Effective Customer / Prospect Profiling (Part 2)

Imagining Business Profiling Nirvana

Sing along …

  • Imagine all those salespeople selling all the time.
  • Imagine their pipeline that is constantly being topped up with fresh “sales ready” opportunities.
  • Imagine if real ROI is positive.
  • Imagine your salespeople could be held to account for focusing on the prospects and accounts you want them to focus on (not just the low hanging fruit).

Let’s be honest.  You can imagine all you want but unless you have and own the business intelligence (data) to know the makeup of your account and prospect base, you have no real chance of attaining any semblance of Nirvana.

Nirvana (or something close to it) requires a determination and a commitment to deploy resources to achieve it.  Above all it requires a salesforce that is disciplined to focus their efforts on those prospects and or accounts that you (i.e. management) want them focused on because that is where the business and sales growth is going to come from.

Why do you think the military places such an emphasis on good intelligence? How about the importance the US government places on it by spending trillions on the CIA and NSA?  Why does the Financial Industry spend billions on analysts to research the companies they want to invest in?  They do it because if there is any sure way to winning a battle it’s knowing the enemy, their resources, their location/s, their tactics and their operational plans.  

So why is it that when it comes to business, so few companies invest significantly in business intelligence.  Some do research gathering statistics for trend analysis but very little is invested in deep strategic data about targeted and strategic accounts and prospects.

Ask yourself …

  • How well documented is your database (CRM or other database system) with strategic information of your top accounts?
    • Do you know the names and contact details of the key stakeholders?
    • Do you know all relevant locations / geographies that the account operates in?
    • Do you know the potential account size (not historical value)?
      • How confident are you that part of your marginal accounts are not in fact LARGE accounts purchasing from a competitor?
        • If so which competitor?
    • How much do you know about adaptation and potential usage (or the number of installations)?
    • Do you know about growth (or contraction) plans?
    • Is the data accessible to all sales and marketing resources?

If the answer is “.. we know very little” then you have an opportunity to change that by engaging in a structured and ongoing information and business intelligence building effort that will give you a leg up on the competition and will enable your sales and marketing operations to be laser focused by maximizing sales and marketing productivity to increase sales.

See Part 1 of this article

Effective Customer / Prospect Profiling. How well do you know your customers and prospects?

Let’s be honest … 

  • Does your organization know all the important stakeholders (influencers and decision makers)?  In every location?
  • Do you know the potential account size (not historical value)?
    • How confident are you that part of your marginal accounts are not in fact LARGE accounts purchasing from a competitor?
      • If so which competitor?
  • How much do you know about adaptation and potential usage (or the number of installations)?
  • Do you know about growth (or contraction) plans?

OK you’re using a CRM.  And your sales people are supposedly entering some - if not all - of this data.  However, the vast majority of organizations that engage with us find it very difficult to encourage their CRM users to participate and engage in actively building comprehensive profiles.  Truth is, most CRM users generally put in as little data as possible - either because they are lazy,  or they are focused only on selling and don’t want to be bothered or it's because they prefer not to be accountable.  The latter is most often the case and management just lives with it.  

Additionally you may find that even your sales and account management assets know (very) little about your customer and prospects because they focus very narrowly on the easy short term opportunities where they believe that can get quick hits.  Good salespeople (generally) only focus their efforts on the 20% that potentially will produce 80% of their revenues.  However, when you dig around in the remaining 80% there will always be some large potential that is not known to sales at all.   

Information is power.  A salesperson’s mindset quite often is … “If I have the information and you want it, then I can leverage that to my advantage.”  And many salespeople do in fact just that, creating a situation whereby the salesperson is the lynchpin in your company's relationship with your customers and prospects.

If this is the case in your business then relationships with the customer or prospect base are going to be controlled almost entirely by the sales assets engaged in developing that prospect or managing the account.  

So who cares (one may say)?  “As long as they make their sales/quotas then I’m happy.”

True - as long as you’re aware of the potential consequences.  

  • What happens when the salesperson leaves?  Could you lose the lion's share of the investment in his or her sales opportunity pipeline?  Especially if he/she leaves for the competition?
  • What about the lost opportunity factor?  Is your salesperson maximizing the potential by investing in new and lucrative revenue streams?  Or cross or up selling?
  • And what about the company not having much ability to manage sales productivity?  Can you focus selling efforts on those prospects and or clients that you want them focused on - not only the low hanging fruit they prefer to sell to into?
    • Example:  You learn that a competitor is having issues.  Do you have any real time ability to reach into your CRM and identify those clients/prospects using that competitor and then focus sales efforts on turning these companies into your customers?

A company needs to manage its customer and prospect relationships.  The long term benefit gives it the ability to keep its finger on the pulse by controlling, managing and building client / prospect relationships positively and pro-actively.

And to do this the company needs to make sure that customer and prospect data is managed and kept up to date in your CRM system.  

How can you foster such a structure?

…we learned more about our market penetration and position in 6 months than we did in over 30 years of doing business.
— Client quote / Financial Institution

Profile building and helping companies and sales forces understand their customers and prospects better is complex and time consuming.  Generally it’s not in the sweet spot of activities for salespeople or inside sales and generally the major CRM systems require customization in order to store and effectively use the data.  

Let us know if you’d like learn more how profiling can impact sales and marketing productivity and help grow sales by allowing you to improve and manage relationships with both prospects and customers.

See part 2 of this article.

 

Outsource or “do it yourself” B2B lead generation?

Certainly, the ability to develop in house resources to match the ability of a specialist company like ourselves appears to offer more potential.  Typically, the thinking is based upon the assumption that doing it in house offers …

  • greater control
  • greater expertise
  • a methodology for training/identifying future sales resources
  • and other significant cost savings.  

In other words the prevailing thinking is ‘we can do it cheaper and better’ in house rather than outsourcing to a 3rd party specialist!

On the surface, that seems like a simple cost-effective decision, especially when comparing with an outsourced operation.  However, the practical issues are far more complex with the result that most in house attempts never achieve the desired objectives.  And it is this failure that in effect reduces sales instead of increasing your profits.

The fact is that most organizations don’t have systems in place to control and track and manage in house tele-services / tele-prospecting activities.  That’s especially true for startups.  Success in winning new customers is far more complex than simply having you insist on a certain number of calls per day and providing a basic database (CRM) into which the results can be recorded.  The need to actively manage personnel and the processes required are often overlooked.

Here are some of the required elements:

  • A systematic methodology for recruiting, hiring and training qualified people.
  • The more complex your subject matter and value proposition, the more difficult it will be to find the “right” people.  
    • Some considerations:
      • University Graduates?
      • Significant Business experience?
      • Familiarity with selling to and navigating complex (and large) corporations?
  • Complex products and services cannot be handled in a dialing for dollars mode using a script.  This means you need smart people who can engage in a consultative dialog, think and probe, listen and “peel away at the onion.”
  • Personnel management is an ongoing process because there will inevitably be turnover.  Meaning more effort recruiting, hiring and training (with lost opportunity cost during the ramp up period).  And that’s true even if a career path is established, because you’ll need to replace them when and if a promotion occurs.  These substantial indirect costs are often not considered when a company considers going down the in house path.
  • Making sure that your brand is being represented professionally
  • Rigorous quality assurance
  • Lead distribution and management
  • Record Management
  • Need to ensure that the notes related to the progress of each opportunity are sufficiently detailed to enable someone else to take over the record should the current business developer be replaced.  
  • Maintain focus:  Often the Business Development team, once in place, often gets sidetracked with other duties (administration, account management, customer service etc.).  Allowing this to occur dilutes the effectiveness of the entire effort as productivity drops dramatically.

So there is far more management time needed than is typically accommodated for.  And on top of having to provide systems and dedicated management resources, you’ll need to provide efficient and quiet workspaces and phone systems that will support phone-intensive activity.  Those costs are also usually overlooked.

To further complicate matters, because dedicated people are likely to be doing the same thing day in and day out, all day long, they are significantly less productive later in the day than earlier.  The smarter and more sophisticated the people you hire, the greater the likelihood that boredom will soon set in.  This inevitably leads to shorter tenure and higher churn rates.  And then there’s vacation and sick leave with the lost opportunity costs associated with those periods as well.  

At ETI we expect our productivity to be at least 100% more productive than that of a dedicated in house effort (deploying similar resources). Fact is on average we’re about about 200% more productive.

So, while on the surface it seems that doing it yourself may be better and cheaper it rarely works out that way.  Once you take all the direct + indirect costs into account - and measure this against the actual outcomes - insourcing is usually substantially higher than outsourcing.  And far less effective!


Client Quote:

"Over the years I’ve analyzed what it would take to duplicate what they provided for us with internal resources and we always came up short on our analysis. It was always more economical to leverage a relationship with ETI."



Lead Generation is about building Sales and Revenues. Not about fairness!

Companies often look at their sales force as if all reps were equal.  But of course this isn’t so.We appreciate the motivation of clients being fair insofar as the number and type of leads each rep should receive per week/month/year.  Sales and Marketing Managers frequently ask us about this all the time.

not-fair-logo.png

Experience has shown that acquiring new leads in certain geographies may be more difficult than in others.  This results in some reps being rewarded with fuller sales lead pipelines than others who receive less.

Within your salesforce you may also find some reps who are only interested in “ready to buy now” type leads.  They prefer not to be bothered with anything else (one could describe these reps as order takers).  Others may be hungry and are thankful for all the qualified leads they receive even those with lower qualification criteria.

You may also have salespeople who are more effective when selling to larger companies rather than smaller ones.  Some sales persons may be are successful selling into certain verticals.  Some may be better selling certain products/solutions only.

The more important question is what will it take to make your salesforce more productive (i.e. how to sell more in less time?) Treating everyone equally may actually hamstring the desired end result.  Customizing the leads  you deliver to your reps and focusing on their individual strengths will help to maximize their productivity.  They should also become more effective over time.

ETI Sales Support will work with each one of your salespersons to make sure they succeed with the leads they receive based on their individual needs and capabilities.

Customizing a strategy for each salesperson which focuses on his/her strengths increases the odds for each one’s success.  Naturally the more your reps succeed the more your company does to.

A win win for all!

Sales Leads are a Perishable Asset

How you manage leads makes the difference between a wasted investment and a solid return on investment!

Once your company spends money to find a prospect, the clock starts ticking; each inquiry has a life span.  Some of the leads may take a year to buy something, some may take six months, and some will only take a few months, or a few days.

We know that nearly half of any group of leads will buy; however, the perishable asset issue arises when leads are not followed-up promptly, or at all.  The facts (research) show that just because some sales leads are six months to a year old, half of any given group of leads with the same age is still in the market to buy.

As the great hockey player Wayne Gretzky said, “You miss 100% of the shots you don’t take.”   Companies are not immune from the same issue.  No (or slow) follow-up, no sale.

Far too many companies experience sales lead asset losses because their sales and marketing people do not follow up and contact prospects.  Sometimes it occurs because follow-up is slower than with their competitors or follow-up fails and the prospect doesn’t hear from the company at all.

Michael Falkson, CEO of eti Sales Support, said, “ETI's experience shows that 80% of inquiries that will convert into Market Qualified Leads will do so within 18 business hours.  Thereafter your chances of success will fall off dramatically“.

It makes sense to understand that buyers have a timeframe to buy.  Eventually they:

    • buy a product from you,
    • buy from your competitor,
    • decline to buy the product category (a different product entirely),
    • lose funding and don’t buy anything, or
    • never had an intention to buy in the first place (students, prisoners, competitors, etc.).

Regardless of the reason, the reality is that any group of leads from a given month has a life span.  Each month a few make a decision and disappear; they are dead to you.

However, how these inquiries are handled, contacted, qualified, and entered into the pipeline is vitally important. B2C marketers and salespeople know response to consumer inquiries is a race - - response times from inquiry to that first call from the lead holder can be down to less than a minute.

In B2B, response times are more often within an hour or two, or ‘same day’ for best of breed sales departments with inside salespeople.  Those who are asleep respond in days or weeks, and then wonder why the marketing isn’t working for them. The company’s investment in marketing is lost, and the potential asset has failed to buy.

Why it matters:

First, fast responders sell more than those who are slow, sluggish, unhurried, leisurely, and dawdling in pursuit of a prospect. In other words, those who take days  or weeks to contact a prospect.

In B2C and B2B, the best salespeople understand that faster is better and slower is also-ran.  The first person to speak to the inquirer creates an expectation level for others to follow.  The sales rep who is first to answer questions directs the conversation; he or she often becomes a “trusted advisor” and steers the inquirer to the features and benefits unique to their product and not so unique to competitive products. The subsequent delivery of pricing (a proposal?), literature, white papers, articles, case studies and other educational materials further cements the first responder in the leadership position.  Great first responders deliver pricing and answer questions the same day, before competitors make the first call.

Delayed response means a higher rejection rate. Prospects often ignore delayed responders as they no longer need information.  Plus, they see the delay as the first indication of the value of the business relationship: slow to respond, slow to deliver, slow to service.

Some leads may never mature for these ‘follow-up slow-pokes’ because budgets can be canceled, the inquirer changes jobs, the committee never meets, and what appeared so promising dies in a whimper.

Will You Be a First Responder or a Dawdling Responder?

The decision to be first is within your hands.  You can put the tools and the people in place to accomplish this within a few days; it’s a series of simple steps.

    1. Outline the sales stages required to make a sale.  Get agreement from salespeople.
    2. Outline the buying stages of the prospect.  Talk to customers.
    3. Meld items one and two as much as possible so that Sales is aware of and delivers information the prospect needs.  You now have the sales stages for the CRM system.  If the prospects expect pricing in the first call or proposals immediately, give it to them.  Read Zero-Time Selling by Andy Pauliii.
    4. Drive inquiries into a CRM and marketing automation system within a minute of the prospect submitting their form.  The CRM tool has to deliver the lead to Sales within your agreed-upon parameters.
    5. The marketing automation system swings into action and delivers information and content based on the buyer’s needs (form) or actions while on the site.   Many systems grade the inquiry by website actions, forms submitted, where they have been on a site and for how long.  Some new systems use machine or artificial intelligence to understand the buyer’s profile, accuracy of the address, email and phone numbers, previous buying history, etc.
    6. The inside sales department must jump into action as soon as the lead hits the CRM system and they are notified. This often means in less than a minute.
    7. If you do not have an inside sales or qualification department and the volume of leads is substantial, go to a qualified outside service. First responder service, qualification and nurturing are what they do. They make the call, pursue the prospect, and develop a lead into a qualified status or an immediate need.   They also nurture unqualified leads until they are sales ready, which frees up your salespeople’s time.
    8. Send the sales-ready leads to the salespeople.
    9. Eventually close out those names in the database that are not buying.

For B2B, certainly there is a fast, first responder requirement even if the inquirer takes weeks or months to make a decision.

Why It’s Important:

Leads that are followed up fast will buy at a higher rate. He who is a first responder sells more than he who is not.

The issue is that leads that are followed up fast will buy at a higher rate than those that are contacted within days or weeks, or sometimes even months after the initial contact.  He who is a first responder sells more than he who is not.

About the Author

James W. Obermayer is a four-time book author (two on the subject of sales lead management), is the founder of the Sales Lead Management Association; membership is free.  He is also the host of the weekly SLMA Radio Program.  In his spare time he is the principal of 20-year-old Sales Leakage Consulting, located in Washington State.

________________________________________________________

  1. James Obermayer, Managing Sales Leads: Turning Cold Prospects Into Hot Customers, (Mason, Ohio, Textere, an imprint of Thomson/South-Western, 2007), and Racom Books, Page 10
  2. James Obermayer, Managing Sales Leads: Turning Cold Prospects Into Hot Customers, (Mason, Ohio, Textere, an imprint of Thomson/South-Western, 2007), and Racom Books, Page 12
  3. Paul, Andy, Zero-Time Selling, Ten Essential Steps to Accelerate Every Company’s Sales, Morgan James Publishing, 2012

Be Smarter About Your Lead Qualification program

You have a fixed budget with little flexibility for expansion and want to develop a Lead Qualification effort to support your company's marketing inquiry generating activities (top of funnel) to maximize sales (force) productivity. Your choices:

  • Touch all inquiries by deploying a low cost agency and risk losing significant opportunities
  • Or ... Maximize Inquiry Conversions to HQLs (Highly Qualified Leads) i.e Optimize the budget to maximize ROI.

Let’s take a look.

Assumptions:

  • Annual budget of $200k
  • Monthly volume of inquiries (hand raises) - 2,000 from a variety of sources:
  • Inbound calls
  • Webform Posts
  • Whitepaper download
  • Email responses
  • Webinar attendance
  • etc.

Two agencies

  • Agency A: Best of Breed company
    • Higher cost  (See details below)
    • Agency B
      • Low cost
      • Possibly offshore

Let’s examine why what costs less might actually cost more.

roisimulation
roisimulation

Conclusion:

  • Agency A nets almost 100% more revenue that Agency B
  • Double the ROI

Note:  The variables and circumstances in your case may differ.  However, in my own experience a B type agency has never bested ETI (a best of breed company) on ROI.

Interested in evaluating your lead qualification program?  Or plugging your variables into this model? We’ll be more than happy to give you a fair analysis of how working with a Best of Breed company like ETI will impact your bottom line.  Please call 1.800.466.4ETI and we’ll be happy to provide an analysis of your existing program.

*Agency A

  • Best of Breed
  • Higher cost basis with greater deliverables
  • Smart well educated (university graduates)
  • Little - or no - significant churn
    • Stable Business Development staff
    • Onshore
    • Deep understanding (and experience) with business culture
    • Great familiarity navigating large enterprises
    • Very comfortable interacting with high level executives (C Level)
    • Not scripted
      • Approach is consultative
      • Results in identification of larger sales opportunities
      • Shorter sales cycles
      • State of the art technology platform to support the effort
      • Realtime visibility to all activities on your behalf
      • 24X7 Reporting Portal
      • CRM and Marketing Automation Platform integration
      • Promote and extend your brand

**Agency B:

  • Lower cost
  • Lower quality staffing usually referred to as “agents”
  • High staff churn
  • Frequent need to provision additional training
  • If product is complex (i.e. not a commodity) then is this agency capable of communicating your value proposition
  • Do not know how to navigate across large enterprises
  • Highly scripted
  • Not comfortable with consultative conversations
  • Limited technical capacity
  • Poor brand representation
  • Possible (irreparable) harm may be caused due to non-professional representation

*** MQL - Marketing Qualified Leads ****SQL - Sales Qualified Leads

Brand Can Affect Tele Prospecting Results by an Average of 30%

I recently conducted an analysis of work done for ETI clients since 2001 by categorizing them into 2 buckets … “Well Know Brands” (WKB’s) and “Lesser Known Brands” (LKB’s). We then evaluated the number of first calls which resulted in a substantive conversation with each prospect. Results showed that the WKB’s beat the LKB’s by some 30%. Moreover 25% more of these WKB records converted into opportunities than the LKB’s.

You might say it makes good sense that top Brands like American Express, Google or Motorola get more attention than XYZ No Name Brand.

Of course this makes sense. But one must bear in mind that top Brands spend millions if not billions building their brand equity. Smaller lesser known brands simply do not and cannot match these resources.

What actually happens in the real world is that many of the initial calls being made to prospects by LKB’s are actually Brand Building by their very nature. True there’s always some low hanging fruit, but successful Tele-Prospecting efforts relies on an interactive communication process to develop a trusted relationship.

Only when a prospect’s pain (or need or problem) is acknowledged and a level of trust has been attained - that an appointment could be setup for a sales person to become engaged.

So yes there is additional cost to the LKB in terms of the extra time needed to generate a lead. However, that investment is razor focused on the prospect company you want to do business with. It soon becomes evident that the LKB does not need to invest millions in media and brand building activity to achieve that. (In fact I’d hazard a guess that if you factored in the real cost per prospect touch of the WKB’s against the LKB’s you will find that the cost for LKB’s is substantially lower.)

That being said, one can also supplement go to market strategies with these low cost highly focused activities.

  • Be sure that you have relevant content for prospects who may request it.
    • A “send me an email” request may be regarded as a is a fob off, but as long as the prospect has a need and you are persistent, positive and professional in communicating with the prospect you will have an impact.
    • Also leverage Marketing Automation tools track content consumed on your web site or via promotional emails sent
    • Leverage contacts on social media (such as LinkedIn) to get entry to a prospect company through a recommendation?
    • A personal letter drafted by a professional copywriter can often be very effective.
    • Other activities such as PR, Trade Shows, Webinars can help but may also be costly.

Finally, remember that the only people who matter to your company are those you want as customers. Focusing your brand building activities exclusively on prospects can be effective and will lower your overall costs.

Recently I was interviewed on this subject by Jim Obermeyer of the Sales Lead Management Association. Click below to listen.

Giveback for Feedback Pilot Program - First Year’s Success

logo Closing the loop with Sales Reps is one of the biggest challenges facing companies engaged in sales lead generation programs. To assist ETI clients win more new customers and higher initial orders ETI launched (with a limited number of clients) our unique “Giveback for Feedback” test program last June.

With the clients’ cooperation to this end we extended an offer to each salesperson that in return for feedback on the leads assigned to them, ETI would make a contribution to their favorite selected charities.

I’m happy to report that success became evident in the first 6 months. The amount of feedback showing the back-end results was phenomenal and as - a result because of the great participation of the sales forces involved - ETI has already contributed over $2,000 to the nominated charities!

In most cases the feedback confirmed the quality of the leads being handed over, and in others the feedback highlighted some areas of possible improvement (which enabled ETI to immediately take pro-active action). Furthermore, the process has enabled us to build closer relationships with all the stakeholders involved.

Here is what one Sales Director wrote to his sales staff ...

“Hello,

I wanted to share with ALL of you in regards to the charitable contributions made by ETI based on your joint efforts in 2nd half of 2014. The gesture by ETI to offer donations to multiple charities is a testament to the quality of the group we have been working with for the past several months and no doubt has a special impact this time of year.

… Special thanks to those from the ETI Team!!

We are greatly appreciative of all the clients and sales staff that participated.”

Our target for 2015 is to generate a minimum of $10,000 for the charities as we roll and expand the program to all our clients.

If you would like to know how your company can benefit sooner from our “ Giveback for Feedback” program, please call 1-800-466-4384 and select option 1.

The New Sales Machine

A few months ago I read an article in the Harvard Business Review entitled ”Dismantling the Sales Machine” that I thought provided some vital insights into the ways in which the selling paradigm has shifted over the past 20 years. The proposition was that B2B sales leadership has always been fixated upon building a repeatable, sustainable process as the keys to success. These processes were accompanied by a myriad of KPIs and scorecards, qualifying criteria and activity metrics, all designed to paint a picture of sales productivity, process and results. Focus and discipline in this view of the world were the keys to success. B.A.N.T. was a required viewpoint.

If you could create one of these built-to-outlast-the-competition machines, if you could train the players, build a set of world-class tools (CRM, Marketing Automation, et al.) to support it, and create an environment in which the expectations were clear and the formal processes focused, you could win out.

But, as the article points out, buying behavior and stakeholder expectations have changed. Customers are far more empowered than ever. They now have the means to research what they need and craft an understanding of the solutions that are available independent of the technically trained sales rep. In a way, it disrupts the solution-selling paradigm before it gets off the ground. What’s left is to compete on the old sales paradigm of price or another of commoditized characteristic.

The article suggests that in order to compete successfully in the “new” environment, the sales rep needs to move from solutions to insights. If you can build a comprehensive understanding of the prospect companies needs, the solutions they have selected to meet those needs and, if you can identify the full array of stakeholders in the decision making process (all of those whose work is affected by the solution), you can contribute to their success by offering insights they may not have considered which would serve to disrupt and redirect the process, helping them to rethink their solution decision, thereby opening it up to you.

When we at ETI work with our clients to develop new business in their target market, engage consultatively with the key stakeholders and, ultimately, uncover qualified sales opportunities, we view a major part of our role as one of profile building on behalf of the sales rep. We’re the ones who are asking “how are you accomplishing these tasks now” and “what made you choose that path.” We follow up with questions like “to what degree are you satisfied with your current solution” and “if you could imagine making a change to improve your current solution, what changes would you envision.” It is probing at that level that gives the sales reps the foundation they need to craft relevant insights to engage prospects constructively.

The sales rep’s ability to deliver just the right insight at the right juncture in the process, and demonstrate how their solution can both meet the existing needs and achieve an improved solution, gives them the ability to compete in the new B2B sales environment. The challenge to sales leaders in this new environment is to move from thinking about sales as a linear process in which prospects move from stage to stage or in a direction down a funnel (or some variation of those sequences) into raising and leading a generation of sales reps who can think about business more creatively and bring more value and insight to prospect relationships than ever before.

Their success is now driven by their creativity and flexibility, not by their adherence to established process-oriented behavior. The rules and formal lines of authority in the new order shift dramatically and the incentives move from competition, contests and campaigns to creativity, collaboration and cooperation. Teamwork replaces individual achievement. And more sales are closed.

Is B2B Outbound Prospecting a Numbers Game?

Quite often, I hear: “Cold calling is a numbers game. When I was a salesperson, it took me X number of calls to get an appointment.” I suppose that’s possible, but I suspect that, most times, these anecdotes are not quite accurate.  For the most part, salespeople don’t keep accurate records and tend to forget quickly what actually happened. They tend to remember the happy accidents in which they called and uncovered what is typically known as “low-hanging fruit.”  It’s also rare (in my experience) to find salespeople who have actually made prospecting calls consistently, day in and day out.  And even if they did, they cherry picked the prospects.

Yes, many choose to think that tele-prospecting/cold calling/telemarketing is a numbers game.  The theory is if you make X number of calls, and speak to Y number of decision makers, you will get Z number of leads/appointments.

Nothing in life is quite that simple. Certainly not in the realm of complex B2B Sales Lead Generation.  If a “numbers game” exists at all in sales, it’s most often when there’s a commodity involved.

Consider some of the following variables:

  • Who are you calling?  (Who’s on your targeted prospect list?)
  • What’s the message?
    • Is there a compelling story?
    • Are you selling a commodity?
    • Are you just dialing for dollars?
    • How is your company/solution positioned in the marketplace?
      • If you’re selling a search solution, for instance, then it’s a lot easier to get someone’s attention if you’re calling from a brand leader (like Google) versus a company no one has ever heard of.
      • Who’s making the calls?
        • Good salespeople, for the most part, make poor telephone salespeople.
        • Are you employing a call center in the Philippines that has no comprehension of American Corporate culture and how to navigate its enterprises…or deploying inexperienced youngsters new to the workforce?
        • Do you know the name of the key contacts/decision makers?  And do you have good contact information – their personal telephone numbers (direct dials), email addresses, etc.?
        • Do you have a prior or existing business relationship (or not)?
        • Is your target list well defined?  If you’re selling ice from Florida to Eskimos in Alaska it doesn’t matter how many calls you make.  Maybe you’re selling a multimillion dollar solution to a smaller organization that may need your solution but definitely cannot afford it.
        •  Is this a blitz or part of a concerted, ongoing relationship and sales lead pipeline development effort?

Some factors that can impact conversion ratios:

  • Prospect lists – by as much as a 400% increase
  • Messaging – by about 100%
  • The quality of the Business Developer can have a marked impact.  I’ve seen results improved by several hundred percent.
  • Branding –  not so easily quantified, but it can have a significant impact.

Consider the following scenarios:

  1. One lead in 20 meaningful contacts (5% conversion), and each prospect is worth $10k;
  2. One lead in 100 meaningful contacts (1% conversion) – but this prospect is worth $10 million.

Which is potentially more lucrative?  You bet – scenario no. 2.  But that one also takes a lot more effort, time and investment.

So just looking at the number of calls, in and of itself, is not that useful a metric.  Ultimately the only key element that matters is $'s in the Pipeline, $'s generated – and at what cost.

One way evaluate an Outsourced Sales Support agency

2014-02-11_12-17-32One good way to evaluate the professionalism and stability of an outsourced B2B Sales Lead Generation/ Lead Qualification /Lead Nurturing service is the quality of their Business Development staff and their experience in engaging with the companies/prospects you wish to do business with. At ETI we’re proud of our Business Developer cohort:

Average tenure: 6.8 years Median tenure: 6.9 years

In a business where tenure is sometimes measured in weeks we’re pretty sure we have most companies beat.

 

 

 

Why good sales people should be terrible at prospecting

Here is a simple proposition: When a sales person is selling, he or she is not identifying new opportunities. And that’s a good thing, because you always want your sales people to be actively selling.

The better the sales person, the greater the imperative to focus his or her attention exclusively on selling. It’s not that great sales people can’t prospect successfully. It’s just that they simply shouldn’t have the bandwidth available to do the job well.

Consistent prospecting requires organized, dedicated contact with prospect companies, initially to identify the right stakeholders and then to engage with them, cultivate a relationship, and build an in-depth understanding of their needs, challenges and aspirations. That’s a full-time job; it can’t be done well on a catch-as-catch-can basis. It’s not a “one day a week reserved for prospecting” kind of task.

And, it’s no secret that most sales people hate prospecting. They often find it demotivating and foreign to their primary skill set. Good sales people get “pumped” when they are eye to eye with a prospect, deeply engaged in problem identification and solving, not when they are “smiling and dialing.”

Put them in front of the right people with an identified need and interest and they are smack in the middle of their ideal milieu, with their juices flowing. That’s when they can be most productive — cultivating the relationship, building a foundation of trust and closing the sale — and that’s exactly what you pay them for.

So, if your sales people aren’t engaged in prospecting, how do you get it done?

You can either develop your own, internal, dedicated business development team or you can outsource the activity to a company that specializes in lead generation. The choice is up to you, and it’s a function of how you want to deploy your resources. There are arguments to be made in support of either choice.

The key variables to consider include whether or not you want to take on the responsibility and overhead of hiring employees and the associated costs and, if you go down that path, whether you will then have the flexibility to ramp up and down as needed to meet your seasonal needs — not as easy with an in-house team.

There’s also the matter of lost opportunity costs associated with sick time, vacations and turnover. You pay an outsourced partner only for what they are doing, not for lost time. Along with turnover comes the need to hire and train regularly (it becomes a revolving door).

Then there are the costs of management, equipment and systems (all of which have their own associated indirect costs). Most often, in-house solutions are more costly than outsourcing if you account for all direct, indirect, and lost opportunity costs.

But you may want to spend more to gain greater control, and owning the process internally certainly gives you that. Moreover, it's easier to facilitate communication and teamwork between your own employees than it is if you use an outsourced partner. And that's an important consideration.

And let’s not forget your brand and the image that is portrayed by those who are representing you to your prospect (and customer) base. Whether the solution is in-house or outsourced, that’s a critical variable that is too often overlooked. The cost of a bad connection between one of your representatives and a prospect or client is huge. You can’t overestimate the importance of professionalism and brand and product image.

So, whatever route you choose, be sure that your representation is professional enough to raise the esteem of your brand as well as accomplish the primary goal of generating qualified sales opportunities Ensure that your management structure is sufficient to mandate accountability from everyone involved, from those responsible for seeking out the opportunities to the sales people who must follow up if your investment is to have solid ROI.

Regardless of your choice, the lesson here is simple. Sales people are among your most expensive assets. Employing them to undertake work that can be more consistently and productively accomplished by a competent, dedicated prospecting team is both far more expensive and unproductive. Keeping them in front of the right people as often as possible is the best way to maximize their productivity as well as the return on your investment.

Problems vs. Needs

Recently I spent some time watching a presentation (actually it’s a detailed course) by Steve Blank a seasoned Silicon Valley entrepreneur entitled “How to Build a Startup”. And for anyone starting a business or is involved in a startup this is highly recommended. Part of the course deals with the concept of “Pain Killers” where he elaborates on the difference between Problems and Needs. For someone in the B2B Lead Generation business, the identification of Problems, Needs, and Pain that prospects are experiencing provides us with an opportunity to explore those pains in greater detail and, perhaps engage the prospect in exploring the solutions our clients offer. So understanding the difference can be critical.

How does Blank define Problems and Needs?

“... it's kind of interesting to differentiate between solving a problem or if somebody who has an accounting problem or a word processor or they can now use Google docs versus Microsoft Word versus a need. “ “What's a need? Well, a need might be a need to be entertained or a need to communicate. Needs are something that are universal across all 7 billion people on the planet. Your total available market plus or minus a couple of billion. Maybe kids 0-5 don't have those needs but eventually you will find market sizes for needs to be multiples by orders of magnitude above solving problems. And so, I'm not suggesting that you don't solve problems. I'm not suggesting that you try to turn every problem into a need. But let me suggest the one company in the 21st century that did this better than anybody else in the planet was Apple and the iPhone. They took a communications device and made it a status symbol, and they transitioned from a product that solved a problem, integrated web browser, e-mail, and phone into something that people now every year obsolete their own products by wanting to get the next one because it's now a need rather than a product.”

The takeaway? Generally problem-solving while important, is often both short-term and one-off. Being able to identify the nascent human needs that will drive demand for your solution (as Apple meets the need for status, entertainment, communication and simplicity), coupled with the ability to satisfy one or more of those needs, will produce a stronger, longer-term relationship, assuming your product or solution continues to satisfy the need.

Generally companies look to solve problems other businesses have. If they could deliver more comprehensive solutions to solve needs (vs. problems) then a deeper and longer relationship will ensue.

Turning Nightmares into Sales

The number one challenge for a sales person is overcoming inertia. Every sales person knows this well. Far more often than losing a sale to the competition, you lose to a non-decision, essentially a default to maintain the status quo. In all likelihood, it’s not that you weren’t able to convey your value proposition or demonstrate the potential ROI of substituting your solution for their existing practices. It’s simply a matter of prospects having to confront the often irrational fear of abandoning what they have been doing up until now, that has been failing them, to adopt a new process that has the prospect of being far better. Change is that scary and inertia is that powerful.

Inertia, and the irrational fear of change, can and has caused companies to fail. Ironically, inertia is often more powerful in the most critical situations in which the problems have existed for a long time. What else could explain the delay by an otherwise smart and rational business person to identify and implement a solution with far greater potential to resolve the problems before things reach a critical stage?

Compare it, if you will, to an individual with a phobia. According to the American Psychiatric Association, a phobia is defined as an irrational and excessive fear of an object or situation. In most cases, the phobia involves a sense of endangerment or a fear of harm. Phobias strike very smart people as often as people who are less intellectually gifted. It is intelligence neutral so to speak.

One of the most successful approaches to treating phobias is by the use of guided imagery, in which patients are systematically desensitized to the object of their fears by visualizing situations in which they can calmly and safely coexist with the object of their fears.

So how does that inform the sales process, especially as it relates to the fear of change?

When you are presenting your value proposition, after having assessed and diagnosed their needs and crafted a solution, it will help if you are able to give them a meaningful opportunity to visualize life after the change is implemented. Help them imagine how they will feel about the success of adopting a new and improved solution. Let them dwell on that. Indeed, encourage that actively.

Encourage them to be active participants in that endeavor. It’s just like the beer commercial where you see two (or more) attractive people sitting on a lounge chair on the beach with a slice of lime hanging off the rim of their beer bottles listening to the waves crashing on the shore.

Ask them... literally ask them ... to picture themselves in the absence of the problems caused by their current practices (or their lack of an adequate solution). How would that free them up to deal with more important issues? How would other people regard them in the light of that success? How would they feel if they had a solution that will enable them to sleep at night unfettered by the challenges they are facing now?

By helping the prospect imagine and embrace a positive outcome - instead of being haunted by the nightmare of what catastrophe change might cause - you will give them a path to embracing change instead of fearing it. It’s as if you could give a claustrophobic locked in a closet the power to imagine that the door is transparent or invisible.

Most Sales People Still Don’t Get It

Recently my wife and I went out to buy a washing machine. We really had no choice and couldn’t wait. The old one broke after 20 years. The need was imperative. So we went through the very same experience that virtually every buyer goes through as we shopped for exactly the right appliance to meet our needs. Ultimately, with alot of research and effort. we were able to find a product that met our needs at a value that made sense for us.

But virtually all of the sales people we spoke with were absolutely useless and, as a result, failed to gain our sale.

Let me describe our experience. It will ring familiar. And they were serial experiences in several showrooms, so it wasn’t simply one bad dealer. It was almost universal.

We walk into the appliance showroom. We are ignored for a while as we wander around looking at various appliances. Maybe their sales manager taught them to do that on purpose. It was certainly a universal experience.

Ultimately, a sales rep comes up and asks, “Can I help you?”

“We’re interested in a washing machine”, we say.

What comes next?

“Let me show you the models we have.” “This one has the fastest spin cycle in the industry.” “This one is the most energy efficient washer on the planet.” “This one is best on gentle fabrics, and this one.....”

Not once did any of them ask us simple, relationship building, helpful, guiding questions like...

  • Do you already have a washing machine?
  • What kind?
  • How long have you had it?
  • What did you like about it?
  • Why are you looking to replace it now?
  • How important to you is replacing it immediately?
  • How frequently is it used?
  • How big is your family (kids)?
  • Do your kids play sports or get very dirty?
  • Do you wash your dress shirts or send them to the cleaners?
  • How is it used (colors/whites/shirts/heavy dirt)?
  • How important to you is energy efficiency?

How much were you looking to spend? (Well this one they do ask, but way down the road)

You get the drift.

If they simply took the time to ask us these questions BEFORE they overhelm us with 30 different makes and models, most of which we have no interest in, they could close the sale in a flash. We could have saved hours of comparison research, and they would have gained a loyal, long-term appliance customer.

But, no. They chose reflexively to inundate us with a never-ending list of features and benefits,presumably as a way of differentiating each product. Wow! It felt like it went on for a mind-numbing lifetime.

Of course, that robotic approach lead to the inevitable ending that every salesperson has heard, in one form or another more than once until, of course, they gain the requisite insight to mitigate it: “Do you have any brochures? We’d like to review them, think about it, and get back to you.”

By the way, we also went car shopping. That was even more fun.

When will they ever learn?

What’s eti’s “secret sauce?”

If you're curious ....

  • What makes eti’s solution so special?
  • Why can’t I do it in-house (better and or cheaper)?
  • Why is eti’s solution better than the competition?
  • What is eti’s “secret sauce”?

    We thought we’d share a list of some of the key ingredients that go into making eti’s solution extraordinary in a new article posted on the ETI site.

Building Trust and Being Authentic is Critical in Sales

I recently read a Management Tip of the Day from Harvard Business Review that said: “When working in a foreign setting with different norms and rules, you're likely to make cultural mistakes. But you can lessen their impact by engendering people's trust in the first place. Make sure your foreign counterparts believe you care enough to try to learn about their culture, even if you haven't fully mastered the rules. Work hard to show genuine interest, curiosity, and respect.

But, you also need to be authentic. Don't fake an interest in Indian food, for example, if you could care less about culinary arts. Find a pursuit that genuinely appeals to you and explore that. Otherwise, it will be clear to your colleagues that you're trying to ingratiate yourself, not learn about the ins and outs of their culture.”

This advice applies equally to all aspects of client relationships. If you can’t build an honest and trusting relationship with a prospect or a client, you will never be able to take the relationship to where it creates the win-win needed for all to benefit.

Think about the process for prospecting or selling (up-selling or cross-selling too). You may have a better solution for your client or prospect, but they won’t be amenable to hearing about it unless and until they feel the trust and respect from you that warrants their attention.

And trust is based, quite substantially, on honesty. That means you need to tell the truth. If your solution isn’t the best one to meet the prospect’s needs, they need to hear that from you first. Tell them why you think that’s the case and give them the very same advice you’d give your best friend, even if you don’t benefit directly.

You may lose the sale as a result, but you will have gained the ongoing trust that will ultimately earn you far more business, from either that prospect or client or someone they refer you to. That kind of approach takes courage and it’s very different from the “sell at all costs / sell ice to Eskimos” traditional selling story.

But, in the long term, both you and your company will benefit from this approach.

Bells & Whistles vs Need, Pain & Interest

I got a call yesterday from a young inside sales rep who works for a company that specializes in automated tools to assist the inside sales process. The call resulted in one of those rare win-win-win outcomes, although he might not see it quite that way. Let me explain.

He introduced himself by saying something about some vague connection between me and the CEO of his company, implying that somehow he and I had spoken or communicated or knew one another. I don’t think so.

More likely, he was responding to my click on a broadcast email I had received earlier in the day from his company inviting me to an all day web conference on the topic of inside sales. Although I had an interest in the topic, my schedule precluded my attending, so I was just poking around to see what I might have missed.

Other than raising my suspicion with his introduction, the young man was otherwise quite articulate and seemingly knowledgeable about his company’s product line. He explained that he had done some research on our company and had determined that they could help us because their products focused on assisting companies with inside sales and lead generation missions by providing automation tools to enhance productivity.

He then asked if we had a CRM (I suppose if I said we didn’t, he’d offer to sell me some very large index card cabinets). I explained we ran a very robust, proprietary application on an Oracle platform that basically ran our entire business as well as providing ourselves and our clients with web-based CRM capabilities.

Without skipping a beat, he launched into a discourse about some of their products and how they could help us do everything short of creating world peace and climate control. Very impressive promises, indeed.

What he forgot to do was to earn my trust. He never asked me about how we use our CRM, what were its capabilities and perceived shortcomings, or what, if anything, we’d love to have that we didn’t already have. What made him think we needed his magic tools?

So he never really earned the right to move to the next level of relationship building. He turned the conversation on a dime from me and us, to him and them, without giving me a chance to tell him more about what we do or might need.

When I told him that the promised bells and whistles had strained my sense of credibility, he offered to connect me with a subject matter expert who would explain how it worked and why they could do what he promised they could do.

Suffice it to say that he had lost me.

Faced with his offer, I was left with two options. I could tell him I wasn’t interested and hang up, or I could ask for him to email me some information so I could think about it more before wasting my time and that of his subject matter expert. After a little push back, that’s what he did.

The material he sent was basically a link to a video presentation by a sales manager about their Salesforce.com solution. It was nicely done. However, because our application also integrates with Salesforce.com, the presentation had little value. And although there were some slick features included, most of these are already have been embedded in our application for many years.

The real win for me was in getting an idea from their presentation about how we might present calling information in our application that might make it more useful. Neat, easy to do, and a contribution that made my time on the call worthwhile for us.

But at the outset I promised that it was a win-win-win outcome. Where are the other two wins? Here they are.

The win for him was the fact that I was not, and would likely never be, a qualified prospect for his company’s Salesforce.com tools. Had I agreed to speak with a subject matter expert, he would have recorded this as a positive outcome in his records when, in fact, it wasn’t. A false positive is not a real positive.

The subject matter expert also got a win -- by saving his own time and not making a presentation to an unqualified prospect without any potential whatsoever to make a purchase. By saying no to the invitation to meet I had enhanced his sales productivity.

So that was the win-win-win outcome I promised, but what is the real takeaway here?

If you are going to initiate a meaningful relationship with a prospect, new or otherwise, you need to do more than satisfy yourself that they are a suspect. You need to earn their trust by probing to understand their needs, challenges, interests and aspirations. What keeps them up at night?

Bells and whistles are interesting to present, but they are all about you. And prospects have no reason to care at all about you. Qualifying a prospect requires an in-depth understanding of them, because it’s always all about them (as it should be). You don’t earn the right to speak about yourself until they have finished speaking about themselves and you have something to offer that will help them meet their needs, achieve their goals, resolve their challenges, or sleep better at night.

The Seasonality of Lead Generation

Summer

About this time of year, every year, we get questions about the effectiveness of Lead Generation in the summer months. The thinking is that summer is a slow time where decision makers are away and generally things slow down. That’s true - to a very limited extent. To clarify the situation for ourselves and our clients we decided to analyze the results we achieved in the summer months measured against results from the rest of the year - over the last 20 years.

The projects we reviewed showed conversion rates which ranged from well over 30% to as little as 3%. The results indicated that conversion rates in the summer months were practically the same. In other words the research revealed that seasonality made no practical difference to results achieved

  • Summer months conversion ratio - 13.51%
  • All other months - 13.37%

We also wished to know whether the amount of effort (hours worked) required more hours worked in the summer months compared with the rest of the year.

Actually not. Using the same 20 year period we found that on average the exact same number of hours per lead is required when comparing summer months to all other months.

What accounts for this? We believe that the primary reason is that while fewer decision makers are accessible in the summer, there are also fewer obstacles in getting through to them. Buyers appear to be more relaxed and more amenable to engage in meaningful discussion.

Is it different over the Christmas holiday period? Nope. Pretty much the same.

So in terms of B2B Lead Generation we can definitively state that results do not vary seasonally (unless of course your business is inherently seasonal.)

How Good is Your Sales Execution?

We have a valued client company that is expert in what they term “Retail Execution Solutions”. In essence, they enable large retailers to “have the right product in the right place at the right time.” While they do have some very powerful proprietary solutions, very few of the specific services they provide are truly unique. In fact, virtually every retailer is already conducting the standard activities that our client provides as services. They include inventory, space planning, shrinkage and supply chain audits and a program for site design and organization. Retailers may not be doing each of these activities as efficiently or effectively and cohesively as our client would, but these are all essential business practices that every retail operation must conduct to stay alive.

The unique aspect that our client brings is a highly systematic, integrated approach that enables them to link all of those disparate, essential activities, giving them the power to bring the results to bear on the full scope of their operations. Hence, the term “Retail Execution.” As I said before, it gives them the ability to “have the right product in the right place at the right time.”

As I was thinking about all of this, it dawned on me that what our client provides to retailers is analogous to what we provide to our clients. We provide “Sales Execution Solutions.”

Surely every company we work with is already doing the basics: generating leads, perhaps even pre-qualifying them, they have sales forces and, especially nowadays, they may have access to some kind of CRM to track their leads and sales activities.

They might want or need more leads, or better qualified leads. Or they may need help managing their database and tracking their prospects, leads and sales activities. And they may need to better understand their market or ways to develop new markets or bring new products to market. But the basics elements are there in order for them to survive.

So where does Sales Execution come into play? In the very same way our client supports their retailers: our deliverable is in providing clients with a systematic, repeatable, successful closed-loop process for growing revenue, developing and managing new business opportunities and targeting their marketing investment on vehicles that have the best potential for revenue growth and the successful development of their company.

By engaging with a company that focuses on Sales Execution (or enhancing sales productivity), you are focusing your sales resources precisely on those qualified prospects and customers that are ready to make a purchase decision in the near term (“the right contact in the right prospect company at the right time”).

There are many companies that can provide pieces of this kind of solution on an outsourced basis, some at a far lower cost than managing it internally. But the real trick is in creating an environment in which all of the pieces of the business development puzzle can work together, seamlessly, and one in which they augment one another to create true, powerful sales execution.

So, while “Retail Execution” enables a retail company to have the right product in the right place at the right time, “Sales Execution” enables a company to put their sales people in front of the right prospects at the right company at the right time.

I’d love your comments and questions.

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