Many companies generally fail to see the forest for the trees, but the growth potential is often right in front of them. We get stuck in old habits and we just do things as we always have, e.g. most people have had the same morning routines for ages; the same goes for companies and their customers. If we do what we always have, we will get the same result.

Salespeople tend to focus on the customers they already know and therefore companies often do not focus on customers that are most attractive. With clear customer prioritization, companies will get a better understanding that can answer the following simple questions:

• Where do we get the most value for money in our customer and prospect database?

• How can we make optimal use of our sales force in order to spend sufficient time with customers and prospects with the largest potential?

A senior sales representative at a global manufacturing company once told me, that he had more than eight hundred dealers he had to visit and that they were all equally important. During our conversation, he told me it was extremely hard to reach his target. He was talking about a reduced territory and fewer customers. Furthermore, he had not visited a single prospect for a decade. I was surprised by his story and asked him how he prioritized his customers. I do not disagree that customers are equally important, but there is not time to serve all equally. So, is there a workaround?

Of course, but let us understand why first.

HOW ARE THINGS EVOLVING AND WHAT CAN YOU DO?

Every organization must do it, no matter if it is a large global corporation or a local grocery shop on the corner. It is no secret that some customers are more profitable than others. Being aware of these differences will allow companies to have different approaches to different segments. Customers have different needs and that is why customer segmentation is a necessity and it can help companies:

• Stay more focused on the customers’ needs

• Improve competitiveness, i.e. knowing where to be and not to be

• Improve their capability to expand the business organically by increasing share-of-wallet (SOW)

• Increase customer retention due to better customer service

• Optimize price by maximizing selling value rather than price.

A company should decide which customers and prospects it wants to spend most efforts with. In a perfect world, a company should be able to give the same service to all their customers but that is not possible. There is just not enough time to support all customers equally, due to time, money and resources. The focus must be on the most attractive existing and potential customers.

Customer prioritization is about assessing which customers and prospects to work with for the upcoming period. That can change rapidly, so it is better to review the customer prioritization frequently. A rule of thumb is every quarter, but it depends on the industry and the products. Always keep some free time to run after great opportunities. On one hand, you want to stick to your plan and on the other, you want to be flexible.

Customer segmentation is necessary when communicating with your target audience. By segmenting consumers, it will be easier to reach the most ideal visitors who are more likely to become leads. By reaching a specific group of people, marketers can design messages specifically for that group. This communication will help build relationships and build messages that resonate.

Customer Segmentation requires managers to:

• Divide the market into meaningful and measurable segments according to customers’ needs, their past behaviors or their demographic profiles.

• Determine the profit potential of each segment by analyzing the revenue and cost impacts of serving each segment.

• Target segments according to their profit potential and the company’s ability to serve them in a proprietary way.

• Invest resources to tailor product, service, marketing and distribution programs to match the needs of each target segment.

• Measure the performance of each segment and adjust the segmentation approach over time as market conditions change decision making throughout the organization.

• Prioritize new product development efforts
• Develop customized marketing programs
• Choose specific product features
• Establish appropriate service options
• Design an optimal distribution strategy
• Determine appropriate product pricing

By using several segmentations together, you will create the maximum impact. Customer segmentation is beneficial for all types of businesses, start-ups, and global industries since it will help you reach the customers you want to have a relationship with. Segmentation is the most successful when the message is tailored towards the right audience.

How do we work with and plan for change when everything is constantly changing around us?

The key components of organizational change are effect and impact. If the organization doesn´t reflect on the new ways of organizing they will continue to struggle to obtain the desired effect and impact of change.

It´s common knowledge that over 70% of all change projects fail to achieve the impact desired from what was described in the business plan. This is partly due to management’s inability to provide clarity and engagement throughout the process. Project managers solve the challenges with designing another workflow which includes change management and change communication. These initiatives are targeted toward the people of the project to help the organization adapt to changes faster and better.

Getting the organization onboard when implementing a new strategy, system, or process continues to be difficult for management due to poor communication.

Most change intends to improve or optimize the organization’s everyday operations. The challenge is that more than 70% of change initiatives fail to meet their original intent.

Part of the challenge is that executives often consider themselves to do better in their communication strategy than they are. A well-designed communication strategy that prepares and engages the organization in the change from the start is more likely to succeed. For change to be successful, it requires vocal and engaged personal who take ownership for the success of the change. Management needs to provide a clear picture of the perspective and purpose of change. Otherwise, the employees will do a lot of guesswork and speculation. Facts, figures, and plans are important in change communication as it lays the foundation for understanding the change rationally.

Do you have the organization onboard?

”Okay, let’s do it like this. Next week you should do the following…”, interrupts the Sales Manager to his sales rep. Many Sales Managers are impatient and think they have all the answers. What will happen is that you will have a sales team being reactive and will wait for your commands. Companies spend thousands of dollars on new CRM systems, sales training programs, commercial excellence programs, and motivational speakers with one single purpose: growing the top-line. Investing in the frontline is great but do you have to overspend to achieve great results?

The sales manager is always on demand by the sales reps who want them to solve their problems, sales reps’ customers who want to shake hands with someone more senior, the organization who wants updates about the department’s forecast, access to reps and data. Sales managers look like firefighters, always putting out fires all day long instead of being with their team.

Always being on-demand and doing administrational work means that they have no time to do their real job which is to spend time with their sales team coaching and helping them win more deals. The sales manager needs to plan their time and resist the urge to answer every phone call and e-mail. If a person knows they have a set time with you, they tend to email and call less frequently. Silence the fire truck, plan for thinking, managing, and coaching.

The sales managers shouldn’t be fulltime firefighters, they should be full-time managers and coaches.

There is a mathematical formula for growth with four points for organic growth:

1. Number of opportunities created

2. Win rate

3. Average order/contract size

4. Retention rate

The number of opportunities created x Win rate (in %) x Average order size constitutes the revenue generated in any period on top of recurring business. The retention rate is a measure of the company’s ability to keep customers on board after their first purchase. Any percent-increase or -decrease in any of the four drivers directly influences the growth rate.

If your retention rate remains constant, but you improve the number of opportunities created, win rate, and Average order/ Contract size by just 5% each, your new sales growth is close to 16%. If at the same time, you increase the retention rate by 5 -10%, you will be looking at growth rates way beyond the market- or industry average.

FROM THEORY TO REAL-LIFE GROWTH

It is crucial to have a global combination of sales processes and behaviors, which require a global behavioral change in the entire sales organization and the engagement of the local sales managers and the development of their coaching abilities.

There are two elements to creating sustainable change in sales.

• There must be processes and tools in place that promote and encourage desired behavior

• Sales managers must change the conversation they are having with their salespeople so that they reflect the conversation they want them to have with their customers.

Many companies spend between 5% to 15% of revenue on sales. The way you develop and use that investment makes a significant difference in both top-line growth and bottom-line performance. Getting it right is very important. Commercial Excellence is becoming about a sales strategy based on hard facts. Sales strategies are usually based on intuition with sales representatives as “artists”.

The sales process was characterized by:
• Relationship-based selling
• Persuasiveness
• Product know-how
• Incentivized by volume, with top sellers making unit

The new fact-based approach is more science than art:
• Channels are actively managed and steered by profitability and cost-to-serve consideration
• Salesforce effectiveness guided by several targets such as volume, profit, and customer satisfaction
• Pricing is based on customer value and microsegments. Specific training and retention programs are in place, especially in emerging markets.

Every company that wants to grow needs a solid strategy. To keep the company on the right path, you need a go-to-market plan with a clear vision of what you are selling, how, where, and to whom.

So, what is that you are selling?
Are you launching a new product?
Re-launching your company and brand?

Or do you want to move an already existing product to a new market? Whatever it is, the strategy should be a valuable tool with all the information you need to implement it, but that can be updated after feedback from prospects.

Customer Relationship Management software is used to drive growth and profits. Designed for sales, marketing, and service.

How does it work?
CRM is a platform that gathers information from all channels; social media, website, email, etc. help the company obtain more customers and keep the existing ones. The CRM gathers everything and tracks leads, customer needs, offers, and conversions, in one place so that you can organize business processes, workflows, close deals, and collaborate. You save time since CRM keeps track of all data due to machine learning and analytics, which lets you streamline and improve customer interaction, sales, and marketing campaigns. Automating tasks and analyze data.

BENEFITS OF HAVING A CRM SYSTEM

BENEFITS OF CLEAN DATA

The B2B sales landscape has always been widespread, with field sales representatives traveling across the country, meeting clients, prospects, and working at conferences. Sales representatives are used to being coached one-on-one by the sales manager and having regular teambuilding exercises that strengthened the team. In short, sales representatives are used to meeting and connecting with people every day. Then the pandemic covid-19 hit, and the entire sales model had to change to no in-person contact and a declining economy.

The B2B sales team was forced to drastically change the way they work and move  bout in the world, the office moved home, and all meetings are held online. Some companies have even been forced to close. Sales leaders needed to adapt the way the team is selling since customer needs, habits, and economics are changing. The B2B sales landscape will be completely different from what it was before the pandemic. Companies are reducing spend, interaction through digital channels is becoming essential, and sales have moved from in-person meetings to videoconference, phone calls, and web sales.

MOVING TOWARDS A DIGITAL WORLD

Companies will realize that there is no need for big office spaces because it is more likely that work will be done remotely once the pandemic is over. Instead of permanent office locations, meetings will occur in restaurants, community meeting spaces, or meeting rooms in coworking spaces.

We will also see a decline in travel; instead of sales reps going out in the field, they can communicate with their customers via video conference calls. Time spent on travel is saved and can be used for more customer interactions. Businesses will also become more environmentally aware and start purchasing locally. Essential travel will be close to none.

Sales have become a digital experience during the pandemic, and it is likely to stay that way once it is over. Virtual meetings, telephone calls, and webinars are the new routine, and in the future virtual reality, technologies can be a standard tool for presenting your product to the customer.

CPQ means configure, price, and quote software, which is used for sales optimization. CPQ is a tool for organizations to quickly generate quotes for orders in correlation with CRM, ERP, and other business technology, ensuring integrated data and accuracy. Quotes are required by a preprogrammed set of rules, which results in error-free pricing based on quantity, discount, customization, electable features, revenue type, and incompatibilities.

Successful implementation
To measure CPQ implementation success, start with setting a goal for what the organization wishes to achieve. Goals can be quantitative or qualitative, depending on the organization’s overall objectives. Also, map the sales team’s challenges and design the CPQ so that it solves the challenges. Ensure that product models create useful configurations, the structure of the pricing rules, and the quotation process for a consistent experience.

Value for money, customer support, and product satisfaction, but an emotional connection sets companies apart, including brand identification, social responsibility, innovation, and trustworthiness. The best companies generate both value for money and an emotional connection, and in some cases, emotional connection is more important than value for money. How customers identify with a brand and how innovative they perceive it to allow for premium prices.

The sales kick off is an annual event that everyone in sales looks forward to since it is one of few times when sales teams come together in person. The sales kick–off is the perfect opportunity to connect, build, and enhance relationships, align goals and expectations, and inspire the organization around the company vision. It is a time for sales teams to get on the same page and ready to succeed in moving forward.

PROS & CONS

Of course, there are pros and cons to having an online event instead of getting together and meeting in the same room. For instance, it is easier to educate the team about products since there are no distractions then motivate learning by having a friendly competitive quiz. Cons is, of course, that it gets more difficult for team members to network and socialize with one another, making it harder to build on the company culture.

Now is the time to innovate how the sales kick–off is being done, encourage the team through the year, and hope for an even better in-person gathering next year.