Partner Selling
If there’s one thing that vendors and channel partners agree on, it’s selling. More or less. Everyone agrees that more selling is better but the discussion can diverge greatly from there. Vendors and their partners are not immune from the virus that affects direct sales people. We often hear direct sales people say their leads are no good and we hear marketing say that sales doesn’t follow up. Sound familiar? Of course it does.
The name of the game in sales is finding the fastest route to the cheese, so to speak, and anything that slows down the transaction (or the mouse) is suspect. In the real world, we all know that customers are not simply purchase order generators and that selling takes work but this shouldn’t be taken to mean that the marketing and sales process can’t be improved.
Marketing gets a lot of attention because today’s marketing automation platforms bring some scientific rigor to the process. Better marketing makes better leads and better leads make for shorter sales cycles and happier partners. That all sounds good, but how do you get there? Here are some tips.
First, stop giving every lukewarm bit of customer response to a sales person with a mission to bring in the business. It’s not a lead — yet. If a prospect downloads a white paper for instance, it certainly shows some kind of interest but what kind? Is the prospect looking to buy something or is a grad student writing an MBA thesis?
Marketing automation is popular today because it provides lead nurturing. Instead of handing over such “leads” to sales people, marketers hold onto them and put them through nurturing processes that aim to capture more information such as who the buyer is, what the business problem is, whether or not there is a budget. Only when such information is in hand does a modern marketer release the lead but this brings up a challenge for the vendor-partner relationship, namely, who is responsible for lead nurturing?
The answer is it depends. It depends on the nature of the product, relationship, and market. Ideally both parties should engage in some kind of nurturing — partners can’t expect all of their leads to come from the vendor. This means vendors and partners ought to come to some agreement on how to approach the market and what defines a lead. This is part of the value a vendor brings to the relationship.
Second, and many partner programs already have this down, a vendor needs to have some standards about lead handling. There should be mutually agreed SLAs (service level agreements) in the channel defining how quickly a partner contacts a vendor lead AND reports back on it. There’s nothing worse than nurturing good leads only to have them ignored. A modern PRM system can usually handle this and it is one of the best reasons to have one.
Third, the vendor must be able to track and report on lead disposition. Metrics for first touch, follow up, close rate, wins, losses, and no-decisions, and similar things can help a vendor in determining how to share leads and ultimately participate in stack ranking vendors. Having your PRM integrated tightly with your CRM and Marketing Automation platforms makes this effort much easier.
Of course, partners should have the ability to accept or reject leads once they’ve done their due diligence. This is completely analogous to direct selling where marketing generates a marketing qualified lead (MQL) and sales verifies it as a sales qualified lead (SQL). Sadly, it is not yet state of the art in many partner programs.
Rejection is often a good indicator of the lead generation process’s effectiveness. If too many leads get rejected it might indicate that they’re too raw going out the door and a need for better nurturing. But if an individual partner has a consistently high reject rate along with a poor win/loss ratio, it might say something about that partner. That’s why it’s important to capture partner data throughout the deal funnel and to analyze it.
Too often we hear that marketing and selling are not exact sciences, like physics for example, and that’s right. But they are sciences nonetheless, just more like economics and sociology or anything that relies on a Bell curve. Using analytics and metrics to understand the fat middle of your curve and to identify your long tail outliers can help any organization improve marketing and sales and that will improve the effectiveness of your channel.
Marketing Automation’s Next Gig
If you aren’t sold on marketing automation yet, there’s another reason to consider it before you end up down two touchdowns with three minutes to play. We usually think of marketing in its traditional role of new customer outreach, which is good but no longer enough. Depending on a business, as much as 80 percent of revenue might come from the existing customer base, however, the marketing budget usually goes in the opposite direction. It’s good to keep in mind that in today’s zero-sum markets, your competition has not stopped marketing to your customers, so why should you?
It is certainly true that the outreach you should make to customers is different from what you do for prospects. Customers have already bought your basic value proposition but the mission with them is to ensure they maximize their return which will conveniently set up a cross-sell, up-sell, or renewal, and who doesn’t want that? So, a marketing program aimed at customers might just as easily focus on delivering a piece of useful information, such as a best practice, as it focuses on setting up the next sale. In fact, it should.
This is cool because at base level, it’s all about using marketing automation technology to deliver a message and that’s standard marketing. But you also know a lot more about customers than you know about prospects so you ought to be able to leverage that knowledge in your outreach.
The same marketing automation technologies and analytics you use to promote products and services can be used to support customer nurturing. Before these technologies existed it was hard to capture enough information to make these programs effective and some vendors discovered that their attempts through generic email or direct mail, only aggravated customers. Also businesses relied more on customer service to provide some nurturing but waiting until there is a reason to call for service limits your ability to offer other products and services. Finally, in a self-service world, the opportunities for contact are diminishing. So in a sense, marketing automation has given us a new avenue to the existing customer.
You should start by collecting financial and use data about customers from other departments, and you have a good idea of your customer lifecycle then you have the elements you need to discover which customers might be happy and which might need some form of assistance or which could benefit from new information. With that you can tailor nurturing programs to different populations.
So, for example, you should be able to pull up a list of customers that are nearing the end of a lifecycle or who need to renew or who could benefit from some new information about best practices. Also, you might ideally start a nurturing campaign well in advance of asking for the renewal so that the customer has time to have several positive experiences. That will make the renewal process an assumed close rather than a long negotiation.
If you already have marketing automation and analytics it’s really just a matter of developing some meaningful campaigns and content. If you don’t yet have marketing automation, it’s another reason to look into it. Customer nurturing can help turn more marketing programs into revenue generators. And with analytics it’s easy to track the results and prove the value.
Subscription companies are pros at this because their survival is tied to it. Subscribers have the ability to go to another vendor any time and for any reason. So they invest heavily in capturing customer feedback — even if it’s indirect — and developing responses. They’re naturally attuned to listening to customers and to generating programs that help customers improve ROI and ultimately buy more or renew. It’s a good lesson for any business.
Marketo’s Show
Hillary Clinton speaking with Phil Fernandez, CEO, Marketo
The overall impression I got was that modern, statistical and analytic marketing is still in its early phase though few people I know need to be convinced about its usefulness and efficacy. You could see evidence for this belief in the products and product introductions, the breakouts, and in the speeches.
First the speeches. In addition to CEO Phil Fernandez’s keynotes there were appearances by Democratic presidential front-runner, Hillary Clinton and GE’s powerhouse CMO, Beth Comstock. Each woman’s appeal to the largely female audience was obvious. They are role models for many and an inspiration for any woman wanting to climb the greased rope of corporate success. Each spoke about the challenges of being a woman in business today but I thought Comstock came closest to the mark when in the context of marketing she said that sometimes you simply need to give yourself agency to try something. That’s an avenue not as easily exploited in politics where as Clinton pointed out consensus building is important and sadly absent today.
The theme of the event was innovation and while Clinton, who spoke on Day 1, is no technology expert and not a marketing professional, her vast practical experience in modernizing the State Department by embracing the Internet and social media and her knowledge of how to sell an idea, which was honed in decades in the political arena, provided a great foundation for discussing innovation in a broader, national context. Clinton’s message concentrating on the truth that we are all people and that we need to coexist was not lost on the men in the audience either.
Comstock spoke on the second day and gave a more focused discourse on what it means to be a modern marketer in one of the largest, most innovative, and geekiest corporations on the planet. Her message was that marketing has to take the lead in inventing itself, to find markets and opportunities for innovation in order to take its rightful seat at the boardroom table. She told of instances in GE’s diverse portfolio from jet engines, to locomotives, power systems, and healthcare where marketing found product opportunities and developed markets for them. The keys to success — and there were several — included bringing business ideas where marketing can quantify results and not simply existing to produce content, a message well in line with Marketo’s ideas about marketing.
At the keynote level, Fernandez allowed himself a brief moment on stage to take in the company’s success symbolized by the throng in the hall. The company introduced new and improved products for calendaring, SEO optimization, and personalization, all of which are in demand as building blocks of modern marketing. Fernandez also hammered on the continuing need for innovation in all things marketing related as companies continue to face great challenges driven by the pace of business and the ferocity of competition.
When it got to the breakouts, and I didn’t go to all of them, the vibe seemed to be how to help marketers to do more than adopt the basics and to exploit the breadth and depth of marketing automation. This is no surprise for any breakout session but for a still new market that is past its early doubters but still gaining altitude in the executive suite, the sessions offered practical advice for things tangential to marketing such as how to work better with sales. There is a great thirst for this kind of knowledge and knowhow among marketers.
Especially illuminating to me was the amount of discussion about marketing’s interface with sales and for me this was troubling, not for marketing but for sales. Of all the disciplines in CRM today, sales appears to me to be the one that has changed least over time and that’s not good. Sales is the practice area least affected by CRM, where people are still allowed to fly by the seat of their collective pants.
I say this not to be provocative but to bring together several threads. First, the urban myth that sales force automation does not work refuses to die, second, according to CSO Insights, half of all organizations surveyed still don’t have a recognizable and implemented sales process. Third, and perhaps most troubling to me, too often the discussion between marketers has turned to questions of how can we effectively work around sales if it insists on its recalcitrant ways? Too much of marketing automation’s effort seems to be in devising ways to capture customer data that provides the feedback that sales ought to be giving. At least that’s what I saw.
My concern for sales is that it will remain stuck in its rut too long and that market forces like the automation provided by ecommerce and subscription sites augmented by the information flow provided by marketing, will serve to make selling and its practitioners redundant. As markets and categories mature a certain amount of retail-ization of the sales function is inevitable. However, sales people who are still avoiding formalized processes and technology are making the inevitable too easy.
The sales function was not on trial at the Marketo event but as an analyst I routinely look at what is and wonder how it will evolve and my conclusion left me wondering about the future of selling.
Setting Goals and Rewards
You should check out “The Second Machine Age” by Erik Brynjolfsson and Andrew McAfee of MIT. It’s a thoughtful analysis of the technology progression handed to us by Moore’s Law and its effect on every aspect of our lives. Their thesis is pretty simple but also powerful.
Early in the computer age, we developed transactional systems designed to give us the data we needed to make decisions but over the last ten years or so, the pace of innovation has accelerated. Systems have become increasingly sophisticated and capable of not only giving us the right answers in business, but also managing increasingly intricate business processes. Processes that were only imaginable before are becoming easy and such is the case with managing people.
One of Brynjolfsson and McAfee’s predictions for the future of business is that technology will become increasingly valuable as a way to augment human abilities and behaviors. But their analysis cuts through the idea of the all-powerful computer such as the chess playing or Jeopardy! winning cousins Blue and arrives at a more satisfying conclusion that those businesses that do the best job of harnessing humans and computers to work together will be the most successful.
Perhaps a classic example will be in how we manage people. Given a choice many managers would rather wrangle cats than direct humans in part because incenting humans and tracking their progress toward a conclusion so that the right reward can be given is a low productivity process full of twists turns and lost data.
Until very recently, managing people was a matter of supplying goals and incentives to be followed later by accounting the results and calculating rewards. Unfortunately though, the process quickly gets out of hand if managers have many people to manage along with day jobs that come with goals and incentives of their own.
People naturally find the easiest ways to reach their goals like a mouse in a maze goes for the cheese. So, the end of quarter accounting too often starts with reminders of the original goals and back of the envelope calculations to derive percent of attainment.
Such is a “good” system. A less than good approach is to forget the beginning incentive and goal setting and to arrive at a bonus amount that is bestowed less as a reward than as manna from heaven. No wonder then that motivation sags in many businesses. People don’t really know what’s expected of them and good work, while hoped for, is treated as a miracle rather than the result of a plan.
This can now change because systems are becoming generally available that help managers combine the number crunching and data gathering capabilities of technology with the right brained, creative, goal setting and motivational talents of the best managers. In other words the MBO can now be much more than an aspiration learned in business school and promptly shelved in the real world.
Teaming managers with systems that actually aid in management processes and not just calculating results can turn the difficult and time consuming people supervision process — including goal and reward setting — into a rigorous and time saving science. More importantly, using systems that manage MBOs has another benefit. Rather than waiting until the end of a reporting period to ask, “How did we do?” managers can now ask the more useful question, “How are we doing?” at any time in the reporting period.
The obvious benefit of this approach is the possibility of knowing where things are succeeding and where the sledding is tougher in time to intercede. This is managing by exception, one of the more useful tactics that managers are tasked with. But now, leveraging appropriate systems managers can actually intercede where their efforts will do the most good and they can do it on a consistent basis.
All this suggests that in the second machine age we might reconsider and reconstruct the very idea of work. Well-tuned goals and incentives can be managed anywhere any time with less emphasis on employees reporting to a building every day or working these hours or these days but not those.
Best of all, because it will make this new paradigm more palatable to all parties, research shows that moving as little as 3 percent of employee compensation into well managed MBOs is enough to move the needle. The key is managing well. Employees quickly go from gaming a system imposed by others to strategizing how to maximize a set of incentives constructed expressly for them.
The second machine age will be a time for recalibrating the relationships between people and computers, the work-life balance, and among people. Goal and reward setting will be small ways to accomplish some of this but its impact will be great.
Marketo Marketing Nation 2014
Day one of the Marketo Marketing Summit 2014 was highlighted by a speech by possible presidential candidate Hillary Clinton who spoke about the intersection of social media and the Internet during her tenure as Secretary of State. Clinton is no technological light weight and gave example after example not only of how the State Department adopted modern communication methods, but she also showed where we collectively as a technological society need to go in not only communicating but in leveraging technology. As a speaker she graciously stayed on the topic, innovation as applied to marketing. Perhaps that’s not her sweet spot but she stuck with it and it impressed the audience.
Marketo CEO Phil Fernandez was happy to serve up a mix of hardball and softball questions in a discussion after Clinton’s speech, which she handled with good humor, even the inevitable are you running for president question. Here I thought Fernandez got further than most professional journalists whose questions have been successfully parried by the non-candidate and Democratic front-runner. Answering Fernandez Clinton said she was “Thinking about it.” Such is the stuff of reading political tealeaves.
If you ever doubted Clinton’s appeal you should have been in the mostly female audience for whom Clinton is something of a hero and a role model. Her comments were designed to appeal to the audience of mostly center left people and women. For instance, when asked about immigration and jobs her response was a measured, let’s form public-private partnerships. And although that’s a good idea, it skirts somewhat the larger issue of getting the economy moving again. I would have liked a response like that but then again that’s the kind of thing a candidate proposes, not a private citizen. Alternatively, perhaps that makes me somewhat left of left. I dunno.
Day two starts shortly and I expect to get more detail on Marketo’s many announcements.
