It feels like yesterday when I was saying goodbye to 2010 and hello 2011. In the blink of an eye, 2011 is more than half way over.
Tomorrow we welcome the “dog days of August.” As a salesperson, I hated August more than any other month. It seemed like the world stopped, no one was available and every day was hazy, hot and humid.
August is, in fact, a very difficult month for sales and marketing activities. It is also an opportunity for those salespeople who take advantage of the slower pace August allows. I can’t do anything about the weather (and all indications say August is going to be really hot for most of the US), but I can give you some insights into how to make August a productive month that can drive a profitable fall.
I asked my friend, and Get In The Door expert, Caryn Kopp to share an article she wrote a couple of years ago about August. She generously said she would. So, please review the keys to making August productive.
John Wanamaker famously said, “I know half the money I spend on advertising is wasted, but I can never find out which half.” If you’re involved in a small or mid-market B2B company, you probably wish you were only wasting half of your marketing money.
One of the largest vulnerabilities of small and mid-market (SMB) companies is that they under-invest (in a BIG way) in marketing. It’s not unusual to find companies doing hundreds of millions of dollars in revenue that have virtually no marketing function whatsoever.
How can this be?
The answer is quite simple – marketing, at least how it’s primarily taught and implemented – DOESN’T WORK!
The fundamental problem with 95%+ of SMB marketing efforts is that the marketing effort is disconnected from the sales process.
There are only two reasons that a company should market:
- Get more business
- Keep the business they have
You don’t market to create awareness, you don’t market to create thought leadership, you don’t market to make yourself feel good. The only reason you should spend a dollar on marketing is because it causes revenue to increase.
Awareness only matters if that awareness moves one down the (new) marketing funnel, towards becoming a customer. Thought leadership only matters if it moves a customer to action.
And the reality is that most marketing activities don’t move people to action and are completely disconnected from “creating customers.”
The reason for this is simple. Virtually everything espoused from (so-called) marketing experts is merely a rehash of consumer-product marketing, weakly translated for SMB B2B companies. I’ve got news for everyone, what works for Proctor and Gamble, Coca-Cola and McDonalds DOES NOT WORK for the $5 – $500 million B2B company, and it sure as hell doesn’t work for companies smaller than that.
Terms like “top of mind awareness,” “wallet-share,” “brand image,” etc. matter when you are competing to influence a decision that is made in less than 3 seconds, in the aisle of a grocery store where your competitor’s products are sitting right next to yours. When you’re competing in markets of millions of customers the game is different.
The B2B sale is a completely different beast. With B2B the sale can take years (even if your “sales cycle” is months). There are multiple people involved in buying, and they all have competing priorities, values and interests. The investment you are asking them to make is magnitude’s larger, and the risk is huge! Whenever change is involved buying, the entire decision process is skewed.
In B2B, marketing’s job is to cultivate. It must soften the market, helping them understand the value proposition you bring to the table. It must provoke and educate, focusing on the problem rather than the solution. It must be a process that is fully, completely and totally integrated into sales process. Failure to do so puts your entire customer creation efforts in peril.
This book review originally appeared in Baltimore, Washington and Philadelphia SmartCEO Magazine June issue.
Nearly six years ago I wrote a blog post about my fascination with the simplicity of music.
Think about it, there are only 12 notes in music (and from what I understand only 5 notes are used 80% of the time). Despite that we can enjoy music as complex as Bach and Beethoven, as simple as a Cars tune, as mind numbing as The Grateful Dead or Pink Floyd and as rocking as a Springsteen or Gun ‘N Roses anthem.
In twenty years working with more than 1,500 small and mid-market companies, I’ve learned that business and music have an awful lot in common. Building a successful, highly profitable growth business is a complex result; however, the process of getting there is a simple one.
The most common reason businesses fail to reach their potential, and instead stall, is because the entrepreneur or business leader embraces too much complexity. Companies are constantly trying to “differentiate” themselves. They are constantly trying to “add value” and “innovate.” Too often, companies make things complex for the sake of making things complex.
Sure, they claim the complexity is necessary so that their clients and prospects will understand how they are different. They say their solutions are complicated and they don’t want to “dumb things down.” The reality is that the complexity merely commoditizes them in the marketplace and confuses the people inside the business.
Just as John Williams used only five simple notes to compose one of the most memorable and intense themes (Star Wars), the key for business executives is to find the simple rules that will guide every aspect of their decision making.
With those thoughts in mind, I came across Andy Kessler’s most recent book: Eat People: And Other Unapologetic Rules for Game-Changing Entrepreneurs. For those that don’t know Kessler, he’s an enigmatic, contrarian ex-hedge fund manager. If that description hasn’t turned you off, it’s a good bet you’ll enjoy his books.
Kessler is one of my favorite business authors for three reasons. First, he is the prototypical cynic; second, he takes nothing for granted and investigates everything; and third, he is an entertaining writer. In Eat People, Kessler investigates the cause for the massive wealth creation he has witnessed.
He calls these wealth creators “Free Radicals” as they operate outside the norms of business and create great wealth for themselves and for the greater society through the impact their endeavors have. He shares 13 simple rules that should be followed by anyone desiring such success.
Here are his rules:
- If It Doesn’t Scale, It Will Get Stale
- Waste What’s Abundant to Make Up for What’s Scarce
- When In Doubt, Get Horizontal
- Intelligence Moves Out to the Edge of the Network
- Wealth Comes From Productivity, Everything Else is Gravy
- Adapt to Humans; Don’t Make Them Adapt to You
- Be Soylent – Eat People
- Markets Make Better Decisions Than Managers
- Embrace Exceptionalism
- Be a Market Entrepreneur and Attack Political Entrepreneurs
- Use Zero Marginal Cost to Create a Flood (or Someone Else Will)
- Create Your Own Scarcity with a Virtual Pipe
- Money Sloshes to the Highest Returns
Kessler has spent most of his life making money in the technology sector and his rules are geared to the technology industry. While his stories are entertaining, the real value is not the rules he comes up with, or the stories he tells (though they will make you a hit at the next cocktail party); it’s the process he used to come up with his rules and in how he applies his rules to make decisions.
Success in business requires three key components: effective systems, the right people to support those systems and the tools/resources that support the people and the systems. Management guru W. Edwards Deming taught that every business problem, at its heart, is a systems problem. Yet most businesses treat everything as a people problem.
Kessler doesn’t teach a business system in Eat People, but he goes a long way to making the extraordinarily complex, remarkably simple. And that may be the most difficult task in business.
When determining the focal point of your sales efforts, you must understand two characteristics in potential buyers:
- There are those who can, and
- There are those who care.
Those who can. have the power to make changes. They might not be able to change things by edict, but they have real power, influence and enough control to cause change to happen. Those who care, deal with whatever it is you are talking about regularly, they live with the pain.
The objective is to focus your sales strategy on the people who can AND who care.
The challenge is that often those who can, don’t care about what you do; and those who care don’t have the power or influence to cause change.
Because most companies take a solutions (instead of a business results) approach, their focal point is often too low in the organization, and those who care, can’t do anything. For example:
- I worked with a relocation company. Their problem was that the person who lived with the relocation program problem had no power to change the process or resource allocation decisions to fix it.
- I worked with an audio/visual teleconferencing company that promised increased productivity and longer life of equipment. Their problem was that they geared their approach to the facilities manager who didn’t care about productivity and had no control over budget.
- I work with an IT company that promises efficiency and a more positive environmental impact. The problem is that the people who manage the process they impact (they’re the ones “who care”) have little to no power in determining how the process will be defined or implemented (those who can).
When confronted with challenges like these, you must identify who has enough power to lead to the change you want and answer the critical question, “What do they care about that we can impact significantly enough to matter?”
In the case of the relocation management company, we realized that we needed the authority and sponsorship of the senior HR people AND the CFO/Finance office. As mentioned, we knew they didn’t worry/care about the relocation program. What they cared immensely about was having the best talent to drive company initiatives. So we stopped being a relocation company that supported talent; we became a talent management company that supported relocation.
Please know, that it required more than a shift in semantics. It required a shift in being. We started conversations at talent, and the talent issues that prevented them from achieving their business results. We then traced those issues to how a relocation program impacted them. Then we were able to work deeply with the people who cared, with the support of the people who could do something about it.
- How good is your service?
- How good is your product?
- How good is your sales effort?
My bet – you probably answered that it’s pretty good; above average.
Now think about it. What’s the state of customer service today? Most people would agree not particularly good. Yet why is it that just about every individual company thinks their service is great? It’s the Lake Wobegon Effect gone wild.
The same is true for sales teams. As I reported late last year; The Harvard Business Review released a damming report on the state of the corporate sales force. Yet most companies insist they’re good at sales.
Why does the effect impact so many people whose stated desire is to overcome their barriers and achieve extraordinarily profitable growth. I think it’s because we all have a tendency to judge ourselves through the prism of our intent. We desperately want to care about our customers. We want to be excellent at sales. Everything we do makes sense to us, at least at the time we do it.
I’ve spent a lot of time working and speaking with top performers – in business and sports. What of the commonalities I’ve noticed is that top performers are always sensitive and nervous (even paranoid) about what they are good at. They tend to be very harsh judges of themselves. Average and below average performers tend to be overconfident. It’s almost like the belief that you are really good at something, is a symptom that you may not be good at it.
I’ve also learned that all progress begins with honesty. My advice – embrace the vulnerabilities of you business. For it is only by improving that results get better.
Do you want to know another word for solution? It’s commodity. That’s right, any time your focusing on a solution, your solution, you are focusing on a commodity.
Let me share some examples:
- ABC company develops unique solutions. Really, it’s ABC company develops unique commodities.
- ABC’s dynamic solutions enable companies to create advantages. Really, it’s ABC’s dynamic commodities…
Think about that. How can a commodity be unique? How can it be dynamic? It can’t!
A commodity is anything with a perceived alternative – and every solution has an alternative.
Last year I shared some important insights into pricing and how to increase the desire people have to pay you more. I talked about the importance of focusing on the right-side of the value equation, not the left.
Solutions are at the core of “left-side value.” Results are the core of the right.
When you focus on the real results companies desire, you’re having a “what’s it worth conversation.” When you spend your time exalting the superiority of your solution, you are merely commoditizing yourself.
So, get out of your own way. Forget about you and focus on the customer. Understand them, and what it is they really want. What are their end results? Tie them back to your approach, and the solution takes care of itself.