There’s a fundamental distinction between strategy and operational effectiveness.
– Michael Porter
The sales stack is messy
Last year brought an influx of new technologies to the sales world—ranging from automatic call transcription to social selling engagement platforms—promising no shortage of “solutions” to any and all sales problems. Eager investors followed, spawning a new technology segment representing over 300 companies with $10B in venture funding. However, with change comes complexity. How do salespeople find their way through this sea of new tools?
Your sales team shouldn’t be spending hours looking for solutions and self-testing—you should be on the forefront and solving problems before this happens. Remember: salespeople should be selling, not searching for answers to their problems. That’s your job.
PeopleLinx announces new release as sales tech landscape takes shape – VB Insight
And it gets worse…
The specialized sales model has added further complexity, leading to a fragmented marketplace of point solutions.
Outbound prospecting for highly targeted lead flow – David Skok
This proliferation of tools has done little to help the buyer make a choice. More to the point—who is the buyer? Traditional sales ops departments focus on optimizing sales processes and evaluating tools for efficiency, not necessarily competitive advantage.
Solution: The $500 Framework for Evaluation
As complexity increased in the sales process, many organizations, including Responsys (acquired by Oracle), formed departments dedicated entirely to driving revenue via productivity improvement. During my tenure at Responsys, I had the pleasure of speaking with Jason Lemkin during ToutApp’s Series A fundraising round. Jason made a very pointed directive that stuck with me:
Given $500 per month/rep, stack rank your spend on sales technology one through five
The $500 limit forces us to make a very difficult decision: which technology will actually move the needle for the sales person? This will often lead to the following stack rank:
- Salesforce (or similar CRM provider): ~$120/seat
Salesforce commands the #1 spot for the majority of organizations, as historical data is required to ensure every individual is up-to-date with the most recent customer interaction—what matters most is 2 through 5. CRM matters, but you need much, much more than a pure data warehouse. Data is the heart of every successful sales organization.
#2 & 3
The highly coveted #2 spot has several placeholders, however, what is often overlooked is how the potential technology can be integrated within a salesperson’s entire workflow. As sales becomes specialized, the Sales Development team has been an early adopter of sales technology. A recent survey of 70 Sales Development teams by sales consultancy firm TOPO found that 100% of teams had adopted LinkedIn Sales Navigator (a roughly $100/month purchase) – indicating a strong-hold on the # 2 spot. While LinkedIn holds the keys to a large dataset, their data is one-dimensional and lacks context.
As a result, sales teams have searched for data beyond the profile, which has spawned the creation of several data tools/services that serve specific buyer personas (DiscoverOrg for IT or InsideView for Sales/Marketing). These providers generally claim the #3 spot.
Sales Development Council #3 – TOPO
Data operates in a silo without customer interaction. Once future customer data is sourced, sales leaders generally shift their focus (and budget) to distribution channels for their message—email, phone, online conferencing, etc. The process of generating a live interaction (either in-person or online conference) requires investment in channels that can activate the buyer: email, phone, and social. Due to a large number of factors, email continues to be the most cost efficient channel for activation—and technology that facilitates lift in effectiveness and/or efficiency often secures the #4 spot.
In 1876, Scottish emigrant Alexander Graham Bell invented the telephone. The phone continues to be a powerful distribution channel in today’s business environment. However, with the advent of mobile phones and reduction in number of land lines, distribution effectiveness via phone has seen a steady decline. As a result, technologies that seek to drive operational effectiveness through power dialing and data are often landing the #5 spot.
The $500 Triangle
The modern salesperson (regardless of specialization) operates in an interconnected triangle:
- Data: (firmographic/individual): Needed to drive meaningful interactions
- CRM: Historical record and data source of prior interactions
- Workflow: Required to activate and conduct interactions
Using this model, sales leaders should assess potential technologies based on derived revenue impact to the associated triangle component. If we assume that the #1 spot is customer relationships management (CRM) then the #2 spot will include technology providers that deliver two-dimensional contextual data.
The race for staying relevant is on—causing consolidation across the technology landscape. This is particularly evident by an increasing number of integrations between technology platforms (Infer and InsightSquared, Outreach.io and Datanyze) and broadening of product portfolios (ToutApp Prospect Builder, SalesLoft Sales Dialer and KiteDesk REACH).
As the market evolves and bundles point solutions into platforms, sales leaders need to rely on their own metrics to make effective technology investment decisions. Death-by-case-study has become common, which is fueled by vendors trying to deliver value.
Therefore, understanding interaction conversion metrics throughout the customer journey will surface opportunities to solve bottlenecks:
Customer Interaction Funnel
Look for problems, not solutions
The sales function can generate differentiated advantage (read: cost leadership vs. differentiated advantage), however you must take a holistic view of the organization. You face a tough choice: New technologies can create value and drive customer experience, but how do you pick the right one? Do you focus on becoming an early adopter of a new platform to get first mover advantage among your industry peers? Do you hone in on existing processes and optimize, optimize, optimize to kill your competition with efficiency?
In part two, we will delve into the murky waters of collecting feedback, technology trials, defining success, and selecting a partner. We will provide a framework for building a business case and describe how technology can be used to beat your stretch goal.
Also published on Medium.