Is it Really the Sales Person's Fault?

I spent quite a lot of the last week working with a company that has gone through 6 sales managers in less than 3 years. That is a lot of sales managers for a young business with aggressive growth targets!

As we worked with the company it became increasingly clear that while the sales managers had not helped much, there were a couple of deeper issues that stopped the company being able to achieve its sales targets. Basically the lack of sales was a message from the market to say, “You are not offering anything we want, so we are not going to buy.” The sales managers were the unwitting messengers.

This was clearly uncomfortable news to the company we have been working with for two reasons:

• It is normal to assume that a lack of sales from a sales person means that the sales person has failed. The result is usually a high turnover of sales staff with all the associated cost and upheaval to the business that might well have been avoided by getting things right earlier.

• It means that the company needs to look deeper and start analyzing more than just a lack of sales. This is an alarming prospect for most companies, which raises all sorts of issues and risks they would rather avoid.

1   It can be very difficult for a management team, especially if it includes the founders of the business to accept this kind of market feedback, especially when it comes from the people that most managers trust least in their businesses – the dreaded sales punter.

There is no hiding from this issue. If your business is not making sales, it’s because the market you are targeting does not want to buy your products as they stand. You can change the sales folk as often as you want, but unless you change the product, or the way you are positioning the product in the market, sales are unlikely to increase.

However, there is a flipside to this.

In all the years we have been doing this kind of work, we have yet to come across a terminal case. In fact some have been resolved with simple measures that have been put in place in a matter of days.

One memorable case I can think of is a tech company that was struggling to make sales and suffering from high staff turnover. Simply by changing the way it communicated with the market and tweaking the message, which took about 2 weeks, the market perception was transformed. As a result that business increased its sales revenues by a factor of more than 10 in less than a year.

So what is the point of this little blog article?

Well it simply this, if your sales team isn’t delivering the goods, don’t just assume it’s their fault. It may well be and we certainly are not suggesting you ignore that.

But…it might also be something that the average sales person can’t change because they are either not skilled enough, or because it is beyond their pay grade.

As always, I hope this helps and I’d love to hear your views and experiences on this.

Do you really want a big corporate customer?

I was talking to a colleague the other day who owns a small business that has a number of small customers and one very large corporate customer. By far and away the worst payer, most demanding and least sensible customer is the huge corporate, which in reality is contributing nothing to the business except cost and hassle.

This is an area that I have been pulled into many times in the past and in every case bar one, when analyzed properly and in detail the only sensible conclusion is to ‘fire’ the big corporate customer.

In theory having a huge global customer sounds like a great idea. Big orders, little or no risk and so on – the fast track to that Ferrari you’ve always dreamed of.

Sadly it is very often the opposite.

Let me share an experience I had a number of years ago in 2010. A company I was working with ran a seminar with a well known global bank. The bank had agreed to allow its procurement team to tell us the truth about supplying the bank. I am not allowed to name the bank publicly and you’ll see why in a minute.

To a room full of excited and enthusiastic potential suppliers, the procurement team laid out how the bank buys and its tactics for getting the best deal:

• Payment terms were 180 days – non negotiable.
• Contracts could be stopped instantly by the bank, but only on the agreed notice by the supplier – usually 90 days or more.
• Procurement would never stop screwing the price paid down or improving on the terms of service required of the supplier until it was convinced it had just about got the supplier to back out.
• Buying cycles were measured in months if not years on average.
• If a supplier could not supply globally it would not be eligible to supply locally.
• As a business, the bank considered that if suppliers barely broke even on supplying the bank that was okay, because just having the bank as a customer would win them other customers.

It doesn’t take much imagination to picture the reaction in the room from all those enthusiastic and eager potential suppliers. Most of them were shocked and many of them angry that a big player would consider treating smaller companies so badly.

However, think on this. That particular bank had a procurement budget of more than $10 billion annually so its buyers were probably quite rightly focused on big solutions from big companies that would ensure that they had fewer contracts and were able to lever economy of scale in ways that buying from smaller companies just would not permit.

The harsh and unforgiving reality is that it is usually a costly hassle for big corporate business to deal with smaller suppliers and often that is why they shy away from it.

It doesn’t mean you should ignore them, but does mean you need to be very clear in your mind what it is that you want from dealing with them. You need to have a plan and the sense to walk away if the deal isn’t right, because make no mistake, if you don’t then you could finish up with a great business being held back by its biggest customer.

Author – Tim Sandford

Content Management or throwing crap at the wall to see if any of it sticks?

Content or just crap?

When I was a small boy, my grandmother used to recite a phrase to us, when any of her excitable grandchildren were talking too much or spinning a tall tale as small children do. She used to say, “if you have nothing useful to say, its better to say nothing.”

Wise words that in my view and something that the content management world might like to consider.

I’ve spent the last few months deliberately subscribing to newsletters from a broad range of business to business vendors that are using a content management approach to generate awareness, interest and sales leads.

The one thing that stands out a mile is quality. It may just be me, but it feels to me that an awful lot of the companies I have subscribed to are generating a vast amount of content of which very little has either any depth or quality. It honestly feels, to paraphrase an old saying that they are just chucking as much crap as they can at the wall and hoping that some of it sticks.

On the basis that content marketing is all about demonstrating expertise among other things in order to be seen as a credible provider of a product or solution, then isn’t it wiser to assume that quality is more valuable than quantity.

To illustrate what I mean, of the 25 companies I subscribed to:

• 60% send out something at least 3 times a week and often more.
• 24% send out something at least once a week.
• The remainder only send out something when they have something of value to say 

The interesting thing, for me at least, is that the companies that are bombarding me several times a week with papers, opinions, blogs and other forms of communication are the ones I will be unsubscribing from now that I have published this blog article. The primary reason being that even with a big team of content experts, not even the busiest companies in the world will have that much to say without reducing quality in favour of volume. As a result an awful lot of what they are sending me is just rubbish without any clear purpose other than to fill up my inbox.

On the other hand the small group of companies that only communicate when they have something of value to say, are the ones I will continue to subscribe to because when they communicate with me, it is of value and relevant to me.

For me it all goes back to that point my grandmother made, but perhaps put in a more positive way – When you have something useful and valuable to communicate to your customers, make sure you do, but don’t waste their time when you don’t.

As always folks it would be great to hear your thoughts on this blog and any experiences you  think are relevant.

Milliband vs the Big 6

So its on! Mr Milliband has declared a challenge for the utilities pricing belt on behalf of the consumer (voter really) – Kid Customer (Mr Milliband) versus King Shareholder (The Big 6 Utilities) - the current, undisputed champion of the utility company boardrooms.

I am perhaps doing a bit of a Hollywood on this, but it is a timely reminder that virtually none of those big public companies have ever really been driven to deliver value to paying customers. Instead they are driven by shareholders who would probably be gleeful to see us all pay twice as much as we already do, so long as it returned them a better dividend.

If you read my blog regularly you’ll know that in my view the boardroom domination by shareholder value has left customers out in the cold and very definitely second class. To give you an example, I used using figures derived from the BBC to calculate that in 2012 the big 6 energy companies generated more than £150 profit for every household in the UK. A little down on 2011, but almost twice as much profit as the two years before. That’s a lot of profit especially in very difficult economic circumstances.

So, do you care a jot what the shareholders get now that you know how much profit they make from you? Or would you rather your utility bills were cheaper?

Thought so. 

What if I suggested that if the 'Big 6' delivered more value to customers, they would very possibly also be able to pay a bigger dividend to their customers?

Apple, the most valuable (regularly) company by market capitalization in the world is also one of the best customer service companies in the world. It focuses heavily on customer value and delivering the best possible customer experience it can. Guess what? It is such a good experience the consumer is often prepared to pay more because it’s a superior product. Its not just Apple either, Rackspace the cloud hosting provider is another similar company leading its market by focusing on delivering excellence to its customers. Again it is not the cheapest, but it is regarded by the market as probably the best there is.

So here is the real point of this little blog. Both Apple and Rackspace are more valuable because they deliver more to customers. As a result both customers and shareholders win.

It’s really obvious isn’t it when you think about it. Delight your customers and they help you attract more customers. This is essentially the old fashioned basis on which businesses grew – they did a good job for their customers, knowing that it would help them get new customers.

So here is a simple little idea for the folk at the ‘Big 6’ if you don’t want to face the challenge from ‘Kid Customer’ in 2015 why not start really thinking about the people that pay your bills, they are at least as important as your shareholders. What's more if you look after your customers you'll probably be able to pay your shareholders a bigger dividend.