Buyers know that sales teams could be in any of a number of situations at quarter end — here are the more common ones:

1. Quota Short — need the deal to hit the number
2. Quota Long — need the deal to hit accelerated goal
3. Plan short — need deal to fund other territories short of quota
4. Strategic — Fund company strategic, growth or guidance objectives

Interestingly, in good and bad sales quarters alike there is almost no situation where sales doesn’t need the new business more today than it does tomorrow, and buyers definitely take advantage of that fact! Bear in mind though, that once the order is placed and the terms are agreed, there are a lot less options for the buyers to influence their vendor-partner’s behavior.

Is there anything that can counterbalance the buyer-leverage?  Probably not really.  In economic terms you are trying to create scarcity, which will drive demand and influence motivation.  Scarcity cannot be artificially achieved — especially in the case of software that has no inherent material limitations on production such as out of stock and back-order, etc…

Here are some “tricks” that are  often used to try to create scarcity; and I always cringe when I hear them suggested because they are NOT usually effective:

• Expiring discounts
• Threats of price increase
• Artificial limitations on availability

As a sales manager I’ve always discouraged these types of ploys.  What goes around comes around.  If you offer a reduced price and the deadline expires — either somebody has to loose face, or the deal is going to stall.  Legitimate price increases aside, these are never situations that leave both partiers feeling great.

But there are things that are very good to include in a sales process and often DO work to help drive demand in lieu of scarcity.   My favorites are:

• A  rock solid business case and ROI — well documented and socialized
• Buyer goal or deadline
• Trusted relationship based on business performance

Say for instance that your customer is a manufacturing company that has a new strategic initiative to get 100% of their material received by the close of business every day; and you are providing a new ERP module that automates the majority of that very process.  One good technique is to gain agreement on the GO LIVE DATE required for the initiative to best succeed.  First,  you can credit the penalties for NOT hitting the date as value on the ROI calculations .  Then count backward through any lead time and implementation required, and you will arrive at agreement on when the deal has to be signed to make sure that the deadline is met.  This type of exercise winds up being far more compelling than discounting because it’s in the BUYERS best interest.  The value of hitting the objective is almost always far, far greater than any discount you are willing to provide,  AND it protects the value of the solution against future discounting.

One of my Favorite manager-type  questions during quarterly territory reviews has always been:

• Why do anything?
• Why do it now?
• Why do it with us?

These questions will really flush out the quality of business case, the ROI, and the buyer’s intent and motivation.  If you’re gut says the answers are not good, or that you don’t really know the answers, then you may not get the deal –  even at the end of the quarter!   My experience has shown that if the response to this challenge is good — deals can, and often do close early in the quarter.

To get there, the first thing I need to do is drop back and take a look at what it means to be selling. What is “sales”, and what is selling? If you Google the word you will find an interesting Old English version: “sellan” which meant to “betray in exchange for money”. Ouch! The more contemporary definitions all center around verbs like: give, take and exchange. The root of the concept is the transaction — exchanging product or services for money. For many types of businesses — that’s it — no further discussion is necessary.

But not so for most technology business, especially complex software applications, and information technology solutions. To get to the transaction end of a complex product or services sale — a lot more has to happen. All of THE STUFF, from the finding of prospects that might be interested, to establishing meaningful communication, making a connection, demonstrating value, negotiating a deal, completing a delivery, and following up to make sure it’s working well — all of THAT STUFF is SALES. I can’t help but point out, though it should be obvious, that this process assumes effective marketing at the top of the funnel, and terrific customer support at the bottom where the customers are — but it’s still sales. More about that later — this post is about the middle part of the sales funnel — trying to build sales relationships effectively using sales 2.0.

Can high-powered sales professionals really be effective at this intensive connection and communication oriented challenge using Web-Ex or Go-To-Meeting, and never darken the door of the prospect’s office? Well — maybe. I’ve seen it happen many times. A key part of selling is communication and connection, so if this can be effectively established remotely — save the air-fare and the fossil fuels — I am a believer! OTOH — maybe not, or at least maybe not always. So my advice would be that it probably makes sense to build the sales organization with some degree of flexibility, and allow for focused, considerate, professionals to make the judgment call close to the action.

I have worked with many so called high-powered sales executives who actually warm to the idea of using a sales 2.0 based process to the extent that it saves them time and money and leverages getting more prospect coverage. Many of these folks work in SaaS companies and feel sales 2.0 matches up well with the need to be efficient, and they say that sometimes sales 2.0 is even better than face to face. For instance consider the situation where the buyer’s decision team is geographically dispersed — and this happens quite frequently these days — so the Account Executive and Solutions Consultant and maybe other members of the sales team need to present an in-depth solution overview and demo to the whole buy side team — where do they go to do that face to face? Likely as not they will get less than TWO of the critical decision makers in any ONE room.  And, they don’t want to make the mistake of playing favorite to the wrong people and run afoul of a bad politic. Because of situations like this, its tempting to believe the industry is changing and creating new types of sales professionals that embrace sales 2.0 in their professional and personal lifestyles — and match that up with similar changes on the buyer’s side of the table as well.

I’m starting to feel like it is more and more sensible to integrate the sales 2.0 process approach into relationship based, consultative selling organizations in the digital age — and since I have personally experienced it working well over a range of product types from complex hardware and software database solutions to enterprise SaaS applications, I’m also comfortable that sales 2.0 is more than hype — it’s simply hitting on a process change made possible by the new technologies we now have at hand.

Sales 2.0 makes a lot of sense — it uses the power of the internet for communication and flavors it with a spice of social networking that may help establish and deepen the connection with prospective buyers — and it has lots of benefits regarding cost, time and travel. Some important caveats are that it doesn’t work all the time, and like so many other facets of building an effective revenue generation function, it should be monitored and managed to get the best results. That said, having been a road warrior for many, many years, — I welcome the notion. We could even market it as “green selling”.

Prologue:  I published this post back in February of 09 — you may remember that’s when the economy was still completely falling apart and there was less oil in the Gulf of Mexico.  It was meant to be a treatise on the need for marketing simplification…based on what the new GM has done since then — I feel validated.  It may be too late for Saab, but the point is not lost.

Feb 20, 2009 –

I read today that Saab is now looking for a loan they probably won’t get, to buy their independence from their drowning GM parent.  Too bad, this is a real Saab story…….Saab was started in 1937 to build air planes for the Swedish Air force, and they quickly switched their attention to building cars.  If somewhat quirky, they’ve always been innovative.  Their first model was based on a light weight 2 Cycle engine.  They always knew how to squeeze a lot of performance out of a gallon of gasoline.

They introduced the three point seat belt, head rests, and the fold down rear seat, and equipped cars with four-wheel disc brakes, and fully independant suspensions, not to mention pioneering front wheel drive and trans-axle technology.  They  Aaways focused on occupant safety and performance, and always emphasized engineering.  My last Saab was a 9000 Aero — a great car.  I didnt buy another one only because I was not thrilled with the local dealer network.  But IMHO, this is the type of car GM should build as oppsed to the plastic trimmed, under performing death traps that haven’t had significant engineering effort applied to them since 1945.  After all, why replace six liter push rod gas guzzlers that make only 210 Hp with dual overhead cam turbo charged three liter 230 Hp engines that get twice the fuel economy or better — who would want that?

Mr. Wagoner, here is my reorganization plan for your (our) company:  Can all the car divisions, badge the new Saab line up with the Chevrolet logo, and build some trucks with reasonable diesel engines in them.  Then consumers can go to a Chevy dealer and buy a decent car, or truck depending on their needs.  You will save a ton on branding and advertising, and you can do something really novel that you havent done in decades… spend some money on engineering.  Save Saab — !

• What did you do to get them?
• Is your customer acquisition plan scalable?
• How long did it take to get them?
• How much did it cost to get them?
• What are you doing to keep them?
  

It may be painfully obvious, but the revenue cycle is pretty simple. First you have to attract and engage customers through marketing and sales which would then be followed by delivery and support. Do a good job, and you may be able to repeat the cycle — many times — depending on your type of product.

The Revenue Cycle

And, it may sound like no news at all, but in a tough economy it gets harder and harder for marketing to make headway in finding NEW customers while staying anywhere close to their budgets. The good news is that great customer service and support can be a gateway to preserving and growing revenue.  The bulk of this Blog is dedicated to content on marketing and selling in the digital -read on the internet – age.   It’s all about making marketing and sales relevant and effective in the web world, and it’s also about ways to make sure that service and support actually are the new “sales”– or at least part of it; and that customers, can be acquired, and retained, on their terms, in ways that add value for both buyer and seller alike– while still meeting cost and price expectations all the way around.  And…while I am at it, it would I’d like to have some fun, and maybe be a bit controversial from time to time too — Cheers, and thanks for checking out the Electric Funnel Blog.