Recent headlines have declared that the economic downturn has hit bottom and that perhaps the recession is over. Unfortunately, we can’t all let out a big sigh of relief and watch business magically return.
Most middle market companies have cut costs to the bare bones, and then some. Many are still in a very tough financial position. It’s time to dig down deep and find ways to rev up the sales process and begin to grow the top line again while the economy normalizes.
The million-dollar question is how to do that in these challenging times.
One of the hallmarks of this recession has been the personal toll it has taken on this country. This recession did not just happen to some impersonal businesses, it is happening to everyone.
Fear came to the forefront and changed corporate America’s mentality. Everyone threw on the brakes. Companies immediately managed the bottom line and started laying people off, which had the cumulative effect of having no one left to buy.
Many companies reduced their sales staff and cut their marketing departments all together. The remaining staff was asked to do more with increased quotas in a tougher environment.
“Under this scenario a company starts to lose its human dynamic momentum,” said Kirk Hanes, CEO and president of Summit Performance Partners. “The ‘we can win’ attitude of the sales team turns into survival mode without motivation.”
The end result is even poorer performance and potential loss of your best sales people to a competitor.
This impact is even greater when a company lacks a clearly defined and well-supported sales process that uncovers customers’ pain points. The tenents of a successful sales process are consistency, accountability and urgency, said Jay Mitchell, founder and managing director of Motum.
“Without a defined sales process, each sales person sells differently,” he said. “The impact is a significant increase in risk of failure in the sales cycle. Compounding that, most sales people don’t differentiate based on the pain in the mind of the buyer, and as a result, they commoditize themselves and only compete on price.”
Left to their own devices, sales people will spend 40 percent of their time creating their own marketing materials, according to a CMO Council study. And marketing is busy creating materials that the sales people don’t use.
The American Marketing Association reports that 90 percent of what marketing creates goes unused. A tightly defined and managed sales process will create effective marketing messages and sales materials that the sales people will use, allowing much more customer “face time.”
The competitiveness of the market has changed due to the downturn. Companies are willing to discount just to get the deal done. The problem is that you start selling on price, which is a trap that is very hard to escape.
“The biggest challenge we are facing is that customers want to treat our products as commodities. They want to put us all in one group and it becomes a price war,” said David Sempek, director of sales and marketing for Highvac Corp. “We work with our customers so they understand the importance of buying quality not just price.”
Spreading fewer sales resources over the same number of products can only dilute effectiveness and burn out the remaining sales team. A better strategy is to clarify your product line.
“Look at your entire line and redirect your focus to only those must-have products in today’s market,” Hanes said. “These are likely to have been the core products which the company was built on and what the sales people are best at selling.”
Then align remaining company resources to these few focused products to create sustainability as the economy recovers.
Expanding resources and strengthening a company’s competitive position and value proposition can be another effective sales catalyst.
A more complete well-supported solution helps provide new opportunities for the sales staff and helps avoid the death spiral of only competing on price.
“We have pursued strategic joint ventures giving us complementary resources to be more competitive and provide a more complete solution to our customers,” Sempek said. “Being able to service more types of products makes us attractive to larger customers.”
Keeping the sales staff armed with an arsenal of strong messages that are relevant to customers and based on their pain points will set you apart.
“Marketing holds sales accountable for keeping the message consistent and the sales team holds marketing accountable for providing an effective, differentiated message in a compelling way,” Mitchell said. “If you have had to cut marketing resources, look at ways to outsource that component even if it is for two or three days a week.”
An increased intensity and focus on efforts and resources is a key benefit that can come out of business adversity.
A focused strategy will be a significantly better and more effective use of sales time and resources than a disorganized, high-pressure push.
The outcome will be a revved up sales engine that drives revenue.
Ann Snortland, principal of Snortland Communications, is the spokeswoman for the Peak Venture Group Middle-Market Entrepreneurs. She can be reached at firstname.lastname@example.org.