Here's an interesting question to consider: "Where does the B2B sales model go from here?"

And, whilst I wonder whether the sales model example quoted in the article is really so different from other technology companies who sell through channel, it's still a good question to ask.

Without doubt, the traditional "sales force" has changed over the last 10 years.

The other day I dusted off an old classic book on the sales force written back in 2001 and was amazed how out of date it was.

No mention of e-commerce, inside sales, web-demos or conference calls.

No search. No social media.

It seemed as far removed from today as when I was a young gun laughing at the old sales pros  talking about the 2p's they kept in their Ford Granada's so they could call the office from a phone box once a day.

But, back to the question: "Where do we go from here".

For companies that are looking to increase revenue growth it's always useful to break down their business model and understand where is can be improved.

If you have a traditional B2B "direct" sales model, you can look at different channels, such as e-commerce or inside sales to improve efficiency. Pushing repeat orders through these channels enables you to reduce expensive field sales resource.

In addition, re-thinking the sales process can reduce costs through using technology to increase the effectiveness of your sales team which, in turn, increases profitability.

As the article points out, you can also consider developing indirect channels to drive revenue.

Selling through partners, distributors and resellers are options that may be better suited to some of your products and services than others.

Sometimes it takes a new product/service proposition to open up revenue opportunities through different channels. An example would be a training provider that has a direct B2B sales model for it's in-house courses but now delivers e-learning solutions. The lower price point of e-learning may require a change in the sales model and could be more suited to an indirect sales channel.

The theme here is "change".

As the article points out, "the percentage of reps making quota has been stuck in the fifties (percentile range) for years" and the average Sales Director tenure is "as low as 19 months".

Either it's the people that are no good or something else needs to change to hit the numbers.

Sure, it could be a skills development issue. Or maybe improving the sales process. Or maybe the market's moved on and you're still trying the sell the way you always did.

Ah, wouldn't it be great if the worst problem you had in sales was where to find a phone box?

Labels: b2b sales, inside sales, revenue improvement

I was reading an interesting survey "B2B Marketing Budgets, Strategies, Tactics and Trends" (download a copy here) which looks at the changes in the marketing mix for companies.

The survey looks at tactics for both lead generation and brand awareness for B2B companies.

From a lead generation perspective, the top tactics in terms of effectiveness are:

1) Inside sales and telemarketing are considered the most effective tactic for lead generation (47.6% rated them "highly effective")

2) Trade shows and conferences are the next most effective (moving up to 2nd place from 3rd in the previous year's survey)

3) Executive breakfasts and events fell from 1st place to 3rd place in the survey.

Another thing that stood out to me is that marketers from large companies consistently rated inside sales and telemarketing as highly effective in generating leads whilst smaller companies are more likely to use lower-cost digital tactics for lead generation (search marketing, websites, podcasts) even though "these tactics are not among those they rate most effective"

Is it me or does that not make any sense?

Why use less effective tactics if they don't work as well?

Well, the more you dig into the report you realise that it's mainly an issue of budgets being squeezed and marketers trying to get more from less.

And, on top of that, it's these low-cost digital channels that are seeing the greatest increase in spend.

According to the report, the most widely used digital tactics are company websites (95.4%, which makes me wonder who are the 4.6% of B2B companies that don't have a website) and email marketing (87.7%).

Social networks and blogging continue to see increases in budget spend but also continue to rank lowly in terms of effectiveness for lead generation (they rank higher for "brand awareness")

So, how do you square those stats?

People are spending more money on marketing tactics that are less effective for lead generation compared with proven tactics that consistently deliver?

Has everyone just lost all business sense or is there a different story under the headline figures.

Crucially, it comes down to budget.

Some of the most effective marketing tactics require a larger investment. Trade shows are not cheap. Running a high-touch telemarketing campaign over several months also requires considerable investment.

Sending out 1000 emails however is very low cost. Whether it delivers the number and quality of leads needed to keep your pipeline full is a different story.

Looking at budget size the survey shows that smaller companies have smaller budgets (duh?) and that companies that only sell B2B with a direct sales model (ie: their own salespeople rather than through resellers and channel partners) have the smallest budgets of all.

Even more of a reason not to waste money on in-effective tactics, I say.

Which is why we always work with clients on fee models that are part fixed and part paid on delivering results. For our fixed fees we do things including telemarketing, email marketing, event/trade-show support, etc (basically stuff that we know "works") and then we link the balance of our fees to results, such as a % of revenue generated.

It's a model that works for our clients and, we believe, ensures that we don't waste our time (or your money) doing stuff that isn't linked to tangible revenue growth.

Labels: b2b email marketing, b2b lead generation, b2b marketing, b2b telemarketing, inside sales, sales lead generation

It seems to me that there's a trend in articles which start with suggesting the old order is dead.

I've seen all the "Is cold-calling dead?" and "Is direct marketing dead?" ones over the last few years as everyone promoting online and social media marketing will tell you that the old nasty world of push marketing has been replaced by a new cosy opt-in world chocked full of engaging content and social interaction.

(In fact, the "cold-calling is dead" one has been doing the rounds for as long as I can remember, the first time I saw it it was pushing face-to-face networking as the solution to all your problems.)

Anyway, let's leave that argument on one side and look at a new variation on the theme, "Salesmen are Dying and Other IT Trends".

The article is focused primarily on IT B2B buyers so it doesn't necessarily equate to all sales and, in particular, service based propositions. But the fundamentals are that Internet-enabled buyers only engage with a vendor's salespeople towards the end of the process, which means that salespeople have less time to build relationships and influence decisions.

In B2B sales, the buying/sales process is more complex that B2C transactions. B2B sales is driven by multiple stakeholders and decision makers, and carries more risk. Also, with more complex/technical solutions there's a greater reliance on vendors to help with scoping the solution.

So, are sales people dying?

Certainly, the more commoditised the product the more it will move towards online transactions.

I was chatting with a client the other day who used to work for the UK's largest distributor of safety products. 10 years ago they used to have a huge branch network and hundreds of reps on the road. Now it's nearly all telesales and online ordering.

Maybe another 5 years and the telesales will be a fraction of what it is now and most will be online.

Also, the shift towards buyers researching online means that there's a reduced need for sales to engage early in the sales cycle. When I ran a field sales team we'd get the leads from head office (usually a response card from a magazine or lead from a trade show) and the local rep would make an appointment to sit down, provide the prospect with brochures, etc and qualify the lead.

Now buyers can get the information they want before they have to engage with sales. Which means less sales people are needed.

Less head count for sales means that each sales person is focused on deals that are more advanced in the buyer/sales process. Being more efficient and effective with limited resource is the name of the game, hence the rise in sales support teams, web-demos, etc.

Where is this all going?

To me, the trend in B2B sales is that the classic "sales rep" is heading for extinction. Poorly trained road warriors will be a thing of the past as buyers today don't need to waste their time with them just to find out early stage information.

The lead qualification piece has shifted internally to telesales or inside sales support.

Beyond that, there is a need for B2B sales people who bring real value during the more advance stages of the buying/sales process.

Refining scope, assisting in vendor selection decisions, support prospects with building business cases, and, ultimately, supporting with implementation and hand-over, these are the areas where sales now have to focus.

B2B sales people aren't dying, the smart ones are already adapting.

But, I agree that the dinosaurs will become extinct.

Labels: b2b telesales, inside sales, sales

I came across an interesting piece on Inside Sales from the Bridge Group based in the US.

They've published a "Periodic Table of Inside Sales Metrics", which is an interesting way of presenting many of the metrics they've researched.

The Bridge Group specialises in consulting on Inside Sales for technology vendors and their president, Trish Bertuzzi, is founder and manager of the Inside Sales Experts group on LinkedIn.

Looking at the metrics they present, there are some interesting ones from a telesales perspective (what we would typically refer to "Inside Sales" as in the UK)

Under lead generation, the average quota for appointments per inside sales rep is 16 per month. Also, the average hours per day on the phone for lead generation is 4 hours.

Now, I know from reading other articles published by The Bridge Group that many of the inside sales people surveyed are also responding to and qualifying inbound leads so this doesn't mean that 4 hours a day, 20 days a week generates 16 appointments from outbound cold calling.

To me, that's not a million miles off our experience in lead generation and appointment setting for technology vendors.

We figure that one of our team (focused purely on outbound lead generation) can generate a qualified appointment every 1 to 1.5 days for a technology proposition.

Based on The Bridge Group's figures their on quota average is 1.4 per day but, as I said, that will be a mixture of inbound and outbound lead sources. Which means I think we're broadly on the same page.

Also, I liked the metric that that average ramp-up time for an inside sales rep was 4.5 months.

If only we had that long :-)

Labels: appointment setting, inside sales, sales lead generation, telesales