salespodder: sales blog with musings and tips from inside sales

Renewing Dampened Enthusiasm

salespodder — Thu, 09 Oct 2008 10:21:50 +0000

We’ve all been there. You’ve a new idea that you’re convinced your bosses will love. A new product you know will change your customer’s life. Excitedly, you deliver an impassioned pitch. Their response? Yawns, at best. Demoralisation crushes your pride.

There are countless examples of world-beating pitches falling on a staggering amount of deaf ears. How many record companies turned down the Beatles? Isn’t it the case that JK Rowling got turned down by a dozen publishing houses before going on to sell 325m books over the next decade? I even learned recently that Hewlett-Packard no less, surely famed for innovation and RnD, turned down a design for a personal computer. Not just once, but five times. What happened to the person who’s idea it was? They left to pursue their idea themselves by forming a company called Apple. The rest, as they say….

Next time someone pours cold water on an idea of yours, as well as readying yourself for the long haul, tell them these (of many) wonderful words, courtesy of Albert Einstein:

“If at first, the idea is not absurd, then there is no hope for it”

+15% Credit Crunch Impact

salespodder — Wed, 08 Oct 2008 11:14:00 +0000

Listening to BBC Radio 4 most mornings recently, they’ve an innovative approach to consistent programming. Eight o’clock, Business Editor Robert Peston talks you through constructing your own gallows. Quarter-past eight, a pair of luminaries recommend their take on which rope makes the sturdiest knot and how to tie the most effective noose in it. 8:24, six minutes of adverts for ‘wonderful’ programmes to look forward to elsewhere around the network.

Normally a pretty positive person, this repetition is getting a bit much for me. A former Chief Investment Officer of Baring Asset Management (Michael Hughes) passed on sobering facts. There have been (a remarkable) 42 banking crises since 1970. That’s more than one a year around the globe. The average impact has been to reduce GDP by 13%. He intimates that this one is worse than ‘average’. At any rate, does this mean that if our selling numbers currently add up to 100, then pretty soon they’ll drop to 87? If we’re hitting “8″, then are they destined to fall to “7″?

Of those with the binoculars looking for golden skies, retail giant BHS’s boss, Philip Green, reminds us that (even though his latest profits have dropped) we need a little perspective. Business will not disappear, he reminds us.

So how will this effect the solution selling rep? The low-hanging fruit has clearly all been picked. One mindset is to overshoot last year’s results. If previously you could reach 100, and this year doing the same would lead to 87, then perhaps now, simple maths tells us we must focus on how to sell 115.

Giving Up On CRM Adoption?

salespodder — Tue, 07 Oct 2008 08:11:42 +0000

I read my latest Selling Power newsletter on crm last night. They mentioned a piece of PR they’d received from the boss of a crm vendor. It was satisfying that they disagreed with a third of what he set out in order to raise adoption of crm systems.

Back in the cowboy days of the Nineties, my exasperation with reps not using the software I was repping (and passionate about to the point of possibly being in need of medical attention) prompted my then superior (the Founder) to stun me. Don’t bang your head against a brick wall, he intoned. They’ve paid for it, we’ve done all we can to help them use it. So what if the reps spurn it? Microsoft have made billions shafting their customers so where’s our problem?

Well, thankfully times have changed. Firms no longer pay huge sums upfront for software. The ability to ‘rent’ databases that require potentially no internal IT resource has meant many companies are trying a new system with every new regime, or even financial year, to pinpoint one that works for them.

Of course, as the industry knows, none of the systems ends up working for them. Crm adoption is on the floor. It was heartening to note that Selling Power shared my experience that salesreps cannot be told that they’d only get commission if the crm was filled-in (”Coercion creates resistance”). They prefer to see extra bonuses for such diligence.

But then, I wondered if anyone had ever mapped crm adoption? When on-demand pioneer Salesforce announced their ‘adoption dashboard’, they must have realised it would expose them. I wonder what “safeguards” they built in?

The last person running a salesteam that I spoke to expressed the usual laments about paltry crm usage. He had 8 reps on the road. I suggested it wasn’t all doom and gloom. Of those 8, I suggested 2 would be addictive users. Another 2 would have never even logged on (although the likelihood bizarrely was that these were 2 of the top reps so maybe there wasn’t a huge problem!) and the other 4 could be nagged, chased and tazered into using it and when they did, at least the bare miniumum would go typed in. He acknowledged how accurate my numbers were. I wonder whether these are the same the world over?

This is a chap that switched recently from Salesforce to NetSuite. So I guess he’s paying around £400 a month. How does he evaluate if he’s getting value for money? I bet he doesn’t have to. Because even in these downturn times such an amount will forever be below the radar, as whenever the bean counters question it, they’ll simply be told they have to have it…

Post Neo-Classical Pitching

salespodder — Mon, 06 Oct 2008 10:24:29 +0000

We appear to have bumbled into credit crunch followed by financial meltdown. The left-of-centre governments of Clinton and Blair over a decade ago, to little Opposition, led the encouragement of lenders to allow people to borrow mountainous sums, with little recourse to whether the interest payments could be maintained, let alone the principal ever repayed.

Unchecked, the banks went bananas. We now see that they lent recklessly, sold on those debts to other banks, fattened their income statements through huge commissions and left their balance sheets one sneeze short of starting an influenza pandemic.

According to engaging economist Robert Sidelsky, it’s Farewell to the Neo-classical Revolution. Unfettered Financiers will be a thing of the past. Here’s a flavour:

“The just-collapsed credit bubble, fueled by so-called special investment vehicles, derivatives, collateralized debt obligations, and phony triple-A ratings, was built on the illusions of mathematical modeling.”

The bonanza is now at an end. The immediate reaction from anyone outside the finance sector was succinct; let them fry. Yet on reflection, schadenfreude shifts to fear. Everyone from housewives to chief execs are keeping their purses shut tight, corporate POs confined to locked cabinets.

The problem now is that no-one wants to spend. Thrift is replacing the excitement of gaining credit. This is undoubtedly going to create problems for us solution sellers. How do you prompt people to spend on your wares?

Well, it’s a toughie. I myself am hearing customers already calling to question next year’s contracts. Here’s two strategies that could benefit us:

CFO Conversation

This must be an opportunity to get on the radar of the chief cheque-signer. Most vendors, when confronted with a demand to reduce prices, will meekly acquiesce. Avoid this trap by asking for a forum with their top bean counter to discuss financial matters. If apt, why not take along one of your finance bods? Ensure first that they are neither eosophobic or phengophobic (just think of a vampire at dawn!). The aim should be to uncover their funding plans. This could be dynamite. Imagine that they’re unaffected. Working capital provides for all their needs, say. Maybe a simple change in payment terms can keep you ‘in’.

Reduce Supply, Not Margin

So there’s no way around it, you’re facing a cull. Again confronted with the unpalletable, when ‘asked’ most vendors will drop their price. If a client states that to keep their business you must cut your price by 10%, you might consider this a small price to pay. But the impact on margin could be horrific. At 40% profit, a 10% price drop reduces your margin by 25%. Work out what each part of your supply costs you, and offer to reduce those costliest bits. A main point is, that whenever you do reduce price, you must get across it’s conditional you’ll reduce supply too. It’s surely preferable to discuss supplying 90% of last period’s product for 90% of the price, as opposed to 100% of previous supply for 90% of cost.