Sales | No Smoke and Mirrors

Add Inside Sales…Fix Sales Problems

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by Mark Allen Roberts

In my last post I shared how salespeople need to learn their A B C’s in terms of account segmentation to insure their salespeople are spending time in areas that match your sales plan and insure sales goals are achieved. Nothing drives your CEO crazier than finding out your sales team is not hitting plan, and six months into the year he discovers sales is not executing the go-to-market plan everyone agreed to follow. One way I have used to insure sales teams execute sales plans is the implementation of inside sales. The first reaction I always receive when presenting inside sales is:we can not afford it. My answer is always;

You Can Not Afford Not To Have Inside Sales to Hit Sales Goals

In this post I will share my thought process on why inside sales is even more critical in today’s selling environment than ever before, how inside sales can turn cold calls into warm calls, increase sales with your C accounts, increase new customers, and reduce your current cost per sale and add more profit to your bottom line. Inside sales also offers a number of other benefits we will discuss, but I hope the above mentioned benefits are enough to keep you with me.

How has the sales environment changed in the last 5-8 years?

I used the same process I would use in a market trying to determine shifts, I interviewed a number of sales people and listened to what they are experiencing selling products in today’s market. Some of the common comments included:

My buyers have to justify each expenditure to the “higher ups”

C-level executives need to sign off on all orders

About 70% of what marketing gives me I do not use.

I have to speak with all kinds of people I never had to sell before; CTO, CMO, CEO, CFO…

Customers are not stocking up and they are taking much longer to buy, while our marketing programs try to reward customers to buy volume, but they are buying Just In Time

My buyers have the C-suite recommending competing vendors to our products and my buyers are spending time chasing these leads the C-suite read about or heard about at the country club…

My buyers say they are “cautiously optimistic” about our economy and therefore are not cutting Purchase Orders

Couple some of the above with the studies that indicate 70% of buying is occurring before the buyer makes contact with a salesperson even the most adamant skeptic must agree buyers are buying differently today and the sales process must adapt if you plan on hitting your sales numbers.

Inside Sales can turn Cold Calls into Warm calls

In addition to staying in contact, touching, your C Accounts, inside sales can establish trigger alerts through Google Alerts that give them a heads up when a trigger event occurs that may indicate a sales opportunity. For example, let’s say a manufacturing plant expanding has been proven to be a trigger event for turning suspect customers in to prospects and even quotes. Inside sales can establish a limitless number of Google Alerts to let them know when a trigger event occurs in the market. Your alert would look something like; “Ohio Plant expansion”. When that alert is triggered inside sales can search Linked in by company, make phone calls and send your product information to the right person ant the right time. Marketing should provide template tools to insure the communication connects to possible buyer pain points for this type of buyer by market. If the alert is for one of those large accounts, in your market sweet spot you have wanted to sell, inside sales will send information and make contact then introduce the field sales person. A common transition would sound something like ; “ as we have discussed it sounds like you are exploring products to support your plant expansion, we have our product specialist in your market on September 15^th, would you like me to set up a time for him to meet with you and better understand how we can help you? “ I recommend providing inside sales a finder’s fee bonus on accounts they feed to outside sales that turn into orders. I often use some % of the first order’s profit.

Increase sales with your C accounts

Working with the VP of Sales and marketing you can establish strategic touches. Some that I have used include;

“thank you for your recent order, people who purchased ____have also purchased _____”
“I noticed you have not ordered since __________ and I wanted to check in on you”
“You asked to be kept in the loop on new products, did you see our _______ click the link in this email and it will send you to product information”
Promotions – I recommend a quarterly product focus, and have inside sales send an email and within 7 business days call to follow up, “did you see we are running a promotion on _______”

The key focus is service not sales. Inside sales tone and voice should be about helping the customer. All communications must feel relevant to your buyers and timely. When I say timely I am referring to communications that feel like they came just when the buyer needed them, like you know them.

Increase new customers

As we discussed above, inside sales will be constantly being alerted to triggers that may lead to new business. In addition, now that field sales have only A and B accounts, they can work the targeted accounts in their market opportunity profile.

Reduce your current cost per sale and add more profit to your bottom line

What does it cost your company to have a field salesperson call on an account? For years I have used $500 as the cost of a call, but it may have gone up. You need to add the salesperson’s base, expenses, medical and all overhead to determine a cost. I have heard some people tackle this different way by having a daily cost of a salesperson model. Whatever you use, there is a cost. What is the cost of losing a key customer? The cost of losing a C account? What does an inside salesperson cost? In most cases their targeted compensation is 1/2 that of a field salesperson, and their only expenses are added phone calls and postage.

If you do not have inside sales today, I recommend a phased approach with regards to field sales commissions. In some cases, which will be an eye opener to many, the C accounts are the vast majority of your field sales commissions. Let me say that again in a different way; the majority of the commissions you are paying your best and brightest field salespeople who are not growing current accounts or opening targeted new accounts would have probably come in anyway, even without a field salesperson. I often implement a split commission structure in the first year as we transition to inside sales and this gives field sales time to refocus and not realize too much of a hit on their targeted compensation in year one.

Inside sales helps focus on creating the greatest return on sales investment

Quick numbers…. Let’s say your field sales team member is costing you $700 per day. Let’s assume, because the field sales person has time to work current customers they increase their base key account sales by only 3%. Let’s also assume you reduce your account attrition by one key account per territory, and the salesperson only opens 4 new key accounts per year. In addition, as I experienced personally, your C accounts are now feeling you care about them , that they are important , and you are reaching out frequently with solutions to problems they were surprised you knew they had and C account sales grows over 10%. Inquiries from the internet speak to a live person and have their questions answered quickly and all inquires are treated like they could be customers. Your cost to support C accounts has decreased by 50% increasing your ROI on sales compensation invested…..I’ll say it again ;

You Can Not Afford Not To Have Inside Sales to Hit Sales Goals

The last benefit I also realized from inside sales is it often becomes your farm team for field sales. Your inside salespeople gain valuable experience often dealing with some of your most demanding customers. They learn your product lines and the problems they solve, your markets, and as your team grows often they can be called on to serve in a field sales capacity. They also learn to rely on the buying process you have taught them and when they venture out into the market follow it because they have experienced how having a sales process that mirrors how customers want to buy drives sales results.

So how about you…do you have an inside sales model?

What benefits have you realized from having inside sales?

What do you do strategically to insure inside sales and field sales work well together?

Given the shifts in how buyers are buying today, an inside sales position is key to insuring your sales team makes quota.

How Understanding Your A B C’s is the first Step To Driving sales growth …

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How Understanding Your A B C’s is the first Step To Driving sales growth …

As leaders of sales teams what do we all have in common? We all want to have our team hit their sales numbers and we want to insure our teams are working the sales process to insure they are creating sales velocity. However when we travel with sales people making sales calls it often becomes apparent they need help prioritizing their time to insure the sales plan is met and or exceeded. One of the best ways to increase sales today while filling the sales pipeline is helping your salespeople understand their A B C’s.

I remember working with a salesperson and we were out making four legged sales calls. My goal was to mirror this guys for a few days to determine how he spends his time, what he feels his job is and how that compares to the companies expectation and overall assess why we can’t seem to open net new customers in his region. Here is what I observed;

we called on accounts who were already customers and they were all very happy
the accounts we visited with included one large customer and a number of small customers
we did not call on any new accounts ( although we drove by a number of them as we worked his bread route)
the salesman was excellent in what I refer to as the “no smoke and mirrors approach”
I asked how many accounts he had in his area of responsibility and at first he was not sure , but later said “ I think I have around 1500 customers”

On the one hand, if our time together was any indication of how all his customers feel, he probably has a number of very happy customers who value his approach and experience. I asked him how he can serve so many accounts. And he quickly replied “it’s really hard but they love me because I treat everyone the same…big or small I give them all the same amount of attention and I think that’s why they are loyal to me.” However it quickly became apparent why this region was basically flat in sales and not opening net new customers: this rep did not know his A B C’s.

Let’s take a little deeper dive into this situation.

In reality he had 986 customers, and was not touching all of them every year

Average number of work days in a year: 251

Holidays, vacation days, sick days: Approximately 30

So this salesman has approximately 221 days to see 986 customers

To just see his current customers once per year he would need to see 4-5 per day, every day without any extracurricular activities (ECA’s) getting in the way (and that’s a whole other blog post waiting to happen)

In addition part of his responsibility is to reach out to 2-3 net new customers per week, but we discovered that was just not happening.

My next step was to work with the VP of sales and shared my findings and wanted his feedback. He said he never looked at his sales regions like this before and wanted to know what I would do. Very quickly I said we will establish A B C’s for this region.

A Account

This is a list of top producing revenue accounts you currently have in a region who you suspect will be buying more products and services from you. Most people sort it by sales history descending, and often add accounts that you are currently selling, but could be buying quite a bit more with some attention. I always add new target accounts in the market you are not selling but have similar characteristics to accounts you serve today and probably have similar problems like those you solve for your current accounts every day.

B Accounts

These accounts are in the middle of the road, revenue wise, accounts that you have sold, continue to sell, but you do not see a huge sales growth potential in. You obviously value their business and you want to insure they are happy and continue to be loyal to your company. If one of these accounts grows and they often do, you want to be there when they become an A account. If this list is not too large I may add other new account targets, often based on proximity to current customers, but would not be considered to be one of your core markets.

C Accounts

These are the smaller accounts revenue wise but often take the greatest amount of your salespeople’s time. When something goes wrong with this customer type all hell brakes lose and they expect your salesperson to drop everything and help them. They may have once been large accounts who now only buy small amounts due to downsizing or some other shift in their business. These may be small mom and pop customers who again you want to serve and make happy fans, but their overall future sales opportunity is limited.

I usually have everyone agreeing to this point and then everyone’s mood changes with the next question….

What is the best way, from the customer’s needs perspective, to serve them?

This is where the sales guys immediately get nervous and argumentative. In reality they are not arguing with what I am about to say, but more with what they perceive the personal impact will be in their compensation. Sometimes I have sales VP agree up to this point but fail to execute any changes because it feels like a lot of work sorting through accounts. If you have been in your market for more than 10 years it could be a large undertaking. So I share a quick way I have used that is not too scientific but results in the desired new customers and sales growth we are looking for.

A B C Account segmentation according to Mark:

Print the salesperson’s account list , sorted by customer in sales descending
Draw a line about 1/3 of the way down through the list of accounts
Everyone below the line is now a C account
In the 1/3 of accounts above the line, draw a line ½ way through this number of accounts
everyone above this new line is now an A account and everyone below the new line, but above the 1/3 line is a B account
Gut check step – sales VP and salesperson review B and C accounts and make sure none should be A’s based on opportunity, if so add them to A list

Let’s get back to the salesperson I was working with…so out of 986 customers (who he really was only touching about 400 per year anyway) now 740 are considered C accounts and 123 are now A accounts and 123 are B accounts.

How do we work our A B C’s?

A Accounts

These accounts will be seen frequently to add the most value without being counterproductive to the sales process. In this market we identified over 60 new target accounts in this companies’ market, sweet spot that are like those they sell, but do not sell today. So on our example this rep now has 193 key accounts that can drive his sales objectives.

B Accounts

We will establish a call pattern that best serves this customer base and it is often 1-2 face to face meetings per year and quarterly calls and monthly emails. This rep has 123 B accounts.

C Accounts

All C accounts will be served by inside sales customer service and not field sales. They will use email, phone calls and direct mail to keep in touch with these smaller accounts and actually provide a better overall buying experience than what they were receiving.

When I applied this model to one of my sales teams that was struggling with net new customers and selling new products at current customers we realized the following;

we achieved new product sales objectives
exceeded our sales plan numbers
We achieved new customer acquisition targets
Our C accounts grew, 115% to prior sales within 90 days of implementation and in the following year grew over 146%
My field sales people made more commissions and were less stressed
Billing errors decreased
Overall customer satisfaction in all categories increased
Our account attrition decreased

Helping your sales team understand their markets A B C’s is one of the quickest ways to insure your sales plan is met and exceeded.

How do you segment and align your accounts for your sales people?

How do you transition accounts from inside sales to field sales?

How often do you transition accounts from B to C status?

Have you segmented your sales rep’s market and if so what results did you realize?

Helping your reps understand their A B C’s improves focus. This also will provide the time and incentive to pursue those accounts your owner always seems to drive by and then you get an email or phone call; “Why aren’t we selling these guys?”

Does Your Sales Compensation Plan Create “ Commission Junkies”?

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by Mark Allen Roberts

For as long as I have been in sales and sales leadership I have heard true sales velocity is about carefully balancing the carrot and the stick to manage your salespeople. If your sales compensation program relies on unrealistic goals and heavily weighted sales compensation plan based on a carrot too far away or too big…you are creating “Commission Junkies”.

Commission Junkies are slapping their cell phones and typing follow up “where’s my order” emails as fast as their fingers can move hoping to find their next fix.

Let me ask you….Who would you prefer to help you buy something? Would you prefer someone who takes the time to truly understand your problem to be solved and understands the costs associated with that problem? Or someone who is obviously all about “making his sales number” and “making his commission”? Do you want a professional sales person asking questions to understand your needs, or someone so focused on closing the sale they seem desperate? You might say;

“Mark that’s a dumb question…I want a sales consultant who helps me solve my problem, who understands my problem to be solved as if it were their own”.

(Quick look at your sales compensation program, and ask is that what you are rewarding?) …Really?

There is an old Native American saying: “the wolf we feed is the one that grows.”

What behaviors does your current sales compensation program feed?

OK….then why do so many sales compensation programs create what I call “Commission Junkies” who are desperately chasing that next fix of commission because their total compensation is heavily weighted on objectives that do not match your (published) culture?

Poor sales compensation models create bad behaviors in the field that can result in Brand Damage for your overall product offering.

So how do you know if your sales plan is poorly designed?

sales rep goals do not align with corporate overall strategy
your reps feel the goals are unobtainable
your reps feel the activities to hit their goals are out of their control
too many goals
a commission plan that requires a CPA to understand it
“commission claw backs”
commissions are not weighted based on corporate objectives
sales goals built from the board room and sent down to sales team to “make it happen”
it is the same plan you have used for the past 2 years
the variable portion of total sales compensation is weighted too high
goals that change frequently
you have a targeted compensation plan with a commission cap

As I shared in my last post, leading salespeople is not as complicated as we often make it. The very essence of most salespeople is to take the path of least resistance that drives their desired income. Put another way, we have a high Utilitarian characteristic that makes us wired to want the maximum return on our efforts in the shortest amount of time. .Salespeople are competitive and welcome stretch goals that are obtainable.

Sales Goals created with Market Opportunity Profiles drive results and the sales behaviors you want in your market.

The wrong sales compensation plan creates “Commission Junkies” only out to make their next fix… their next commission. They become so about the next commission and who can create the next order the fastest they often fail to execute the sales plan. As I shared in a previous post, nothing drives CEO’s more nuts than finding out the sales plan is not being executed six months into the year.

A few questions for you….

How are your sales to plan Year to date?

Are you at your targeted sales and profit goals?

Is your sales team meeting and achieving their new product sales?

Are you opening the targeted new accounts you forecasted (needed to) open this year?

With has high as 50%- 70% of sales people not meeting plan this year, if you answered “no” to any of the above you are not alone. Last year alone the average sales team had 50-60% of salespeople not meeting plan and their goals this year went up on average 33%. Knowing you are not alone does not solve the problem or make you, your boss, owner, and or investors happy. Far too often a leading reason sale execution fails is due to your sales compensation program creating commission junkies and not consultative sales partners.

Do you want to quickly assess if you have sales consultants creating great experiences with your brand or Commission Junkies causing Brand Damage?

Ask your buyers if they believe your salesperson understands the problem to be solved and is in the process of presenting a total solution.

If you find some of your team are Commission Junkies there is still time to rehabilitate them by creating Market Opportunity Profiles. You can find a good article about creating sales compensation plans here if this is an area you plan to work on.

Stalled Sale? … Put a Price Tag on Doing Nothing

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Stalled Sale? … Put a Price Tag on Doing Nothing

When I train sales teams one of the common questions is; “How do I fix the problem of the stalled sale?” Sales stall and buyers go dark for a number of reasons. I have heard numbers as high as 30%-50% of pending sales in pipelines will stall and possibly never happen. One technique that gets the sale back on track to close is assigning a price of doing nothing and reinforcing it with your buyer(s).

If you have been in sales for any length of time you have experienced the stalled sale. You set out on a journey with your buyer.You had a great meeting with the buyer and influencers, you presented your solution to the identified problems, you had all the buying signals, and the buyer indicated you will get his business but then the sale seems to stall. Key buyer deliverables are missed, your follow up voice and emails are not returned and unfortunately you have probably shared your anticipated new sale you thought was in the bag with your manager who is now driving you nuts with “where’s the order?” This buyer journey now seems to have stopped or maybe just stalled. What should we do now?

Buyers always have choices;

Buy from you
Buy from your competitor
Try to make do and fix it themselves
Do nothing

How do you fix stalled sales and drive them to a close?

Once you have diagnosed and prioritized buyer pain you must assign a value on the buyer doing nothing.

Assuming you have listened and now clearly understand the problem the buyer is trying to solve, what is the cost of doing nothing? For example, let’s say you are selling industrial equipment that is more efficient and saves energy. Very quickly you can assign a weekly dollar value of not making a decision and not fixing the problem. Once you identify that cost in dollars, energy inefficiency, or other measurements share that information with your buyer(s) and all sale influencers. In this same example you may also identify the cost of lost production if the current equipment fails. When you first determined the requirements for the buyer and his team, you should already have identified these pain points, their assigned threshold and value. For example, if a CEO is involved they are focused on driving revenues, bottom line profits and eliminating any risk that stands in the way of executing their vision. They know what a lost order is worth. The CFO knows what their overall energy consumption is and you can identify how your product can reduce this cost and by how much. CFO’s struggle with manufacturing variances and the real dollars associated with them.

Your follow up communications will take the tone of wanting prevent the pain we identified early and reduce or eliminate that pain’s associated cost as quick as possible as opposed to a acting like a typical commission junkie needing a fix. Your communication becomes about wanting to serve your client, and they are about your client and not about what you want. (The sale)

What are your buyer’s pains?

What is the cost of your buyer doing nothing?

Are there buyer pains that cannot have a cost of doing nothing associated with them?

Has your team used this technique? If so please share how it worked.

The stalled sale can be very frustrating and the longer the sale lags the higher your chances are of losing the sale. A phrase I share with a number of teams is “time kills sales deals” and I have personally experienced this to be true. Our job as salespeople is to clearly understand the problem, its pain, and assign a cost if the buyer does nothing.

A “Market Opportunity Profile” Insures Your Sales Team Hits Quota

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A “Market Opportunity Profile” Insures Your Sales Team Hits Quota

By Mark Allen Roberts

How prepared are your salespeople to “hit their sales numbers“ this year? Studies indicate as high as 70% of salespeople will fail to make sales quota this year. One leading reason is they do not adequately understand, identify, and prioritize potential sales and new opportunity accounts in their territory. One “old school” tool I provide my salespeople is a Market Opportunity Profile that takes the guess work out of sales achievement.

A Market Opportunity Profile is a living sales road map that insures your team meets and exceeds sales quota and creates sales velocity in the future.

Market leading sales organizations provide sales territory plans that include Market Opportunity Profiles.

What does a good Market Opportunity Profile include?

sales by current customers, ideally over the past three years segmented by product groups
current customer list segmented by A, B and C customers with sales history
identify elephants, rabbits and squirrels in each territory
targeted A accounts positioned for growth, with growth strategy and tactics
list of potential new customers in territory
new potentials ranked by dollar opportunity and probability of having problems your product or service solves
list of known market influencers (influencers your clients turn to)
list of new products that will be introduced , and when
new product sales targets by current customer
new product sales targets by net new customers
current and targeted new clients by physical location
sales goal by current customers
sales goal for net new clients
sales goal new products or services
activity profile based on known product sales cycles
activity profile based on new product launch(s)
salesperson input in each category

This sounds like a lot of work, however once you create this tool it will create a profile of the market your salesperson serves, and will build a living document to create meaningful discussions with your salespeople. Your sales by current customers /current products, current customer/ new products, new customers/current products, and new customers / new products must exceed your territory goals. You can create Market Opportunity Profiles with the help of your salespeople to make sales less of an art and more of a science.

Or…

You can take the goal given to you, divided by the number of salespeople you manage, possibly weighted by sales history, and throw it at your sales team and tell them to “make it happen” like most companies did last year and had 70% of their salespeople fail to achieve sales goals.

What does your team provide salespeople to create a roadmap to insure sales goals are met and exceeded?

Does your team provide a Market Opportunity Profile? What does it include?

What % of your sales team achieved or surpassed sales goals last year?

What % of your sales team is at 50% ( or greater) of their sales objectives mid year?

They say if you fail to plan, you plan to fail. Market Opportunity Profiles create a snap shot of how to achieve and surpass sales goals based on your market knowledge when created. As your team executes their plans, you will create additional learning’s by salesperson, account and territory. Who knows, after a few years of blowing your goals away corporate may just ask what you have been doing, and once you are promoted, you can use this process to create market driven sales goals instead of boardroom extrapolated goals pushed down.

Are your Salespeople Focused on Landing Elephants While Rabbits and Squirrels Run to Buy?

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Are your Salespeople Focused on Landing Elephants While Rabbits and Squirrels Run to Buy?

By Mark Allen Roberts

In my previous post I discussed a problem: “One common problem I am observing in the market today is salespeople are “hunting elephants with BB guns” and getting frustrated when they fail to bag their trophy. The market is tough and salespeople are hired to make it happen, make the sales number. Far too many salespeople focus on selling elephants to help bring their sales to quota back in line and this tactic backfires.I shared how ill equipped and poorly trained most salespeople are calling on large key accounts ( elephants) , and they are not only destined to fail, but there is a high probability they are also damaging your brand in the mind of key account buyers. Another, problem that compounds the focusing in on elephants is the opportunity cost lost rabbits and squirrels running to buy.

Do your salespeople clearly understand the market they serve and the opportunities that exist?

What I have personally experienced helping sales teams is everyone knows who the elephants are. This is a problem as all your competitors are just as likely focusing their scopes right now to bag what you thought was your elephant.

In the background of your market, there are smaller accounts, (rabbits and squirrels) running to buy.

I like selling smaller accounts as well as elephants.

Why do I like selling smaller accounts?

sales cycle is much shorter
the equipment and training is less expensive
you are dealing with the economic buyer ( the owner) in most cases
they are busy, and value your consultative approach as an expert in the solutions you provide
they are more profitable as a % of sale than elephants
they appreciate your solutions to their problems more
the buyer is in the market you are hunting in and not “corporate” some where
higher close percentage, higher probability to win the sale
they rarely use RFP’s
they are less likely to source complimentary products, accessories and parts
the salesperson does not require a great deal of training and experience
they often grow into bigger accounts

Market leading sales organizations balance their focus on elephants, rabbits and squirrels.

How about your sales team? Do your salespeople have a balance of elephants, rabbits and squirrels?

Does your sales team focus only on landing elephants or do they also fill their commissions on rabbits and squirrels?

Have you segmented accounts by lifetime sales opportunity?

Do you have an inside sales model that helps identify where the rabbits and squirrels are hiding?

As the sales leader, are you equipping your salespeople with a complete market opportunity profile, or is your lack of market knowledge showing?

Insure your salespeople hit their numbers by providing a market opportunity profile that includes elephants, rabbits, squirrels and any other varmints you can land in your market.

Failure to do so and you are setting your salespeople up to be road kill in their year end performance review.

Are Your “Salespeople Hunting Elephants With a BB Gun?” Answer 10 questions…

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Are Your “Salespeople Hunting Elephants With a BB Gun?” Answer 10 questions…

As I have shared in prior posts, salespeople are like water; they find and take the path of least resistance. Having carried a sales bag for years I get it; it takes a tremendous amount of work to sell a large number of new accounts when I can sell one big account and make the same amount of money, and possibly more. The problem is most salespeople are ill equipped to land big accounts so they are hunting elephants with a BB gun. When your team hunts elephants with a BB gun they not only fail to hit sales objectives, and fail to increase the number of prospects in their funnel….there’s a high probability they are irritating the elephants.

Some of my fondest sales memories were landing some big elephants in the markets I served like; Wal-Mart, Block Buster, Musicland Stores, Nintendo, Dell, Blackberry, and others….and I have to admit it was a rush. I had a big advantage though and that was training and sales tools to land big accounts (elephants). When you sell big accounts you must understand how they buy, who is involved in the buying decision, and aggressively pursue the economic buyer. ( the one who has the power to write you a check) Just as if you were hunting elephants on the plains in Africa, you would equip yourself with a different set of equipment (tools) to bag your trophy, than if you were hunting rabbits or squirrels in Ohio. The environment is different, your weapons are different, and the net number of targets and shots you can take is very different.

One common problem I am observing in the market today is salespeople are hunting elephants with a BB gun and getting frustrated and surprised when they fail to bag their trophy.

How do you know if your salespeople are hunting elephants with a BB gun?

Have your salespeople focused on and failed to close elephants in the past 6-8 months?
When you ask why they failed to close the sale, all they say is price?
Do you keep hearing “good meeting” but fail to see an order or a clear understanding of what was achieved at the last meeting and what the next step of the buying process is for the prospect?
Do you notice the entire sales territory is underperforming to plan?
When you ask about the territory performance, does your salesperson always add the elephant to the discussion?
Are other team members complaining they are being pulled into this “big” opportunity and they are not seeing the sale moving to a close?
Has your salesperson said something like; the account just went dark?
Have you seen new leads not being followed up on in a timely manner?
If you did bag an elephant in the last 6-8 months, was it significantly under your profit targets?
..I saved the hardest question for last …What does your gut say, should your salesperson be presenting large key accounts in your market? Are they trained and have they demonstrated the ability to listen and present solutions to problems? Would you want your salesperson calling on you?

So how did your team score? If you answered “yes” to four or more of the above, your salesperson is hunting elephants with a BB gun. How did you answer question #10? If you said “no” stop irritating the elephants in your market today.

There are a number of problems with your salespeople hunting elephants when they are not equipped to win;

they fail to bring home all the rabbits and squirrels in their market

they only irritate and make the elephants angry and that anger is attached to your companies’ brand

they compromise margins and they are operating in the domain of losses

they pull resources from other areas of the organization that fail to meet their objectives

Market leading sales organizations understand the buying process for large key accounts is different than the smaller accounts they serve, and they provide the tools and training to clear the jungle and bag those market elephants.

How is your team’s sales history bagging elephants?

What is the main reason your salespeople say as to why they failed to win their trophy?

How many other opportunities are not followed up on that they could close with a BB gun?

Do you agree or disagree elephant hunting requires different training, tools and experience?

If your team wants to bag some elephants, are you equipping them with the right tools and training? Or are you counting on them to “just make it happen”?

Are Your Salespeople “Growing a Market”…Or Working a” Bread Route”?

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Are Your Salespeople “Growing a Market”…Or Working a” Bread Route”?

A common concern I hear from business owners is their salespeople are not effective at selling net new customers. New customers, if serviced properly become lifetime customers with current and future revenue opportunities and contribute to creating sales velocity. In addition, they make up for account attrition, you know …customers who go out of business or just go away. (another future blog needed as customers do not “just go away”) New customers result in additional commissions for the salesperson right? Since new customers are so key to every businesses current and future sales revenue goals and can add additional commissions then why are sales people not closing new customers?

One of the leading reasons I have personally experienced why salespeople are not growing their markets is ; they are working a bread route.

As I have shared before one of my first jobs was a route salesman with Frito-lay. Fresh out of college I drove an 18 foot step van full of Frito-lay products to my grocery stores, convenience stores, bars, and anyone else I could open. Frito-lay made the sale of new accounts one of my key indicators along with selling additional store placement displays and gaining shelf space. The one route sales guy who would beat me to my grocery store accounts was the bread route delivery person. They would always amaze me at how fast they could get in and out of a grocery store and move on to the next account. They started very early in the morning like me, but were often done with their route by 2:00 pm. The bread route driver was focused on visiting his current accounts, accounts he and his company have relationships with, finding out what they needed and filling the shelves. They had very specific routes and timelines and if the driver executed his or her route effectively they made a good living. The bread route driver made enough income serving his current customers that he did not need to open new customers.

Fast forward to today and I see bread route drivers in all kinds of businesses. These are salespeople who call on a bank of current customers who should need additional products and or services and if they work their route they should meet their personal income goals. Current customers are the easiest to deliver products to because you and your company have a relationship with them. They welcome you in, if you ask for an appointment they make themselves available…heck, they even reply to voice mail and emails!

Selling new customers requires connecting with new people you do not know, new companies you may not be failure with and risk. No salesperson likes rejection and every time you attempt to start a discussion with a potential customer, (someone you could sell but you are not currently selling) you risk rejection. In addition, since you do not have a relationship you often experience frustration through a lack of returned phone calls and emails, trying to get past the gate keeper, trying to determine the buyer’s process and criteria and so on… all the while needing to make your sales objectives (and commissions).

So how do you know if your salespeople are growing their market or working a bread route? I have a few questions…

How many net new clients have they added in the last 6 months, last 12 months?
What % of their monthly commissions is the result of net new customers over the past 6-12 months?
If your salespeople report on sales calls, what % of calls are net new potential customers?
Do your salespeople have “everyone” in a particular market that has ever bought from you? Or do they have a fraction of the total number of accounts?
When you conduct four-legged sales calls with your sales people, do they take you around to current customers and drive by a number of potential new clients, or do they add net new targets along the way?

So what’s your gut telling you right now? Are your salespeople working a bread route or growing your market? How did your team score with the above questions? Below is how I have viewed the responses to the above questions when I have helped clients.

How many net new clients have they added in the last 6 months, last 12 months?

I monitor the number of net new clients. As a general rule and can vary based on the maturity of your industry and the frequency with which your team introduces new products….if a salesperson is not adding at least 5% of their total number of customers every six months, ….they are working a bread route.

What % of their monthly commission is the result of net new customers over the past 6-12 months?

In addition to the number of new accounts I look at the revenue those accounts contributed and also how that revenue grew the salesperson’s commission. Again whether or not you have a history of launching exciting new products designed to solve the markets unresolved problems or new product flops , the maturity of your industry, the experience and training of the salesperson…I look for at least 5-7% (ideally 10 %+) of commissions coming from customers they have opened in the last 12 months…if they have little or no commission from new customers…they are working a bread route.

If your salespeople report on sales calls, what % of calls are net new potential customers?

Winning new customers requires a great deal of activity. I am not however advocationg activity without focus as I have discussed prior as another problem salespeople often encounter. The rule I have used in multiple industries is 20 unqualified prospects should turn into 10 potentials, and from that 10, 2-3 proposals and 1 new customer. If your salespeople are not trying to connect with at least 20 new accounts per month ( 5 per week) ….they are working a bread route.

Do your salespeople have “everyone” in a particular market that has ever bought from you? Or do they have a fraction of the total number of accounts?

If all your customers are lumped into one group and not segmented based on key accounts, targeted growth accounts and you have not identified targeted net new accounts… they are working a bread route.

When you conduct four-legged sales calls with your sales people, do they take you around to current customers and drive by a number of potential new clients, or do they add net new targets along the way?

I enjoy working with salespeople in the market. I enjoy interacting with salespeople, their customers and potential new customers. If you work with your salespeople and they take you only to happy customers and drive by potential net new clients and have not started or attempted to start discussions with them…they are working a bread route.

So how did your sales team fair? Are they growing a market or working a bread route?

As long as they hit their sales numbers do you care? Should you care?

If your salespeople frustrate you by poor execution in closing new business, it could be because they are working a bread route. In my next post I will discuss how to change that behavior and drive net new customer revenues for your sales team.

Improve Sales With A “Sales Requirements Summary”

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Improve Sales With A “Sales Requirements Summary”

In today’s market buyers have the power to find solutions to their problems. Sales people and their sales processes must adapt based on what we know about buyers today. Market leading sales organizations are adding the power of the “sales requirements summary” into their solutions presentations to win more sales, and increase sales velocity.

When we ask salespeople why a buyer chose an alternative product we often hear it was price, followed by a unique feature or benefit, and then relationship. However when we ask buyers why they did not buy, “price” was not on the list of reasons. So if price is not on the list, why is it buyers do not buy? The consistent and overwhelming answer was;

“I do not believe the salesperson clearly understands my problem, and therefore I do not trust the solutions he is presenting will adequately and completely solve my problem.”

To overcome this buyer concern and ultimately improve sales close percentages and increase sales velocity I coach salespeople to add a “requirements summary” in their proposal. So what is a requirements summary? If your industry demands long presentations there are a number of templates for requirement summaries. However I believe in the KISS principle so I have found a good requirements summary includes the following;

restate the problem to be solved as you understand it
restate buyer and all project influencers
provide details from your meeting notes about the specifics of the problem, corresponding products and or services your solution must work with
how to measure the success of your proposed solution
restate timing the buyer expressed for the solution to his problem to be delivered
state your delivery commitment with a call to action…if you need the product delivered by ______ we will require an order by ________.
speak to all buyer and influencer pain points discovered in the sales qualification process
state how your solution uniquely solves the requirement and pain
specific part number(s)
total cost summary
timeframe for quote, ideally 30 days

The requirements summary helps overcome the reason why buyers do not buy; Trust. In addition to showing you clearly understand the buyer’s requirements and pain, the summary also provides the opportunity for the buyer to share if requirements have changed.

Most salespeople are so focused on selling they are not truly listening. Knowing you must produce a requirements summary in your sales proposal insures your salespeople are asking questions to intimately understand the nature of the problem to be solved and how the buyer and his or her team will measure the results.

Does your sales team provide a requirements summary in each proposal?

Do you see any negatives in providing a requirements summary in your sales process?

A requirements summary is a simple and effective way to build trust with your buyer by illustrating you understand his problem and how you plan to fix it. Most competitors will be leading with price because they feel that is what wins orders. Be one of the top 10% of sales professionals by taking copious notes concerning the problem to be solved, all those who have input in the solution, and everyone’s pain points and you will win more sales faster regardless of how “cautiously optimistic” your buyers may be.

“Throw the Skunk on the Table” Early to Win New Sales

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If you have been in sales for any length of time you will agree one of the most difficult sales to make is with a customer who had a bad buying experience in the past. Inexperienced salespeople will hope this smelly past buying experience will not permeate the new sales opportunity they are selling. Experienced sales people know to “Throw the Skunk on the Table” early in your new sales process.

I have served a number of industries over the years and it is not uncommon to rely on your current customers to purchase additional products and services as well as new products to hit your revenue targets. It is inevitable you will have a customer (hopefully not too many) who had a bad buying experience in the past. Maybe they ordered a new product that failed to meet the buyer’s requirements or criteria. Maybe your new product launch was late and missed a critical delivery time? Whatever the reason…your buyer was unhappy.

What should you do if you know a buyer you are now trying to sell had a bad past experience?

“Throw the Skunk on the Table Early!”

Inexperienced salespeople will try to act like that smelly past problem is not still lingering with the buyer. They may dance around it, or if it is brought up try to dismiss it and stay focused on the present sale (commissions). As the recent post in Revenue Journal’s blog : Why Do Buyers Agonize? Because Sellers Lie and Minimize shares how buyers are trying hard not to be disappointed. If they have bought product for any length of time people have sold them products or services that did not meet their expectations. Buyers today in particular in what I refer to as a “cautiously optimistic buying environment” are even more careful. They do their on line research, checking the internet for comments posted about a company or product, and they have short memories.

Experienced salespeople know the worst thing to do is ignore the odor of a bad buying experience. Experienced sales people bring up the past experience, briefly discussed what occurred as well as the corrective action then, and since then to insure the buyer is not disappointed again. Failure to acknowledge a bad past experience violates trust. When you ask buyers why they did not buy, it often surprises people to learn “price” is not even on the list. The number one reason is a lack of trust. Specifically that the salesperson did not clearly understand the buyer’s problem and has proposed a solution that will not completely solve it.

If you are meeting with a buyer who was disappointed in the past, throw the skunk on the table early in the sales call and you may just win the new sales opportunity while re-building trust.