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The New Buying Cycle’s Impact on Sales

After listening to the Ziff-Davis B2B Webcast “Beyond SFA:  Maximizing Sales Effectiveness” that featured Dave Brock, I had a few questions.  Using email, Dave and I had an exchange about some of the key ideas from the Webcast that I’ve shared below.  If you missed the Webcast, a replay is available that you can access here.

HankOne of the points your brought up in your presentation was the idea that prospects now want to engage with sellers much later in the buying process than they have in the past, because of the availability of information and use of social media to gain independent information and validation.  That makes sense.

But do you think the buying process itself has changed?

Dave- At a high level, the steps in the buying process, and the sales process, are fundamentally the same as they have been for decades.  Customers need to identify a problem—something they want to do or change, develop specifications or requirements, and so forth.  Likewise for the sales person.

What has changed profoundly is the role of each party within those steps.  It used to be the sales person served a role as a teacher about product or solution capabilities/possibilities so they may have been engaged early in the problem identification and specification stages to help the customer think about what they wanted to do and alternative paths they might consider.

The web has changed that.  Customers can self-educate leveraging the web.  The need for the sales person doing those functions has diminished substantially.

So, at a high level the processes have not changed, but the specific activities and the roles of customers, sales and others have changed (and will continue).

From a sales point of view, if we don’t recognize that change(and continue to do the same old stuff—stuff the customers no longer need or want from sales people), we waste our customers’  time and diminish our value.

Hank - That helps and makes sense, but can we be more prescriptive?  I keep hearing, we need to sell differently, but no real guidance.  Let’s take a “for instance”:

The customer has been executing this new approach to buying and contacts you for pricing after self-educating .  You are worried about being column fodder, worried that you have not engaged earlier with the customer.  How do you change the conversations to effectively “interrupt” their buying process and restart it with a different conversation (and how do you know when to do that v. provide the pricing and get the deal)?

Any ideas?

Dave – Being “late to the party” is not new.   Often, we genuinely have just uncovered an opportunity that has progressed through much of the buying cycle.  It’s important to recognize three possibilities:

  • the customer has already been dealing and influenced by your competitors
  • the customer has already made their decision, but is merely doing their “diligence” so they can justify their decision by saying they have considered several alternatives.
  • in the “new buyer” scenario,  the customer is getting all vendors involved later in the cycle than traditionally.  This doesn’t mean they don’t already have a bias to one vendor based on their past experience or research.

All of these are “risk based” situations.  They are risk based because of the preconceived ideas and opinions the customer may have at the point they involve us.    We have to always remember that while the customer may have preconceived ideas and opinions that are fairly firm—they may not be correct.  If we don’t remember that, we could put ourselves in a worse position.

When we are invited late, our initial focus must be to do a risk assessment, asking the question, “Is is worth my time to get involved at this point?  Do I have a reasonable chance to win?”  Clearly, if the customer is already biased in your favor, it’s great and we might move forward with good results.

If you are not in that position, then the next question is:    “Do we think we can shift the customer’s views toward our favor or to a point that we have a reasonable chance to win.  If the answer is “no”, then it’s probably best to walk away.

(As an aside, there are some interesting strategies around “walking away.”  Sometimes, if you are a significant player/thought leader in the space, walking away would cause the customer to pause and reconsider what they are doing.  For example, for SAP to walk away from competing for a major ERP opportunity in its sweet spot may cause the customer to think, “why would they do this?  There may be something we should reconsider.”  When that happens, they might invite you back, creating your opportunity to shift the customer views in your favor.”)

If we think there is still a chance to win and we want to compete, we can’t forget we have our entire sales process we have to go through.  This is an area where I see sales people make the biggest mistake.  They immediately jump from qualifying and discovering to proposal and all the stuff in between.

Just because the customer is in the proposing stage doesn’t mean we are prepared to be in the proposing stage.

We still have to:

  1. Qualify the customer—this is basically what we are doing in our risk assessment in the previous section, but there may be some additional elements to your qualification stage.
  2. Complete our discovery—there’s critical stuff we need to know to be most responsive (and competitive).  We can’t skip these.  The reason we have them in our selling process is they maximize our ability to win.  If we skip them, we reduce our ability to win and further increase our risk.   So we have to fast cycle through the discovery process — and the customer will be frustrated, but we have to manage that.  Some of that can be done by asking the customer to share the great work they have done to get to this stage.  Let them share the hard work that has gotten them to this point and compliment them on their efforts.  Tell them that we want to be sure that we propose the right things and not make dangerous assumptions that would not be good for anyone.
  3. Do our proposal—based on having completed our discovery.  Without our discovery, we aren’t positioning ourselves to influence, win, etc.
  4. Manage the rest of the cycle.

So our sales process is as critical in the late to the party case as it is in every situation.  This is the worst time to abandon the sales process, yet we really have to manage the customer impatience because they will want us aligned with where they are in the buying process.

Hank –Its sounds to be me like you really don’t believe that the new buying process should radically change how we approach sales fundamentals.  Am I hearing that right?

Dave –   Yes, I simply do not believe that it is okay to be late to the party because of the new buying process.

If this is with an existing customer and you are just getting visibility to this, then it is a sales error—make no mistake about that.  Despite the customer wanting to self educate, it’s the obligation of sales to inject themselves as early as possible.  If this is happening consistently with a sales person, it is a performance issue that management needs to be coaching and correcting.

Let’s not lose the point here.  Too many people are saying “this is the new buying, this is what we have to accept.”  This is just flat dead wrong.  Any sales person or sales executive that accepts this (unless their business model has always been to respond to the unsolicited RFP—and there are some organizations that do this quite well), should be looking for a career change.

Just because the customer wants to change the role within the buying process doesn’t mean that it’s right or that we should accept it.  In fact accepting this from a sales point of view is absolutely irresponsible, because it presumes that

  1. the customer has “defined their problem correctly.”
  2. they know exactly what they should be looking for.
  3. they get accurate information and are interpreting/applying it appropriately.
  4. they are doing a complete and comprehensive job of research.

In reality, all of this can be deadly for the customer.  They can be doing exactly the wrong things.  Particularly in the case of very complex decisions that are made very infrequently.  Think in the case of SAP solutions.  How many times in a CFO/CIO’s career do they make a decision to look at and implement a new financial system?  Probably a very few times, separated by many years, in which what they should be doing and what the vendors can supply have changed profoundly.  Customers simply don’t know how to buy in many cases.

I have no issue with the “new buying.”  I think it’s powerful, it’s what innovative and leading companies have always done, perhaps without the web/technology elements (so the new buying at its core is really not so new but a cosmetic upgrade to best practice from what world class organizations have always done.).

The issue I have is with sales.  It is our opportunity, responsibility, and obligation to provide leadership.  We have to inject ourselves and really create value for the customer through this entire process.  We cannot wait until the end and respond to what they want.  If we do, we deserve what we get.

I can go on, this is an important issue.  We in sales, and marketing, and customers cannot afford to be naive about it.  The “new buying” is not the answer to customer’s prayers.  It is very powerful and offers great potential.  But likewise it can create great risk.

The other point I’ll raise, and perhaps it is as important, is web based self-education will never address the “last mile” issue.  And it’s in the addressing the “last mile” that the most profound issues to the customer arise.  Too often, I think too many customers underestimate this.  Too often, too many vendors let customers underestimate this.  But I’ll save that conversation for another time.

Hank- Those are some powerful statements and really reinforce the idea that sales fundamentals have not changed.  But beyond remembering the fundamentals, what else would you tell telling organizations about dealing with today’s realities?

Dave – Let’s not lose site of the power and leadership we can demonstrate in developing new models of the customer buying experience (as a component of the entire customer experience.)

In the 70-80’s, Walmart, followed by the category killers redefined the consumer buying experience.  Rather than dealing with limited selections at local Mom and Pop stores, the consolidated shopping, enriched selection, and changed the whole ball game for consumer product sales. Giant shopping malls also did this in the 60’s 70’s 80’s, changing Main Street USA forever (interesting to see the current trend in shopping malls recreates the main street USA of old).   Sears did this in the 20’s 30’s with catalog sales.

In the 90-00’s Amazon, followed by a whole number of others changed the consumer buying experience again,  And we will see another revolution in the 10’s 20’s.

Likewise there has been change, cycles and innovation in B2B buying experiences  driven not by customers but by vendors.  So there is a huge opportunity  for innovation that can and should be driven by the vendors.

Too often I think the pundits (and perhaps I’m as guilty) seem to take a “woe is me,” the buyer is in control, we are all victims and we need to change.  The buyer has and always will be in control, we have just been too arrogant to recognize it.  This “new buying” is a godsend to sales and marketing.  It provides us much richer ways and more alternatives to engage and offer leadership to our customers.  It provides us many more channels that we can leverage in tandem.  It drives profound improvements in the cost of customer acquisition and retention.  Technologies like rich analytics give us capabilities that were absolutely impossible to do in the past.  This is probably the most exciting time to be a seller or marketer, and rather than being victims, we should seize the leadership role!

Hank – From this discussion, it is pretty clear to me that preparation is really critical for today’s seller—and requires more detailed effort than ever before.  As I think about technology, I can think of a few things that I would want to be part of an Integrated Sales Technology ToolKit, including:

  • Ability to quickly leverage social channels for customer and market research
  • Access to detailed information on customer activities with my company (purchases, service issues, proposals rejected, etc.)
  • Ways to engage with others for ideas and insights
  • Integrated mobile interfaces so I can move between desktop and devices without extra work

What else comes to mind for you?  Once I have a good understanding of the activities that must be executed in my sales process, then what technologies do I need (ideally all working together) to make my life easier?

Dave – I think the needs are similar to what sales people have always wanted (not necessarily gotten).  But improved technology enables much more to be provided, much more easily.  I look at it from the perspective of how I coach people to execute their sales process.  Here are some things that sales people want/need that should be available to them:

  1.  What’s happening to my customer, in their markets, with their customers, and their competition?
  2. How do I leverage this to identify new opportunities where we can potentially help the customer and grow our business?
  3. Who should I be calling on, how do I get to them?  Who are they, what are they responsible for, how can I use this insight to maximize my ability to connect with them?  Does anyone in our company know the people I want to reach, can I leverage those relationships?
  4. What has been our company’s experience in selling solutions like this to similar customers?  What can I learn from them that might impact my strategy or the calls I make on the customer?
  5. What proofs, case studies, other information can I offer to the customer in the meetings?  How can I start to demonstrate what we can do for them?
  6. What has been our performance against these competitors in deals like this?  How do I put together the most competitive strategy?
  7. What’s been our history with this customer?  What relationships do we have?  Have we had any performance or customer service issues (with the enterprise or this customer)?  Have we dealt with this individual in other jobs/companies?  What was that experience?  Do we have a sense of what the individual thinks of us?
  8. What should I be looking for in developing our value proposition and developing a business case?  What data should I be collecting, how do I analyze and present this to the customer in a compelling manner?
  9. How do I make sure I’ve engaged everyone involved in the decision-making process?  How has this customer made decisions for things like this in the past?
  10. How do we create a high sense of urgency to take action on the customer’s part?  How have we done this with other customers, or with this customer?  How do we avoid a no decision.

Naturally, I want this data where, how, and when I want it, so it should be available on any device I might use—laptop, tablet, phone, other devices.

Hank – Thanks, so to net it out, I think we’ve covered the following:

  • There have not been fundamental changes to traditional buying or sales processes in terms of the steps that have to be completed.  What has changed is the activities within those steps, the order (not always linear), and the tools used to complete them.
  • These changes do not change the fundamentals of selling.  As sellers, we still have to engage with customers, build trust, and demonstrate the value that we, and our company and products, can provide to them.
  • Technology is critical to support sales execution and must be used in a wide variety of ways to efficiently address the activities within various sales activities.

We hope our readers enjoy this discussion.  For more, read the blog posts from Dave or me or check out the Webinar replay that can be accessed from the button below.

 

 

Watch the webinar that sparked this discussion:

“Beyond Sales Force Automation: 
Maximizing Sales Effectiveness”
a Ziff-Davis B2B Webinar 

Ziff Davis B2B Logo

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