can you take advantage of them?
- Long-term. There’s not much “short-term” about business development. Business development professionals are typically focused on years-long time horizons. They’re looking into new products and services that might not hit shelves for another year. They’re investigating target audiences that might not take center stage for years to come.
- Strategic. Business development also looks at a company’s overarching strategies. How is this company going to develop and improve over the years? Which channels are best for reaching new audiences? What combination of new products, new marketing approaches, and even new sales methodologies will be best?
- Internal. While business development departments have to do a lot of external research, studying target audiences and customer feedback, most of their work is internal. They foster the development of new products and services, they work with internal teams, they refine and reconstruct marketing and sales strategies, and so on.
Sales, by contrast, is:
- Low-level. Don’t take this as a personal insult! But sales is focused on ground-level tactics. Top-down, a sales team manager will set the tone and shape the overarching strategy, but each sales rep is basically responsible for building relationships and closing deals. They’re face to face with customers on a daily basis.
- Short-term. It’s true that some B2B companies and some products with long sales cycles have long time horizons. Sometimes, it takes months or years to get a customer relationship to an adequate point. Even so, compared to the decades-long time horizons of business development, sales strategies are mostly focused on the short term.
- Tactical. Sales strategies are important, but the team will likely focus more on tactics. What are the messages, follow-ups, and pitches that are going to help you close the deal? By the time a sales rep steps in, a prospect will likely be aware of your brand and at least vaguely familiar with your work; so what does it take to finish things?
- External. Sales teams do have to do some internal work, collaborating with other departments and training the team, but its primary objectives are outbound. Sales reps work with customers and decision makers from other companies as the main part of their job.
Sales vs Business Development: The Similarities
Of course, there are some key aspects that sales and business development have in common:
- A focus on profitability and growth. Both sales and business development departments have the objective to increase the profitability of a given business and improve growth. Both of them want the company to achieve more sales and generate more revenue, both short-term and long-term.
- Audience-centric research and improvement. Everyone on both teams is going to be listening carefully to their target audience – and reshaping the business and their individual strategies to serve them. Business development has the added responsibility of helping to find new customers, but both departments want more customers to be happy with the business.
- Synergies with other departments. To achieve the best results, business development and sales departments need to work closely with other departments – especially marketing. When every team within your business is working together harmoniously, you can achieve much better results.
Why the Confusion?
Hopefully, I’ve done a decent job of making the core differences between sales and business development clear.
So why is it so easy to confuse them?
Significant overlap. Both departments have to conduct market research. Both departments have to achieve higher revenue and faster growth for the business. Both need to manage analytics and change up their strategies from time to time.
A rebranding of sales. A lot of companies have started using “business development” as a lazy way to rebrand “sales.” They hire sales reps as “business development managers” or something similar to mask the fact that their biggest responsibility is sales. On some level, it makes team members feel more important – but more to the point, it softens the apprehensions of new prospects judging a point of contact by their job title.
Does the Job Title Really Matter?
Am I just being pedantic here?
At the end of the day, it doesn’t matter what you call your sales reps. Or what you call your business development managers. You can call them “Trafalzians” and “Luganordics” for all I care.
But it does matter how you divide up responsibilities in your organization, and how you think about the future of your company.
For example, if you focus too heavily on business development without an adequate focus on sales, you’ll end up with short-term cash shortages – and even the best long-term development strategies won’t be enough to help your business grow.
If you focus too heavily on sales without business development, you’ll float along just fine – but your business will eventually stall out and stop growing.
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Most businesses need to focus on both sales and business development if they’re going to thrive.
Again, it doesn’t matter what name you call these departments; all that matters is that you distribute these responsibilities.
What to do Next
With your newfound knowledge of sales vs business development, what actionable steps can you take to make your company better?
These are a good start:
1. Find your company’s gaps.
Look at the differences between sales and business development as they relate to your company, specifically. What are your long-term goals? What are your short-term goals?
Think about the responsibilities currently being covered by your team members; how would you categorize them?
Are some of your team members better suited to one area over the other? Are any of the responsibilities I listed above not being handled by any members of your team currently?
2. Analyze and improve.
Anyone with sales management experience knows the importance of looking at the data. Both your sales and business development teams need to be basing their decisions, strategies, and tactics on the results of their analytics.
Get the tools you need to measure your results and forecast the changes to your business to come in the future. These including marketing analytics, sales analytics, and research platforms.
Only with a close look at objective data (and some creative, critical thinking) will you come to the conclusions that can take your business forward.
3. Establish feedback loops between departments.
Install and nurture “feedback loops” within each individual department and between those departments. Each member of your team should feel not only comfortable, but encouraged to share their opinions about what is and what isn’t working.
This is important to prevent the development of silos. If your business development team believes a certain strategy will work well on paper, but your sales reps find that customers have a different point of view, your business dev managers will need to know so they can figure something else out.
Open communication and collaborative improvements are the keys to developing effectively in both areas.
While we’re talking about differences, I have a good one for you.
What’s the difference between an efficient salesperson and an inefficient one?
There’s no punchline. Just a hard truth.
The difference is that the efficient salesperson makes data-driven decisions. They know what they’re doing well. They know what they’re doing poorly. They have the information they need to do better, and they’re willing to put in the effort to do it.
But to get the right data, you need the right tools – which is why EmailAnalytics exists.
With EmailAnalytics, you’ll be able to visualize your team’s email activity, including incoming and outgoing emails, ongoing email threads, and average email response time – a critical KPI for sales teams.
Did you know that 35-50% of sales go to the vendor that responds first? And that your close rate goes up by 700% if you respond within 1 hour to new leads? Yep!
And remember, that which gets measured gets improved.
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Jayson is a long-time columnist for Forbes, Entrepreneur, BusinessInsider, Inc.com, and various other major media publications, where he has authored over 1,000 articles since 2012, covering technology, marketing, and entrepreneurship. He keynoted the 2013 MarketingProfs University, and won the “Entrepreneur Blogger of the Year” award in 2015 from the Oxford Center for Entrepreneurs. In 2010, he founded a marketing agency that appeared on the Inc. 5000 before selling it in January of 2019, and he is now the CEO of EmailAnalytics.