Is there such a thing as Sales and Marketing Harmony?

Some say they have accomplished it, but they infrequently share how (if they really know how).  Many marketers say that sales and marketing harmony is an oxymoron.  Salespeople refuse to think anyone can produce sales but them. We know that those that achieve S&M harmony are said to perform wondrous deeds in the name of revenue.  In this CRM Radio interview with Giles House of Callidus Cloud, we tackle sales and marketing harmony building. The CRM Radio host is Jim Obermayer.

 

About the Guest Giles House - SVP and CMO of Callidus Cloud  

 

Mr. House is an experienced marketing executive with a proven track record of successfully marketing and selling business software and technology. At CallidusCloud he is responsible for the company’s global marketing activities, communications, product strategy, brand and sales enablement programs.  As a thought leader, House regularly speaks on sales and marketing, and has been interviewed by leading publications such as Inc., VentureBeat, MarTech Advisor and CRM Magazine.

 

About CallidusCloud

 

CallidusCloud is the global leader in cloud-based sales, marketing, learning, and customer experience solutions. It enables organizations to accelerate and maximize their lead to money process with a complete suite of solutions that identify the right leads, ensure proper territory and quota distribution, enable sales forces, automate configure price quote, and streamline sales compensation — driving bigger deals, faster. Over 5,000 organizations, across all industries, rely on CallidusCloud. 

 

About CRM Radio

 

CRM Radio is a weekly live internet radio program on the Funnel Radio Channel.  It is broadcast at 11 AM Pacific time GMT +6. 

How Voice to Text and Artificial Intelligence might help in Business Development / Sales

ETI has always been on the cutting edge of integrating and innovating the use of technology in our sales support and lead pipeline development operations.

With this in mind we continue to explore what applications might ETI deploy to maximize the abilities of its Business Developers (BD’s) as they engage in conversations with clients’ prospects to identify sales lead opportunities.

At ETI our approach to guiding business development conversations is to provide BD’s with a series of prompts (call guides) - many times consisting of profiling and sales lead qualifying questions that motivates prospects to open up and engage in a conversation about their business, their needs, their pain and problems as well as current solutions (if any) used.   

So letting our minds wander we started thinking about if we could provide an additional information layer to the BD - as the conversation progresses - by (machine) listening - in real time - for keywords or phrases and then using artificial intelligence to popup related information or prompts to help guide the conversation more effectively?

For example:

  • Prompt/suggest the BD with follow up questions
  • Display competitive information with how our client’s solution could deliver better results
  • Popup relevant content giving the BD a better way to respond to certain questions and or objections
  • When a question is asked (maybe a technical one) our BD can have real time access on how to respond; we can offer either additional ideas - or better still - because technical questions are often times buying signals we can arrange for an expert (or salesperson) to follow up and answer the question and move the conversation forward
  • And this is just the tip of the iceberg

Exciting stuff.

Rest assured we’re already working on and developing just such solutions.

Stay tuned.

Criteria for Insourcing vs. Outsourcing Business Development

I have written extensively over the years as to why and when it makes sense to outsource business development primarily for economic reasons.  

That being said, when a company is considering business development to create a systematic and sustainable lead pipeline building process one must consider a number of criteria (not only cost).  

 

Let’s consider some of the issues:

Criteria

Insource

Outsource

Headcount

Will require allocation of resources and overhead.

Draws on Human Resources investments and resources.

Headcount will not need to be increased,

In fact you may gain an opportunity to reduce current headcount or overhead.  

No Human Resources overhead required.

Retention / Churn

Business Development staff are often looked on as entry level for Sales jobs. If so they are not hiring people with the right abilities (for business development) as sales requires different skills.

Hiring the wrong people will increase turnover and lower success potential for the insourced operation while at the same time incurring additional costs.

The provider is responsible for providing qualified and professional staff.

At ETI our staff retention record is second to none and the median tenure of an ETI Business Developer - will for the most part - be longer than of an insourced Business Developer.

Control

Everything done under your roof.  They are your employees and they are assigned to focus on your business only.

Perception is better quality personnel and management.

Perception is that you have less direct control as it is not under your roof.  However in reality you exert substantially more control - for example the ability to ramp and and down, messaging control, real time production levels and results monitoring etc.

In ETI’s case we provide as a deliverable complete transparency (far more than would normally be available inhouse).

Focus

Inevitably an insourced operation (in our experience) is rarely 100% focused on the business development task ahead.  Over time priorities change and in many cases general administration and account management activities creep in.

100% focused on the business development task at hand.

Fully accountable for results.

Productivity

Insourced operations are rarely as productive as outsourced ones.  

Result:  Lower throughput of leads into the Sales Opportunity Pipeline.

Generally speaking productivity levels in real terms of an insourced operation will be about 50% of the outsourced company meaning that to fill your sales opportunity pipeline you will require about 2X the staff levels just to match the outsourced solutions throughput.  (See our prior blog on this subject.)

At ETI, whatever the model (Hours / Pay for Performance or Hybrid) you get 100% for your investment.   

Product knowledge and expertise / Brand Representation

Insourced should be better with more invested in training and access to information.

However, if the business development task is to identify new business opportunities - i.e not sell or close the sale - then engaging in highly technical discussions when the need it to build interest and awareness, might be a minus not a plus,

Conversations should be focused on need/pain current solutions etc.

Conversations should be consultative … not sales or product oriented.

Focus is entirely on identifying in qualifying and quantifying potential.

In reality since ETI’s BD’s generally have longer tenure than insourced, they often have a better understanding of your solutions as well as the the applications within the target markets being called.

Hand off is only done once relevant criteria meets this requirement.

Management Expertise

Management expertise in Business Development is rarely available insourced - and if there it is usually focused on other activities.

Acquiring such expertise or reassigning internal management is costly and disruptive.

Extensive experience and expertise.

In ETI’s case it’s management team is unsurpassed having decades of experience in “making it happen”.

Generally speaking insourced operations cannot deliver the extensive experience of the outsourced solution provider.

CRM

Most companies today have a CRM.  However, few CRM’s (if any) are built to maximize Business Development productivity.

However, to optimize and drive the internal operation you will usually need additional licensing costs and the training and or consulting fees that go with that.

If you stay with the CRM as is, your productivity levels and the ability of management to effectively manage the activity will be significantly compromised.

In ETI’s case we have a CRM (i*Collaborator) built entirely to manage the Business Development process.  Even third party systems that “bolt on” too traditional CRM’s cannot match our state system.

Furthermore, ETI offers services to leverage traditional CRM API’s to push and pull data seamlessly giving you the best of both words.

ETI has also developed its own tools to allow its staff to operate in your own instance of Salesforce.com while leveraging ETI’s CRM to maximize productivity and efficiency.

Technology

Although the technology components today are largely commoditized (and relatively lower cost) an effective insourced operation must have the following capabilities.

  • Monitor live
  • Record calls
  • Mentor live
  • ACD

Some older systems do not have these capabilities and may require additional purchases/licenses.

Any outsourced operation worth its salt should have a state of the art PBX and or technology platform delivering all the functionality required.

Suffice it to say that the notion that cost and the perceived improved internal controls and quality of staff is often not true.  When comparing apples to apples you may well find that an outsourced solution (or an outsourced supplemental team) can more than match an internal effort both in terms of costs, results, brand delivery and the overall productivity of your sales effort.

 

How Effectively Are You Managing Your Valuable Leads?

Know Your Cost of Leads

Do you know how much it costs your company to generate profitable sales leads? The emphasis here is on profitable - because not all sales leads are profitable. Nor do they each cost the same. However, they represent good money you’ve spent to buy more sales opportunities for your sales force. 

Of course not all sales leads are born equal. They come in many shapes and sizes. From advertising, trade shows, seminars, direct mail, email promotions, teleprospecting and other promotions. Each lead costs you, and someone in your organization is comparing cost with revenue generated.

Effective Lead Qualification Essential

Generating an inquiry is of course the first step. The purpose of lead qualification is to turn them into prospects. And prospects into customers – hopefully lifelong customers.

All leads (at some point) must be qualified whether we like it or not. The sooner the better!  More often than not the most effective way is to outsource to an experienced sales support agency with a history of sales qualification success.  Why?  Because it’s unlikely you will develop an in house resource staffed with a dedicated and professional Business Development Team of the highest caliber that are focused entirely on the lead qualification process.  If you have (or create) an in-house resource to do this then your actual operational costs will be higher and profitability therefore will be lower.  

Some companies believe they can avoid the cost of qualification by turning the leads over to individual salespersons (or in some cases to the salespeople of their Channel Partners). A more effective solution is to pre-qualify and only have a salesperson engage once the potential exists for a sale. The salesperson - whose time is far more costly - can then focus his or her time entirely on the job of selling.  

Impact on sales force sales productivity can be as high as 400% when a salesforce is focused entirely on pre-qualified leads!

Leverage your CRM - Require feedback from your Salesforce

While many opportunities require immediate follow through (and the sooner the better!) others require multiple follow ups over an extended period of time before they mature. Salespersons without the support structure (i.e. a functioning and workable CRM) to manage and control future sales appointments may permit many of these qualified opportunities to gather dust and die.   On the other hand few companies who have CRM’s actually leverage them to maximize sales force productivity (a subject covered in other articles and blogs on the ETI site)!

Are you in control?

  • Do you know exactly, at any time, what happened to each sales lead you distributed ? To every salesperson or salesforce, VAR, channel partner, distributor? To every office in the U.S.? Worldwide? Last month? Last quarter? Last Year? Year before?
  • Do you know exactly how much each sales lead cost?
    • Per ad source?
    • Per VAR?
    • Per distributor?
    • Per salesperson?
    • Per area?
    • Do you know exactly how much sales volume each sales lead or source produced?
    • Which source generated the greatest number of sales? Per ad? Per month, season, period? Highest to lowest?
    • How much you profited?
    • Do you know which VAR, distributor, salesperson, is most efficient in terms of number of sales leads converted? Over any period? Highest to lowest?

Feedback, Feedback, Feedback

Feedback is the crucial element to successful lead management and tracking. Yet there are many salespersons, both in your direct and indirect sales forces who don’t understand the importance of disciplined feedback. As a result, they don’t provide the necessary status or progress reports on each sales lead for which they are responsible.

The consequence of this is that no CRM or equivalent will work for you. An exceedingly high price for a company to bear. Leads are the lifeblood of business. And since you’ve already incurred the high cost of generating and qualifying the leads, it is intolerable to lose the immediate and future business they represent. And you lose the rewards of lifetime sales. Worse, you aid the competition.

Are Inside Sales Departments good at Lead Generation/Lead Qualification?

Should you consider outsourcing to complement Inside Sales?

ETI clients often have Inside Sales (IS) departments.  

Typically Inside Sales are tasked with a range of responsibilities including (but not limited to) Supporting Field Sales, Customer Service, Account Management, Order handling and Processing as well as some Lead Generation, Lead Qualification and Lead Nurturing.  In some instances they also play a role in building and maintaining Partner relationships.  

IS reps are for the most part involved in passive activities such as responding to the needs of accounts and supporting field sales.  

When most managers spec out the job requirements for their IS staff you will find Lead Generation/ Lead Qualification high up on the list of requirements.  Yet, proactive Lead Generation and Lead Qualification somehow gravitates over a period of time to become a small(er) part of their actual activities.  

Now let’s define the typical traits of the IS staff:

  • Hunters are great at identifying and either bringing in new business - or at least generating and qualifying leads.

  • Farmers’ strength lies in nurturing and helping grow existing accounts.  In addition they frequently function in a ‘customer service’ role.

  • Gatherers’ wait for the low hanging fruit to fall into their lap.  

Rarely are IS reps highly effective at all aspects of Hunting, Farming and Gathering.  Most are more often excellent at the latter two with only a small percentage having the strength to undertake the grueling work of Hunters.  

Now let’s consider the traits of the personnel needed for the various types of Inside Sales activities:

   Traits
    Hunter Farmer Gatherer
A
c
t
i
v
i
v
t
i
e
s
Account Management Not a Match Good Match Not a Match
Customer Service Not a Match Good Match Good Match
Lead Generation Good Match Not a Match Not a Match
Lead Qualification Good Match Somewhat of a Match Good Match
Lead Nurturing Not a Match Good Match Somewhat of a Match

Another consideration is the IS Management Team.  It’s safe to assume that the team they build will be around their core competencies.  If their competency is in Customer Service and Account Management and not in Lead Generation then you will probably not have a department that is meeting its Lead Generation / Lead Qualification goals.  

It is rare to find an IS operation that is good at everything.  It is even more rare that it will be staffed with adequate resources to fit all its requirements.  

  • If you need it all then consider allowing the IS team to focus on a specific core competency - rather than trying to be all things to all people.  You can then outsource the missing elements to a company that has those core competencies and that can deliver results in quick order.  This can result in a major positive impact on your ROI.

At ETI we’ve had unparalleled success working with Inside Sales departments to maximize their productivity by providing the solutions they need to maximize their resources including all of the above activities.

We’d be happy to engage with you and explore how ETI, might compliment  your IS department.   Please call 1.800.466.4384 - select option 1.

Will the chatbots take over B2B Sales Lead Generation?

There’s been a whole lot of press lately about the next big thing in tech being the rise of the chatbots.

First for the uninitiated a little definition about bots from Webopedia.

Short for chat robot, a computer program that simulates human conversation, or chat, through artificial intelligence. Typically, a chat bot will communicate with a real person, but applications are being developed in which two chat bots can communicate with each other. Chat bots are used in applications such as e-commerce customer service, call centers and Internet gaming. Chat bots used for these purposes are typically limited to conversations regarding a specialized purpose and not for the entire range of human communication.

Probably the most common known bots today are Apple’s Siri,  Amazon’s Echo and there is Microsoft’s Cortana and so on.  The question for us in the B2B lead generation space is - could we eventually envision a world where instead of a human engaging in a sales discussion with a prospect, might it be possible for a chatbot to do this instead.

The ramifications are potentially substantial should there come a day when human interaction in sales situations will become marginal to obsolete.

Im my opinion: I think the adoption of chatbots will be quick.  The potential productivity gains and savings make it inevitable.  Especially for commoditized products and services.

Already apps or programs are being written for chatbots to interact with all types of online businesses.  For example in the food business where instead of ordering online you might soon be able to use your Facebook Messenger, or Twitter account to order a delivery of Pizza or pre-ordering your pickup from Taco Bell.  Why would that be any different for anyone being sold a computer or a camera or a TV set?  Even in an industrial marketplace ordering a pickup from UPS or initiating a discussion with a salesperson (chatbot) about purchasing some Broccoli from a farm in California should be and probably will be handled by the bots.   I think the obstacles are few and the bots can be set up to handle most common circumstances.  Exceptions can easily be supported by a human (salesperson) that first helps the customer and second teaches the bot how to handle the exception the next time round.

Where it will become more complex will be in the non commoditized space.  Here the conversations and the decision making process are more complex (and usually involve multiple stakeholders).  This requires a level of intelligent interaction for a sales person or in our case a seasoned Business Developer who can navigate and together with the prospect gain an understanding of the problems and pain that the company’s solutions can solve.  Only when both the prospect and the seller have a mutual perception of needs can one engage the prospect and all the stakeholders in more detailed and comprehensive discussion about the solutions a company can offer.

Envisioning a chatbot having the capability to do this - and at the same time be able to build and develop trust - is just hard to digest in the short term.  In 10 or 20 years? I would hazard a guess and say yes!  

 

Can your company boost sales through productivity gains?

In a given day week or month ….

  • What percentage of sales time is spent prospecting (i.e. developing highly qualified leads) versus selling?
  • How many sales visits (to qualified prospects) do your salespeople make?
  • Or how many conversations (cold or warm) do they have with targeted prospects?
  • Or how often do your salespeople reach out to their top 50 / 100 / 150 targeted prospects?
    • And what happens with those targeted prospects in the next range(s) (151+)?

No two sales forces are ever the same.  Neither are any two salespeople ever the same. However, whatever your existing resources you need to ensure that the focus should always be on those prospects the company has targeted (i.e. go beyond the low hanging fruit many salespeople focus on) … and are ready to buy.  This should be priority number one.

Having worked with some of the most sophisticated selling operations in the world in High Tech, Healthcare, and many of the world's largest Financial Institutions for some 27+ years, I can attest to the fact that almost none have a practical game plan to address selling productivity.  

So you may ask … “If these large and successful companies do not care about sales productivity then maybe it’s not that important?”

Let’s examine the following scenarios:

Realistic circumstance - No optimization

In scenarios where a salesperson role is to find, qualify and generate awareness among the prospect universe at least 66.66% of their time, then it’s likely that each salesperson will only close approximately 2 sales per month.  

New Sales Visits per week Average no. of sales visits per month Assume 20% Sales conversion ratio
2-3 10 2 sales per month

However, in an ideal scenario, a salesperson could potentially close 8 sales per month (400% more sales) if his/her role were to focus on highly qualified leads (HQL’s) 100% of the time .

Ideal circumstance - HQL’s provided for optimized sales productivity

New Sales Visits per week Average no. of sales visits per month Assume 20% Sales conversion ratio
10 40 8 sales per month

Primary benefits of maximizing sales productivity (in the above scenarios)?

  • 6 additional sales (8 total) or more sales per month per salesperson (300%+ more than the non optimized scenario)
    • Significant revenue gain
    • Reduced lost opportunity factor
  • You probably employ more sales persons than you need
    • Field salespeople are your most expensive sales resource (even if solely commission based)
    • Costs per sale potentially increase 4 or 5 fold because of low productivity

Sure nothing is straightforward.  No doubt Marketing and or your Website help to partially fill the sales lead pipelines with qualified prospects.  Rarely however, (I’d hazard a guess - NEVER) are salespeople provided with sufficient HQL’s so that they can user their time more productively.

And of course if a percentage of their time is involved in other activities such as Account Management and other Administrative activities you can bet the result in real terms is worse than outlined above.

ETI offers a free sales productivity analysis.  In full disclosure we do it (for free) because inevitably the rationale to use our services becomes more than obvious when you see the reality.  

Are you ready to measure your sales productivity levels and explore ways to potentially increase sales velocity by 400 to 500%?

Please call.  We’ll be happy to discuss.

 

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.

Real Time Web Analytics