As a business leader in a constantly evolving market, it’s critical to be flexible and willing to embrace new strategies. The businesses that see sustained success find opportunities to launch successful new products or enter new markets.
Alexander Group recognizes the critical role of sales departments in providing the energy and the know-how to power these strategies. Your sales team can see your business strategies through to success by focusing less on what products do and more on what products enable customers to do.
Research has shown that only 10% of business strategies are effectively implemented, pinning the blame on the fact that business leaders often implement strategies without considering how they will impact the workers carrying them out.
Your organization can execute profitable sales strategies by considering the realities facing your sellers and reinventing key elements of the sales function to emphasize value over discounts. In this article, we cover eight sales force reinvention principles that increase business strategy, including insights from Alexander Group Executive Forum speakers.
Alexander Group’s Sales Pulse Surveys₁ have 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.
Reorienting the Customer Segment Approach
Given the size of each customer segment, savvy sales executives realize they must competently cover all three. As a rule, our speakers attempted to address all customer segments by:
Improving Sales Efficiency
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.
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 an understanding of both what is important to customers and how your products connect to this value.
Many companies are not poised to execute Innovation, Advocacy and Fulfillment successfully. Two critical questions can help assess the degree of “customer-centricity”.
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.” Here are examples of how companies have pivoted away from such product-centricity to align more closely with how customers make buying decisions were offered:
Forum Speakers have identified three important services that their powerful sales operations functions provide:
The messages that sellers deliver to buyers, especially those who value innovation, cannot be taken for granted. When calling high (and is that not the goal?), the message must resonate quickly, or there will be no second chance. Innovation buyers are frequently close to or in the C-suite. Yet, according to one Forum guest, sales collateral coming out of the typical Marketing department is so product-focused that most innovation buyers “tune you out and send you downstream to buyers who care less about ideas and more about price.”
Where this happens, the sales organization is subject to “the law of the jungle” where sellers are responsible for their own messaging and only the strong survive. Sales leaders know that the key to success is to lift up the whole sales organization, rather than simply depending on the top 20%. While training, coaching and playbooks all matter, success in the innovation and product advocacy motions begins with a message that connects what sellers can deliver to issues that customers must face and surmount.
According to a top business school faculty member at the Forum, the attributes of the most effective messages can be described as follows:
Where Marketing was not crafting powerful or useful messages, we found sales leaders are stepping in to fill the void.
Accuray’s Viewpoint Shift
Accuray had a Marketing function run largely by “brilliant engineers.” While they excelled in articulating product specs, they had failed to describe what made Accuray products different and valuable.
Their prescription—integrate the Marketing function with executives who possessed a “deeper understanding of customers” (yes, that means some sales experience) capable of turning the message development process on its head by looking at products from the customer’s point of view.
Oracle’s Need-Based Marketing Pivot
When Oracle found the buying point for its products had moved away from IT toward functional heads of HR, Finance and Marketing, they too needed to craft messages that spoke to Oracle’s ability to help solve functional issues without dwelling on specific product details. To accomplish this Oracle transformed the entire marketing and sales ecosystem.
They pivoted from product marketing groups to marketing and sales specialist units built around serving the needs of specific customer functions, like HR, Finance and Manufacturing. The result—messages, collateral and sellers that integrate a deep understanding of customer needs and expertise in the solutions that Oracle can offer.
Johnson Controls’ Audience Adjustment
Johnson Controls found customers (architects, developers and corporations) were increasingly attracted to green technology, bundles of products and services, as well as the cost of ownership analysis. This was at odds with JCI’s traditional sales approach and messaging that stressed individual product line excellence. It was time for a change.
Johnson Controls created a deep account management structure, supported by specialists, to deliver the insight and messaging customers needed to hear. That meant partnering with Product Marketing to craft messages targeted to real customer concerns—operating expense management, capital budgeting, sustainability—instead of focusing on topics of importance to product engineers.
If you organize to serve real customer needs without deference to legacy approaches, great things can happen. This matters a lot when revenue growth expectations far outstrip increases in selling expense.
Companies that do not carefully choose where to focus their investment and where to streamline for efficiency are destined to fall behind in the markets that matter to them the most.
Pitney Bowes upended the traditional sales resource investment model to enable far-reaching reinvention when efficiencies found in covering a large but declining market were used to fund growth in new, more robust markets. Specifically, Pitney Bowes …
The result—an 8% increase in EBIT in a declining market became available to fund expansion in more promising, higher growth markets.
Cisco found that only 22%-23% of an average seller’s time was actually devoted to selling despite a company goal of about 40%. Digging deeper among sellers and partners with interviews and surveys, Cisco found that Sales Ops, Human Resources, Marketing, and individual Business Units, in their quest to “enable sales,” were actually inundating sellers with messages, materials and training that were confusing, contradictory and often useless. By consolidating all the disparate initiatives into a single Sales Enablement function, dedicated to finding out from sellers what they really need, Cisco was able to …
A technology sales executive at the Forum noted that a customer-centric sales process consists of five steps:
According to another executive from the medical technology industry, “90% of seller time is typically devoted to closing.” Yet closing behavior and activities do not earn a seller the opportunity to meet with C-suite executives to explore any form of “business impact.” “Product push” typically results in being “packed off to purchasing.”
Selling impact requires that more time and resource be dedicated to ideation and design on the front end as well as helping customers implement and use products after the sale.
GE’s BioProcess Division had a competitive environment in which traditional, as well as emerging competitors, focused almost exclusively on perceived product features and advantages. Outside of specific leading-edge products, price emerged as the chief means of competing.
The chief concerns by the executives were less about product features and more about production expertise, production deadlines and capital preservation. They saw a chance to differentiate from the competition by ideating with the customer on how GE could help them deal with their business issues. They shifted the mission of the sales force from “selling product quality and performance to selling manufacturing strategies and their execution.” Sellers needed to move from delivering product specs to delivering:
To accomplish this, they created:
The result—newly appointed account managers could deliver messages and services, along with products, that together could not be matched by the competition. And the enriched capabilities opened a dialog with top management on the customer side that the product alone would never have allowed.
Commenting on the typical customer experience after the sale, Andersen Corporation said, “Dealers expect bad service.” They looked at this as an opportunity to both deliver greater impact and develop deeper, more lasting relationships. The company shifted the service mission from “reacting to problems” to “avoiding error before it happens.” The organization structure was changed as well:
The result—Andersen was able to accept more orders, process them more accurately and enhance the experience of the dealer in ways that “ultimately saved the dealer and the end customer both time and money. While it is often difficult to justify service costs, putting them into the front end of the sales process was an industry game-changer.”
Despite the best intentions, top organizations can overwhelm their sales forces when delivering operational support for a customer-centric sales approach. Said one exec, “With IT, HR, Marketing and Sales Ops all supplying tools and collateral, none was focused on what the sellers really needed to better serve customers. For all the money spent, not much value was really delivered to Sales.”
Cisco’s Advice
Recent efforts at Cisco are a great example of how you can do “more with less” if you engage sellers in a discussion of what they actually need vs. push materials and tools on them “from the inside out.” Cisco offered three pieces of advice:
Cisco’s Results
The result—upon quietly launching the Sales Enablement Portal, Cisco picked up 14,000 users almost immediately, as a result of positive, viral word of mouth. This number far surpassed the traffic on all prior web-based enablement efforts put together.
More importantly, the ease of use returned precious hours to the seller (at least three hours per week) and enhanced seller effectiveness by putting the latest tools and cases literally at their fingertips. And because Cisco did all this by combining previously disjointed efforts of several functions (marketing, human resources, sales ops, finance), they were able to deliver more value at a fraction of the original spend.
In many organizations, the sales function is in a unique position to play this integrative role. It is the one function that understands both the product line and the customer, and its voice is becoming a necessary part of designing and executing a successful growth strategy.
With the sales function gaining recognition as a strategic asset, sales leaders should be engaging with top company leaders on a more regular and interactive basis. Specifically, sales leadership should contribute to strategic decisions and discussions on how best to implement them.
The leadership teams at top companies (including sales leaders) know that effective strategy implementation requires that management does consider the “realities” of the sellers on the ground with customers.
Pitney Bowes sought improved transparency in forecasting. Accomplishing this required a new communication cadence that would promise to be an operational challenge. Sales operations took the lead in building a new pipeline review cadence with the CEO, Business Unit leaders and Country leaders every other week. In this regimen, geography management and product management are brought together by the Sales function to discuss strategy and tactics to make the numbers.
Customers are the core source of insight regarding value for companies that are willing to listen. At Alexander Group’s Executive Forums, we’ve heard how some companies maximize their learning by introducing tools and processes that compel marketing and sales to partner with each other and with customers. Noted below are some of the ways in which this is done:
The tools at the heart of the intersection between customers, marketing and sales bring all three parties together. The corporate Center of Excellence provides customers, sales, marketing and top executives with a venue to learn about current strengths and capabilities. Facilitated brainstorming sessions enable Customers, Marketing, Sales and Innovation executives to speak openly of future strategies, challenges and ways they could work together.
How Leading Companies Improve Their Connection With Customers
Other tools (such as Customer Panels and marketer/seller “ride withs”) foster connections between Marketing and the customer or between Marketing and Sales.
Consider some examples:
Customer insights are there for companies and for sellers that choose to pursue them. This requires a thirst for learning and a willingness to collaborate. The common denominator among the examples noted here is that each of these companies has carefully created and nurtured a learning culture.
The numbers tell a story:
The numbers are compelling, but they are only a start. Each of the above companies would say the same thing: Reinvention is not an event—it is a process.
Change is a constant among customers, products and competition. Sales leadership is at its best when it finds ways to take advantage of these changes and to better serve its customers. Sales force reinvention is not about revolution. Rather, it is a constant series of small changes, inspired by the customer, that enable the sales force to deliver more value and greater differentiation.
Alexander Group is a consulting firm ready to partner with you in the process of reinventing your sales force and revenue organization. We leverage innovative tools, insightful data and unparalleled experience to curate strategies that drive results. With Alexander Group as your partner, you’ll optimize critical sales processes for more frequent, more efficient conversions. Please contact us to discuss how we can craft strategies for your organization and reinvent your sales force.