Why People Buy

One of the most powerful attributes of value selling is that it should give you visibility on what people care about - how they're motivated, what their personal goals are, etc.

People think that they buy based on data and analysis.  But they don't. You don't. I don't. I buy the running shoes because they'll make me look faster on the trails or at Starbucks. You buy the solar panels or EV because it underscores your care for the environment. A coworker once told me that she was going to sell her 911 Cabrio to buy a Tesla (back when Tesla was cool)...because she wanted to save money on gas.

Um, no. She was going to lose thousands of dollars on the transaction, so the financial justification was weak. However, the new car was going to signal her care for the planet, which was her real motivation for the purchase.

Corporate buying is no different. Whether it's a new AI chatbot to improve the experience of your customer, or the repurchase of another thousand Chromebooks, at the base of the decision is feeling rather than data.

Here's a great quote on change management, and after all, selling is all about change management:

See – feel – change is more effective than analyze – think – change. The process used here is "See, Feel, and Change", as opposed to "Analyze, Think, and Change". The latter is all head, no heart, and often fails to motivate people to recognize the importance of a given problem.

 

As part of my enablement work, I leverage story telling, developing customer vignettes - the people, personas, their "care-abouts". I explore individual MBOs and what an MBO represents. To drive the point home for the sales people in the session, I show a jet ski, something that the lead purchaser intends to buy with their MBO. I actually get groups of sales people to yelll "jet ski" when I ask what motivates that individual.

 

They get it. 

 

Data is nice, but don't kid yourself. People don't make decisions based on TCO or ROI. Do you need to check those boxes? Absolutely. But a good ROI argument doesn't get you off BAU. Getting a customer to feel why different is better starts the real consideration process, otherwise the (perceived) RISK hurdle is just too great.

 

Lee

 

 

 

Is Value Selling a Methodology?

We designed and implemented a formal value selling methodology at Oracle and I was tangentially involved with another effort more recently.

Here's the thing about value selling. It's not just a methodology...an approach to selling. It is a mindset, a way that sales people (and others) think about preparing for, and engaging with customers. To be successful, the mindset has to be present in everything the sales person does, or the initiative fails.

Here's the rub -- everyone else  in the organization, and most of the practices and processes, is either product-centric or transactional in nature.

If you train your sales people to engage with customers focused on the business benefits of reducing risk and fraud, and your product managers focus on speeds and feeds, product/service attributes, a cognitive dissonance is created. Then the rep's manager focuses on inspection and forward movement of the opportunity, talking about pricing and contract terms. Obviously, the latter is important, but frequently it is delivered in opposition to the value selling approach/mindset.

At Oracle, the sales engineer was my primary line of reinforcement. I coached them to ask reps: "Do you have a business value hypothesis...". If the rep hadn't done the work to create a value perspective, I coached the SE to decline joining them on the sales call. The first line sales manager was my second line of reinforcement, providing a lot of coaching on business value.

We had the benefit of high level executive support for our value selling approach. It helped that many senior sales executives had risen from the ranks, had been trained on value selling and saw their average deal size grow dramatically.

Conversely, in a more recent situation, value selling was deemed a "good thing to do." And it was done.  Well done, by some very senior and knowledgeable people, people who have done it well elsewhere. But it was not supported in the field by sales management, it had little to no real executive support, and product management had to be coached, over and over, to recast their product enablement assets to be more supportive of a value selling approach.  It has not really taken hold and as a result has delivered little real value.

So...value selling is a mindset, one that has to be shared by all the relevant stakeholders, and actively supported by senior management. And as such, your primary challenge is that of change management. How will you to change the hearts and minds of the stakeholders so that your investment in value selling pays off, so that sales people can focus on the value to be co-created with customers?

Looking forward to your comments!

Thanks!

Lee

Running and Selling

In many ways, running is similar to selling. Both involve preparation, patience, diligence, sweat and a lot of "failure."

Great coaches tell their athletes to prepare for next year’s race, or the year after. Building the foundation for success takes a long time. You shouldn’t expect to do it in one season or in one quarter. The work you’re doing now will pay off down the road, way down the road.

Yet we expect our sellers to come up to speed quickly….and the quicker the better. We measure “Time to First Revenue” as a key indicator of new hire performance and of onboarding program effectiveness. What we’re probably measuring, instead, is the persistence of a pre-existing deal in the territory, or perhaps a sales manager who’s closing deals for her new reps.

And we expect immediate results each time the organization pivots, whether it’s due to a new product introduction, or a strategic shift in sales priorities, or the sudden WFH status of much of the sales organization and customer base. It’s like telling a mile specialist that next week he’s competing in the marathon, or a marathoner that she’ll be competing in an Iron Man triathlon with its multiple disciplines.

Sometimes those pivots are unavoidable. Reps are now selling 100% by phone or video conference, with no expectation that they will be able to resume face to face selling any time soon.

But here’s the thing. Selling remotely is different than selling face to face. And buying is different today. Buyers are behaving differently. Sure, many still have projects to complete (or to start). They still have project plans and milestones and MBOs. But their reality is quite different today than it was in January of this year.

Their organizational challenges have shifted, perhaps dramatically. Some of their customers, partners and consumers are out of business or out of work. Their personal challenges have increased — remote working and management, loss of traditional support systems and day care, drop in household income, sick family members, the anxiety of the unknown.

So lets take a step back, take this opportunity to pose the question — “what serves our customers, our organization now?” How can we use this time to (re)build a strong foundation — relationships with our customers and prospects, deeper set of selling and relationship management skills.

With no races on the calendar, professional coaches point out that this year presents a unique opportunity for athletes, normally in a pre-race training cycle, to focus on building a strong fitness foundation, one that will serve the athlete for years to come, to improve their results several years out.

Similarly, the enforced WFH and dramatically different selling environment presents a unique opportunity for sales people to focus on relationship development, account research and preparation, and, importantly, their emotional intelligence.

How will you ensure that your sales teams both build a foundation for future success and keep the lights on this quarter?

Thanks!

Lee

Be Impeccable With Your Word

If you’ve read The Four Agreements by Don Miguel Ruiz (available here), you recognize “Be Impeccable With Your Word” as the first agreement. We can learn a lot by applying Ruiz’s teachings to the art of selling.

Ruiz says, in part, that to be impeccable with your word, “you must speak with integrity. Say only what you mean.” And, paraphrasing, do what you say you are going to do.

So…how do we apply this to the art of selling?

It’s simple…do your account planning and pre-call prep so that you are prepared to bring value to the conversation.

• Be clear on your understanding of the organization’s challenges and opportunities, and on what your contact does each day in support of the organization’s strategic goals 
• Develop and practice your initial conversation before you pick up the phone to call your prospect. Write it out and tweak it until the customer-centric messaging is clear and your business value proposition is straightforward. Review it with a peer to ensure that you’re delivering it in a conversational style, one that is yours, and is appropriate for your prospect (region, language of value, etc.)
• Use language that is business-centric, that makes sense for a senior business (non-technical) person. Use language that helps the prospect to feel comfortable with your expertise in the process of diagnosing issues and coming up with recommendations.

And…if you make a commitment, be specific – I’ll call you at 3 pm on Thursday (versus I’ll call later this week). When you make that commitment, put it in your calendar, with a reminder, and make good on the commitment. 

Call promptly at 3 pm!

By being impeccable with your word – being easy to understand, focusing on the prospect’s key issues, using their language of value, and following through on your commitments, you will set yourself apart from most of the other vendors’ salespeople calling on the same accounts.

And, by following through on your commitments, you will lower the prospect’s perceived risk in going with you. Perceived risk is a huge factor in complex business to business sales, and while it’s not objectively measurable, it is one of the most important elements in the decision-making process. Buyers frequently will select a vendor that they believe can be trusted to deliver a solution that works, even if another vendor’s offer may be lower priced.

It’s a relationship-based decision, and we build that relationship by clarity with our words and demonstrating our trustworthiness by crisply following through on our commitments.

So…be clear in what you say, and do what you say you are going to do. While this is not difficult to do, our crazy-busy, interrupt-driven environment can sometimes make it challenging, both in finding the time to prepare and in crisply meeting our commitments.

Awareness is the first step to success.

Thanks!

Practice, Practice, Practice!

I’m in the middle of rereading Peak Performance: Elevate Your Game, Avoid Burnout, and Thrive with the New Science of Success (link) and I was surprised at the common themes that help runners, artists, surgeons and sales people all excel at their craft.

If you’re interested in excelling at sales, follow these guidelines:

#1 Context is everything

If your intent is to get through 10 calls so you can check that box and go to lunch, the calls won’t be useful to you or the prospects. On the other hand, if your intent is to solve problems, make sense of the world, talk to interesting people, improve your craft…your calls will be much productive and fun. Your prospects will enjoy talking with you; they’ll share more, they will help you to help them.

Remember, your context (or intent) is obvious to your prospect, like it’s written across your forehead or broadcast in your caller id. You will always broadcast some context, either consciously or not, so ensure that it is a powerful, positive one. (Hmm, perhaps a topic for another posting…)

#2 Practice makes perfect

Athletes and musicians practice to ensure success. And they don’t just practice, they focus on specific skills, one at a time. A pro golfer will spend a week working solely on his putting game (but not from the same spot each time). An ultra-marathoner will focus on building leg speed. A top sales person will focus on practicing the pivot or bridge from one topic to another.

We practice to build “muscle memory.” When a prospect asks us a question out of the blue, because we’ve practiced, because we’ve built that muscle memory, we can pivot to addressing the question in a useful and meaningful way. Or maybe that question doesn’t catch us off guard…because we saw something on the contact’s LinkedIn profile and gave some thought to how that might be relevant…

#3 Learn from doing

Top performers always evaluate their performance. What went well? What could he or she have done differently? What’s the learning? What new muscle memory must be created?

After you talk with a prospect or customer, think about the flow of the conversation. Were you properly prepared? Did the conversation follow the path you expected? (Hint, it never does!) Did you accomplish what you intended? Were you open to solving different problems, uncovering and exploring different issues? Did you position yourself as a resource? Did you make a deposit in the relationship bank account? Did you reach agreement on a specific follow up?

This introspection is the single most powerful thing you can do each day to identify areas for improvement, to build your selling skills. For a deep dive into learning theory, spend some time with Make It Stick by Peter Brown (link). Peter also cites some pretty interesting research on new techniques for skill development (a topic for another post.)

Leverage your resources. Use the industry and persona information provided by your organization or public resources, the treasure trove of prospect information on LinkedIn, the call and conversation planning tools needed for thoughtful preparation. Corporate Visions cites industry knowledge as being critical to successful conversations, more important than company knowledge, and far more important than product knowledge. Prepare for success!

Practice, practice, practice. It might take you 30 minutes to fill out your first call planning template. It will take you 5-10 minutes to complete your 10^th. Role play with your peers or your manager. Fine tune your conversational skills in a “safe” environment, make the mistakes in a coaching space where you will get immediate feedback. Practice your opening conversation in front of a mirror until it feels and sounds natural.

  

And pick up the phone often. You will have far greater success in holding an enrolling conversation with someone if you reach them by phone, versus trying to engage them by email. 

Thanks!

Lee

Leading Sales Indicators

Selling a complex solution is a lot like running a marathon. To be successful, you can’t just walk up to the starting line and start running. Success in the marathon takes months of preparation. For each mile of the marathon, a runner might run 20-30 miles in direct preparation. Similarly, a good enterprise sales person will dedicate 10-20 hours of preparation (research, discovery, planning) for each hour of face to face with the prospect or customer.

The successful marathoner will have a comprehensive race plan, mapping out the goal pace for each mile. Many apply these plans as temporary “race tats” on their arms, so that they can keep track of their plan while on the road. Similarly, good enterprise sales people develop detailed opportunity or pursuit plans that include both their actions and those of their teammates (other sales people on the account, sales engineers, etc.).

Marathoners carefully watch the leading indicators that help them to determine whether the individual race will be worthy of a Personal Record (PR) or perhaps just a long, slow run. For the runner, some of these leading indicators include their Heart Rate Variance (HRV) and sleep patterns in the days leading up to the race, the temperature and humidity on race day, how they feel at the start line and more.

If the racer sticks to their race plan (slower pace in the first half of the race, faster in the second), a good day is possible. Toss that race plan, run too fast in the first half of the race, and all the prep in the world won’t save you. Trust me…I know!

Similar dynamics exist in the complex enterprise sales environment. While sales management typically watches portfolio coverage as a primary indicator, it is not a leading indicator. Pipeline coverage will tell you that you are in trouble. It won’t tell you why you are in trouble…and it doesn’t give sufficient warning for early correction.

The Acelera Group Sales Productivity Framework incorporates ten rep-focused leading indicators, along with a single first line sales manager (FLSM) indicator. These indicators provide the early warning signs for a decline in sales performance, at the rep, group and region level, and point strongly to specific actions to be taken for course correction.

The ratio of prep time versus face time, as mentioned earlier, is one of these leading indicators. Depending on the specific business problem, level of prior customer intimacy and complexity of the environment, the sweet spot may be 5 or 10 to 1. When reps (or teams) diverge from the sweet spot, we can expect a looming drop in sales results.

A second leading indicator – whether a business value analysis (BVA) has been conducted – holds a similar power of predictability. Curiously, despite its significant positive impact on customer intimacy and satisfaction, deal profitability and overall sales results, the BVA is not widely used.

Complex enterprise selling should not be an ad hoc series of unrelated activities. Good preparation and effective plan execution will help the runner to complete the race and the sales rep to drive great sales results.

What are your leading indicators telling you?

Thanks!

Are Your Numbers Down?

Our numbers are down, can you help?

Many conversations with new clients typically start with this statement. Those numbers may include close rates, pipeline coverage, quota attainment, deal size, deal profitability, share of wallet, renewal rates, customer satisfaction, even sales rep retention rates.

In my experience, the problem is rarely sales skills or fundamental product issues. Almost always, the decline in sales results is driven by one of two critical issues:

• Sales people do not align with critical business issues when they first engage with their prospects. Instead, they are unconsciously positioning for a features & benefits slugfest with their competition. These top of funnel activities drive mediocre conversion rates (second meeting, third meeting, etc.), limit access to other key stakeholders and ultimately leads to the downward spiral of “who’s willing to sell more cheaply.”
• Sales people do not have the resources to be successful, including alignment with the buyer’s journey created/curated by marketing, business value analysis resources, detailed customer implementation stories, or the training & background to effectively engage in business value discussions. Sometimes they simply need more time to prepare (less administrative load) or more/better/targeted sales coaching from their manager.

In conducting root cause analysis to identify the source(s) of the problem, we work closely with the sales operations team. Sales operations has access to all of the data necessary — extensive sales metrics, personnel information, customer demographics/firmagraphics — that tell the story of success versus failure. This analysis helps to build a map of effective pursuit strategies and detailed profiles of “good” versus “bad” prospects & customers.

With the results of the data analysis, we then take a look at sales enablement practices. Typically we find gaps where the data shows weak or declining conversion rates. Occasionally this is driven by external market forces — new competitors coming into the market, customers shifting internal strategies or structural (economic) factors.

More often, we simply find a disconnect between need and investment, as many (perhaps most) sales enablement investments are focused on addressing symptoms rather than root cause.

Fixing the Symptoms

I recently spoke with executives at a fast-growing midmarket cloud security company. In a quest for continued growth, they initiated a focus on enterprise accounts…and ran into a more mature, educated, complex set of buyers. As a result, their enterprise deal close rates are lower and less profitable than midmarket. Their initial response was to seek help with negotiating skills. But lack of good negotiating skills isn’t their primary problem…they weren’t establishing business value with the right set of stake holders in the early stages of conversation.

And their sales metrics reflect the difference:

• Higher conversion rates and velocity at top of funnel for midmarket versus enterprise
• Lower connection with C-level enterprise executives
• Lower access to VPs, directors, perhaps even managers for mid-pursuit discovery in enterprise accounts

Improved negotiating skills won’t fix their weak value foundation. They must address the fundamental problem — modifying their engagement approach for enterprise customers. And when they do so, they will also see an uptick in results for an increasing portion of their midmarket customers as the market matures.

Fixing the Problem

We’re in the early stages of a sales productivity project for a large technology vendor. Analysis of their quarterly earnings reports provides early indicators of the problem:

• Declining product revenue
• Declining service renewal rates
• Fundamental changes in their market (which they’ve helped to drive)

When we dig into their SFA data, I expect to find declining engagement and conversion rates at the top of the funnel. I also expect to find higher levels of success with certain types of customers — those who purchase “as a service” more frequently. This analysis will help to identify the specific changes needed in their existing sales enablement processes.

Win/Loss Analysis…Why Bother?

Interestingly, few companies leverage win/loss analysis to help identify the problem(s). It seems there’s little appetite for understanding why a specific company said “no.” Yet an understanding of what went wrong during the engagement can provide tremendous insight into how to fix the problem!

And if done properly, the information has the weight of statistics to help ensure appropriate investment to solve the problem.

The issue of sales productivity has many levers…and knowing which levers to push is not easy. It takes both a strategic approach and good pattern matching abilities.


Thanks!

If the Purpose of Sales Enablement is to Improve Seller Behavior...

If the goal of sales enablement is to improve the behavior of sales people (and drive increased sales productivity), how should we observe or measure rep skills and success? How do we improve behavior?

Some managers accompany their reps on calls to observe the rep in action. However, these "ride-alongs" fail for two reasons:

• Most managers cannot avoid "rescuing" their rep when they get into trouble
• More importantly, the presence of the manager causes the rep to behave differently and the observation yields inaccurate or misleading feedback

Image by Erik Aavatsmark via New York Magazine

To avoid manager interference, perhaps we should try the approach of putting the manager on a tall chair in the corner (watch the cult movie Kitchen Stories to judge for yourself how well this observation approach might work!)

More importantly, how...and when...should we focus on improving behavior?

Current approaches to both measuring and improving behavior are inadequate

Typical measurements provide a "look-back" at what happened, with no direct connection between measurement and improvement techniques. Even with good performance and success metrics that accurately measure sales effectiveness, efficiency, pipeline coverage and velocity, close rates, customer satisfaction and retention, we are largely collecting trailing indicators.

Today we act on those trailing indicators. We build hypotheses of why things happened the way they did, modify the environment in some way (different content, better coaching, etc.) and wait for new trailing metrics to reflect changes in performance.

Unfortunately, this process spans multiple sales quarters and opportunities. There's no immediate feedback loop between action, result, correction, new action, new result...and without that immediate feedback, the repeated behavior is reinforced rather than corrected.

The best time to make a course correction is before you're seriously off course

When sailing a boat or riding a bike, the best time to make a correction is before you run ashore or fall over. Sailors and cyclists make dozens of tiny, imperceptible corrections --  small movement of the tiller or angle of the front wheel -- all the time, without conscious thought.

For sales enablement to be effective, we need to be able to measure the success (or performance) of the rep as he or she is engaging with a prospect or client and act on that information in realtime, with corresponding small, timely course corrections.

What we need is "in situ" measurement and sales enablement -- delivered in place, at time of action. Perhaps a "sales Fitbit" that provides realtime feedback and guidance. Measurement, feedback and course correction as the rep is doing his or her job.

Image by DC Rainmaker (Link)

When I'm training for an upcoming race, I don't wait to see my elapsed time for the race before I choose to modify my training activities. I periodically check my running watch as I'm running in training, in realtime. How's my pace? Am I in heart-rate zone 2 or 3? During recovery between Yasso 800 sprints, does my heart-rate return to a reasonable level?  With these realtime metrics, I can choose to make an immediate modification to my next training sprint rather than wait to see how I eventually perform in the race and choose to run faster sprints before the next race.

Similarly, we need to be able to measure the effectiveness of a rep as he or she is engaging with a customer. The following are some of the "realtime" measurements we need to monitor:

• Is the rep following a thought-out path of engagement?
• Is the communication in line with the customer's business needs, language of value, results expected?
• Is the rep connecting at the right level in the organization?
• How responsive is the customer?
• How timely is the rep in following up?
• Is the engagement moving along an expected path, at an appropriate pace?

And given this in-process measurement, we need to provide a learning environment that doesn't require the rep to step out of their existing work flow (day-to-day selling processes). The rep needs constant, ongoing feedback and course correction that guides the improvement of their messaging, timeliness, targeting, listening, etc., while they are undertaking the activities of connecting with prospects and customers.

Some Good News

Companies that implement a "sales Fitbit" approach of monitoring & improving sales activity see immediate, substantial and persistent improvement in customer engagement, revenue and other results. Conversation conversions double or triple. Outbound contacts double. One company saw margins increase by 25% in four months.

This in situ approach doesn't work for all companies. It requires sales organizations to revisit their messaging and to trust their sellers to learn as they go. For companies that are interested, a proof of concept will give quick feedback on whether the approach has broad applicability.


Thanks!

Lee

Alignment or Collaboration?

IDC and Lattice Engines recently hosted a diverse group of executives with a wide range of responsibilities and interests, including: corporate marketing, industry marketing, demand generation, sales operations, business operations, and customer intimacy. The following is a brief thought piece based on our conversation.

Tom Barrieau, IDC sales enablement analyst, provided a foundation for the conversation with his comments on how the buyer’s journey has changed and the impact of those changes on the disciplines of marketing and selling. Technology has enabled better, more effective, contextually relevant marketing and selling. Yet marketing and sales organizations are finding it difficult to collaborate at a high level because the processes for doing so are still being thought out…

For those of us who started our sales careers in the days of “feature and benefit” selling (how quaint!), we remember that sellers held the information and the power. Buyers were reliant on their vendors for most product and much usage information. Sellers would conduct extensive discovery about their prospects while providing that education. White papers provided a primary vehicle to educate prospects on how to acquire, implement and derive value from technology purchases.

Today, in both the B2B and B2C worlds, buyers may engage prospective vendors after having completed much, perhaps most of their research and due diligence. Buyers will leverage third party sites, forums, social media, events, etc., where they gather information (not all of it accurate, by the way!). The buyer or buying team may then initiate an RFI or RFP process based on what they’ve learned from this research.

This new world presents several challenges. A buyer or buying team may go through the process of evaluating, purchasing and implementing a specific product or service no more than once or twice in their careers and may not know all of the issues to consider or how to prioritize and value the information they gather.

Here’s a personal example…

A few years ago, as an active road cyclist, I decided to take up the sport of cyclocross racing. Long popular in Europe, cyclocross has an active community in New England and in other parts of the US. This flavor of bike racing takes place in fields and on singletrack paths, occasionally requiring jumping off the bike and running up a slope with the bike on one’s shoulder or bunnyhopping a 12 to 18” tall obstruction on the course.

I’ve been bike racing for a long time and I’m comfortable purchasing bike goodies on eBay. So I purchased a used cyclocross bike on Ebay, from one of the top builders in Europe. Got a pretty good deal. The only problem with the bike was its color – an unattractive mustard yellow. I visited a local bike builder, Toby Stanton of Hot Tubes, who offered frame refinishing services and asked him to repaint the frame in my favorite color – a deep blue.

Toby asked why I wanted to have the frame repainted.

I responded: “Because I don’t like the color…”

He responded: “Well sure, I could paint it for you, but it still won’t fit you properly…

As an uninformed buyer, I made the incorrect assumption that a cyclocross frame should be the same size as my road frame. A knowledgeable seller, if I had engaged with one rather than venturing out on eBay, would have caught my mistake early in the engagement process. Fortunately Toby didn't follow me down the path; instead he offered to build me a sweet custom deep blue cyclocross frame, which I'm still riding and racing 15 years later!

It’s the job of knowledgeable sellers to guide their buyers through their process, to help them avoid the mistakes they would otherwise make because they simply lack the experience of evaluating/acquiring a specific type of product or service.

Technology allows us to conduct some of that buyer discovery independently of any specific interactions with the buyer. Today, when a B2B buyer first visits a website, data augmentation techniques allow us to build a comprehensive profile of the buyer’s organization – all of that company’s firmographics, technology stack, prior engagements with the company, even a propensity to buy based on the company’s success model. It’s even possible to append specific psychographic information to an individual visitor.

Contextual Relevance

This capability allows companies to respond via their marketing automation platform with contextually relevant information.

Hospitals use different language than insurance companies. Buy side versus sell side. Public sector versus private. Discrete versus process manufacturing. Consulting versus professional services. Large company versus small. Hierarchical business model versus federated. Open source versus proprietary. Cloud versus on-prem. VC funded versus family owned.

Use the wrong language, the contextually incorrect information, and you will be moved to the bottom of the list. “That company just doesn’t understand us…”

Most companies understand this requirement, and many are moving to implement the capability. The challenge is not technical; it’s a process problem. Who’s going to create all of the contextually relevant content? Who will keep it fresh? How do we know we’ve got it right? And organizations, aware that much of their externally facing content is never consumed, are reluctant to create more. Just think of all the permutations…size X ownership model X industry X tech stack X growth rate…

An Early Warning System

Technology also helps companies to identify prospects just starting out in their buying journey, months before they first visit the company’s website or engage with a sales person. Consider the case of a midsized financial services firm, whose board has just mandated an active focus on security and specific actions to be taken within the current fiscal year. Senior executives, managers and individual contributors will start researching security issues and options – DDOS, managed security, mobile device management, personnel background checks, etc.

This activity will rise beyond the “normal” level of casual browsing…more people at a given company conducting research, a concentration on specific topics, search terms, vendors, etc. A buying group is in the process of forming. And their online behavior is signaling “intent.”

Intent monitoring allows a provider to identify this early interest and to act accordingly. In a few cases, due to prior history or target company status, it might be appropriate for a sales person to place a call directly to the Chief Information Security Officer. More commonly, the proper response is for the provider to implement (or expand) a targeted nurture marketing campaign with contextually relevant display advertising, marketing emails, etc. If done correctly, the campaign will both inform and steer the nascent buying committee, perhaps making the case for managed services or sharing a well thought out security evaluation process published by an industry analyst firm.

Mind the Gap

The unknown ground, the gap, so to speak, is how to effectively include/engage/enable the sales team in this process. The buyer (or the buying team) is undertaking a potentially lengthy buying process or journey, one that might take months before they, organically, initiate contact with any vendors. So, how do we enable the sales person to follow the buyer in that journey, to engage at the proper time, and to be on the same page, so to speak, as the buyer. Or…to be slightly ahead of the buyer and be just a bit provocative (provocation based selling) or challenging (the challenger model) in their approach. In this case, the sales person must have a good grounding in the customer’s business, their industry and the lessons learned from other customers.

Actions to Take

If you’re a savvy marketer or sales operations executive, you already know that you can accelerate your revenue flow with the proper application of technology.

The devil is in the details…so sit down with your sales or marketing counterparts, select a bite size opportunity, map out the processes, content and technology required for success.

Engage with your trusted vendors for their advice and counsel; they’ve been through this before and they can help you identify best practices and potential pitfalls. Make sure you have executive sponsorship and support, sales leadership buy-in, and enough runway that you can actually prove your hypotheses.

·       Give up the concept of marketing and sales alignment. Alignment simply means “agreement or having common goals.”

·       Adopt the context of marketing and sales collaboration. Collaboration requires both alignment and relevant, shared action to further those common goals.

And remember, you’re not the only one facing these challenges and opportunities!

Thanks,

Lee

What is the Compelling Event?

Google “What is a sales opportunity” and you will find some five hundred million pages to view. Conversely, if you Google “What is a compelling sales event”, you will find less than four million results.

With sales teams, the results are similar. Most will have a plethora of sales opportunities; many fewer will be able to identify the compelling event that will cause their sales opportunity to move forward with velocity.

The absence of a compelling event does not rule out the possibility that the prospect will take action. Organizations frequently take action based on a risk/reward analysis. I change the synthetic oil in my cars every 7,500 miles whether or not the engine is making abnormal sounds; indeed I pay a premium for synthetic oil and change it regularly to reduce the likelihood of abnormal sounds and engine damage. For the oil change, my compelling event is the identification of a spare 30 minutes on a Saturday morning. If it’s sunny, the oil change is deferred and the bike gets ridden. In this scenario, if the deferral goes on long enough, I decide that the oil change cannot wait any longer and it gets a higher priority than the bike ride.

On the other hand, the end of a car lease is a compelling event. If the lease is over on February 28, the car must be turned in by February 28. (This begs the question as to whether anyone changes the oil on a leased vehicle).

Similarly in sales, most responses to the question “what is the compelling event” driving this opportunity initiates a conversation about the symptoms or factors that may drive a risk/reward decision. “The system is performing poorly.” “We’re running out of space/power in the data center.” “Profitability is down.” “The CIO thinks our stuff is cool.”

None of these will cause the organization to act. How long can the company continue to run with a poorly performing system, without any spare space/power in the data center, with low profitability? Many function for years in this environment, choosing to invest in other, higher priority activities or to make no investment (all too common over the past couple of years.)

A workable definition of the compelling event is as follows:

A compelling event has an economic owner, a defined date and is a direct response to a business pressure. The action is expected to deliver a significant business result (either improving opportunity/capability or reducing pain). The compelling event defines the reason for the economic owner to act.

The compelling event, or its absence, is a strong leading indicator for the probability of success regarding the opportunity.

The symptoms described above may well be contributing to a risk/reward decision. I coach sales teams to look beyond the symptoms (and the technical owners of those problems) and identify for the economic owner. If that economic owner has chosen to address the issue, he or she will have a project plan with milestones and actions. The technical owners will hold the pieces of that plan but may not be able to identify the underlying plan. Once the sales team connects with the economic owner, a discovery process will determine whether the opportunity is real, the “fit” between seller and buyer, and ultimately the likelihood of success.

It’s time to surgically remove the sales person’s “happy ears” (“they think our stuff is cool…I have a deal!”)  and train them to focus on issues of real importance to their customers…issues that have significant business value when addressed.

Happy Selling!

Lee

Why Johnnie Can't Buy

Corporate IT buyers report that completing a typical enterprise IT purchase takes more than five months, two months more than they would prefer. While they blame their vendors for contributing to just over a quarter of the delay, they acknowledge that their own faulty buying processes contribute to two-thirds of the delay (source: IDC 2011 Buyer Experience Study).

What’s going on here? Why can’t buying teams be more efficient with their enterprise IT purchases?

It’s not their fault…mostly.

Many, perhaps most buying teams are assembled on an ad hoc basis to address a specific business issue. They may have little or no experience in working with one another and limited (if any) experience in evaluating, purchasing and implementing the specific product or application. After all, this is probably a one-time exercise for them. As a result, they lack the structure and processes necessary to identify and prioritize critical business requirements, application and service criteria, implementation challenges and more.

Typically, the members of the buying team with repeat buying experience include those from IT, Finance or Procurement. These participants tend to focus the discussions on either technical or cost details…not where most vendors want to focus (or where the buying team should focus!). Few buying teams include formal facilitators with deep process experience who can extract the critical business requirements and develop consensus among the members of the team.

Selling teams, on the other hand, engage with buying teams every day. They work with multiple organizations and handle the same set of questions, concerns and objections over and over. They see the patterns across these organizations. Based on these repeated experiences, the selling team should know what’s important to the individual buyer and be able to propose a well-thought out evaluation and decision framework.

While the selling team is in a unique position to guide their prospect through the consideration and evaluation process, most don’t. They either don’t believe that it’s their job to do so or out of habit they defer to the buyer’s (flawed) processes.

Top salespeople will identify the void in the buying team’s experience and assist them in identifying and prioritizing critical business requirements and in developing consensus among the members of the team. They do this naturally and without specific attachment to individual outcomes. If the fit isn’t right, they disqualify the prospect and move on to other opportunities. A few large vendor organizations incorporate engagement project managers on their enterprise account teams to help ensure this focus (and the delivery of the appropriate resources at the right time throughout the engagement process).

B and C level sales people, on the other hand, work within the buyer’s flawed processes, searching to match their assets with what appears to be important to the buyer. Since the critical business requirements are a moving target in this environment, the sales person will never really connect. Purchase decisions are made on faulty assumptions and the desired business results may never be reached.

Enterprise buyers place tremendous value on the consultative capability of their vendors. They know that their vendors work with a wide variety of organizations and can bring deep and broad implementation and business expertise to the table. It’s up to sales management to ensure that this expertise is developed and offered as a primary benefit of the relationship. It also requires a shift in focus from “solution selling” to true consultative selling. (See Buyers Don’t Want Solutions for a deeper discussion of why solution selling is bad.)

In adopting and fostering this consultative approach, the vendor will move from simple (and fungible) “vendor” to “trusted advisor” status and enjoy higher sales productivity, share of wallet and customer satisfaction.

Resources: I’d strongly suggest the book entitled Mastering the Complex Sale by Jeff Thull. Jeff has developed a formal process for managing consultative selling opportunities, one that helps to surface the key decision criteria and to gain consensus on the value and weight of those criteria.  You can purchase it here on Amazon.

I'd also recommend taking a look at the emerging vendor LeveragePoint. A spin-out of the Monitor Group, LeveragePoint provides an environment that assists sellers in surfacing and validating the handful of key decision criteria and in weighting those criteria to support optimized pricing on a deal-by-deal basis.

Thanks,

Lee

Marketing Plans and Sales Executes

Marketing plans and sales executes.

Okay, so it’s not quite that cut-and-dry, but in considering the roles of the two organizations, we find some key distinctions.

Marketing - Step 1

Marketing sets the “tone” in the market before sales engages with individual prospects. Marketing identifies the “best prospects” based on market size, competitive environment, and product or service capabilities. Marketing establishes the overall value proposition – “our products solve this problem”, the positioning, pricing, etc. Marketing creates the sales assets used in developing individual opportunities.

Selling - Step 2

Sales follows through to establish the relevancy of the offering for individual prospects and converts prospects into customers.

I’m simplifying a bit…

In this model, step 1 naturally precedes step 2. You sand before you paint. You scramble the eggs before you cook. You date before you marry. Step 1 is necessary for the success of step 2.

A change in step 2 requires changes in step 1. Cooking paella requires different preparation than that for cooking an omelet.  To transform sales, you must create a new set of preparations in step 1 (marketing).

Results are what matter

We don’t actually care about sales transformation; instead we care about the results of sales transformation. In this conversation, we don’t even care much about the short term results of sales, what we’re focusing on is building a more robust, healthy business, a qualitatively better set of results.

Selling is a means to this end -- the creation of profitable, long-lasting relationships between buyers and sellers. These profitable, long-lasting relationships generate the highest shareholder value.  And what shareholders really care about is shareholder value (not this quarter’s sales).

Unfortunately, our current set of preparations (in marketing) doesn’t usually lead to that end. If measured using the Six Sigma scale, selling is at best a one sigma activity. Buyers complain that less than a third of their sales people show up “very prepared” for sales calls. Buyers cite a poor relationship with their vendor as a primary reason for switching vendors. More than 50% of all reps failed to make quota last year. (Source IDC 2010)

Vendors are failing miserably to meet the relatively low expectations of their buyers. In talking with senior executives at Global Fortune 500 companies, I repeatedly hear stories of sales people driving to a deal rather than building relationships. One executive at a global financial services firm described a storage rep who, despite being invited to coordinate a brainstorming session, essentially showed up with an order pad and an expectation of booking something that day. The damage to the relationship by his actions can be measured in the millions of dollars of lost revenue.

Most vendors mean well. They want their sales people to do the right thing. They hope that their sales people are doing the right thing. They need their sales people to be doing the right thing. But wanting and hoping and needing don’t constitute a strategy.

To create more productive, profitable relationships between buyers and sellers that actually drive shareholder value for both sides, both parties must commit to change. Both parties must invest in the relationship. If vendors do not make this investment, buyers will treat them as commoditized suppliers rather than value-adding partners.

Where to start?

A good place to start is to evaluate the needs of your best customers. What value do you provide these customers? What other organizations have similar needs? How should your engagement process change to enable more value creation and transfer? What else must change within your organization to ensure consistency?

If you undertake sales transformation with the goal of improving relationships with your customers and actually make the changes necessary to ensure this transformation, you will be rewarded with higher share of wallet, longer, more profitable relationships with your customers, higher revenues and profits, and increased employee satisfaction.

Seems like a no-brainer to me!

Thanks,

Lee

Sales Transformation Starts in Marketing

Five years ago, I launched a consulting practice at IDC with the express goal of “fixing how the technology industry sells.” We made a lot of progress over the years, developing a formal sales productivity framework that provided a context for the conversation, identifying specific improvements for selling and related processes and changed team roles. Many of the practice clients have made substantive improvements in their sales productivity.

Today, however, most organizations remain stuck in their old paradigm – “let’s get what we can from our customers now”, or “we’ll get to transformation later, right now we have to keep the lights on.”

And I know why.

For most, what they’ve been doing is “good enough.” It has kept the lights on, engineering fed, sales people paid, investors or shareholders happy. Few technology organizations want to believe that their approach to selling is broken, that it’s damaging to long-term (and sometimes short-term) relationships, that the adversarial relationship that they create with prospects and customers is simply unhealthy for both organizations.

But “good enough” is crap.

It’s "short-term, this quarter" thinking, it serves nobody, and it robs the company of the opportunity to build real profitability and shareholder value into the relationship for everyone.

My ongoing research supports this perspective. Buyers willingly switch suppliers at the drop of a hat because they see no real engagement or commitment on the part of their suppliers. Buyers report that sales people continue to show up unprepared for the conversation with their key prospects. They do this not because they’re lazy or stupid (far from it!), but because it’s accepted by their own company. Sellers simply don't invest in the processes and resources to create the possibility of a powerful, productive, profitable relationship.

Sure, buyers have some culpability here too, but that’s a different conversation, one that led me to create the concept of a “Buyer-Seller API” a few years ago. For now, let’s focus on the sellers. While the buyers may have the upper hand with regard to the availability of information, it is the sellers that have the goods. And buyers need these goods to improve their productivity or competitiveness or customer service.

So let’s consider the possibility of creating powerful, productive, profitable buyer-seller relationships. Sure sounds better than fixing something that’s broken.

What do powerful, productive, profitable buyer-seller relationships look like?

We’ve all experienced great transactions…when I asked this question during my keynote at an executive lunch seminar in the fall, most of the audience indicated that they had recently experienced positive, productive transactions as buyers.

But transactions aren’t relationships…transactions can lead to relationships, or conversely, relationships can lead to transactions. For example, last summer Diane, a senior IBM executive, was clear with me – she had neither budget nor need for my services. What she was looking for was information, a conversation with a similarly minded person that might help her to do her job better.

Most transaction-oriented sales people would simply have moved on; I engaged in the conversation she needed to have and started to build a relationship of trust with her. Several months later I received a call from another senior executive, a referral from Diane that led to the first formal agreement between IBM and my company. And through that transaction, I'm starting to build a relationship with the person Diane referred to me.

How do we create powerful, productive, profitable buyer-seller relationships?

I’ll sign off with this teaser – it begins in marketing. Not in sales, where the dysfunction is so visible, but in marketing, which is tasked to provide both the Voice of the Customer and the overall direction for the company. Nowhere else do the market inputs and outputs meet so concisely; as a result, it’s up to marketing (with the necessary blessing and support of the executive team...and the active participation of sales) to drive sales transformation.

My next post will explore this question…stay tuned.

Thanks,

Lee

The Late Apex is the Fastest Line to the Sale

In auto racing, the fastest line through a corner is usually a “late apex.” Rather than braking, turning early, and then accelerating after the corner, a late apex takes a straight line deeper into the corner, braking, turning and taking another straight line through the corner and out. It’s typically faster because the car is at speed longer down the straight and faster through and out of the turn.

In sales, the late apex is also the preferred line. Most sales people, as soon as they sniff an opportunity, start “turning into” it (the early apex). They give up on the initial line of discovery – learning about the prospect, their needs, pains, challenges – and turn into it – pitching and presenting. This pitching and presenting takes the salesperson off-track and the sale is lost.

Experienced salespeople will continue on the initial line of discovery until they find the right moment to turn in (the late apex). At this point, they know where they are going with the conversation and it may well be a straight line through the corner and on down the track…or in sales terms, they have found a good match between the prospect’s key issue and their ability to address that issue. At this point they are “co-creating” the solution with the prospect in a linear way.

This way of driving (or selling) feels odd at first. It doesn’t follow the natural contour of the road (or sales conversation). It requires intestinal fortitude to drive deeper into the corner and then turn, or to continue to probe on issues without talking about capabilities or features.

With experience, this different approach becomes more natural. You enter the corner later, you spend less time in the turn, and you accelerate out of the turn more quickly. Similarly, you develop a better understanding of the prospect’s challenges and environment and once you move to develop the solution, it’s a straight line to complete the process…often with the prospect asking “how do we get started?”

Music to every sales person’s ears!

Thanks,

Lee

Winning in 2010

While 2009 was a difficult year, 2010 represents tremendous opportunity. Early indicators suggest that the economy is on the mend. While I don't expect budgets and activities to return to 2007 levels, executives have stopped behaving like ostriches and are increasingly considering how to build and improve business operations.We're seeing this in both our own client base and in our daily conversations with hundreds of IT decision makers.

I've called the fourth quarter of 2009 the most important quarter of the decade. Hopefully, you ended the quarter strongly and are well positioned for success in 2010 and beyond. This new quarter will also be critical -- market share is still up for grabs and as you solidify your position within accounts and markets, you will be ensuring future profitability for many years to come.

Weaker competitors are still sitting on the sidelines, wondering what has happened and whether their fortunes will ever change. Agile competitors have already launched new tactics to gain market share in well defined target segments.

To help you move forward strongly, I'll provide some context and the sales productivity framework Tom Barrieau and I developed at IDC. The framework includes the following five major levers of sales productivity:

• Talent Management
• Sales Management
• Sales Methodology
• Sales Enablement
• Customer Intelligence

Each of these five levers incorporates a number of elements. In the interest of time, we won't go into those today. Additionally, we're going to leave off the discussion of the heart of the framework itself -- the issue of sales productivity.

Sales productivity is a meaty issue. Most B2B organizations have some definition of sales productivity and in our experience most of those definitions lead to one rathole or another. (Hint -- it's not the number of calls a rep makes or the amount of revenue delivered in a given time period).

For an initial discussion of sales productivity measures, please see the IDC best practices report we published in 2008 on sales metrics and KPIs. This report will help you to start thinking about how you can collect the sales metrics and KPIs that allow you to measure true sales productivity and leverage that knowledge into action that improves your productivity.

That's an important big picture discussion, but not one that will help you to improve your performance next month. You need to balance the important and urgent tasks (See the Covey matrix to the right). If you ignore the important tasks, they will eventually become urgent...and how most sales organizations manage sales productivity is becoming urgent.

Today, however, the urgent tasks are becoming even more urgent. The steps to ensure improved revenue performance over the next two quarters boil down to the following:

• Sales people must have the right conversations with the right prospects at the right time!

It seems so simple. Yet most larger B2B sales organizations are still working on organizational realignment, tactics to extract more revenue with their existing customers or what to do about a competitive threat. While these are useful discussions, they must not form the basis of your market development strategy.

If you can get past those discussions, here are the steps to take. They map to the three levers listed above in italics:

#1. Target the Right Prospects and Customers at the Right Time (Customer Intelligence)

This is simple. You have useful data in your customer and prospect databases. Ask a couple of your best and brightest business analysts to answer the questions:

• Which of our prospects said "no" to us six to nine months ago?
• Which of our prospects has contracts coming up for renewal in the next three months?
• Which of our competitors is having a tough time in the market?
• What is the buying profile of our customers? After they've bought something from us, what is the next most likely purchase, and when does that purchase typically happen?
• What triggers signal buying intent?
  
• Which of our prospects is growing fastest?
• Which of our clients is growing fastest?

Once you've completed this analysis (and you should be conducting it at least quarterly), you'll have a series of lists of sales targets and a good set of "stories" as to when and why a particular target will buy. Work with field marketing to deliver targeted messages. Work with sales operations to parse out the targets on a controlled, measured basis. Monitor the results carefully -- some of these segments will respond better than others, and you will want to shift your marketing and sales resources to the most productive segments.

#2. Deliver the Right Conversations (Sales Enablement)

As part of this initiative, you will need to rearchitect the sales conversations. What are the key "care-abouts" of a given client or prospect? Why should a given prospect buy now? Why should a client upgrade now? (Hint, it's not because you need the revenue!). Deliver these new sales conversations as scripts for territory reps and channel partners. Deliver them as podcasts for enterprise reps and channel partners. Validate those conversations by asking for feedback. Congratulations, you've now just improved your sales enablement capabilities.

#3. Ensure the Right Behaviors (Sales Management)

You've got a secret weapon in your sales organization. This secret weapon can be used to significantly improve sales performance and results, yet in most organizations this resource is spending most of its time filling out reports to deliver to management. Oops.

This secret weapon is your first line sales manager. When the manager spends most of his or her time coaching reps, rep performance soars. In the short term, lighten up on the managers' reporting responsibilities. In the longer term, rearchitect this role so that it is a coaching role rather than a data management role. For a deep discussion of the first line sales manager role and related best practices, take a look at this recent IDC report.

Effective sales management also ensures the application of the appropriate resources to specific pipeline development activities. While few organizations expect their highly paid enterprise reps to be conducting marketing activities, these same reps may be expected to both cold call new opportunities and to manage existing relationships. Savvy organizations disaggregate the sales function, applying specialized resources to specific tasks. (I'll cover this issue in detail in an upcoming newsletter).

Good luck out there. And please, take these issues on with the sense of urgency that they require.


Thanks,

Lee