It’s getting harder and harder for B2B companies to win new “white space” customers and make their numbers. Recent studies show;
- Only 42% of B2B companies meet or exceed their targets (CSO Insights study 2012)
- 94.5% of companies increased their sales targets for 2014 with an average increase of 16.4% (CSO Insights Sales Performance Optimisation Study 2014)
- Only 37.9% of Chief Sales Officers are confident of making their numbers (CSO Insights Sales Performance Optimisation Study 2014)
In other words, sales are going down, quotas are going up and Sales Directors are worried.
One reason for this is the Sales Effectiveness Conundrum. This states that in order to make their numbers, sales people need to develop a pipeline of 300% to 500% of their quota – but they also need to spend more time selling and closing deals.
In order to develop such a pipeline they need to prospect, qualify and nurture more leads. But the more time they spend in those marketing related activities the less time they have to sell and close deals.
In addition, because sales people are driven by short term goals they rightly focus their attention on activities that will close business – proposals, presentations, demonstrations, negotiations, meetings to close business and so on.
The more short term deals they have on the boil the less time they spend filling their pipeline. If short term opportunities increase, the pipeline decreases. If they focus on building the pipeline short term deals suffer. It’s a Catch 22 boom or bust cycle that is ineffective and costly.
The traditional approach to winning more business is “we need more leads”. But a more effective approach is “we need better quality leads”. We need leads with the right people at the right level in the right companies, ones who have a need and with whom there is a trusted relationship already in place.
We believe that sales representatives, who are a very expensive resource, should focus on what they are good at – selling. They traditionally aren’t very good at hunting, qualifying and nurturing, or at least not consistently, because these essential activities tend to be neglected whenever there’s something “more important” to do, and there almost always is.
If you want to be sure hunting and nurturing are done consistently and regularly it’s much better to use more specialised, skilled – and less expensive – resources.
When salespeople are provided with plenty of “leads with trusted relationships” they waste less time chasing inappropriate leads. They also have better information about the company and contact when they are following up a lead before they talk to them. They know who’s talked to who, they have profiles on the people and company, they know what collateral they have received and they have an idea of their timeframes and business needs.
So they can go in pre-armed and not waste time going over old ground. They can build on the relationship the lead already has with their company.
Instead of going in cold and trying to build a relationship from scratch – and focusing on qualifying, which isn’t always conducive to developing a relationship – they can further develop the existing relationship and focus on strengthening trust.
They will be repositioned as subject matter experts that can help the customer to achieve their business goals. As a result they will not only close a higher percentage of deals, they will also have more time to focus on face to face selling and closing deals.
And they will sell more and win more new business.
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