"Brain-Stem" Sales & Marketing Tactics

A common refrain: "Our marketing just isn't working. It's not generating enough qualified leads for the investment we're making. The person we've got running this is hard-working, but too 'tactical'..."

Of course the implication is that marketing needs to be more "strategic" -- and with it, the people running it. But this makes some people a little nervous too. They begin to have visions of (and a little nausea over) adding high-paid executives without direct quotas or ship dates, whose job fundamentally is to tell others what to do (build) and say (sell). It may well be that the problem is in fact "strategic": the wrong product, and / or the wrong market. But frequently there's a lot to be gained from a tactical tune-up.

Marketing is a process that's only as effective as its weakest link. Unfortunately, most marketing organizations are organized in stove-piped ways (product, corporate, and field marketing) that sometimes don't coordinate well, so the systemic effects of optimizing locally for each function, not globally for the process, are hard for people in the function to appreciate. And, it's rare for the top marketing person to have a portfolio of experiences that encompasses all three of these sub-functions prior to getting the top job, not to mention legitimate engineering and/ or sales experience to buy "cred" with those functions too.

This article presents a simple (hence "brain-stem"), actionable framework I've used in the past to establish new tactical programs and to tune existing ones. It's organized into five simple buckets of things to think about, with a few principles and heuristics to help assess whether things are working right in each bucket. Most importantly, it's cross-functional, so everyone in marketing, and beyond, can use it to understand the process and each person's role in it. The five buckets are Connecting Strategy to Tactics, Collateral Development, Customer Targeting, Channel Approaches, and Counting Results.

Connecting Strategy to Tactics

Step One in any marketing plan is to connect the highest revenue forecasts being made by management through sales plans for delivering those revenues to lead generation plans for marketing.

Since sales cycles sometimes span multiple years, so should your math. In one of my prior roles, we started by saying we wanted to double revenues in three years. So this begged the question, "where's that going to come from?" We looked at our portfolio of client relationships and broke it down into categories:
"anchors" for relationships that we thought would reliably deliver revenue consistently over the 3-year planning horizon (we called the really big ones "flagships"); "sprouts" for relationships where we were got a first big sale with the potential to help establish a consistent relationship; and "seeds" for relationships generating only initial, modest "get to know you" revenues, like fees from diagnostic workshops, or small-scale pilots.

We made assumptions about how many would advance, and how long this would take. And, we did some rule-of-thumb audits to check the validity of our assumptions, especially in the middle cases, to see whether a first, big sale could realistically lead to more, based on the size and performance of the client, and the nature of our relationships with people there. With additional assumptions about average deal sizes and yield rates on advancing from prospecting through seeds and onward, we backed into the universe of potential targets we'd need to go after and the effort required to do so. This in turn provided good reality testing for "strategic" ideas about which markets to target, and which channel partners to work through.

Collateral Development

Collaterals include things to "say, show, and sell".

Something to say means a description of the problem you solve, and what you've learned in the course of solving it. The purpose of this kind of content is to establish your expertise, since it's unlikely that your product exactly meets what customers want, and your understanding and credibility will need to help bridge that gap. "Something to say" takes the form of articles (both bylined and quoted-in), talks, blogs, and whitepapers. One lesson I've learned in developing collaterals is to separate the expertise from the sales pitch. Customers tune you out when they feel they've stopped learning from you and are being sold to, and they won't read what you have to say the next time. The key to making these separate but connected is having a simple, actionable, first-sales step that can be described in one sentence of a writer or speaker bio, or a short introductory phrase of an article (see "something to sell" below). Quick litmus tests for the effectiveness of your "say" collaterals include:

-What/ how much have you had to "say" in the past six months, and where have you said it?
-Who's quoting you?
-Who's using these collaterals, and how many times have they helped to advance a sale?

Something to show means tangible evidence of this expertise: case studies, customer references, market research, staff bios, product demos. A very telling "statistic" is the ratio of "show versus tell" in your firm's content, both in individual collaterals and in aggregate: less than two-thirds "show" should be a warning flag.

Finally, there's something to "sell". By this I don't mean the obvious, which is the ultimate product and a price, but rather a "gentle slope" set of offerings that allow a customer to get increasingly comfortable with the fit between his/ her need and your solution, and that give your salespeople something to "always be closing" with. This can take the form of an "ROI calculator" self-assessment tool, or a workshop, or a trial version of the product for testing and piloting. What do you have that takes:
-an hour and is free, but asks for a little information about the prospect that will be valuable;
-a day and asks the customer to at least cover out-of pocket expenses;
-a week with a fee that can be signed for by one person in the customer's organization?

Each collateral should be evaluated according to its substance and suitability for a particular setting.

In terms of substance, a framework for structuring content (whether say, show, or sell) I've found very useful is "PxCxVxF>R" (see http://salesmastery.com/docs/syllabus.doc), which I learned from CRM gurus Jim Dickie and Barry Trailer. P stands for Pain -- a problem a customer faces. C stands for Change -- assessing the degree to which the pain is sufficiently acute to merit doing something about it (I suppose it could also stand for Consequences -- what happens if something isn't done about it). V stands for vision -- how your solution addresses this pain, and what the world will look like after the solution is in place, which means not just the absence of pain but additional opportunities and benefits that will be realized. F stands for First steps -- what are clear, low-risk steps can I take to explore whether the V really is the cure for the P and the C. R means resistance -- what alternatives to your solution exist, what are their relative advantages and disadvantages, and what other inertia of active opposing factors block moving ahead?

I like this framework because it's simple, comprehensive, and memorable. Starting with P and C also reinforces the need to understand the customer's situation and needs deeply, which then helps to drive really good qualification questions: if PxC isn't sufficient to fund the solution, the lead isn't qualified, at least at this point. It also reminds you to frame the case for your solution in a way that your customer point of contact needs to make the case for deciding in your favor: comparing it against alternatives, and outlining clear next steps.

As for setting, I've found it useful to develop collaterals for specific "use case scenarios" by your staff. These scenarios have many dimensions, including whether the contact is inbound, chance, active/outbound, and referred or cold; whether the interaction directly involves a member of your team or is initially un-mediated (e.g., web site visit, reading about you in print); and, how far long the discussion is (10-second elevator answer to "so-what-does-your-company-do" through the "mutual qualification" (phone) conversations of a few minutes' duration, to the initial and subsequent in-person meetings).

Note that these usage scenarios and the collaterals to support them can be scripted as a series of linked conversations, where prior content and discussions inform questions and and imply agendas for future ones. It's this flow that is typically ill-served by the conventional walls within marketing and between it and other functions. I've used this artifact several times as the basis for FAQ collaterals, with good results; its users say it feels "real". (This conception of the process as a series of conversations is well-articulated in The Cluetrain Manifesto http://www.cluetrain.com/book/index.html, which I found compelling in substance, if over-the-top in tone.)

Customer Targeting

On one hand, you have strategic customer segmentation in high-level business plans. On the other hand, there are lists used for prospecting by territory reps, inside sales teams, and telemarketing firms. These are often disconnected. This is especially true once you get past the top ten company names in a given segment that are usually the focus of named account efforts. In one of my former sales management roles, where my charter was to build a national named-account strategy focused on new relationships, we developed an approach to try to bridge this gap. We called this approach "Top Ten, Next 40".

First, the strategy was premised on the reality that for products and services representing discretionary investments with price points "more than a minivan" (~$30k), the buying process was likely to be complex, take time (at least six months to develop an initial foothold in a tough economy) and involve multiple people. This meant that salespeople, if not quite farmers, would have to be patient and persistent hunters, well-armed with specific knowledge about a company and relevant material (see above) for that firm or at least for its industry. This in turn meant being local and focused. We had offices in three major cities: Boston, New York, and San Francisco. So in each city, we identified the top ten and next 40 largest firms to try to sell into.

Because we wanted to jump-start our new-client pipeline, we chose not to restrict our outreach efforts to focus on one or two verticals initially. The firm's experience was broad enough at that point that we could marshal examples of experience, and the people to go with them, in a number of industry segments. Plus, while it may seem rational to focus on segments with larger size and higher growth, when you go local this can reduce the number of companies to target to a number that's too small to yield a smooth flow of aggregate progress against the typical uncertainties of individual advances. We worked "verticalization" in parallel with the broader targeting effort, focusing resources for developing "something to say" out of our experiences with customers, as real opportunities emerged from the broader outreach efforts.

In retrospect I would change two things. First, while our customer "mapping" efforts (see below) were spread pretty equally, we focused too much research and cultivation effort, probably around 60%, on the "top ten" potential customers in each city. The top 20% of the customers targeted should probably get no more than 30-40% of the effort until progress merits further investment. Second, I would have accelerated a narrower vertical focus, even if targeting beyond local markets would have meant a higher cost to follow up individual leads. So "Top 10, Next 40" would be defined primarily by vertical, with resource allocation to individual cultivation influenced by location as a secondary factor.

But I think the one thing we did do right was to translate and maintain a connection between high-level plans and target lists. Tying the strategic to the tactical this way helped us to better understand customer needs and the competitive landscape in aggregate, and react to changes (such as the need to develop lower-cost programming capabilities) more quickly.

(Marketing) Channel Approaches

Broadly, there are three ways to establish and maintain a conversation and relationship with customers, once you've got the content developed and the target organizations identified. You can get in touch directly. You can be referred. And, you can hang out where customers do and connect "incidentally". All three should be going on at once, intensively, and be well-coordinated.

In terms of direct contact, efforts are traditionally divided between inside sales/ and or telemarketing on the one hand, and direct reps on the other. The idea is for the former to make calls, get leads, qualify and advance them as far as possible, and then hand them off to a direct rep to close. A common philosophy is to have the least expensive resources calling as much as possible, with the next-best result being a quick "no" so rep efforts aren't wasted on "maybes". This is fine where the pitch is simple, the buying unit and process is simple, and the universe of potential customers is large and largely un-networked.

In the businesses I've worked in these conditions are not present. Customers don't buy without 1) developing an appreciation of your firm's expertise in solving a problem it cares about and 2) developing trust that your rep will be an effective two-way broker of information. I've had better results with a different approach. In this model, the role of inside sales and/or telemarketing is to become a "customer research organization". Job one is "mapping" the people involved in the target customer's buying process, and who plays what role. Job two is figuring out the landscape of customer priorities and competitive presence. Job three is figuring out the buying process itself, including which budgets can be tapped and where budget cycles stand. In short, this "research" becomes "sales by other means":

"Hello", says your inside/ telemarketing rep, "I'm Jane Doe from XYZ Corp [or the telemarketing firm]. I'm doing research on behalf of XYZ Corp. on buying patterns for ABC needs in your industry. Who would be the right people to talk with, and how may I contact them? (Yes, we are vendors of solutions for these needs, but this is a research project, not a sales call, and we're happy to share the results of our research with your firm.)..."

As they say, "you gotta give to get." This approach is all about starting a conversation. Credit is given to the initial callers for meetings that can be arranged at target organizations in a given time-frame (say, a quarter), between sufficiently senior customer representatives and your direct reps. This is an objective standard that avoids the usual wrangling over whether a lead's really a lead or not. If it takes sharing "research" in a safe, anonymously summarized way, plus maybe a small donation the charity of the organization's or executive's choice, that's fine. I don't worry about qualification of demand at this point. What's important is getting a direct rep face-to-face with a very important member of the customer's decision-making process, to establish the relationship. Such meetings are never a waste of time (though phone v. in-person is sometimes a judgment call). If the window's open for a pitch, great, but the key thing is to learn as much as possible so that the subsequent conversation can be as tailored as possible to each customer's circumstances. This way, when the buying window does open, you will have an advantaged position.

What I like about this approach is that it lowers the bar for making the initial call successful. It makes the objective something mutually beneficial. It can give you a broader range of initial contacts (for example, the "right people" to talk with initially could come from multiple organizations). It sets up a great listening dynamic, where the "next-best result" isn't limited to "no" but may include valuable customer feedback. It opens the possibility to turning "no" into "not now", and informing "when might be a good time to call you for our next quarterly survey", crucially important when the universe of target customers may only be a few thousand at most. It helps to drive the "something to say" content machine ("Eight out of the last ten folks we talked with said..."). And finally, it helps to weave together what marketing and sales learn so arguments about "what customers really want" are resolved or avoided.

Referrals can come from a lot of different places, but it's funny how poorly supported the referral-generation process is given how powerful they can be. Diane Darling, CEO of Effective Networking, Inc. and author of the "Networking Survival Guide", cites research from the Sandler Sales Institute claiming that:
-"Only 1 to 5 percent of cold calls lead to a successful sale.
-"About 15 percent of referrals are successful when a name is given out...
-"The success rate leaps to 50 percent when a phone call or email is sent on your behalf.
-"It catapults to the high 70's and over 80 percent when the person who can make the introduction attends the meeting or phone call."

Even if they are off by a factor of four, statistics like these are why it's vitally important that your organization think in terms of individual maintenance of relationships and not simplistic bureaucratic responsibilities. For example, I recently introduced the former head of a Big 5 IT consulting firm practice to a senior sales executive at a small software vendor. The sales exec immediately fobbed the introduction off to the firm's director of alliances -- a fellow I don't know -- with an email. I'm sure of three things: the former practice head got a narrower view of the organization than he should have, the sales exec missed an important learning and lead-gen opportunity, and I look foolish to the former practice head for the behavior of the sales exec I introduced him to.

The power of this dynamic was behind our decision to deploy "enterprise social networking software" for intra-organizational employee referrals when I ran sales and marketing at an IT services firm, and the focus of my subsequent work at a small software startup in this space. With tools like these, not only do you raise the odds of a referral-based approach, but you also increase the chance of becoming better informed about a customer prior to an approach, and equally important avoid uncoordinated approaches to the same customer through different divisions or departments.

The same philosophy -- think about organizational support for well-coordinated individual relationships, rather than bureaucratic allocation of relationships -- should imbue outreach efforts through partners, and media as well (including analysts). (See this other article I wrote on partner relations and business development.) Analysts are an especially poorly-cultivated resource. Most firms consider getting "MQ'd" (getting into Gartner's "magic quadrant") a win. The real win comes from referrals through the analyst. You get those by pitching less, and sharing more -- not just knowledge, but presentation and interview opportunities.

Incidental contact as a lead gen source is often underestimated, because it's not often executed effectively. You can increase your odds of getting struck by lightning in three ways. First, you've got to go outside. Second, you've got to hold up a distinctive attracting rod. And third, it helps to hang out where and when lightning is likely to strike.

Woody Allen is famous for saying, "80% of success is showing up". Having found wisdom in other things he's said ("Sleeper" praised the dietary benefits of a high-fat diet more than thirty years before Atkins) I've applied the Woody Allen Rule wherever I've worked. This meant getting the staff ("everybody's in sales") out to as many free/ cheap professional events as possible, paying for cabs to get people there, and challenging each person to come back with at least one new business card and a bit of intelligence about what potential customers are doing.

Of course it distinguishes you to be a panelist or speaker at these events (which you can help yourself become by having plenty to "say and show"), but you can also increase your visibility mildly and network more effectively if you help organize or host events, or otherwise become active in associations. Thanking guests for coming, or asking for feedback on the food at the refreshment table, or better, asking for feedback on the event in a semi-official capacity, are all great ice-breakers to introduce yourself and your firm, and start a conversation.

Targeting obviously means choosing organizations that make sense for your business. But it also means things like asking for a list of registered attendees before you go, matching it against your target customer list, maybe contacting targets ahead of time to say you will introduce yourself, or at minimum scanning the room to see if you can meet representatives from your targets "accidentally".

How many people have gotten out to how many local events in the last month in your firm?

Counting Results

Conventional marketing management teaches you to think in terms of products and campaigns. In sales, results are typically tracked by rep, by measuring performance against quotas. But despite all of the talk about CRM, we don't often see any good measurement of "return on relationship", that is to say, an activity-based allocation of sales and marketing efforts and costs to the margins for customer segments, much less customers. And, since sales cycles can span multiple fiscal years, we don't necessarily allocate those costs to periods when a customer was not yet generating revenue. If I work a potential customer hard for two years and finally get a deal in the eighth quarter, the relationship may look artificially profitable if I don't allocate those acquisition costs appropriately.

I like to track these as early as possible -- before customers generate revenue -- and pragmatically -- tracking only the bigger costs, usually people, to customer- or segment-specific levels and spreading the infrastructure more arbitrarily. So if we do research on a sector to adapt a product or service for it (e.g., "Sarbanes-Oxley compliance for financial services) and then we call fifty firms to do the "research" described above, I want to track sales and marketing effort at firms where things go beyond the initial probe.

This kind of measurement doesn't have to be complicated, but it does depend on good call-report discipline and a simple way to track and tote up time and expense by customer.

Don't Forget

Sales and marketing are complex arts and sciences. This article does not pretend to minimize all of the subtleties that can significantly affect results. The idea here is to provide a simple "brain-stem" framework that allows us to see the big picture so the value of well-implemented subtleties is not lost.

copyright 2004 Cesar A. Brea