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Death of the salesman
The document proposes radically improving sales by shifting from a people-driven to a process-driven sales system. It recommends cutting costs by generating more leads for less through marketing instead of salespeople, nurturing leads through automated education instead of human contact, and ensuring the best closers close deals. An example company could replace a salesperson with a lead generator, invest savings in marketing, implement a lead scoring system, and assign most nurturing and closing to processes instead of individual salespeople.
Death of the salesman
- 1. Double sales bycutting the salesforce in half Death of the Salesman:
- 2. • Better trainsalespeople • Better sales management • Improve the sales compensation system • Get the sales staff to work harder • Hire better staff • Improve marketing Which of the following is the best way to improve sales?
- 3. • You havealready tried that list and it worked a little • It’s time to try something that will RADICALLY improve sales The answer is “none of the above”
- 4. • Spending 2Xmore than needed to generate leads • Losing hundreds of thousands of dollars on deals that could close but don’t • Grossly overpaying some salespeople • Grossly under-utilizing other salespeople • Letting salespeople take the credit (and pay) for marketing success Attack the inefficiency: Salespeople
- 5. • Pay themto prospect and they don’t • Pay them to babysit deals • Take credit for deals that would have happened without them…. it’s called “buying” • Blow deals that a more skilled salesperson might close The Problem with Salespeople
- 6. Get rid ofthem all The Solution:
- 7. • Change yoursales philosophy and stop thinking of “sales” as one activity • Sales is really 3 things Solomon’s Sales Solution Generate Leads Nurture Monte Hall
- 8. • 3 Processaided by people • Leverage changes in buyer habits rather than fighting them - Distaste for “selling” - Self-study or self-sell vs. be sold - Virtualized selling (webinar, video, etc) - Reduced effectiveness of interruption marketing Solomon’s Sales Solution
- 9. • Process first,people second • Historically just “threw” a salesperson at the problem • …and it worked….now the ride is over Shift people-driven sales system to process-driven sales system
- 10. • Most salespeopleare only good at 1 of the 3 functions • High school science teacher - Brains * beauty = constant • Salesperson math - Lead gen ability + nurturing ability + closing ability <20 - However, the company needs it to be 10 on all 3 Fighting “Salesperson Math”
- 11. Salesperson A SalespersonB Lost Opportunity Lead Generation Lead Nurturing Closing Lost Opportunity Lead Generation Lead Nurturing Closing Lead Generation 6 Lead Nurturing 10 Closing 4 Lead Generation 6 Lead Nurturing 2 Closing 9
- 12. The 30 pointSuper-Saleswoman does not exist
- 13. • Rank yoursalespeople in the 3 categories 0-10 • 20 points maximum • Where is the company weak/strong? • Where do your salespeople spend their time? Where should they spend it? • Closing the gap between the average salesperson score and a perfect 30 is your potential sales increase Exercise 1
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- 16. Trimming the salesfat & reinvesting
- 17. There’s a widevariance in sales effectiveness
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- 21. • General over-investmentin salespeople - Lead Generation Exercise • What’s a lead worth? • Salesperson total comp, % you want leads for it, cost/lead • General under-investment in marketing - Cost per lead for: telemarketing, appointment setting, direct mail, PPC, SEO, etc. - What if I COULDN’T use a human? Step 1: Generate more leads for less money
- 22. Step 1: Generatemore leads for less money
- 23. • Tendency topay people to babysit rather than move deals forward in a pre- programmed methodology • What does the client really need to become sales ready? - Information - Think fractionally. Does every step require expensive human contact or does the client just want the data? • Shift from one-off, human delivery of information to automated, self-service delivery Step 2: Change the lead nurturing process
- 24. • Lead NurturingExercise - What if I COULDN’T use a human? How much would that cost? - What % of your total salesperson cost is for lead nurturing? Worth it? - Other methods? • Education-based marketing • Seminars/webinars/teleclasses • Autoresponders • Outsourced professional emailers Lead Nurturing Exercise
- 25. “The most expensivemistake in business is giving a good lead to a bad salesperson” Step 3: Close every deal you should
- 26. Reduce the costof un-selling
- 27. • Closing Exercise -Does it require a human to close? • Amazon and other etailers upsell and close without humans - What’ the close rate vs. best person? What's the cost of lost deals per salesperson? • ceofocus.com/sales.xlsx Under-investment in great closers
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- 29. • Background - Webdeveloper selling to $5M to $50M retailers • 3 salespeople - #1: Supercloser. Ok at prospecting, bad at lead nurturing. Pay $125K. Most of business is new customers & self-generated leads - #2: Can’t close or lead gen, great nurturer. Pay $60K. Most business from existing customers, referrals, or trade shows - #3: Average at all 3. Pay $80K. Some business from self-generated lead, but most from referral or upsell existing customers. Company A
- 30. • Marketing - Afew trade shows ~25% of leads ($3000/lead) - Salesperson leads account for ~25% of total - Referrals ~15% of leads - Web leads ~30% ($1500/lead) - Misc ~5% • Average deal $20K upfront, $20K additional services over lifetime • Average margin upfront 45%, ongoing 60% (5 year customer retention) • # new leads per year 200, close 40 (average lead value $4000) Company A
- 31. • Lead Generation •Lead Nurturing • Closing • Salespeople What should Company A do?
- 32. • Step 1:Flowchart the sales process and assign steps/boxes to each function or person • Lead Generation - Replace salesperson #2 or #3 with lead generator - Use $20K savings to spend on PPC/SEO - Remove lead generation responsibilities other than trade shows from salespeople • Lead Nurturing - Implement a lead scoring system to know when leads are to be passed to salespeople for closing - Create education-based marketing system and autoresponders, webinars, and conference calls to move clients through sales process more efficiently - Assign lead generator or customer service rep to most of lead nurturing process. • Closing - Assign 3/4th of leads to salesperson #1 - Create dropout loop to continue to educate lost or unclosed deals Potential Solution
- 33. Creating a salesprocess that works Next Steps
- 34. • Lead generation -Break lead generation away from salespeople - Invest more in marketing - Leverage technology • Lead nurture - Most common area of over-investment - Most likely cause- too small of a pipeline so beat on weak prospects - Have the guts to use internet-based mutual opt-in process instead (videos) - Trust the system you create. Buyers who are a good fit will find a way to buy. Bad fits will find a way not to buy. - Create a dropout loop for lost or dead deals • Closing - Stop giving good deals to bad salespeople - Stop giving credit to salespeople for deals that would have closed themselves Options
- 36. • Stop sellinglike it’s 1985 - http://youtu.be/wojZTsgUqjc • Using a mutual opt-in sales system - http://youtu.be/ygMgo-nK-hU • Sales Virtualization - http://youtu.be/wNXT_SEZr60 • Thanks a lot internet - http://youtu.be/ebh_u-ZnH1c • Local sales group forming References
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