Posted by Bob Apollo on Thu, Jul 15, 2010
It’s an old story, but one that I still hear far too often. Salespeople complaining that marketing never generates any decent leads. Marketing getting frustrated that sales never follows up on the leads they have created. And, amusing though the idea might at first appear, we can’t excuse it by claiming that “Sales is from Mars and Marketing is from Venus”.
I should probably have put the word “leads” in quote marks. It’s not unusual for part of the problem to stem from a failure to agree what a sales ready lead looks like, or to get confused between an enquiry, a lead and an opportunity, or even (bizarre as it may seem) to regard those three categories as being in some way interchangeable.
Creating a contract between sales and marketing
But the real root cause predates even the enquiry-lead-opportunity definition problem: it arises from the failure to agree and define what an “ideal prospect” looks like. Without a consensus about the characteristics of a well-qualified prospect, marketing are likely to continue investing resources targeting people who are never likely to buy - and sales will be unable to sign up to a contract with marketing that basically says “find opportunities that look like this, and we will commit to pursue them”.
What does an ideal prospect look like?
I’ve conducted a number of ideal prospect profile exercises with clients - I have come to regard them as the essential foundation for making smart sales and marketing investment decisions - and here’s what I’ve learned:
- Demographics alone aren’t enough. The classic dimensions of market segmentation - industry, geography, company size, etc., form the foundation of an ideal prospect profile, but they are by themselves insufficient
- The devil is in the detail. When you evaluate recent sales successes, you can usually uncover more subtle characteristics that have a more important predictive effect. Things like existing systems in use often have a profound impact on the chances of sales success
- Don’t ignore behavioural factors. Years ago, when I was working at HP, we uncovered something that had far greater impact than any demographic factor: companies that were highly decentralised (like HP) tended to prefer to buy from HP. Companies that were highly centralised (like IBM was at the time) strongly preferred to buy from IBM
- Look for patterns. A more recent predictive factor has emerged from my work with SaaS based offerings: for reasons that are fairly simple to understand, companies that have already signed up for one SaaS based solution are far more likely to buy additional ones. The pioneering work has already been done
A few simple recommendations...
Here’s what I’d recommend to any organisation that wants to leverage the concept of “ideal prospect profiles” to dramatically increase sales and marketing effectiveness:
- Establish ideal prospect profiles for each of your significant product or service offerings as a collaborative exercise between sales and marketing. Be sure to combine demographic, environmental and behavioural characteristics
- Make a determined effort to progressively enhance your target account prospecting database by capturing the characteristics of your “ideal prospects”. Include this learning in the information you collect in web form submissions, etc.
- Help prospects to self-qualify by explaining how your solution is particularly relevant to organisations that exhibit the characteristics of your “ideal prospect profile”. Ensure that your case studies and reference materials support this
- Encourage sales and marketing to enter into a contract based on the commonly agreed characteristics of an “ideal prospect” that ensures that if marketing uncovers a suitable candidate, sales commits to follow them up
- Implement a continuous qualification process that helps marketing and sales to judge - in an evidence based way - just how good a prospect any given enquiry, lead or opportunity is likely to be
Trust me, it will be worth the effort...
Get this right - and continue to refine it - and from all my observations, you’ll spend your marketing money far more wisely and apply your sales resources far more effectively. And both departments will enjoy working together.
Posted by Bob Apollo on Thu, Jul 01, 2010
I’ve lost track of the number of companies who proclaim that they are embracing a “value-added” strategy in order to differentiate themselves in an increasingly commoditised market. They often see it as their best chance of breaking away from relentless pricing pressure and a highly competitive sales environment.
Many have thrown enormous sums of money at trying to move up the solution value chain without successfully changing a sales culture that is still rooted in selling simple product offerings and lacks the experience or credibility to deal with the buying processes that are associated with evaluating complex solutions.
Value-added - or cost-added?
So why do so many of these “value-added” initiatives manifestly fail to deliver the hoped for results? And why in many - maybe the majority - of cases, do the initiatives turn out to be nothing more than “cost-added” strategies that only serve to further depress the profitability of the organisation without actually moving the dial when it comes to sales win rates?
In my experience, most of these initiatives make no attempt to confirm that their various so-called “value-added” activities have any meaningful value to the prospective customer, or are likely to positively influence their behaviour. In fact, all-too-often they reflect the misapplied imagination of a product marketing manager about what matters to customers they have spent all-too-little time trying to really understand.
It's what the prospect is prepared to pay for...
I propose the following test of value added: “that which a well-qualified prospective customer proves by their behaviour they are willing to invest their time or money in, which materially advances their buying cycle, or increases the chances of them making a positive buying decision”. In other words, we shouldn’t be doing anything that a prospect isn’t prepared to pay for with their time or money.
Of course, there is a big problem implementing this thinking in an environment which is focused primarily around a vendor’s sales process. But when you turn the telescope around and look at matters from the perspective of the buying process, and what it takes to persuade your prospect’s decision making team to move forward from stage to stage, you can much more easily identify where the real value added lies … and where all the potential sources of wasted effort might sit.
Are your "value-added" efforts wasted?
Take a look at your sales and marketing actions? Can you identify where and how they add value to your prospect's decision-making process? And if not, how much more effective could your organisation be if you saved that money and effort or re-purposed it to a better cause?
Posted by Bob Apollo on Sat, Jun 05, 2010
I came across Simon Sinek's work through a blog post by Augie Ray of Forrester. Sinek is the author of Start With Why. In the following video, he explains why great leaders, and great companies, don't start with what they do, but with why they do it.
To take just one convincing example, he observes that (unlike so many of our current generation of politicians) Martin Luther King won his followers over not by having a plan, but by having a dream.
Sinek goes on to suggest, in a powerful and compelling way, that great organisations succeed by doing business and attracting followers (buyers, employees, influencers, etc.) who believe what they believe.
Invest 18 minutes in watching this video, and then reflect on whether, at the heart of how you communicate, you are leading with "why" - or with what... and whether you are driven by a cause, or a belief, that you and your organisation are passionate about.
Posted by Bob Apollo on Thu, May 13, 2010
There’s a short article in the latest McKinsey Quarterly on “the basics of business-to-business sales success”. It captures the conclusions from their survey of more than 1,200 purchasing decision makers in small, medium and large organisations across the US and Europe who are responsible for buying high-tech products and services.
When McKinsey asked them what drove their buying decisions, although these buyers might have initially suggested that price was key, the two most important factors actually turned out to be product/service features and the overall sales experience. No great surprise there, probably.
Destructive sales behaviours
But then the question turned to the “most destructive” sales behaviours – the ones that were likely to cause vendors to lose an otherwise winnable deal. And that’s where I become concerned that the survey – although useful – may not be reflecting the complete picture in the complex high-end B2B sales environment in which most of my clients operate.
According to McKinsey, the greatest sales sin was “too much communication” in person, by phone or by email, followed by lack of knowledge about either their products or those of their competitors. More than 6 times as many respondents complained of “too much communication” than those who complained of too little contact.
Can you over communicate?
So how are we to interpret this data? First, I need to introduce the caveat that the survey appeared to span simple to complex products, and I think we all know that complex sales have important nuances that don’t apply to commodity purchases. Second, the number of options open to those surveyed seems to have been restricted.
But even with these reservations, the conclusion that you can over communicate with your prospect appears troubling in a world of multiple touch points. So I went back to the quantitative buyer research I’ve conducted in behalf of B2B clients – all of them involved in high-value complex sales – and I think I have at least one probable explanation.
Ensure that your prospect feels they are learning something
In almost every conversation with people involved in the B2B buying decision making process, I hear something along the following lines “for as long as I’m learning something, I’m prepared to listen. But as soon as I detect a sales pitch, or feel I’m being chased, I switch off”.
So I’m coming to suspect that the real problem is not the frequency of the communication – but the relevance of the message to the buyer. Repeatedly contacting the buyer to ask if they have made a decision yet is likely to be counter-productive. But sharing some potentially valuable insights with them is likely to be taken in a completely different and more positive light.
Building rapport - ensuring relevance
So when I’m coaching sales people I strongly advise them to build a level of rapport with their prospects that allows them to understand what they are interested in – and to selectively identify insights and news items and to share learning from other similar customers that is likely to be of interest to their client and can help to sustain a continuing dialogue.
So – do you think that it’s possible to over-communicate with prospects, and what techniques have you found to avoid being seen as a bore?
Posted by Bob Apollo on Wed, May 05, 2010
Many B2B-focused organisations to prefer to talk in terms of delivering “solutions” rather than selling products. CEOs speak about becoming solution-driven rather than product led. But, as I’ve observed in a previous article, that transition is by no means straightforward – or necessarily appropriate.
The s-word is over-used and frequently misapplied – to the extent that British satirical magazine Private Eye used to have a column that regularly poked fun at the worst excesses, including one hapless vendor that described the humble cardboard box as a “flexible storage solution”.
Solving the solutions problem...
Before accepting any more abuses of the English language, it’s probably worth getting back to basics. Dictionary.com defines a solution as “the act of solving a problem”. It’s clear (or it ought to be) that without a problem, you can’t have a solution.
But there’s a world of difference between identifying a potential problem and understanding its implications for your potential prospect. Many sales people suffer from what I’ve described as a premature elaboration problem – they rush to propose a solution at the first sign of an apparent problem.
Diagnose before you prescribe...
This is not only irritating for the prospect, it’s deeply damaging to the sales person’s chances of success. Research by the TAS Group and others has shown that sales people who take the time to diagnose the prospect’s underlying issues and carefully qualify the real opportunity enjoy dramatically better success – in terms of increased win rates, higher deal values and shorter sales cycles – than their over-impatient peers.
You can’t offer a complete solution until you understand the whole problem...
I’m often told by my client’s prospects that “as long as I’m learning something, I’m willing to listen. But as soon as the sales person starts pitching to me, I lose interest”. Your prospect’s first acknowledgement of an apparent problem should always be used as an opportunity to explore, to really get to the heart of the matter, to open doors rather than to slam them shut - and to uncover the whole problem.
Understanding the “whole problem” includes identifying who else is affected, determining the consequences of preserving the status quo, and – perhaps most important of all – understanding what else would need to change before a solution could be agreed and implemented.
Only then are you going to be in a position to propose a solution that addresses all of the implications of your prospect’s current situation and which stands any realistic chance of resolving the real issues.
Solutions are an exercise in change management...
Many sales people under estimate the degree of change required for a proposed solution to be effected. Some deliberately shy away from confronting the complexities in the hope that this will simplify the sale.
But this is a bad tactic on two levels: first, the buyer is going to have to navigate these complexities anyway with or without your help before they decide if and how to solve the problem, and secondly, if you do succeed in winning a sales where your new customer is faced with unanticipated issues, it’s going to do nothing to improve their chances of finding a complete resolution to their problem or of becoming a loyal, dedicated and profitable customer in the longer term.
Improving your problem solving skills...
So how can you systematically improve the problem solving skills of your organisation, and enhance the quality of the solutions you provide to your customers? At the risk of prescribing before I’ve had the chance to diagnose your unique situation, here are a few pointers from other organisations that appear to exemplify best practice in this area:
- Learn from the winning habits of your top sales performers – what questions do they ask, and what techniques do they use to qualify prospects during the all-important need identification stage of the sales process?
- Encourage all your sales people to adopt a questioning framework that really gets to the heart of the problem, rather than accepting the prospect’s first acknowledgement of a solvable problem as their signal to propose a solution
- Ensure that your sales people explore the consequences of the prospect simply continuing to live with the status quo – and identify who else would be affected
- Never underestimate the degree or scope of change within your prospect’s organisation that may be necessary before a complete solution can be achieved. Expose and confront the issues rather than sweeping them under the carpet
Please share your comments and experiences. And if you’d like to hear more about what I’ve learned from observing best solution selling practice across some of the top-performing B2B sales and marketing organisations, please drop me a line at bob.apollo@inflexion-point.com or give me a call on +44 7802 313300. I look forward to hearing from you.
Posted by Bob Apollo on Wed, Apr 28, 2010
Your customers, and your prospects, have opinions - and they are fascinated by the opinions of their peer groups and others they have come to trust for advice. They no longer have to rely simply upon the views of people and organisations they already know – our networked world has made it easy for them to seek and share opinions on a global scale.
The term “word of mouth” marketing is something of a quaint misnomer. One-to-one verbal communication is only one of its' manifestations. The phrase is now commonly (and, I think, appropriately) used to describe customer-to-customer communications across a variety of media that share a common characteristic – the participants have no direct personal economic interest in the information they are exchanging, simply a desire to share what they have learned for the common good.
Time to shove “push marketing” to one side...
As the April 2010 issue of the McKinsey Quarterly points out, customers have become increasingly sceptical about traditional “push” marketing techniques and prefer to make their purchasing decisions based on information that is independently sourced, rather than what the vendor or their sales person tells them. Whilst the McKinsey article has a primarily B2C perspective, the principles are equally - perhaps even more - relevant to the B2C environment.
Word-of-mouth particularly critical in new markets...
One conclusion, in particular, really resonates - and the implications could be profound for B2B marketers. McKinsey identified a significant difference in the power of word-of-mouth between mature and new markets. Although advertising and previous product usage continued to be the primary drivers of consideration in mature markets, word-of-mouth was the most important factor at every stage of consideration in new markets.
Let’s consider the implications for a moment – if you are involved in a new, innovative or disruptive technology, or if you are competing in new markets where you have to create, clarify or elevate your prospect’s needs before you can satisfy them, the quality of the word-of-mouth that surrounds your company and your products and services may now be the biggest single influence on whether you get considered, whether you get evaluated, and whether you get chosen.
Amplifying word-of-mouth equity...
And note that it’s the quality of the word-of-mouth, more than the quantity that affects the power of the communication. McKinsey’s research showed that a high-impact recommendation from a trusted source conveying a relevant message is up to 50 times more likely to trigger a purchase than a low-impact recommendation.
The authors go on to identify three components of word-of-mouth equity: what is being said, who is saying it, and where they are saying it. Let’s consider each of these briefly:
- What is being said is the foundation of effective word-of-mouth marketing: we need to find and focus on the elements that most influence buying decisions
- Next comes who is saying it: as McKinsey point out, the receiver must trust the sender and believe that they have relevant experience for their comments to be valid
- Finally, where they are saying it, because the environment within which the comments are being circulated has a considerable impact on the power of the messages
Applying this to the B2B environment...
We can clearly learn from these B2C experiences and best practices. So how do they change the agenda for those of us who are focused on the B2B environment? Here’s how I’d recommend you might amplify your word-of-mouth:
- Be clear about your prospect’s primary considerations when they start searching for solutions. Conversations with both your installed base and recent new customers – and specifically those in your “sweet spot” – can help. What were the things that were most important to them as they researched the market? What were the trigger events that caused them to start looking?
- Identify the trusted sources that your current customers and prospects rely on for insight and advice. Are there particular organisations or individuals that stand out? How important are analysts, journalists, trade bodies, or their other existing suppliers?
- What about their networks – formal and informal, online and offline? Are they members of relevant trade or professional organisations? How has their network landscape changed, and how do they expect it might continue to change?
You’ll find that you customers and prospects appreciate being asked. They might well be intrigued as to why you are asking. And I can guarantee that you will lean much that is of value.
Why this is worth it...
There’s a key reason to believe that mastering word-of-mouth can establish compelling competitive advantage: the ability for any vendor to outperform their peers in traditional marketing is limited, because the gains from superior performance in a broadly-mastered discipline are slim. But with so few companies truly mastering word-of-mouth marketing, the opportunities to dramatically outperform your competitors by mastering this new discipline are truly profound.
Are you deliberately factoring word-of-mouth into your B2B marketing programmes? I’d welcome the chance to learn from your experiences – and I’d be happy to share what I’ve learned. You can contact me here.
Posted by Bob Apollo on Mon, Apr 26, 2010
According to the latest research from Gartner, marketing spend amongst high-tech and technology providers is on the rise again in 2010 – after a year in which more than half of these vendors cut their marketing budgets.
But the resurrection of high-tech marketing budgets doesn’t, it seems, mark a return to a pre- recession marketing mix. According to Gartner research vice president Laura McLellan, “Marketing has to continue to look at being more efficient and cost effective” and she noted that many marketing groups were “searching for better ways to measure and show the value of marketing”.
The "new normal"
Well, hurrah to that. But what is this likely to mean in practice? Gartner predicted a “new normal” in which IT buyers rethink their spending approach and identified key priorities for many IT vendors in 2010 as sales programs to support both the direct and indirect sales forces together with increased investment in positioning and external communications.
These targeted investments are certainly consistent with some of the best practice I’ve been observing in high-tech companies that are managing to ride the rebound, rebuild their pipelines and get their sales and marketing engines running effectively again.
They reflect the two essential initiatives that we’ve been working with clients on: the clarity of their market focus and the effectiveness of their sales process.
Clarity of market focus
Clarity of market focus requires that organisations define their ideal customer profiles as well as understanding the hierarchy of needs that drive buying behaviour – but perhaps most importantly it requires a deep understanding of the sphere of influence that surrounds these prospects. Much of the increased investment in positioning and external communications will, I predict, be focused on reaching out to and through this BuyerSphere.
Effectiveness of the sales process
It’s no longer accurate (or fashionable) to describe sales being from Mars and marketing from Venus. The traditional tensions between the two functions are completely unproductive in the “new normal”, and it’s striking how organisations that have successfully aligned sales and marketing around a common focus on the customer are doing better by every important measure of performance. Gartner’s recommended focus on programs to support the sales process (and thereby facilitate the buying process) is a reflection of the growing trend towards collaborative behaviour.
Where’s your marketing money going in 2010?
How do your marketing spend priorities align with Gartner’s findings? Have you identified a “new normal” in the buying behaviours of your target markets? And have your sales and marketing teams learned to play nicely together?
Posted by Bob Apollo on Thu, Apr 22, 2010
Are you involved in selling high-value, complex products or services to a business audience? I recently suggested that most of your sales efforts are likely to be wasted - you can read the article here. But there’s no reason to let marketing off the hook.
John Wanamaker, the US department store pioneer, is often quoted as saying “Half the money I spend on advertising is wasted; the trouble is I don't know which half”. And naturally the problem is not just associated with advertising – the challenge affects every form of marketing.
Of course, today’s marketing media offer the promise of much better targeting and near-instant feedback on who you have reached and how they have responded. But technology by itself isn’t enough to eliminate the waste that is still associated with many marketing investments even today.
Marshall McLuhan believed that the medium was the message, and there’s no doubt that the media through which any message is delivered affects its form and impact - probably far more than he anticipated when he coined the phrase back in 1964.
But it’s still critically important to get the message right as well as delivering it effectively – and that involves mastering the basics of a compelling value proposition that addresses the urgent needs of an ideal customer profile. Misalign any of these three elements, and you’ll still end up wasting a great deal of your marketing effort.
And although the feedback new media provides can help you refine your targeting, it’s no excuse for laziness and there remains no substitute for creating a great brief from the get-go. So let’s spend a moment considering each of these three components.
Addressing urgent needs
Until there is a need, there can be no solution. And without a solution, there can be no sale. But there is an important hierarchy of needs, and whilst interesting needs might get you considered, and important needs might get you evaluated, only urgent needs will get you bought.
Does this imply that you should only focus on urgent needs in your campaign? Well, no – but if you choose to address interesting or important needs as well (and there’s often a good reason to, because of some of the subtleties of the human decision making process), to avoid wasted effort you had better make sure that you have created collateral and sales tools that can help these “opportunities with potential” to acknowledge that they have urgent needs.
Ideal customer profile
It’s no longer enough to rely on demographics alone (size, geography, industry, etc.) to define your target audience. Today’s best B2B marketers are also looking out for the trigger events that spark buying processes, and identifying with the behaviours and motivations of their likely champions within prospect organisations – as well as mapping the spheres of influence that inform prospect's decision making.
To avoid wasted effort, it's worth thoughtfully crafting buyer profiles (or “persona”) for these potential champions as well as the organisations they work for - and investing in influencing the people and organisations these champions are likely to turn to for advice as well as the prospects themselves.
Compelling Value Proposition
But even with intelligent targeting of needs and audience, much effort still gets wasted in the absence of a compelling value proposition. In addition to targeting your most valuable prospects, your value proposition must align your most powerful capabilities to their most urgent needs, differentiate your offering from the competition, elevate the need to act, mitigate the risk of change, provide proof to back up your claims, and make a well-chosen offer and call to action. If any of these elements are weak or missing, your value proposition is diminished – and much of your effort wasted.
Marketing is a Process, Not an Event
My final recommendation is that you consider marketing as a process, not an event. When you are selling complex, high-value offerings to a B2B audience, you can’t hope to cram all your messages into one communication. But if you haven’t anticipated what the whole story is, or where, how and when it is going to play out, your good work will still be wasted. John Wanamaker would surely not approve...
By the way, we've recently published a 2-page checklist that captures some of the lesson's we've learned from today's most scalable businesses - you can download it here.
Posted by Bob Apollo on Thu, Apr 01, 2010
In Bill Clinton’s successful 1992 presidential election campaign, a sign famously hung in his Little Rock campaign headquarters with the following simple message: “it’s the economy, stupid”.
In today’s risk-averse buying climate, the message to ambitious B2B sales professionals seeking to win the votes of their prospects might have a familiar ring: “it’s the economics, stupid”.
Rational, emotional or financial?
I don’t mean to suggest that rational or emotional factors are irrelevant to high-value B2B sales, but the involvement of multiple stakeholders and the nature of the decision making process means that economic factors - and financial language - play a central role in justifying most buying decisions.
If companies are to invest in resolving them, issues need to be associated with economic consequences, and by and large this revolves around avoidable costs or incremental revenues. Until and unless it is compellingly obvious that organisations can make or save significant amounts of money, they are unlikely to spend money on making a potentially risky change.
Return on Investment isn’t enough
Even believing that there is a strong return on investment (ROI) isn’t enough to ensure that the need to change will be accepted or that the buying decision will be approved. No matter how strong the project ROI appears to be, it never exists in isolation. It will always compete for funds against other (often completely different) projects or the attraction of simply keeping the money in the bank.
ROI models are based on assumptions that bias the conclusions (whether the assumptions are good or bad may depend on whether the vendor or the prospect calculated them), but they rarely take account of the execution risk that is associated with any change. Some projects deliver the desired outcomes, some exceed their goals, but many fail to achieve anything like the promised results, and your stakeholders are factoring this – whether formally or informally, consciously or unconsciously – into every significant decision they are called upon to make.
The least risk option
There’s a significant body of research suggesting that B2B buying decision teams are strongly influenced by the desire to mitigate risk when deciding if and how they need to implement change programmes (which, let’s face it, are what most significant purchases of complex solutions involve).
So it’s not enough for an organisation to emerge as the favoured vendor – they also have to be perceived as the least risk of all available options, including the all-too-popular decision to “do nothing” about the problem – at least for the moment.
The consequences of inaction
So it’s clear that having a compelling ROI – though necessary – isn’t going to be sufficient to win deals in today’s climate. In addition to strong benefits, vendors have to ensure that they help the prospect’s stakeholders identify, articulate and elevate the consequences of inaction. The consequences of inaction are all about what is likely to happen if the status quo was allowed to prevail.
So some of the most important questions your sales people can and must ask include “why is this issue important to you now?”, “have you tried to address this issue before, and what were the results?”, “what would happen if you failed to resolve this problem now?”, and “who else would be affected if the current situation continued?”.
Where’s the value?
These are thoughtful questions, and frequently stimulate the prospect to think differently about the issue they have described to you. They often help you gain access to other stakeholders. But you should consider it a huge red flag if despite your help and after due consideration your prospect is still unable to articulate significant economic consequences of failing to address the issue.
Even if they are keen to continue the conversation, unless you can use the consequences of inaction to elevate their need from merely interesting or important to urgent, there’s little likelihood – no matter how positive your conversation – that the deal will close any time soon.
Of course, this is not a reason to abandon the prospect – simply to recognise that there is still work to be done to educate them, and/or that you may need to wait for, or try to create, a trigger event that will serve to establish clear economic benefit, urgency, and the need to take action.
Final thoughts...
Take a critical look at your sales pipeline? How many of those opportunities are associated with a clear economic impact that has been acknowledged by the prospect? How many of them are associated with clearly defined consequences of inaction? What does this understanding do to your sales forecast? And how can you help your sales people, and your prospects, to eliminate risk and create an unimpeachable (back to Bill Clinton again) case for change?
Posted by Bob Apollo on Tue, Mar 30, 2010
Is your offering a discretionary purchase for your customer? Do you often find yourself having to create needs? Does your true competition include not only other similar vendors, but also other completely different projects, and the possibility that the prospect will decide to “do nothing”?
Are your sales pipelines clogged up with opportunities that have expressed interest but now seem to be going nowhere? Do deals get stuck at critical points in the buying cycle? And are your sales people reporting that their “usual suspects” are nearly ready to close – quarter after quarter?
It’s a common situation. And the common explanation is that what you have to offer may be interesting enough for your prospects to want to learn more, but that their current situation is not yet uncomfortable enough for them to conclude that they have to act...
Challenging the status quo
Most systems – and most organisations – have a tendency to perpetuate the status quo unless challenged by a critical need to change. And today’s risk-averse climate has had the effect of raising these invisible organisational barriers to change.
Risk aversion hasn’t necessarily dimmed your prospect’s curiosity or their desire to educate themselves about trends that might affect them. But it has made it harder for vendors to persuade their prospects to convert curiosity into action, and to make a purchase decision.
In the void between pain and ambition
Most discretionary business purchases are driven by one of two motivations – to either solve an existing problem or to take advantage of a new opportunity. They are catalysed by either pain or ambition.
But unless and until the problem is acute enough, or the opportunity compelling enough, no purchase will be made. Conversations may certainly continue – and sales people may come to believe they are making progress. They may even hope that a deal is in the offing.
The opportunity will remain trapped in this widening void between pain and ambition until the economic consequences of failure are so blindingly obvious to the prospect that all the stakeholders involved can align around making the decision to take action.
Identifying the economic consequences
The nature of many discretionary purchases is such that the organisation may not already have a budget set aside for them. The budget will have to be found – and since it is unlikely to be created out of thin air, the probability is that the money will have to be redirected from some other source.
But before this can happen, and even if the new initiative appears to support a strategic priority of the organisation, the economic consequences of a failure to act must be crystallised and acknowledged by the prospect. Having a robust ROI is not enough to secure a purchase decision – prospects have to associate a painful economic consequence with preserving the status quo.
“Who else is affected?”
The status quo creates its own supporters naturally, but change has to recruit its champions. So it’s critically important - once pain or ambition is acknowledged by the initial contact within the prospect - that the sales person identifies other stakeholders who are affected by the issue, and finds reasons to connect with them.
The goal here must be to establish a network of affected and influential stakeholders, each of whom has declared a vested interest in dealing with the issue. And whilst paying attention to the most senior decision maker is clearly a critical factor, given the growing number of people involved in today’s decision making processes, winning a groundswell of influential support can make the difference between securing an order or being told that the prospect has decided to “wait and see”.
Avoiding the void
So how can vendors avoid the void between pain and ambition? I’d like to offer five recommendations:
- Ensure that you understand the nature of your prospect’s problem or opportunity - and if you can’t find a compelling one, ask more questions or qualify out. Focus on the economic consequences, and the cost of inaction
- Use every acknowledged problem or opportunity to explore who else is affected, and how. Systematically build a network of involved stakeholders
- Apply a zero value to opportunities in your sales pipeline unless and until the prospect has acknowledged an economic consequence which is at least as large as the cost of acquiring your solution
- Actively manage your sales pipelines with brutal honesty rather than misplaced hope. Base pipeline stages on buying behaviour rather than sales activities. Insist on observable evidence of a change in the prospect’s commitment before promoting them from one stage to the next in your pipeline
- If you find that a prospect is stuck in the void between pain and ambition, recognise that this is a problem and brainstorm strategies to resolve it. If you can’t, resolve to nurture that prospect until the problem can be elevated, and look for other opportunities that have stronger motivations to act now rather than in the future
A final thought
In this area, as in so many others, hope is not a strategy. Adopting a systematic approach to qualifying sales opportunities and managing sales pipelines is more important than ever.
It’s possible to be so close to your current sales and marketing processes that you fail to see the wood for the trees. You might be surprised by what insights an external perspective can bring. I’d be happy to share what I’ve learned with you.