Finding new ways to win new customers
Clarify’s CEO Claire Edmunds discusses new ways to win new customers in the era of the fourth Industrial Revolution, stating UK businesses need to sell big, sell global and stay relevant. The article can be read in full in the Q417 issue of the International Journal of Sales Transformation.
Finding new ways to win new customers
In the current uncertain climate it’s time for UK businesses to sell big, sell global and stay relevant
The pace of technological progression and the impact of globalisation are increasingly disorientating. Society One is one of the world’s fastest-growing lenders, but does not own the money it loans; Google is the world’s largest software vendor but it doesn’t own any apps. From consumer to business, industry is mutating and business roles are being reassessed, reconstructed and repurposed.
Steam-powered locomotives revolutionised global transport in the first industrial revolution; today we are seeing the dawning of what many are calling 4IR or the fourth industrial revolution – with the rise of The Internet of Things, artificial intelligence, biotechnology, machine learning (amongst others), the rate of change continues to accelerate.
Failure to embrace this digital disruption can have dramatic consequences: Kodak and Blackberry, are frequently held up as red warning flags for complacency. Kodak, having invented a digital camera back in 1975 failed act quickly enough to capitalise on this new technology due to a 1981 board report arguing that it had ten years to act. More recently Blackberry failed to grasp the reality of consumerisation in mobile phones, which resulted in its spectacular fall.
What will the scale of change be like as we move into this new era of IoT, AI and machine learning? UK growth is currently relatively weak and the country faces a productivity challenge. To support its growth aspirations, UK business must create an environment in which innovation is prioritised, with business models founded on digital and other cutting-edge technology – in effect every business should behave like a software business.
To quote Spin Selling author Neil Rackham, ‘when the economy goes down, the decisions go up’. Against the financial backdrop we have described above, traditional buyers are being replaced with line-of-business stakeholders; traditional deal types, – and how we win these deals – are changing with them.
Some 85% of B2B customers now start their purchasing process via referral, with peer recommendations influencing over 92% of buying decisions. This represents a great disintermediation of salespeople from buyers.
This problem is exacerbated by the dramatic rise of ‘decisions pending’ deals that are clogged up in purchasing pipelines across the world. These deals, which are simply awaiting a decision, are now responsible for 27% of opportunities forecast and pursued by salespeople1. They are valued at $20tn globally2, meaning that there is often more money to be made in unlocking frozen decisions than making new sales approaches.
The challenge is that board members of these businesses are not technology experts. They need help to understand what is worth placing a bet on. Tech sales leaders have a duty to communicate what their organisations can offer other businesses that often have no knowledge of their product.
Three key messages
Salespeople need to promote change, create new patterns of thinking and offer challenging insights. When buyers refrain from making a decision and continue in their current state, they are either unconvinced to enter a different end state or haven’t been equipped by the salesperson to make the case for change within their organisation. With buying decisions in large enterprises taking at least six months – and this is expected to lengthen as risk-adverse decision makers take more purchasing decisions by committee – sales leaders can support new stakeholders and their boards by articulating three key messages.
1 – New ways to win new customers
Many technology businesses with high-value complex sales engagements find themselves getting 80% or more of their revenues from a tiny proportion of their market. As legacy propositions commoditise and margins are eroded, growth stagnates.
Businesses know they need to find ways to win new customers, take new propositions into existing customers and increase the strategic value they deliver; but the strategies deployed to achieve this are often failing.
Why? It is the newer value propositions that are the route to increasing wallet share in existing customers and winning new customers; however these propositions are also the hardest to sell. New concepts are harder to articulate, clients do not immediately recognise how they will get a return on their investment, so salespeople must access different buying centres – usually engaging with more senior individuals, as organisations will view these investments as higher risk.
2 – This quarter, next quarter
While enterprise field sales teams may have the knowledge and skills to handle these challenges, they are focused on opportunities that will close this quarter and next. Often they may not have the bandwidth and are too expensive a resource to concentrate on building new pipeline. Equally sales leaders may have invested in creating a demand centre, which meets the needs of a run-rate business but doesn’t work for newer or more complex propositions.
3 – A wise investment
Sales leaders are increasingly realising the need for a dedicated best-in-class business development function. This function should be able to articulate complex messages to senior executives, use the same advanced sales skills and methodologies that enterprise field sales teams are deploying, build and execute target account plans in conjunction with account managers and work collaboratively with field sales to develop the opportunities they find beyond the first engagement to maximise the pipeline generated, reduce funnel leakage and ensure that sale expenditure is invested wisely.
The key takeaway is that sales leaders must challenge and transform the structure of sales to generate scalable and predictable pipelines, improve win rates and drive profitable growth. This must occur hand in glove with building enterprise in new and existing markets. Now is the time to sell big, sell global and stay relevant, not only does your sales function depend on it, UK prosperity demands it.
1, 2 – Ian Mills, Mark Ridley, Ben Laker and Tim Chapman The Salesperson’s Secret Code – LID Publishing August 2017
About the author
Claire Edmunds is founder & CEO of Clarify, a professional services business specialising in strategic business development.