We all know that product and company strengths are crucial to fight commoditisation. But way too many companies I met in recent years, primarily focus on communicating their organisational strengths to the market. And all too often in product communication, they say what they all say.
It is amazing that sales and marketing rarely ask themselves to what extend prospects are able to perceive competitive difference. The main question they should be asking themselves is:
Can prospects who never bought our product (or used our type of product) understand the difference with competitive offerings?
Is your organisation, like many companies today, struggling to quantify the difference of your product in value for the customer? Then here are 5 tips to help you turn the tide:
- Divide your strengths in presales and post sales features,
depending on whether or not your customer has previous experience with similar offerings
- Link those strengths to situations in the customer organisation, which lead to quantifiable problems
- Surface who is the most impacted player in the customer organisation by the above
- Talk to existing customers and get quantified information on their situation before and after using your solution
- Convert all of above in sales ready, lip loading deliverables
Take it further than productising this information; also explain whom to ask which questions
(beware: if you provide ‘arguments’ to sales, they will use those instead of asking questions!)
Marketing will keep your deliverables up to date, in interaction with sales updating on new experiences in the field. This will allow you to building a true cross departmental, learning organisation. Taking the information into account in your product road map, will create a lasting perceived differentiation for your product.
Let us know how above is improving your impact in the market.
At Perpetos, we see an increasing demand for support in establishing better pipeline visibility and more reliable forecasting. Isn’t this surprising, as many companies have implemented a sales process and CRM over the past 15 years?
They were driven mainly by the following challenges in random order:
- Visibility on pipeline and forecast
- Centralised database of prospects and clients
- Marketing searching to add value and better understand the market
- Streamlining pre-sales, sales and marketing activities
Above all, managers were looking for a repeatable process to improve their hit-rate and decrease the cost of sales.
But most of these companies have been facing a couple of negative implications along the way:
- Inward looking organisation
The ‘process’ forced people to compare and analyse which actions led to deals won or lost. To create a successful repeatable process, companies started pushing actions that presumably have a positive effect on the sales cycle. But those companies who already measure pipeline velocity and decision date visibility, know that the opposite is true in complex buying cycles. Sales will eventually loose focus on the prospect.
- Subjective status and success probability
I sometimes see implementations where ’sending a proposal’ is being linked to the degree of probability to win the deal. Could anyone explain why sending a proposal after a demo will increase chances, let alone give an indication of the prospect’s decision date? This is another myth created over time by people designing processes.
- Unreliable management reporting
You only have to look at the amount of deals expected to be closed the last day of a quarter according to CRM data to see what I mean. A CFO recently told me that he is typically using between 22 and 28% of the sales forecast for his budget ..
- Sales management increasing pressure on their team
Opportunities being created upon or just before closing, is only one of the many symptoms I see time and time again. Sales are hiding opportunities: they are afraid of what full openness might do tho their targets and/or pressure from management.
The sum of all the above is that co-workers in many organisations are:
- Managing spreadsheets and reports
- Managing the end of the pipeline instead of the entry
- Under pressure for unrealistic hit-rates because of a starved pipeline
I will come back with some simple remedies and solutions for the above issues in future blog posts.
What is your experience?
We often see Sales & Marketing departments working from different planets. Over 90% of marketing support tools and training goes unused by sales people, who spend 40 to 60 hours a month of selling time (!) re-purposing customer communications. The one accuses the other for low lead conversion rates. Sales mostly blame Marketers to be out of touch with customers. In short, they don’t get along. Isn’t this remarkable?
For Senior Management, it is often difficult to quantify the impact of poor alignment on corporate performance. But let’s face the facts: what does a stop to the battle between Sales & Marketing have on offer?
- Sales cycles get shorter
- Market entry cost goes down
- Lower Cost of Sales
Apart from considerable cost decrease opportunities, working together as a team directly impacts revenue. Think of aligned brand and product messages enhancing the company’s reputation in the market. Or increased profits when Sales follow up Marketing campaigns more effectively.
Everybody will agree that Sales & Marketing are supposed to work towards a common goal: maximising the company’s potential. Now what to do to close the gap between the 2 departments? Here are a few tips to get started:
- Introducing a common language is an absolute must
A common language enables development of goals and messaging that will be shared over departments and which every individual agrees upon. Also, it will become much easier to introduce aligned quantification and qualification criteria, e.g. for leads and campaign goals/results. Sales & Marketing will be able to correct and enhance each other’s work, and work together to achieve shared business goals.
- Aligning Sales & Marketing with customers’ readiness to buy
Most often, Sales & Marketing are driven by internal processes rather than the customer’s buying cycle. They will be giving company and product presentations, demo’s, sending proposals, etc … too often without any result. Sales & Marketing should learn together to understand the mental phases your customers are going through to come to a buying decision. These common insights will support Marketing to deliver sales-ready materials and Sales to better perform in the field.
- Introducing an experience sharing platform
Sales will learn from each other and Marketing will get a better grasp of what is really going on in the field. The platform consists of a small set of sales-ready deliverables which are kept up to date per segment and key-contacts in the buying process. Regular sales meetings with best practice sharing and assisted by marketing are the starting point. Ask your sales to send a blackberry style email with the summary of meetings (especially on pains, challenges and capabilities) and make sure marketing has access to that information in order to keep the best practice up to date.
Curious to learn about your experience with Sales & Marketing battles!
How to questions from readers and customers prompted me to write an add-on to my previous post on funnel management.
The first thing that has to be said is that few companies have changed their sales approach in an appreciable way over the last few decades. Yet buyers are seeking to buy and not to be sold to for over a decade.
I still see sales trainings and managers telling their sales and to look at the sales cycle and behave in an way that is inward looking. Sales force automation (SFA) and customer relation management systems (CRM) haven’t really helped to convert the front-line in an outward looking mode and helping people to buy from them instead of being sold to.
I was pleasantly surprised to see one of the outcomes of the 2009 sales conference in Miami where the buying cycle emerged as the new standard for funnel management. I trust this to be a stimulus for all the Perpetos customers bringing this into practice since 2005. But their is still a long way to go. It is indeed the best way to get subjectivity out of your funnel, yet it demands a mind-shift of the whole sales organisation and another way for management to coach and interact with their sales team. They all must learn to ask way more questions and ‘really’ try to understand what the customer is saying.
The principle is simple: Ask the customer questions which allows you to know the readiness to buy of each individual in the decision making unit (DMU), align them all so that they move through the buying cycle in a synchronised way and adapt your actions to it.
A couple of tips to improve your funnel management:
- Stop tracking and discussing sales steps and process. Start using readiness to buy phases based on reactions and answers to questions from each individual involved in the buying process. Ideally start using the Buying Clock. Using the time on the clock is an easy way for implementing a, consistent used, common language.
- Are we asking for and tracking the next step or are we engaging the sales rep to first decide on the next objective to facilitate the buying process on a project level before deciding what the next step should be, when and with whom? Do we track this in our funnel?
- Track the pain level of the customer by also knowing the impact of the challenges on the customer. Is their a compelling reason or an urgent need?
- Has your sales rep access to the decision maker? Is he continuously involved in the process and kept up to date by the sales rep?
- Is the go-live date the most important date we discuss with the customer? Is it a fixed date and why or can it easily be postponed? Do we know and are we tracking the go-live date?
- Has the customer actually confirmed your solution fit and did we postpone drafting the proposal until that moment?
- Split the weight % in 2 distinct ones: project%=what is the probability of the customer actually buying and win% = the probability of you winning the deal.
- Are you tracking the most important mandatory buying criteria and what is the perceived scoring of the customer compared to the competition? Do you discuss ways to influence these buying criteria?
Finally:
- Convert your weighted funnel in a scenario based funnel on which you coach the sales rep.
- Engage in vivid 1:1 discusions with sales to set a continuous improvement process in motion.
Your benefit and result: An accurate forecast with a highly improved visibility.
The basis of a good quality funnel is one which is based on prospect readiness to buy!
The most often used funnels nowadays are still based on subjective input from sales. It’s amazing to see how many managers are using such a funnel to predict revenue and use it as the basis for budget exercises. This is the funnel that most people use yet it is a very outdated model. This type of funnel is an artificial invention taking the eye away from the prospect and puts the focus on sales actions.
The fact that doing something is putting the opportunity on a given point in the funnel is a totally wrong assumption. The thinking is flood. You can give company and product presentations, demo’s, send proposals even when asked, etc without achieving anything. The question is am I doing something which corresponds with the readiness to buy?
Here are the biggest funnel mistakes:
- input based on subjective sales rep input. The gut feeling of sales people in terms of funnel management are seldom correct because:
- they are to closely involved to have an overall view
- most sales are to much influenced by the opinion of their ’sponsor’ and/or last sales action
- they have too little visibility on what’s happening at decision level
- not enough, if at all, contact with the ‘real’ decision makers
- individual forecast building by using a percentage win-rate on each of the opportunities. Most funnels at sales rep level and even on corporate level have to little opportunities at the same stage with too much variation in size
- defined by selling activities: performing activities is not necessarily moving the opportunity closer to a decision
- lack of common definitions
- imposed as a reporting tool and not as a day to day self-coaching tool: The funnel will never be up to date or based on careful thinking if it is not in a format, and incorporated in the way of working, which influences the agenda and behavior of the sales rep
- tracking and reviews based on must win deals resulting in starved pipelines and pushing salespeople to do the right things at the wrong time.
Helping management and the VP sales to more accurately predict the revenue is to convert the funnel into a buying funnel which tracks the readiness to buy of the opportunity. This is even more true in more complex sales with quit an amount of people involved in the decision taking. Because each of the involved people have their own agenda and readiness to buy which must be synchronized in order to move the opportunity closer to a decision in the quickest way possible.
The mental stages a buyer is going through:
These phases are universal and cultural independent.
- execution of existing solution and not interested in any information or offering in that area
- executuion and interested: something triggered the person to want to know more about something
- Field of Tension: Starts with an admitted pain which evolves over time into an urgent need. This results in the decision to buy something
- Market Research: The prospect goes out to the market to search for potential solutions and vendors
- Hesitation: This phase starts when the prospect thinks to be convinced to buy what from whom. At his point the focus shifts from looking to the benefits and advantages of acquiring the solution to all what can go wrong after having bought.
- Implementation: This is the period during which the solution is being implemented.
- Execution: The solution is in full use until the cycle starts all over again.
Perpetos has converted these phases into a 24 hour buying clock™.
Some of the reported results you acquire by this system are:
- a true shift towards customer focused thinking and acting
- an objective pipeline with a much better accuracy
- improved internal communication based on the hours of the clock
- lower cost of sales (i.e. less multiple people meetings because sales and pre-sales exactly determine when their presence is needed)
- improved hit rate
- more balanced pipeline
Let my know your experiences!
