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Is BlackBerry A Dead Product Walking?
There are 2 types of companies in the world today. You are either:
- The best, or
- You’re a “Me-too” company
Only “best” companies will earn margin premiums and enjoy the growth worthy of the hard work of business executives and salespeople.
I’m becoming increasingly convinced that BlackBerry is rapidly falling into the “Me-too” category, and will become increasingly irrelevant (and less profitable) going forward.
Full Disclosure: I’m an Apple fanatic (of course, if you’re reading this blog, you probably already know that). I’ve owned every version of the iPhone within a week of its release. So maybe that colors my thoughts, but I don’t think so.
One of the fundamental precepts of great businesses is to narrow your market focus and expand your yield. Great companies are maniacally focused on who their customers are – and who they aren’t. Jim Collins made that clear in his seminal book Good to Great.
BlackBerry, at one time, was an absolute killer device. I had one and loved it. Ever since the iPhone came out, and the smart phone category exploded, BlackBerry has been struggling with finding its place. The Storm was a disaster (on all counts), and they continue to lose market share.
To fight that, they keep “innovating” and coming out with new products. A recent view of their website highlights seven different models to chose from. So I ask, what is a BlackBerry?
In contrast, Apple offers one model (two if you consider the fact that they are still selling the 3GS), and no one need ask the question, “What is an iPhone?”
Watching BlackBerry’s approach reminds me of the 1991 movie, Other People’s Money. In it, Danny DeVito played the memorable character Larry the Liquidator. In trying to takeover a dying company, he said:
We’re dead alright. We’re just not broke. And you know the surest way to go broke? Keep getting an increasing share of a shrinking market. Down the tubes. Slow but sure.
Here’s my corollary:
You know the surest way to go broke? Keep introducing more new products while you continue to lose share of a growing market. Down the tubes. Slow but sure.
Think about this for a moment. Who loves – I mean really loves – their BlackBerry?
Heavy duty email users – that’s who.
Email was the entire basis of BlackBerry’s success to begin with. They invented technology and a device that solved a critical problem for people.
Now, what’s their newest device? The BlackBerry Style. Huh?! What?! If someone is buying a phone for “style;” guess what – they’re buying an iPhone.
People who buy BlackBerrys buy them for function. BlackBerry is superior to the iPhone if email is critical. The iPhone is superior in just about every other way.
What Should BlackBerry Do?
To ensure its future, BlackBerry needs to stop playing other people’s games. They need to focus on their core market – heavy duty email users.
Is that a smaller market than the size of their current business today? Yup. But guess what, BlackBerry isn’t as big as it thinks it is.
BlackBerry needs to answer the same question that small and mid-market companies are faced with every day:
Do I keep fighting for volume and size which will result in less profit and greater vulnerability, or do I accept the market for what it is and focus on what we do best and become relevant?
What would you decide?
Peyton Manning, Rex Grossman & Demand Creators
Who’s a more expensive quarterback: Peyton Manning or Rex Grossman? The answer is that it depends how you measure expense.
- If you look at it from the perspective of direct cost (who gets paid more) the answer is clearly Peyton Manning – heck, Rex Grossman is a bargain by comparison.
- If having a viable chance of playing in the Super Bowl is paramount then most people would agree that Rex Grossman is more expensive. The likelihood of making the Super Bowl if far, far lower with Grossman than it is with Manning.
Sellers deal with this paradigm everyday. Buyers naturally assess decisions based upon the perceived cost of taking an action. The primary job of a Demand Creator is to create the paradigm that allows buyers to make decisions based upon the desired returns.
This is why it is absolutely critical that sellers establish and focus on the desired results that a buyer is looking for, rather than focus on the means to achieving the result.
Sounds simple, but I’ve learned it’s not. A common mistake sellers make everyday is that they confuse “process goals” with “results goals.” For example:
- Reducing headcount is not a result – it’s a means.
- Consolidating vendors is not a result – it’s a means.
- On-time delivery is not a result – it’s a means.
Results are the impact of those means.
If a company is looking to reduce headcount, the result may be to lower it’s overall cost structure to be competitive in tighter markets. And that opens up a series of questions and potential implications, about what really drives their cost structure.
- The seller that focuses on how they support headcount reduction will be valued like Rex Grossman.
- The one that focuses on how they support a lower cost structure will be valued like Peyton Manning.
It’s your choice.
Product vs. Service Sale: A Crucial Distinction
For as long as I’ve been in sales, guru’s have always focused on the differences between selling products and selling services. The approach, skills and talents required to successfully sell products are quite different from those needed to successfully sell services.
A major trend I’ve noticed over the last 5 – 10 years is that the distinction between “products businesses” and “services businesses” has become increasingly blurred; as product oriented companies have added services, and services companies have “productized” their offerings.
While the distinctions between companies has grown more nuanced, it’s impact in the selling process hasn’t. It’s critical that you decide if you are selling a product or a service. This simple statement of need can best illustrate the difference between a product and service sale:
Which word do you focus on – “it” or “now?”
If you focus on “it” over “now” you are making a product sale. You’ll focus your sales process, marketing and positioning on the product being offered. You’ll gear your sales efforts to late stage buy-cycle opportunities. Because your focus is on the product, you’ll deal with commoditization on a regular basis (you may even be the chief commoditizer), and as a result your margins will be tighter; hence, you’ll focus more on volume.
If you focus on “now” over “it”, you are making a services sale. You’ll focus your sales process, marketing, and positioning on the consequences of not getting it now. You’ll spend more time educating your customer base on the barriers to “now” and the impact that “now” has on their organization. Your efforts will focus on radical differentiation, and while your volume may be lower (everyone that needs “it” doesn’t need it “now”), you’re margins will be much higher.
A perfect example of the two can be seen between the two most profitable companies in the technology space:
- Microsoft focuses on “it,”
- Apple focuses on “now.” (Realizing that “now” is a metaphor.)
The Big Mistake
Everyday I see companies, especially small and mid-market ones, make a critical mistake. They try to focus on both “it” and “now.” At the risk of over-simplifying the issue, let me be clear:
You must focus on either “it” or “now;” you cannot focus on both.
For those that have been reading this blog for a while, you realize that the product sale focuses on “left-side value,” while the service sale needs to focus on “right-side value.” When you try to focus on both you fall in the middle, and there is no room in the middle.
The middle is Death Valley. You face the on-going margin pressure like a products company with the increased complexity and costs associated with services businesses.
When you’ve chosen which sale you will focus on, your job is to ensure that everything you do – the questions you ask, the ads you run, the social media strategy you implement, etc. – is completely aligned behind the decision.
I am not saying that the product or the service sale is either good or bad. My point here is that they are different. If you want to accelerate your profitable growth in the future you need to chose one – and only one.
Revisiting: What Do You Sell?
In April, I discussed the need to shift from selling “stuff” to selling results. Making that shift requires a change in mindset far more than merely talking about what you do differently. In your mind and actions, you must change the focus of what you sell.
For example, at Imagine, our promise is:
- More sales
- Faster sales
- More profit per sale
One of the things we do to help companies achieve this is 1:1 sales coaching of their salespeople.
If we start our conversations about their salespeople or their coaching/training programs, then we are selling on the left side and will be commoditized. Even if we’re asking questions and learning what they like or don’t like, we are in the “we-do” trap and our sales process will get bogged down.
This is true even if the customer/prospect calls up in search of sales training/coaching (or whatever it is that relates to what you sell). As a matter of fact, this is one of the most common – and costly – sales traps out there. The customer sounds like they’re looking for exactly what you provide, using the exact words you use to describe it. Figuring you’ve got a “lay-up”, you explain your stuff and before you know it the customer is lost or pressuring you on price.
From the very first moment you engage with a customer, you’ve got to make a critical decision: are you going to focus on the stuff or on the result? If you’re going to focus on the result, which is critical if you want to be selling on the right side, then you must not engage at the tactical level until the result has been clearly defined, as well as (at least) the initial barriers to achieving that result are identified.
When I get a call from someone who wants to talk with me about doing sales training, my response is always – “What do you want to do sales training for?” When they respond, “To increase sales,” I follow up by asking them to explain what is preventing them from making the sales they desire.
That opens up a line of questioning and conversation that allows me to radically differentiate our programs and create the value necessary to make profitable sales.
Design Thinking In Sales
A few weeks ago, I shared a review for The Design of Business, an excellent perspective on design thinking and strategy. Since reading the book, I’ve been far more aware of how this type of thinking provides a critical advantage in the sales process.
Successful selling today requires that you be able to get your customers to understand the limitations of the status quo and to develop complex solutions that can be easily understood. You must have the ability to understand your customer’s current (perceived) reality and to enable them to see how your solution can effectively change that reality to create a better one.
This requires a dynamic-type of thinking that is missing in many sales organizations. Design Thinking is ideal for this effort. Combining the strengths of deductive reasoning and inductive reasoning, “Designers” can lead frustrated buyers to the future they desire, while driving high-margin sales opportunities.
By no means do I think every salesperson must become a “Designer,” but every sales organization needs to have a least one.
If you’d like to learn more about Design Thinking, you can download this article from Harvard Business Review (subscription required) or get the book The Design of Business (affiliate link).
Understanding Your Customer’s Time Scope
Most organizational charts are broken down, and viewed, from the perspective of position and authority. While this can be very helpful in developing sales strategy, an even better way to break it down is by what I refer to as their “time scope.”
For some people, one week is a long-term, while others spend little time thinking about anything happening in less than two years. Here is an example (albeit oversimplified) of how typical levels break down to time scope:
| Level | Time Scope |
| Senior Executives | Beyond a year |
| Upper Management | 6 mos – 1 year |
| Middle Management | 3 – 6 mos. |
| Front Line Management | 1 month |
| Front Line | 1 Day – 1 Week |
When you have a clear picture of your customer’s time scope, you’ll be able to gain insight into what it is they really worry about, where the value you can create lies, and whether the issues you are dealing with are big enough to get them to change their approach.
Looking at your customer from this perspective also aids you when you are selling to smaller companies where individuals (especially owners, CEOs, and other executives) play more than one role. Knowing their natural scope can be a great advantage.
The longer your buyer’s time scope is, the more opportunity there is for you to create value and radically differentiate the results you can provide. Shorter time scopes significantly limit, or even eliminate, any opportunity to differentiate yourself in a meaningful way.
Unless you are selling a pure commodity, your first “sale” is to ensure that you are talking with the person with the proper time scope.
Are Your Customers Asking The Right Questions
There is nothing more important for you to know than the questions the customers and prospects in your market are asking themselves. I’ve said it before, the company that provokes the right questions owns the market.
If you want to know what types of decisions someone will make and/or how they will allocate their limited budget dollars, knowing the questions they’re asking is critical.
| Are they asking: | Or: |
| How can they get additional price concessions from vendors? | How can they gain improved performance from vendors that can enable them to lower their total costs? |
| How can they centralize their decision making to their purchasing department? | How can they utilize the intelligence that lies outside their organization to gain and exploit competitive advantages? |
| How can we build our capabilities internally? | How can we transform fixed costs into variable costs by better utilizing the capabilities of others? |
| How can we utilize the past to drive improvements? | What do we need to know to ensure that we can compete effectively in the future? |
If your market is the questions on the left side, you are clearly in a “What’s it Cost Conversation.” If they’re asking the questions on the right side, you’ve got an opportunity to discuss what it’s worth.
What questions do you want your market to ask themselves?
Selling Before The Buying Process Starts
The definition of a great salesperson – or a Demand Creator – is someone who can sell when there is nothing to buy.
I don’t mean that you can sell ice to Eskimos, but that you can get conversations started before the customer/prospect has identified their need and begun the buying process. When you can do this, you gain two critical advantages:
- You are able to provoke awareness and create demand.
- Because there is nothing to buy, none of your competition will be there.
To be able to create demand like this, you must stop thinking of yourself (or acting) as a salesperson. Instead, you must truly become a businessperson who sells.
To begin the process of creating demand, and selling when there is nothing to buy, follow these four steps:
Step 1: Identify the problem you intend to solve. This should be a high probability/high value problem that impacts the types of customers you best serve.
Step 2: Answer the question – “Who gets fired if this problem isn’t solved?” The reality is, in today’s sales drought if the problem you want to provoke isn’t big enough for someone to potentially lose his or her job over, it’s not a big enough problem to create budget for.
Step 3: Determine if the person you have targeted has the authority to do something about it. There are two types of authority worth pursuing:
- The best is the authority to launch an initiative and allocate budgets to fix the problem.
- The second type is the authority to get you the attention of someone who can launch an initiative or allocate budget.
Step 4: If the answer to Step 3 is “no,” then you must go back to Step 1 and identify a bigger problem you can impact.
Five Years From Now
Think about your typical customer using your typical product/service. And I mean typical – the customer and the offering that is at the center of the commodity part of your business. What is it that they’re getting? Why are they buying it?
How commoditized was that part of your business five years ago? My bet is that your commodity today was an absolute home run five years ago – if it even existed back then.
Now think about your home run today. Where will it be on the commoditization spectrum five years from now? Probably obsolete.
The dominant strategic question in every CEO’s mind should be:
Why is it that people will be buying from us in 5 years?
Take a moment and ponder that question. Now, what are you doing today to pave the way for that future? Remember, your profits today are the result of you efforts from the past – and your profits tomorrow will be directly tied to the actions you take between now and then.
Don’t get lost in the answer to this question. The reality is that it’s virtually impossible to have any idea what we’ll be doing in 5 years or what our customers may need. But, the focus of 5 years is important because it forces you to break out of your company’s comfort zone and to prevent you from becoming complacent.
It is the job of the vast majority of the people in your company to maximize the results of your current business – it’s your job to figure out what that will be in the future.
Commoditization Is Still The Enemy
I was talking with my friend, advisor and client – Gini Dietrich, and it hit me that I’ve been blogging for 5 years now. So, wanting to avoid some work for a few minutes, I thought it would be fun to go back and look at my first few posts.
I have to admit that as I read them, I was surprised by how applicable they still are today. My first content post was titled Commoditization Is The Enemy of Growth. Unfortunately – it still is. For your benefit, I’m posting it again:
How easily can buyers quantify the differences between your offering and your competitors? How easily can your customers make those same distinctions? How can you continuously differentiate your company when market forces are constantly commoditizing you? Think about that question for a moment. It is the greatest challenge facing businesses of all sizes in the 21st century.
Commoditization is the evolutionary process that reduces all offerings to their lowest common denominator. Commoditization is the situation businesses find themselves in when their focus is mainly on their offering instead of the quantifiable difference their offering delivers to their customers. I have asked over 2,000 businesses why people should buy from them. Virtually all of the answers fall into the category of “we are better,” or “we give more value” and virtually all of those answers propel the business into commoditization.
“Value creation” is among the most common buzzwords used in business today. There is only one meaningful definition in business for the word value: something buyers would be willing to pay for. Your company can do great things, but if people aren’t willing to pay more for it, your company is not creating value.
So I ask: What are you doing to break away from commoditization? How are you making value creation a core discipline of your company?
Do You Have Competition?
Let me be clear:
If you’ve got a viable business you’ve got competition.
I often hear executives claim that they don’t have any competition. I even catch myself saying it about Imagine, sometimes. The reality is, no matter how “unique” your products/services are, your customers and prospects still have alternatives. You may (and I emphasize “may”) not have any direct competition, but you certainly have:
- indirect competitors, and
- the toughest competitor of all, the status quo.
People don’t buy products and services so much as they “hire” a product or service to do “a job.” This means that if some doesn’t have a problem (a job to be done) there is no opportunity for [a sale]. The only offerings that can have no competition are the ones that do a job that nobody wants. To be accepted in the market, you must be able to define the job that you are asking people to hire your product/service to do.
This is an important distinction, because a critical strategic decision for any business is how you define your competition. The brain of your customers/prospects requires contrast to understand and act. Your definition of competition is what makes it possible to radically differentiate your company (think about it – how can you contrast with nothing?).
Example
When I started Imagine, I thought I had an approach that was so unique that no one did what we do. So when asked who my competitors are, I brazenly responded: “We don’t really have competition. No one does what we do.” That, of course, got me nowhere. I was so focused on getting people to understand what we weren’t (we weren’t Sandler, we weren’t Miller Hieman, no we weren’t a marketing agency, and so on) that no one could understand what we were.
I realized that I needed to define my competition. The easiest way to do that was do compare us to “sales trainers.” But, I knew that sales training was a highly commoditized, highly competitive market and that it would be virtually impossible to stand out or to earn the fees we needed to deliver the results we promise.
Stuck (because I could define what we weren’t, but not what we were) I asked myself, what is the job that someone is hiring us for?
My first thought was that people were hiring us to do sales training. But I knew that didn’t do us justice. So I pondered it more and I realized that no one wants sales training – what they want is more sales. More, profitable sales and faster sales. That was our job – to enable companies to get more sales, faster sales and more profit per sale.
Now defining my competition was easy – we compete (and cooperate) with virtually any product or service designed to help companies with their go-to-market strategy. This completely changed the focus of my company, enabled us to attract some great clients that would never of hired us to merely do sales training, and it gave us a track for successful innovation. Today, we continue to pursue that journey.
Now it’s your turn. What “job” do people hire your products/services to do? What else is competing for that job?
3 Keys to Building High Performance Sales Teams
On Thursday, June 24, 2010 I’ll be sharing some secrets great companies know that have enabled them to build and sustain high performance sales teams. For most of the last 20 years, a good sales team was enough to enable your business to be relatively successful. Great sales teams were always beneficial, but the reality was that the costs – in time, effort, disruption and money – were often too high to justify the effort.
That is no longer true. Going forward, businesses must invest the energy and the resources necessary to sustain high performance. The costs of failing to building a great sales capability will threaten the sustainability of your business.
The Drought we all live in now means that are fewer resources available to support your solutions. The only way you’ll be able to drive the margins you need to be successful will require you and your organization to be better than ever in the selling function.
As a preview to Thursday’s webinar, I thought I’d share the three most critical prongs of a high performing sales organization:
- At the foundation of every great selling organization is a great process. What made IBM and Xerox the best selling organizations in their day was a superior sales process – not hiring superior salespeople.
- In the future, salespeople will not staff superior selling organizations. Let me repeat that – salespeople will not staff high-performance sales teams. Instead, they will be staffed by businesspeople who sell. The single biggest contributor to a salesperson’s ability to succeed will be their level of business acumen. High-performance companies invest in the business acumen of their salespeople.
- Great selling organizations provoke the awareness of problems, rather than provide solutions. As I’ve written before, solutions are worthless. To drive the demand and the margins, you need to be successful, you can no longer wait for potential buyers to realize they need you. Your company and your salespeople must be able to effectively provoke awareness before your customers and prospects know they need you.
If you’d like to learn more about how you can apply these three critical prongs, join us on Thursday, June 24, 2010 at 2pm EDT.
Building High Performance Sales Teams
For most of the last 20 years, businesses and salespeople have had a tremendous tailwind supporting their sales and growth. Over the last 3 years, that tailwind has disappeared, and in some cases has become the wind that holds businesses back. While good used to be good enough, going forward the price you pay for having a good sales team instead of a great sales team will multiply. So, the question that must be answered is:
How does a company build a high performance sales team in the middle of an economic storm?
On July 1, 2010 at 2pm EDT I will be hosting the latest in our Demand Creator Webinar series. This month, we will be focusing on Building High Performance Sales Teams. I’ll be sharing with you the most important secrets that the greatest selling organizations know, along with the roadmap to enable you selling efforts to become an unbeatable competitive advantage.
For just $99 you’ll learn:
- The biggest myths in developing an effective sales team
- The 3 critical actions needed to build a high-performing sales team
- How to determine where your sales team stands
- The most important difference between great sales organizations and average ones (it’s probably not what you think)
PLUS
- We’ll answer all of your questions about building sales teams
You’ll learn:
- Whether your sales team will get you where you want to go or not
- To identify specific actions to improve your sales efforts immediately
- To have a clear path and plan to make your selling efforts a competitive advantage.
Whether you’re currently leading a sales team, considering building one or even if you’re a salesperson yourself, Building High Performance Sales Teams is a must attend webinar if you want to make your selling efforts a competitive advantage.
How To Win With Purchasing
Let me tell you a secret that all great Demand Creators know – purchasing or procurement is your friend. That’s right, Demand Creators love the purchasing and procurement function.
How? Why? Here are some reasons:
- Purchasing is a brick wall that prevents good salespeople from breaking through, so Demand Creators gain a significant advantage.
- Purchasing is the grand commoditizer and, as such, plays right into a Demand Creator’s ability to radically differentiate.
- Demand Creators realize that purchasing people are people too, and are motivated just like everyone else. This knowledge allows them to gain significant control in guiding how purchasers make decisions.
If you want to be one of the few (probably less than 5%) of salespeople who know how to gain an advantage, here are some important tips to keep in mind:
- Purchasers, like everyone else, are motivated by achieving business results. The problem for sellers is that the results they seek often are not in alignment with the purpose of the sellers’ core offerings. Your job, as a seller, is to first understand the results that they want, then demonstrate how you can achieve them.
- Purchasers rarely live with the pain that your offering is designed to solve. So, the more you talk about superiority and expertise, the less you are going to impact them. You must talk with purchasers about critical issues for them.
- Most importantly, you need to understand the people in purchasing are responsible for one primary function: purchasing the proper specs at the lowest possible price.
So, if you want to impact the decision without lowering your price, you must get the buying organization to change the specs. Simply put, if you change what it is that purchasing is looking to purchase, then the budget and the decision that purchasing makes will change as well.
To truly succeed when procurement is involved, you must influence the [decision criteria] that determine the specs. You must remember that procurement is not responsible for setting the specs – they’re responsible for fulfilling them. Other people, those who live with the pain, set the specs. Make sure you talking to them before they think they know what they want.
Please do not misunderstand this post. I am in no way saying that procurement is unimportant or should be avoided. They should be embraced and supported in the context of enabling your customers to achieve their critical results.
The Most Important Thing to Know in Sales
Anyone who has heard me speak knows that I believe business acumen is the most important capability for a successful selling. One of my goals in writing this blog is to support the development of business acumen in the sales process.
I started reading the book Seizing the White Space: Business Model Innovation for Growth and Renewal. I found the title interesting because I often advise executives to “seek the white space.”
Mark Johnson provides one of the simplest and powerful descriptions of what a business model is, how to understand it, and how to affect it. Looking briefly at the four elements from the four box business model, they are:
Customer Value Proposition (CVP) – An offering that helps customers more effectively, reliably, conveniently, or affordably solve an important problem (or satisfy a job-to-be-done) at a given price.
Profit Formula – The economic blueprint that defines how the company will create value for itself and its shareholders. It specifies the assets and fixed cost structure, as well as the margins and velocity required to cover them.
Key Resources – The unique people, technology, products, facilities, equipment, funding, and brand required to deliver the value proposition to customers.
Key Processes – The means by which a company delivers on the customer value proposition in a sustainable, repeatable, scalable, and manageable way.
Understanding your customer/prospect’s business model is critical – I repeat CRITICAL – to becoming indispensable. If you don’t understand, you cannot make The Shift to selling results, and you’ll find your company, your offerings, and your sales efforts increasingly marginalized.
When you do understand their business model, you can begin to answer important questions like:
- Which boxes do we impact?
- How do we impact them?
- How will our customers business model improve as a result of our impact?
- What is that worth?
With those answers in place, your customers will be far more interested in talking with you and far more open to sharing their needs with you.
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Resources
Doug's Washington Business Journal Columns- Intelligent Growth Articles
Third Wave Selling Blog
Products to Grow
