Sales & Marketing Strategies: GPS For Your Business

Author: Valerie Dennis

Business owners have a lot to accomplish in a day, week, month or year. On most days, you may feel like you have all the symptoms of ADD because competing priorities don’t work on a schedule. So when the subject of sales and marketing comes up, it almost becomes a philosophical debate. How do justify the time and money for something that seems a bit intangible? Websites are great and sometimes really cool, but…will they make a sale? Sales and marketing efforts are not just about your website–that is a subset , a tactical element. You can have a really great product or service, but it is the strategies that will get it to market and build a sustainable sales pipeline. In other words, the best products and services don’t sell themselves—at least not for long. If they did, we wouldn’t have sales and marketing people—how dull would that be?

In a conversation recently with a prospective client, we were talking about how they invest in their client for the long-term—adding ongoing value and aiming for the sale after the sale. It is a good way to look at marketing and sales strategies, consider them critical investments. They are the roadmap for how you are going to grow—and keep growing. That’s worth time and money, right?

When might you need such help? Examples include: Before you enter a new market or start a company, if you want to validate a business concept, customer needs are evolving, introduce a new product or service, you need accelerated growth or greater differentiation, you want to find the next big thing, there’s an increase in competition and a loss in market share, or sales have stalled or declined.

What is interesting is that when we are the purchaser, we tend to weed out the “Me too” category. When we buy a car, running shoes, groceries, look for a doctor or day care, etc. we do our homework because there are a lot of options to choose from and places to buy. As the seller, we sometimes think our benefits are obvious. They might be—but there are lots of options to choose from and places to buy…and your prospective customer will do his homework. It starts with the basic premise if you aren’t easy to find or you didn’t find them, you’ve lost the prospective sale.

Naturally, we want the sales to keep rolling in and we want our customers to recognize our value. Some might say that their businesses are growing by referral. Perhaps for a lucky few that happens. But I would tell you that time and again businesses eventually need to rebuild the pipeline because referral business was only good for a while.

In the simplest analogy, sales and marketing strategies are like GPS—it will get you to the right place, unless you have a bad address and an ill-equipped vehicle. Here is what you want to know:

• you need an accurate address to get you to the right place, at the right time. (I.e. lead generation, sales prospecting, market research)
• your “hosts” need to know who you are and why they should talk to you—rather than your competition (I.e. brand, key messaging, differentiation, competitive analysis, product marketing)
• you need to know how many others are just like your current “host”, who might also buy from you (I.e. prospecting, channel development, sales pipeline)
• you need to know when to visit, what to say, how to say it and how to keep them talking to you (I.e. qualifying a prospect, sales strategy and process, marketing and communications)
• you want a reliable vehicle—does your car break down on the side of the road or is it shiny and new, with a navigation system? (I.e. brand, channel development, marketing strategy, sales)
• you need a map to give you turn by turn instruction–not directions like “take a left at the red barn, go past the cows–the spotted ones, not the brown ones…” (I.e. strategy, sales tools, marketing, messaging, customer relationship management)
• you need a guidebook to make your “trip” productive (I.e. sales methods and tools, marketing and messaging, customer relationship management)
• you want people to invite you back—or at least welcome your next visit–and they’ll only do that if you answer “what’s in it for me?” (I.e. sales pipeline, growth strategies, positioning, ROI)

Sales and marketing strategies help you get the right address (prospects), a working vehicle (message), the most effective route (channel)…and the sale. Sales is not a passive process. It requires discipline, strategy, planning and execution. If you put time and money into the quality of your products and services, why wouldn’t you put time and money into generating revenue?

From a lot of folks I hear “I don’t have time and I don’t like to sell” and when you drill down on that statement, they will also tell you they don’t know how to sell. That’s okay. Let’s face it, sales people are a distinct breed. But in this case it’s important find someone to help you overcome these challenges. The same goes for marketing.

I realize that it is difficult to invite someone into your business to help shape your strategies. It is a matter of trust, among other things. But business is dynamic, not static. Marketing and sales plans aren’t built once and kept for a lifetime. Market indices will affect your business, your competitors will reshape your customer’s preferences or needs, or product/service obsolescence will force the change. Stuff happens. But what I have found is that with the right people in the room (ideally people with practical experience who lived through the execution of their own ideas), who genuinely want the best for your business, you will find the answers you need and perhaps even some you didn’t think about. Sales and marketing is an investment, a critical one.

Technorati Tags: consultants,sales strategy,marketing strategy,sales,marketing,growth strategy,growth,consulting,brand,channel marketing,business development

Not All Customers Are Alike

Author: Valerie Dennis

Not all customers are alike. And there may be some that you just don’t like. But for the purpose of today’s discussion, we’ll stick to the first statement. Given the fact that your customers are diverse, your sales structure and segmentation need to be anything but homogenous.

Customers can be profitable, unprofitable, growing, declining, high maintenance, low maintenance, strategic in value, high revenue, low revenue, etc. They can use up all your resources and give you very little to show for it. Your sales efforts will vary by customer type—with some being easy to sell, attain and retain. So why would you treat them all the same?

Sales structure is critical to sales success and it is often overlooked. Many companies don’t think twice about restructuring but don’t think about the new challenges it creates. For example, if you change a sales model from account management to a combination of business development and account management, you will not have a better performing model if you don’t evaluate the people and make the necessary changes.

Account managers don’t always make great business development reps and vice versa. Most account managers prefer to build long-term relationships, be the expert in the customer’s business and grow the business over time. Business development reps like the hunt, but not the long-term service and sales support of a customer. It is unlikely that you’ll be lucky enough to have each member of your sales team with those combined talents—although there are some who are great at both and like to do both.

Other misconceptions are that all selling is alike and the cost of the sale is the same. Customer segmentation is key here. The cost of the sale, the complexity of the sale and the customer value should be considered. Your A and B customers are your high revenue, high growth, strategic and/or high profit accounts. You will also have C and D customers—low revenue, profit and maintenance accounts—customers that might be better suited to inside sales support.  The key here is to match up the skills and cost of your sales force to the revenue and cost of the customer.

Restructure your customers first—A through D and align the sales force accordingly. In other words, put the right sales people with the right customer opportunities. Someone better suited for inside sales or small accounts will flounder in a national or key account. Sometimes, high growth customers are ignored, simply because they are growing on their own. I know, that’s counter intuitive but it happens. If the customer is selling themselves, so to speak, some reps will spend time where they can be more impactful. Not realizing that there is greater growth potential or that retention is also their responsibility.

Another thing to think about…“that one customer” who is HIGH maintenance. Uggh!! We’ve all had them–think about your high maintenance customer(s). With all due respect to the client, they are probably that way because the organization allowed it. As such, the cost to serve a customer is another consideration. Low revenue accounts (caveat: with no growth potential) should not get the same resources and support as your top accounts.

At the end of the day, when you look at your customer segmentation and sales structure, a compelling goal is to provide the right experience and value to your customers. These changes will help you optimize your selling, manage your sales costs and create the right customer experience.

 

Technorati Tags: customer segmentation,sales,sales structure,account management,business,selling

Are Your Pricing Practices Hurting Your Profits?

Author: Valerie Dennis

On Friday, I was with two colleagues and our conversation turned to a small business that is developing their pricing methodology, after the fact. They think they are leaving money on the table. They probably are. This isn’t a blog on how to set your price; it’s about ancillary factors that affect profit. If you ignore things such as pricing analysis, pricing practices vs. policy and guidelines, you’re probably leaving money on the table. 

Surprisingly, the cost component is sometimes oversimplified, which negatively affects your profits. Pricing models are dynamic; they should be reviewed on a regular basis to make sure they represent the current cost of doing business. When was the last time your labor costs went up, the price of gas, rentals, leases, insurance, facility and equipment costs, fleet expenses, miscellaneous expenses, etc? And when was the last time you adjusted your pricing to reflect those changes?

Take a surgical look at your contracts; this is another area where profit escapes. It’s not unusual for grandfathered contracts to freeze pricing levels—for years. Same goes for evergreen contracts, they get lost in old files, along with outdated pricing terms. Customers generally accept pricing changes when they are justifiable and anticipated. If you have multi-year contracts, specify the frequency and amount of your price increases so your customer can budget and plan for it.

Charge customers for the services or products you provide. Pretty simple, huh? Well, think about the ancillary services that you provide—the ones you don’t charge for. You may find a viable income stream here—for now, it is an expense straight off your bottom line. There’s adding value and then there’s giving your services away for free—which are you doing?

Market equity should be considered. Not all customers are alike; they don’t spend alike and it is unlikely that they cost the same to serve. The challenge is that without guidelines and analysis, you can have two customers with the same spending levels who have markedly different discounts or pricing. You can have one customer with higher spending levels, only to find that the lower revenue customer has the better deal. Try explaining that to a strategic or high-revenue account.

A comprehensive pricing analysis will help you determine pricing guidelines, and anything that doesn’t fit into the guidelines will be the exception. Just make sure you have rules around the exceptions…I have seen some great sales people justify a better discount for a client that belongs on a standard program.

In some companies, practice overtakes policy or policy is non-existent. Your systems and processes may give unintended access. Pricing changes are made over the phone by calling Customer Service or through direct computer access. Every sales person wants to close the sale and they want to do what is best for their client. But not all of them understand the impact of pricing decisions to the bottom line—or they do, and they don’t care. Too much authority without the associated accountability and visibility will lead to pricing decisions that can make a profitable customer unprofitable. Create and communicate policy to all affected departments and employees.

Rest assured, if you lack the right policies, guidelines, analyses, and accountability to support pricing initiatives, you invite risk to your profits. The risk is you’re either overpriced for your market and don’t know it, or you’re enabling every sale to close on price alone—not your value.  Your customers will love you and so will your competitors (if you’re over priced)–your shareholders or partners, not so much…

 

Technorati Tags: Pricing,Profit,Business,Sales,Contracts

Learning Is Not Compulsory…Neither Is Survival

Author:  Valerie Dennis

Learning is not compulsory…neither is survival.   W. Edwards Deming

Every once in a while, if you are open to it, life unexpectedly presents you with opportunities and individuals. I have been blessed with both. Like many, I was laid off and my path for entrepreneurism was hindered last year when my partner backed out, a change in priorities. In reality, it led me to the right path. While in this transition, PeakVizn was formed. What I like about this group, among other things, is the synergy and their capacity for continued learning.

Learning? Who has the time? The challenge for most people is that we know the business world is changing, and it moves at a much faster pace than ever before. This creates new opportunities and challenges.  Mainstream media is often a secondary source for news. Consumer opinion is no longer filtered. If you are participating in social media, the “noise” is enough to make you logoff. How do you keep up?

PeakVizn is a small group of sales and marketing professionals, all of whom I met through networking. As luck would have it, we represent a complement of disciplines, we like each other, respect each other and we share common goals. One of our goals was to learn social media and determine how it will facilitate the job search and our respective jobs.  I benefit from the experience, and learning of others in our group. To put it in sales terms, it saves me time and enhances my knowledge and skills.

You can argue the point that you don’t have time to establish your own PeakVizn, or you can argue the point that you don’t have time for external meetings. I would argue the point that without growth in our respective disciplines, our survival rate diminishes.

Find local networking groups who can provide the relevant training and education. If you went to two events per month—with relevant topics on the agenda—you would likely get what you need. To quantify that, you’ll likely sacrifice 4 hours of work or personal time in a month (allowing for registration, networking and the presentation).

You may also find support in your existing network. Take time to talk to your friends, find the resources they use, share best practices. This doesn’t have to be a formal discussion, it may happen while you’re driving home from work.  Such discussions may trigger additional research and learning but the initial conversation will have been specific and relevant to you.

Bring your learning to work. When I hold team conference calls or meetings, I like to include training, and discussion on work challenges and best practices. You can use this as a forum for applied learning.

Find trusted online communities to assist you. PeakVizn is geared towards helping businesses with real life challenges. Our Mission is to create a learning forum by sharing ideas, asking questions, thinking outside the box, and building collaboration in a community of sales and marketing professionals. And yes, we may one day evolve into something more.

The bold reminder for all of us is that learning is more important than ever. The reality is that we have a lot of competing priorities. The great thing about human nature is that we have a natural instinct towards inquiry and personal growth, and you’ll be energized by what you find—and that energy will take you where you need to be.