If you’re in a B2B environment, you’ve undoubtedly noticed the changing behaviors of your customers in recent years. As a result, technologies have shifted their focus to get closer to the customer and I'm not talking about just CRM or SFA. With a flurry of acquisitions and new entrants to the CPQ market popping up regularly, we decided to tighten the aperture and evaluate the top 11 CPQ vendors in The Forrester Wave™: Configure-Price-Quote Solutions, Q1 2017. These vendors do the most to address the rising, empowered B2B buyer. Below are some of the key findings from the report:
Customer and buyer experiences become a priority. CPQ is not about engineers. It’s not even about sellers anymore. CPQ is about the customer, and in this case that means both the end buyer of your products and the customers of your technology (indirect channels selling on your behalf) expect easy and effective interactions. CPQ is now a key enabler to delivering a high quality customer experience.
CPQ has no channel limitations. CPQ is not, I repeat, is not a back office solution anymore. It’s long addressed the needs of front line sales reps, and now it extends its functionality to all available channels. This means companies can extend the same business rules and logic to indirect channels (i.e. partners, dealers, distributors, etc.), customer service reps, eCommerce sites, and even emerging channels like IoT devices.
CRM technologies are more than two decades old. In the early days of CRM, companies leveraged these solutions to provide "inside-out" efficiencies - operational efficiencies for sales, marketing, and customer service organizations. CRM aggregated customer data, analyzed that data, and automated workflows for front line personnel. Companies could easily argue business benefits by measuring operational metrics that were important for the company - like reducing marketing costs, increasing revenues from salespeople, decreasing sale cycle times, better pipeline visibility, decreasing service resolution times, and more.
Today, being successful at CRM builds on yesterday's internal operational and extends the power of these solutions to better support customers through their end-to-end journey to garner their satisfaction and long-term loyalty — a “customer-first” or “outside-in” perspective.
Our data at Forrester shows that good customer experiences correlate to customer loyalty. And loyal customers are more willing to consider another purchase from a company, are less likely to switch business to a competitor, and are more likely to recommend to a friend or colleague – all dimensions that have a direct impact on top line revenue.
Welcome to my Forrester blog. My career has been a blend of business strategy and technology, whether it was preparing people and processes for new technology eras as a consultant or diving deep into the technology while working in business operations and application development for a CRM vendor. What may surprise many of you reading this is although my blog is new, I am not new to Forrester; I’ve been with Forrester for close to two years working with Application Development & Delivery leaders as an Advisor with Forrester’s Leadership Boards. In that role, I worked directly with 50+ enterprise-level leaders from across all verticals to help define their customer-obsessed strategies and identify the best and next practices to give them a competitive edge. It was this connection with clients around solving critical business problems and using technology to gain an edge that attracted me to research and more specifically, diving back into the world of CRM.
Understanding agent attitudes toward their insurance carrier partners is crucial in earning independent agent loyalty—and driving sales. Why? Because despite predictions that direct-to-consumer insurance sales would doom the insurance agent, nearly 20 years after the advent of online insurance selling, millions of consumers and small businesses continue to rely on their local insurance agencies. Consider that when it comes to their agents, US consumers:
Buy from. Even after all that money direct insurers spend on TV ads, consumers are still buying from insurance agencies. In a survey of 10,000 online Americans, we found that 84% of home insurance buyers stated that they bought from an agent; 82% did the same for their car insurance, while 57% of life insurance buyers said that they did.
Trust in. When we asked in the same survey about attitudes toward financial services providers, more than 70% of life insurance buyers and about two-thirds of non-life insurance buyers we surveyed agreed with the statement “I completely trust my agent”. And that trust runs deep for some customers, especially for 25-34 year olds we surveyed.
Stick with. And after buying from an agent, consumers tend to stick with their them We asked US online adults how long they had been buying certain coverage from their agents. The average relationships with their auto, home, and life agencies were 12.9, 12.5, and 16.3 years Consumer steadfastness with an agent is often longer than that loyalty to a spouse: the average American marriage that ends in divorce lasts eight years. And no surprise, the tenure with direct insurers is much shorter than that with agent-centric insurers.
For two days this week, I enjoyed Hubspot’s Inbound 2015 conference. Hubspot is an inbound marketing platform targeting small to medium-size businesses and each year the company holds a conference bringing together thought-leaders, customers, and partners. This 3.5-day event has over 250 sessions spanning a myriad of topics. Conferences provide different perspectives on the marketing landscape, customer success stories, product updates, philanthropic awareness, networking opportunities, and — my favorite — kernels that can be developed into themes with broader implications. I was happy to experience all those elements and walked away with more than a few kernels with broader implications. I’d like to share a few resulting from comments by Brian Halligan and Dharmesh Shah, Chris Brogan, and Mitch Joel. Let me forewarn you, these ideas may seem provocative, but they make for a good debate and even better research.
The wild west of mobile in insurance is getting tamed. Mobile is no longer just a fun experiment—it’s now a crucial element in the customer and agent experience. We first published our mobile insurance metrics report in August of 2013. At the time, we were struck by how dependent insurers were on a single metric to prove their mobile success: Application downloads.
With 15 more months of mobile development chops under their belts, in November, we decided to take a look at how much more sophisticated mobile insurance strategists had become in their mobile performance measurement strategies. The answer? Unlike other industries where mobile metrics have grown up, insurers remain stuck in mobile adolescence. How do we know? Because topping the mobile insurance metrics list in 2014 are web traffic and app downloads. Fewer insurers are tracking metrics that measure real business outcomes like conversions and mobile revenue transactions.
A new and pernicious myth as taken hold in many B2B Sales and Marketing organizations. The myth - that buyers are 60-70% of the way through their buying cycle before they talk with a salesperson - is an intentional fallacy based on a false generalization that “buyers” means “all buyers”. Search the web for phrases around this topic and you’ll find a substantial volume of vendors selling the myth as truth, much to their short term benefit. In my discussions with both vendors and practitioners (leaders in Sales and Marketing), it is disturbing when they throw out the "60-70% ..." statement as if it were "fact" when, in reality, it is not only false but damaging to the revenue engine of companies who sell in the B2B space.
Not All Buyers Know What They Need
Our point of view is that not only are there different types of B2B buyers (we've identified four categories we call archetypes), but that in today's economy there are multiple buyers involved in decisions and they operate in what we call agreement networks. Some of these buyers - especially most executive buyers - want help in understanding complex problems in their business (including “unrealized opportunities”) before they ever think about products. They may not yet be aware of a problem they are faced with, or they may know that they have a problem but don’t yet understand its patterns or implications or impact on their organization. They are (appropriately) weeks or months away from a search for a product or service. It is these buyers who set the direction, before asking others in the agreement network (e.g. their teams) to get deeper into the details, including acquiring solutions.
In a recent post, I introduced on a common scenario that sales leaders encounter whereby the CEO asks the chief sales officer to substantially add salespeople to the sales force to grow the bottom line. We see this strategy repeated over and over again and, unfortunately, it very frequently leads to deeply disappointing results for the CEO, investors, the board of directors, and the sales leader. Growing the sales force to grow the bottom line seems to make common sense, right? Well not exactly. Here’s why.
What is the desired impact of adding salespeople?
First, let’s look at what impact the stakeholders envision with the “add salespeople” strategy. Driving increased revenue and bottom line growth is anticipated from more salespeople acquiring more new customers. These representatives may be deployed in new geography to broaden the company’s footprint, or they may be added within the existing footprint where, with more salespeople, the company can reduce the number of accounts per salesperson with the expectation that those reps will invest more time with each buying customer to sell more offerings (cross-selling) per company.
Why doesn't adding salespeople produce increased revenue and bottom line growth?
There are really three factors for why significantly increasing the number of salespeople often doesn't result in expected financial growth. These are:
Unrealistic timelines associated with the expected results
Unanticipated expenses with adding and supporting salespeople
Your CEO just gave you your marching orders. “We’re going to organically grow the top line and profits by 30% over the next year. We’re going to grow the sales force to make this happen. I’ve discussed this with the Board and they agree with the strategy. So tell me what you need to accomplish this and let’s move forward.”
As a sales leader the opportunity to rapidly grow sales seems exciting. You’ve got the backing of the CEO, and the Board of Directors. You’ve got air cover. You’ve got a mandate. This is the stuff that great success stories are written about (and great resume’s), right? Yes it’ll be hard work, but you can just envision a year from now when your boss recognizes your success in growing the business on a big stage.
As the Chief Sales Officer, one of two options is now available to you.
Your boss, the CEO, told you to jump and you answer “How high?” You’re going to do exactly what your CEO told you to do. So you gather your management team and enthusiastically communicate the challenge and opportunity ahead. They’re all for it and will help rapidly put the plan together. You talk with your counterparts in Human Resources, Training, and Sales Operations (who will coordinate with Facilities and IT for the required resources). They’re all behind you (after all, this comes from the CEO). A week later, you present your formal plan to the CEO and tell her that interview scheduling is already in process. You’re on your way to growing sales and being a visible leader in a great success story.
The words of "War," Edwin Starr's 1969 Motown classic, began ringing in my head this morning. It was brought on by a Harvard Business Review blog post by Steve W. Martin, "Why Sales and Marketing Are at Odds — or Even War." Within tech vendors, sales and marketing teams often fail to communicate or align go-to-market strategies. Forrester's sales enablement visionary Scott Santucci discussed the different languages of sales and marketing in his blog over two years ago. As for my own experience with sales and marketing:
A few years ago, I sat with the chief marketing officer and chief sales officer of a Fortune 100 tech vendor. The conversation didn't focus on customer problems, which should be the starting point for sales enablement professionals. The conversation didn't focus on sales efficiency issues such as sales cycle duration or win rates, which should be critical imperatives for all sales and marketing professionals. Each of these executives controlled massive budgets but neither one sincerely trusted the other. Their words were about aligning sales and marketing programs, but the real conversation, when read between the lines, was about control, boundaries, and politics. They were at war!