by Bill Poole | Dec 18, 2020 | Marketing, Sales
Originally published on Revenuegrowthengine.net.
For those who are obsessed with their products, the superiority of their business, or the beauty of their brand, this statement contains a hard pill to swallow. As great as your products are, as experienced as your team is, and as responsive your customer service may be, that’s not what buyers are buying. People do not buy your products, they buy the outcomes your products create.
Bob Moesta explores this principle in Demand-Side Sales 101. He shares the story of how he stopped trying to push his product on customers. Instead, he worked to understand the actual outcomes the customer desired. Then he engineered the buying process to satisfy the customer’s demand.
Buyers have a “job to be done”. That is why they buy a product. Period.
The “Jobs to be Done” theory (pioneered by Moesta and Clayton Christiansen one of my favorite authors) has been applied to design the world’s best-selling products. Successful product design begins with an obsessive examination of the outcomes that consumers want. Based on this, the product is reverse engineered to meet the demand.
The opposite of the “Jobs to be Done” theory is the “Product to be Sold” theory. Companies create products designed based on assumptions about what the prospect wants. Next, they fire up the manufacturing plant or the development team to build the product.
These ill formed products are presented to the sales team who then applies the “Quota to be Hit theory.” Sales reps assume they know what the prospect wants. Then, they proceed to put square pegs in round holes. It can work, but it creates a mess, a lot of hammering, and mediocre results.
Like Simon Sinek prophecies, we end up starting with “What?” and then try to answer the question, “How?” All of this ends up with frustration and often failure.
What if we actually started with “Why?” Why would the consumer care? Where are they feeling discomfort or frustration and why?
Moesta believes that for most companies there are only a handful (3-5) core “whys” that create demand. Once we intimately understand these drivers of demand, we can then craft our Ideal Client Experience and Focused Message around this demand.
Start with your Ideal Client. What outcomes do they want? This forms the foundation of demand. Build on this foundation and you’ll find success, even in an uncertain market. (Build on the foundation of how great your product and company are and you’ll discover that you have built your company on sand.)
How do you discover the outcomes your clients want? Ask and observe. Ask your Ideal Clients about their goals and challenges. Peel back the layers of the onion. Go deep. Seek understanding as to the real implications of the problem for their business and personal lives. (For more, read Value Is In the Eye of the Beholder.)
Then, watch. Pay attention to how the current situation frustrates them. What are their work-arounds? What’s holding them back.
From the client perspective, craft your Focused Message around the outcomes your Ideal Clients want. Propagate this message through all of your marketing and sales content. Then, design your Ideal Client Experience to match the actual demand in the market.
Just as manufacturers and software developers create successful products when they listen to their prospects, your marketing efforts will succeed as you pay attention to the actual demand, seeing to understand why your prospects buy and how they would like to buy.
by Bill Poole | Nov 9, 2020 | Sales
Of all the things your dealership could do in the next year to grow sales, what could move the needle more than anything else?
In the book Extreme Ownership, Jocko Willink tells a story that rings true in our industry. The CEO of a pharmaceutical company had all kinds of new initiatives including: (more…)
by Bill Poole | Nov 6, 2020 | Sales
Creating a profile of your ideal client is an exercise that serves many purposes for any business that has limited resources (which is all businesses, right?). Especially in a B2B business, it is much more efficient and profitable to acquire, manage, and delight a client that you know your business is optimized to serve.
Profiling Your Ideal Client
If you have gone through the process of profiling your ideal client and haven’t looked at it for a while, or would like to validate your decision making process, here are 3 considerations to filter your work:
- Do they all want the same things?
- Is it efficient to deliver your products and services to all of your ideal clients?
- Are they all able to enjoy all of what you have to offer?
Do they want the same things?
As our Visionary Darrell Amy says in one of our previous blogs, “Buyers don’t buy products, they buy outcomes…people don’t buy drill bits, they buy holes.” To take it a step further, you need a hole in your wall for a specific reason. For example, I would like to be able to fly a flag in my front yard, but the front of the house is stucco, and hanging a flag mount on stucco is not all that easy.
So, while I actually need to buy a drill bit that can drill into stucco, what I am investing in is some sense of pride that I might get from flying the stars and stripes or raising a flag when the Baltimore Ravens are competing in the playoffs.
But let’s turn back to your ideal client profile: Do your ideal clients want the same outcomes?
Yes? If they do, it makes it a lot easier to connect with them using messaging that’s focused on the outcomes they want.
No? If they don’t, it will be hard to connect with your ideal prospects in your efforts to sell net-new business because your messaging may only resonate with some of these prospects.
Is it as efficient to deliver your products and services to all of your ideal clients?
Think of two fictitious restaurants as an analogy to illustrate this point:
- A+ Burgers: A restaurant that is all about burgers. They sell a yummy burger and a handful of simple complementary side dishes.
- Downtown Bistro: A restaurant that offers burgers, steak, chicken, and salads with some with an Italian twist, others with Asian spices, and some just plain American!
I love to eat, and anyone that knows me knows that I typically do extensive yelping before I make the seemingly life altering decision as to where to eat. I typically have a better experience and meal when I eat at a place that has a clear identity. I have found that the quality of the burger, steak, chicken, or salad that I might get at a restaurant like the Downtown Bistro is sub-par to a place that has a specialty like A+ Burgers.
Interestingly and more relevantly, A+ Burgers is more than likely able to deliver phenomenal burgers more efficiently with less cost than the Downtown Bistro is able to deliver their extensive, less-yummy menu of diverse offerings.
Is your business set up to do too many things for lots of customers? Or are your products and services well aligned to serve the needs of specific clients? Businesses that are more focused on a tightly defined ideal client typically have better client satisfaction.
I met with an associate recently that told me he had about 100 clients and annually goes through the exercise to fire the 6 of them. How cool is that? So, they fire the 6 clients that cause the biggest drain on his resources from either a time or emotional standpoint in order to serve the other 94 better. I’m quite confident the flywheel result of that is happier clients, resulting in more bandwidth to serve Ideal Clients. I am quite certain that it is not too hard for them to replace those 6!
Are they all able to enjoy all of what you offer?
Ideally your suite of products and services are targeted at your ideal client. Given that, you should be well positioned to expand your share of wallet with all of your ideal clients to maximize your revenue.
It is probably a good exercise to take a look at your client base. What percentage of them do you feel are a fit for everything that you offer? Going through that exercise should help you determine which ones you should be focusing your limited resources on. Not to say that you need to get rid of the ones that are not able to enjoy everything you do, but it should help you prioritize your efforts.
Speaking of limited resources, shouldn’t your sales and marketing efforts be focused on the ones that you can fully service? Having a focused, aligned sales and marketing strategy focused on the clients that can maximize your revenue seems like a good idea, huh?
by Bill Poole | Nov 5, 2020 | EOS, Marketing, Sales
One way to grow your EOSⓇ business faster is to attract and cross-sell ideal clients. These are the types of clients that appreciate what you do and can buy everything that you sell.
Unless you have a limitless marketing budget and massive sales team, trying to sell to everyone is a recipe for failure. Both your message and efforts get diluted, lost in a vast ocean of noise. Plus, you end up wasting a lot of time talking to prospects who really don’t value what you do.
It’s kind of like your garden hose. When you first turn it on, there is a stream of water, but not much pressure. When you add a nozzle to the end, you can focus the stream of water and create pressure. If you want to kick it up a notch, connect your hose to a pressure washer.
The more you focus your stream of water, the more effective you can be. Similarly, the more you focus your marketing and sales efforts around ideal clients, the faster you can grow your business.
In Traction, Gino Wickman talks about building “The List”. We call the companies on this list, “Ideal Clients.”
Let’s explore how to identify ideal clients and focus your efforts to grow faster.
Building The List
In our Revenue Growth Workshops, we lead teams through the process of building their ideal client profile. At the end of the process, they have identified three things:
- Value: The revenue potential of an ideal client over 10 years
- Description: The characteristics of an ideal client
- Data Profile: The data profile of an ideal client
With the description and data profile in mind it is possible to identify “The List” talked about in Traction.
In reality, you should have two lists:
- Ideal Clients: Current clients that fit the profile of being an ideal client.
- Ideal Prospects: Target companies that fit the profile of an ideal client.
With your ideal client profile, it becomes possible to build a list of ideal prospects. These refined lists can be created with the help of data providers who can source information on the specific companies that fit your ideal client profile.
Once you know the companies that fit the profile, you also need data on the key decision makers and influencers in each of these companies.
What To Do With The List
These ideal clients and prospects should be clearly marked in your CRM and marketing automation systems. This makes it possible to track metrics around sales and marketing processes such as:
- Sales
- 100% Management of ideal clients
- 100% Coverage of ideal prospects with prospecting
- Marketing
- Communication cadence with ideal clients
- Outbound marketing to ideal prospects
Processes can be created, trained, and documented in each of these four core areas.
Step one is to get clear about your list. The more focused your Ideal Client Profile, the more you can focus your marketing and sales efforts. This will help you accelerate your growth.
by Bill Poole | Aug 20, 2020 | Sales
Want to grow revenue faster? Increase your pipeline velocity by reducing the friction between stages. How do you measure this? Here are two sales pipeline metrics to look at that can make a huge impact on your top line on the P&L:
- Conversion Rate: The % of clients that move from one stage of your pipeline to the next
- Time Spent in Stage: The amount of time that prospects spend in each stage of the pipeline
Stage Conversion Rate
The first thing to measure is the conversion rate between each stage in your pipeline. Simply calculated, what % of clients that come into any stage of the pipeline move to the next stage.
Here is a simple sales pipeline as an example:
- Qualify: 50% of qualify calls result in assessments
- Assess: 75% of assessments lead to proposals
- Propose: 25% of proposals lead to a signed contract and move to implementation
- Implement: 90% of clients finish the implementation and become clients
Most CRMs track these metrics as a default feature, but most sales teams do not closely consider how they can impact Stage Conversion Rate. Let’s look at how a 5% improvement on each stage can impact a business that has 50 opportunities per month move into a pipeline with an average transaction value of $50,000:
Using those example metrics, only a 5% improvement in each stage results in a 49% impact on Annual Revenue.
Time Spent in Stage
This is not a new metric either, nor is it hard to track. But, few sales organizations consider this metric as a way to impact performance. The time spent in each stage impacts:
- Business cash flow
- Sales productivity
- Cost per transaction
Let’s look at this metric a bit closer using the same simple pipeline example:
- Qualify: 3 days
- Assess: 2 weeks
- Propose (includes Proof-of-concept and negotiation): 2 Weeks
- Implement: 2 Weeks
Fair to say that these 2 metrics have a huge impact not only on your sales team but on your business as a whole. Easy to say, but how to you do it?
How To Reduce Pipeline Friction
Prospects encounter what we call friction as they move through the various stages of their buying process. Friction comes in the form of their own mental blocks that might be typical of each stage, or can unintentionally stem from your sales process. Here is an example of each:
- Mental Blocks: The natural tendency to resist change
- Your Sales Process: A proposal that does not clearly communicate ROI.
There are 2 approaches to minimizing friction to realize the results that you saw when you calculated the impact on your business using the calculator above:
- Align and improve the client experience
- Leverage content that helps your prospects navigate your pipeline
1. Align and Improve the Client Experience
The first step is to create an “ideal client” experience by broadening your sales process in both directions including both your top-funnel lead generation and your client stage of your pipeline. Ensuring that sales, marketing, and even operations are aligned with this experience is the first step in impacting the 2 metrics.
The second step is to have a process in place to continually optimize each stage in your experience to minimize friction to improve conversion rates and minimize the time spent in each stage. This approach will also help improve your actual “client” stage.
2. Leverage Content to Answer Questions
Ensuring your prospects and clients have their questions answered as they navigate your experience is critical to reducing friction. A simple 2 step process can put this into motion:
1. Implement a process for content creation that answers your clients’ questions as they navigate their experience with your organization. This process needs to be implemented into the culture of the organization with input from sales, marketing, and operations.
2. Put a plan in place to ensure the content gets in front of your Ideal Clients and Ideal Prospects. This plan involves leveraging this content in the following areas:
- Website
- Social touchpoints
- Phone prospecting messaging
- Email prospecting messaging
When all are on board with the Client Experience and the content plan around it, your clients have a more positive experience with your business. Maybe just as impactful, your sales team has 1 consistent framework to support clients through their experience as opposed to having 20 different approaches for 20 different reps.
Great News!: The top-funnel leads come as a product of your executing the above plan. What metrics are you tracking to improve your hit rate and accelerate your sales cycles?
Need help calculating the impact of your sales pipeline metrics? Download the worksheet, Calculating Sales Pipeline Metrics Impact.
by Bill Poole | Apr 23, 2020 | Marketing, Sales
As we have previously written, Buyers Don’t Buy Products, They Buy Outcomes. I see a perfect example of this as I look out my window into my driveway. I bought a car to get to the places I need to get to support the outcomes that I need:
- Enjoying our home in the mountains to bike and ski.
- Get to the airport to fly somewhere to visit a client or an occasional trip for fun.
- Sustain day-to-day life at home.
I don’t drive very often, but the car I drive is reliable, it allows me to transport my gear and delivers the outcomes I need. Quite frankly, it is less than impressive for anyone that would consider themselves a car junkie. Sounds like I may be cheap but trust me that the outcomes I need require plenty of investment over and above a car.
The outcomes that your business delivers should be woven throughout the operational as well as the sales and marketing aspects of your business. Let’s focus on sales and marketing given this is your focus if you landed on this blog.
Outcomes are in play at each stage of the process that you have in place to help your ideal prospect to become an ideal client:
- Marketing/Prospecting: Your marketing plan should be targeted to attract businesses that are looking for outcomes that your company can deliver. Remember, Buyers Don’t Buy Products, They Buy Outcomes, so product-centric messaging makes it challenging or impossible for the target to understand what outcomes they might get from your product.
- Qualifying: The goal of the qualifying stage of a sales cycle is to determine if the buyer is a good fit for the outcomes that your company can generate and if they have resources to pay for your product or service.
- Discovery: The idea with the discovery stage of the sales cycle is to explore areas of need that your prospects have. Needs for all potential outcomes that you can deliver should be explored.
- Proposing/Recommending: Your proposal should be communicated in terms of the outcomes that your clients will receive if they invest in you.
- Enjoying your services: Your operational team should be focused on maximizing outcomes for your clients. From a sales perspective, you need to gather outcomes — actual, quantifiable metrics — from happy clients when you conduct periodic business reviews. Those metrics should then be used in the other stages of the buying process to help communicate your value.
Having a resource, let’s call it an Outcomes Framework, shared by the sales and marketing team that is updated regularly, and shared centrally between sales and marketing provides many benefits:
- Alignment: Historically, sales and marketing teams are at odds with each other. Sales teams need marketing to communicate properly to prospects in a language they understand (outcomes and value, not product specs). On the other hand, marketing relies on sales to gather outcomes to help them create messaging. Both need each other to be on the same page, and an outcomes framework is a great place to start!
- Effectiveness: Outcomes-based messaging resonates with prospects, so win rates go up when communicating in terms of outcomes.
- Efficiency: Having a centrally-shared resource in place for an entire sales team makes it significantly easier for sales teams to prepare for all calls. Better yet, it can take fewer calls to achieve the same result. How happy would your sales team be if you were able to cut in half the time that sales reps spend preparing for meetings and helping them win more deals?
Leveraging an Outcomes Framework with real-world client success stories can be a game-changer for your revenue generation team.
