PRINCIPLE 1: You serve diverse buyer segments … act like it
PRINCIPLE 2: Serve different segments with different sales motions
PRINCIPLE 3: Deliver sales messages that matter
PRINCIPLE 4: Focus scarce investment dollars for maximum return
PRINCIPLE 5: Position your sellers to deliver impact
PRINCIPLE 6: Ask sellers what they need
PRINCIPLE 7: De-isolate the sales function
PRINCIPLE 8: Always be learning
In this article, Alexander Group will discuss details on the first two principles of reinvention.
Revenue growth ambitions are building as companies expect big numbers in 2015. Consider the following:
The numbers in 2015 are expected to show improvement over a solid 2014. At the 2014 Chief Sales Executive Forum (CSE) 15 speakers, from tech, to medical devices to heavy industry, described critical aspects of their growth strategies, from launching new products to opening new markets. Of particular interest were observations on the critical role of Sales in providing the energy and the know-how to power these strategies by focusing less on what products do and more on what products enable customers to do.
There was a hitch. According to a Harvard Business Review article in September 2014, research shows that only 10 percent of business strategies are effectively implemented. Research pinned the blame on the fact that …
“Management embarks on a strategy without considering the realities facing the people who must execute it with paying customers.”
The speakers and companies featured at the 2014 Forum took the opposite approach. They considered the realities facing their sellers and “reinvented” key elements of the sales function to emphasize value over discounts.
Principle 1 – You Serve Diverse Buyer Segments … Act Like It
Alexander Group’s 2015 Sales Pulse Survey found that buyers are broken into three roughly equal categories: Price Seekers, Product Seekers and Insight Seekers.
While about equal in size, these “customer segments” make buying decisions in unique ways:
Note that these segments are not defined by what or how much is bought. They are defined by how products are evaluated. Given the size of each segment, savvy sales executives realize they must competently cover all three. As a rule our speakers attempted this by:
These two actions are linked; money saved through efficient coverage of Price Seekers can be invested in deeper coverage of Insight Seekers. For example:
Top sales organizations cover different segments with different resources, aiming for efficiency when covering “price seekers” and effectiveness when covering “insight seekers.” Efficiency in lower margin segments is converted to both cost saving and skill building to ratchet up the level of coverage effectiveness in other segments. Coverage dexterity helps top sales organizations serve all markets well.
Principle 2 – Serve Different Segments with Different Sales Motions
A sales motion is the combination of messages, activities and resources that, taken together, forge the ideal coverage pattern for a particular buyer segment. The ideal motion is the one that delivers the necessary value to the customer at the least cost to the seller. Innovation buyers expect value-laden insights from “experts” to describe and help execute a better way of doing business.
That kind of coverage is expensive and comes with a price premium. Price-oriented buyers, on the other hand, expect timely and efficient delivery of deal terms. A simple sales motion, perhaps delivered via the Internet, is sufficient. As one keynote put it, “Delivering insight on how to improve a business process is a whole lot different than delivering purchase terms.”
Different buyers, different needs, different motions. There are three basic motions that attach to the identified segments:
Note that the Innovation and Product Advocacy motions require understanding of both what is important to customers and how your products connect to this value. Many companies are not poised to execute these motions successfully. CSE Forum Speakers identified two critical questions to assess the degree of “customer centricity”:
1. Are you fundamentally focused on serving customers or promoting products? Silos of marketing and sales resource dedicated to promoting slices of the product line based on features independent of how customers make buying decisions is a sure sign of “product centricity.” Examples of how companies have pivoted away from such product centricity to align more closely with how customers make buying decisions were offered:
2. Do you have a Sales Operations organization capable of supporting customer-centric coverage? Forum speakers described three important services that their powerful sales ops functions provide:
Great plans get implemented only when jobs are populated, measured and goaled. That is what leading sales operations functions do to make customer-centric coverage possible.
Read Part 2 of this series.