A Brave New World: Responding to Shifts in the Selling/Buying Model

IMG_0490

Last week, The Complex Sale, Pedowitz Group, Eloqua, and Oracle hosted a luncheon designed to brief sales and marketing executives on how their worlds were changing.  It was a great turn out with even better insight into how buyers are changing their habits. At no time in history has Sales and Marketing seen as radical a shift in buying behaviors as in the last five years.  With tools like Google, Facebook, Twitter, and LinkedIn, information is now quite literally at our buyer’s fingertips.

Organizations are having trouble adapting to this change.  The concept of the new “Sales 2.0” world has created more questions than answers as to how Sales and Marketing can leverage new technologies to drive messaging and sales effectiveness. 
 
Today, buyer “self education” renders Sales and Marketing blind to buyers’ interests, propensities, and levels of engagement in our typical Sales and Marketing plans.  Buyers are less likely to engage with sales teams or to read our messaging.  Instead, buyers leverage Webinars, Online Meetings, and interactive web sites and control the sales process themselves.

Steve Woods, author of Digital Body Language and CTO of Eloqua states, “a sales person’s biggest competition for an executive’s time is now Google.”  If we as sales people cannot bring more value to the conversation than what is available online, then we are not going to capture an executive’s time or imagination.

Rick Page, author of Hope is Not a Strategy and founder of The Complex Sale states, “lead generation used to be about a hammer, now it is about a hook.” The hammer was the telephone with endless cold calls beating executives into appointments by attrition.  The hook is an opportunity for the executive to learn something insightful about their own business, industry, or competition.

Debbie Qaquish, Chief Revenue Officer at the Pedowitz Group states, “Marketing is earning its way on sales incentives trips by first, collaborating with sales to create the definition of a lead and secondly, providing insight into buyer activity on the company website that will triage the sellers call efforts.

The session ended with the obvious question – what hasn’t changed in selling?

The evaluation process is still logical and rational where the decision making process is emotional and political.  By avoiding the three foot rule (being within three feet of the prospect) and handling the sale over the web and phone, sellers risk becoming a victim of the crucible concept. Sellers need to know the competitive and political landscape, source of urgency, and enterprise level issues to when complex deals.

Advertisements

Caution: Whales in the Swimming Pool

no swimmingIt is right around this time of year when I start to get very anxious. The summer is winding down, my alma mater begins their football season, and our buyers are awakening from the summer doldrums. As sellers, our sense of urgency increases because the end of the year is within sight – and the same is true of our buyers.

Or is it?  Follow this link to read my thoughts on forecast accuracy.

Try this little exercise. Pull up the pipeline you have been working diligently to build over the first 9 months of the year. Sort it by revenue from highest to lowest. If you are like most sales professionals, you will find there is a correlation between the size of the deal and the proximity of the close date to December 31st. In other words – the largest deals are generally the ones the furthest pushed out. This is natural and stands to reason. After all, these deals aren’t fully scoped therefore we don’t want them gaining the attention of the powers that be. However, we still want the recognition that there is a whale or two swimming in our pool. Since we don’t know when this deal is going to close – we assume that the buyers will have the same source of urgency that we have and that it will eventually close by the end of the year.

We as salespeople need to realize that this, in fact, is not the case. Many of us have the high hopes that 2009 will be very different from 2008 and buyers will finally come off of their wallets. But just as Rick Page has taught us – Hope is Not a Strategy.

Three items we need to consider when we are thinking about these whales at the end of our pipeline for 2009 . Start doing these things now so you can be assured you are well positioned to close out the year strong:

1)    The global recession has made buyers much more cautious and conservative with their earnings. Therefore cost justification models are not enough to close a complex sale. CFO’s have been piling up proposals with ROI’s attached for two years.

To Combat this, Find the Powerful People: Align with the individual who can and will walk your proposal into the CFO’s office and say, “I need this signed because it is critical to the success of our business.”

2)   Our sense of urgency to close by the end of year is motivated by our internal pressures to make quota. Our buyers do not share this motivation.

Uncover their Source of Urgency: Find out what does motivate the decision-makers to buy and by what date they need this solution. If Jan 1 comes and goes without our solution in place – what are the negative ramifications to the organization?

3)   Many buyers have little knowledge about evaluating our solution and our implementation timeframes. Therefore by the time they get around to evaluating your solution it could be too late to have it up and running by the start of the year.

Closing Strategy: Through a position of empathy and experience, share with your buyer your normal evaluation, approval, and implementation process in the form of a timeline. Back it out from the source of urgency date for go-live and let them know the steps needed to start by that date.

Try this process to help feed the whales swimming at the end of your pipeline.

What Closes the Deal? Sense vs. Source of Urgency

calendar

Isn’t it great when a month ends on a Friday? You get a chance to wrap up both the month and the week in the same day. If you are like most sales people you also get a chance to lean on your prospects just that much more to get the deal in. After all, that’s our source of urgency, making our number by the end of the month. We find ourselves much more motivated (as does the procurement department) because there are negative ramifications if we fail to deliver.

Let’s take that idea and turn it on its head. Do you think our prospects have a source of urgency? Do you think there are negative ramifications for our prospects if they don’t get a solution in place by a certain time? The answer is an unequivocal…..yes! Companies are a lot like individuals in that they won’t make a change until they absolutely have to. For sellers to know if they are in a qualified deal – they need to know why the buyers “have to” make a change.

Many sellers confuse the  “want to” or sense of urgency with the ” have to” source of urgency. A sense of urgency is more often than not tied to our value proposition. As an example:

  • Automating manual processes
  • Better reporting
  • Lowering total cost of ownership
  • Scalability / Flexibility
  • Mitigate Risk
  • Best of breed / Best practice
  • Consolidation
  • Streamline / Ease of use

All companies can benefit from the above and many have a sense of urgency to get them done. A source if urgency however has a date by which these benefits must be implemented because the company (and more importantly a specific individual) will feel a tangible effect if they do not. Examples of sources of urgency are as follows:

  • New facility / market / clientele
  • New executive strategy
  • Capital purchase
  • Board directive
  • Compliance effective date
  • Product launch
  • Merger / Acquisition
  • Negative Press / Federal Investigation
  • Quarterly / Annual Report

Therefore, to better understand if our prospects are going to buy from us we need to know why they will buy from us. Until then, we will continue to be befuddled by their lack of motivation even though we have a perfectly rational value proposition. Start tying your value proposition AND your forecast to a source of urgency. Then you will see your prospects leaning on you to get the deal done and the end of the month will be just another day on the calendar.

Will we win? Will it close on time?

*** The Complex Sale, Inc. has recorded a webinar on this topic: https://www1.gotomeeting.com/register/794796552

crystalballexecutive

Outside of your own personal expertise, the most valuable piece of information you can offer buyers is your pricing. In the Complex Sale 2.0 world, buyers are gaining more and more control because information is becoming more and more available. Therefore, you should only share pricing when / if you feel you have positioned yourself as best as you can to win the business. If there is information you still need, you will not get it AFTER you send a detailed proposal.

Before you hand over pricing, make sure you can answer yes to these 11 questions.

Will it close on time?
 Do we know when they can no longer go without a solution?
 Do we know the decision-making process?
 Do we know the approval process?

Will we win?
 Have we linked our solution to solving enterprise-level pain?
 Do the decision-makers acknowledge our differentiation?
 Do we have enough votes of the decision-makers to win?

Will it close for the amount forecasted?
 Have we quantified the value based upon their criteria – not our ROI?
 Do we understand the political risk associated with this decision?

Have we prepared for the political nature of the decision making process?
 Are we anticipating counter-attacks of the competition?
 Are we aligned with powerful people to break a deadlock?
 Have we outlined the steps needed to get the deal signed?

The biggest mistake we see sales managers make is to base a forecast on stages in the sales cycle. Just because you are 85% into a sales process doesn’t mean you are going to win 85% of the business – or any of it for that matter. If you are in a competitive deal, your competition should be in the same phase and somebody has to lose. You need to compliment this quantitative step of forecasting based upon where you are in the sales cycle with the qualitative step of the 11 question deal review.Our research shows that 25% of forecasted deals are lost to competition by not taking this factor into account.

 

Our research also shows that 25% of forecasted deals are lost to no decision. That is why it is imperative to have the business case established before you present pricing. If you don’t understand the quantifiable metric upon which your decision-makers are going to base their decision, then you have a good chance of losing to no-decision.

First, Start with a Point of View

 

You really never do get a second chance to make a first impression yet I hear so many sellers stumble out of the gate with questions such as: What keeps you up at night? As discussed in an earlier blog about peer 2 peer selling, a peer is seen as an equal with similar acumen and experience. A conversation with a peer is not a series of open ended questions but rather one with purpose and a path.  Successful first calls are executed by following a model that begins with what we call a “point of view” and follows a six step process.

 POV 

 The point of view statement is an observation about the prospect’s industry or business followed up with a closed-ended question. As an example – I will use our own sales tool kit with a fictional VP of Sale:

“I read that your company is expanding your product offering to include a software as a service platform. We have seen that companies usually have a 6 month lag in revenue with this type of change because it takes marketing and sales that long to get on the same page with sales ready messaging. Is that something you have factored in?”

1. This starts the conversation on a path that will help us gather specific information. The prospect will either answer the question yes or no.

To prepare provocative point of view statements for a first call, I recommend InsideView. This tool can be embedded inside of your CRM on the account level to give everything available about the company, from the blogosphere, LinkedIn, Jigsaw, Facebook, and in Twitter. InsideView is offering a free version right now that is well worth the time invested. 

2. We want to understand the impact that a 6 month lag will have on the individual and their organization. We simply ask the question, “What impact will that have on your company?”

3. We want to confirm that impact in terms of metrics. If we are going down the right path –there will be a tangible repercussion. We will want to ask, “Just so I heard you correctly – a 6 month lag in revenue for this product line will mean $15,000,000 in lost revenue?” We would want to add some clarification as well to address a date by which this problem must be solved. “When is the product due to go-live?”

4. We want to create a mutual vision to address this pain. It is very important to align with their vision. We want to collaborate with them by asking, “What are your plans on getting sales and marketing aligned before product release.” We then follow up by sharing how we have helped similar organizations in similar circumstances.

5. Our next step is to offer a method of proof. Most complex sales will require some deeper discovery with individuals in the company. We want to get sponsorship of this discovery step but not without giving a “high-level” overview of what we are trying to achieve. “Our Sales Tool Kit will provide sales ready messaging at the time of product release to avoid the 6 month revenue lag”

6. We ask then for the prospect’s sponsorship on a deeper discovery and a time to demonstrate our proof of concept. “As a next step, you will introduce me to your VP of Marketing and Sales Operations department to tailor a proof of concept demonstration of the Sales Tool Kit. We can have something prepared for you by month end. Can we schedule a time for our next meeting then? ”

A Sales Tool Kit to Help with your Point of View

Selling like a peer means thoroughly researching all of your potential stakeholders to be well versed in their position and the challenges they face.  Successful companies take this research and put it into a sales tool kit for consistency throughout the entire sales force. It is vitally important to have a central repository available of best practices in messaging, competitive positioning, objection handling, and probing questions to prepare for a first call. Kadient offers a fully integrated content management tool with most CRM’s including Salesforce.com where the tool kit’s content should be housed.

A Sales Culture of Accountability

ChrisJarvis

A recent survey from the Complex Sale found that 93% of Sales Leaders thought that having a Sales Culture of Accountability was the number one cause for success!

Oftentimes, sales organizations use revenue attainment goals as the key metric for success. The revenue attainment objective is owned by one person and divided amongst that individual’s direct reports. This process continues throughout the sales organizations down to individual sales representatives – thus representing their quotas.

Revenue however is a lagging indicator of success. The best practices we see implemented by the world’s greatest sales forces attach leading key performance indicators as goals as well. The goals start at the top and cascade down to the field just as revenue attainment quotas.

Leading Key Performance Indicators are specific to individual sales organizations based upon their clients buying cycles and revenue generation targets. Most successful organizations start with how much revenue they need to attain from the base of accounts and create metrics around account penetration and retention. An example of leading indicators for account management would be net new opportunities, renewal rates, and percentage of growth; as applied to each account. We prescribe other goals for opportunity management around executive access or understood sources of urgency.  These companies track the progress of these KPI’s on a continuous basis such as monthly or quarterly. 

We see that the most successful companies use this process to hold sellers accountable for the correct activity and management accountable to the sellers. If an account manager is hitting their metrics and still not making their revenue target, then the manager is held accountable for coaching or resetting the goals. This practice leaves out any uncertainty in expectations throughout the sales organization.

Peer 2 Peer Selling (P2P)

 Say the right thing

A new study by Forbes finds that 53% of C-level executives do their own research online – well before they delegate a project or contact vendors. Therefore, sales people need to add much more value than the standard discover, present, pricing method that permeates our business. Our buyer wants to buy from a peer – or someone who can add value well beyond our product offering.

How does one become a peer of an executive? We must speak to them in their language.

Successful sales forces are able to take their operational features and functionality and translate their benefits into a compelling value proposition for non-technical buyers. As we begin to sell more complex solutions, more stakeholders are involved in the decision-making process. These stakeholders often do not have the technical expertise to distinguish our solution from the competition or other in-house alternatives.  

Inherent in a value proposition is a keen understanding of the pains of the non-technical buyers and a linkage of our solution to solving those pains. Many organizations make the mistake of having one generic value proposition – when in fact it must be tailored to the individual to whom we are selling.

This is most apparent when we generate a sales process through our own demand creation efforts. Oftentimes, executives who need our solution the most, have no understanding of what we do and need it translated for them to sponsor an evaluation.

As a go-to-market strategy, successful sales organization take a census of every potential stakeholder in their sales process. They uncover every potential pain this individual could have and link their solution to solving that pain. They also take inventory of every potential competitor and create competitive position statements and ways to handle objections. They lean upon the expertise of their best parishioners and marketing departments to create an easy to access tool kit for the sales force.

We have seen messaging tool kits used to shorten sales cycles, ramp up new hires faster, and move lesser skilled reps up to the level of more skilled sellers. With this knowledge and confidence – they are more effective listeners and can sell Peer 2 Peer.

%d bloggers like this: