Business Development

Key challenges for today's Entrepreneurs

2012-02-09T13:53:00.000+00:00

I was at Venturefest Yorkshire yesterday and sat in on a session discussing the key findings from a recent Entrepreneurs' Survey.

Whilst the findings of the survey weren't exactly ground-breaking (top challenges were "cash flow and funding" and the need to generate greater sales) the discussion surrounding the survey was really interesting.

On the funding front, the room was surveyed with a quick show of hand of who had previously pitched for VC funding. Only 3 people put there hands up and, of those 2 had successfully raised funds through VC.

This corresponds with the survey data that said 81% of Entrepreneurs self-financed their business and only 1% raised finance through angel investors. Considering the event was heavily sponsored by Yorkshire Business Angels Association, that's an amazing number.

With regard to revenue and growth opportunities an upbeat 75% of the survey expected to achieve or exceed projected revenue growth. Growth strategies that came out of the survey included developing new products, technology and innovation (8%) and expansion into export markets (8%).

That last number could be a reflection on the type of businesses surveyed but it doesn't look great for UK plc in terms of export, which was a point picked up by one of the panel, Lara Morgan (founder and ex-CEO of Pacific Direct).

An interesting comment for me (which relates to the above growth strategy of product development) came from panelist Ed French, Investment Director for Finance Yorkshire. Ed made a point that many mid-sized companies often have a "product in the cupboard" that they fail to invest in bringing to market. He felt that the UK should be more like the US in this respect where there are far more spin-outs from business.

Key skills shortages that Entrepreneurs felt they needed to address were primarily in finance and sales & marketing, which really comes back to the key challenges identified in the survey.

Overall, whilst the finding may not be a big surprise, the panellist debate was excellent and Venturefest put on another event that just keeps getting better.

Is LinkedIn rolling out social spam now?

2012-02-01T11:22:00.002+00:00

To all those idealist who thought that social media has heralded a new age of selling.

No more spam, no more push marketing... yeah, right.

Yesterday I received 2 messages from advertisers straight into my inbox on LinkedIn. One was from HP and the other from Microsoft (not sure why I got them since I'm not in IT, but whatever).

They appeared in my inbox alongside other network messages. When I clicked on the link I'm sent to micro site on LinkedIn. Right at the bottom it tells me:

Why did I receive this message? This partner message was sent to you based on non-personal information, such as the title of your current position, your primary industry, or your region. Per our privacy policy, your name and e-mail address have not been disclosed

And there's an option to change my contact settings.

No more today so far, let's see what happens.

Now LinkedIn usually tests things in the background before launching and, when they do, there's little fanfare or announcement, they just slip in it.

But it looks like they're trying the equivalent of "promoted tweet" ie: good old fashioned direct marketing.

Personally, if it's relevant I don't really care but in this case it wasn't. Possibly because I have the word "technology" on my profile but that's it. Hardly targeted with laser precision.

And, even though I use LinkedIn every day, these 2 ads made up 22% of my inbox messages yesterday. Hmmm, wonder how long it is before those contact setting get changed?

On a similar note, there's been a round-robin style message going around Linkedin about the fact they've changed their privacy settings and can now use images and details of you in their advertising campaigns.

While I'm dreaming of my 5 minutes of fame on prime time TV, others are up in arms spreading the word that you need to change your settings to stop this happening.

Ah, social media.... it's so social.

Re-thinking the B2B sales model

2012-01-05T16:17:00.002+00:00

Here's an interesting question to consider: "Where does the B2B sales model go from here?"

And, whilst I wonder whether the sales model example quoted in the article is really so different from other technology companies who sell through channel, it's still a good question to ask.

Without doubt, the traditional "sales force" has changed over the last 10 years.

The other day I dusted off an old classic book on the sales force written back in 2001 and was amazed how out of date it was.

No mention of e-commerce, inside sales, web-demos or conference calls.

No search. No social media.

It seemed as far removed from today as when I was a young gun laughing at the old sales pros talking about the 2p's they kept in their Ford Granada's so they could call the office from a phone box once a day.

But, back to the question: "Where do we go from here".

For companies that are looking to increase revenue growth it's always useful to break down their business model and understand where is can be improved.

If you have a traditional B2B "direct" sales model, you can look at different channels, such as e-commerce or inside sales to improve efficiency. Pushing repeat orders through these channels enables you to reduce expensive field sales resource.

In addition, re-thinking the sales process can reduce costs through using technology to increase the effectiveness of your sales team which, in turn, increases profitability.

As the article points out, you can also consider developing indirect channels to drive revenue.

Selling through partners, distributors and resellers are options that may be better suited to some of your products and services than others.

Sometimes it takes a new product/service proposition to open up revenue opportunities through different channels. An example would be a training provider that has a direct B2B sales model for it's in-house courses but now delivers e-learning solutions. The lower price point of e-learning may require a change in the sales model and could be more suited to an indirect sales channel.

The theme here is "change".

As the article points out, "the percentage of reps making quota has been stuck in the fifties (percentile range) for years" and the average Sales Director tenure is "as low as 19 months".

Either it's the people that are no good or something else needs to change to hit the numbers.

Sure, it could be a skills development issue. Or maybe improving the sales process. Or maybe the market's moved on and you're still trying the sell the way you always did.

Ah, wouldn't it be great if the worst problem you had in sales was where to find a phone box?

Is social media now just a blur?

2011-12-08T08:24:00.001+00:00

I don't know whether I'm just a grumpy 40-something or maybe I'm just having one of those "emperor's new clothes" moments but I'm starting to wonder about the direction of social media.

You see, like many others, I'm spending some of my time on twitter, LinkedIn groups, etc. I'm following people with similar interests, commenting on discussions, etc.

It's true, my involvement isn't full time since, like you, I'm also running my business and delivering projects for clients and trying to generate more revenue.

And, in my quest to find the next useful piece of information or discussion to tweet about and comment on all I'm seeing is more of the same.

LinkedIn discussions are often either the same questions asked in a different way or just a long running debate that's been added to over a 12 month period.

The latest "research" or report just seems to re-hash old statistics or spin someone else's report to create content.

After all, content is king and you need to feed the beast.

Plus, if you follow all the social media experts they'll keep telling you that this is the best way to convert business, drive sales, etc, etc... but very few give you concrete examples outside of a few huge brands or shoe-string niche consumer start-ups.

It's a bit like the myth that you lose 90% of your heat out your head. Totally debunked by scientists since the 80's but still everyone believes it. Maybe it's because it's got a statistic in it?

There are countless other examples where some study has been regurgitated over years to be held up as a truth that everyone just accepts. And I think there's a lot of that happening in social media.

Sometimes I get the feeling that on many LinkedIn groups (and to an extent on Twitter) there's this self-serving clique of people who simply retweet each other and start discussions just because they have to (it's in their social media plan).

I know... that's social media etiquette, of course. Which is maybe why I'm just being a grumpy middle aged man.

But, I think it's valid to question why you're doing something and also where it's going.

I read in a report (ironic, I know) that one hot area for new business ideas is in "filtering" social media content.

Wasn't that was social media was all about. Content gets filtered and recommended to you by people you trust?

But if everyone's playing the game of "must tweet 4 times a day" or "must produce an article every week" what's going to happen?

As I've posted about before, marketing does one thing really well - abuse a new channel until it gets saturated. Junk mail, cold calls, email, it's all been done before.

Even Twitter now has promoted tweets and accounts.

Well, it was fun while it lasted.

Sales Trends for 2012

2011-12-05T08:21:00.001+00:00

It's that time of the year where everyone starts predicting the sales trends for 2012.

The latest article to catch my eye, Barrett's The 12 Sales Trends of 2012, has the overall theme of "Adapt or Perish", which I think pretty much sums it up.

It's a lot like the theme I developed in this post last month.

Picking through the 12 sales trends covered most are part of the ongoing evolution (or should it be revolution) in sales that's been brought about by "search" and the internet. This has been the single most disruptive force in sales aver the last 10 years.

When I say disruptive, that's not a criticism, I'm talking in terms of how search has completely changing the B2B sales landscape.

It's what the article points to as "A seismic shift in the way we sell".

In the 21st century business is more about questions than answers; more about thinking than action; more about people than capital. 2012 is about getting your house in a new order because the world changes yet again and we need to change with it.

Transactional salespeople, or "order takers" have basically been replaced by ecommerce. Every aspect of sales has gone higher up the food chain, which is reflected in a number of the trends outlined including "the polarisation of buying and selling".

Your sales team today are no longer just "closers", they're facilitators.

Other trends look at improving efficiency of selling, through better CRM, targeting and segmentation and reducing expensive sales resources, such as "Field sales team numbers to halve".

It's now all about getting more from less, which is basically what every business needs to consider.

As the article concludes, "Buyers are in the driver’s seat"

So, who's doing "sales"?

2011-11-29T17:11:00.001+00:00

There was an amusing moment recently when I sat in on a board meeting at a young start up company.

After all the discussions around the business proposition and how to leverage a recent launch event it suddenly became clear to everyone around the table that they actually had to start selling.

There was a lot of looking around at each other and the room fell silent.

I could almost hear the tumble weed blowing across...

The truth is that for start-ups and any small business - everyone does "sales".

Where's the hidden revenue in your business?

2011-11-24T19:47:00.001+00:00

Although I didn't realise it at the time, I took my first "consulting" role over 10 years ago when I joined a company to turnaround declining revenues within their service division.

What I thought was simply a sales management role was actually a challenging change management project as I had to increase revenues through transforming the structure of both the team and the service proposition.

The first thing I did when I started was really dig into the figures to see what was happening. Whilst everyone I spoke with thought that the problem was simply down to poor sales performance, in fact it actually due to the fundamental structure of the division and it's service offering.

Without going into the details, the service division was structured in such a way that it's people were compensated contrary to increasing revenue. Plus, instead of working in conjunction with the capital equipment division (which had traditionally sold the equipment maintained by the service division) they had completely opposed sales structures leading to new equipment being sold that was actually serviced by another company at a cheaper price than their own service division.

Believe me, you could not make it up.

Once this was realised, the changes I put in place quickly reversed revenues which had been declining for over 5 years.

Over the next 3 years, in a company that was struggling and constantly striving for performance gains post-MBO, I found myself sat around the boardroom with the CEO looking at other "projects" to generate sales growth and revenue improvement. The common theme was that these were all projects which aimed to unlock hidden revenue within the business.

Handing them to the Sales Director or one of their team wouldn't work. Either they were too close to the issue or they simply couldn't afford to turn their attention from hitting sales targets. What the CEO needed was a business consultant. In a larger corporate it would have been a business analyst or someone in the CEO's strategy team. But this was a 250 employee SME... so it was me.

Often the projects ran across different divisions, and required a more holistic approach unencumbered by company politics.

Examples of where hidden revenue can be found within a business include:

cross division offerings - you can unlock significant revenue opportunities by combining service offerings from two autonomous business units. One company I worked with had separate consumable and equipment divisions who never combined their offerings because of internal structures, leaving money on the table which their competitors exploited.

cross territory sales - a common problem in companies with fixed sales territories is that they're often not aligned with customer decision making. I worked with a company that had no-one looking at national accounts. The sales team were focused on their own little area meaning that they never looked for the larger opportunities. Salesperson X could be dealing with a division of a national company with offices around the UK but since they "weren't on his patch" they were left untouched. Wouldn't the salesperson just tell their colleagues to follow up these opportunities? Not when they're competing with each other for the president's club and holiday to Hawaii!

It's true that the problems of silo's usually occur within larger businesses (both the examples and the original company I mentioned were companies with between 220-500 employees) but there are also examples of hidden revenue within smaller businesses, which include:

Failing to cross-sell to existing customers - do they buy every product or service that you offer? Have you ever walked into a customer and seen or heard about a competitor's product or service. Did they say "I didn't know you did that"?

Not exploiting all opportunities within existing accounts - do you know which customers are part of larger groups? Are you in contact with all potential buyers within the same account? For example, if you sell training services and you only deal with HR what happens if the Sales Director buys a training programme elsewhere? Are you sure you will always be asked? Most decisions in larger companies involve more than one person, often 4 or 5; are you in contact with all of them? Do you even know them all?

Not catching up with dormant accounts - if you're a project based business, are you keeping up with every account? If your contacts move on, are you following them, and are you in front of their replacement? This is a common problem for business owners who are focused on delivery and let accounts go cold. It's not your customer's responsibility to tell you; it's no good moaning that old so-and-so never called you - you need to call them (or at least get one of your business development team to give them a regular nudge).

Consider everything within you business as an asset. That's your people, your existing customers, your lapsed customers, your prospect database, your accounts history... everything. Ask yourself, are you really leveraging every asset in your business?

If you look a little deeper, and often with a fresh, outsider's perspective, you may find that significant revenue opportunities are right in front of you.

Does your business have an austerity plan for growth?

2011-11-10T09:26:00.003+00:00

As many business owners are thinking about their sales and marketing plans for 2012, I looked back at a post I made at this time 2 years ago (see Do you have a sustainable model to generate new business?) and wondered whether I should just re-post it.

Back then, looking at the tough market conditions facing service companies, I asked the question "Is this just a passing phase... or is this "business as usual" for the next few years?"

Anyone who's been watching the slow-mo train wreck of the Eurozone will surely now be thinking it's the latter.

Chatting with a client yesterday who runs a consulting firm, he summed the mood up by saying that it's going to take at least another 3 years before things get better.

Well, he is an optimist after all :-)

With analysts saying that Europe's facing a lost decade of growth you could be forgiven for thinking that it's all over, but let's not confuse macroeconomics with your own business.

You see, to me, even if there's no growth at a GDP level that doesn't mean there has to be no growth for your business. In fact, revenue growth for your business really has little to do with GDP growth and more to do with how you run your own sales and marketing efforts.

Sure, the current market conditions are tough for many but, and this is my point, you'd just better get used to it.

Back in 2008 when we were all thinking it would be a short sharp recession, cutting back and putting things on hold was a sensible approach. Then when it all bounces back you can put your foot back on the pedal, right?

But, for many business owners today, there is no more room to cut back. Cut back and you don't have a business anymore. In fact, do nothing and you won't have a business anymore.

You need to stake your claim and find a way to grow.

And I mean grow... not just survive.

Of course, you need to be realistic, which is why I say you need an austerity plan for growth.

Which may sound contradictory but what I mean is you need a plan to grow your business during these times of austerity. But there is still business out there. Sure, it's tougher to win and you need to do more for less, etc. Those things haven't changed, in fact they've just become baked in.

But, let me repeat, there's still business there.

And now's the time to find a way of winning it.

Beat your competition, innovate your marketing. Be creative, because it's at this time that the strongest businesses will grow.

As a final passing thought, here's 2 books I'd recommend reading at this time:

Fortune at the Bottom of the Pyramid and Blue Ocean Strategy

Re-thinking your business model, partnering with clients (and suppliers) in new, sustainable ways and re-shaping your proposition are all ways to see a huge potential for growth in the current crisis.

Outbound marketing is evil and useless

2011-10-31T14:05:00.002+00:00

Are you wondering about what tactics to use for lead generation?

According to this infographic from some clever marketing types called "Inbound Marketing vs Outbound Marketing" you should put all your money into inbound marketing.

Here's the reality check:

OK, let's put on one side the fact that this is developed by a digital agency with a heavy bias towards inbound marketing. And, let's not read too much into the fact that it's probbaly more specific to B2C rather than B2B.

And, hmmm, let's not criticise the fact that the inbound marketers are all smiles, lollipops and sunshine while the the poor outbound marketer is a pawn of Satan, losing money due to his outdated marketing tactics.

All that bias I can forgive as the usual spin on any statistics used to support an argument.

But, to me, there are a few glaring things wrong with this.

Firstly, the graphic conveniently ignores email marketing.

Because email's an outbound channel and a digital one, it doesn't really fit with the old guard/new guard story. Cost per lead for email campaigns are very low so how can you square that with the "outbound marketing costs more" theme.

I'd also question how you can refer to trade shows as "Outbound". To me it's the same dynamic as Inbound since, as far as I know, people aren't hauled off the street kicking and screaming to attend them.

So, omit a huge outbound marketing tactic that doesn't fit your theory and then simply assign the "highest cost per lead" tactic as Outbound just so that it helps support your argument.

I'd guess that if email was included then the correct graphic would be less polarised and a much more boring "horses for courses" picture would emerge.

Also, simply looking at cost per lead is a narrow view of things.

Conversion ratios, volume of leads and average sales value should always be looked at.

Let's take trade shows as an example.

According to these guys, trade shows... ooh, trade shows are bad. Really expensive cost per lead, you'd be mad to spend any money on them.

But if they give you access to the right level of decision maker, help you close larger deal values or generate a significant number of high quality leads then should you do them? Hell, yes!

Take the other extreme - blogs.

According to the infographic, 55% per companies who blog reported leads from this channel were "below average" in cost. I would challenge how many companies distinguish leads coming from their blog compared to SEO (or even PPC for that matter) - yes, I know that you can do this but I bet very few marketers really do know the numbers.

Anyway, apart from that, the crucial bit for me is what quality are the leads and how many can that tactic generate.

If the number of leads is less than you need (or too low in quality) to hit your revenue numbers then it doesn't matter how low cost they are. A trickle of cheap leads won't plug a big hole in your next quarter's sales target.

The truth is, "Inbound" marketing is just marketing. And whilst for one company trade shows may be a high-cost way of generating leads for another they may be the only way. Or maybe not.

If something doesn't make sense in terms of marketing ROI then it gets dropped.

But don't write it off forever.

DM has started to pick up in terms of high-value B2B campaigns.

Equally, social media may be the next best thing or maybe it'll reach saturation point too.

I know it doesn't make for a big headline or flashy graphics but lead generation is about getting the mix right for your business, trying out different things to see what works and then sticking with what works until it doesn't.

B2B lead generation survey on tactics and trends

2011-10-28T12:55:00.002+01:00

I was reading an interesting survey "B2B Marketing Budgets, Strategies, Tactics and Trends" (download a copy here) which looks at the changes in the marketing mix for companies.

The survey looks at tactics for both lead generation and brand awareness for B2B companies.

From a lead generation perspective, the top tactics in terms of effectiveness are:

1) Inside sales and telemarketing are considered the most effective tactic for lead generation (47.6% rated them "highly effective")

2) Trade shows and conferences are the next most effective (moving up to 2nd place from 3rd in the previous year's survey)

3) Executive breakfasts and events fell from 1st place to 3rd place in the survey.

Another thing that stood out to me is that marketers from large companies consistently rated inside sales and telemarketing as highly effective in generating leads whilst smaller companies are more likely to use lower-cost digital tactics for lead generation (search marketing, websites, podcasts) even though "these tactics are not among those they rate most effective"

Is it me or does that not make any sense?

Why use less effective tactics if they don't work as well?

Well, the more you dig into the report you realise that it's mainly an issue of budgets being squeezed and marketers trying to get more from less.

And, on top of that, it's these low-cost digital channels that are seeing the greatest increase in spend.

According to the report, the most widely used digital tactics are company websites (95.4%, which makes me wonder who are the 4.6% of B2B companies that don't have a website) and email marketing (87.7%).

Social networks and blogging continue to see increases in budget spend but also continue to rank lowly in terms of effectiveness for lead generation (they rank higher for "brand awareness")

So, how do you square those stats?

People are spending more money on marketing tactics that are less effective for lead generation compared with proven tactics that consistently deliver?

Has everyone just lost all business sense or is there a different story under the headline figures.

Crucially, it comes down to budget.

Some of the most effective marketing tactics require a larger investment. Trade shows are not cheap. Running a high-touch telemarketing campaign over several months also requires considerable investment.

Sending out 1000 emails however is very low cost. Whether it delivers the number and quality of leads needed to keep your pipeline full is a different story.

Looking at budget size the survey shows that smaller companies have smaller budgets (duh?) and that companies that only sell B2B with a direct sales model (ie: their own salespeople rather than through resellers and channel partners) have the smallest budgets of all.

Even more of a reason not to waste money on in-effective tactics, I say.

Which is why we always work with clients on fee models that are part fixed and part paid on delivering results. For our fixed fees we do things including telemarketing, email marketing, event/trade-show support, etc (basically stuff that we know "works") and then we link the balance of our fees to results, such as a % of revenue generated.

It's a model that works for our clients and, we believe, ensures that we don't waste our time (or your money) doing stuff that isn't linked to tangible revenue growth.

Lead Quality is a priority for B2B companies, Duh?

2011-09-26T09:03:00.003+01:00

In a recent report by B2B Marketing Today, respondents said their two top priorities for lead generation were "Reaching the right decision makers" (46%) and "Improving lead quality" (43%).

When I read those statistics in The New Formula for Generating High Quality Leads in 2011, I just thought, "Duh?"

And whilst there's some interesting stuff in the white paper, the shock headline that improving lead quality is about "Quality over Quantity" just made me wonder why that was such a revelation?

Maybe it's because it's something that I've been banging on about for such a long time (see my post from 12 months ago as an example, Lead generation is the engine... sales is where the rubber meets the road) that I find it so surprising that this should be anything other than obvious.

After all, targeting and qualification are not exactly anything new in terms of lead generation.

The reality is that B2B marketing has been focused on the growth of online and it's ability to produce tons of leads at a lower cost-per-lead than more traditional channels.

And, if you think that this is something that been building over the last 3-4 years in B2B channels, then it's not surprising that the emphasis has been on getting systems set-up, generating traffic and getting leads.

But there's definitely been a trend over the last 12 months or so to focus on lead scoring, lead quality, etc.

I suspect that fingers are now being pointed at most marketing departments. And, if quality is on the agenda then sales are doing the pointing.

Lead quality and qualification sits between marketing and sales. It's the interface where leads are handed over (and handed back).

Once you've been through the loop of generating leads, qualifying them and tracking through to conversion you always start looking at lead quality. Which inevitably comes down to targeting, qualification and timing.

And one thing is for sure, when you do this the quantity of leads will always significantly decrease.

Lead generation for SME's

2011-07-06T12:05:00.003+01:00

In a recent report on SME Marketing Channel Preferences, Circle Research looked at SME's ranging from one-man-bands through to larger SME's (50-249 employees) to determine which marketing channels they rated as their preference for being effective in reaching them.

These findings can be useful when deciding on lead generation tactics to engage this market.

A word of warning, though, the preferences of your prospect doesn't always mean that it's the most effective channel in terms of ROI, but it can be a good indication.

A couple of key findings for me, and ones that correlate with our direct experience running campaigns into this sector, are:

Telemarketing is not ideal for smaller SME's - I think it's a combination of over use, time-poor decision makers and high number of gatekeepers (everyone in a small business treats the boss as god, in fact, you've more chance of pitching the almighty that the MD of a small business).

When you combine the difficulty of getting the message through with typical lower sales values (because smaller companies have smaller budgets) it makes targeting SME's with telemarketing almost unworkable. I say almost because, if you've got some clout (ie: calling with some authority and a highly targeted relevant proposition) then it can work.

The research also indicates that telemarketing becomes more effective for the larger SME's. This is typically because you're pitching a functional decision maker so can be more targeted and relevant. Plus, the potential sales value goes up, making a positive ROI more likely.

Prioritise Digital Channels - search and email are both proven and preferred channels for engaging SME's. In terms of outreach, we've used email effectively for SME lead generation campaigns. Also, an integrated telemarketing and email campaign can be even more effective in this market.

Search should be a no-brainer channel but, in our experience, it's not always the holy grail in terms of ROI. For many B2B companies selling services, keywords can be too broad and, in terms of PPC, too expensive to deliver a compelling ROI.

In summary, if you need to target smaller SME's then ignore stand-alone telemarketing and prioritise digital channels or integrate telemarketing with an email campaign.

For medium to large SME's (and even more so with mid-sector and large companies) then telemarketing still remains and effective channel but, as always, make sure any lead generation campaign is both targeted and relevant to get maximum ROI for your budget.

Are sales people really dying out there?

2011-05-27T11:41:00.003+01:00

It seems to me that there's a trend in articles which start with suggesting the old order is dead.

I've seen all the "Is cold-calling dead?" and "Is direct marketing dead?" ones over the last few years as everyone promoting online and social media marketing will tell you that the old nasty world of push marketing has been replaced by a new cosy opt-in world chocked full of engaging content and social interaction.

(In fact, the "cold-calling is dead" one has been doing the rounds for as long as I can remember, the first time I saw it it was pushing face-to-face networking as the solution to all your problems.)

Anyway, let's leave that argument on one side and look at a new variation on the theme, "Salesmen are Dying and Other IT Trends".

The article is focused primarily on IT B2B buyers so it doesn't necessarily equate to all sales and, in particular, service based propositions. But the fundamentals are that Internet-enabled buyers only engage with a vendor's salespeople towards the end of the process, which means that salespeople have less time to build relationships and influence decisions.

In B2B sales, the buying/sales process is more complex that B2C transactions. B2B sales is driven by multiple stakeholders and decision makers, and carries more risk. Also, with more complex/technical solutions there's a greater reliance on vendors to help with scoping the solution.

So, are sales people dying?

Certainly, the more commoditised the product the more it will move towards online transactions.

I was chatting with a client the other day who used to work for the UK's largest distributor of safety products. 10 years ago they used to have a huge branch network and hundreds of reps on the road. Now it's nearly all telesales and online ordering.

Maybe another 5 years and the telesales will be a fraction of what it is now and most will be online.

Also, the shift towards buyers researching online means that there's a reduced need for sales to engage early in the sales cycle. When I ran a field sales team we'd get the leads from head office (usually a response card from a magazine or lead from a trade show) and the local rep would make an appointment to sit down, provide the prospect with brochures, etc and qualify the lead.

Now buyers can get the information they want before they have to engage with sales. Which means less sales people are needed.

Less head count for sales means that each sales person is focused on deals that are more advanced in the buyer/sales process. Being more efficient and effective with limited resource is the name of the game, hence the rise in sales support teams, web-demos, etc.

Where is this all going?

To me, the trend in B2B sales is that the classic "sales rep" is heading for extinction. Poorly trained road warriors will be a thing of the past as buyers today don't need to waste their time with them just to find out early stage information.

The lead qualification piece has shifted internally to telesales or inside sales support.

Beyond that, there is a need for B2B sales people who bring real value during the more advance stages of the buying/sales process.

Refining scope, assisting in vendor selection decisions, support prospects with building business cases, and, ultimately, supporting with implementation and hand-over, these are the areas where sales now have to focus.

B2B sales people aren't dying, the smart ones are already adapting.

But, I agree that the dinosaurs will become extinct.

Voicemail - love it or hate it?

2011-05-17T15:03:00.009+01:00

Voicemail is an inevitable part of cold calling.

In the US it's got to ridiculous levels of 80% - 90% of calls ending in voicemail (after you've worked your way through the labyrinth of dial-by-name options).

Fortunately, in the UK, it's still less than 50% for most campaigns.

Of course, it's highly dependent on the level of decision maker you are calling. Generally, when you are at board level you are dealing with PA's rather than voicemail, which needs a completely different strategy.

But, at 50% of all calls ending in voicemail you'd think that telesales was pretty much impossible, right?

Well, it all depends on your outlook.

You can either take the old-school sales view which is to "never leave a message", in which case it's a waste of time.

Or, you can learn to love the voicemail and find a way of using it to your advantage.

When we run a lead generation campaign for a client we always have a strategy for dealing with voicemail. From the message that we leave through to how we integrate it with other contact channels (such as emails) our view is that each call that ends in a voicemail is an opportunity to make contact.

Now, of course, we're not talking about leaving a message and expecting them to call you back. Sure, there are some "tricks" that you can use to get people to phone you back. And depending on the campaign you might want to use these. But they all come with a health warning and potential for blowback.

For me, this approach is more likely to burn a contact.

It's better to use the voicemail as a bridge to your next contact (which could be an email) rather than to see it as a one time deal to get them to call you back.

Our approach is about leaving a brief message that positions your business and why we're calling them, tell them what we're doing next (ie: sending an email, calling back tomorrow, etc) and then follow through and do it. Sure, leave a number for them to call, but be clear about what you're doing next.

Why do we do this?

Firstly, we're using the voicemail as a "touch". Everyone in sales and marketing knows that to some degree it's a numbers game. You need so many touches before you get anywhere. So let's get one in now.

It takes us less than 30 seconds to leave a voicemail and ping a pre-prepared email.

If we make 100 calls a day and 40 are voicemail that's 40 extra touches we've had compared with someone from the "never leave a voicemail" camp. They do add up.

Also, we're looking to bridge from a completely unexpected cold call to something a little warmer. Why? Because half the battle of a cold call is to get over the knee-jerk reaction that people hate cold calls.

This second point divides a lot of sales people. Many still want to launch a surprise attack as they think the prospect will be defenceless to their superior sales skills. In my experience, hitting them completely cold guarantees that their defences will be up.

Why do so many companies send out a sales letter before a cold call? To warm them up. Well, think of voicemail as your opportunity to communicate one-to-one with the prospect before you call them.

Everyone checks their voicemails.

So, think of voicemail as an opportunity to improve strike rate and engage with your target market. Done correctly it can significantly improve the ROI of your telesales campaign.

How to use twitter for lead generation. Hopefully.

2011-05-11T13:12:00.005+01:00

Another email lands in my inbox from B2B Marketing promising to show me How to use Twitter to generate and nurture leads.

At last, I think, rubbing my hands, someone's finally cracked it and can show me how to actually generate real leads from Twitter.

Unfortunately, it's much more of a list of "best practice" which really only means "what everyone else is doing".

What really made me laugh was point 9) "Make a Sale", which says:

At this stage, hopefully your target has followed you back, accessed lots of valuable information via your Tweets, answered a few questions in return and as a result built up an ongoing relationship with your brand. They are now better informed and in regular contact with you – when you pass on their details to the sales team they should be in a great position to buy.

Call me a salty old sales cynic but as soon as I read "hopefully" I knew we were in trouble.

To me, that one word "hopefully" sums up the strategy of using twitter for lead generation.

Of course, I tweet myself occasionally, and have implemented most of the points covered in the article. And I'd agree that there's a large slice of "hopefully" in my strategy for doing so.

Does it take much of my time? No.

Could it potentially generate some leads? Hopefully, some day.

Would I forget about other tried and tested (but less sexy) lead generation tactics? No way!

Twitter is still new and, sure, people are still trying to work out what it's good for in terms of the B2B marketing mix. Unfortunately, I think that there are a lot of people who are making money out of telling people how to generate leads from Twitter when they really don't know themselves.

Earlier today I was chatting with a marketing consultant who was telling me that she tweeted on behalf of clients and helped them set up and manage their Twitter accounts. She was telling me how long it took to do it all and, sure, it sounded like a nice little earner.

But, when I asked her how much business it has generated for her clients it all went very quiet.

Has telemarketing really been wiped off the B2B landscape?

2011-03-21T14:18:00.004+00:00

If you read the IDM's latest Barometer Report you've be forgiven for thinking that telemarketing had been dropped completely as a B2B marketing tactic.

Going through the 30-page report there's not one mention of telemarketing, a proven corner-stone tactic for every b2b marketing organisation.

Why the omission? Has it really been dropped completely or is this just another example of telemarketing being B2B's Dirty Little Secret.

Considering the report cites "lead generation" as the top issue (25% of respondents) for B2B client-side marketers it seems unbelievable that telemarketing isn't mentioned.

No doubt it's just been lumped in with other direct marketing tactics.

Of the agencies involved in the report a whopping 59% were either described as "integrated marketing" or "direct marketing". Hmmm, you're not telling me that they've completely chopped telemarketing out of their service mix are you?

To me, this is another example of how telemarketing just doesn't cut it with the B2B media.

Sure, it's not sexy and it doesn't win awards. But, as proven tactic to reach targeted prospects it still remains a key part of any B2B marketer's plan.

Is twitter the next big thing for b2b lead generation?

2011-03-16T13:29:00.005+00:00

I suppose it was only a matter of time.

I noticed today a Twitter Sales Lead Tool which searches tweets for keywords relative to your business. It seems to filter tweets based on intent words (such as "need" or "looking for") and then delivers you a list of sales-ready leads which you can communicate directly with via the tool.

All very neat stuff.

It's something you can already do manually with a search string or advance search form and then saving the search. But, the search tool is free and looks to make organising the results easier so maybe it's worth a punt.

However, my real question is whether you really can get sales ready leads off twitter.

You see, as I've posted before Are social networks just a waste of time for B2B lead generation?, I wonder whether they really generate qualified sales leads or just a lot of time wasting noise.

Let's take our business as an example.

I'm looking for prospects who want telemarketing, right? (Well, not exactly, but lets follow this route). If I run a search on twitter for "telemarketing" I get a whole mixed bag a people complaining about telemarketing, looking for a telemarketing job, people looking for hire someone for a telemarketing job, it goes on.

OK, so I filter it by using a search string to remove the word "job" and to only look for people asking a question. What do I get? Well, in this instance, just one tweet and it's someone looking to hire someone.

But let's assume I actually get more. What next?

Well, for it to a qualified "sales-ready" lead I need to tick a few boxes. Basic stuff like budget, target market, timescales, etc. Whatever the filters are that you need to decide whether it's a qualified lead.

My point is that, when you really drill into these things, for b2b lead generation twitter doesn't seem to deliver. Of course, if you're selling something that has less qualification criteria and/or a large universe of people looking, then it could be a goldmine.

But for my business (and for pretty much all of my clients) I don't think so.

The more I look, the more I see that most of the buzz comes from people selling training or tools to use social media for lead generation. Everyone's jumped on the Sales 2.0 bandwagon and are making hay.

Don't get me wrong, social networking platforms can be useful for sales lead generation. Identifying and researching prospects are two key areas where we use them every day.

And, I don't rule out that as they develop and adoption grows within business, we won't find serious buyers tweeting their intent or starting discussions on LinkedIn groups whereas they used to wander around an exhibition hall looking for solutions.

But right now, for b2b sales lead generation, I think you're still better off investing your time, money and energy in more proven tactics.

Bottom line is that we're interested in delivering results. Whilst it might be sexy to talk with clients about social media the reality is that we can't guarantee it'll deliver qualified sales-ready opportunities.

Is Cold Calling dead? Surprising results from a LinkedIn Poll.

2011-03-08T15:26:00.006+00:00

Just when you thought the hype around social media couldn't get any bigger, there's seems to be a revived interest in that old-school approach - the cold call.

If you look at this poll on LinkedIn, Is Cold calling Dead, you'll see (at the time of this blog) that 64% of 352 respondents answered "No (Have No Plans to Change)".

Only 6% have moved totally to social media and a further 14% say Yes, they have stopped or will stop soon. The rest are somewhat on the shelf.

Even more interesting than that are the comments.

One after another, business owners, sales people and business development executives are confirming that cold calling is still alive and kicking.

You won't see that said in much of the B2B marketing media.

Also, people are confirming that they use social media to enhance their cold calling.

Whilst picking up that phone may be old school the approach has changed. Researching targets online before engaging (something that we always recommend) leads to a more intelligent approach and, ultimately, higher conversion rates.

If you read between the lines in the comments you'll find that many of those people who think it is dead are probably justifying the fact that they hate cold calling. Or they're selling "social media" as the new magic bullet.

Truth is, cold calling still works, but it needs a more intelligent approach.

Which is where we come in, I guess.

Why most telemarketing agencies lie to you about the results they'll deliver

2011-02-15T13:41:00.004+00:00

There's a recurring theme I keep seeing that actually makes me wonder why I bother.

You see, I come across lots of business owners who have tried telemarketing agencies before and found that they just didn't deliver what they promised.

They tell me something like "we were promised we'd get 2 appointments per day and we only got 1" or "they said that they'd get us senior appointments but we always seemed to end up in front of someone too junior".

You may even have experienced something similar to this yourself.

And, behind this, you'll find plenty of telemarketing agencies (large and small) who are constantly churning clients and have to replace them with new ones.

So, there's this ever increasing spiral of clients looking for more than is delivered (either because they had their fingers burned previously or simply have unrealistic expectations) and telemarketing agencies who are willing to promise the earth as they need to plug a gap of lost clients because they haven't been able to deliver what they promised.

This dynamic is driven by a highly competitive and fragmented market and also by clients looking to get more for less from their marketing budget.

It's all a bit "chicken and the egg" and, in then end, no one wins.

Now, maybe I'm wrong, but I just don't see the point of playing that game.

Here's the reality check: no-one really knows what results you'll get until they try.

This is true of any marketing spend, even "results-based" models such as pay-per-click (which only guarantee "clicks" not sales). Even if a telemarketing agency has worked with a similar sector before, targeting similar prospects it's just that - similar. Even the timing of a telemarketing campaign can vary results so let's stop pretending that anyone really knows what results you'll get.

The only way to find out is to run a pilot that's big enough to get traction but small enough to mitigate the costs of it not working.

Also, let's start being a bit more "grown-up" about results.

Any telemarketer worth their salt should be able to come up with a realistic return for a given investment. Some may be overly optimistic, some much more cautious, but ultimately their predictions shouldn't be miles apart. Given the parameters of any campaign, most experienced telemarketers will agree on the type of results they can deliver.

I've always worked in sales roles where you had to build long term relationships. If anything, I lean towards to conservative end of the spectrum. Why? Well, mainly because I believe in delivering on promises. Plus, I know that if we do deliver, we are more likely to build a longer term, sustainable relationship with our clients.

However, if I was an account manager for a telemarketing agency only interested in winning the next client to keep "bums on seats" then wouldn't I be motivated to inflate expectations to win the gig.

Which will only result in more client churn and more business owners who've had their fingers burned.

Personally, I'd rather set realistic expectations and not win the work. There's a significant investment of time on both sides to set up a campaign and get it under way so why bother unless both parties believe it's the start of a profitable, long term relationship.

I'd like to think that the telemarketing agencies that take the short-term view will eventually drop out of the market but, unfortunately, I doubt that will happen.

More likely they'll just continue to muddy the water for everyone else.

Are social networks just a waste of time for B2B lead generation?

2011-01-28T08:32:00.004+00:00

If you believe the hype, social networks are the place to be for lead generation.

Read up on a few "case studies" of people in this space (usually LinkedIn "experts") and they'll tell you that cold calling is dead and in the future you'll get all your leads from twitter or social networks.

Hmmm...

Sounds a bit like what everyone was punting on ecademy several years back before it just got full of spam.

Anyway, what prompted me to post this is that I'm a member of a lot of groups on LinkedIn and I've noticed a bit of a trend.

Firstly, someone posts a discussion saying "I'm looking for lead generation".

Next you get hundreds of comments from vendors saying "we do X, we'd love to speak with you".

There's one running on one group like this that has 298 comments!

Now, firstly, the initial post rarely has any detail or level of qualification.

Lead generation? Are you talking about online, email, telemarketing? B2B, B2C? How about budget? Basic qualification information really.

If someone rang me and asked for "lead generation" I'd need to know a lot more before I knew whether it was something I could help them with.

On top of that there are hundreds of people responding to this "enquiry" on the forum.

Put aside the fact that this means you're potentially up against hundreds of competitors, the question I'm asking is "who's in this group?".

Apparently, it's loads of people like you trying to find leads!

Anyone who has been to a real world "networking" event will know that most of the people there are only interested in selling you something.

Now, that's not to say that there are some quality groups on social networking sites, just as in the real world. But, realistically, there's a lot of rubbish out there.

All the "popular" groups on LinkedIn have 1000's of people posting so much stuff that it just overwhelms you. If you posted a discussion on these groups it'll be swept off the front page in minutes.

You see, as I've posted here many times before, the thing with anything online is that it gets to a saturation point very quickly.

Maybe I'll post a discussion about what ROI anyone has had from these groups and see how many responses I get to that.

What's wrong with most telemarketing agencies?

2010-12-07T10:19:00.007+00:00

I was chatting with a client the other day and they told me something that hadn't occurred to me previously.

They said that one of the things they liked about us is that we're not based in London.

Why? Because they found that london-based telemarketing agencies have trouble retaining telemarketers as their people are more transient in nature, only taking the job for a while before moving on.

And that does make sense, because when you think about many of the large call-centre or volume telemarketing agencies are located in areas outside London, usually lured there by local grants to boost employment.

But, beyond that, what does it really say about telemarketing agencies?

It says that most people will only work in one either if there is no alternative or they are "between" jobs.

Someone, who used to be a "team leader" in such an agency in a previous life, once told me how they used to literally drag people off the streets to put "bums on seats" and then bank on a few of their top performers to bring up the average and rescue the campaign.

So, why is this? What's wrong with most telemarketing agencies?

Typically, it boils down to a few inter-related areas:

1) Retention or "churn" - call-centres and volume telemarketing agencies have the highest turnover of staff than pretty much any other industry. Why? It's simple: they are terrible places to work and not everyone is suited to telemarketing.

Now, I'm not sure whether this is a "chicken or egg" issue, since if they were better places to work would they have less churn? But the fact is that the volume telemarketing game is a soul-sapping experience. This means that they have to recruit more just to keep the numbers up (since their business model is essentially selling resource) which in turn causes the quality to drop (as outbound telemarketing isn't for everyone) and so on, and so on.

Which brings us to the second issue:

2) High-cost base - all that constant recruitment, training and management costs is expensive. Add to that the technology overhead to record and monitor everyone and you can understand why telemarketing agencies run on wafer-thin profit margins. On top of that consider that telemarketing is a mature, highly competitive and price driven market and what's going to happen?

Margins get squeezed and with all that fixed overhead can they really afford to pay to retain the best talent? Which leads to...

3) Talent Drain - what happens to the best telemarketers? Do they become managers? Well, there's only so many management roles available and, realistically, the best telemarketers don't want to be a "manager". In our team we have people who have been there, done that and never want to go back. Great telemarketers (believe it or not) like telemarketing.

Do you pay them more? Maybe you can make them a "team leader" and pay a little more but there's only so much margin in this game. All that overhead, recruitment costs, management costs and the fancy BMW's parked outside for the account managers soon rack up.

So, what happens is that they leave and go freelance. As a freelancer they can be selective about the work they do and, if they team up with an associate model like ours, they can get a steady flow of quality assignments without the hassle of dealing with other telemarketers, account management, etc.

More money, less hassle.

And the traditional telemarketing agency has to replace them, which brings us right back to the first point, "churn".

For me, the model is broken and it's why I didn't set up a traditional telemarketing agency.

We work exclusively with seasoned telemarketers of the calibre most telemarketing agencies would kill for. We provide them with a steady level of high-quality, ongoing work which they would struggle to secure as a stand-alone freelancer.

The value we deliver for our clients is through offering strategic input and ongoing campaign management without the overhead of a traditional agency.

Essentially, our model provides a higher level of resource and service for less cost than a traditional telemarketing agency.

Think of it like this. The only way a traditional telemarketing agency (by which I mean a bricks-and-mortar location, technology overheads, account management teams, etc) can charge lower fees than our model is if they pay their people less.

And you know what they say about paying peanuts...

How much does telemarketing cost?

2010-11-22T17:08:00.010+00:00

One of the first things that anyone considering telemarketing wants to know is "how much does telemarketing cost?" or "what is your pricing for telemarketing services?".

Of course, many telemarketing companies answer this question by just quoting a daily rate, or you can look at the many services online that will take your details and then sell them on to 4 or 5 hungry telemarketing companies who will pester you for days to give you a quote when all you really want to know is "how much is a telemarketing campaign going to cost me?"

If you could just get a sensible, grown-up answer to that question you could decide whether it's worth considering further.

So, we thought we'd take a different approach and actually try to answer that question in a way that not only makes sense but actually provides you with an idea of return-on-investment (ROI).

You see, telemarketing costs are only part of the picture.

What you really need to consider is "what can a telemarketing campaign deliver in terms of revenue".

Now, the answer to that depends on a number of different variables, ranging from your target market and the brand equity you have within it, through to how many sales you can convert from meetings and what is your average revenue per sale.

Lots of things to consider, eh?

So, to help you, we've developed a simple telemarketing budget calculator in Microsoft Excel.

Once you open the excel sheet, all you need to do is select a number of variables, such as "What size of business you are targeting?", "What is your approximate budget?" and "What is your average revenue per sales value?" and the calculator will tell you what ROI you should expect for a given telemarketing budget.

You can adjust the budget (as well as the other variables) to change the ROI.

Is it perfect? Does it work for any telemarketing scenario?

No.

It's based on our experience working with business-to-business product and services companies who are targeting new business.

Generally, new business is as tough as it gets for telemarketing. If you want someone to call existing or lapsed customers then you can expect a higher return than our calculator will produce.

Also, most of our clients are not well-known brands. We have worked with a few big names and I can tell you that is makes telemarketing so much easier. So, again, if you're Microsoft, Accenture or IBM, you'll certainly out-perform our calculator in terms of ROI.

However, if you're looking to use telemarketing to generate new business in a competitive but targeted market then our model will be accurate enough for a sense-check on budget.

Also, in some circumstances the calculator shows a negative ROI.

Well, guess what... telemarketing probably isn't for you.

For most companies with a medium to high-value business-to-business sales proposition telemarketing still remains one of the most predictable and consistent methods of opening doors and generating new business.

Why not download our Telemarketing Budget Calculator and see if telemarketing could work for your business?

Don't track and attack!

2010-10-14T08:02:00.003+01:00

I usually collect phases from episodes of The Simpsons, so it was great to hear my latest favourite on a Demand Gen Report webinar "5 Baby Steps to Lead Nurturing Success".

Referring to today's various marketing automation tools to track visitors, score their activities based on what they're doing online and then send leads to your hungry pool of inside sales people, one of the speakers came out with the phrase:

"Observe and Serve, don't Track and Attack"

Unsurprisingly, prospects get a little freaked out when they click on a link for a whitepaper and get a heavy breathing salesperson calling them within seconds.

I experienced this first hand a few weeks ago when I followed a company on Twitter (they run networking events for Directors within specific business functions) and within a minute the phone rings and some sales guy is trying to sell me a ticket to his latest event.

Now, in some cases this may work but, on other cases you are more likely to scare the day-lights out of them and send them running to the hills. Is that really the start of a long-lasting relationship?

Particularly when it comes to higher-value business-to-business (B2B) marketing, you need to react quickly but, let's be honest, decision making cycles are much longer than with consumers.

In the instance I gave as an example, it would have been better if they guy had called me within 24-48 hours. This would have been quick enough to be seen as responsive (bearing in mind I wasn't filling out a contact form, simply following the company on Twitter).

In addition, if he had waited just a few more nanoseconds to really read my website (which is where he got my contact details from) he would have realised that I wasn't his core market. At best, as I explained, I could have referred some clients to his company.

Just pausing to think about why I would be interested, and then leaving a little breathing space before calling me, would have made for a completely different experience.

And that's from someone who doesn't mind being called by a salesperson!

No budget and still a lead ... I nearly FAINTed

2010-10-08T09:59:00.003+01:00

Another day, another acronym for qualified leads, eh?

This time it's the guys at RainToday, in their post No Budget, No Problem: The New Definition of a Qualified Sale.

They have come up with FAINT, which stands for:

Funds, Authority, Interest, Need, Timing.

It's a variation of BANT but, as you'll read in their article, they propose that asking about Budget kills a lead which could still be a genuine sales opportunity.

They have a valid point regarding asking about Budget but, in the end, I think it's the difference between qualification for leads and for sales opportunities.

You see, budgets are set for known categories of product and services. Plus budgets are the domain of mid-level managers. If you're in that game, understanding whether there's a budget in place can be useful and saves a lot of wasted time.

However, if you've got a new proposition for something that they don't already buy, or something that they have covered in a different way then it's no use talking about budget related to your specific offering.

In most situations like this, prospects will need to build a business case to invest in your solution. They need to find budget. If they want it enough and are senior enough - they will get the money.

"Authority" is a better way to qualify in this instance, backed up with some questions around their particular circumstances to uncover a real "Need".

From a lead generation perspective, Budget and Money are both areas that are best qualified more deeply as part of the sales process, which is when you're actually sat in front of them.

Is email the preferred channel for new business prospecting?

2010-09-30T07:15:00.003+01:00

According to TACK's Buyers Survey 2010, "Email now dominates as an acceptable channel for salespeople to make contact to arrange a first appointment with 84% saying email is acceptable, followed by a telephone call and then by letter."

The 2010 survey reports on the views of buyers from FTSE 100 companies to SMEs within manufacturing, retail, B2B, financial services and business services sectors across Europe, Asia and the US.

Remember that this survey looks at buyer's "preferences", which doesn't necessarily mean "effectiveness" of the channel to generate appointments.

This seems to run counter-intuitive to B2B marketing's perception of email for new business prospecting. With the increase in SPAM you'd expect email to be declining as a channel.

Again, let's not confuse effectiveness with buyer's preference.

It may well be that buyers prefer an approach via email since it's easier to reject or ignore than having something breathing down the phone at you.

Also, we shouldn't confuse a hand-crafted email specific to a person with bulk B2B email.

The latter is certainly viewed as SPAM and has increasing low pull rates for new customer acquisition. The former, we find, can be very effective at securing appointments without ever speaking with the prospect.

From a trend perspective it looks like, as well as email, telephone is marginally up on previous surveys, as is snail mail (we are seeing a lot of prospects requesting info by post, and generally direct mail is having a resurgence in B2B circles).

Fax is down (shock news!) and amazingly face-to-face cold calling is up.

Finally, LinkedIn has made an appearance as a preferred channel. Let's see how long it takes before that gets wrecked.

Judging but the amount of consultants selling "Sales 2.0: get sales leads through LinkedIn" as the new magic bullet, I'd say not long.