MIT Start Smart workshop - Maximizing Your Go-to-Market Strategy - 06252012

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Recently gave this seminar to a group of startup companies in MIT's Start Smart program in Boston

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MIT Start Smart workshop - Maximizing Your Go-to-Market Strategy - 06252012

  1. 1. MIT Start Smart Program: Maximizing Your Go-To-Market StrategyStephen N. Davis“Partnering With Clients to DriveSustainable Profitable Growth”
  2. 2. John Wanamaker “Half the money I spend on advertising is wasted, and the trouble is, I don’t know which half.”2000 - 2012 © CXO Advisory Group
  3. 3. 9 Steps To Sales Success2000 - 2012 © CXO Advisory Group
  4. 4. Get Into 1 The Mind Of Your Buyer2000 - 2012 © CXO Advisory Group
  5. 5. Develop 2 Your Buyers Profile2000 - 2012 © CXO Advisory Group
  6. 6. Develop Your Buyers Profile  Who is your “ideal customer?”  Who is typically the “key decision maker?”  How do they make their decisions?  Where do they collect their information to make a decision?  What are their critical business issues?  What is their buying process?  Where do they buy?  What is the Sales Cycle?  What are the “trigger events”2000 - 2012 © CXO Advisory Group
  7. 7. 3 Be Where YOUR Prospects Are.2000 - 2012 © CXO Advisory Group
  8. 8. Sales Channels – The Reality “A product with better distribution will always win over a product with poor distribution or customer access” It’s not fair. It’s not right. But, it’s reality.2000 - 2012 © CXO Advisory Group
  9. 9. Common Sales Strategy Mistakes Not having an adequate profile of customers2000 - 2012 © CXO Advisory Group
  10. 10. Common Sales Strategy Mistakes Confuse channel partners with final customers2000 - 2012 © CXO Advisory Group
  11. 11. Common Sales Strategy Mistakes Channels are not in sync with your targeted buyers2000 - 2012 © CXO Advisory Group
  12. 12. Common Sales Strategy Mistakes Thinking your “value proposition” is the same as theirs2000 - 2012 © CXO Advisory Group
  13. 13. Common Sales Strategy Mistakes Failure to consider licensing or joint- venture agreement2000 - 2012 © CXO Advisory Group
  14. 14. Common Sales Strategy Mistakes Insufficient channel margins2000 - 2012 © CXO Advisory Group
  15. 15. Common Sales Strategy Mistakes Insufficient marketing budget2000 - 2012 © CXO Advisory Group
  16. 16. Common Sales Strategy Mistakes Not aligning marketing to the sales channel2000 - 2012 © CXO Advisory Group
  17. 17. Common Sales Strategy Mistakes Channel conflict2000 - 2012 © CXO Advisory Group
  18. 18. Common Sales Strategy Mistakes Going to the channel before you’re READY2000 - 2012 © CXO Advisory Group
  19. 19. Plan Your Entry into the Channel “If you don’t know where you’re going you’ll probably wind up somewhere else”2000 - 2012 © CXO Advisory Group
  20. 20. Types of Sales Channels  Direct field sales reps  Internet sites  Corporate resellers  Extranets  Master or local  e-Marketplaces distributors  Direct Mail  Integrators  OEM’s  Value-added resellers  Retail  Manufacturer’s agents  Kiosk’s  Brokers  Strategic alliances  Franchises  Agents (consultants,  Telemarketers affiliates, etc.)  Inbound telesales agents2000 - 2012 © CXO Advisory Group
  21. 21. Customer Acquisition Costs Cost Freemium Minimal Inside Channel Direct Touch Sales Sales Sales Force2000 - 2012 © CXO Advisory Group
  22. 22. Comparison of Major Channels Retail Agent/Rep Distributor/VAR Acquisition Joint Venture Subsidiary Time to Market Slow Slow Medium/Fast Medium Medium Slow Management Control Low Medium Low High Medium High Brand Control Low Low Low High Medium High Cost of Sales Medium Low Low High Medium High Development of In-House Low Low Low Medium Low High Expertise Access to New Partners Low Medium Low Medium Medium Low Risk Medium Low Low/Medium High Low High Hands-On Sales/Marketing High Medium High Low Low Low Support2000 - 2012 © CXO Advisory Group
  23. 23. Computer Distribution Channels2000 - 2012 © CXO Advisory Group
  24. 24. What Do These Firms Have in Common?2000 - 2012 © CXO Advisory Group
  25. 25. Is Your Buyer Package up to Snuff?  Marketing materials  Price lists  Outline of your marketing campaign – Demand Creation  Product samples - Packaging  COOP/MDF funds and campaigns  In-store merchandising  Prospect & customer correspondence  Sales training for their personnel  Sales support  End user training  End user support2000 - 2012 © CXO Advisory Group
  26. 26. Joint Venture/ OEM / Private Label  Quick penetration – less risk  Established market presence  Provides localization of product  Handles all marketing, sales, distribution & support  Provides ongoing market analysis  Provides ongoing competitive analysis  Usually wont carry competing product  Tough sale – long sales cycle2000 - 2012 © CXO Advisory Group
  27. 27. Approaching a Potential Joint Venture/ Private Label Partner  Be Ready to Explain Key Product Advantages  Do Your Homework • Why should they be interested? • Fills competitive hole • Enhances existing product line • Prevents having to compete against you • You could develop market in your home country for their products  How easy it will be to work with you  Support you will give them • Technical • Training2000 - 2012 © CXO Advisory Group
  28. 28. Key Issues Licensing Agreement  Specs & Deliverables  Marketing Obligations  Acceptance  List Price of Product  Grant of License  Performance Requirements  Terms  Warranties  Payments  Limitation of Liabilities  Bookkeeping Requirements  Development Support  Ownership  Rights to Updates  Use of Trademarks  Termination  Training  Source Code Access  Decision Making Authority2000 - 2012 © CXO Advisory Group
  29. 29. Distributors/Wholesalers2000 - 2012 © CXO Advisory Group
  30. 30. Distributors  Sells to other channel players within designated area  Takes title to goods and is compensated by mark-up upon sale  Sells suppliers goods to his own customers  No authority to act on your behalf  Maintains Inventory  Sells in original packaging  May or may not provide after sales services  Many products are taken on consignment basis2000 - 2012 © CXO Advisory Group
  31. 31. What Distributors Look For  Products with proven demand  Products packaging, ease of use & install  Marketing budget  Quality tech & Customer support  Ability to scale up to demand  Financial stability  Training  Distributor staff time required Only 1% - 2% of products presented get chosen2000 - 2012 © CXO Advisory Group
  32. 32. Manufacturers Agent/Commercial Agent  Alternative to own sales force  Both authorized to solicit orders in designated area  Receive salary or commission  Usually bear no credit risk  Maintains no inventory  Requires same support & training as internal salesforce  Carries several lines  References, References, References2000 - 2012 © CXO Advisory Group
  33. 33. Typical Rep Territories - USA2000 - 2012 © CXO Advisory Group
  34. 34. Typical Rep Territories - Canada2000 - 2012 © CXO Advisory Group
  35. 35. Source to Identify GOOD Reps  Customers and potential customers  Known GOOD Reps  Companies with complimentary products to yours  MANA (Manufacturers Agents National Association) • Manaonline.org  ERA (Electronic Representatives Association) • Era.org  AIM/R (Association of Independent Manufacturers/Representatives) • aimr.net2000 - 2012 © CXO Advisory Group
  36. 36. Rep Agreement Caveats  Most rep agreements have commissions due on order • Commissions should be paid ONLY AFTER YOU COLLECT  Commissions should be on NET Sales • Sales MINUS returns and any upfront market development funds paid to the retailer  Splitting commissions • Between rep territories  Territory definition  National (House) accounts  Termination issues  Automatic renewal2000 - 2012 © CXO Advisory Group
  37. 37. Retail2000 - 2012 © CXO Advisory Group
  38. 38. Retail2000 - 2012 © CXO Advisory Group
  39. 39. You Need to Satisfy All FOUR Customers to Gain Retail Distribution  Corporate  Store  Salespeople  Customer – End User2000 - 2012 © CXO Advisory Group
  40. 40. Cost of Market Entry Options Retailer Mark-up, 50% - 200%+ 5-10% MDF, Slotting Fees, Beware Consignment sales Agent/ Rep. Commission, 5%–30%, Wants to be paid on order Value Added Reseller Margin, 20-40%, 5-10% MDF (VAR) Distributor (stocks product) Margin, 10%–50%, 2-5% MDF2000 - 2012 © CXO Advisory Group
  41. 41. Your Most Critical Pieces for Revenue Growth Sales Marketing2000 - 2012 © CXO Advisory Group
  42. 42. 2000 - 2012 © CXO Advisory Group
  43. 43. 2000 - 2012 © CXO Advisory Group
  44. 44. “Your Marketing Leads S*CK!!!”2000 - 2012 © CXO Advisory Group
  45. 45. “We Send Qualified Leads To Sales & They Fall into a Black Hole”2000 - 2012 © CXO Advisory Group
  46. 46. “Sales Sells Product to the Wrong People!”2000 - 2012 © CXO Advisory Group
  47. 47. 90% % Of Marketing Materials UNUSED BY SALESSource: AMA2000 - 2012 © CXO Advisory Group
  48. 48. “Marketing Doesn’t Provide What We NEED!!”2000 - 2012 © CXO Advisory Group
  49. 49. “Sales Doesn’t Have a Clue About BRANDING!”2000 - 2012 © CXO Advisory Group
  50. 50. “I Can’t Believe Sales Asked that Question. It’s in the Literature!”2000 - 2012 © CXO Advisory Group
  51. 51. Sales Spends 40% Of Their Time Creating Their Own Marketing MaterialsSource: CMO Council2000 - 2012 © CXO Advisory Group
  52. 52. 10 Min/Week Additional Selling Time = $57,000 Additional Revenue Per YearSource: IDC Sales Enablement Research2000 - 2012 © CXO Advisory Group
  53. 53. “Marketing Doesn’t Involve Sales in its Planning!”2000 - 2012 © CXO Advisory Group
  54. 54. “Sales Doesn’t Provide ANY Feedback!”2000 - 2012 © CXO Advisory Group
  55. 55. 4 Align Sales & Marketing2000 - 2012 © CXO Advisory Group
  56. 56. Better Aligned = More Business 5.4% Faster Growth on Year-to-Year Basis Than CompetitionSource: MarketingProfs2000 - 2012 © CXO Advisory Group
  57. 57. Better Aligned = More Business 38% Better at Closing Proposals than Non-Aligned CompetitionSource: MarketingProfs2000 - 2012 © CXO Advisory Group
  58. 58. Better Aligned = More Business 36% Less Churn of Their Customers To CompetitionSource: MarketingProfs2000 - 2012 © CXO Advisory Group
  59. 59. Marketing and Sales look at the world through different lenses2000 - 2012 © CXO Advisory Group
  60. 60. Marketing Looks For Mr. Right2000 - 2012 © CXO Advisory Group
  61. 61. Sales Wants Mr. RightNOW2000 - 2012 © CXO Advisory Group
  62. 62. When Their Isn’t A Common Profile You End Up With2000 - 2012 © CXO Advisory Group
  63. 63. “Marketing & Sales Should Jointly Define a “Sales-Ready” Lead!”2000 - 2012 © CXO Advisory Group
  64. 64. 5 Develop Your Inbound Marketing Program2000 - 2012 © CXO Advisory Group
  65. 65. “ If the expenditure doesn’t create a lead, or directly help sales close a prospect, You SHOULDN’T do it”2000 - 2012 © CXO Advisory Group
  66. 66. The Marketing Landscape has Changed… “Buy My Product”2000 - 2012 © CXO Advisory Group
  67. 67. Ads are Everywhere People see and hear between 1,000 87,600,000 throughout their lives and 3,000 advertising messages/day2000 - 2012 © CXO Advisory Group
  68. 68. Trust Drives Transactions 66% Of the Economy is Influenced by Personal RecommendationsSOURCE: McKinsey & Co. 2000 - 2012 © CXO Advisory Group
  69. 69. Trust Drives Transactions 91% Say consumer reviews are the #1 Aid to Buying DecisionsSOURCE: JC Williams Group 2000 - 2012 © CXO Advisory Group
  70. 70. Trust Drives Transactions 78% Trust Recommendations of other ConsumersSOURCE: Nielson Report - October 2007 2000 - 2012 © CXO Advisory Group
  71. 71. Trust Drives Transactions 88% Will Buy from Companies they TRUSTSOURCE: Edelman Trust Barometer, 2008 2000 - 2012 © CXO Advisory Group
  72. 72. Trust Drives Transactions 85% Will NOT buy from Companies they DISTRUSTSOURCE: Edelman Trust Barometer, 2008 2000 - 2012 © CXO Advisory Group
  73. 73. Lead Scoring For Better Allocation of Resources  Ranks one prospect vs another  Unbiased way to determine which department should focus prospect  Identifies “Sales-Ready” Prospects  Helps tune your ideal buyer profile2000 - 2012 © CXO Advisory Group
  74. 74. Have a Formal Lead Management System New Lead Registered Lead Lead Nurturing Buying Cycle Phone Ready Lead TeleQualify Leads Sales-Validate Lead Hand Off to Sales Demo/Meet/Proposal Enter Sales Forecast Closed Deals2000 - 2012 © CXO Advisory Group
  75. 75. Develop Relevant Buying Cycle Sales Tools2000 - 2012 © CXO Advisory Group
  76. 76. 6 Automate And Track2000 - 2012 © CXO Advisory Group
  77. 77. 7 Measure Marketing On Contribution to Revenue2000 - 2012 © CXO Advisory Group
  78. 78. 8 Analyze Quality of Leads Generated And Tools2000 - 2012 © CXO Advisory Group
  79. 79. 9 Improve Your Tools And Programs2000 - 2012 © CXO Advisory Group
  80. 80. The 9 Steps 1. Get Into The Mind Of Your Buyer 2. Develop Your Buyers Profile 3. Be Where YOUR Prospects Are 4. Align Sales & Marketing 5. Develop Your Inbound Marketing Program 6. Automate And Track 7. Measure Marketing On Contribution to Revenue 8. Analyze Quality of Leads Generated And Tools 9. Improve Your Tools And Programs2000 - 2012 © CXO Advisory Group
  81. 81. Questions2000 - 2012 © CXO Advisory Group
  82. 82. Driving Profitable Growth2000 - 2012 © CXO Advisory Group
  83. 83. Driving Profitable Growth We help companies optimize business development and marketing; accelerate sales; and seize the most attractive growth opportunities.2000 - 2012 © CXO Advisory Group
  84. 84. The CXO Advisory Group  CXO Advisory Group is a strategic operations advisory and management firm comprised of proven C-level executives with both breadth and depth of experience.  CXO Advisory Group Team members have achieved success in positions ranging from: President/CEO to COO, and VPs of Sales, Marketing, Corporate Development and Human Resources.  Has proven success in business development and in building US sales and distribution channels2000 - 2012 © CXO Advisory Group
  85. 85. How Can CXO Help You? Business Strategy Services • Audit business practices and organization • Evaluate product and pricing strategies • Evaluate effectiveness of sales channel • Assess effectiveness of existing sales and marketing programs Market Entry Program • Analyze competitive landscape • Market launch strategy and plan • Channel strategy and programs • Establish sales channels • Generate sales and manage relationships • Identify and develop strategic partnerships2000 - 2012 © CXO Advisory Group
  86. 86. How Can CXO Help You? Sales Channel Management • Review and revise sales channel strategies • Channel partner identification, prospecting and recruitment • Eliminate channel conflict • Channel contract development and negotiation Interim Management Resources • Interim CEO, COO, CMO, CSO • Interim VP of Sales and Marketing • Consultant on staff • Launch team coaches2000 - 2012 © CXO Advisory Group
  87. 87. How Can CXO Help You? Venture Advisory Services • Fine tune operations, business strategy and market entry • Assist with due diligence • Strategic business assessment of portfolio companies2000 - 2012 © CXO Advisory Group
  88. 88. Contact Information: Stephen Davis Interim COO/VP Sales & Marketing | Business Consultant | Sales Channel and Business Development Expert | Author & Speaker “Partnering With Clients to Drive Sustainable Profitable Growth”Phone: (508) 528-7571Email: sdavis@cxoadvisorygroup.comWebsite: www.cxoadvisorygroup.comLinkedin: www.linkedin.com/in/stephendavisTwitter: twitter.com/stephendaviscxo

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