Recession: Reducing Costs Is Not Enough

Companies have survived recessions in the past, but most of them did not take advantage of such unique opportunity to change the way they managed business – specifically Sales and Marketing.

Sales and Marketing are the most inefficient business processes: less than 1$ in purchase orders out of 10$ in leads. That’s less than 10% efficiency!

Don’t compromise just by reducing operational costs and continue managing the old way. That’s what your competitors are doing too. Take it one step higher…

This crisis is also a timing opportunity to change your sales and marketing management methods from intuition based to a discipline based on structured processes monitored by measurable indicators, far deeper than just trivial quota attainment.

That’s the “Sales Engineering” concept. Leverage on our expertise in Sales Engineering to reduce cost of sales, reduce sales duration and improve your forecasting accuracy.

Visit http://www.abergman.com/ for more details.

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Will Sales People use CRM?

"Too often technology attracts an unbalanced part of our attention."...

"We saw CRM like the ERP system. It was essentially just a case of Going Live effectively, and it would work"...

The CIO selected the best CRM system, but still if your sales people do not use it systematically, it will not generate value.

Nowhere is software adoption more difficult than CRM with salespeople. Wrongly perceived as picking up the best software technology, CRM projects involve embedding structured sales processes and managing cultural changes through training on how sales and marketing can be driven by measurable performance indicators far more powerful than just "quota achievement".

If your "stick" is to have a management tool, provide sales forecast, get a discount authorized faster, only through the CRM system, then—no surprises—the system is not going to get used by the field. If you can show how CRM will drive better leads, higher conversion rate and shorter selling cycles, then your salespeople bonus appetite will drive its adoption. Little attention is given to map your customers buying process and embed sales, marketing and service processes within the organization culture genes. Lots of attention is given to the fields that you expect sales people to (wrongly) fill in for you.

Salespeople fail to adopt CRM because they perceive it as a time consuming data filling technology for management to watch them over their shoulder... Chances are strongly against you seeing a return on your CRM investment if the different benefits each user expects to get - management, field sales an dealers - are not contemplated.That is related to business expertise - certainly not IT technology.

When we start looking at CRM as a business owned project, made of people with dramatic different needs, sales (re)engineering processes requirements and IT — the user adoption issue becomes a lot less difficult. And yes, even sales people will use CRM if they get out of it what they really need - usually quite different things from what you need...

Leverage on our expertise and help avoiding costly failures in your CRM project.

Bad Lead Management

Revenues in today’s uncertain times rely heavily on biting into our competitor’s market share; less on market growth. Getting quality leads is becoming the biggest challenge in actual days.

Marketing Process Map Example

Unfortunately, companies without even a basic a lead management process lack data on leads to orders conversion rates and keep campaigning in ROI darkness.The first critical requirement is a marketing process map derived from the buying processes of our target customers.

Is this happening in your company too?

Analyze the following recent survey results (California, 2008) and compare them to yours:

• 68.8% don’t qualify leads before sending them to their sales teams

• 52.4% have no formal process for compiling sales forecast reports

• 82.8% don’t track ROI for lead generation investments

If this sounds familiar to you too, leverage on CRM technology and sales management expertise. Map, measure, analyze and improve your performance continuously.

Marketing is a structured process transforming our promotional budget into leads. Costs can range from a few dollars per lead up to more than $1,000.

Bearing in mind that only less than 10% of those leads will eventually transform into an order, the marketing ingredient in the cost of an order, varies between $1,000 to $10,000 (!) - a huge source for performance improvements.

Exhibition budgeting in uncertain times

B2B marketers use exhibitions to generate leads more than any other tool. Yet the inability to generate enough leads for the sales force is the biggest problem marketers’ face.


Companies invest large budgets on exhibitions, and yet are rarely satisfied with the results. Why is this? Are they using the wrong tactic or are they simply not doing it correctly?


Marketers spend far more on exhibits than nurturing prospects relationships before the show and once they return to the office after it. As a result, exhibitions ROI often fail.


The single biggest reason for it is that marketers view exhibitions as stand-alone events rather than elements of an integrated marketing process. An exhibition is one of many interactions leads will have with your company prior to making a decision to buy. As such, it must be preceded and followed by other marketing activities including a pre-show traffic-building campaign and a well-organized and executed follow-up plan.

Do you have such exhibitions plans?
What tools do you use?

How do you ensure your exhibitions pays back?

1. Set goals. Achieving a measurable lead generation and maintaining visibility with prospects (set a measurable indicator for it too) are the two most important objectives of an exhibition.


2. Invest in pre-show marketing. Just being on the floor does not ensure a flow of leads to your booth. Conduct a marketing campaign to build attendance for the event.Reaching exhibition participants has become more challenging and web tools have changed the way of doing it. In the past we marketed our exhibitions through e-mail and press releases.

Today, it also makes sense to invite attendees via blogs, social networks and community forums. Messages that reach your prospects through multiple communication channels have a far better chance of being recognized.


3. Quality over quantity. When it comes to lead generation, the quality of the leads is far more important than the number you generate. Qualified prospects are those people who hold the right jobs at the right companies who potentially need your product or service and are able to purchase them. Meeting a handful of these individuals is infinitely more important for your future sales than collecting the names of 100 people who couldn't care less about your product or service.It is critical to have a definition of a sales-ready lead identifying the requirements a prospect must meet before delivering it to a sales rep. This includes the person's title, industry and the size of his company, budget availability, a timeline and an executive sponsor.


4. Sorting and nurturing leads. The first post-show duty of the marketing team should be to process the contacts that were gathered. Only those that are truly sales-ready should be sent to the sales force. Leads not yet ready should be nurtured. Some prospects will want to learn more before agreeing to talk to a salesperson; customer’s case studies, special reports, webinars, tips sheets and an informative, regularly distributed e-mail newsletters and blogs are a good way to do it.

For some longer term prospects, the timing just isn't right. These prospects require a long-term strategy of staying in touch to ensure they remember you if and when the need for your type of solution pops up. Regularly distributed, email newsletters and blogs are a good way to do this.


Probably you will be participating in at least one exhibition this year. By following our advice you will ensure the experience isn't a waste of resources, but rather, a lead generation engine.

Cost per lead is irrelevant...

Do you establish a marketing budget for the year and increase it or decrease it the next year based on the performance of the business?

While spending tens of thousands of dollars on trade shows, workshops and marketing campaigns, companies almost never close the loop to determine the effectiveness of marketing outreach efforts.
They have no information regarding how many leads the program provided, how many of those leads turned into customers, and how much revenue was generated from that customer that they may have closed. As such, ROI from costly and significant marketing expenditures cannot be determined.

The truth is that sales people care very little about the cost of the leads marketing generates. What they really care about is how many of those leads will actually become viable sales opportunities. Cost-per-lead measurements are irrelevant unless we can answer another fundamental question first, “What is our rate of lead acceptance into the sales pipeline” and then “What is the cost per opportunity?”

Sadly, a lot of marketers tend focus on cost-per-lead because they really don’t know what happens to their leads after they hand them off to their sales teamWhile a strong vice-president, Marketing Director, or CEO should be paying close attention to these data, without a CRM (customer relationship management) solution and the appropriate reporting it becomes an impossible task. The result: instead of using vital and often limited funds to drive additional business from profitable marketing programs, companies just continue with business as usual repeating the same programs without measurement of success.

B2B Marketers must start measuring cost-per-opportunity now! It’s the one metric that can help you understand how well your sales team accepts and pursues leads. Ultimately, it shows if your leads are actually helping your sales team sell and if we’re positively contributing to their pipeline.

A CRM solution can help address such issues by deploying a structure that allows control. Ultimately such functions ensure that these corporate practices are part of a better sales and marketing behavior.

More on SALES PROCESS ENGINEERING & CRM ...

Does ERP apply to Sales?

ERP (Enterprise Resource Planning) software helps closing the loop between the shop floor processes to business planning by measuring the manufacturing stages from raw material, work in process, finished goods, payment collection and service.

Does the logic of ERP apply to sales too?
From an IT perspective CRM is to sales what ERP is to production.
Unfortunately this concept usually crashes, due to the traditional perception of sales belonging to a world of reaction rather than process oriented.
CRM software implementation may be a short term success but its long term adoption fail every day due to the above "software" approach.

The driving forces of CRM adoption:

1. Sales, not IT- must own the CRM.


2. Buying Process is first, only then Selling Process: know your customers buying processes - structuring the selling and marketing processes of your organization are just an outcome of it.


3. What gets measured is what gets done: define your KPI (Key Performance Indicators) in a simple and clear way. Do not add any new graph to your CRM dashboard unless everybody knows how to take correcting actions if it turns red. F2F (face to face) time with customers is your most valuable sellings asset. Reduce the reporting time (excels, powerpoint etc)spent by your salesforce. Management reports are dead: pipeline status, forecasts and won/lost assessments - among other KPIs - should be visualized on your CRM real time dashboards.


4. Invest in your dashboard analytics - not in gathering its data (a CRM technical functionality). Automate your workflows, such as price discounts authorization, forecasting overriding, red flags emails, commissions and entertainment expenses. Flow them streamily through your organization (a CRM technical functionality too).


5. Knowledge Center - a vital part of your CRM: "give me the information I need - now!". This applies both ways: salesforce to management and vice versa. We live in a Google era...where information is an on demand commodity, chasing data is wasting resources. Clear the knowledge traffic bottlenecks across your organization, as well as between your selling partners and your organization. An open knowledge flow between the main office and the sales channels - and between themselves - enriches the corporate selling IQ.


6. Leads generation is not the exclusive responsibility of the field salesforce anymore. Use automatic marketing tools like regular emailing, webinars, webadvertising, websurveying – just to mention a few.


7. "What's in it for me?". Adopting CRM by the salesforce - direct and indirect - is your ultimate concern regarding the success of a CRM project. Sales people are individualist, optimistic and self driven personalities. Educating them on the sales processes engineering and CRM advantages is an ongoing cultural change - certainly not a singular CRM technical training. If the sales person - direct or indirect - is not clear why adopting the selling process concepts managed by a CRM tool allows him selling more and getting higher commissions - CRM is at risk of failing.

ERP and CRM are both software but still two different animals - do not confuse them.
Think again of the 3 CRM ingredients: process, culture and people – to successfully gain an additional advantage in our daily differentiating race.

"Do what you do best and outsource all the rest"
Benefit by evolving sales management from an "art" to a discipline in your organization.
Call me at (Israel) 09-9502066.

CRM - a corporate or territorial responsibility?

Customers buying processes are culture intensive differing from country to country. The same product is bought differently in the US than in Japan.Selling processes vary by type of channel.

Distributors will leverage on a wider variety of offerings, while direct sales force will focus on a deeper product knowledge. Therefore, the selling, marketing and service processes, must be designed at corporate hierarchy level, rather than at a singular territorial altitude, independently of its market size.

Forecasting, price discounts authorization and other workflows, should follow the same guidelines - their planning is a corporate responsibility, not a territorial job.KPI (Key Performance Indicators) may vary by territory: managing price discounts can be more critical in China, less decisive in Japan.

Monitoring gross margins during the selling processes of an opportunity may become vital in Shanghai, less in Tokyo. KPIs should be designed and managed at corporate level rather than at territorial rank.

Adopting CRM implicates changes in the management culture, as it drives sales from an "art" to a discipline. Overcoming obstacles to change is a territorial responsibility and should be delegated to the regional managers.

SUMMARY

• Processes, KPIs and CRM architecture - must see global differences and need to be designed at a corporate level.

• CRM adoption has to overcome local obstacles to change, and need to be a territorial owned task.