Why Are Industrial Companies Missing from Social Media?

industrial companies social mediaThe number of industrial companies that have not embraced social media as a channel for sales and marketing continues to surprise me. Here are three reasons why they should:

Reason #1: Social networks are incredibly popular.

Most of us agree that the job of sales and marketing teams is to be where your buyer is. Literally billions of people are active on social networks on at least a monthly basis. Although the growth of social networks is slowing in some countries, certain areas (like India) are still catching up; eMarketer estimates that 2.33 billion people around the world will be active on social media by 2017.

Reason #2: The buying process frequently begins online, via search engines and social media.

Despite the perception that social media is successful mostly for B2C companies, it’s  undeniable that many B2B customers turn to search engines to shop. Social selling evangelist Jill Rowley has estimated that 37 percent of buyers look for suggestions or feedback on social sites. And ADP Vice President of Inside Sales Strategy and Innovation Liz Gelb O’Conner has reported that 88 percent of B2B buyers use the Internet to do initial research on purchases. If you and your company lack a social media presence, you’re automatically invisible. Meanwhile, if your competitor has a YouTube channel and their best salespeople have active and engaging LinkedIn and Twitter accounts, those are likely the pages your prospect is going to find during an online search related to your product or solution.

Reason #3: Many enterprise companies use social media to build brand awareness, create relationships with prospects and customers, and generate revenue.

Aberdeen Group has reported that sales professionals who use social selling help best-in-class companies achieve a 16 percent gain in year-over-year revenue, four times better than typical companies. Last year, at least one survey found that three quarters of reps using social media exceeded quota 23 percent more often than their peers. In 2009, Dell was one of the first companies to hop on the social bandwagon; the company used promotions via Twitter to generate $6.5 million in sales of PCs, accessories, and software. More recently, ADP has closed deals ranging from $2,500 to more than $1 million via social selling tactics and tools like Google Alerts, LinkedIn Groups, and LinkedIn’s Advanced People Search.

Despite all the evidence pointing to the value of leveraging social media for selling and marketing, many executives at industrial companies still aren’t convinced. The employees at many industrial companies aren’t even allowed to log onto to Twitter, YouTube, or Facebook while they’re at work. I’ve heard the leaders of these companies say things like, “Our buyers want to meet face-to-face. That’s the only way to build relationships in our industry,” or “We don’t need to be on social media to create awareness. Our brand has been around for 50 years. Everyone already knows who we are.”

In my view, this is a huge mistake. Social media is now part of the buying process for everyone. Social a great way to get insight, gain access, and build trust. Any company not investing in social media initiatives is missing out on revenue opportunities, and I believe that gap will only continue to increase over time.

If you want to see how adding social media to your sales and marketing mix would impact your bottom line, check out our Social Media ROI Calculator.

[Photo: Flickr

Five Reasons Hosted ROI Calculators Trump Excel Spreadsheets

When prospects come to your website, do you make it easy for them to see how much money you can save them? Do you have ways of clearly showing on your website how much more revenue you can help them generate?

Moreover, when your sales reps actually get to interact with prospects, are they well equipped to show the value of your solution in dollars and cents?

Whether for lead generation or closing deals, many sales and marketing teams have generated spreadsheets using Excel to illustrate the value of their solution or product. However, spreadsheets pose a number of problems — in the worst cases, these problems result in prospective buyers moving on to the next vendor’s website or dropping out of deals altogether.

An online ROI calculator built using a dedicated platform can help you avoid these challenges. Consider the following reasons spreadsheets fail and why hosted ROI tools are typically superior.

1. Salespeople dislike overly complex marketing assets. Whenever sales reps think a spreadsheet looks too complicated or dense, they usually opt to leave it by the wayside rather than incorporate it into their selling process. This is a waste of marketing dollars and needlessly leaves reps unable to illustrate your solution’s value. Consider the complexities in the image below, which is from an internally-created ROI calculator shared with me by one of my clients, a $1.2 billion technology company. One of the reasons they came to me is they were looking for a simple, attractive user interface to overcome sales resistance, an example of which is also shown below.

Spreadsheet SummaryROI Tool Summary2. It is difficult to create compelling summary reports within spreadsheets. Again, from my same client, the images below show the difference in presentation. Prospects today expect reports that not only look professional but also are easy to share with colleagues.

Spreadsheet ReportROI Tool Report3. Spreadsheets are notoriously error prone and difficult to maintain. This is one of the biggest reasons spreadsheets tend to fall into disuse. By contrast, ROI platforms are centrally managed and maintained, and thereby eliminate version control issues, outdated data, field modifications, and unauthorized usage.

4. Prospective buyers question the credibility of spreadsheets created by vendors. Generally speaking, ROI calculators created by third parties are viewed as more trustworthy than homegrown spreadsheets.

5. Spreadsheets are not mobile-friendly. Mobile devices limit the user’s ability to access and easily view spreadsheets. Contemporary ROI tools are designed to accommodate all types of devices.

Changes in B2B buyers’ behavior and the ubiquity of mobile devices have converged to make spreadsheet-based ROI tools passé. What’s a savvy B2B marketing and sales organization to do then? Many companies decide they’ll build a tool on their own. However, based on my experience, this usually incurs internal costs that can be far higher than simply contracting with an established vendor that creates ROI tools. My recommendation is to find a vendor with an ROI platform that can easily deploy, maintain, and update your ROI tools. This will allow you to drive the most incremental revenue and to do so with a cost effective budget.

What are you doing today to show prospects the value of your solution? What are the pros and cons of your approach? Please share your experience below.

B2B Sales Always Comes Back to Selling Value

I recently came across this insightful blog post, How to Sell Value to Your Customer, that outlines a four-step process on how to sell on value. I want to take the last two steps and point you to some real life examples that might help you better relate to the points and achieve sales success.B2B Sales Always Comes Back to Selling Value

Step 3 – Identify Specific Values

This step really comes down to finding, for whatever problem your solution solves, where and how that problem manifests in your prospect’s organization. Read The Hidden Cost of Office Printing and Scanning: The Nuance Story to learn how one of my clients successfully addressed that challenge.

Step 4 – Quantify the Value

I would like to take point this a bit further. I believe that you not only need to provide an estimate of your offering’s value that is conservative to maintain credibility but also that the estimated value has to be something your customer believes. Your conservatism does no good if your prospect is even more conservative. It’s always a good idea to start with an industry benchmark or proof point if possible, but don’t let the conversation end there. Spend time with your customer until he or she is on board with the projected value. Read Success Story: How One ERP Vendor Proved Value to Prospects to discover how one of my clients used an ROI calculator to do just that.

How do you sell on value? Share your thoughts in the comments section.

Four Mistakes Sellers and Marketers Make

Making mistakes can be uncomfortable, but they’re a good opportunity to learn and improve (or at least move on). Here are four mistakes we’ve written about recently on our blog that we see in sales and marketing organizations. Feel free to share some of the major missteps you see among sellers and marketers in the comments section.

Mistake #1: Relying on spreadsheets for your presentations.

Have you ever made calculations in Excel to help convince a prospect to invest in your solution, only to find that a simple data-entry error foiled the end result? An analysis of multiple studies on spreadsheets from 2008 found that 88% of spreadsheets have errors. In addition, even the most carefully assembled spreadsheets contain errors in one percent or more of all formula cells. A complex sale typically involves complex calculations. The more faith you put in manual data-entry into spreadsheets, the more you risk making a simple error that could potentially result in a mistaken conclusion. An ROI calculator can easily prevent this. Not only will an ROI calculator prevent data-entry errors, many prospects are more inclined to put their faith in numbers generated by a calculator that’s been created by a third-party vendor.

Mistake #2: Not properly preparing reps to make sales calls.

According to Forrester research, only 13% of customers believe salespeople can demonstrate an understanding of their business challenges and how to solve them. What does this mean? Sales leaders are sending their reps into the field without giving them the tools to win. If this describes your sales team, I would say it’s time to dig into two areas of the organization. One is sales management. Explore sales coaching and training options you can provide for your reps. The second is product marketing. Strong assets from marketing can help reps explain in clear financial terms how they can help solve a prospect’s business challenges (which is a must-have skill in today’s business environment).

Mistake #3: Talking about ROI without understanding what it really means.

Do you every talk about “ROI”? Do you know what the term really means? During my first job out of college as an engineer, I became an economic evaluator. That meant part of my job was to evaluate capital investments and decide whether they represented a good investment for the company (including evaluating the payback period, NPV, and ROI). So that was where I learned a lot about financial analysis and how to talk about numbers with CFOs. I frequently hear people use the term “ROI” inaccurately. In a casual conversation, people might still give you the benefit of the doubt and have faith that you know your stuff. However, if you’re making a formal presentation or having a serious conversation with a prospect who’s well versed in financial terminology, any misuse of the term could obviously leave a disastrous impression about you and your company. Don’t let this happen to you — learn the proper definition of ROI and how to use the term to your advantage.

Mistake #4: Asking sales reps to become financial experts.

A salesperson’s biggest strengths are building rapport, understanding business problems, negotiating, etc. Although business acumen is important, some sales organizations are taking it a step too far by asking reps to essentially build what amounts to a financial analysis so that reps can say to prospects, “Here’s what the ROI would be when you invest in our solution.” This is putting too much on a sales rep’s plate. A better approach would be to embrace an ROI calculator that can be used over and over again with prospects in your target segment. With simple navigation and ease of use, an ROI calculator built upon a software platform can easily uncover the costs of buyers’ problems. These sales enablement tools seamlessly calculate the key financial metrics.

What are some mistakes you see in sales and marketing? Share your thoughts in the comments section. 

Three Qualities That Will Win a Buyer’s Business

Why does one sales team win a customer’s business, while another sales team finishes in second place? According to research announced in this blog post, New Sales Research: What Sales Winners Do Differently, three simple selling behaviors separate winning sales teams from their competition.

The findings of the study, published by RAIN Group, are based on an analysis of more than 700 B2B purchases from buyers representing $3.1 billion in annual purchases. Let’s look at the top three factors that buyers attributed to sales teams that won the buyer’s business:

  1. Educated me with new ideas or perspectives,
  2. Collaborated with me,
  3. Persuaded me we would achieve results.

Now let’s look at these same factors and see how buyers ranked second-place finishers in their ability to demonstrate these attributes:

  1. Educated me with new ideas or perspectives – 42nd place (dead last),
  2. Collaborated with me – 26th place,
  3. Persuaded me we would achieve results – 41st place.

Obviously the second-place sales teams were not trying to lose the deals on purpose. I think the likely problem is their failure to adapt to changing buyer behavior. For the second-place teams, unless they recognize what has changed (see the top three factors above), their only chance for success is if the winner is not in the deal and they are only competing against the third-and fourth-place vendors.

What I found encouraging was the behavior of sales winners. The three main verbs from their success factors (educate, collaborate, and persuade) are the building blocks of the approach that I advocate (aka, ROI-based selling). The keys are for salespeople to help prospects:

  1. Better see the magnitude of their problems,
  2. More clearly imagine how things could be better,
  3. Work with them to project measurable results, and
  4. Deliver a business case to overcome internal objections.

There are different types of tools that can help salespeople accomplish each of these four points and communicate value at different stages of the sales cycle. Regardless which tool you use, the fundamental approach remains the same: educate, collaborate, persuade. By shifting their focus to what buyers really want, I believe that second-place finishers can become sales winners.

Do you use tools that help you educate, collaborate, and persuade buyers? Do you agree these are key selling behaviors to win with buyers today? Share your thoughts in the comments section.

ROI Selling: Four Opportunities to Advance Your Sale

When customers make a purchase, they typically go through a few different stages. As a seller or marketer, your job is to help shepherd the customer through these stages quickly and efficiently.

Based on our experience, here are the four most common stages of buyer purchasing behavior, plus the tools you can use to advance the sale to the next stage.

1. Customer assesses the problem.

In this stage, the customer is trying to assess the problem and figure out how their performance compares against benchmarks. At this stage, a simple assessment tool can help customers get a feel for how they’re performing in the market.

(To capture more leads from your website, provide visitors with an assessment tool.)

2. Customer quantifies the value of the problem.

At this stage, the customer is saying, “This solution looks interesting … but is it worth it to me to implement it?”

This is when sellers and marketers must quantify the value of the problem for prospective buyers. In other words, if the prospect were to solve this problem, how much money will they either be able to potentially make or save by doing so?

It’s important to note that when customers quantify value, they’re simply trying to figure out how big the problem is. Is this a two million dollar problem, or a 10 million dollar problem? (Note that you’re not yet discussing how much investment it will take to fix the problem — that happens at the “justify the cost of making a purchase” stage, explained further below in this list).

(To capture more leads from your website, provide visitors with a value calculator. )

3. Customer compares alternative solutions.

Frequently (but not always) customers reach a stage where they want to compare offerings. Essentially, at this stage you’re trying to show the customer why this company should buy from you and no one else. Your Company has one offering; XYZ Company has a similar one: which one is best?

At this point, we advise using a TCO (total cost of ownership) tool, which will provide calculations showing the value of one solution over another, over the same time period.

(To close more competitive deals, provide your sales team with a TCO tool. )

4. Customer justifies the investment.

One of the final questions a customer will ask is, “Is there a cost justification for me to make this investment?” In other words, the customer wants to know what the return on the investment will be if he or she buys your solution.

Unlike the stage above in which the customer assesses value of the problem, this stage identifies the cost involved in investing in a solution to that problem. In other words, the problem could cost $5 million, but if the solution requires $10 million to solve, the company should probably address another area or spend resources elsewhere. On the other hand, a problem that costs $2 million and only would cost $150,000 to solve would be worth doing something about. (A good rule of thumb is to ask yourself whether or not you’ve made a case that will cause any Chief Financial Officer to sign off on a major expenditure.)

(To close more deals rather than losing to “no decision” provide your sales team with an ROI calculator.)

Many sellers and marketers won’t have to use all of these tools — very commonly our clients end up using just two or three tools in combination. For instance, a TCO tool is not really of interest unless you’re losing lots of bids to competitors. Similarly, if you’re losing business to “no decision,” or only have a 10% close rate on a large funnel of opportunities, then you need an ROI tool to help you justify the cost of investing in your solution.

Also, not all customers go through each of these stages. Some customers, for example, go straight from “quantify value” to “justify investment.” (In fact, a value calculator plus an ROI calculator is what we most commonly deliver for our clients.)

What’s your biggest selling/marketing challenge, and what tools are you using to overcome it? Share your thoughts in the comments section. 

Discussion with a Sales Leader: The Transformation of the SunGard Sales Force

Last week I spoke with Ken Powell, who’s been leading a sales transformation at SunGard in his role as VP of Global Sales Enablement. (He was also a speaker this week at the Sales 2.0 Conference in Boston.)

He joined SunGard just 15 months ago, but his prior experience leading a sales transformation in his previous role at ADP helped him hit the ground running. Already he’s taken many steps to improve sales effectiveness. These have included:

  • equipping the sales team with mobile devices (specifically, Windows 8 tablets, which have “exceeded” his expectations and are “more business friendly” than the iPad);
  • adopting various Sales 2.0 applications (including Xactly, OneSource, LinkedIn, and SAVO, to name just a few);
  • simplifying messaging.

As a company, SunGard is in an interesting spot right now. Formed originally through acquisitions starting in the 1980′s, its primary revenue driver is currently software licensing, although they also have a large consulting organization. Ken said one of their aims is to make the consulting aspect a competitive differentiator.

To that end, Ken has already done quite a bit of work with his team to refine the message his teams send to the market. Whether his salespeople are face-to-face with customers or interacting online, Ken has made it clear that they must connect the capabilities of SunGard solutions and capabilities to business outcomes. Given this initiative, it didn’t surprise me to learn that one of the next steps for Ken and his team is to incorporate value-based selling tools (and TCO tools in particular) into the selling process. In his words, proof of value is “a natural course of a conversation that professional salespeople need to have today when they’re interacting with customers, because it’s an expectation.”

Since I’m in the business of creating ROI tools, Ken asked what I tell clients about overcoming the fairly typical objection from customers about “fictitious numbers.” As we all know, numbers can be arranged in ways that will support almost any kind of story (as Mark Twain said “There are three types of lies:  lies, damned lies, and statistics.”) As a result, many customers look at numbers supplied by salespeople with a very skeptical eye.

I said that, in my mind, a major benefit of using a value calculator (or other tools) as part of the sales process is transparency. Whenever we train salespeople on how to leverage ROI tools, we advocate what we call a “peel-the-onion” approach. Salespeople should rely on the default calculations of an ROI tool to generate an initial report. But the next step shouldn’t be to simply throw the report over the fence and let the customer evaluate it alone. A much more effective route is to say, “We have this tool to evaluate your business case and decide whether or not this solution makes sense for you. Let’s sit down to discuss the numbers together.” After that, you answer questions and adjust numbers accordingly as you go.

With a peel-the-onion strategy, the customer sees the numbers evolve and thus becomes invested in the final calculation. For example, you might change the default analysis from three years to five years on the spot. Or, if the customer pushes back on a point, you have options. If the customer says, “Ok, I’ve seen your case study and how you’ve done this with other customers, but I personally don’t think you’ll ever get a two percent reduction in labor for us.” At that point you can ask the customer what he or she feels is realistic. If it’s one percent, you plug in the numbers for a one percent reduction in labor and show them what that scenario looks like.

The point is to start the conversation with numbers. Numbers will get the customer engaged. Only then can you talk about features and functions and how you’ll be able to support those numbers with your capabilities.

Great sales leaders must make hundreds of choices that will influence whether or not their sales teams succeed. This is particularly true for sales leaders that undertake a sales transformation, which by definition involves countless changes that all tie back to a unifying business strategy. It’s an interesting journey for any sales leader and I look forward to seeing what evolves at SunGard.

Do you have a sales process that supports a business case? What do you say when customers show skepticism about numbers? Share your thoughts in the comments.