As I speak to more customers and prospects it amazes me how many substantial organisations still do not have access to the basic marketing and sales metrics they need to effectively run the revenue generation side of the business. By basic metrics, I mean KPI’s like
- How many leads are generated?
- Where are the leads coming from?
- How many turn into opportunities or actual sales?
- What is the sales pipeline for the next x months?
- What deals are closing this month?
- Which deals are not moving through the pipeline?
- What is the customer problem that we solve for each of our deals?
Although the most effective organisations are adopting ‘Sales 2.0′ approaches to improving sales effectiveness, it seems the vast majority are still using spreadsheets to give them some idea of the sales forecast and don’t have a sense of the basic mathematics that define their sales funnel.
Anneke Seley, author of Sales 2.0, recently posted a summary of a presentation at Dreamforce on how Salesforce.com uses their own products to manage their sales team. She makes a great comment about why a lot of organisation don’t get the most out of their CRM applications:
“Most companies don’t have a clearly defined sales strategy and process that helps their sales reps sell and their customers buy. They don’t focus on designing business processes before rolling out new technology.”
At my company, in the CLOUD, we strongly agree with this sentiment. Getting your processes right and strong executive management support are critical success factors. Without them, the technology isn’t going to improve anything. In our implementation work, we spend a lot of our time up-front, doing a deep-dive into your business process (whether sales, service or marketing) to identify what can be improved and to ensure that the application supports that process effectively.
I have been working with the team at LoyaltyTech, a company that delivers business and technology solutions in the demand chain – e-commerce, loyalty programs, customer analytics, and social network integration – paticularly in multi-channel retail environments. Australian retailers have lagged behind North America and Europe in their adoption of these strategies. DTDigital recently posted on how important it is for Australian companies to pick the pace and predicts that this will be the year it happens.
In recent visits with customers and prospects, I’ve found that many of them don’t have an appreciation of how cost-effectively some of these initiatives can be implemented to provide a measurable increase in revenue and lifetime value of customers. Improving your customer’s experience doesn’t have to cost $1m and can provide multiple opportunities for increased loyalty and cross/up sell. Contact LoyaltyTech to learn more.
I just posted a note the other day looking for information about how people were using social media in relation to CRM – it didn’t take long before I saw this post on Anneke Seley’s Sales 2.0 blog: Social Networking in Sales. It has some great concrete examples of sales teams using LinkedIn and Twitter with measurable results.
At dSales we have been looking a lot at web chat technologies and their application as another sales and service channel – LivePerson is a particularly successful provider that we have been working with especially because of their integration with salesforce.com. It seems that this chat has not really caught in in Australia like in many other countries and I’m trying to figure out why – it can provide significant uplift in sales conversions and increase in service agent productivity.
Anyone got any thoughts?
I wasn’t sure what the definition on Sales 2.0 was, so I looked it up in Anneke Seley and Brent Holloway’s new book Sales 2.0:
“Sales 2.0 is the use of innovative sales practices, focused on creating value for both buyer and seller and enabled by Web 2.0 and next-generation technology. Sales 2.0 practices combine the science of process-driven operations with the art of collaborative relationships, using the most profitable and most expedient sales resources required to meet customers’ needs. This approach produces superior, predictable, repeatable business results, including increased revenue, decreased sales costs, and sustained competitive advantage.”
It’s a fantastic book for any business interested in improving sales enhanced by technology. You can buy it straight from Amazon below:
I’ve recently started working with dSales, a consulting practice specialising in leading edge processes, technology and skills development to increase sales conversion rates, improve resource productivity, and enhance the customer experience across distributed sales and service teams. We often enable this processes with technology based on salesforce.com.
I’ve been getting up to date on the latest research and information on sales effectiveness in organisations and the stats are remarkable. A recent study by Ernst & Young of medium size businesses ($25m-$1b) in the U.S. and Australia indicated that 72% said their 6 month revenue forecast was out by more than 30%, and that another 14% didn’t even know how reliable their forecast was. 78% said they had no or only rudimentary sales processes, and in many cases those processes are developed in isolation from understanding the typical buyer’s .
I’m a strong believer in CRM applications and their ability to help manage leads and opportunity pipelines (as well as the whole customer lifecycle), but the reality is that a whole lot of organisations could benefit from some basic work around optimising revenue generation and developing their sales process before trying to whack in a CRM system. Simple questions like:
- What problems does your product or service solve for a potential customer?
- What is the profile of those types of customers?
- What are your conversion rates at each stage in the sales cycle?
- Based on conversion rates, how many leads need to enter the top of your sales funnel to hit your revenue targets?
- How are leads nutured so that when a sales rep calls on them, the prospect is receptive? (Or, how do you help them become aware that they have a problem that you can solve?)
are only the tip of the iceberg in improving your organisation’s sales effectiveness. The stats also show that organisations that have done the work, with mature sales processes average more than 4x better conversion ratios than those that haven’t. At any gross margin, there is huge potential for massive profit improvement, even in ‘hard times.’