Beware The "Buyers Already Know What They Want" Myth

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.  

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To Win Against Increasing Competition, Equip Your Salespeople With A Deeper understanding Of Your Buyers

Last week I spoke with the VP of Sales for a tech company that used to have the hottest product in his market.  In housing terms, they used to be an exclusive and much sought after neighborhood, but now the competition has moved in on all sides and sales are down.  His sales force is facing a vastly growing number of competitors. Some are much larger and have broader portfolios that give them better presence in customer accounts. They’re getting squeezed and are finding it harder to compete in deals where they used to be the only solution.

Your only true differentiation comes from how your reps interact with your buyers

What’s interesting is that the vendor mentioned above is still experiencing consistent success when his company’s salespeople gain access to executive buyers early in their decision process and work in a consultative manner with those buyers to shape a vision of a solution.  When that happens, salespeople are confident discussing the business issues faced by those buyers.  They’ve found certain industries that they know well where they are able to do this consistently.  They are not getting squeezed by competitors and they are winning. But often, they're chasing deals that competitors started and reps are drawn into an RFP frenzy that chews up time and resources.  After all, they used to win these deals, but now they're pretty demoralized and reps are starting to leave.  

It's all about empathy for buyers

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Sales Experience — An Obsolete Hiring Criterion

Sales Managers Err In Biasing Toward Years Of Sales Experience In Making Hiring Decisions

Thousands of sales managers, and the human resources (HR) teams that support them, consider years of relevant sales experience to be a key criterion for recruiting and hiring salespeople. In the new economy, however, sales experience is an unreliable indicator of future success versus another key characteristic. In fact, assumptions about sales experience that have guided sales hiring for more than a hundred years should be discarded in the age of the customer, in which buying dynamics have radically changed.

Successful sales managers, now, will focus on hiring salespeople who are best able to deeply understand their customers and align with their buyer's communication needs and preferences, as opposed to their product or vendor-industry expertise. Buyer empathy may be found in highly experienced salespeople or developed in inexperienced salespeople.

Sales Experience Is Not An Inherent Advantage For Engaging With Executive Buyers

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Sales Leaders Are Ignoring An Effective Strategy To Gain Access To Executive Buyers

In our research, executive buyers tell us that referrals are far more effective than other approaches for gaining access to them. Yet the referral strategy is ignored in most corporate sales organizations. If you want your salespeople to have greater success accessing executive buyers, then it’s time to consider this important yet forgotten strategy.

What Is A Referral?

In his recent report, “The Lost Art Of Referrals,” my colleague Norbert Kriebel defines referrals as: 

“A message strategy to transfer the value of your offerings from an existing customer to another; the existing customer is ‘vouching’ for you.”  

This report notes and describes four basic sources of referrals:

  • From a colleague in the company.
  • From a colleague outside of the company.
  • From a subordinate.
  • From a superior.
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What Do Reps Believe Makes A Meeting Successful?

Do salespeople in different roles (e.g., strategic accounts, geographic, inside sales) and with different levels of experience have different perspectives on selling? Not significantly, according to our Q1 2012 North American Technology Seller Insight Online Survey.

Our recently published report “What Do Reps Believe Makes A Meeting Successful?” illuminates how similar the perspectives of sellers in different roles and with different levels of experience really are. If your company has one kind of sales role and one very consistent type of buyer, and they are well aligned, then this data may not much matter to you. But if you have different roles and types of buyer, then it’s worth examining the data in this report.

We found that three-fourths of salespeople agree that the most important aspect of a successful meeting with prospective buyers is their ability to understand the buyers’ business issues and share a way to solve them. The thing is, Forrester’s Q4 2012 Global Executive Buyer Insight Online Survey data, and interviews with executive buyers, clearly illuminate that the majority of buyers believe that salespeople are not successful in meetings with them. 

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Your New #1 Competitor

Who is your company’s Number One competitor?  Actually, it’s not who you think it is. In fact, it’s probably not “who” at all, but rather “what” that is taking away the most sales from your sales team(s).

We recently asked 180 IT salespeople with greater than three years of experience this question: “Thinking about the opportunities you’ve lost in the last 12 months, what is the most common reason for the loss?”  They replied that in 43% of losses the reason was “Lost funding or lost to no decision: customer stopped the procurement process.” 

 

Your Real #1 Competitor

Your company’s “competition,” more often than not, is actually buyers deciding not to make a decision at all.  You lose to a “no decision.” Your perceived competitors didn’t win either.  No transaction happened, no value was created; only cost was incurred by all parties involved. OK, so is this really a "new competitor."  No.  However, due to changes that I'll discuss below, it is a competitor that has gained far more of a foothold on business that you would like to have.  So what happened?

 

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Where Have All The Good Times Gone? The party is dying out for companies whose salespeople lack empathy for executive buyers

In his recent report, Competitive Strategy In The Age Of The Customer, Forrester’s David Cooperstein notes that in regard to successful business strategy:

It's no longer sufficient to say that you are simply ‘customer-centric" or "customer-focused.’ The only successful strategy in the age of the customer is to become customer-obsessed — to focus your strategic decisions first and foremost on how your customers expect you to engage them.

Through our ongoing conversations with executive buyers, professionals in sales enablement, and through survey responses from hundreds of global executive buyers, Forrester’s Sales Enablement practice has discovered a massive gap between buyers’ expectations of salespeople and what they’re actually experiencing when they meet with reps. In fact, less than 40% of executive buyers say that meetings with salespeople meet their expectations (see figure 1).  Further, only one in three IT executives said that sales meetings "usually" live up to expectations, and just over two of five business executives said that sales meetings hit that mark (see Norbert Kriebel’s report: Executive Buyer Expectations — The Bar Is Low).

 

Do meetings with salespeople meet executive buyer expectations?

Considering that perhaps 25% or less of the typical sales force is even capable of gaining access to executive buyers, consider the cost when these meetings miss buyer expectations and result in no further opportunity.

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Understanding Value for Buyers in Complex Sales

Who do you sell to? That’s a simple question that we’ve asked thousands of salespeople over the past few years. The answers are always interesting and typically focus on either a description of a business segment (e.g., “I sell to Financial Services companies of over $1 billion in revenue”) or a business function (e.g., “I sell into IT security departments”). 

It is infrequent that salespeople tell us about selling to a network of decision-makers who are involved in making buying decisions for their organizations. Yet what we call “agreement networks” are the reality of a shift in how companies buy today.  Agreement networks have forever changed the rules on salespeople, requiring new levels of understanding of how multiple buyers perceive value during their buying process.

Why is selling getting more complex?

  • Business problems involve an interconnected web of domains and processes
  • Selling into an agreement network involves multiple people
  • Agreement networks require multiple “sales”
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Why Growing the Sales Force May Not Be Your Best Investment Strategy for Revenue Growth

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 
  • Unanticipated risks
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The CEO Says Hire Salespeople! What's Next?

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.  

Option #1

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.

Option #2

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