Sales 2.0: A "Need to Have" Philosophy to Weather the Economic Storm

News Flash! We are in an economic downturn. Okay, that is old news, but what is your sales organization doing about it? We all want to minimize the negative impact, but what ways of thinking and types of activities are likely to make a difference? The economic forecast is said to be "uncertain" but it is certain that our customers are reducing their budgets and spending more carefully, forcing their vendors in turn to do the same. I believe this economic challenge will accelerate the adoption of Sales 2.0 from a "nice to have" to a "need to have" philosophy. The companies that continue to sell the way they sold in the past will either become less profitable or fail altogether. Customer preferences, the ever-rising cost of sales, and the availability of next-generation technologies are making change mandatory for companies that want to outperform the competition and minimize the impact of the economic slowdown. What is Sales 2.0? How does it work? Sales 2.0 is not a new technology. Rather, it is the use of innovative sales practices to improve business results, while creating value for both the buyer and seller, and is often enabled by Web 2.0 or next-generation technology. Sales 2.0 initiatives typically center on process and customer engagement improvements to increase sales productivity. Sales 2.0 practices combine the science of measurable, process-driven operations with the art of collaborative relationships, using the most profitable and expedient sales resources required to meet your customers' needs. The goal of Sales 2.0 is to produce greater, predictable, repeatable business results including increased revenue, decreased sales costs, and sustained competitive advantage. Sales 2.0 initiatives require changing mindset and adjusting sales strategies. A relatively simple Sales 2.0 example involves selling more through video or web conferencing. This can be done by inside salespeople, or by field salespeople who now perform more of their job from their desks. Selling more efficiently can also mean selling more effectively. For example, many buyers now prefer to meet remotely via conference calls with video or web conferencing, and salespeople benefit from gaining additional selling time that otherwise would have been spent traveling. A traditional sales process that included three or four onsite visits might now have zero or just one face-to-face visit. The financial impact of reducing travel expenses can be significant and is easily measured. However, the economics of giving your most expensive sales resources -- your field salespeople -- additional selling time can be more compelling. Many products and services, especially those that are relatively small to average in value, can only be sold profitably with a remote or low-touch sales model. The definition of "small to medium orders" is different for every company, but they are generally those that fall into your bottom 50% in value. If ignored, these mid-market customers or transaction types are often missed opportunities for organizations that rely solely or too heavily on a field based sales model. However, when they are sold through field sales, these types of opportunities can derail the field's focus on the most important opportunities while draining the organization's profitability. Another Sales 2.0 example involves using some "science" to accurately capture key market information and metrics such as average sales cycle, average deal size and sales cycle conversion rates as well. By using a defined sales process and data analytics, you can determine how your sales force should be structured and which customers and transaction types justify the assignment of field account executives, inside salespeople, channel partners, or no selling effort at all. Data analytics in this sense can range from rudimentary (i.e., pen and paper) to moderate (spreadsheets, CRM, and most reporting systems) to advanced (dashboards and on-demand sales intelligence). Rather than simply measuring the final result (revenue), a Sales 2.0 approach measures the effectiveness of every stage in your sales process, by salesperson, giving managers the opportunity to provide targeted coaching in areas where each rep needs it the most. Data analytics can also be used to correlate and analyze the specific characteristics of your most profitable customers (I.e. size, industries, locations, buyer types, etc.) that produce the most revenue and profit. Sales and marketing leaders can then use this information to fine-tune your sales model and activities to ensure the loyalty of your most valuable customers and find more prospects like them. How can I begin a Sales 2.0 initiative with limited staff and budget? A key Sales 2.0 tenet involves experimentation and continuous improvement, often through testing new process ideas and piloting new technology. Testing a new sales message, pricing options, a new technology or even a new sales process enables the organization to be innovative with minimal risk. Small pilot programs that use a minimum of resources enable ineffective ideas to fail on a small scale while good ones can be rolled out more aggressively. Many technology vendors offer free or low-cost evaluations or pilots to allow for a proof of concept in lieu of a complete rollout based on little more than blind faith and a hunch. There are numerous sales productivity applications and services that are available on a subscription basis (Software-as-a-Service), which can protect you from large and non-refundable up-front financial commitments. While there is no specific milestone for achieving Sales 2.0 success, becoming a Sales 2.0 organization requires that you proactively adapt and improve so you can stay ahead of your competition and closer to your customers. ©2008 Brent Holloway Author Bio Brent Holloway is an inside sales manager for Verint Systems. He has more than a decade of experience in sales and sales management with high technology companies. He co-authored Sales 2.0: Improve Business Results Using Innovative Sales Practices and Technology, published by John Wiley and Sons in December of 2008, available at Barnes and Noble, Amazon.com and several other retailers. For more information, visit www.sales20book.com