All sales execs are asking themselves the same question about their sales pipelines. Unfortunately, the issue is that you know where your sales pipeline is, and it isn’t where it needs to be. The dynamics of the sales funnel and sales conversion ratios have been changing over the last ten years. The trends and prognosis aren’t positive. Most sales surveys are showing:

• less sales reps making quota
• sales cycles getting longer
• less qualified leads
• lower sales conversion ratios

I was a VP of Sales for a publicly traded software company and we could forecast within 2-3% accuracy how many deals we would close that quarter based on our historical conversion ratios. Now there was a discipline required in how we ranked the sales opportunities within Salesforce.com and good sales management reconciliation of the sales reps forecasts against reality. But having said that, we were able to provide highly accurate visibility in to the forecast and our actual revenues. We would know 45 days in to our quarter that we would close almost exactly 30% of the total deals that were forecasted at certain levels for that quarter. The problem was that you couldn’t make up pipeline shortfalls in the quarter at that point, given the length of the average sales cycle.

I’ve always subscribed to the notion that you have to understand the underlying math variables (i.e., sales pipeline conversion ratios, average deal size, average sales cycle length) to properly run your business and have accurate visibility in to your future sales results. How do you know how much you need to invest in lead generation programs? How much in expenses or costs will you have to cut if you determine that you have a sales/revenue shortfall? Is there a sales/revenue opportunity that isn’t being optimized? All of those questions fundamentally rely on knowing your sales pipeline conversion ratios well.

So, I close with a question: “Sales Execs, It’s the 4th Quarter. Do you know where your sales pipeline is?”

The post Do you know where your sales pipeline is? first appeared on True Sales Results.

A basic sales funnel would typically include stages such as:

* lead * qualified prospect (meets BANT criteria) * qualified sales opportunity (engaged in actual sales process) * closed new customer or revenue

There are conversion ratios for each stage of the funnel. It varies for every product or service, new company versus established company but an example would be the following:

* 10% of leads convert to qualified prospects * 25% of qualified prospects convert to qualified sales opportunities * 50% of qualified sales opportunities convert to closed customers/revenue * you can even have a conversion ratio for additional sales to existing customers as a metric

Once you have accurate sales conversion ratios, you need to know the average sales cycle length and the average deal size. Marketing should be responsible for the lead gen conversion ratios above the sales funnel; they should be able to predict based on historical evidence the leads that they can generate from their various lead gen campaign investments. Assuming you have all of those metrics and they are accurate, you can plan what lead gen campaigns, how much of the mix and when you need to do them to produce enough qualified sales opps to produce the revenue the company needs.

When sales funnels work and are accurate, they are a thing of beauty. I was VP of Sales at an established company and 6 weeks in to every quarter we could look at our sales funnel and know that we would close 28-30% of the qualified sales opportunities. The good news is that our forecasting was very accurate. The bad news is that by the time we could accurately predict what that quarter’s revenue would be (i.e., 6 weeks in to the quarter), it was too late to back up and generate new leads and allow enough time for the sales cycle to make up any revenue shortfalls. That leads to end of the quarter discounting and trying to commit heroic sales acts, such as closing a deal a quarter or two before it would naturally close without the customer having the same sense of urgency.

The problem is for a start up there isn’t historical data to base your sales funnel on. The other challenge is that the market tends to be very dynamic so what worked last year may not work this year or works at a very different conversion ratio. Has the definition for a sales funnel changed? I would submit that the high level definition for a sales funnel hasn’t changed but that the dynamics of a sales funnel has changed dramatically. Specifically, you need to figure out how to engage prospects effectively much higher up in the cloud and nurture them. It is a huge sales & marketing problem/challenge these days. As much as sales would like to believe that it’s a marketing problem, it is a joint sales & marketing problem.

Well, who had the audacity to change the sales funnel? The answer is the market did☺ Buyers are now researching, evaluating and making decisions far differently than ever before. They can easily avoid sales interaction and they do. With the proliferation of free content everywhere (web 2.0) that allows you to interact and get information without having to speak to a live person, companies and buyers are doing exactly that. This new dynamic is further complicated by the fact that most companies do a poor job of messaging, differentiating and conveying their value proposition. Due to this, it only motivates the buyer to try to avoid engagement with sales reps at all costs because they are not perceived as adding value. Rather, the sales reps are viewed as adding confusion and pressure to their evaluation and decision so the buyer will try to avoid them at all costs. Also, most companies don’t do a good job of developing valuable content and then leveraging it to engage with the prospect.

The post Who changed the sales funnel? first appeared on True Sales Results.

So, what are the top deadly sins to look for in a highly dysfunctional sales & marketing relationship? Read on and I will share my personal experiences:

1. Marketing is measured and rewarded on leads not revenue- How can you have alignment if the two groups are focused on different goals and results? The simple answer is that you can’t. The beauty of measuring and aligning marketing and sales purely on revenue is that you save a ton of time that is constantly spent debating the definition of a lead:-) At the end of the day, it doesn’t matter to sales people if marketing is generating 1000 leads or 1 lead. What does matter is that marketing is helping to provide the necessary air cover and finding the right leads that turn in to real opportunities which get converted in to sales.

2. Marketing is not held accountable- Many years back, I was a passionate sales director meeting for cocktails with an equally passionate marketing director that I worked with. He is one of the most exceptional marketing professionals that I have had the pleasure of working with. As a general rule, when I find people that are exceptional at what they do I tend to find ways to work with them again as evidenced by the fact that the aforementioned marketing gentleman and I have worked together at 4 different companies thus far and counting! During our cocktail conversation, he expressed tremendous frustration at not feeling appreciated by sales. He did work very hard at trying to understand what our needs were and help support them through his team and their efforts. He actually thinks very much like a sales person which is one of the reasons why he is so good at what he does. I explained that one of the things that always separated sales and marketing was the level of accountability that sales people were held to versus marketing. Sales people live in a quantifiable black and white world whereas marketing tends to live in shades of gray. Sales people have to meet and exceed certain revenue thresholds or they lose their jobs. What is the average tenure of a VP of Sales versus a VP of Marketing? How long are mediocre people tolerated in sales for? Marketing tends to have squishy goals with lots of caveats. Sales isn’t afforded that luxury. One of the best things that a company can do to foster better alignment between sales & marketing is to establish clear goals for marketing and hold them accountable. I trust that you will find sales “appreciating” marketing a lot more when they are measured and held accountable in the same ways that sales is.

3. Marketing does not spend enough time out in the field- One of the biggest frustrations for sales people is that they are on the front lines every day talking to prospects and customers. Sales people know what their competitors are doing that are winning deals. They know what the customers want in products and solutions that are missing in their products and costing them deals. Sales people know what the general market perception is of their company and whether they are known or not. Marketing needs to proactively go out in the field with sales and learn firsthand how they can better help support sales to sell more effectively. Most marketing folks tend to be viewed as “ivory tower” types that very rarely leave the office and spend quality time in the field in front of customers. To compound matters, these are the same types that constantly represent that they know what the customer wants or what the competitor’s tactics are. That information is typically outdated and undermines their credibility with sales.

The post The top 3 deadly sins in dysfunctional sales & marketing first appeared on True Sales Results.

What’s common about a lot of these?  Generally it’s a marketing company tackling the issue from a mainly marketing perspective.  In other words, somewhat too ‘influenced’  by the holder of the pen.    The approach of “lets tell sales about alignment” is in, our opinion, not as successful as the “lets cough together” approach.  This is just as hard to do as it is potentially humiliating.  My sales colleague and  I debate continually about how to approach this issue for any client, and I guess that’s the ultimate key to success; constructive communication, probably with lots of conflict thrown in for good measure.

Not that Marketo or Eloqua advice is bad.  In fact it’s very good.  I am much more wary of the literally hundreds of web and public relations companies that want to teach me how to log on to Facebook yet have no clue whatsoever about how to link communications to demand generation and sales conversion.  Don’t get me going.

So we thought, as a real hybrid sales and marketing alignment company, why shouldn’t we give it a go?   CSO Insights agreed.  Why not discuss how social media has impacted alignment at the same time?

So we are proud to announce our white paper: “ALIGNING SALES & MARKETING IN A SOCIALLY NETWORKED WORLD”.  You can get it from CSO Insights here.  And, we’re not ashamed to say, if you want to talk turkey about how we could help your company with this issue, in a manner that brings together pure sales with pure marketing expertise, give us a call right now (hint:  use the web connect buttons on the bottom right of your screen).

The post Lets all cough together: our prescription for sales and marketing alignment. first appeared on True Sales Results.

Context doesn’t exist in a spreadsheet cell. It doesn’t appear as a footnote in a Salesforce.com report. Context is nowhere to be found in benchmarking metrics. Yet context is the most vital factor in every formula, because without it, you are operating in a vacuum. You are making decisions devoid of the most important dimension, which is what I refer to as ‘business reality’.

Harkening back to my college days, I was struck by what my Statistics II professor would always tell us; “You can make statistics say whatever you want them to. You can make statistics lie.” I recall being very confused by that notion and approached him after class to ask him what he meant by that. He told me that all statistics are predicated on samples. And that its quite easy and common practice to manipulate the samples to support whatever assertion you are trying to prove with metrics that do. He further explained that statistics and metrics are used and cited as the basis for making virtually every decision made in the world, yet no one bothers to question the samples used to generate the statistics in the first place. He ended the lesson by saying that the vast majority of statistics are not accurate because the samples used were not statistically relevant in the first place.

This lesson and business reality was further driven home with me when I worked for a large, prestigious market research firm in Boston during college. I ended up becoming a manager and got involved in the creation of surveys and focus groups that we would use on behalf of our clients. All of the market research was supposed to be objective and accurate. Our clients would pay us big bucks to conduct the market research and they were mostly blue chip Fortune 1000 companies that we were working with. Here’s the dirty little secret, we tailored the surveys to elicit the responses that were most favorable to our client. We doctored the results by ‘selectively’ including in the survey results the responses that our clients were looking for, rather than all of the survey results that would skew the outcome and possibly show our client in an unfavorable light with their customers or markets. This was done intentionally and as I learned, completely common in the industry.

It would be analogous to looking for a doctor that would only tell you that you look great, don’t need to lose any weight and shouldn’t cut back on your caffeine or alcohol consumption. Everyone laughs at how absurd that sounds but most people prefer the Hollywood ending rather than the reality of the world. It’s no different in the business world. I’ve been in sales and sales management for over 20 years in my career and it never ceases to amaze me how many people don’t look for the context or meaning behind the data and metrics. Most seasoned sales managers simply have a visceral sense when the data or metrics are wrong and most tend to be proactive about getting the context before citing or using any data for decision purposes.

How do you get the context behind the data? You ask smart questions to the people that are creating the data in your systems of record like Salesforce.com. Is ‘all’ the data being entered in to your systems of record? Is it being entered objectively or subjectively? Are there things happening in the real world that can explain vitally important trends that simply aren’t captured in the data or metrics? Are the system of record rules of engagement well understood by everyone that uses them and are they applied consistently? My experience shows that most sales teams and companies do a poor job in this area, and yet they are the first ones to cite reports, metrics, stats and reference spreadsheet formulas as to how their business is doing.

It’s like the old United Airlines commercial where the company has lost touch with their market and customers. The grey haired CEO passes out airline tickets to all of the execs around the conference room table and tells them to get out there and visit their customers. Don’t lose touch with the real world; you need to talk to your field sales people and customers to find out what is really happening out there. Don’t get lost in spreadsheets and metrics because without the context or meaning behind the data, you most likely have flawed assumptions that you are basing your business decisions on.

We help companies improve their sales conversion rates or effectiveness. As part of any audit engagement, we look at both the data and the context behind the data. Typically, we glean far more insight from conversations with sales reps and customers then we do from the Salesforce.com reports or spreadsheets. In fact, we commonly find embarrassing flaws in the metrics that are being used to make the business decisions through the context. So get out there and find the context behind the data, you’ll be making informed decisions when you do!

The post The Context Behind the Data first appeared on True Sales Results.

I’ll paraphrase the story by saying that a simple-minded gardener (Chance Gardner) is thrust in to the outside world and through chance is hit by a very wealthy business executive’s car. The business executive’s wife feels guilty and takes him home with her to heal when she learns that he doesn’t have a home.

This is where Chance Gardner meets the terminally ill business executive who has powerful political connections, including the President of the United States. The abridged version is that Chance enchants all of the high-powered people that he meets, including the President, with his simple responses to their questions that are perceived as being incredibly profound and insightful.

The obvious irony is that Chance’s entire education and real world experience consists of watching television and repeating the sound bites that he has memorized. He is oblivious to the real world and has no real world experience or original thought.

Which brings me to the point of this blog post, do you know a ‘Chance Gardner’ consultant? Or worse, is your company paying one now? There are no shortage of ‘domain experts’ out there today pitching their services to help you and your company. These consultants and their service offerings are available in every imaginable size, shape and color.

They’ll spout forth on how they can transform your business, impact your revenues, and increase your sales effectiveness all without even having asked a single question about your business. They might ask questions but they are rhetorical in nature and they are certainly not insightful questions.

Their pitches will be chock full of buzzwords, acronyms and the ‘hot’ industry stats and metrics. They’ll charge you lots of money to tell you what you need to ‘do’. However, they won’t actually ‘do’ any of it.

Why? Because they don’t know how to actually do what they prescribe and they are afraid of being accountable for the results. They can always point the finger at the execution failure as the reason the initiative failed, which exempts them from any culpability.

Here is a vetting process to help you avoid falling prey to the Chance Gardner consultant: • Dig deep to find out their real world experience delivering successfully on execution • How many times have they done it before? • 
How recently did they do it last? • 
Are they willing to put ‘skin in the game’ based on the results? • 
Are their proposals filled with fluff (strategy and theory) or substance (real outcomes, tangible deliverables, and concrete milestones)? • 
Do they truly understand your business needs and pain? • In their SOW, have they tailored their solution to meet your needs or does it have that cookie cutter feel to it? • Are they asking smart and insightful questions? • Is there any original thought in anything they say or do? • Ask about projects that they have failed on and why? Look for accountability in their answers!

In closing, be wary of anyone that suggests that they walk on water like Chance Gardner appears to be at the end of the movie:-)

The post Do You Know a ‘Chance Gardner’ Consultant? first appeared on True Sales Results.

The post B2B Sales Cycle Insight first appeared on True Sales Results.

Some call this permission-based marketing, some call it content-oriented marketing, some still call it e-marketing or even  lead scoring or nurturing if it’s a big company with thousands of clients  .. some even call it spam.  Powerful it is (as Yoda would say) and Marketo is one of the top companies.

Putting together complex landing pages which drive outgoing and incoming email-linked campaigns is the matter of a relative blink of the eye using their interface.  This said interface is the ‘iPhone’ of marketing automation …the most highly designed by far. Automator-like smart lists, instant drag and drop landing creation of forms and pages, complex flows and interactions and triggers that generate thousands of personalized emails and sneaky little alerts when someone is caught clicking, reading or requesting.

As a leading company in this business, Marketo is obviously also an active emailer.  Hardly a day goes by without getting an email from Marketo; “5 tips for lead nurturing!” “The definitive guide to content marketing!” “Make your email more deliverable!” And the latest “Revenue Cycle Analytics” which is the art of … actually I am not sure what it is exactly the “art of” as sales people are the people who really sell in my book in the B2B world.

So, why this article?  One simple thing.  Please, Mister Marketo – update your interface!

So why, after all this love-fest, am I whining?  Because lost in the Marketo loveliness and revenue generating claims they seem to have forgotten a few basics, and they seem to be so in love with themselves I don’t see them looking for feedback.

So please get back to some basics please! Do some upgrades your fancy interface .. please!   It’s like an iPhone with a call button that requires you to press six other buttons first.

For example .. who ever got the dumb idea that a lack of activity filter should be a double negative?  Where is a simple Eastern US States filter?  Where is an easy volume de-duping tool?  Where is an easy ‘only export clean data’ filter?   Where is the ability to turn annoying approval buttons on and off at will so that I don’t have to reapprove everything over and over again if I don’t want to?  Most importantly, why do I have to remember to link and relink everything together (the email, the landing page, the form, the workflow email, the smart list and so on) just to send a simple email campaign!    Even Microsoft now knows what Apple knows .. increasing integration between functions is a goal.  To create an email campaign is actually harder with Marketo than many other tools with a fraction of the UI investment.

Enough of the rant.   Please update your interface Mister Marketo.

The post Never mention the revenue analytics, mind the basics Mister Marketo first appeared on True Sales Results.

2. Tell an Interesting Story- People love a good story. It has to be captivating and engaging. It’s also fun to tell a story with a twist that catches the audience by surprise as everyone likes to fast forward in their brain and guess the ending.  The story has to be succinct and clear to understand. Good storytellers (aka-presenters) build to a crescendo and close the story with a climax.  The story should have a point or lesson, and the point of your story is an illustration of what you are trying to convey in your overall presentation.

3. Interact with the Audience- No one likes being lectured to. The fastest way to lose an audience is to give a long, dry monotonous speech. Ask insightful questions, give pop quizzes, polls, surveys and then share facts related to the key topic. Think of clever ways to get the audience involved and interacting, it’s an essential ingredient for presentation success. Ask for feedback after the presentation and always extend an invitation for individual dialog for anyone that’s interested.

4. A Meaningful Conversation Between Two- Whether you are presenting to one person, hundreds or thousands, you should always try to visualize that you are conducting a meaningful conversation with one person in the audience. And that you are speaking directly to that one person and they are incredibly engaged in the conversation.  That visualization process helps you focus your presentation.  Your presentation and key topic is exactly what they are interested in. Even to the extent that you answer hypothetical questions that someone who is really interested in your presentation and subject would ask.

5. Have Fun!- The best presenters genuinely appear to be having fun during the presentation. The truth is that they probably are having fun because it’s rewarding and enjoyable to engage an audience and get positive feedback; whether you are a singer, a comedian or a sales person. Smiles and laughter can absolutely be contagious. When you are having fun as the presenter, it sets the tone for the audience that it’s okay for them to have fun to. In fact, good presenters may insist on the audience having fun!

The post To Present or Not to Present: 5 Tips for Engaging Your Audience first appeared on True Sales Results.

http://blogs.hbr.org/cs/2011/09/selling_is_not_about_relatio.html

The post first appeared on True Sales Results.