The Sales Insider

I recently bumped into a post by Escape Velocity’s Liz Strauss called “When Too Many Options Are None At All.”

Having “18 fishing poles in the water,” she suggests, leads to a lot of “unfocused work for little return . . . We spend all of our time running up and down the bank checking to see if something worked or whether we need to rebait the system.”

Wise words.

I’ve said it before: In today’s marketing world, narrow but deep, not broad but shallow wins the day. For most small- to mid-sized businesses, better sales performance means conquering one vertical or market at a time, rather than trying to “dip” into a dozen different markets at once.

At the same time, sometimes a net is better than a pole. We’ve discovered over the years that there’s frequently a lot of overlap between markets/verticals in terms of process and need. The terminologies are different, the products they sell are different, but the underlying need to help them connect with their clients and prospects is the same.

Thus, sometimes it’s okay to use a net to cover more than one overlapping vertical, instead of trying to catch them one pole at a time.

But when in doubt, stick with one market, dominate it, find the next one, wash, rinse, repeat.

Loved a recent post by the self-proclaimed “A Sales Guy” talking about the fact that when a sale focuses on price, it’s because the relative value surrounding the price has no context.

Take, for example, two salmon fillets, one $6.00 a pound, one $9.50. Same size, same weight. All things being equal, you take the cheaper of the two, right?

But what if the $6.00 / pound fillet was raised in a fish farm with 10,000 other salmon and artificially enhanced—and the $9.50 / pound fillet is freshly caught, true Alaska Salmon?

The context controls the value here.

As “A Sales Guy” states, “There’s no good or bad price by itself. Price is a reflection of everything around it.”

Prospects move to price negotiation almost immediately because they know it’s the one thing they can control now. They don’t have to wait for a “proof of concept,” they don’t have to wait and see if the implementation is going to go smoothly, they don’t have to look at the inevitable workflow, personnel, and management changes that a major purchase is going to require of them. Most of the time, prospects negotiate on price because it’s the easiest way to mitigate the inevitable costs they know they’re going to pay on the back end.

If you can show the prospect the value on the back end, prove how front and back align, discussions of price slip into the background relatively quickly. Not that the cost element ever completely goes away, only that it takes a back seat to achieving the value they’ve just discovered through the quality, strategic insights you’ve already provided.

It’s absolutely cliche, but one of the things people most often ask me when I’m consulting is, “What’s the #1 thing I can do to make more sales today, tomorrow, and next week (as opposed to next month, next quarter, next year)?”

Usually they ask thinking that I’m going to give them some killer pitch or closing tip, some bit of wisdom that will totally transform their sales process, or maybe something that’s going to magically get them dozens of easy prospect referrals.

And it may be just as cliche as the question it answers, but the #1 reason for sales under-performance is poor marketing and target strategy.

As I’ve said before in my “15 Time Wasters of Inside Sales and Marketing,”

“A poor marketing strategy will lead your company to make costly mistakes, select the wrong market, or fail to reach the right target audience. While executive management has the primary responsibility of defining the sales and marketing strategy, every VP of Sales, Sales Manager, and Salesperson should ask him or herself:

What battle should we be fighting?”

I recently heard a quote that states, “There’s nothing so useless as doing efficiently that which should not be done at all.”

Without the right strategy, it doesn’t make a lick of difference how professional your pitch and collateral are, how fine-tuned your demo and closing skills are. If you’re harvesting the wrong field, it doesn’t matter how hard you worked to plant it.

Successful strategy starts with:

• Defining the core message.
• Defining target decision makers.
• Identifying the #1 pain you address for prospects.
• Defining your most relevant competitive advantage: price, speed, quality, or service.
• Finding the single coolest, most powerful stance you can take in your market.

Every semester for two years while teaching college composition, I used an excerpt from the movie script for Jerry Maguire to emphasize the key point of writer ethos.

Classically defined, ethos is the persona, or appearance, of a writer or orator to their audience—the words they chose, the emotional voice and tone, the sense of authority the speaker projects.

Parts of the film haven’t aged well since the mid-’90s, but there’s an essential essence that still resonates, a part of the human experience that it manages to capture. The movie at its heart wasn’t a story about sports, or even love; it was a story about a human being coming to realize the power of humility, self-actualization, and integrity.

The metaphor for the entire film becomes Jerry’s journey to Kinkos at 3:00 AM to make a hundred copies of a mission statement he had just written because he knew, KNEW that it was that damn important, and that he’d never be able to look himself in the mirror again if he didn’t do something about it.

The story rings true because we recognize something about the character in ourselves; the person who sees that the real path to success lies in everything that they aren’t.

And for some reason, even in the midst of the Digital Age Sales 2.0 world, we still haven’t gotten the message.

If the metaphor for Jerry Maguire is a 3 AM trip to Kinkos to save our souls, then the metaphor for the public’s perception of the professional sales industry is a used car lot huckster.

Why do we struggle so badly at implementing the customer-centric changes we know are vital and necessary to getting the results we want?

The evidence is real and compelling that frankly, we’re still not “getting it.”

The Bridge Group states that barely 50 percent of professional sales reps are meeting their quotas, while quotas continue to go up.

Sales cycles are lengthening. Buyers take more time to decide.

The number of “touches” to reach and close a sale are up.

Propelling Brands says that less than 10 percent of companies have the right people and processes in place to make the changes Sales 2.0 requires.

We all know the drill: “Sales 2.0″ means that the power within the sales cycle has fundamentally shifted from the seller to the buyer.

Yet we’re lagging to implement the needed changes. Clearly, Houston, we have a problem, yet “we the collective sales industry” still have our thumbs up our . . . well, you get the picture.

I work for a company that makes sales software tools to improve rep performance. And having worked here as long as I have, I’ve seen first hand the impact they can have on company’s bottom line.

Yet more than anything this industry still needs a massive shot of its most essential ingredient:

Integrity.

It’s time to stop playing the game.

We can’t change every snake oil salesperson on the planet—but we can convince our own clients that we have their best interests at heart, and more importantly, we can believe it ourselves.

Our prospects are watching our every move. Our ethos. How we talk to them. Our attitudes toward them and our work.

How do they see us? How do we see ourselves? And how do they think we see ourselves?

Hero or villain? Confidant or rogue? Self-interested power broker or trusted advisor?

Trust-based selling is a two-way street. It means means the buyer trusts us to act in their interests, and the seller trusts that the buyer is going to respect the seller’s product and process.

As The Trusted Advisor’s Charles Green states, prospects don’t need us to help them make a “rational decision”—they need to feel comfortable with the rational decision they have to make. A buyer doesn’t want to “know everything” about our product or industry, they want to trust that we know enough to have their best interests at heart.

When our message and our ethos align, closes happen.

If we’re going to improve sales performance, create better management strategies and sales processes, it has to start with managers and reps recognizing that the goal is no longer to provide information (and subtle pressure to close). It’s to provide knowledge, insight, and understanding.

And until we get that and implement it, we might as well all be selling used cars.

Heaven knows General Motors has a lot of them to go around these days.

Occasionally we get asked by a new client implementing our sales management system, “So we’ve got our lead generation team set up and ready to go, but who should they be reporting to? The marketing people think it’s them, but the sales managers think they’ll get more out of it if they’re in charge. So who’s right?”

In our experience, the answer’s pretty simple: Sales is in charge of lead generation, not marketing.

I realize this is heresy in some marketing circles, but in B2B sales, it’s the truth.

There’s two primary reasons for this:

1. Marketing is passive and lead generation is proactive.

My boss Ken Krogue tells a funny story about this from a few years ago when they attended the Omniture Summit conference in 2008. They were in a group forum discussion, and the marketing people kept raising their hands and asking, “Aren’t you sales types being too pushy with your leads?”

The short answer is no. Branding, lead nurturing, media ad buying, and passive conversion from existing channels involve much different processes and mind sets than outbound lead generation. Lead gen is about active pursuit of new opportunities. The mind set of tip-toeing around prospects is counter-productive to lead gen teams.

Bottom line: sales gets it in this instance, marketing doesn’t.

2. Lead generation metrics are more appropriately tied to the sales process.

Almost all of the work done by lead generation teams plays into a sales, rather than a marketing mind set. Calls. Collateral. Appointment setting. Demonstrations.

Other than lead source and campaign ROI, none of the metrics of lead generation make any sense within a marketing-oriented process.

Marketing and sales should be aligned, targeting the same core markets, and working in harmony to deliver the right message to the right prospects—but bottom line, B2B lead gen should be the sales team’s baby.

I recently bumped into a compelling article on Sandhill.com about the 10 Laws of Being “SaaS-y”.

Though written in 2008, the piece is a brilliant strategic blueprint for long-term management of an SaaS company, written by Byron Deeter, a key executive with Bessemer Venture Partners.

Byron has worked in the SaaS space since it first came on the scene, and serves on the board of a number of current SaaS companies, most notably Eloqua.

The Ten Laws:

1. Key metrics are Contracted Monthly Recurring Revenue (CMRR) and cash, not “booked” sales like with premise-based software solutions.
2. Keep the sales team small (3 or fewer) until reps are consistently hitting $100k in MRR.
3. Separate “hunters” and “famers.”
4. Creating active channel sales partnerships is difficult. You’re going to have to sell direct for a long time.
5. Stay local (a.k.a., North America) until you hit $1 million in MRR.
6. Don’t use multiple data centers until you absolutely have to.
7. Tenant-based installations = a big no-no (there’s one production code base, and you control it. Period).
8. Savvy online marketing is vital for leads and sales.
9. Cash on hand vs. growth is going to be a constant trade-off.
10. SaaS generally requires a 4-year allotment of “growth capital” to get off the ground, so pace spending and expenses.

**Bonus Item: You can reasonably ignore any one of items 1-10, but if you’re missing two or more, it’s probably time to re-evaluate how you’re running your SaaS business.

This summary hardly does the post justice, so go check it out here.

The two most interesting points to me (being focused primarily on sales) were #3 and #4.

Item #3—Just as Byron describes, we’ve found that having back-end account managers to “farm” current clients and keep them up to speed is crucial. Part of it has to with the nature of SaaS itself. SaaS means constantly updating your software, and adding features that create more value, and without actively getting that information to clients, you’re losing out on potential revenue. Our dedicated account management team has meant huge dividends, and especially for the fast pace of SaaS, it’s impossible to expect a “hunter” sales team to work in both roles.

Item #4—InsideSales.com has run directly into this problem since nearly the beginning. For several years we had a channel sales VP, Troy Fullmer, who is one of the most engaging, power-packed, action-oriented executives you’ll ever meet, and one of my favorite people I’ve ever worked with—but just as Byron describes, we had a very hard time putting him to use effectively. The whole point of SaaS is that users are actively avoiding having to work with “go betweens,” and to this point in our company’s existence, channel sales partners seem to add more overhead without adding much value.

I’m not really sure when or where I first heard the Internet meme of “that guy.”

“Hey, don’t be ‘that guy,’ okay?”

“You’re acting like ‘that guy’ right now, dude.”

At some point, everyone on the planet has met “that guy”—and on at least one occasion we’ve probably been “that guy.”

(Before continuing, I realize that the phrase “that guy” could be construed as being sexist. In truth, “that guy” and “that girl” can be interchangeable in most situations, but for the purposes of this article, I’m going to stick with just “that guy,” because A. it’s easier than saying “that guy/girl” all the time, and B. let’s face it, the syndrome of “that guy” is waaaay more common than “that girl.” Men are just normally bigger jerks than women, end of story. So, if any women out there are “that girl,” my apologies for not including you here. Feel free to add your voice to the comments expressing your displeasure.)

“That guy” is the person at every party you’ve ever been to who’s just a little too drunk, a little too obnoxious, a little too needy for attention, but is too self-absorbed to realize it.

“That guy” is the person in front of you in line at the supermarket who takes 27 items to the 20-items-or-less checkout, waits until the last possible second to pull out their wallet, realizes that they don’t have their credit card and are 3 bucks short in cash—yet after all this expect the cashier to just “let it slide this once.”

And maybe it’s the narcissism, the hubris, the general ability to have confidence when it’s not really warranted, but sales has attracted its share of “that guy” sales reps over the years.

We’ve all met them. The ones where “What’s in it for me?” isn’t so much an attitude as it is a way of life. The ones that cherry pick all the best leads, only make three halfhearted call attempts before giving up, then wander down the hall to whine to the VP of marketing / sales about how “All of marketing’s leads are crap.”

“That guy” closes a sale with an impossible-to-meet time frame, then washes their hands of it when the implementation team comes screaming.

“That guy’s” sales performance is on the average reasonably good, but inconsistent. He’ll do enough work (and get lucky enough) to get to the top of the charts once every other quarter, but most of the time is mired in mediocrity. They’re never good enough promote to management, not bad enough to fire.

“That guy” walks the walk just enough to be able to point out to everyone just how much he’s “walking the walk.”

Why is trust-based selling so difficult to achieve these days? Why do we keep hearing the mantra of “The customer is in charge now,” but progress barely creeps along? Why do the same best-selling sales books stay on best seller lists?

Because people rarely change. Because “that guy” syndrome is difficult to break.

And the biggest danger of all? When “that guy” syndrome completely overtakes an organization, and becomes “that company.”

You know. “That company,” the one that’s always late paying invoices, but has an endless stream of excuses why. The one that finds every possible loophole in warranty and service level agreements. The one that’s always over-promising but under-delivering, yet management wonders why the marketing spend has to go up every year just to stay on even ground.

As so many industry pundits and branding leaders have said, the problem with “that company” syndrome is that it’s a vicious cycle to break. One decision leads to another, suddenly finances are tight and pipelines are squeezed, so what happens? One more compromise down the slippery slope.

Ultimately, “that guy” syndrome usually ends in one of two ways. Either someone calls them on it, and they shape up, or they totally implode. In companies and sales organizations, it’s no different. There’s no secret formula for changing “that guy” syndrome other than self-awareness, and commitment to a truly customer-centered culture.

When people ask us the best technologies to use to get more leverage for their sales teams, our first response (purely out of self-interest, obviously) is, “A lead management CRM and a dialer.”

After laughing a bit at our shameless self-promotion, a lot of them will follow-up by asking, “Anything else?”

It’s not a comprehensive list by any stretch, but here are a few things our own sales team uses to increase their productivity.

1. Docusign for e-document digital signatures http://www.docusign.com

We discovered a while ago that paperwork is a huge time-waster for most sales organizations (see Ken Krogue’s “15 Time-Wasters of Inside Sales and Marketing” for details).

A digital signature service cuts down the hassle of re-faxing every form each time a contract gets updated. Simply update the digital document, upload it, and have the client sign on the (digital) bottom line.

2. Third-party lead providers

Not every industry can get the same level of results, but opening an account with one or more companies that provide relevant sales leads can be a way to boost opportunities. Our own marketing efforts have cooled somewhat on this lead source lately, but over the years hundreds of our clients have had success with them. As long as you’re willing to consistently monitor how well each provider is converting and selling, this can be a great benefit to a sales team.

3. Flexible sales collateral

Technically it’s not a single “technology,” but creating manage documents that can be quickly re-applied and re-appropriated for multiple situations is a huge time-saver. A really sharp-looking product brochure is great–but if it’s only available as a PDF, you have to completely re-design it for the Web. Use Web-ready technologies and templates to create as much of your sales collateral as you can.

4. Digital faxing

Digital faxing is useful in two different ways–one, it’s a great change-up for sales collateral (if you can get permission to send faxes to prospects, it creates great synergy with calling and voice mail), and two, it’s much more efficient. Why go through the hassle of printing, faxing, and waiting? All of our reps have the ability to send faxes directly from within the InsideSales.com system, and it’s a huge cost and time saver.

Tuesday’s Sales Performance Thoughts:

1. Don’t get too cute in your sales presentation.

Your product and value proposition should largely be enough to get a close. If you’re having to get “creative” to “find the pulse” of your prospect, take a hard look at just how qualified they are. If your marketing team is generating leads that consistently require a song and dance just to get an appointment, it’s time to start evaluating some new lead sources.

2. It’s better to make a decision that’s “good enough” and go with it than to agonize (and waste time) over making the perfect one.

Like most things, “careful thought and analysis” is useful in moderation, not in excess.

This concept has served me well over the years. You can always adjust plans on the fly, but it’s pretty hard to accomplish much with your backside stuck to the bottom of your chair.

3. There’s ultimately only two obstacles to success: stuff out of your control, and stuff people do.

Budgets are out of your control. Either a prospect has the money or they don’t. But what if you could get a prospect to rethink how the budget funds are allocated based on the value you show them?

4. When people fail to execute a given course of action, it’s usually for one of three core reasons:

1. In their minds they’re still deciding over whether it’s really the best decision (out of fear, lack of information, lack of experience, lack of perceived value, etc.).
2. They don’t know how to implement it.
3. They’re actively sabotaging it for the sake of their own personal agendas. This can be as extreme as Enron-level fraud, or as simple as employees surfing the Web on company time “because they think they deserve it.”

5. It’s not always the case, but sometimes consistency trumps performance.

My sales metrics friends and gurus at The Bridge Group are constantly evangelizing the fact that sales teams should rarely be over or under their quotas by more than 10%. Massive over/under numbers in sales forecasting means either managers and reps are sandbagging, or the company isn’t getting good sales data.

Question: What do the names Eddie Johnson, JJ Redick, Trent Tucker, and Craig Hodges have in common?

Answer: They’re all NBA basketball players who were able to have successful careers primarily by being proficient at one thing (and not much else):

Making three-point shots.

These were players who realized that the highest value to their teams was to focus on what they did well—and develop as many “sub-skills” around that core value as they could.

JJ Redick will never win a dunk contest, or be considered anything more than a mediocre defender—but he has perfected the art of coming off screens, and has a lightning-quick shot release.

It’s not always the case, but in today’s Sales 2.0 World, a lot of the time it’s better to be fantastically good at one thing than to be average at half-a-dozen.

I mention this because we see a lot of companies that still treat their sales reps as “generalists,” meaning that they’re responsible for the entire end-to-end sales process (finding leads, qualifying leads, closing sales).

In our experience, when set up correctly, sales teams perform significantly better when they switch to a specialist model, where one group of reps handle inbound leads and lead generation, and the other focuses on closing sales. Specialist models provide more accurate reporting, make better use of employee time, and let the system play to employees’ strengths.

InsideSales.com isn’t a perfect company, but one of the things our managers do well is in maximizing talent. They are unafraid to shift personnel within departments, or into new departments entirely if they feel the employee has skills that could be better utilized.

Our specialist sales model plays directly into this. By splitting up the sales process between lead generation and specialized closers, we’re able to better play to our team’s strengths. It works because it lets employees focus on their most important activities. It works because we can consolidate training and mentoring to provide the best core value in their specialty. They’re not having to constantly “switch gears” between two types of activities that require largely different skill sets.

While the initial investment in time and process is higher, “specialist” models generate more qualified leads, have higher contact rates, and develop more legitimate sales opportunities that ultimately produce more sales.