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September 2010

Slate Magazine Predicts the Demise of Salespeople Part II

The author James Ledbetter wrote a story in Slate magazine about the Death of a Salesman. Of Lots of Them, Actually.

The article concluded with: “The strength of sales jobs is that they can be reasonably high-paying but typically don't require technical training or other specialized skills. When those jobs disappear, the people who hold them will often be pushed down the wage ladder or even out of the workforce. Sixty years after Willy Loman, that is our tragedy.

Read what well respected sales leaders had to say:

Craig Jones, Vice President of Sales and Marketing, ADS Americas
 
James-head "I think that it is indicative of the great uncertainly that is currently gripping the market.  As companies decreased production in 2009 to try and increase scarcity of product, sales forces were reduced at rates equal to or less than their manufacturing coworkers.  As the reduction in surplus is taking effect and confidence is building in the market demand for goods and sales people to fill those needs IS increasing.  Salespeople are the engines of growth and once senior business leaders see that the recovery is more than short term, hiring will increase and good talent will be in high demand.  We are seeing that in our business as we are going out in the market to recruit management talent to help drive our growing business.  The less people hear about bad news the more consumers will begin to demand products and companies seek sales people to fill those demands.  Market segments will be effected unequally and some markets (housing, automotive, luxury goods) may take a decade to recover to 2008 levels. I am very optimistic for the future."

Mark Roberge, VP Sales Hubspot
 
Roberge-head "Great article Gerhard.  I especially like the point about the disruptive effects of the Internet.  The Internet has shifted control in the sales process from the seller to the buyer.  A decade ago, a buyer had to interact with a sales person to get the information they needed.  One could be "in sales" if you simply memorized a product sheet, mastered a PowerPoint deck, or knew how to process an order.  Thanks to the Internet, buyers can accomplish these tasks online and prefer the experience over a "pushy" sales person. 
 
Today, a sales person needs to add value to the buying process by being an expert in their industry.  They need to understand how to build trust with a prospect, understand the prospect's unique pain, and work with the prospect on potential solutions.  Sometimes that may even mean recommending an alternative product if your company is not the right fit.  At a recent conference, I heard a great quote that sales is no longer about Always Be Closing but instead Always Be Helping.  That was a smart comment."

David DiStefano, President, Richardson
 
Distefano-head "Although I don’t believe the “salesman” is an endangered species by any measure, it is undeniable that the internet has forever altered the landscape of buying and selling.  As such many sales roles/people have become “commoditized” and will continue to struggle to adapt to this new world we live in. You might ask what I mean by “commoditized” sales roles. As the author pointed out, sales roles typically don’t require technical training or other specialized skills and in today’s internet dominated society and compounded by the severe global recession, a large number of sales people who relied on personality or charisma find themselves ill equipped for success and have suddenly become a replaceable commodity. On the flip side, the opportunity for sales people and their employers is to recognize the importance of “specialized skills” that are essential to succeed. The combination of deep personal conviction, the desire to help customers succeed and an advanced mastery of critical selling skills including listening and questioning and an appropriate level of business acumen are in fact “specialized skills” that when demonstrated at the highest levels led to success that is not replaceable. So in fact, although the professional of selling does not require formal education per se, it does require the refinement of these specialized skills each and every day."

Clint Fairweather,  Director, Organizational Effectiveness, SunGard Financial Systems
 
Fairweather-head "Interesting piece.  If the author believes that sales professionals hold the “middle”, I couldn’t disagree more.  With development and skills training, a sales person not only gets better at their current job, but will most likely excel at higher levels."

 

 

Jim Dickie, Partner CSO Insights
 
Dickie-head "The cases the article cites regarding car salespeople and pharma reps, are two examples where sales forces were created to primarily share "product" information with clients. The Internet is taking over that task and is very attractive to buyers for two reasons; first it is available 24/7, second customers can access information without talking to a rep unless they are ready to do so. Will this cause some of those jobs to disappear? Yes, or it may cause them to evolve.
 
There are other types of sales people who are in place to share "problem solving" information. A property and causality sales rep's main role is to help clients wade through a vast array of potential coverages to find the one that mitigates the risk most effectively for their customer. An HP or IBM reps value add is helping clients determine the most effective ways to leverage technology to solve business problems. In areas like, telecomm, professional services, oil and gas exploration, etc., the role of the rep is evolving from selling a product to helping clients co-create a solution.
 
If I had written the article, I would rather have said the product rep may be on the verge of extinction, but selling as a profession is not. If I bring a new product to market it would be foolhardy to think I was going to be successful simply by having my computer talk to your computer. Rather I need to focus on my solution specialist talking to your problem specialist."
 

The profession of selling keeps growing

The fact that selling is quickly becoming a profession is evidenced by the growing number of University Sales Programs. The following universities teach a minimum of three professional sales courses. These universities offer sales internships and they are a prime target for companies who want to recruit well educated sales professionals.

Ball State, Baylor, Bradley, California State, Central Michigan, College of Saint Catherine, DePaul, Florida State, Georgia Southern, Illinois State, Indiana, Kennesaw State, Michigan State, Missouri State, Nicholls State, Northern Illinois, Ohio, University of Akron, University of Arkansas, University of Central Florida, University of Connecticut, University of Dayton, University of Houston, University of Louisville, University of Nebraska, University of Toledo, University of Washington, University of Wisconsin Eau Claire, Washington State, Western Carolina, Western Kentucky, Western Michigan, Widner University, Weilliam Paterson University,

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Slate Magazine Predicts the Demise of Salespeople Part I

Ledbetter

 

 

 Last week, the editor of Reuters.com, James Ledbetter shared his belief that salespeople are an endangered species. Take a look at the article below.

 

 

Slate-shot

If you read this article carefully you’ll find that Ledbetter first argues that “salesmen” are disappearing and this seems to be the reason why America’s economy is suffering. I think that this line of reasoning is nonsense. First, we should stop using the word salesmen. If you advertised jobs for salesmen, you’d be sued for discrimination.  Second, the decline of America’s economy hasn’t been caused by the loss of sales jobs. The economic decline was caused by bankers who turned into gamblers, enabled by a lack of regulatory oversight. That decline lead to the loss of jobs across all sectors, including sales. 


Mr. Ledbetter is an accomplished journalist who has written several books.  What strikes me as odd is his fascination with death and depression.  He wrote the book, The Death of Public Broadcasting, and co-authored a book on the Great Depression. His Slate article closes with this death-march drum beat: “The strength of sales jobs is that they can be reasonably high-paying but typically don't require technical training or other specialized skills. When those jobs disappear, the people who hold them will often be pushed down the wage ladder or even out of the workforce. Sixty years after Willy Loman, that is our tragedy.


I don’t think the profession of selling is headed towards tragedy. On the contrary; the profession of selling is going to meet with greater opportunities than ever before.


I asked a number of people whose opinions I trust to comment on this article.  Take a look. Read them and share your comments.

Michael Weening, VP Sales Bell Mobility
 
Weening "It has been proven time and time again, that people are more likely to buy from people that they like or have a relationship with. Companies simply need to do the math: When the value of the sale is matched with an increased probability of volume, due to persuasion, and it makes financial sense, then the salesperson will remain in the equation. If the value of the sale is so low, or relationship does not play a part in the purchase, the salesperson will be cut out. Simple.”

 

Ken Powell, VP World Wide Sales Enablement, ADP
 
Powell "This transformation is consistent with the greatness that has defined the American economy for hundreds of years.  The advent of technology its adoption into mainstream business has driven changes and necessary adaptation of the American worker.  Those who used to farm had to adjust their skills to work in factories.  Factory workers had to modify their skills to sit behind a desk.  Desk workers had to move from pencil pushing to thinking and now thinkers have to adapt to be innovators.  Unlike the sales person who pushed product, persuaded buyers and closed business, as a result of readily available product specifications and information on the Internet, the new sales person has to be a change agent.  The sales person of this next century will sell perspective and ideas, not products or even solutions, so like every other transformation that the American, and now global worker has encountered, the new era sales person has to adapt, change and find a new way to bring value."

Emmanuelle Skala, VP Global Sales Operations, Sophos
 
Scala "I think the article is dead-on.  The interesting impact that he doesn’t really delve into is B2B.  While I don’t have the statistics on the number of sales people in B2B dropping what I can tell you is that it is much harder to create demand.  Demand is already created before you ‘get to the dance’.  The typical sales process of “Discovery” -> Solution Mapping -> Solution Validation no longer works because buyers are coming to us during their “Evaluate Options” stage of the buying process (post Need Development).  And when they do, they won’t want to go BACK to discovery/need development where they have to re-hash to the sales rep why they are here.  In their mind, they have done the research, they have developed the need and now they just want to see the product. 


Sales reps need to understand where the buyer is and meet them there.  Going into Need Development when they come to us in Evaluate Options is counter-productive and will turn away customers and perpetuate the myth that ‘sales reps don’t listen and don’t understand me’. 


At Sophos, we teach what we call the “Stage 4 Rewind”.  (Our stage 4 is Solution Validation).  The Stage 4 rewind teaches reps to work backwards with the customer instead trying to start from the beginning.  For example, a prospect comes to us and says “I have a need.  I’ve done my research. I want to evaluate you and 2 other competitors”.  Instead of peppering them with questions on what their pains are (essentially taking them back to the beginning of a normal selling process), the rep should engage the prospect where they are (in this case they are thinking PRODUCT) by asking them “what type of solution are you looking for?  What does your ideal solution look like?”  Then follow this up with “Why does it need to do that?” Then follow up with “What benefit would that provide to you”?  Then follow that with “Why is that important to your business?  What pains does that solve?” etc etc.  Working backwards from Product/solution to pain versus jumping right to pain is more natural for the buyer and meets them where they are."


What do you think? Is the profession of selling doomed as Ledbetter says? Read Part II tomorrow.

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How Sales and Marketing Mastery Leads to Revenue Success

Today I had the opportunity to moderate a Webinar with Bill Binch, sales VP of Marketo, and Barry Trailer, partner at CSO Insights, on the subject of revenue success. Bill is a hands-on sales manager who has 13 salespeople reporting to him. He’s very tech savvy, success driven, and customer focused. His full title is VP of sales and customer success, which suggests that Marketo is highly customer focused yet revenue driven.

Barry, on the other hand, is looking at revenue generation from two perspectives: 1) based on his extensive research and 2) based on his personal insight into sales mastery. Here is a five-minute interview with Barry in which he shares the keys to sales mastery:




Blog-headshot Bill Binch framed the challenge of revenue generation by saying,

"The sales machine on its own is not sufficient to drive revenue growth"

In other words, sales leaders need to look beyond CRM and the sales process and ask themselves, “How is marketing generating opportunities for sales?” What struck me as surprising were the high investments Bill’s company makes in marketing. The ratio of sales investment to marketing investment at Marketo is 1:1, while the average ratio, according to Sirius Decisions Research, is 3:1. Does that mean that Marketo is overspending on marketing? It depends. We can only answer the question by looking at the company’s results. According to Bill, 60 percent of Marketo’s sales pipeline is exclusively generated by marketing. That’s about three times higher than average. But the true measure is revenue growth. Marketo is a private company; however, according to trusted industry insiders, Marketo’s sales are growing close to 100 percent year over year. My conclusion: Marketing done well pays great dividends.

What I found most unusual is that Bill, a results-driven sales hunter, is convinced that marketing can be held accountable for revenue generation. It shows that when sales and marketing are aligned within a company, salespeople begin to see marketing as an ally that is helping them capture sales-ready leads, not an adversary. In such companies as Marketo, Ariba, Sybase, or salesforce.com, sales and marketing are aligned. That’s not the case in most companies. 

The signs of misalignment:

Misalignment

 

Salespeople say to marketing:

Your leads suck! Marketing is a waste of money!

Marketing says to salespeople:

You are too lazy to call the prospects we found for you! All salespeople do is complain and entertain.

 

 

Great marketing leads to a well run sales organization

Of the many takeaways Barry and Bill shared, there are three that stand out:

  1. Companies that use lead generation management (meaning marketing automation) generate higher revenue growth
  2. Companies that use lead scoring can operate a more efficient sales force
  3. Companies that use lead nurturing run a more productive sales organization

One of Barry’s slides divided companies according to their sales and marketing process. What’s interesting is that only a dynamic process governed by greater flexibility and more insightful metrics allows a company to rise to the level of a trusted partner.

 

Comp-chart

 

The research numbers, based on a survey of more than 3,000 sales leaders, are highly compelling: Level-3 companies have more reps making quota, they win more deals, and their sales force has lower turnover. What’s the catch?

 

 

Barry said that "it’s not easy" to become a level-3 sales organization. My POV: As sales leaders, we have to make a choice between the pain of mediocrity, and the pain of mastery. It would be easy to say, no pain, no gain, but the reality is this: if we choose mediocrity, we turn into a sitting duck. If we choose mastery, we’ll be leading the pack.

The disturbing news: We prioritize customer acquisition and neglect customer nurturing

Take a moment to study these low scores:

  • a)   Improving customer loyalty (24.7%)
  • b)   Enhancing the customer experience (21.1%)
  • c)   Increasing customer renewals (17%)

Obj-hart What are we thinking? What CSO Insights’s research tells me is that companies are saying, "I want more customers (91.2%), but I don’t want to create a customer-centric strategy (13%)." This sounds like the reasoning of a five-year old who wants to have his cake and eat it, too. All I want to say is, "Grow up!"

Bill’s answer was more reassuring. Most of his customers use the software to nurture existing customers. The result: greater revenue growth from existing customers and greater customer satisfaction at a lower cost of sales.

As long as Barry continues to promote sales mastery and Bill continues to promote marketing mastery, we’ve a shot at bringing sanity and growth back to America’s economy.

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How Many Balls Should a Sales Manager Juggle?

For the past 30 years, I have had many conversations with sales managers and VPs of sales. In every one of these conversations, three key elements stand out: people, process, and technology. Every one of these elements are like juggling balls that follow a trajectory from being immobile to getting tossed up in the air only to fall down again. When sales managers are able to juggle these three balls, sales productivity soars, customer satisfaction rises, and profitability increases. To see the art and finesse involved in juggling three balls, take a quick look at this four-minute video:

 

 

The analogy isn’t perfect, but it captures how sales managers tend to feel when they think about making their numbers. While jugglers stand on a stable platform, sales managers don’t have that luxury. Sometimes they get flooded with demands from their people. Sometimes economic conditions impose unexpected cutbacks, and sometimes technology and innovation create tectonic shifts that require massive and rapid shifts in strategy.


One common complaint of sales managers is that they are way too busy to address all problems that emerge on their radar screen. Every day, one problem or another has to be ignored in order to focus on what’s most important that day. In the process, these managers carry the burden of unfinished business, and that weighs them down. The average tenure of a sales manager is 24 months. All these managers started with a great vision and strategy. But for one reason or another, they were unable to get their team to execute their strategy.

 

To succeed in sales management takes a lot more than the ability to sell, to motivate people, and to crunch numbers. Great sales managers are leaders of people, designers of process, and early adopters of technology. It is hard to develop these qualities, and CEOs have a hard time finding sales leaders with these qualities.

 

During the past seven years, I’ve conducted more than 15 sales leadership conferences that were attended by more than 3,000 sales leaders. The key questions that always come up are, “How do I create a more effective sales team? How do I create a more productive sales process? And how do I select and integrate the best technology tools to accelerate sales?”  When sales leaders from a wide variety of industries get together, an amazing exchange of ideas happens spontaneously. In these conversations, sales leaders realize that for every productivity problem within their company, there are hundreds of solutions that have been applied by other sales leaders. The sales leaders who attend these conferences often take dozens of pages of notes, and they continue their journey of ongoing learning and discovery.

 

Pathways-blog

 

On the other hand, there are tens of thousands of sales managers who don’t want to leave their office, and in the process they leave their learning to chance. Sooner or later, they run into major problems that their impaired capacity for creating or finding solutions can’t handle. These are the managers that get sideswiped by progress.

 

Many sales leaders have only small snippets of time available, which makes it very difficult for them to assess the true extent of their company’s productivity drains. And they don’t have enough time on their hands to shop for solutions.    

For those sales leaders who can’t take time out of their busy schedules, here is my top 10 sales management checklist that may help you prioritize your change initiatives:

 

Blog-top10

  1. Hire the best talent you can get. You know that the best team wins. You can’t expect sales to go up by working with unmotivated turkeys. Test your candidates prior to conducting your interview. Update your sales-job descriptions at least once a year to keep up with the changes in the market and your organization.
  2. Create a comprehensive sales process that 80 percent of all salespeople will follow religiously. Allow for a 20 percent deviation, as long as you monitor the outcome. Remember, if the process works on paper, it will work even better when it is automated. If you automate a process that doesn’t work on paper first, you will automate chaos.
  3. Give salespeople the best mobile technology tools to execute your sales process more efficiently. The right set of Sales 2.0 tools can accelerate your sales pipeline, shorten the sales cycle, improve win rates, and establish a culture of measurement.
  4. Focus relentlessly on training and coaching your sales reps. If you don’t have the resources in-house, then outsource training. Every sales manager should receive formal training as a coach. Also, create a mentoring program for coaches.
  5. Track your sales progress in real time. Create a culture of measurement. Automate forecasting. Give your salespeople access to your metrics. Show your salespeople their sales versus goals and their ranking among their peers. Forecasting accuracy below 95 percent is an indicator of inefficiency, leading to higher cost.
  6. Compensate your salespeople based on true performance. Automate the process to eliminate shadow accounting and costly spreadsheet mistakes. Reward salespeople for contributing to innovation, process improvement, customer satisfaction, and team collaboration.
  7. Prepare your sales team for the next social-media revolution. Help salespeople “listen” to their customers’ comments on Twitter. Train salespeople to use LinkedIn to get to know their customers better. Help salespeople create their own portals to communicate with their customers. Explore instant collaboration tools, such as Chatter or Jive.
  8. Align sales with marketing. Stop operating in a sales silo that’s separate from the marketing silo. Invite marketing managers to ride along on sales calls. Invite salespeople to explain to marketing managers what leads work best for them. Explore the use of marketing software to accelerate the lead flow.
  9. Create a sales-enablement initiative. Give salespeople access to all sales and marketing information, such as PPT, proposals, market summaries, customer references, pricing quotes, etc. Stop the waste created by salespeople who are reinventing the wheel.
  10. Redesign your sales approach with the customer at the center. Too many sales organizations are focused on themselves, with the goal to improve sales and profits. The future belongs to companies that are focused on the customer experience (Apple is a great example). Start mapping your customer’s journey, and measure how your organization performs at each touch point. The result: You’ll turn customers into salespeople who will help you grow sales and profits.

Bonus idea: Accelerate your learning by looking outside your company. The solutions that are readily available outside your organization far exceed the number of problems inside your company. You can’t win without harvesting the great ideas created by the sales leaders of the best companies in America. Expand your sales-leadership acumen by connecting with other sales leaders at least once a year.

 

 

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Do your Sales Sizzle or Fizzle?

What is the number one problem that stands between you and your prospect? Chances are your sales messages fizzle in the marketplace. Prospects don’t know you, your company or your product; they don’t understand your message; and they don’t care about your story or your unique selling propositions.

Back in 1888, very few people had heard of George Eastman and his little black box that he called the detective camera. Only a few people understood photography, and even fewer knew his company. He started a sales revolution with the simple and compelling message: "You press the button, we do the rest." Eastman’s sales message was as innovative as his camera.

Kodak-1

Since 1888, advances in technology have created a landslide of products and an avalanche of information. Today customers are bombarded with sales messages that they have learned to tune out faster than ever.

Ask marketers and they’ll tell you that every year response rates decline. Today, more than 99 percent of all promotional emails are ignored or deleted. Why? The subject lines are boring, boiler plate messages. Ask sales managers and they’ll tell you that 90 percent of all prospects ignore a salesperson’s attempt to close the sale. Why? Because most salespeople talk about how great the product is, but they have little understanding of how their product can enhance their prospect’s business.

Sentences-that-sell Why do most sales messages fizzle? When companies think of innovation, they think of innovative products, processes and technologies, but not messaging. What makes effective customer messages sizzle? The first author to write about selling with sizzle was Elmer Wheeler.

Wheeler’s bestselling book Tested Sentences That Sell (Amazon) was published in 1937, it revealed his experiments with sales messages and their impact on prospects. (Note that hardcover copies of this classic sell for over $100 today).

Wheeler spoke about meaty words that prospects could sink their teeth into and watery words that had little impact. The world has changed since 1937, the advances in technology have been remarkable and business has become a lot more complex, yet human nature stays the same.  For example, Wheeler found that if a waiter asked, “Would you care to order a red or white wine with your dinner?” it would double the sales of wine. Compare that with the unproductive questions that most waiters ask today: “What would you like to drink with your dinner?” Wheeler taught his students: “Don’t ask if, ask which!”

Today, customer-message management has less to do with the right choice of products than with the right choice of words. Every market has its own jargon, acronyms and buzzwords that salespeople need to know. Each prospect lives in a different world that is governed by different preoccupations, perceptions and preferences. While a CEO’s perception focuses on the future, strategy and efficiency, the CFO’s preoccupations revolve around cash flow and ROI. For a sales message to gain access to the prospect’s mind it must reflect the language of the market, the preoccupations of the prospect and the challenges of the company. If salespeople want to get a seat at the table, they need to initiate the right conversation and speak the customer’s language.

Today’s successful companies take a more strategic approach to creating and distributing effective sales messages. The new process is called sales enablement which is designed to give each salesperson direct access to the collective intelligence that already exists in a sales organization. Why should salespeople reinvent the wheel every time they need to create a proposal or prepare for a call? Why should salespeople quiz each other for customer testimonials or to find the best practice for negotiating a deal? Why should salespeople create their own laboratory for tested selling sentences? Sales 2.0 providers like Kadient, SAVO, or iCentera offer sales enablement solutions that collect the best message assets of the sales team such as talking points, white papers, conversation maps, persuasive stories, presentation videos, proposal templates, market overviews, research data, ROI analysis, customer testimonials and more – and make them instantly available to everyone.

I am sure that Elmer Wheeler would come up with a clever way to wrap this all up in one tested sentence: “Sales Enablement is the crunch in the cracker, the whiff in the coffee, the pucker in the pickle and the commission in the close.”

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Are you a Lemming or a Leader?

Lemmings

Let's say you’re looking up a word in the dictionary, and the word you're looking for is "lemming." As you flip through the pages, you stumble onto the word "orotund" and wonder what it means. You find out that it means "pompous." You then make your way to the “P” section, glance at "pompous," and find "pretentious," which leads you to "ostentatious." In the process, you forget about "lemming" altogether. The result: lots of action, brief amusements, but mission not accomplished. The cause: Lemmings get lost in thoughts.

Let's take another example. Have you ever gone to a grocery store with the intention of getting milk, cereal, and batteries and walked out with 12 or 15 items, but no milk? What prompted you to deviate from the milk aisle and pick up two magazines, cookies, ice cream, mouthwash, and a can of cling peaches? The cause: Lemmings get lost in action.

A third example may drive the point home. Have you ever sat down in front of the TV just to relax for a few minutes and found yourself clicking from one channel to the next? Two hours later, you realize that you’ve watched dozens of programs that you were not interested in, and you’ve seen dozens of commercials that all melted into a blur. The cause: Lemmings get lost in images.

As the world grows in complexity, there are more chances to get lost in thoughts, action, and images. Lemmings act like children riding on a rocking horse – fully engaged, always in motion, but going nowhere.

The key characteristic of a lemming is that he or she follows the crowd. Lemmings pursue the path of least resistance, which has been created by millions of footprints left by Mr. and Mrs. Average.

Leaders, on the other hand, are aware of the impulses that lead us to run in place. Leaders know that technology can create chaotic minds (just watch people as they stare at their cell phones and walk into lamp posts). Leaders know how to avoid the path created by lemmings, and they confidently build their own road.

Heavyweight boxing champion and grill salesman George Foreman once told Selling Power that "success begins with a decision." If you set your mind to reaching a goal, you'll make certain that you reach it. You'll say no to all distractions, detours, and time-wasting activities. As a result, you’ll clearly focus on reaching your destination without detours. The decision to be successful helps you to develop an internal guidance system that keeps you moving upward and onward.

Think about the dreams you had 10 years ago. What happened to them? What about the five-year goal you set five years ago? Where did it go? Where did you go? What about today?

Sylvester Stallone once reflected upon his own success, saying, "I am not the smartest or the most talented person in the world, but I succeeded because I kept going and going and going." Stallone had a rich history of failing, something lemmings try to avoid at all costs. Leaders prepare to tread a straight path to success, a destination that lemmings dread because they are afraid of failure. When faced with conflict, leaders seek solutions while lemmings seek comfort. When they come to crossroads, leaders follow their compasses; lemmings follow what’s convenient. 

What is your vision for the year 2020? Will you be a leader or a lemming?