Media coverage used to make or break sales deals. But now?

I was speaking with a corporate salesperson late last week. He works for a B2B company with at least 2000 employees in the U.S. alone. He said in the past five years he’d almost never heard of a customer raise the name of a journalist or reference a magazine article when discussing what was shaping their opinion on likely suppliers to shortlist. Industry analysts yes, top-tier and boutique consultancies yes, competitors yes but barely ever a magazine or newspaper article. How times have changed.

ComputerTradeMagsWhen I started my career, journalists were the primary go-to sources for industry news, trends and suppliers. Would-be corporate buyers would immediately be on the phone to their supplier’s salesperson the second they saw a negative press article on that supplier. Within hours (and sometimes minutes) I’d get to hear of it and have to go into defensive mode. That coverage jeopardized sales. I wonder if that ever happens these days? And it got me wondering what proof any PR agency or in-house corp comms person ever has that the media coverage they’re striving so hard to gain has any actual effect on their target buyers? Twenty years ago that proof was tangible. But today?

How do salesforces decide to divide up their target market?

There’s very little science gone into how salesforces decide to divide up their target market between their various sales channels. It tends to change every time there’s a change of sales director or chief exec.

I’ve run a two-man band up through a fifty employee company in my time. And when I think about how my approach to purchasing changed between the two, I realize it wasn’t anything to do with headcount. It was to do with responsibility.

I was in a discussion recently with a prospective client – an organization targeting companies with 10-50 employees. We got to talking about why their boundary point was 50 employees. “Because after that our partners are best (at selling in to them). They start getting complex and we don’t have the sales time to devote to them.” I wondered how true this really was.

Over the years I’ve had a special interest in how sales forces are structured to address different markets. It’s not uncommon for vendors to divide their prospects into five or more sales approaches – varying from online to retail, from direct end-user sales to ‘house accounts’, from third-party channels to strategic consulting partners. Almost always the dividing lines between these approaches are based on the prospect’s employee numbers. It’s an obvious and easily accessible number to access from the outset. But increasingly it makes little sense. So why is it still so prevalent?

How responsibility is placed across a company’s management levels is a far more significant indicator of how any purchasing decision will be made, and who will likely be involved to make it. Vendors have traditionally argued that this information would rarely be known from the outset, and may be too difficult to comprehend at any stage of the sales process.

But what if it wasn’t difficult to ascertain? What if a salesteam could know this on day one, and allocate their various sales resources accordingly? A vendor’s sales prospects would be divided up very differently than the current model, and possibly lead to a very different sales success rate.

The issue is that no one vendor has a picture of how every new prospect is organized in terms of management and budget responsibility. But I don’t think we’re too far away from that day. The application of a little science, plus the technology of crowdsourcing and a willingness to discard traditional practices, could lead to make a very major breakthrough in how vendors approach their whole sales process. But I haven’t heard anyone pursuing this.

How do you cost-justify your Influencer Outreach Program?

Influencer50, Nick Hayes, Influencer Marketing, WP#17 What is the cost of Inaction?

Here’s an excerpt from the new White Paper we’re publishing later this week.

“We proactively asked twenty of our clients how their companies were cost-justifying their Influencer Outreach program. (Of course, since we work with them we already knew the answer in most cases, but we asked again for this Paper.) 

  • Option a. Hard metrics such as Number of Leads generated, or Value of Potential Deals discussed?
  • Option b. Softer metrics such as Number of Influencers met, or Amount of Tangible Outcomes?
  • Option c. Or just simply ‘Does it feel like this is moving in the right direction for us?

Responses:

  • Option a. Three of the 20 respondees
  • Option b. Eight of the 20 respondees
  • Option c. Four of the 20 respondees
  • Two said a mixture of a and b.
  • Three said a mixture of b and c.

So the median chose to cost-justify the outlay either solely through Number of Influencers Met, Amount of Tangible Outcomes, etc. or with a leaning towards a more ‘feelgood factor’ than that.

Only 25% used harder metrics.

A further 20% were comfortable relying on less metrics and more subjectivity.”

‘WP#17: Commissioning an Influencer Program: What is the Cost of Inaction?’ will be available from 24th Feb’14.

SMORG, MORG & LORG. Are the dividing lines still relevant?

How much thought do vendors give before dividing up their salesforce into those targeting audiences such as Large Enterprise, Corporate, Medium Business and Small Business? And where do they place those division lines?

I was talking a couple of years ago to the Head of Strategy for one of the IT giants. He was explaining how their salesforce was organized. I can’t remember the exact numbers now but let’s say Medium Business was for companies with between 200-1000 employees, Corporate was 1000-5000 employees and Large Enterprise was anything above that. Each group had a very different approach to the sales process. When I asked what research they’d done to inform themselves that buyers bought equipment in one way up until say 5000 employees but in a different way beyond that, he admitted they’d done none. He said they’d simply copied Microsoft’s traditional approach. That’s Small Org, Medium Org and Large Org. Or SMORG, MORG & LORG!

I started to think about how companies morphed their buying process as they grew (or downsized). We analyzed as many buying structures as we could over the next twelve months (and still continue to). Companies do exhibit very different buying behavior as they change size and outlook. Also as they move along the centralized / distributed power axis.

But they don’t change buying behavior as they move from 4000 to 6000 employees, or from 100 to 300. The dividing lines salesforces make to carve up how they approach the market is perhaps two decades out of date. How strange that with all the changes in salesforce technology in the past few years, such a fundamental tenet of salesforce organisation has been left untouched. Is that because it’s still working, or because no-one has the data to prove it’s not working?

Small U.S. businesses show a five-year near 40% drop in single-signoff expenditure thresholds.

i50 logoOur research into the buying behavior of almost 100 small companies in the U.S. shows that discretionary budget allowances – the amount at which a mid-management line manager or similar can approve a purchase without needing a second signature – has now fallen from an average $10,400 in 2008 to just $6,290 in 2013.*

Considering the median size of these small businesses was those with 32 non-manual labor employees (so removing many small warehouse, distribution and construction organizations and skewing the results towards office-based operations), this is a pretty significant finding. In five years that’s a near 40% reduction in a line manager’s budget autonomy.

The upshot is that the role of ‘influencer ecosystems’ is filtering down the purchase funnel, now affecting significantly more, and smaller, purchases than previously the case. Even fewer purchase decisions are being made alone.

This presents greater challenges to salespeople of course, because even if they do reach the decision-maker in a small organization that individual will now not be making up their mind on their own. The salesperson will need greater help in ‘closing off’ the members of any ad-hoc decision-making committee. Vendors will need to have reached, and influenced, these key influencers well in advance of any purchase decision being made.

This inescapable trend in small business buyer behavior further elevates the center-stage role now being taken by ‘influencer marketing’.

* Influencer50’s research comprised responses from 97 U.S.-based small businesses (less than 250 employees, not including manual or part-time labor), across five industry sectors – retail, manufacturing, services, technology, transport. Research conducted between Jun-Oct’13.

Engaging new book I’ve just finished – ‘Conversations That Sell’ by Nancy Bleeke

The Buyer-side JourneyIf you want a steer on a great introduction to how salespeople need to engage with their prospects these days look no further than Nancy Bleeke’s book ‘Conversations That Sell’.

Published midway through this year it’s an easy, logical read with a fair number of insights into the changing demands of buyers today – and how salespeople need to address those changes. What’s particularly interesting is that it refutes some of the findings from Josiane Chriqui Feigon that I posted about last week. Seems they disagree on whether the salesperson’s role is becoming more or less important to the buyer.

Her site is currently offering the first chapter free.

http://www.conversationsthatsell.com

 

How the Field Sales to Inside Sales transition reflects & impacts the decision-making process.

Josiane Chriqui Feigon, Influencer50, The Buyer-side JourneyFollowing last week’s reblog about Josiane Chriqui Feigon’s ’10 Reasons why Inside Sales will displace Field Sales teams by 2015′ I wanted to review how that impacts our understanding of the major B2B sales influencers.

She says that 57% of the B2B buying process is now completed before ever connecting with a salesperson. As an addition to this point, she says we have 20m salespeople apparently ( I assume this is U.S. data only) – and that number is predicted to be reduced to 8m by 2020 – largely because of this ‘reduced’ role.

Now that’s clearly not a message any salesperson would want to accept – that they’re there to navigate the prospect through only the final 40% or so of the process. It means the salesperson has less opportunity to redirect that choice than ever before. I don’t have data but I wouldn’t mind betting ten years ago much less than 40% of the sales process was completed before the salesperson typically entered the fray, leaving them plenty of time to persuade any would-be buyer.

So now the salesperson is correcting impressions already made about their brand rather than initially setting them. And if there’s one complaint I’ve heard more than almost any other from salespeople it’s that they get to hear of opportunities too late in the day, where they’re having to respond to an already shaped RFP (Request for Proposal), they’re invited in only alongside multiple ‘less worthy’ alternatives or they’re having to force-fit their offering in to a less than ideal already-in-place framework.

I often say that assuming a salesperson manages to get in to a one hour meeting with his/her prospect per month then that’s the one hour of the month I’m least interested in, because only the salesperson is relevant for that hour. I’m interested in the 21 days six hours each month when the prospect is hearing from everyone else but the salesperson. And if the salesperson feels they’re now facing a reduction in influence as a result, well that just makes those influencing during those 21 days six hours even more important. And even less feasible for marketing depts. to ignore.

This brings me to a second point Josiane makes. The rising number of strong influencers in any B2B decision – varying from 5 to 21 according to her – allied to the fact that telecommuting means many of these will work away from the central office – means that scheduling an on-site meeting with the committee of decision-makers will be almost impossible. 85% of buyer-seller interactions will therefore happen online through social media and video. Most salespeople today will dread this thought since they base much of their confidence in their persuasiveness to their in-person face-to-face skills. Skills that are far harder to convey on a Skype call.

Yes of course there will have to be a very different type of salesperson required (a subject I’m sure I’ll write about soon) but an undeniable conclusion to this dramatic sales shift is that the role of ‘behind-the-scenes’ influencers will only increase.

Reblog: Big B2B Firms Are Talking Past Their Customers

More proof that too many vendors talk a completely different language to their buyers.

http://profitecture.com/big-b2b-firms-are-talking-past-their-customers-–-but-you-dont-have-to/

Hat tip to Paul Gillin for another great post.

Should marketers really be focused on keeping their salesforce happy?

Had a conversation with a client inside a major marketing dept. a few weeks back. I asked “What makes you think you know what influences your customers?”. “Our salesforce tells us – and they always say advertising helps. That’s about it. And taking their prospects out to see existing customers of course.”

It can’t really all boil down to these two things. I often hear advertising called ‘air cover’ – hard to measure its effect but you need it there to create the impression of weight. Many salespeople have traditionally liked advertising because it gives them an entry point into a prospect conversation – “You might have seen our ads in/on ….” I don’t have a great issue with B2B advertising – because it clearly does work with buyers sometimes.

Installed-base trips have always been, and will surely remain, extremely important in many B2B sectors. A great endorsement can be priceless. But we all know there’s more than just these two tentpoles.

It interested me that he seemed content that his view of the customer was sourced entirely from his few contacts in sales. Especially considering how superficial this advice obviously was. I was surprised my guy in marketing was so dismissive of the original question. And so un-analytical. Perhaps he felt he didn’t need to look any further.

Maybe he saw his job (which he’d kept for over ten years) as keeping the salesforce happy more than he saw his job being to understand the customer. It left me wondering how prevalent that view might be in marketing depts today?

New Influencer50 White Paper: ‘Can You Be Influential To A Market And Still Remain Almost Exclusively Offline?’

Influencer50 Inc., Influencer Marketing, Influencer Identification, Engagement & Measurement, Nick HayesHow are B2B decisions really being made these days? And is social media involved in the process?

http://prn.to/1alMOLL