5 essential factors to build a B2B sales pipeline that delivers consistent revenue.

Mar 9, 2020 | Customers, Sales

 

Selling B2B  is a complex activity. Success takes time, effort, and persistence.

Therefore, to be truly productive, it requires the discipline of a repeatable process that is also measurable and scalable.

In order to achieve this outcome, there are 5 factors you should be building into your planning cycles.

Have a very clear view of your target customer profiles.

You cannot be all things to all people, you have to tailor the value proposition you communicate to the problems and aspirations of the target you are approaching. Many businesses have a number of key targets, keeping them clearly separate, with separate value propositions is essential.

For example, one of my clients is a printer, not a large business, but one that has a very wide range of services available internally, from original artwork, to various forms of printing, die cutting, assembly and decoration. They have two primary verticals they target .

  • The first is businesses involved in trade shows. Typically, those businesses leave their printing and stand design needs to the last, and that can cost a lot of money, leads to conflict and suboptimal outcomes. Given they have everything required under the one roof, the time from briefing to delivery is way shorter and usually cheaper than the business managing the various facets themselves.
  • The second is small and medium sized clubs, those with limited internal marketing and design resources, but a need for a lot of work done to a consistent theme. Again, keeping the work in house ensures a quality outcome at a competitive price.

Demonstrate your expertise.

There are as many ways to do this as there are stars in the sky, pick a few that are particularly relevant to your customers, and focus on them. Almost inevitably the best way is to give away information, in such a way that the receiver recognises that the information you have given is valuable, and if it is for free, how much more is there to be gained by working with you?. This might be in the form of blog posts, webinars, conference presentations, and many others, The best however, is having your current customers refer business to you, either directly, or via testimonials in one form or another. People trust other people, they will discount your own claims, simply because they recognise the self-interest.

Observe the 3 second rule.

Every sales call, conversation, post on your website, whatever the material, the most important part of it is the headline. If you cannot grab the attention of the audience with your headline, draw them into the body of the material so they can become more engaged in some way, they will be gone. You have 3 seconds of their attention, after which you have to earn every further second. This is particularly true in a sales phone call, that most dreaded of mediums. Be direct, and specific. ‘Hi, this is (your name) from (company name) we are expert at helping companies like yours with (target pain point) by (specific promise), and would like to take no more than 10 minutes to see how we might be able to assist you’. There are many variations to this, but simple, to the point, and outcome specific works, while making it as hard as possible to say ‘no’ to the next step in the process, which is often a meeting.

Remove the risk.

For a potential customer, doing business with you the first time has some risk. Irrespective of your pitch, the social proof you may have, and the relationship you might have built during the sales process, the decision to go with you rather than the alternative will be seen as having some element of risk. When you remove the risk, put them in a place where they have nothing to lose, why would they  not go with you? Most businesses have some sort of after sales service, replacement, or quality guarantee in place. When a customer is dissatisfied, there is some mechanism to address the problem, so why not make it explicit, a part of your offer, remove the risk. The potential cost is already factored into your price, it is just that you hope nobody uses it because you always have satisfied customers. Remove the risk from making the choice to go with you, and your sales will zoom! 

It is easier to get more from a current customer  than it is to find a new one.

How often we forget this, and devote resources too hunting out new customers, when there is potentially more business for you in the current client roster, their associated companies, and perhaps those to whom your current clients are happy to offer referrals. This requires that you build relationships over time, and those relationships are based on trust, mutual benefit, and importantly, your performance over time. My favourite measure of sales effectiveness is ‘share of wallet‘. It is a demanding measure, it forces you to develop intimacy with your customers business,  as well as understanding your own capabilities very well, so you can determine what is inside the wallet, and what is outside, and therefore not productive to chase. 

Call me when the experience I have can help address these challenges.

 

 

 

The grassroots essentials of marketing

Feb 19, 2020 | Branding, Customers, Marketing

 

What do we mean by the term ‘marketing’?

I suspect if I did a poll, there would be a scarily wide range of responses. So, let me repeat the definition I have evolved over 45 years, which would not be found in any textbook.

‘Marketing is the identification, development, protection and leveraging of competitive advantage that adds value’

This is different from the ‘purpose’ of marketing, which to my mind is to create the opportunity and motivation that, when conditions are right, will build relationships and create opportunities, that lead to transactions. That transaction might be a sale, a subscription, a vote, a referral; it can be many things, with the common element that it is an outcome of the so called marketing activity.

Let me use the metaphor of the expert gardener. 

This gardener has a process by which he/she manages their gardens.

  • They decide what it is they want, what the end product should look like, at least in general terms.
  • They pick the ground they will cultivate.
  • They prepare the ground in the manner appropriate for the outcome they have visualised.
  • When conditions are right, they plant the seeds.
  • They nurture the seeds and resultant seedlings until they are ready to harvest.
  • They repeat the process, incorporating the things they learnt on the way through.

This process is the same for growing broadacre grain as it is for growing a few decorative flowers in the back yard. As it is for marketing. The process is the same whether the product is a tub of yoghurt or a power station, a national effort, or a local one. Only the scale of the investment, implementation details, and time frame differ. Try to take a shortcut, and you end up with dead flowers, or at best, substandard ones.

So how does that rather vague stuff translate into your world of marketing the products and services of your SME?

When I first encountered ‘Marketing’ at University, 50 years ago, the core of it was ‘The 4 P’s of marketing’. Product, Price, Place, Promotion. Everything sprang from those 4 elements. A lot of water has passed under the bridge since then, and the expressions used may have changed a bit,  the processes of achieving them changed radically, but the core remains.

The architecture of the 4 p’s of marketing are a bit like the Model T Ford. It redefined the notion of the car, and how to manufacture it. Over time, the expression of the car has changed enormously, but the basic architecture remains.    

However, to me it makes sense to see ‘marketing’ from the perspective of the customer, and to do so, we need to answer a few simple questions:

  • What is the problem my customer has that I can solve with my product/service? This will answer the further question of why should my customer do business with me and not my opposition, which is all about the value you can create while being differentiated from the competition. You need to define it from the perspective of the customer. The costs, of all types, created by the problem, and the benefit to them of a solution.
  • Who is my ideal customer? Your ideal customer will see your differentiated value proposition, as being made for them. This takes focus and always hard choices about who you will service, and who you will not; it is the customer Pareto at work. If you have defined both the problem and the ideal customer, i.e. the one who has more of the problem, or feels it more acutely than most, when they see your value proposition, their instinctive response is ‘at last, this is for me’, or something similar.
  • How do I apply leverage to my marketing investment? It is at this point you are considering which messages, delivered to who, via what media, and how do you do that while getting the biggest bang for your buck possible. It is where the marketing rubber hits the road.
  • How do I make a profit? Profit is a simple equation: revenue minus cost.

Still the same four items, or ‘P’s, it is only the articulation and perspective that has changed. The primacy of the ‘p’s remains.

The common denominators in each of the four, required for success, are choice and iteration. You must make often very difficult choices, implement, learn from that experience, and apply the learning for the next iteration. This need to make choices, and enable the manner in which you deploy your modest marketing resources to evolve based on the experience, is perhaps the largest marketing hurdle for every SME I have ever seen. Many SME owners have had a bad experience with marketing snake oil, and are reluctant to try again, and others who have hit on something that seems to work are reluctant to change anything, so you get a lack of optimisation, not as much leverage as you could.  

As you consider your marketing, given the small scale of business, and budgets available, do not let your thinking be dominated by the mass models of the past. These are simply not appropriate for you. Way more appropriate are small, niche models, an artisanal approach. Why? We have become sceptical, untrusting, demand to know the real provenance, and only rely on those we know personally, and trust because they have earned that trust.

The original social media, word of mouth, subsumed by digital for the past 15 years is making itself heard again. Therefore it follows that you, the business owner, need to be seen and heard, tell your story, use the digital tools, but be personal and human. However, this does not mean you should turn your back on digital, by any means. The data and tools we have now could not have even been imagined 15 years ago, let alone 50 years ago. The practise of marketing has changed radically, the foundations remain the same, just way more exposed and subject to interrogation and automation than they were, and you have to be in there just to keep up.

As Einstein said, ‘Everything should be as simple as possible, no simpler’. What could be simpler than providing a great product and service that solves a problem, and having those problem liberated people tell their friends, and most particularly those with a similar problem? That is how to market at the grass roots.

 

 

 

How do retailers create irresistible ‘customer flypaper’?

Jan 28, 2020 | Customers, Marketing, Small business

 

As a very young kid, I remember my grandmother having flypaper stuck around her kitchen. From time to time she would smear something smelly on it, which doomed any flies in the neighbourhood.

Wouldn’t it be nice to have ‘Customer flypaper’ for your business?

Once attracted,  they will never leave, simply because they never want to.

A secondary but ideal characteristic of that customer flypaper would be that those customers who were just there tyre-kicking, shopping for the cheapest price, or were inclined to just waste the time of you and your staff, would be repelled.

Nice. I have seen such a metaphorical commercial flypaper at work.

My aging mother lives in a major regional centre, and has a range of pharmaceutical and ancillary needs. A local pharmacy has created a veritable moat of flypaper around his ever increasing customer base, my mother amongst them.

How has he done this?

  • Focus. He focusses his attention on his current customers, personalising their experiences and interactions with the pharmacy and its staff. This is done by a combination of digital record keeping software, and old fashioned humanity. If you want loyalty from your customers, you have to earn it, as it is rarely just given, and then never lightly.
  • Differentiation. Finding something that is challenging to replicate, and adds value to a cohort of customers creates a powerful attraction. In this case, the pharmacist is a compounding chemist, so is able to combine and mix the medications in such a manner, that instead of taking a pile of pills twice a day, my mother is able to take just one or two.
  • Rewards. Current customers are rewarded, not by money, discounts, or any of the other easy to replicate offers, he recognises and rewards their psychology, their instinctive need to be a part of some sort of community. In the early 50’s, psychologist F. Skinner did a series of experiments, using rats and pigeons as subjects, since validated widely in labs, and obvious any time you walk into a location with poker machines. The psychological power of an intermittent reward can be compelling, for some, irresistible. This pharmacist uses intermittent rewards that confirm he cares about his customers. A vase of flowers sent when one is in hospital, a handwritten birthday card, remembering a grandchild’s success at school, all sorts of things that just demonstrate he, and his staff, care.
  • Service. Older people sometimes find it hard to get out and go to the pharmacy. So, there is a free delivery service, for your compounded few pills, all sorted into the times you must take them, packed in a daily and, morning/afternoon blister pack that even someone with advanced arthritis can open. This is all run on an account, so not only can you get the pills delivered, you can also ring up and get other items stocked delivered at the same time, paid for in one simple monthly transaction. Being cynical, I compared the prices of a number of the ‘grocery’  items my mother had bought in this manner to other retailers. While it was not the discount promotional price sometimes available in woolies, they were by no means capitalising on an opportunity to gouge.
  • Overheads. This pharmacy is located in a suburban shop, next door to a butcher, baker, and physiotherapist, with generous and easy parking outside the door. Not only is this convenient, it would be a cheaper place to have a store than in a location with heavy passing foot traffic, and leaves a bit more in the kitty for doing the things that really matter to customers.
  • Collaboration. There is considerable collaboration between the co-located shops. The pharmacist also collaborates closely with a number of the local GP’s and specialists to ensure that their patients receive the best possible care, and medications. Mums GP from time to time, varies the dosage of some of the things she takes, and communicates that change directly to the pharmacist. This ensures that the information is clearly communicated and understood, and adding a layer of added professional scrutiny to the mix of medications she takes.
  • The ‘original’ social media. Word of mouth is the original social media, and still by a country mile, the best. My sister who lives in the town, and helps Mum, often picks up bits and pieces in the pharmacy for herself, as well as Mum. The level of service and care evident, and the simple fact that the staff also know her, and her family, means not only would she not go anywhere else, but she will not allow any of her friends or acquaintances to go anywhere else.

All this adds up to very powerful ‘commercial flypaper’.

It is not easy to build, takes time, effort, and investment ,as well as a very clear strategy within which to build the tactics that act as the flypaper.

 

 

 

The new Revenue Generation paradigm

Nov 25, 2019 | Customers, Marketing

When was the last time you made a sale without the customer first doing a google search on their problem, and alternative solutions, before you knew they existed?

A while ago I bet!

Customers no longer need you, the information you have, and  the products you sell, simply because they can easily find many alternatives.

The traditional sales funnel, starting with awareness, moving through familiarity, to intent and action, is dead. The model of a marketing function producing ideas and collateral, which is thrown over the organisational silo wall to sales to use for everything from the cold call to take the order is also dead.

In its place is a flywheel with has customers at its centre.

This simply means you have to know your customers intimately, not just their demographics, their circumstances and behavioural patterns. This in turn implies a great deal of work has been done in defining who is your ideal customer, and being able to reach out to them at a time when they are in ‘buying mode’, with a solution to the problem they are facing, that you can solve better, in some way, than anyone else.

There are no magic bullets to any of this, it takes hard work, experimentation, and persistence, and most importantly, the assistance of those customers you do know well,  to tell you what you need to do to keep them. When you enhance your levels of service, then they will be your sales force, spreading the word, one by one.

The Buyers journey is also an old fashioned cliché, usually represented by a linear process. These days it is no such thing, it is more a series of many interdependent decision points, whose order is often  changed as your ideal customer drops in an out of a decision cycle that is independent of you, the seller.  

No longer should you see Sales and Marketing as separate functions, one feeding the other. Both are part of a highly variable non-linear Revenue Generation process over which you may have some influence, but no control.

The day of the functional silo being efficient is over, thrown out the window by the power of the buyer!

 

 

 

 

 

5 meanings of ‘Send me a proposal’

Oct 21, 2019 | Customers, Management

 

Send me a proposal is a phrase I hear from time to time, and most of my clients hear often.

The challenge is to interpret what it really means.

Possible meaning 1. You have their attention, your pitch has generated genuine interest, and it is likely that there will be a job here, assuming the demons of the procurement process, and that person in the background with the power of veto, is amenable. Great.

Possible meaning 2. There is a job here, but you are not going to get it. Our procurement process requires us to have three quotes, and yours is number three. We can now confirm our first choice has the job.

Possible meaning 3. Great meeting you, thanks for the time and information. Your offer is really interesting, and I would like to go ahead, but cannot. However, I really like you, and would not want you to feel as if you have wasted your time, so send me a proposal.

Possible meaning 4. We think we have a problem, but are not sure, and even if we have, are not sure if it is worth addressing. Therefore, have a think about it, do some preliminary research, and give us your views, we will be grateful, we will both know  a bit more.

Possible meaning 5. I am just making myself feel important by asking for a proposal, but do not have the authority or budget to commission such a crazy project.

Clearly there are many variations, but they seem to boil down to these five.

I recently made the mistake of preparing a proposal for an industry body, knowing at the back of my mind that it was a waste of time, but the exercise of gathering the information to prepare it was useful for other reasons, so I proceeded. As anticipated, there have been a number of requests to amend the proposal, which has been done, but I do  not anticipate a green light any time soon.

As consultants, and service providers, we can spend a lot of time preparing proposals that will never go anywhere, and the time we spend is not valued by those who are asking us to do the preparation. It is up to us to leverage the opportunities as we best we can.

There are several strategies you may want to think about, all require you to have some sort of

‘RFQ Qualification’ process in place.

  • Politely decline the opportunity. It seems that sometimes when you do this, it just confirms in the mind of the potential client that you are in fact the right person for the job. You can then go around again if you choose to.
  • Reframe the RFQ so that you are responding to the question through a different frame from the one your competitors will use. At least that way, a real choice has to be made, and perhaps some deeper thought put into the brief, and ultimate choice. Sometimes this works.
  • Subcontract the job to someone else, and should they get it, you can clip the ticket.
  • Run for the hills.

In most cases where a proposal that acts as a competitive tender is required, there will already be a preferred tenderer. If you do not know who it is, it is not you!

 

Header cartoon credit: Scott Adams, again nails it.

 

 

 

An alternative view of ‘KPI”

Oct 11, 2019 | Customers, Marketing

 

We all understand the term ‘KPI’, Key Performance Indicator. It is always used as a term to describe internal performance metrics.

Our customers employ us to deliver value, a solution to their problems, a means to deliver some sort of gratification. Yet, we use as performance measures things that are of importance to us, usually irrelevant to customers. Sales revenue, margins, share of wallet, customer churn, inventory turn, factory efficiencies, and so on.

How many of your customers give a toss about your factory efficiencies or sales revenue?   The reason they came to you is that you made them a promise, sometimes unspoken via your brand, sometimes explicit via your advertising.

Perhaps the KPI metric should be reversed to ‘Kept Promise Index’.

The promises we make have no positive weight unless they are kept, then they carry weight. When promises are not kept, they also carry weight, far greater than when they are kept, but it is negative weight.

In my experience, a promise not kept is remembered, commented upon, often generating disproportionate  anger and frustration to be vented somewhere, usually these days on social media.

Last week my internet service went down without notice for 16 hours, as always, right in the middle of a research project. I will remember that, and act on it, whereas for probably 99.9% of the time, the service is there, uninterrupted, at my demand, but that is the promise, so I will not necessarily remember that 99.9%, it is simply expected.

However, when the promise is made explicit, and it comes with a guarantee, it can become a huge marketing benefit. For example, if I was a plumber servicing domestic  markets, I would explicitly make two promises: turn up when promised, and leave the work site cleaner when we leave than it was when we arrived, or there is no charge.

I think there would be a premium price in that, as it is a guarantee of a promise to be kept!

How many of your KPI’s would your customers care about?

 

Header cartoon courtesy Scott Adams and ‘Dilbert’