Ken Krogue

If you’ve read my “15 Time-wasters of Inside Sales and Marketing,” you’ve heard me say that one of the biggest culprits of poor sales performance and poor motivation is having a bad sales manager.

And if you’ve read my “15 Time Wasters,” you’ve also heard me say that regardless of where they come from or how they’re “wired,” all good sales managers share one, common trait:

They’re “scrappy.”

“Scrappy” is one of the terms that’s hard to define. Inherently we “get” the general concept, but it’s not easy to put it into words.

When we think of “scrappy” in the sports world, we think of the “blue collar” athlete, the guy or gal who wasn’t necessarily the most gifted player on the field, but who works at it the most, studies the most, prepares the most. Does the little things that other players aren’t willing to do to get an edge.

The one who digs down and finds something that the other players don’t have.

Larry Bird was the epitome of “scrappy.”

In the world of sales, the concept doesn’t change. Scrappy means being persistent, almost tenacious, but not in a forced, overly aggressive way. Scrappy is internal motivation. It’s building your own skills and talents, not tearing others down to get them out of the way.

Scrappy doesn’t mean putting blinders on. It’s working hard with your eyes open, constantly looking for ways to improve. Scrappy sales managers expect to get results, but aren’t blind to conditions. If something needs to change to have success, they find the solution. Scrappy sales managers feel for their charges. If a rep isn’t meeting quota, they take it personally.

Scrappy managers are willing to innovate. They’re willing to train and be trained.

Scrappy means finding something that works, and tweaking it as you go along. If a much better option appears on the horizon, they take it, but they’re not worried about having the perfect solution before they start.

Scrappy means being aware of how your actions affect other people. It means standing up for what you believe, want, and need, but it also means making sure other people are getting the same opportunity.

We want to be a “scrappy” company, with “scrappy” sales reps and sales managers, and a “scrappy” attitude toward getting things done, and done right for our customers.

It hasn’t been released to the public yet, but Inside sales metrics gurus The Bridge Group, Inc. just finished their “2010 Inside Sales for SaaS Companies” report, and they kindly sent me an advance copy.

I’m not going to reveal too much about it, but like their previous sales metrics reports, my reaction can be summed up in a single word:

Awesome.

There’s way too much good stuff in terms of specific metrics, data analysis, and key insights to post here, so go pick up a copy when it becomes available, but there were two key ideas I gleaned from the report:

Idea #1—In very clear terms, the study demonstrates that SaaS vendors have better sales performance than their license software counterparts—and the analysis indicates that it’s probably because they know how to push and leverage their own product solutions to get the highest benefit.

The demonstrated benefits are real and significant. The study shows that on average, compared to licensed software vendors, SaaS vendors:

• Have 20% more reps hitting quota (70% vs. 50%).
• Have more scalable sales processes, with measurable, repeatable, metrics.
• Have a nearly a 25% shorter sales cycle.
• Have higher lead-to-prospect conversion rates.

Some of it may be the nature of the SaaS space, but if the SaaS vendors themselves are getting these kinds of benefits, it seems pretty clear that the people they’re selling to should see some of the same.

Idea #2—It still comes down to Leads.

As the study itself states, “The #1 challenge for inside sales in this model [SaaS] is leads . . . This is a machine that needs to be fed.”

But it’s not much of a stretch to say that the #1 challenge for ANY sales organization is leads. Companies have to optimize and leverage their lead generation strategies to the max, especially when industry statistics show that organizations consistently have their reps make 5 or less contact attempts on new leads, let new leads grow cold by waiting 24-48 to attempt to make contact, and only contact 50% of their valid leads because they’re simply not giving enough effort or engaging in the right processes.

In business, we’re all familiar with the concept of the “Idiot Tax.” If I don’t want to take the time and energy to change my oil, I pay a price premium to have a service center do it for me. In some respects every restaurant on the planet preys on this instinct (“I don’t feel like cooking today”).

And in large account B2B, recognizing when a prospect puts out signs of engaging in these same types of “Pain Avoidance” tactics can pay dividends.

In Griffin-Hill’s Integrity Sales Model, “Pain Avoidance” is one of their classic “5 P’s” of identifying prospect need—Profit, Pleasure, Prestige, Preservation, Pain Avoidance. And though “Pain Avoidance” prospects aren’t as common as other types, in the right circumstances a prospect may be attracted to a product or service even if it’s twice the price and 3/4 the functionality of the competition—because they don’t have to think.

Prospects motivated by extreme “Pain Avoidance” have a much different approach to perceived value. They don’t ignore price and functionality, but it’s more important to them to let someone else handle as much of the process as possible. In their minds, money is a small price to pay to avoid the “pain.”

Sales reps often mis-identify “Pain Avoiders,” because their objections are interpreted as concerns about price or functionality, when in fact it’s the opposite. The prospect sees the value, they’re just highly concerned about what’s going to be required to get it.

On the phone, “Pain Avoiders” will often seem more concerned about how your product or service is going to disrupt other departments instead of their own, as a deflection mechanism against their desire to not deal with change. “Pain Avoiders” are generally highly attached to the status quo, and are only in the market for a new solution because their situation and circumstance require it. They often have a maddening ability to show interest in what you’re selling without particularly committing to anything concrete (because change = pain = something to be avoided).

In the consumer space, Apple is a classic example of targeting “Pain Avoidance.” While they frequently tout the functionality of their devices, one of Apple’s most compelling “value propositions” is Pain Avoidance—avoiding viruses and spyware, avoiding complicated interfaces, ease of setup, total interoperability between Apple devices. And a lot of consumers are willing to pay Apple’s price premiums (50-100% higher cost against comparably spec’d offerings) to get it.

In the same vein, if you find a prospect that seems sold on the product or service, but is exhibiting “Pain Avoidance” symptoms, do some needs analysis and think about restructuring the pricing and service levels. Typically this means that they’ll be paying a higher price premium for the assurance of the service they’re going to receive, but in the end they’re much happier with the perceived “value.”

In two previous posts, we’ve identified that:

The question I asked at the end of Part 2 was, “How can you align a marketing team to produce sales leads without hurting, or challenging marketers’ deeply held beliefs about the need to create an emotional connection between a buyer and a product, a person and a brand?”

While I don’t know all the answers, I can offer the following advice, based on our own experiences here at InsideSales.com:

1. Make an explicit, hierarchical list of priorities that align your marketing production to your sales.

One of the first things I did when I sat down with our marketing team earlier this year was draw up a “focus list” for each of our daily activities. Any time we sign off on an activity, the global priority is established with it. Our list is provided below, yours may differ:

1. Remove barriers that cause drops in incoming leads (i.e., refining split test Web content that doesn’t appear to be working, Google Ad words / keywords / ads that aren’t working, bad PR. Obviously the worst type of “Bad PR” is poor service and product, but the marketing team rarely has control over those issues).
2. Increase existing media conversions.
3. “Widen the funnel” on existing media.
4. Find new media to generate leads.
5. Increase Credibility.
6. Sales Story
7. Collateral
8. Corporate Communications
9. Research
10. Brand

Notice that “branding” and “research”—two of the items vigorously attacked by BNet’s Geoffrey James as being superfluous for most B2B marketing organizations—are the last two items on the list.

2. Acknowledge marketer’s need for recognition.

Though company goals are always the same, marketers often want to be “rewarded” in different ways. Most sales reps don’t care about being “recognized” by the company for their efforts; their own internal satisfaction (and big pay checks) are enough. Marketers, while they appreciate a nice bonus as much as the next guy / gal, typically crave praise. They want recognition for the ideas they produce, as it resonates with their internal dialogue of creativity.

3. Don’t ignore branding activities altogether, just prioritize them against the need for direct sales results.

Studies have shown that a consistent “branding” message does lead to gains in sales over the long run, so it’s important to have a “look and feel” that’s appropriate to company need and industry. But the fact of the matter is that there are very, very few B2B “love brands” (i.e., brands that cause users to “self-identify” with the product), and trying to “manufacture” one is most often futile. A consistent message of value, productivity, and credibility wins the day in B2B marketing.

In my last blog post, I discussed the fact that sales and marketing teams largely come from a different set of internal “cultures,” cultures whose viewpoints and and attitudes are often at odds with each other.

In Part 2, I want to take a closer look at this concept, because as sales and marketing teams continue to evolve, and move ever closer in alignment, at some point the “culture war” between the two will spill over into the corporate workroom.

In review: Sales “culture” is business- and results-oriented; marketing “culture” is connection- and human-interest driven.

The question becomes, when push comes to shove, which viewpoint takes precedence?

BNet Business guru Geoffrey James gives us the answer—and it’s based on a belief I’ve long held myself:

“In business-to-business (B2B) firms, the legendary conflict between sales and marketing stems from a difference of opinion about what marketing should be doing. Most marketing professionals believe that they should primarily be concerned with market research, building brand equity and creating marketing materials. Most sales professionals believe that marketing should be generating qualified sales leads.”

Very true. But the next part is where the article gets interesting:

“This is part of the blog where I’m supposed to be diplomatic and politically correct, and write some yada-yada-yada about teamwork and respecting differences, etc., etc.

Forget that. Here’s the honest truth: Marketing is dead wrong; Sales is dead right. In B2B environments, marketing is only useful insofar as it generates qualified sales leads. Period. The glamorous activities near and dear to the hearts of B2B marketers everywhere have almost no impact on selling, other than driving up the cost of sales . . . [Marketing should be compensated] based upon its ability to reduce cost of sales. Period.”

And as much is it will pain my own internal marketing team to hear it, Geoffrey James is right.

I don’t want to devalue the work, effort, and talent of marketers (especially my own), but in the B2B space, the best value a marketing team provides is in the ways it can get my sales team more qualified leads today.

The question for B2B sales and marketing managers then becomes, what does this mean from a corporate development standpoint? How can you align a marketing team to produce leads without hurting, or challenging marketers’ deeply held beliefs about the need to create an emotional connection between a buyer and a product, a person and a brand?

Stay tuned for Sales and Marketing “Cultural Alignment” Part 3

Having just re-read sales and marketing blogger Adam Needle’s 4 part series on the “Unspoken ‘Real State’ of Modern B2B Demand Generation,” I once again cannot commend enough the value of the data and analysis he presents. If you have any interest at all in B2B sales, marketing, branding, or sales management, this is a fantastic set of articles.

So go read them now, and then come back.

Welcome back.

One the biggest challenges of my current position with InsideSales.com is making the connections between sales and marketing more visible, repeatable, and cost effective.

And a key idea that kept pounding in my head while I reviewed Adam’s material was that aligning sales and marketing is difficult because employees on each side largely come from two different production “cultures.”

In a nutshell, sales are largely business types, marketing people are creatives—and getting the two to take a look through the other’s “lens” often sends them into foreign territory.

Most sales people are brought up through the ranks of business schools—or at least integrated into a business culture. Whether or not they actually finish a college degree, good sales pros typically show an interest in management, business, and corporate practices. Even sales reps brought up through the “school of hard knocks” without any formal education eventually get enculturated into a business mindset:

Production, ROI, pipelines, and bottom line. Inventory, cash flow, expenses versus revenue.

Marketing people, on the other and, generally see themselves as artists. Communicators of a deep, psychological mystery that connects them (and their marketing message / brand) to the human race at large. They’re designers, writers, illustrators, graphic artists, brand experts, ad campaign managers.

This is not to say that the two sides can’t cross over into the other’s territory. But at their roots, the core “language,” the underlying views and ways of thinking for each side are fundamentally, intrinsically different.

Now of course, any good marketing or advertising executive will tell you that the bottom line is ALWAYS more sales. But when I talk about “culture,” or “language” I’m not talking about the conversations that go on in weekly management or sales meetings—I’m talking about the internal dialogue of the employees doing the actual work. The self-perception of those sitting at their desks, pounding out digits on their keyboard or phone (of course, our sales reps don’t literally “pound the phone,” since they’re using our PowerDialer sales tool, but I digress).

The bottom line is that the language of sales is about ever-increasing numbers and revenue. The language of marketing is about “connecting” with people.

More on this tomorrow.

(Editor’s Note: Rod Sloane makes an interesting comment below, stating that most sales types he knows largely “fell out” of the ranks of a typical college education. Just to clarify, my point is not to say that sales reps are “college educated,” merely to say that whether college-educated or not, most of them self-select themselves as being part of a “business culture” and “business mindset”—competition, results-oriented, facing challenges, etc.)

At InsideSales.com’s company-wide meeting this morning, it was brought up once again that though we have made significant inroads in solving customer service issues, we still struggle on occasion with truly satisfying our customers’ needs, as evidenced by the loss of a few accounts this last month.

It’s the never-ending story of finding the right balance.

How much support do our clients need?

How many service agents do we need in place to effectively provide quality service?

How can we better set up and train clients to use the system?

How can we provide more effective “self help” options?

How can we make the use of our software easier and more intuitive?

If you’re looking at those questions and saying, “All of them need work,” you’re right.

There’s no one right answer, and even if there was, it’s probably interrelated to three or four others. There’s no magic formula, no secret sauce we can pour over the heads of our employees and make client attrition simply disappear.

But if you’re like me, you’d probably like to know what was working and what wasn’t. What has the biggest impact, what’s going to make the biggest difference right now (hence the need for active, engaging customer service, and CRM principles).

As Jack Trout’s “Law of Singularity” states, “In each situation, only one move will produce substantial results.”

Implementing the move itself is the easy part.

Knowing how to find it isn’t.

I bumped into this post on The New Sales Economy, and thought it was a worthwhile read on inside sales best practices (thanks to Trish Bertuzzi for the link).

Using The Bridge Group’s data, author Chad Levitt asks nine highly relevant, incisive questions about the current state of professional inside sales.

I was particularly interested in one of the questions—”Is there a disconnect between sales management and front line sales reps?”—because in my experience, even the best organizations occasionally have holes, or disconnects in their sales process.

For example, when we did our 2008 Lead Response Management Study, we were shocked to discover that 45 percent of the top 500 companies in terms of Web marketing budgets didn’t even respond a single time to a Web-generated lead.

So why do disconnects like this happen?

Most of the time the root causes are very simple:

• Organizations simply don’t understand the value of the action they’re not taking (e.g., immediate response to Web inquiries = dramatic increase in qualified leads).
• There’s no incentive for someone in the organization to monitor the activity (i.e., because no one understands the value, there’s no expectation of accountability).
• The process they have in place is too inefficient to get the expected benefit (lack of automation, inability to get information to the parties fast enough).
• Changing the process seems like it “takes away” from “more important” activities (i.e., “We need our sales reps and managers selling, not managing leads”).

The bottom line becomes massive disconnect, sales reps not hitting quota, and managers griping about sales performance.

Stumbled across this blog entry recently on Glance Networks, and having done exactly what Tom Scontras is talking about for three or four years now, I related completely.

He nails #4 on the head—it’s a constant game in both sales and marketing to not outsmart ourselves. Don’t toss away something that works pretty well in hope of chasing the “home run” without really, really researching it out first.

We’ve wasted a lot of dollars over the years because we forgot to split test everything. When it comes to your lead generation efforts, don’t make decisions based on your gut. I’ve discovered that there’s almost always a way to measure results, and then improve. It takes time and effort, but aligning your ad words, ad impressions, click-through, conversions, and sales process creates power and synergy.

The other thing Tom hits out of the park is the idea that the marketing to sales transition needs to be seamless, from first “touch point,” to conversion, to feedback. I’m still shocked, frankly, how many companies still haven’t figured out that they’re wasting money on marketing when they don’t have any real way to measure what’s working and what’s not. If online CRM seems to be more hype than substance lately, it’s only because there’s a lot of people who are willing to sell the software, but don’t have a clue how to really make it productive for the people who use it. The fact of the matter is, the only way to do what Tom’s talking about—making the marketing-to-sales handoff seamless—is to leverage current technologies for all that they’re worth.

“Seamless” means the prospect never knows there’s a transition. It means the sales rep knows exactly how the prospect got there, which lead source generated them, and what the prospect sees as being most important. Seamless means that ad words and sales collateral translate across team lines. Seamless means shared mind set. It means that sales and marketing—two organizations that have historically gotten along as well as a pit bull and a Siamese—are working in parallel, and not just meeting each other occasionally as they zig-zag across the company sales “goal line.”

First of all, let me be up front and say that Trish Bertuzzi is a colleague and a friend of mine, so take that for what it’s worth.

That being said, her company, The Bridge Group, Inc., recently released a fascinating research study on the state of inside sales organizations in 2010.

Even the shortened, “highlight reel” version on Bridge Group’s blog, found here, shows some keen insights into the direction that companies are going with their sales teams.

A couple of highlights:

• Per-rep quotas are up across the board—but the percentage of reps hitting their quotas is low (40 percent or less).
• The average number of calls to marketing-generated lead has dropped 43 percent. Think there’s any correlation to this and the fact that reps aren’t hitting their quotas? (Our ground-breaking MIT research study has some answers to why fewer phone calls = a bad, bad thing for sales teams.)
• Of the 115 companies surveyed, the average organization’s inside sales team had grown 280 percent since 2007, in terms of total people employed.
• 89% of respondents said outbound phone calling was a primary function of their inside sales teams.

What does it all mean?

Mostly what we’ve been saying for for a little while now, that inside sales is quickly going to become Inside Sales—no longer just an “outlier” sales department whose primary function is lead gen and nurturing, but will be the heart of the 21st century sales team.