Zoominfo analyzed their Out of Office (OOO) emails and phone call connection rates over the past year to determine whether there was a dog days of summer impact on their business or whether it was a convenient excuse used by sales reps for taking their foot off the pedal in July and August. It turns out that there is a sustained drop off in phone connectivity and an increase in OOO messaging in July and August. For Zoominfo, the potential income loss was equal to $400,000 in monthly new Annual Contract Value (ACV).
If we extend that loss over the last week of June and the first week of September, the summer lull would result in a million dollars in lost ACV (half a million dollars in 2020 revenue, but that is only because subscription revenue is recognized over the length of the contract, not when booked).
But a firm like Zoominfo has a very high retention rate, so stratifying the million dollars over the lifetime value (LTV) of the lost opportunities means that the cumulative LTV is likely in excess of $5 million (their 2019 dollar based net retention rate was 109%)
For a company that went IPO in June after touting strong new ACV growth in their May S-1, new revenue growth is key in maintaining confidence in your revenue teams.
“How did we respond to this data? By stepping on the gas – we sent out an additional ~14k+ emails (~10% of normal volume) over the past two months and making an additional ~23k dials (~35% of normal volume) per month.
Sales is — and always will be — a contact sport.
This is just one of the reasons why it’s so important to have a vast array of contacts at prospects. Without being able to tap into our own data this wouldn’t have been possible. That’s not cheap promotion, it’s a fact.”Zoominfo CEO Henry Schuck
Around 90% of Zoominfo’s revenue is domestic, so they aren’t dealing with the long August vacations taken in Europe. The strategy of working harder over the summer allowed them to maintain new ACV growth during a soft period, but it might not be effective in Europe when business activity is reduced much more significantly.
OOO messages often provide alternate contacts that may be part of the buying committee. Acting on this intelligence and extending relationships to additional decision makers and influencers may improve both current and future close rates.
Zoominfo has a reputation for effective revenue operations management. They assumed the summer doldrum lore to be true and double downed on their outbound communications. But they also measured their sales and marketing efficiency to better understand the nature of the summer slowdown, allowing them to model and refine their summer sales strategy in the coming years.