Sales Modeling

Can you identify your “raving fan” customers?  Do they receive special treatment and participate in advisory boards, product and modification feedback programs?  More importantly, are your best customers a source of plentiful leads?

The best “sales” movie beyond a doubt is Glengarry Glen Ross.  If you’ve already seen it, watch it again as nothing reinforces the trials and tribulations of being a salesperson like this movie.  It also highlights the perceived importance of quality leads…“I need the good leads!”

Too many unqualified leads and you have a problem; too few leads and you also have a problem.  In terms of “good leads” nothing compares to referrals from satisfied customers.  Referral leads have a greater likelihood of converting into qualified opportunities.

Therefore, your blend of lead sources should include referrals.  If your sales and/or marketing organization lacks a specific initiative in this area, go proactive!  Nothing prevents you from asking your happy customers “who do you know that could benefit from our (company’s) products and/or services?”

If you accept “time is capital” should you waste time leaving voice mails?

Of course, every sales model (you are unique) is different which may dictate phone vs. email vs. in-person.  However, keep in mind people buy from people and email is not especially personal.  In-person is most desirable, but you have to consider cost of sales.  Ultimately, you have to build rapport to move any deal forward and not many deals are consummated over email (sidebar: I am not a fan of Email Marketing strategies.)

Back to the question of voice mails…yes, leave a voice mail.  In fact, leave many voice mails.  More often than not multiple email messages (executed with professional integrity) to the same person will beget a returned call (i.e. positive results.)  A proper voice mail strategy enables savvy sales persons an opportunity to distinguish themselves and their company.  Subsequent voice mails can help establish “equal business stature” and impart knowledge and relevant experience.  Don’t get me wrong, your messages should be short and sweet; be concise.  If you sound the least bit desperate (i.e. used call salesman) you are done.  If you come across disrespectful, you are toast.

You will often reach the point where you must give up (trust your instincts) and accept “sales is synonymous with rejection.”  But, before you reach that point demonstrate professional persistence.  Leave voice mails which suggests you will keep calling until they return your call, but say it with humor and be light-hearted.  To your surprise and amusement this action will often foster a rapid response (returned call) with an apology and compliments to your tenacity.

I am skipping strategic subtleties, but you get the gist.  Be competitive; make voice mails a game where “losing is unacceptable!”

Importance of a well-structured price list can not be overstated.  Your price list consists of products and prices.  Therefore, discounting and related approval processes will be governed by your price list.  Smart companies have circumvented entire discounting impasses and ultimate fiascoes by building discounts into the price and messaging customers to the extent “discounts have already been applied.”  There can of course be some wiggle room here, but suffice to say smart companies have adopted derivatives of this approach to significantly reduce cycles related to contract modifications and time-consuming sales management approval cycles.

Consistency is key, as well.  Your customers will talk and if they discover inconsistencies it can be detrimental.  A related challenge is managing pricing across multiple channels.  One thing your customers will greatly appreciate and therefore correlates to loyalty is an easy to understand and easy to administer price list.  Given these times of tight budget controls any surprises related to price and subsequent investment are frowned upon.

An often overlooked aspect of pricing is how easy it is to explain for the sales person.  If your product mix is bundled, it is much easier.  However, if it is unbundled there is potential for upsell, later.  There are trade-offs to each approach.  Keep in mind a funny factoid about price lists: the more products you have on your price list the more you will sell.

Again, smart companies know this and often rename the same product multiple times.  For example, they may list the same product under multiple vertical solution-oriented names.  With today’s economy, many customers are contractually avoiding anything that smacks of multi-year commitment without language that permits early exit without penalty.  Therefore, your pricing should potentially reflect this current trend.

More complex sales opportunities (versus tactical, small ticket) demand “executive bridging” protocols and methodologies.  If nothing else, these exercises dramatically increase close rates.

How is this accomplished?

Step 1 (usually conducted by the sales person) is creating an organization map or matrix which is based upon an organization chart.  For example, matrix identifies titles, roles and influences which clarifies executive sponsor as well as ultimate decision maker (i.e. person who signs the contract.)

Step 2 is mapping executive sponsor(s) from your company with appropriate counterparts per step 1.  Essentially, the sales person will identify a corresponding executive sponsor from his/her company to interface as dictated by opportunity.

It is really quite simple, but elegant in execution.  But, there is an important mutual communication dependency.  It is advised to have sales person properly debrief his/her company’s executive sponsor(s) and then afterwards (be it in-person, phone, or email interaction) have sponsor reciprocate with debrief which states clear and relevant action items necessary for sales person to close deal.  Obviously, a proper debrief document which is concise and delivers articulate talking points and summary is critical to success.

The pitfalls of deploying CRM are well-documented and CRM failure rates are lofty.  Your marriage has a much greater chance of success.  However, there are ways to mitigate what are for the most part are well-understood risks.

For example, measuring ROI is highly correlated to CRM project success.  Setting and measuring return on investment creates tremendous focus and discipline before, during and after implementation.  ROI should be measured at sequenced intervals against consensus-based performance baseline.  Having been privy to literally hundreds of CRM deployments, I am consistently amazed at how many companies fail to even consider a practice which includes establishing a baseline and tracking improvements.

Another best practice is proper executive sponsorship with strategic imperative alignment.  For example, messages from senior executives enforce accountability and motivate change which correlates to “all-important” user adoption.  Executive sponsors should articulate specific business rationale such as increasing market share and achieving annual revenue targets.

Lastly, small “pilot” projects will provide insights to ensure success upon broader rollout.  Again, setting MBO-type milestones will create positive energy and generate momentum for holistic CRM effort and galvanize bottom-line impact.

Do all of your sales quotes have an expiration date?

An expiration date is an excellent way to create a compelling event and thus call to action.

Whether or not your quotes have expiration dates you should generate as many as possible.  In the end, it often boils down to a numbers game.

The fact is the more quotes you kick out the more deals you will close!

User adoption is easily the biggest variable to successful CRM which really starts with change management.

Without executive sponsorship and enforcement your project may wither and/or die.  As an interesting example, Larry Ellison at Oracle explained the consequences of adoption or non-adoption and upon firing a few people adoption won!

Other tactics that work well include:

• Role-based user training
• Input from business and IT constituents
• Functionality launched at adoptable intervals
• Cultural shift addressed

In most CRM efforts the key opinion leaders are salespeople.  Therefore, gaining their support is often the most critical factor in driving user adoption.  Keep in mind the following:

• Training must not be about how to use the tool instead about how the tool helps meet performance objectives
• Salespeople are inherently skeptical and control freaks
• Salespeople think information flows in one direction to the benefit of the company and fear new systems and policies will bog them down

Targeting successful, influential salespeople as early adopters gives your CRM effort credibility.  Salespeople need to understand how the CRM initiative reduces process complexities, improves team collaboration, provides actionable insights into data that begets better leads and reduces time to generate quotes, for example.

When evaluating and ultimately selecting a CRM tool do not rely on traditional content such as industry magazines, research websites , analyst reports, or advertising-oriented whitepapers.

Many industry analyst firms require software vendors pay for the opportunity to brief their analysts and subsequently “get on the radar.”  An analyst report is a proprietary product which guards how its market share is calculated and what other information they used in order to form their recommendation.

The closely-held secret is most companies do not get the benefits they expect from their CRM investments.  CRM’s promise of connecting companies and their customers to the benefit of both has not been matched by the reality.  Where most companies fall down is in believing that technical functionality alone is enough.

That is a mistake.  You must understand that technology is most valuable when it enables customer-friendly business processes that actually drive the bottom line, and when employees embrace it as a tool to improve customer relationships.

Be sure to focus upon which metrics really drives your bottom line and identify specific CRM initiatives, such as income from improvements in customer acquisition, retention, and cross-sell.

Open source, on-demand, or predecessor premise-based solutions each provide feasible alternatives with inherent benefits.  Again, remember higher-functionality and higher-cost CRM is mainly for those businesses in which team selling is important, the sales force is sophisticated, and cycles and buying influences are complex.

More likely, regardless of what you choose you will open the box it does 120 things and you only need 14.

Consistently, top-performing companies track their competitors as closely as possible.

For example, a CEO once told me that if General Electric buys this then I will immediately follow suit.  This fact expedited my sales cycle.

Always keep in mind competition (external pressure) is the type of compelling event that creates a rapid call to action.

Should you outsource an executive leadership position?

Many early-stage and fast-growth companies appreciate the option to outsource an executive position.  It is possible to engage a distinguished executive without long-term commitment and associated costs of a full-time employee.

The benefit of this approach is that it brings an experienced professional to help build sales and marketing infrastructure, enable linear growth and provide tangential management consulting.  Other benefits include flexibility, reduced comparable costs, and risk management.

Consider the alternative of conducting an expensive and time consuming search for a sales and marketing executive.