Stop Focusing On SAL’s!
SALs (Sales Accepted Leads) and the resultant SQLs (Sales Qualified Leads) are the Holy Grail of Marketing and Sales.
Everything we do seems focused both on improving the quality and quantity of these. The thinking is if we get the right volume, our pipeline problems go away, we easily make our numbers.
There are a lot of huge leaps in this thinking. One is the assumption that sales people are maximizing their win rates and deal values, providing great leadership, creating great value for the customers. But that’s not what this post is about.
The big issue is, should we be changing our focus? Gordon Hogg, has an outstanding post, Is sales and marketing focused on everything but the problem?
Gordon’s point is outstanding, at any time only about 4% of the market will say they are ready to buy or on a buying journey. Gordon poses the question, “What happens when we look at the other 96% of the market?”
It’s a huge issue and a huge opportunity. Let’s dive into this.
First, let’s look at the 4%, it’s those that become our MQLs, SALs, SQLs. But your competition if focusing on those as well, so it’s much tougher to compete. Even if we could identify all of them, we may not even get the chance to compete because customers may already have enough alternatives they are assessing.
But, the biggest issue about that 4% is that we are engaging them very late in their buying process. They’ve done all the heavy lifting, they’ve figured out their problem (correctly or incorrectly), they’ve started sorting out how they are going to make a buying decision, they’ve done a lot of research and self education.
As a result, we are involved in the smallest part of their buying process, our ability to differentiate ourselves, our ability to create value is seriously impacted, simply because the customer has done most of the work already.
Somehow, we need to get involved earlier in the customer buying process, but our MQLs, SALs, SQLs aren’t designed to do this.
This gets us to the other 96% of the market. Those who “aren’t ready.” Maybe we need to reconsider this. There’s a large number that may be ready, but we just haven’t reached in a meaningful way.
There’s a large number who may be in their buying process, but early on, they aren’t ready–but that doesn’t mean they don’t need help. For example, if we use Gartner data from a number of years ago, we know customers typically don’t get sales invovled until they are 57% through the buying process (other research shows it is much later). But they also show, at least 53% of buying journeys end in no decision made, and where they blow up is roughly 37% through their buying journey.
We don’t get visibility to a large number of organizations that have a need to buy and have embarked on their buying journey, but blow up and never become a SAL! This is both a huge opportunity, probably far more than the 4% we focus on, but this is where we create the most value and differentiation. The biggest challenge customers have is not making a solution selection, but developing and navigating their own process.
We have to figure out how to identify and engage them!
But that’s not all.
What about the majority of customer who haven’t recognized the need to change? Not all of them will need to change, some have already solved the problem. But a large number of them should change but have realized it. This is where insight can be leveraged with great impact. It focuses on people who have started the buying journey, inciting them to change.
All our marketing and sales efforts seem to focus on MQL, SAL, SQLs. But, somehow it seems to be the smallest part of the opportunity and the most competitive.
What if we started looking at the 96%, what might that do in helping us find opportunities and create value for our customers? What would this do to help us make our numbers?
AI And Sales, What We Misunderstand
Based on much of the press, much of it created by vendors of AI solutions, AI is the answer to all the problems we have with sales and marketing. We are presented a brave new world where we can engage the right customers, say exactly the right words at the right time, making sure we ask no more than 4 discovery questions, that our opening pitch(?) is no longer than 9.1 minutes, that…..
All of this, done under the auspices of AI or it’s companion, machine learning (ML) will be the answer to our revenue generation challenges.
Sales execs and sales people breath sighs of relief, “We don’t have to worry any more. AI identifies the customer, gives us all the answers, it even puts the right words in our mouths.”
If that scenario is true, one then can project the perfection of voice technologies, imagining worlds of chatbots engaging customers in the right conversation all the time—why do we need SDRs, AEs any more, why deal with all these people issues, AI/ML is the answer to our revenue prayers.
OK, so I’m exaggerating a little–but not by much–at least when one reads the articles or talks to people anxious about the technology.
Actually, I have great hope for the application of these technologies in marketing and sales. Having co-founded, built, and sold one of the early AI start-ups, and now serving on the boards of several others. I think I understand some of the possibilities. At the same time, I’ve seen many of the challenges and the things that AI just can’t do.
AI offers great promise in helping better identify, segment, and target our prospects. It offers great promise in helping us identify the moment in time when there might be a higher propensity to buy. It gives us insights and helps us identify patterns that would have been impossible to recognize without the technology.
Of course, much of this isn’t new. In some sense it offers us more of what we already have–but aren’t using despite having them.
For example, for years we have had analytic and marketing automation tools to better segment, better tune, and refine our marketing and content outreach to customers. For years we have had the technology to “profile Dave, understand what he is interested in, understand the content that resonates best with him, and get it to him in an impactful way.”
This is nothing new, yet why am I and millions of others inundated with the same meaningless drivel, every day. For some reason, these companies who should know what I want, what I have responded to, feel the need to send me (and you) everything. Much of it seems to be an old advertising mentality where measuring impressions is more important than understanding relevance.
And the phone calls, there is no excuse for anyone not to have a nominal understanding of who I am, what my business is, and what might resonate with me. For years, technology has provided outstanding solutions to help sales people be more relevant in engaging customers and prospects, yet fewer than 10% of the people contacting me appear to be using it. Their only concern is broadcasting their message to see if I respond (of course the right use of the marketing/targeting/segmentation tools should never have put me on most of their call lists.
I can’t help but have more than a little cynicism–not about the technology/tools–but how we implement and leverage them for impact. If we fail to exploit the capabilities of the technologies and tools we have had for years, will we be able to realize the true promise of these new technologies.
I think part of the answer to that lies in the naivete or possible laziness of the people buying them (and somewhat from the messaging of the vendors). One of the great discoveries we made in the AI based enterprise analytics company I co-founded in 2002, was that to exploit our technology we needed really smart people thinking about the right issues (in essence focusing and training the AI/ML) and really smart people to know how to leverage the results we could produce. We started qualifying/disqualifying prospects based on these criteria.
The same applies for today’s technologies. I think too many naively think the technology can do these things, that it does the heavy lifting of figuring things out. (One wonders why data scientists are among the most sought after people if this is true.)
But let me get to what I think the real misunderstanding of these technologies is, at least for the complex B2B buying environment. AI/ML is really bad at a number of things:
- Understanding context
- Consciousness
- Empathy
- Common sense
- Sense making
I’ll stop here. While AI/ML can help us understand potential answers and solutions, it can’t help us understand the right answer, because the right answer is always dependent on the customer, their context/experience, and a specific moment in time.
Ironically, the things these technologies are very bad at are the things that great sales people excel at. It’s these abilities that drive engagement and the ability of the sales person to create value with the customer.
These technologies offer great promise, as have past technologies. We have to be smart about how we exploit them. But these technologies fall very short in the things that are most important to our customers in complex B2B buying. We can’t fail to develop the capabilities in our sales people to help our customers.
Over the past several weeks, I’ve been involved in a number of conversations with colleagues and sales execs. Inevitably, we touch on the sad state of affairs on sales talent.
The data on churn (voluntary and involuntary) is horrible! Depending on the market data, tenure for managers and sales people is anywhere between 15 and 22 months. We are completely turning our organizations–management and sales people roughly every 3 years!
This is craziness! With onboarding (for complex B2B sales) at roughly 10 months, and sales cycles often exceeding 6 months, it’s no wonder that sales performance continues it’s downward plummet. People simply aren’t on board long enough to recover the hiring/onboarding investments we make. They aren’t around long enough to build their experience/competency, to build pipelines, to drive the business. Any success they have is likely to be a result of the work of their predecessor than their own success. As you run the numbers, you quickly see we are on a death spiral.
But it gets worse, as I talk to executives about needing to develop skills in curiosity, creativity, critical thinking, problem solving, collaboration, project management, orchestration.
Often, the reaction is, “How can I afford to invest in developing these skills, if the sales person is going to leave in 15-22 months?
We have this paradox, we need to invest in very advanced skills in order to effectively engage customers in their buying journeys. But it we have this revolving door of sales people/managers. How can we make this investment?
We need to break out of this thinking that churn is unavoidable! Accepting 15-22 month turnover as inevitable has to be unacceptable—it certainly is irresponsible!
Talent will be the single most important issue facing sales execs in the coming 5-10 years. We have to invest in acquiring the right talent, investing in their development, and retaining them.
Churn is not a law of physics. We create churn by creating work places that don’t value talent. We create churn by not developing our people or creating challenging job opportunities and companies that people want to be a part of.
Some will say, “But they are millennials….,” suggesting it’s the people not the company or the management policies that cause the churn. This is simply an excuse for uninspired leadership.
People, of all generations, want to work in places where they are challenged, developed, respected, doing something they think is important. That’s not a generational problem, it’s an leadership problem.
Our customers face accelerating turbulence—rapid change, disruption, overload, overwhelm, increasing complexity, transformation, risk, and uncertainty. They are crying for help. It’s the perfect opportunity for sales people to engage the customer helping them solve their problems. But to do this requires great skill.
Leadership at all levels need to step up to their responsibilities and to the opportunity. The opportunity is too big and too important. We owe it to our customers, our companies, our people.
Perhaps, rather than giving lip service to the idea that “people are our most important asset,” we all would be better served by executing on that idea.
Giving Them The Answers
Let’s conduct a thought experiment.
As one might do in experiments, imagine A/B testing. We’ll create an A group and a B group. The people in each group are identical in capabilities, backgrounds, experiences. Both groups are equally skilled and capable.
Now we are going to give people a test. It’s around some complex issues. Group A doesn’t have to study or prepare for the test. We’ve decided to given them the answers.
Group B has to study and prepare. We train them, we coach them. Some struggle a bit, but they learn.
Test day, 100% of the people in Group A pass the test as we would expect. In fact, we were a little worried that they would remember the answers, so we gave them the answer keys to take into the test with them. All they had to do was copy the answers from the answer keys. In fact, all of them got all the answers right—no surprise.
Group B, 100% of the people pass, but some of them struggled, they didn’t get perfect scores, but they all passed.
Now you are a manager. You need to hire people that need to do the things the test was testing. Who are you going to hire? You can select anyone from Group A or B. Remember, they are all have similar backgrounds and experiences. But you want to hire the people you think can best execute the things on which the test was testing.
You know that the test didn’t cover everything that people will confront, but you want to hire the person who is more likely to have the capability of figuring out the right answer to address the situation.
Who are you going to hire?
My guess is 100% of you would choose someone from Group B, perhaps you’d look at the scores and hire those with the highest scores.
Why do you choose the people from Group B over group A? Probably because they have demonstrated they have the knowledge to do the things the test tested them on. If those are the tasks that are important to doing the job, you want the people who have the knowledge to do the job.
We all recognize that the people in Group A, while they provided the right answers, they didn’t have the knowledge to understand why those were the right answers. They just copied the answers that we gave them, without understanding why they were the right answers to the test. They did what we told them to do.
This is important. Being effective in any sales role (or any knowledge based job) is not just a matter of knowing the right answers. It’s about being able to figure things out, to be able to understand the situation, understand what’s going on, and to assess the best answer/response for a specific situation.
You are probably guessing where I’m going.
If we want want to maximize the performance of our people, we know it’s important they have the knowledge to do the job. That’s why we invest billions in training. We also know, we won’t be able to give them all the answers, so the more knowledge and experience they have, the more likely they will be able to figure things out.
It’s also helping them learn through their experiences by coaching them and helping them develop the ability to figure things out.
The problem is, if we know all of this, why do we treat our sales people like the group A?
When, if, we coach them, why do we have the tendency to say, “Just go do these things, come back and tell me what happens?”
Why do we spend millions on scripting conversations, rather than giving people the ability to engage the customers in a dialogue?
Why do we introduce tools with “screen pops” giving them the best answer to a specific conversation (not to mention the “distraction” effect)?
We will never be able to provide our people with all the answers. Each situation they encounter is unique to both the situation, customer (enterprise/individual), and a point in time.
If we are to maximize the performance of our teams, if we are to help them have the capabilities to be helpful, creating value with the customer, we have to help them learn how to learn. We have to help them figure out what the right answers might be and how to leverage that knowledge most impactfully with customers.
Sadly, it seems too many are going the opposite direction.
