BANT

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.

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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!

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.

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.

The Case for and against a Universal Lead Definition (ULD)

There is a tendency by some marketing departments (pushed possibly by some marketing consultancies) to develop a Universal Lead Definition for their organizations.  The idea of course, is to get buy in from Sales to say that if you (Marketing) send me a lead with XY & Z characteristics then this meets our definition of a good lead and that in turn we (Sales) will commit to investing the time and resources in trying to close this opportunity.From the outset let me say I’ve never been in favor of this approach.  Especially if the definition consists of a tight BANT (Budget, Authority, Need and Timing) definition.  See Sheldon Sach’s detailed blog on this subject.

That said there are some positives.  If Sales accepts and commit to this arrangement and do actually invest time and resources then the alignment of Sales and Marketing is greatly improved and even if the leads are not what they might be then overall result will be more positive.  And from marketing’s standpoint they now have an agreed to formula to perform to. But there are lots of negatives.

First having worked with both marketing and sales departments for some 24 years I can tell you that in all this time I have yet to see a sales operation that will dance to marketing’s tune – regardless of the upfront commitments.  The one time I’ve seen some success is when management made a huge commitment to implementing a strategy and when the sales force balked – they fired 50% of them.  Are you ready to do this?  Most companies are not. The fact is a good sales lead involves a lot of subjectivity.  There are inevitably countless nuances that cannot be quantified of scored in any way.

Here is a list of some factors that are beyond the usefulness of a ULD:

  • Some sales people are good closers.  Some are not.
    • Some sales people feel a lead must be an order taking opportunity while others understand that it’s just a foot in the door.
  • The Pareto principle applies as much to Sales – as it does to Marketing
    • 80% of sales are brought in by your top 20% salespeople
    • Only 20% of leads provided by Marketing closes
    • Only 20% of leads provided by Marketing are worthwhile
    • And so on.
  • Some leads may have long lead times … others will close in the short term.
    • Typically the larger more complex sales take longer to close and many sales people cannot be bothered because it will not affect their quota in the short term.
    • Yes sales people for the most part do not see the long term.  And even if they do they do not manage a pipeline for the long term.
  • More and more there is no one decision maker.  Even in the smallest companies decisions are now being made by (formal or informal) committees.
  • If the lead fits the BANT model you’re probably too late for the party.

At ETI we’ve opted for a more customized approach.  We prefer to work with individual sales people and deliver tailored leads that work for them.

Can one effectively do this?  Of course and we’ve done so for many years.   Which do you prefer? Do you prefer pushing a standard lead model (a round peg) down a square (sales force) hole?

Give us a call at 1.800.466.4384 (914.747.3030).  We’ll be happy to discuss this and other needs you may have in more detail.

 

Shifting focus from selling to relationship building

I received an email the other day from Ari Galper. Ari runs a sales training business called "Unlock the Game" (www.unlockthegame.com) which focuses on shifting the perspective from selling to relationship building. At the core of his teaching is an understanding that the key to sales success is in reducing stress, not increasing the pressure.

Partnering Business Developers (BDs) with Sales

Experience shows that the relationship between Business Developers (BDs) and the sales people who ultimately are our primary constituents is very important to the success of a business development effort. A basic element in this relationship is the need to foster bi-directional communication as a regular discipline.

Lead generation vs. Appointment Generation

What are the primary differences between Appointment Setting and Lead Generation efforts?

  • It’s relatively easy to get appointments.  Even with top decision makers in large companies.
  • It’s generally much harder to identify genuine purchase potential in addition to setting an appointment with the key  individuals who would ultimately be involved in making a purchasing decision.

Why?

Appointment Setting:

Assuming the solutions you offer and your brand is well positioned in the marketplace, then many executives may be at least willing to “learn” more about what you might be able to do for them.

If you’re brand is not well known, then it’s certainly much harder.

However, when little or no commitment is involved, it’s an easier row to hoe.

This does not, however, signal that they have real buying interest.  They may have a need.  They may even have some pain.  But that’s not what’s being asked of them.  They’re simply being asked to say yes to “learning more.”  Most of all, it doen’t mean that their organization has the capacity to implement the required change in the near term.

Yes, a good sales person who is worth his or her salt might take this opportunity and, over time, develop it to the point that a sale can take place.  However, rarely do appointment setting programs generate near-term sales.  And rarely are sales persons efficient and patient enough to nurture leads over time to ensure their long-term success.

Of course, you can always get lucky.  But luck is not a strategy. It’s always useful to remember in this context that in any given sales force the 80/20 rule generally applies.  80% of the sales force is comprised of order takers (or farmers) and only 20% are real hunters.  Moreover, generally speaking, 80% of the sales force generates 20% of the sales revenue.

So is an appointment with a decision maker in and of itself a “bad” result?  No.  It’s just not an efficient or productive one, because the productivity of the sales person is not maximized and the cost per sale, ultimately, is more expensive   even if your cost per appointment is lower.

Lead Generation: Consider on the other hand a lead generation effort that is focused on maximizing sales productivity.  It emphasizes identifying real “ready to engage “opportunities, enabling the sales person to spend more time selling to the right prospects at the right time.  In other words, lead generation effort should not just open the door,they should open a door only where real potential to purchase exists.

Why it comes down to sales productivity.

Sales productivity has been addressed many times in this blog.  In fact, for the past 20 years it has consistently been ETI Sales Support’s motto.  (You may find the 3 part blog entitled  Rethinking BANT  of interest.)

Table 1:

Assumption Explanation
Time available to each sales person A sales person can potentially visit with one opportunity per day
Cost per appointment (Appointment Setting effort) $600
Closing ratio – Appointment Setting (year 1) 10%
Closing ratio – Lead Generation (year 1)/td> 20%
Appointment Setting annualized result: Assume 50 weeks per year X 5 appointments per well X 10% closing ratio 55 Sales Cost $150k Cost per sale: $2,727
Lead Generation annualized result: Assume 50 weeks per year X 5 appointment per wellX 20% closing ratio 110 Sales Cost $250k Cost per sale: $2,272
Impact of increased sales productivity on the cost per sale $455 less from a Lead Generation effort vs. an Appointment Setting effort.

So even though the cost per opportunity is higher ($1,000 vs. $600) via a Lead Generation effort, the number of “sales” over the equivalent period is double and the actual cost per sale is $455 less than the result of an Appointment Setting effort.

Lastly, let’s also not forget the Lost Opportunity factor.  If your sales people are not calling on those prospects that have real buying potential and the competition is, then your poor investments in Appointment Setting are just that much more costly because they are spinning their wheels talking to the wrong people and the wrong prospect companies.

So think twice about wasting precious selling time on plain old appointments.  A better choice would be to invest in a highly effective and sustained lead generation effort that will result in real sales sooner.

Rethinking BANT, continued: How to better define a qualified lead

Final part of a three-part blog Part 1 | Part 2

In Part 1 of my three-part “BANT rant,” I expressed doubts about BANT being sufficient as the determinant of qualified sales opportunities.  First and foremost, BANT takes a seller-centric perspective that doesn’t consider the ways in which buyers think, at least not with respect to purchases that are not commodities.  Second, I suggested that while the BANT elements might be necessary for a buying decision, by themselves they are not sufficient to ensure that a purchase decision will ever be made, or if that purchase decision will be favorable to you.

In the second part, I reviewed each of the BANT elements, exploring in sequence why I felt that the BANT model is overly simplistic and fails to consider the buyer’s perspective.  I argued that requiring a Budget, for example, was less relevant than having adequate Resources (to acquire your solution), and might even work against you if that budget was determined without your input.

Then, I suggested that Need was also seller-oriented; the buyer is focused more on having a reason to act…now if the problems are imperative.  We have a multitude of needs that often remain unfulfilled for lack of impetus.  And, depending on how vital it is to obtain an adequate solution, the resources will flow accordingly.  Finally, I argued that decisions (perhaps for anything other than commodities) are virtually never made by a single individual, especially in the enterprise.

In all, I thought the following questions were far more buyer-oriented and relevant to how and when a decision would be made:

  • Is there a compelling reason to do something?
  • Are the stakeholders who would feel the impact included in decision-making?
  • Is there a solution out there that can resolve the problem using the resources available?
  • And, are there substantial consequences for failure to act timely?

Perhaps the very best place to start is by taking a hard look at the sales process and analyzing the critical stages.  First, a statement that may seem, on the surface to be overly simplistic, but when you consider it carefully, you may find yourself in full agreement.

The biggest impediment to closing a sale is inertia.  And, overcoming inertia is the primary challenge. Look at some of the language of selling: “value is more important than cost,” “it’s vital to provide clear ROI,” “establish mutual perception of need,” “where’s the pain?” and so on.  These are all perfectly legitimate perspectives, and I have made similar statements like that many times in coaching sales people.

But, the fact is, you can definitively establish value and pain and need and ROI and yet the prospective buyer simply doesn’t buy.  They continue the status quo with all of its inherent costs and pain (all of which they have openly acknowledged).

I can’t help believing that the reason for inaction is that the perceived cost of changing the way in which they currently operate – financially, emotionally (more likely) or both – exceeds the cost of maintaining the status quo, even to the point where status quo leads to the failure of the company.  It may not be rational, but it is quite human.

So, if inertia is the critical factor that a sales person needs to overcome in order to successfully conclude a sale, then it is vital for them to have an understanding of the prospect company’s orientation to change.  Wouldn’t it be important for them to know if a company is risk averse or, alternatively, is an early adopter, or somewhere else along the continuum?  And wouldn’t that be a valuable element to capture and rate relative to the qualifying characteristics?

This is clearly the missing element in the traditional BANT paradigm because, regardless of whether you view the sales process from a buyer or seller’s perspective, an opportunity can’t be seen as fully sales qualified unless there is a legitimate possibility that the prospect company will make the necessary changes. So what we do have?  I suggest “I CARE”:

  • Imperative – a compelling reason to consider a new solution
  • Consequences of inaction
  • Agreement among stakeholders
  • Resources to obtain a solution
  • Environment conducive to change (overcoming inertia)

This acronym represents a more practical and accurate method for defining a qualified sales opportunity and it is equally applicable to both seller and buyer.

First, it’s important to uncover a compelling reason for a company to take an action to meet a need or resolve a challenge.  Next, the consequences of inaction need to be sufficient to warrant a search for a solution.  Is there consensus for taking action among all the key constituents (stakeholders) who are feeling the impact of the need/challenge as well as those responsible for resolving it?  Then, a solution needs to available and the capacity to obtain the resources needed for a solution needs to exist (remember, if it’s important enough, the resources can be found, regardless of budgetary considerations).  And, last and most important, how amenable is the organization to effecting change?

Before I end this, I don’t want to forget the promise I made at the end of the first part.  Here is the setting:

You are walking down the street on your way to an important meeting.  It is lunchtime and you are hungry, you have the resources and sufficient time to eat.  There are a multitude of restaurants and street vendors, including some of your favorites.  Although you are hungry, eating is not your highest priority.

Your decision to stop and eat is reasonably complex.  There are competing needs, at varying levels of urgency.  You are hungry (a function of an early breakfast), abetted by a regular ritual of eating lunch at the prescribed time.  So your internal debate will take a multitude of factors into account.  For example:

  • I’m hungry
  • This meeting is very important
  • I always eat at this time of the day
  • I have sufficient time to eat before my meeting
  • I would love a few moments to check my email and voice messages before my meeting, (but I could do that without eating)
  • If I don’t eat, my growing hunger may become a distraction during the meeting
  • I have more than enough money in my pocket and, besides, my bill for lunch will be covered as a reimbursable expense

While considering your options, these and other questions will arise until you make a decision.  And, of course, making no decision is equally a decision.  In complex businesses, making no decision is what happens all too frequently – because the cost of doing something has ripple effects throughout the organization.  Inertia – maintaining the status quo (sometimes even in the face of all rationality such as unquestionable ROI) – is too often the easiest course of action.

How would this decision-making process be represented in the I CARE model?

  • Imperative: hunger, time of day (lunchtime)
  • Consequences of inaction: poor meeting performance, distraction
  • Agreement among stakeholders: You (and your growling stomach)
  • Resources: money is not an issue, and it’s a reimbursable expense
  • Environment conducive to change:  it boils down to inertia, doesn’t it?

How can a proprietor get you to stop and eat?  What can they do to raise the threshold high enough to overcome inertia?

You experience the answer all the time in those situations, don’t you?  Some vendors and restaurants pump out tantalizing smells of their luscious offerings and tease you with them.  Others do something with their display; maybe they toss the pizza in the front window, or display the desserts or even offer you a complimentary taste in front of their establishment.  Maybe they offer free Wi-Fi that enables you to easily and quickly check your messages.

All of those actions and offerings are designed to entice you to into their establishment and overcome inertia.  When they hit the right hot buttons for you, you’re sold.  But even having decided where you may eat, unless all the other factors are aligned you still may not physically go in (inertia).  It’s only at the point that you decide to CHANGE the course you’re on right now that the sale may actually get consummated.

To conclude what we’ve been exploring over the past few weeks, BANT has been a useful and important early model for focusing the qualification process.  But it needs some rethinking because it fails to consider the prospective buyer’s viewpoint and is inadequate in identifying the elements that are the key determinants for concluding a sale.

When a seller has a clear understanding of how a prospective buyer makes their decisions, and solid insight into how the prospect views the issues and their proclivity to change the way in which they behave, they have more chance of success.  This more closely aligns their goals with those of the prospect and provides them with far better insight as to the hot buttons that will serve to overcome inertia (which is, after all, the heart of the sales challenge).

And isn’t the purpose of defining a qualified lead all about providing sales people with opportunities that offer them a better chance of closing more sales in less time?  Success in that endeavor is the basis for enhancing sales productivity, maximizing ROI and increasing sales revenue.

BANT, however time tested, does not necessarily increase the chance of sales success.  I CARE does it better.

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