Posted by Bob Apollo on Tue, Aug 24, 2010
In my previous article on the Buyer's Journey, I set out our latest thinking on the nature of the B2B Buying Process. In this article, I want to examine some of the implications of the Buyer's Journey for the B2B sales and marketing process.
If you recall, I described the B2B Buying Process in terms of consideration phases and decision gates.
Each consideration phase reflects an important step in the buying process. These phases are separated by decision gates.
Each decision gate represents vital evidence of commitment on the part of the prospect.
We've found the distinction between phases and gates to be significant when designing, measuring and managing sales and marketing processes.
Consideration Phases
Each consideration phase in the buying journey is marked by changing priorities, attitudes and behaviours on the part of the prospect. If they are to align their sales and marketing activities with the prospect's priorities, vendors need to consider:
- Which roles are likely to be involved at this phase in the process?
- What are likely to be their most important needs?
- What might cause our prospect to move forward to the next phase? How can we help?
- What might cause our prospect to hold back or abandon the journey? How might we reduce the risk?
- What tools do we need to facilitate this phase of the buying process?
- What could we be doing to requalify the prospect's interest and motivations?
- How long has the prospect been at the current phase of the process?
- What evidence of progress should we be looking for?
- How should we be prioritising and focusing our activities?
It should come as no surprise that the sales people - and sales organisations - that have been able to anticipate their prospects' most important needs at each stage in the process show consistently shorter sales cycles and higher win rates.
Decision Gates
The correct identification and diagnosis of the status of decision gates is the critical factor in accurately placing prospects at the correct phase of their decision making journey. Decision gates offer tangible evidence of prospect commitment and progress.
Depending on the phase of the project, sales people need to consider:
- What evidence can we uncover about the buyer's current intent?
- Can we win? What would it take to win?
- Have we identified, and has the prospect acknowledged, a catalyst for change?
- Are we sure that someone in authority has committed the necessary resources?
- How many proposals has the prospect received, and what criteria are they using to evaluate them?
- Are we in the lead? How can we be sure? Have we been selected? Have all other options been rejected?
- What's the approval process? Who is involved? What do they have to do before placing an order?
When it comes to decision gates, in the words of sales trainer Rick Page, "hope is not a strategy". Sales people must be encouraged to look for tangible evidence of buyer behaviour and intent. Sales managers should not allow sales people to advance deals to the next stage in the sales process without it.
Diagnosing and Dealing with Bottlenecks
Focusing on the buyer's journey has another advantage - it enables vendors to anticipate, diagnose and deal with the bottlenecks and constraints that commonly delay or derail buying processes.
A determined effort to understand how prospects are moving through their buying journey usually throws up a handful of common choke points that - if systematically addressed - will enable opportunities to move from one phase to the next faster.
Timing is Everything
Getting involved early is a critical success factor for most opportunities. It's widely recognised that vendors who only get involved after an RFP is issued have a small chance of winning unless they can do something to reshape the propect's agenda.
The earlier vendors get involved in the buying process, the better. Recent studies confirm that sales people who connect with prospects in the "window of opportunity" between a catalyst for change being identified and the formal search for solutions being initiated - while the prospect is still assessing the impact of the change - enjoy win rates 4-5 times higher than the average together with significantly shorter sales cycles.
There's an important implication for marketing here: vendors need to position themselves as experienced change agents - and as experts in change management - when it comes to addressing the most common issues, trends and challenges in the markets they have chosen to serve.
Making the Economic Case for Change
Vendor marketing activities should focus on anticipating common catalysts for change and position themselves as the place to turn to for advice when they are recognised by the prospect. Once engaged with the prospect, the vendor should focus on establishing the economic case for change - and identifying the potential consequences of inaction.
In many early buying processes, it's more important - and ultimately more valuable - to concentrate on identifing the case for change (or qualifying out opportunities where this is weak) rather than prematurely diving into the details of the vendor's solution.
Facilitating the Buying Process
Have you established the typical buying processes, consideration phases and decision gates in your target market? Are your sales and marketing activities consciously targeted at facilitating your prospect's buying process? How are you helping to establish the economic case for change? And where are the typical choke points in the buying process, and what are you doing to deal with them?
Posted by Bob Apollo on Thu, May 27, 2010
Regular readers will recall that I've been pleased to republish a number of guest blogs from Donal Daly of our partner the TAS Group. Here's an article that he first published a couple of months back on the Sales20Network that I am sure you'll find fascinating.
Over to you, Donal:
"There is much debate about what makes a good sales person, or indeed whether you can actually ‘make’ a good sales person. The debate of selling as a science or art continues to elicit much passionate discourse. What’s the role of sales training? Does how the sales person is compensated make a big difference? Does marketing drive sales or sales guide marketing? Why are there no (or few) professional qualifications for sales people? How come there are no standard measures? How can I get the most out of the sales team I have?
Sales fuels growth – and many reports have been commissioned on how to identify, hire, fire, coach or motivate a sales team to produce that growth. Depending on the audience, the answer to ‘What motivates a sales person?’ varies. Well, the survey results are in, and the answer is clear. But the important action for you to take right now is not to sit back and go “Hmm, that’s interesting”, but rather to think about what it means to your organization.
But first, the background …
I conducted a simple poll of the LinkedIn membership to answer a simple question:
What motivates sales people?
- Compensation or Incentives
- The thrill of the chase
- Making progress or winning
- Recognition
As I write this, there were 129 respondents, and though that is not a huge sample size, my experience with these kind of surveys would suggest that the percentages don’t change much after the first 50 or so respondents – assuming you’re targeting a fairly homogeneous group. So, I’m pretty confident that the responses here are sufficiently representative.
As you can see from the chart below, the overall results from the survey would suggest that what keeps the sales professional fired up and motivated is tangible evidence of making progress (40% of respondents). ‘Compensation or Incentives’ is strong second (at 35% of respondents) , but you will see that the gap increases when you look a little more closely.
Overall Results
Now, stop for a minute and think about how your organization provides you, or your sales team, with tangible evidence of progress. As the sales person progresses a sale, does sales management coaching measure progress against evidence of customer actions? Is it all about activity? Does the CRM system provide feedback to the user on the progress they are making – or is is just used for data entry to supply management with whatever reports they need.
When you further analyze the data, and look at if from the perspective of different job functions, you will see that from the sales professionals’ perspective, ‘Making progress or winning’ (at 67%) is the clear leader in the motivation stakes. It’s interesting to note that Consultants have it so wrong. Remember the old adage that says “Those who can, do; and those who can’t consult.” Be afraid – be very afraid.
Results by Job Function
As one of the respondents to the survey commented “So, maybe we’re not just money grabbing leaches after all.” Sales people, like everyone else, need to feel good about the job they do every day. Not every day is going to be a day where you close a deal. Sales is a profession peppered with rejection and disappointment, and it’s only those who have planned out their path to success, and have put in place a mechanism to measure progress against that plan, who can exhibit the necessary resilience to make success a pattern.
When we (The TAS Group) ask our existing customers what they like about the Dealmaker Sales Performance Automation platform, one of the most common answers we get from individual contributors and sales management alike is “We can always see when we are making headway. It’s not just like the CRM black-hole.”
One of the most interesting findings from this poll was the variances in response across age groups. Is this representative of an evolving shift in values? It is a sign of the impetuosity or impatience of youth – in this increasingly interrupt-driven environment? As you can see in the chart here, younger respondents want feedback – and they want to see progress, and they want to see it now.
Results by age categories
I found the results of this survey to be at once interesting and uplifting. For those who are open to interpreting it this way – it removes, or at least dilutes, the stereo-type of the snake-oil salesman. Sales people, like everyone else, want to feel good about themselves, every day, one small win at a time.
We shouldn’t ignore this when we think about how we manage, and might perhaps consider what one thing we can change to leverage this inherent attribute to accelerate revenue growth."
So - if you're a sales manager, how do these results relate to your experience? And if you're a sales person, do these findings reflect the way you feel? Or is something else motivating you?
One more thing: if you would like to learn more about how sales process equals sales success, you can complete a form to down load the TAS Group's recent white paper on the subject here.
Posted by Bob Apollo on Tue, Apr 20, 2010
Let’s face it, in almost every b2b sales organisation, there’s far too much valuable selling time going to waste. It’s being wasted on pursuing poorly qualified opportunities that are never likely to buy from you - and even in well-qualified opportunities, it’s all too often wasted on activities which are going to have no impact on your prospect’s buying process - or your chances of winning.
Think for a moment about your sales pipeline. How many opportunities are required at the top of the funnel in order to close one sale? However well your team is performing, the end to end conversion rate is almost certainly at a level that no operations manager could accept in a manufacturing plant. And if they did, they wouldn’t be keeping their job for much longer.
The analogy is a useful one, because although I understand very well that there’s a world of difference between building a standardised product and selling a complex solution, some of the ways in which we measure manufacturing performance have useful parallels in the sales environment.
Manufacturing companies have a real focus on getting things right first time. They go out of their way to engineer scrap and rework out of the process, through measures like rigorous raw material quality standards, templates, standardised machine setups, and so on. And if a component is going to fail, they want it to be rejected early, before a great deal of value has been added to it.
It’s not so different from running a sales pipeline. We want to be working well qualified opportunities and to prevent unwinnable deals from entering the pipeline in the first place. And if we’re going to lose, we want to lose early, before a great deal of wasted effort has been invested. If only we could have the level of visibility of what’s really happening from stage to stage that the leading manufacturers have of the products that are flowing along their production lines...
Then there’s the issue of time. Plant managers watch stage times like a hawk. If work in progress is taking longer than expected to move from one stage to the next, or showing unnaturally high failure rates, they will often stop the line in order to fix the underlying problem. Imagine how much more effectively we could manage sales pipelines if we better were aware of deals that were getting “stuck” at a particular stage without moving forward...
So what can we learn from the manufacturing experience? Firstly, even the sale of complex solutions will benefit from having a well defined sales process that draws upon the winning habits of your top performers, together with the best practices that can be observed in other high-performing sales organisations. CSO Insights concluded that companies with a defined, dynamic sales process outperformed their peers by a third or more in factors like the percentage of reps making quota.
Next, we need to instrument the pipeline so that we can measure deal velocity and stage to stage conversation rates, and see how performance is affected by factors like the product, salesperson and lead source involved. We need to take steps to diagnose and deal with the root causes of poor performance. And we need to trigger an alarm when a deal falls outside desirable performance standards.
And finally, we need to use the information to systematically identify the bottlenecks and constraints that are slowing sales or restricting our win rates, set high standards, and perpetuate winning habits. You might want to start with your CRM system. Does it truly embrace and encourage best practice, and is it providing you (and your sales people) the data you need? And if not, is the problem really with the software, or how it is being used and managed? It might be time to re-engineer your sales production line.
By the way, if you are interested in other techniques that can make the leap from manufacturing to selling, you might want to learn more about the Theory of Constraints and Lean Six Sigma.
Posted by Bob Apollo on Wed, Aug 12, 2009
The latest McKinsey Quarterly carries a great article on the consumer decision journey - and shoots holes in the now outdated “sales funnel” metaphor. Whilst the piece focuses primarily on B2C buyer behaviour, our own observations suggest that many of the principles are equally relevant to the process of B2B buying.
The authors explain that the linear process concept implied by the “sales funnel” – although attractively (and deceptively) simple – no longer reflects the complexities of today’s customer decision journeys. It fails to capture the many touch points and two-way interactions that are a consequence of an increasingly well-informed, networked and discerning prospect community.
Ease of access to internet information, and the increasing importance of word of mouth, recommendation and reputation in the B2B buying process has transferred information power into the hands of the prospect. It’s no longer unusual for the group of potential solutions being considered to expand, rather than narrow, at some stage in the decision journey before the choice of what (or if) to buy is made.
Trigger Events
McKinsey highlight the importance of trigger events – something we’ve written about before – that kick-start the customer decision journey in the first place. As we’ve pointed out, in the world of B2B, these trigger events can be internal to the organisation (such changes in staff, responsibilities or circumstances) or external to the market (such as major changes in technology, legislation or the balance of competition).
At first the prospective buyer may either be unaware or unconcerned – but then something happens (the trigger event) to raise their awareness that they have an issue that they need to deal with – and the search for a solution gets underway. McKinsey see the B2C process as a circular, rather than a linear journey, with four potential battlegrounds where marketers can win or lose: initial consideration, active evaluation, closure through purchase, and post-purchase.
These are closely analogous to the four key stages we have identified in the B2B customer decision journey: get connected, get considered, get chosen and get recommended. McKinsey point out that once they have defined an initial vendor consideration set, consumers then tend “shop a category” which may result in additional vendors being included in their evaluation – exactly the behaviour we have observed in B2B, and highlighting the critical importance of being found in the right categories when prospects start searching for solutions.
At each stage in their respective buying processes, both B2C and B2B customers face the choice of continuing, pausing or abandoning their decision-making journey, and adding, continuing with or subtracting vendors from consideration. Prospects of both types seem to have a strong preference for “pulling” the information they need to make these decisions rather than having it pushed at them by vendors, and to place greater trust in third party validation than in vendor messaging.
B2Both
So, although the McKinsey survey focused only on B2C behaviour, we should not be surprised to observe similar things happening in B2C, or to find that McKinsey’s recommendation – that vendors align their marketing efforts with the customer decision journey – are equally relevant to the world of B2B sales and marketing.
We’ll be publishing a series of connected blogs over the coming weeks, but I’m interested in your perspective – what can we as B2B marketers learn from this study? What other parallels have you observed?
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