Brand versus solution

Companies don’t buy. People in companies do.
If your company has a problem to solve, would you be looking for:
- a solution whatever the brand
- a brand that could solve your solution ?
If you would be looking for a brand is this because “People never gotten fired for buying IBM (or CA or Oracle)”.

Solution or avoid risk taking

What would be or is your primary concern:
- Finding a suitable, feasible and affordable solution at the best price /quality ration
- Saving your career by proposing a solution from a well-known brand

The strange thing is that many new solutions from start-up companies end up getting acquired by big brands. Whereas previously the smart and ideal solution from the small company involved risk taking, once the big brand proposes it the main risk seems to disappear.

Benefits, problem solving and references

This brings us to the next question:
- How significant needs to be the benefit from a small company in order to be considered over the well-known brand ?
- How can the salesman convince you to buy: by understanding your problem ? by giving references ?

Do you buy brands or solutions ?

When there is more demand than available then the seller can set the pricing.
When there is more on offer than demand then the customer can set the pricing if he really needs it.

The Boom Salesmen

Some salesmen start out in the business when there is more demand than available which gives them a bad attitude for their further business life as they are not used to negotiate on the service and pricing. This is typical for boom years where people get big commissions hardly without any effort or reason. They will become big spenders as the money is too easily earned.

Due to the fact it is that easy to sell the business will attract all kinds of people who are not real salesmen. Actually they never really sold. They just acknowledged about the product available, informed about the price and waited for the purchase order to come in.
Once time changes these salesmen have a hard time and find themselves in a job they actually can’t handle as potential customers just not buy after the minimal effort these salesmen are used to do. Soon they will be out of the business although the business keeps on going at a different pace than before.
The boom salesmen are out of business when the bust is coming.

Example: the real-estate broker who started in real-estate in 2004.

The bust salesmen

Other salesmen who started out during economic crises or competing in a market with cheaper foreign products, have learned to sell from the start as else they wouldn’t be in the business within weeks after starting. They know how to sell, get a deal closed against all odds and to survive in difficult times. They will appreciate every deal as each brings them a part of the necessary commission.

Example: the national office equipment salesman competing the Chinese products who started in 2004.

Segregating the fake from the real salesmen

Getting into a booming market or business will bring great opportunities and big commissions, but in most cases it won’t last a decade. The problem then poses is what to do afterwards as these people aren’t really into sales and are used to a high income.
The bust salesmen who started out in a difficult market know how to survive as they really can sell products and also them selves.

Are you a boom salesman or a bust salesman ?

Popstars

Madonna has sustained her music stardom and success for over 25 years by reinventing herself.
Most pop stars are one day hit wonders or have maximal 2 or 3 hits. Then their success, fame and income fade away. Taste, culture and demand have changed and so does the success of most pop stars. Taste, culture and demand are changing continuously.

Changes in society and business

As a successful salesman you believe your sales skills will last for ever as you can turn anything into gold while being successful.
However times, culture, attitudes and demand are changing too in business. Changes of people in companies. Changes in business. Changes in market. Changes of attitudes. Changes of purchase cycle. Changes of decision making an taking. Changes in perceived value. Changes in society.

What worked previously will not work anymore sooner or later.
Your introduction, your catch phrase, your lead generation, your sales pitch, your jokes, your sales cycle, your way of closing all can and will become dated – outdated. Beware this can happen fast over a short time frame: years instead of decades.

Avoid becoming obsolete

The functions and features of products or services change every year, but these are easy to keep up with. The tangible and intangible benefits are the ones that are more difficult to deal with as they are related to the changes in market, economy, culture and business in general. Your sales pitch might even become obsolete as people expect a service instead.

Just like a long lasting pop star, a salesman need to reinvent himself as attitudes and the way people investigate to buy products and solutions change as society changes. make sure you don’t become obsolete.

When was the last time you reinvented yourself ?

Sales techniques

During the last century many selling techniques and methods have been developed like Feature-Advantage-Benefit Selling, Spin-Selling, Hard-Selling, Soft-Selling, Up-Selling, Consultative Selling, …
Nowadays people have had it with all these sales methods as they don’t want to be sold or pitched. Instead they need a solution for their problem which is the main thing they are interested in and will remember afterwards.

Listen instead of selling

Instead of selling or pitching you should be adding value for the customer. In the end the customer needs to sell its’ product at the best price or with the best quality or at the best price/quality ratio. These are the main drivers for a company to buy new products, services or solutions.

You have to understand problems of your customer, their issues and constraints given the business, competitors, market and economy. Hence you need to listen and ask open ended questions. Start from the idea that you don’t know but your potential customer knows all about his business, competitors and market which will help to formulate your questions.

Bring added value

Once you have understood the customers’ problems, issues and constraints then look for a solution – preferably a solution your company can provide.
Be aware the probable customer has researched the market and the solutions available. Time has gone that customers weren’t informed and that they could be lured into a sale, as they have become savvy and aware of the available solutions. This mainly thanks to the Internet and search engines. As a salesman you need to bring added value to the table else than what’s available on the Internet else they no longer need you.

Solution creation

This is not solution or consulting selling as in that case the salesman knows the solution upfront or wants to push a certain solution from the beginning.
Instead it is about, as partner together with your potential customer, seeking and trying to create a feasible and affordable solution. Serving your customer instead in order to bring him added value.

Forget about the sales pitch, listen to your customer and try serving him by delivering added value.

How do you currently sell ?

Recurring Revenue

The best business models are those that allow for recurrent revenue. This can be subscriptions, consumables, utilities or insurances.
The benefit for the business owner is the predictable, stable and can be counted on in the future with a high degree of certainty. The same applies for the salesman as he will get a steady or fixed commission income from these recurring revenues.
Moreover with each customer won, the business revenue increases for the long term.

Recurrent Billing

Although the automatic recurrent billing is the best for driving your revenue as the customer gets billed anyhow. And he will need to take action in order not to get billed anymore, this method is not preferred by the customers. Customers hate the idea to sign-up for a service or a deal which they need to cancel in advance – within the time defined in the contract – in order not to get billed again. It is just too much hassle and not customer friendly as they feel tied up.

Recurrent Billing Issues

There are other issues with recurrent billing: for example if the price is related or a function of consumption or use which can easily change over time: like consumption level, time used, number of visitors, number of calls.
Any price change will that are billed without notice, will generate questions by telephone, emails and letters which increase the cost of operations significantly as you are dealing with unhappy or even agitated customers. Not exactly the best way to keep your customers.

Price Buckets

In order to cope with small fluctuations in the use of the service, buckets are the best means for keeping the price steady as customers don’t like price changes. Each bucket having an lower and upper limit for the use of the service, consumables, utilities.
Still if the consumption or use of capacity increases beyond the limits of the current bucket, you need to change the price which is a hassle using fully automated recurrent billing systems. Make sure you don’t bill twice or bill the wrong amount.
Moreover you need to inform the customer before invoicing and billing him more as you need to respect your customer. So when will you change the automatic billing amount ? How much time after informing him ? How will he respond to the price change ? What to do if he doesn’t accept it as his contract is not cancelled ?

Recurrent Revenue vs Recurrent Billing

Recurrent revenue is the best business model ever.
Recurrent billing is not really liked by the customers:
- They don’t like to be tied up with your billing
- Consumption fluctuation requires to adjusting prices requiring to inform the customer
Hence in our view it is better to inform the customer before the end of the subscription about the change in pricing (higher or lower) and at the same time inviting him to make a payment for the next period or quantity.
In this way the customer can easily end the contract by simply not paying and he feels free instead of being tied to you as a provider. of course you should ask why he is no longer interested in your services.

LEADS Explorer will inform customers at the end of the subscription about the price for next subscription and at the same time invite them to make a payment. The customer is free to choose to continue or not.

The gap between marketing and sales

Since the early beginnings of the creation of the marketing department, marketing guru’s have argued that sales and marketing should cooperate in order to increase sales and revenue. The gap between both exists and continuous to exist.
In many companies there is even a larger gap between the sales pitches, activities, presentations and meetings of the salesmen and the content on the website by the web marketers.

Website content

In most cases the content on the website is created by people who don’t meet with customers. They actually know little about customers besides general information and statistics making customers like a number consisting of numbers/stats. From their offices it is hard to understand or image what the prospect or customer really requires and wants.
Do they know why the salesmen really sell ? What really sells the product or service ? Do they know the competitors ?

Salesmen know their customers

On the other hand salesmen and sales reps meet with prospects and customers and know what ideas, worries, problems, perceptions and concepts that live amongst their prospects and customers.
The feed back from meeting with customers and prospects to the marketing people is minimal or not existent. As such marketing is creating content which is far or not related to what the prospects or customers concerns.

Product managers

In some cases the product managers are asked to write the website content for their products which is a step in the right direction as product manager do meet customers, but in most cases only important or innovative customers as they do not meet the average customer.
Product managers are halfway through as they know some customers, their products and the competitors.

Content by salesman

In fact it should be the salesman who should write or define the content on the website as they are the closest to the prospect and customers. he knows how they react upon his sales pitches. However a salesman has no intention to waste his time on writing content for the website while he is being paid on a commission on his sales.

The increase of purchase risk

Due to the gap between marketing and sales, it will be hard for salesmen to tell or present the same story, concept, benefits, advantages, industry view and positioning as on the website. If there is any difference then it will induce a hazard or danger for the purchase decision.
Any increase of risk, will decrease the chances of a sale.
Therefor the content on the website should match the content in the meetings.

Sales pitch should match the website

Before the Internet and the almighty presence of the company website, salesmen had only to deal with advertising, press releases or editorials which concerned a small part of the total of benefits, advantages, concepts, views and perceptions . Whereas now the website has all the content only a click away.

Synergy sales en marketing

A synergy between sales and marketing is needed. Even more than before as the website content is visited and inquired before and after every meeting, telephone call and even emails from the salesman. Any difference will increase the purchase risk.
The website content and the salesmen need to align up in order to form one front and have one view exposing the same messages and the same vision.

Do you have a sales pitch matching the website ?

Bull market

When the market is going up and the economy is booming then sales are good. In this bull market the sales price is what the fool wants to pay. The sales price is loosing its’ relation with the actual cost price.
The rational in the purchase decision is minimal due to many other drivers – in many cases intangible benefits. Buying because everybody else buys.

Bear market

When the market is down and the economy is in a recession, then selling is hard to do. In this bear market the sales price is what the vendor (or owner) requires to pay down his credit without defaulting or to keep his business afloat.
The rational in the purchase decision is high as the buyer tries to squeeze out the minimal prize. Only tangible benefits count for the buyer.

Thus people who bought without much or any rational during the bull market, are likely to be forced selling without rational during the bear market during a recession.

The contrarian is the one who buys using rational reasons and sells for rational reasons.

Are you a contrarian ?

In order to influence a purchase in B2B there a wide choice of methods, tools and channels that can be used:
1. Website
2. White papers
3. Case studies
4. Technical articles by third parties
5. Analyst reports
6. Reviews
7. Popular or known bloggers
8. Webinars / Webcasts
9. Video/screen cast
10. Free trials
11. Proof of Concepts
12. Nurturing by email
The problems is that they all are effective, some more than others depending on your market and the product or service you sell, but it is nearly impossible to propose all of them effectively as it just will cost too much money and time.
As a result you will have to make a selection what is best for you.

1. Website without a website people will doubt you are a legit company.
The website plays a large role in all phases of the purchase process.

2. White papers are effective, show your authority and knowledge, but can be too technical or too rational which limits them to the technology influencers. people will download the white papers but gating for this content won’t help much as often free web mail addresses are being used.

3. Case studies have the advantage of a recognizable brand name and a story of a problem getting solved that resembles the existing company. Thus even CxO will read it. However getting the case study written and approved is a long investment.

4. Technical articles by third parties are just to be too technical limiting them completely to engineers and technology influencers.

5. Analyst reports have the advantage that these reports are to be paid by the company or can only be obtained upon request to one of the vendors making these reports more exclusive which drives the interest. Moreover this a a view or insight fro ma third party which is highly respected. There is also a risk involved if the analyst gives you a below average rating.

6. Reviews have the benefit of combining a technical insight, an easy scoring and a short summary for the offering of each vendor requiring not much effort. Even CxO’s will read the conclusion and look into the scoring. Again your product needs to score high as else the review will have a negative effect on your sales.

7. Bloggers that are popular or known will bring their authority and supposed knowledge of the market to the table, which will be taken for granted. As their reviews in their blog posts are short, CxO’s might just read it and stick with it thus you better get a good appraisal.

8. Webinars / Webcasts have the benefit of knowing who is in the virtual meeting allowing for interaction and follow-up. Of course no CxO will ever participate in a webinar, leaving you with technologists, managers and influencers.

9. Videos and screen casts can be great and can be boring – can convince or leave the decision maker indifferent. The cost of creating and professionally editing a video can be high as it needs to be entertaining. One of the problems is that a video is only effective if it is not too long (2minutes) resulting in having to cramp too much information into the short time. And people will press the Fast Forward button missing.

10. Free trials are very tempting and you have to hope the product sells itself. if your product is complex or has special features then you have to make sure people will use these features to make your product stand out.
Actually a free trial can slow down the sales process as the customer first need to install the product which requires time and effort and then during the 15 to 30 days the customer should be using your product which is beyond your control. During the free trial the sales process is being halted as all await the result and conclusion of the free trial, which can take time too.

11. The Proof of Concept is rather similar to a free trial but is mainly to show the solution is actually working within the environment of the customer, but it requires investment of time and money of both the vendor and the customer.
Still the question remains if the potential customer will actually use the system.
And again the sales process is completely halted during the POC (weeks if not months) and the duration of the POC conclusion report (weeks).

12. Nurturing by email is very important too as without it most of the above will be much less effective.

Probably all tactics and methods have their place depending on your market, type of product and what your competitors propose and use. In B2B you have probably be able to offer most of these methods and marketing content as you have to use whatever the potential decision maker expects or requires. Don’t send him an invite for a webinar when he wants a video/screen cast.
Or you have to send a white paper to the technology influencer and a matching case study to the CxO.
Free trials or Proof of Concepts are probably the last step after a longer decision process in order to select between two competitors.
The influence of content by third parties are very important just due to teh fact they are third parties.

What do you use and is effective ?

Lead generation efforts

If you notice a sudden increase of interest for your products or services without having undertaking any important marketing, lead generation or sales effort the maybe your competitor is doing all the hard work.

If your competitor is very actively looking for potential customers by spending large amounts of money on marketing and/or is investing plenty of sales time into cold calling and lead generation, then this will automatically create interest for your products or solutions too as people will research on the Internet for the nearest competitor.

Ride on the coattails of the competitor

Don’t let this opportunity pass by as you soon could be riding on the coattails of your competitor. This requires a high findability on the keywords that are being used by your competitor and a decent Internet presence that gives confidence.
You just need to tease these potential customers enough with your website in order to let them inquiry about your products or services.

Findability- differentiators – trust

Even if you provide a very similar product or service or even a copycat, but are able to bring differentiators, you stand the change to snap away some of his customers at no cost.
All you need to do is getting found, create trust and confidence and clearly present one or more differentiators.
Certainly your competitor will generate more leads and eventually more sales, but at a high cost of marketing spending and sales efforts. Whereas you only have to wait until potential customers show up and explain them the differentiators as hardly any marketing or sales cost.

Competitors make the market bigger

Even the presence of your company and the possibility to inquire about your products or services will eventually also help your competitor to get even more sales only because there is competition and the value of choice.
Hence not only you needs to applaud the sales and marketing efforts of your competitor, he also should be happy with your presence on the market as people like choice and comparisons.

Is your company the sales and marketing driver or are you riding on the coattails of your competitor ?

B2B products are common and without passion

Most products to sell in B2B are not really exiting as they are well defined, up to a certain level of quality, refined and sold based upon facts, figures and references.
The passion and feelings are more related to consumer products.

The passion is in the differentiators

However in any product, even in B2B, there is always possibility to find a minimum of passion and subjectivity. If your product is 100% compatible with the same product of the competitor then you can only sell on price. In most cases you don’t sell on price only as there are always small or major differences and specific functions, features or quality of which you can be proud of – and more important you should make the potential customer aware of and make him proud too having bought the better product.

Sell dreams in B2B

Thus even in B2B you need to sell dreams. Dreams of the better product you sell and they buy. This will increase your sales as you add feelings and passion to your sales pitch. Even if the product is boring and common, try to find the bit extra that sparks some passion.
Sell the dream instead of the product.

What do you sell ?
How do you sell ?