 (or why your marketing costs are too high)
By Scott Gordon, The Chief Revenue Officer It’s safe to say I’ve interviewed, hired, and fired hundreds of salespeople over my career and worked alongside hundreds more. During those 20+ years of selling and managing sales teams, I’ve found that folks who pursue sales as their avocation fall into three distinct buckets:
The number one symptom of an order taker based sales culture is a stubbornly high cost of customer acquisition. This is where a company spends reams of money on things like Google Adwords, Facebook Ads, print, mailers, billboards, email lists, call center agents, etc. The primary beneficiary of this arrangement is the salesperson who, for very little effort, is provided with a calendar full of appointments to go out and close. Unfortunately for the organization in question, each one of these appointments carries with it a high cost, so pressure to close (and requisite training and accountability) are of paramount importance to achieve a respectable ROI on marketing spend. These are the Glengarry leads and coffee is for closers! My point isn’t – don’t market because it’s too expensive, but rather to work through a process of grooming order takers to become hunters because hunters provide you with your lowest cost business (especially if you pay a referral fee to referring clients), followed by farmers, and in dead last, order takers (who, as a rule, squander far more leads than they close). The conundrum here is that hunters are a very rare breed. They are unfazed by rejection, driven to succeed, and love the thrill of the chase. Sadly, they are in very short supply and can basically work wherever they want because every V.P of Sales is fighting over them. Farmers generally end up where they are in one of two ways:
My general approach to grooming farmers is to work through formalized customer referral programs where the order takers proactively drive the program. These programs can be set up in a number of fashions, but the key is that referrals become a sales driven activity, and there’s more to it than loading a ‘referral app’ on their iPhones. Such a process will accomplish three goals:
As you begin to separate the wheat from the chaff, try to up the quality of your sales candidates during the interview process. While I personally listen for many cues during an interview, my #1, numero uno pet peeve/turnoff is when a candidate asks: “How many leads will you provide me and where do you get them?” I refuse to answer this question. Why? I know I have a serial order taker on my hands. I’d be best served ending the interview as quickly as possible to get to the next candidate. I’ll only hire a person who asks this question if I have leads coming out of my ears and am desperate to find a body to fill the vacancy. Otherwise, forget it! They are a dime a dozen and not worth the dime or your time. Real salespeople don’t ask for leads because they know how to prospect. To them, leads are gravy and are probably inferior to the quality interactions they create on their own with their particular set of skills. Truly remarkable sales professionals won’t want your leads because the ones they generate are so much better – e.g. close at a higher rate with less effort. Let’s get back to our farmers. Earlier I mentioned that these can be ‘grown’ from order takers, yet just like most order takers will never become farmers, the same is true of farmers becoming hunters. However, there are top grading strategies that you can use to add a hunter element to a farmer’s activities. They are centered around these concepts:
From this progression of formalized sales activities and programs, it is possible to groom an order taker into a hunter, all the while lowering your customer acquisition costs as you go. You will shed the posers and order takers (further lowering carrying costs for under performers) and organically grow your business by leaps and bounds as you consistently top grade your sales talent. And all those extra marketing dollars you’re spending today? Maybe you’ll get to keep a few more of those for yourself.
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 By Scott Gordon, The Chief Revenue Officer
Whenever I perform a CRM implementation or process optimization project, I’m often stunned by the laissez-faire (hands-off) attitude towards the handling of critical sales and operational data. There’s an old expression in database management – garbage in = garbage out. Therefore bad (or no) data in equals poor decision making, bleeding margins, and poor customer experience out. Usually when I’m asked to conduct a CRM project (generally a Saleforce.com rollout), my client is having challenges related to point solution proliferation (there’s an app for everything these days), disjointed processes that lack definition or accountability (see point #1), dropped balls, missing documents, poor customer communication, and an overall lack of visibility into the real metrics driving their business. They hope by rolling all of these disparate software and cloud based solutions under one all mighty platform that process, forecasting, and accountability will take care of themselves, but, in my experience, that is seldom if ever the case. If the bridge is out, you don’t need a new car, you need a boat (or a plane), or a new bridge. In fact, while there can be a lot of heavy lifting related to a CRM platform migration, the implementation itself is just the beginning of a much longer process. Without roll-out and frequent refresher training, many users will simply revert to what they’ve always done because it works for them and change is hard. Most end users don’t have the perspective to understand why using the new platform you’ve selected is important (because it’s often never explained to them) and why the integrity of the data they enter into it can mean the difference between a profitable venture that provides them with opportunities for advancement and pay increases, and one that eventually succumbs to the weight of its own inefficiencies. Imagine, you’ve just made a significant financial commitment to Salesforce.com and a consultant to get it up and running for you, but your operations employees continue to track their projects in Google sheets and your salespeople work their pipelines in personal organizers. If you plan on leveraging Salesforce’s powerful reporting and forecasting capabilities (which you’ve now paid a handsome price for) you need these folks to forgo their old ways in favor of the new unified platform where this far-ranging data can be consolidated, organized, and harvested for better business intelligence. If you are unsuccessful in doing this, no platform, regardless of its capabilities, will ever live up to its full promise. What you’ll be stuck with is incomplete data that continues to live in various buckets in a multitude of formats, all of which lack compatibility with any of the others. How can you solve this challenge?
In today’s data driven world, organizations that amass data, organize it, reconcile it, and use it to make important business decisions significantly outperform those that don’t – especially at scale. Integrity in equals profits out. These firms are able to identify dropped balls and stop dropping them. They are able to remove redundant or duplicative process steps. They are able to forecast sales and revenue with accuracy so they can properly staff their businesses to reflect current business conditions. They are better able to deploy scarce resources and make smarter investments. They provide world-class customer service. Most importantly, they become significantly nimbler and more profitable as the data driven improvements they implement compound over time. Garbage in equals profits out only if you’re a garbage man, otherwise, ensuring that your company is consistently giving its valuable data the respect it deserves it critical to its long-term success. Neglecting to do so, puts your firm at a distinct digital disadvantage in today’s information economy. If you’re working on disparate I.T. platforms and making decisions based on incomplete or missing data (e.g. going with your gut), it’s just a matter of time before you become a relic of a bygone business era.  By Scott Gordon, The Chief Revenue Officer You’ve been thinking about a certain home improvement project for some time, but, for one reason or another, you just haven’t pulled the trigger. Then you see a television commercial, hear a radio ad, open a free home improvement mailer or magazine, receive a robo call, have your door knocked on by a salesman, or see a neighbor up the street having said improvement performed on their house. Suddenly you are compelled to action. That final ad, vehicle wrap, or billboard finally pushed you over the edge and now you want to get a quote from that company. So, what do you do next? If you’re like most people I know (myself included), you grab the smart device nearest you, open Google, and enter “Name of Company” & reviews. What you see next will determine whether you do business with the company that final got you off the fence or one of its competitors. It’s quite simple really. Page one of Google is your online business card in today’s instant access to everything culture. What your potential clients find lurking there will determine the ultimate growth trajectory and profitability of your company. The key to this search is the word “reviews” (or “complaints”). Google’s algorithms will instantly serve up all the Yelp, Pissed Consumer, Google reviews, Houzz, Glassdoor, Indeed, etc pages with star ratings in tow. At a quick glance, your prospect will see the good, the bad, and the ugly and make a quick determination whether they are going to hand you their hard-earned money or award the job to a competitor instead. As you’re reading this, you’re probably thinking ‘CRO, tell me something I don’t know’. Of course, we all know that the majority of the buying public today uses online reviews for everything from restaurants to garage doors, but even though this may appear self-evident to most, I’m astonished by the number of companies (particularly home improvement contractors), that spend piles of money on mailers, print ads, radio & t.v. commercials, etc only to neglect both their online reputation and page one Google results. This is what I mean by ‘advertising for your competitors’. One of the ways I prospect for new clients is to save all the home improvement mailers I receive. A few times a month I go through these and determine what value I might be able to bring to the various organizations advertising in these media. E.g. can I capture some of their advertising dollars and provide them with a higher return on those dollars? I do two things with each ad:
The second search demonstrates the power of their SEO (search engine optimized) content versus their competitors. For advertisers who do well on both counts, I give them a humble nod for a job well done. For those who fail the first test, they go on a specific follow-up list. Same for those who fail the second test, but pass the first one. Unfortunately, many companies fall down on both, and I have a very special list for those folks. I was inspired to write this blog after a recent experience where I saw the same home improvement contractor’s ad in every mailer I saved in the months of July and August, yet said contractor has terrible SEO and the worst online ratings in its industry! Worse, they bought the cover of two of the publications I reviewed. Holy expensive, Batman! As you might imagine this enigma inspired me to probe a lot deeper, and I spent several hours reading their customer and employee reviews everywhere I could find them. After digesting all of this information I quickly came to the conclusion that their advertising was working. They are obviously doing a lot of business, but I had to wonder how much of their large advertising budget was benefiting competitors in their space who had 4 - 5 star ratings versus their 1.5 star rating (Yikes!). A lot of their reviews read like this: “I wish I had read all these horrible reviews before I went with ‘company name’. Here’s another less than stellar experience to toss on the pile.” The company’s responses (if they responded at all) just added fuel to the fire. I had to conclude then, that this company’s clientele was probably less internet savvy than the general population since they skipped any online due diligence prior to making a buying decision. This led me to ponder how their local competitors were benefiting from those prospects who did basic online research. I then began to wonder how much further their marketing dollars would go if they corrected their unattractive online persona. Here’s the challenge. This company will eventually run out of digital neophytes and find itself in a very vicious feedback loop if they don’t address this issue soon. In fact, I’d bet that even as I type this, they’re having to increase ad spend just to maintain current sales levels. Given this assumption, it won’t be long before marketing dollars alone will no longer be able to surmount the tsunami of negative online sentiment. If you’re advertising in traditional and social media and aren’t also buffing and polishing that first page of Google as a strategic matter of course, chances are you’re losing business to competitors who have made this a priority. If you haven’t done so recently, pretend you’re a prospect considering your business. Would you do business with yourself? Hopefully, the answer is yes. Otherwise…  By Scott Gordon, The Chief Revenue Officer
Many of the companies I work with do not have a formalized sales process when I arrive. In fact, most do not know how to answer the question when I ask them if they have one. To be clear, many companies hold regular sales training, but these predominantly focus on role playing and closing techniques only and do not incorporate processes of any kind (see my previous blog on this topic). In this blog, I will explore process as it relates to selling and why it’s important to manage the decision process behind every sale. Specifically, I will explore the concept of the ‘sales decision process’ or SDP. What is a sales decision process? SDP is the series of defined steps or milestones that your sales team(s) follows with every prospect from initial contact through final decision. These steps often include some or all of the following sales activities:
A dialed in and formalized SDP combined with workflow software ensures salespeople are hitting defined milestones as deals progress through their respective pipelines by assigning them tasks with due dates, sending them reminders as appropriate, and tracking completion dates along the way. Managers are also provided sufficient insight to intervene and mentor those struggling to follow the process before they fall short of their individual revenue goals or make personnel changes as needed. Most importantly, salespeople are given a roadmap, based on proven methodologies, to get from prospect to customer in the fastest possible way using the fewest number of steps. This helps managers better on-board new hires and get them on an accelerated production ramp. A tighter, more defined sales process equates to faster sales cycles, lower costs of sale, less turnover, and a happier, more productive sales force. In future blogs, I will delve into the various steps listed above to provide insights into how your organization can implement each as you move from a ‘free for all’ sales model to one based on a tightly defined SDP that will provide better forecast-ability and more predictably results.  By Scott Gordon, The Chief Revenue Officer
Over the nearly two decades I’ve spent in sales, I’ve held many positions: sales engineer, sales executive, sales manager, director of sales, vice president of sales, etc. I’ve also been on the buying side of the equation as a homeowner, business executive dealing with vendors, and as an insufferable American consumer. It’s safe to assume then, I’ve probably seen it all. Regardless of which side of the fence I find myself on – buyer or seller – the same patterns repeat themselves when it comes to sales people and process, regardless of industry or product. The purpose of this piece is to dive into some of the more common areas where sales professionals, by and large, can up their games, make more money, and have happier customers by adopting process. My first introduction to true sales professionals was as a sales engineer working for companies like Fujitsu and Avaya (at the time a recent Lucent Technologies spinoff). My job was to support the sales teams as a technical resource. This included attending customer meetings, learning requirements, cobbling together solutions, supporting the close, and seeing the solutions we proposed become reality in our customers’ enterprises. It was a fantastic job, not only for the excellent technical and project management experience I received, but for the exposure it gave me to sales people of every ilk. What being a sales engineer allowed me to do was observe the best sales professionals working alongside the worst while the vast majority existed in the myriad shades of gray area in between. I was fascinated how the same few sales people won every sales contest month in and month out as the worst of them complained that the contests were rigged or that the reason so-n-so always won was because “she has all the plum accounts”. As an engineer at the time, the real answer was quite obvious to me. Great sales professionals are great because they have great processes that they follow consistently while underperformers fly by the seats of their collective pants hoping others will pick up after them and/or dump leads in their laps. Additionally, top performers learned the corporate processes necessary to see a sale through to implementation while their low performing counterparts delegated responsibility for corporate process to back office bureaucrats who had never set eyes on a customer. To add insult to injury, often what these low performers turned in contract-wise was incomplete (since they didn’t understand the process) and required incessant follow up by customers and support staff to correct – costing everyone time, money, and goodwill. I learned early on that sales people who use process in their businesses spend less time doing unproductive tasks (like chasing paperwork) and spend more time with their customers closing deals. They exerted far less effort to make far more money. Sales process is understanding not only what tasks need to get done in a day, week, and month, but doing them at the right time, with the right people, in the right order to achieve maximum impact. This often requires a bit of vision. Working backward from a goal – I need to sell $1M worth of software licenses this quarter to make quota is a start. Better is – I want to earn $500K this year – how do I do that? This is especially powerful if your stated income goal exceeds what you’ll be paid at plan since it will require you to stretch a bit to exceed quota. Now that you know how much money you wish to make, it’s as simple as figuring out the process to get there – your roadmap. This takes planning and later working that plan until you’ve achieved or exceeded your goal. Discipline is the act of remembering what it is you truly want. If you had to drive from Los Angeles to New York City would you jump on the 10 freeway, head east, and hope for the best? Of course not, but sadly this is how many sales people run their businesses. They get on the road (quota) and see where it takes them (underperformance or worse). As a consumer of everything from automobiles to windows, I’m shocked at how often a salesman comes to my house, pitches me, leaves a proposal, and disappears for all eternity never to be heard from again. I will only do business with sales professionals who follow up with me incessantly – to the point of being annoying. Why? There is a much higher likelihood that ‘follow-up’ is a part of their process and, as a result, they’ll see the project through to completion. Their reward? A consistent and growing stream of referrals from happy customers. You see, good process also means less prospecting as time goes on even as your sales volume increases. Customers who are the recipients of good sales and operational process are happy customers and happy customers are referral engines. Referral sales carry the lowest cost and require the least amount of effort of any acquisition channel. When I later entered sales management, I was floored by how often good closers turned in half-baked contract packages. Well, nothing gums up a construction project faster than incomplete paperwork. The project manager chases the salesman, then the customer, and finally a manager who can step in and force the salesman to do his job or has learned it’s far less painful instead to make a quick phone call to the client followed by a Docusign to mop things up on the low performers behalf (if you’re a manager and you’re doing this today, you need to stop – immediately). In this scenario, nobody is having a good experience (most especially the client) and the company in question is shelling out scarce financial resources to do something over and over again that the salesman should have done correctly in the first place. There was a time when I looked at underperformance as an issue with personal motivation. In other words, I believed low performers were lazy. While I must admit that experience has proven that many of them are lazy, most of them aren’t. They simply don’t know what they need to be doing to be successful:
The results are predictable – if you don’t know where you’re going, you’re never going to get there. Lack of training equates to lack of process which leads to fewer sales with higher costs. Another less talked about issue is the fact that, unlike operations folks, salespeople, by and large, are not linear thinkers. Thus, following steps (no matter how simple) is often less natural for them. Therefore, it’s imperative that successful sales organizations make the adoption of process a natural part of the sales function. This is best done by discussing with prospective sales candidates what a typical day, week, month looks like from an activity standpoint during the interview process (and not hiring those who can’t answer the question) while in parallel implementing intuitive process driven systems for them to use once onboard with the training regimen to support adoption. These systems should not just metric and measure activity levels, but be smart enough to suggest and direct sales professionals to those activities with the highest return on time invested. These activities should reflect the best sales practices of the firm’s selling methodology and be based on real world sales data collected over time. Sales is the lifeblood of every organization. If your sales are suffering, if your sales organization is a revolving door, chances are you need a sales methodology and a process to ensure its adoption more than you need a pile of new sales people (sadly most organizations believe the inverse to be true). Until you fix the root cause of soft sales (training & process), missed targets and gross margin will continue to leak out of those sales revolving doors like cool air conditioning on a sweltering summer day. The sooner you get started, the better. What are you waiting for?  What is Your Solar IQ?
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AuthorScott Gordon, The Chief Revenue Officer (CRO) Archives
March 2018
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