Hyper-Focus on “Big Game.”
Miss Big Revenue.

Existing customers may be fastest route to ROI

Guest Post by Brent Holloway

Ever hear salespeople referred to as hunters and farmers? Hunters “hunt” for new business outside the fold; i.e.: they convert prospects to customers. Farmers till the soil within, growing revenues from existing customers. It’s easy for companies to be enamored with their hunters, because they bring in the “big game” (big new deals), while farmers, who tend to close more, smaller transactions, often work relatively unrecognized in their shadow.

I’d like to suggest that you may be missing out on big revenue by focusing too much on big game.

I know every business is different and no single sales model is right for all, but your answers to the following questions might mean you should hire more farmers and consider putting them on quota. And maybe, just maybe, you should fit your hunters with a pair of overalls and teach them how to farm.

Answer “yes” to these…focus more on the farm.

1. Does more than 50% of your annual revenue (or some other % you consider significant) come from existing customers?
2. If you offer a wide range of products and services, do you find many of your customers only use one or a few?
3. Do you hear too often that your customers feel neglected, that they no longer receive the level of partnering or engagement they did when they first became customers?
4. Is your customer attrition or turnover rate higher than you would like it to be?
5. Are you losing more customers to the competition than you’re winning in return?

Answer “no” to these…you could be missing big revenue.

1. Do all customers have an assigned salesperson?
2. Is each customer contacted frequently enough?
3. Do you survey lost customers to find out why they were lost?
4. Have your salespeople run a gap analysis to assess which products and services each of your customers is using today?
5. Do your customers really know what you have to offer? (If you were to run a customer education campaign on the breadth of your product/service portfolio, you might be surprised how often customers say, “Oh, I didn’t know your company did that.”)

Of course you can’t ignore hunting. You’ll always need to offset some customer attrition and competitive loss. But the impact of optimizing sales to existing customers might be several times that of new business acquisition.

Here’s just one example. If 80% of your revenue last year came from existing customers and the other 20% from new customers, then a 10% increase in sales from existing customers would have the same impact on revenue as a 40% increase in sales to new customers (8% company growth from either scenario). In this case, the opportunity to hunt on the farm is greater than in the jungle.

Five ways to grow customer revenue

In closing, here are five suggestions to grow revenue from your existing customer base.

1. Cross-selling
2. Up-selling
3. Targeted campaign offers just for your installed base
4. Adding dedicated customer-focused sales resources (and putting them on quota)
5. Targeted price increases, where price sensitivity is low or inelastic

It’s often said that a company’s employees are its most important “asset,” even though they don’t show up on a balance sheet. I would argue its customers are an equal, if not more valuable, asset of this type.

What is your business doing to optimize the value of your customer base?

Want to see how your account team performs compared to others? Download our 2011 Inside Sales Renewal Metrics Report.

Brent Holloway, a Sales 2.0 leader (@Sales20Leader), is Sales Director for Verint Systems and my co-author on Sales 2.0 ¬ Improve Business Results Using Innovative Sales Practices and Technology. Thanks, Brent, for helping us see the forest from the trees, or should I say, “the farm from the jungle”?

Tags: account managers, cross-selling, customer base, existing customers, hunters and farmers, installed base, optimizing sales to existing customers, quota-carrying account managers, revenue, ROI, Sales 2.0, selling to customers, up-selling

37 Character Tweet Led to Multi-Thousand Dollar Opportunity.

Still think Social Selling is a lot of hype?

While large and small companies alike continue to puzzle over the impact of social media on sales, these giants in our industry are here to say it’s here to stay.  What giants?  IBM and Microsoft.  And they have the stories to back it up.

A few weeks ago I had a conversation with executives from IBM and Microsoft about their social initiatives.  Their results should help convince the most skeptical of executives about the virility of social to produce measurable revenue results.  Joining me in the conversation, which was hosted by The Customer Collective (many thanks!), were Bill Patterson (@bpatter), Product Planning and Strategy Lead for Microsoft Dynamics CRM, and Doug Hannan (@ibmdough), a business unit executive at IBM.com in marketing in North America.  Here are a few edited excerpts from our conversation.

Turned 37 characters into thousands of dollars

Anneke:  Bill…could you explain how your role at Microsoft relates to social media and sales?

Bill:  We find ourselves today helping organizations take advantage of social media to create much deeper engagement in the line of sales, service and marketing initiatives.  My job is to listen to the best examples – from companies all around the world – of how they use social media to boost their bottom line, so that we can, in turn, help deliver the right tools and solutions to help them take this new channel of engagement to new heights for their organization.

Anneke:  For the sports fans and business leaders among us, tell us about your NBA social media story.

Bill:  Sure.  As sports fans know, sometimes going to a stadium can be tough when your team isn’t performing as expected.  Yet ticket sellers still have a responsibility to fill stadium seats.  What we learned and shared with the NBA – a client of ours – is that one of the best times to sell tickets is during the annual draft process, when fans have the most hope for maybe a change in direction.  By mining social networks like Twitter, one NBA team was able to tap into the pulse and tone of how excitement was building for a player they had selected, and they simply tweeted something along the lines of “Exciting…can’t wait to go to a game next year!”  That simple 37 character response drove new leads and new sales lead conversions into their sales organizations in real time.  It turned into a multi-thousand seat … multi-thousand dollar opportunity.

Anneke:  These players – I was checking Twitter last night – have millions of followers, right?

Bill:  They do.  The opportunity for distribution is quite impressive and really gives these teams and organizations an opportunity to connect in new ways to both their existing fan base and plenty of potential customers, as well.

Quadrupled order volumes in first quarter

Anneke:  Doug, you’re not increasing ticket sales, but you are generating revenue for something recognized by those of us in technology as almost as hot – cloud offerings.  Can you tell us about your program and results?

Doug:  I’m happy to.  We wanted to understand our clients’ needs in the area of cloud computing, and we turned to social media to listen.  There are a lot of conversations happening on the web, but frankly there’s also a lot of clutter.  It’s hard to pick out what really matters.

We created a systematic approach of listening to marketplace leaders, and from there created some messages our sellers can use in their social conversations to foster a dialog with our customers. These messages might include referrals to industry experts, new information on how other clients are using IBM cloud computing, or other relevant information in this fast-paced area.

One of the differences in what we did is that instead of asking each seller to try and understand the marketplace, in a free-for-all environment, we organized our listening and presented messages to the sellers, who could then edit them, send, retweet, etc.  All they had to do was tailor the message to make it appropriate for their particular context.

Anneke:  A lot of companies are trying to figure out how to take one sales rep’s success with social media and scale it across their organization.  It sounds like you’ve found a way to do that.  What were the results?

Doug:  Our results were pretty exciting.  Our pilot included just five inside sales reps using 10 social promotions.  From that we grew our direct contacts by 480%, expanded our reach ten-fold, and quadrupled order volumes within the first quarter.

“Pretty exciting” is some understatement.  Bill and Doug had much more to share.  (I was like a kid in a candy shop!)  Here are just some of the topics we touched on…

• The value of listening and being responsive
• Social media policy
• Metrics
• Scaling social strategy across an organization and around the globe
• Compensation for social teams
• Sales and marketing collaboration
• And so much more

You can hear the entire conversation here – minus a few breaks where we had some recording difficulties.  My apologies!

Are you skeptical about social selling?  What are your fears?  If not, tell us what’s

Tags: IBM, Microsoft, Microsoft Dynamics, NBA, social media, social networks, social sales, social sales results, social selling, ticket sales

Guest Post by Brent Holloway:
Personalized Email vs. Mass Blast?

Brent Holloway is one of my favorite people, as co-author of Sales 2.0. He is Regional Sales Director, Witness Actionable Solutions at Verint Systems Inc. As a top notch, get-it-done sales leader, when Brent shares some advice, we all do well to stop and listen.  Let’s listen now to what he has to say about the dilemma of personalized email vs. impersonal mass blasts.

How do you decide?

When it comes to email marketing, sales and marketing managers frequently weigh the trade-offs between writing effective but inefficient personalized messages vs. efficient but generic mass blast campaigns.  How do you choose?  Consider the two sample email messages below.

Message #1:
Subject: XYZ Corporation Product Announcement
Dear Customer,
XYZ Corporation is pleased to announce the introduction of our 7th generation cloud-based super technology. If you are currently on maintenance, you have the option to upgrade with no additional license fees.  Attached is a document that summarizes some of the key enhancements and the top reasons why many of our customers will be upgrading to v7.  Please contact our sales department if you would like to learn more.

XYZ Corporation

Message #2:
Subject: Update from Eric at XYZ Corporation
Hi Susan,
I wanted to let you know that we are introducing our 7th generation cloud-based super technology.  Since you already use v6 and you are current on maintenance, you have the option to upgrade with no additional license fees.  Attached is a document that summarizes some of the key enhancements and the top reasons why many of our customers will be upgrading to v7.  Please let me know if you would like to schedule some time to discuss it further.

Thank you,

Eric Reed
Account Executive
XYZ Corporation
(408) 555-5555
—————————

Which would you prefer to send or, for that matter, receive?  I think we’d all agree #2 is better.  Now ask yourself, which message came from a corporate email automation system?  #1, of course. (I can hear the “duh!”)   But did you know that #2 also came from a corporate email automation system?

Leading marketing automation vendors such as Eloqua and Marketo enable tailored messaging that goes beyond simply entering the customer’s first name in the greeting.  For example, you can align each customer with their associated salesperson (this can be done manually or by importing from a spreadsheet), and the appropriate salesperson’s email signature can be automatically inserted at the end to give a more customized feel.  Taking it a step further, let’s assume your customers can be segmented into four major product categories.  You can write four tailored messages and the email system will insert the appropriate message for each customer, as well.  Finally, the content can be written to be intentionally informal to further enhance the feeling that it was hand written just for them.  Each customer’s email will appear to come directly from their salesperson and, in the second example message above, if the customer hits reply, the response email will go directly into Eric Reed’s inbox, even though it was sent from the corporate email system.

Does personalizing e-mail make a difference?

You bet it does!  One large enterprise software company (that prefers to remain anonymous) reported response rates that more than doubled when they used the personalized mass blast approach in the second example vs. the more generic, traditional automated email used in the first.

How many of you have tried a personalized approach to automated email? What have your results been like?

Tags: automated email marketing, customized email, Eloqua, email blasts, email campaigns, email marketing, Marketo, personalized email

14 Business-Killing Things I Learned About Selling to Tech Buyers

All because of someone I met on LinkedIn  

I was recently engaged in a passionate discussion with a new friend of mine, Kenny Madden, about the importance of understanding sales from the buyer’s perspective. He said something like “Who cares how a bunch of salespeople are defining Sales 2.0; the buyer has no clue what that is and doesn’t care. They just want us to do a better job selling.”  

You might think I would be offended, as co-author of the book, Sales 2.0.  On the contrary, I couldn’t have agreed more, because his in-your-face statement reinforced a basic premise of Sales 2.0 – it’s about a better way of selling to meet the expectations of today’s buyers.  Reinforcing my beliefs further, this discussion would never have happened were it not for social networking (an important tool in Sales 2.0).  Kenny and I have never met face-to-face or even talked on the phone.  We met on LinkedIn, have had several “conversations” on Facebook, and have exchanged e-mail.  Our entire relationship has been carried out online.  How cool is that? 

So what does all of that have to do with selling to tech buyers?  Kenny, true to his word, decided to listen to a bunch of tech buyers – 1.6 million to be exact – to get their perspective and learn what they want from those of us who sell to them.  From his online survey, here are the 14 business-killing things he shared in a recent blog. And – using another Sales 2.0 technique – I’m passing it on to our friends and colleagues.

The 14 worst things an IT vendor can do (in no particular order)

1. Cold call – don’t do any research about my company or business
2. Lie about your products
3. Don’t listen
4. Slam the competition
5. Assume IT decision makers have linear buying stages – you have to be on, “always on,” regardless of where I am
6. Poor, generic advertising and marketing that provides no useful information about you or your company
7. Not responding
8. Not being open about pricing
9. Pretending you have a relationship with my company when you don’t
10. Refuse to leave a voicemail with the receptionist
11. Argue
12. Thinking that I’m ready to buy simply because I downloaded a whitepaper
13. Making your technical information hard to find on your website
14. And my personal favorite…Thinking that the IT department has no juice; only selling to the C level (All they do is pass it to IT to vet)

Kenny, who works in market development at Spiceworks, the fastest growing IT social business network, went on to share the 13 best things an IT vendor can do, along with summary recommendations.  You can read his entire blog here.

 Another cool thing about Kenny…he expresses his passion for sales and marketing in art.  Here’s one of my favorite pieces from his collection, titled “I am not a Lead.”   

That’s the story of my latest great find on social media.  I found a new friend and like-minded colleague.  I gained some new insights into selling to tech buyers that I can pass on to my team and all of you.  What’s your best social networking story? 

Tags: IT vendors, Kenny Madden, LinkedIn, Sales 2.0, selling to IT, selling to tech buyers, social media, social networking, Spiceworks, technology sales

Six Ways to Woo SMB Executives

Dell’s DWEN Event Does it Right

If your company is wondering how to effectively sell to the massive SMB (small and medium-sized business) market, you are not alone.  Many businesses are realizing that they have to shift their sales models to profitably offer lower-priced or subscription-based products and services to volumes of smaller businesses.  Dell, an early leader in understanding how to sell to SMB, adopted inside sales and other Sales 2.0 practices at a time when selling computers direct – online and by phone – was not the norm.  My recent experience speaking at the DWEN (Dell Women’s Entrepreneur Network) event in Rio de Janeiro underscored what I already knew about their leadership and understanding of the large and growing SMB opportunity.  Here are six things that Dell does right with the DWEN event – practices you may want to emulate in wooing SMB execs.

1. Host a top-draw event at an exotic destination with huge market potential.

Dell’s decision to hold DWEN, an invitation-only event, in Rio de Janeiro, Brazil, demonstrated their understanding of the country’s skyrocketing revenue potential, especially in the women-led SMB market.  It’s a pretty great draw as conference destinations go, too. Last year, DWEN was held in Shanghai; next year (decided by online vote during this year’s event), DWEN goes to India.  See a trend?

2. Send your highest-level execs and make them accessible.

Nothing says, “we care about you and your business” like showing executive support for your customers.  Steve Felice, the highest-ranking SMB executive (who reports directly to Michael Dell), not only kicked off both days of the event but also made himself available by taking part in all the social events.  I was able not only to introduce myself, but to discuss a strategic, soon-to-be-announced project with him that Phone Works, my company, is doing for his division – a project that highlights their company’s support of cloud computing and Sales 2.0.  Other Dell heavy hitters, including Erik Dithmer, VP and General Manager of SMB Americas and Consumer Latin America, Kim Hibler, VP U.S. SMB Sales, and other senior executives were not only in the audience, but led panels and discussions.

3. Showcase your attendees – invite many to be speakers.

DWEN featured some well-known personalities. Moira Forbes, publisher of ForbesWoman, was invited to moderate and interview Arianna Huffington, who appeared via video conference…talk about Interview 2.0!  All other speakers were attendees like me: founders, CEOs, authors, investors, press and analysts from around the world.  I met women from Canada, Brazil, Australia, India, Japan and China, in addition to other Americans.  Of about 125 people, more than 25% of the attendees spoke on panels or were recruited to lead informal breakout and pool-side sessions held throughout the two days.  Dell recognized that we all have something valuable to share and, by participating, we were all engaged.

4. Deliver pertinent, actionable content.

In the panel on which I spoke, “Ahead of the Curve: How the Right Technology Strategy Can Promote Real Growth,” led by Kim Hibler, I emphasized that today’s customers demand relevant messages and content that can help them in their business. Lattice Engines, one of the conference sponsors, delivers this in spades.  Their sales intelligence software, salesPRISM, used by Dell’s sales team, helps reps identify the right Dell solution for each customer’s unique needs by providing dynamically updated, data-driven talking points that the salespeople can use to engage in relevant, timely discussions with their prospects and customers. salesPRISM has helped Dell increase sales productivity and drive higher sales growth.  You can read more about Dell SMB’s success with Lattice Engines here.

Other panels discussed funding options, using social media in business, and marketing to youth (“How Gen Y will rock your world: Seize upon their love of technology and their resistance to marketing.”)  Perhaps the best-received session, “Pitch Confidence,” was affectionately labeled the “Dolphin Tank.”  Entrepreneurs were invited to deliver a two-minute “sales pitch,” after which they received critiques from both investment experts and the audience.  Unlike the typical “shark tank” that many CEOs experience when presenting to VCs and other investors, a fundamental rule of this session was that feedback be presented in a constructive and supportive fashion.

5. Know your audience (without being sexist.)

DWEN is a conference for women and Dell embraces that.  And I’m not just talking about what goes into the goodie bag.  Dell set the tone for an atmosphere of trust and collaboration, discussion and participation that showed their understanding of women (and men who get Sales 2.0.)  They packed the program with the right topics, encouraged Q&A and interaction throughout the event by placing microphones at the audience tables.  (Ever met a woman who doesn’t like to talk?)  There were also nice touches that women appreciate: morning yoga on the beach, chocolate at the breaks (thanks to sponsor sweetriot – chocolate with a social conscience!)

6. Avoid the temptation to make the conference one giant commercial.

One of the most difficult principles in Sales 2.0 – and one I struggle with myself – is how to let your audience know what you have to offer, without turning them off by what may be perceived as a sales pitch.  Dell handled this beautifully at DWEN.  While Steve Felice mentioned Dell’s cloud computing initiatives and recent acquisitions (Boomi, which integrates applications, and SecureWorks for information security and threat protection), Dell’s offerings were not on the main stage. They had one small exhibit at one of the breaks, and put into practice one of Sales 2.0’s most compelling approaches of putting your product into your prospect’s hands to let them sell themselves. Dell gave away a Vostro laptop to every attendee, custom-skinned with a photo of Rio’s famed Carnival.

What has your business found to be successful in selling to the SMB market? How would you like to improve?

Tags: boomi, Dell, Dell Women’s Entrepreneur Network, DWEN, Lattice Engines, Phone Works, Sales 2.0, sales intelligence, sales intelligence software, salesPRISM, SecureWorks, small and medium-sized business, SMB, SMB Executives, sweetriot, Vostro