Marketing & Sales, Chronic symptoms, wrong treatments
Why are the sales numbers down? Alternatively, why are we not hitting the targets? A couple of common questions in the sales universe. More importantly, what are the answers to those questions, and is it the right answer?
Too many questions, but being in sales for 15 years, I can confidently say the answer is straightforward, and a smart management could figure it out and even stop asking. However, why do sales numbers suffer? We could sum up five main reasons:
1- Lead generation: Businesses need higher-quality leads, yet rarely do marketing and sales define the characteristics of high-quality and low-quality leads. How can people pursue high-quality leads if they do not know what one looks like? Leads are usually evaluated mainly by salespeople using their experience and intuition. Alternatively, they are “evaluated” after the fact—a good lead is one we could close, and a poor one is one we could not close—and it stops there.
2- Follow-up: Companies spend thousands of dollars generating leads (good and poor). Then, those leads are forwarded to sales reps or distributors without requesting or receiving any feedback on the action or outcome.
3- Communications: Even when marketing and sales report to the same senior executive, they typically are managed separately. The result? Poor communication, incomplete handoffs, turf wars, resource competition, and confused or stranded customers. Marketing is rarely held accountable for producing revenue, while sales are held responsible for little else (often not even for bringing profitable business at a reasonable cost).
4- Sales support: Most salespeople are left to work independently. How often have you had to write your sales presentations, brochures, mailers, and ads because the marketing materials were useless? Salespeople everywhere are fighting tooth and claw to make things happen for customers despite vigorous, wrong-headed internal efforts seemingly aimed at scuttling sales.
5- Other reasons: Here, we could bundle other forms of waste and inefficiency, like long sales cycles, low, close ratios, and too many sales going down to no decision. Moreover, sales “forecasts” and lack of predictable or measurable results from sales training, advertising, CRM, and product development.
These problems are so widespread that most marketing and sales professionals barely see them as problems but rather as “part of the job” or “the way things are.” Their resignation may be the most significant problem because these are indeed problems and, as such, can be solved only with dedicated effort and the right approaches. When these issues are persistent and damaging, they are usually rooted in the sales process—in one or more specific marketing, sales, or service activities—or in the information available (or not available) on those activities. Thus, these problems often point to issues in the sales process and a lack of information on what is and isn’t working. The fundamental problem is, therefore, twofold: inefficiency or ineffectiveness somewhere in the sales process and a lack of information on the activities within that process.
Marketing and sales managers have been conditioned, encouraged, and trained to focus mainly on sales figures. Meanwhile, management of the activities that generate the leads, opportunities, and sales tends to be haphazard.
Most sales managers rely far too heavily on the usual fixes:
Demand more marketing and selling activity—more leads, sales calls, proposals, and distribution channels.
Train salespeople in a new “selling system” or new selling skills.
Tweak the compensation or incentive system or hold a sales contest.
Reassign salespeople to different territories or accounts.
Replace the sales manager salespeople, or both.
Hire a new ad agency or marketing communications firm.
Try a new CRM system or other sales support software.
These initiatives work, but sometimes, in certain situations, one or more might solve a company’s sales problem. Decisions to employ these solutions are usually made with very little, if any, actual analysis. Without analysis of the problem, how can any of these represent a solution?
Managers decide which of these fixes to use based on gut instinct, their experience with what worked for them in the past, or their preference for a particular vendor. Managers foster sales contests and competitive ranking of salespeople, which discourages them from sharing successful sales tactics. It even encourages them to undermine one another.) They can lead to the Superman Theory of Sales in which management looks to a few “born salespeople” to carry the load. If all else fails, some companies try to use distributors or independent reps as their sales force rather than a channel, which rarely works. These beliefs also coincide with the view that sales are a numbers game.
Seeing marketing and sales as mysterious and uncontrollable, management focuses on results—How are this month’s sales? Are they better or worse than last year? Are we making plan or not?—rather than on the process that produces the results. In a sense, management tries to change the room temperature by talking to the thermometer. The metrics, such as they are, focus on the company’s goals, such as revenue, revenue growth, sales trends, and revenue per headcount. However, that focus tends to leave out the customers or reduce them to a necessary evil that exists to help us make our numbers. This misstep might undermine an outfit’s ability to find, win, and keep customers. Focusing on revenue results also undermines genuine efforts to change marketing and sales methods because change involves knowing what needs change. That, as we will see, requires analysis that goes far beyond the usual fixes outlined above.
So, what is the answer? We must ask the right questions first.
1- Where is the problem With the product? In the organization? In the marketplace?
2- What exactly is causing the problem? What is causing low sales, slow product adoption, withering markets, or weak responses to direct marketing efforts?
Answering these questions calls for understanding marketing and sales as a process.
Process thinking is the foundation of Six Sigma.
A proper sales process must include everything a company does to find, win, and keep customers.
Marketing finds customers, sales wins customers, and service keeps customers. Each of these three sub-processes consists of activities. Each activity produces a result that advances finding, gaining, and retaining customers.
The process should not be mistaken for the sales funnel. With the right sales process, marketing, sales, and service, people will be positioned to work more efficiently and effectively.
More about applying Lean Six Sigma to improve marketing and sales in future articles.
References:
Sales Process Excellence, Michael J.Webb
Sales and Marketing the Six Sigma Way, Michael J. Webb
Mastering your Sales Process, David Masover
