Live Post: Sales 2.0 Conference (Day 2)

Last Updated Mar 17, 2010 1:28 PM EDT

When I decided to live blog the Sales 2.0 Conference in San Francisco, I was fairly certain that I'd run across the kind of mind-bending data that would really change the way that we think about sales and marketing.

One of the companies (described below) used Sales 2.0 technology to achieve a 195 percent lead growth, a 100 percent pipeline growth, a 180 percent increase in marketing-created opportunities and a 50 percent decrease in marketing spend as a percentage of revenue.

How did they do it? They made Marketing subservient to Sales. Check it out, below...


Note: You may also want to check out the Live Post of Day One.

Drive Increased Sales Productivity with Sales 2.0
  • Mark Woollen, Vice President of Social CRM Products, Oracle. I've interviewed Mark several timesin the past, and my impression is that he's a smart guy. He showed it today by saying, at the start of his presentation, that he's not going to give a product pitch but talk about his customers and what they've been saying. He's taken 200 customer meetings in the past few years and identified some themes. According to his research, some customers are trying to differentiate on product, while others are trying to differentiate on process (customer experience plus product.)
  • The technical problems that they face in doing this are the classic transactional problems (lead gen, closing, etc.), but being able to analyze information and make better decisions, and finally trying to struggle with "social enablement" and collaboration between and among employees and customers. He noted that Increasingly customers are talking amongst themselves, which disconnects the vendor from the process.As a result you need to focus primarily on customer loyalty, because that's the only way to ensure that they're saying nice things about you.
  • For example, when people log onto a website, sales people need all the information that can create not just the original buying experience, but also the ability to build loyalty, which is then measured and leveraged. Brilliant!Another way to build customer loyalty is build programs that egnage customers on their smartphones, which people see as more personal than their computers. Loreal, for example, is using this to build loyalty, even though the business is being driven to the retail outlet.
  • As for sales productivity, the challenge is either to increase revenues, increase heads or increase quotas, all of which have drawbacks. Some customers are starting to rethink this bind by using analytics to create better leads so that sales people can focus on the best opportunities. For example, improving the performance by small increments (e.g. 3 percent), you double the effectiveness of top performance and reduce the impact of non-performers by a third. That gives you 10 percent more revenue. The message here: small technological change can have a big impact on revenue.
  • He pointed out that CRM is like a Little Shop of Horrors for sales reps. It just says: "feed me, feed me." The solution to this is to start thinking about technology that actually captures interactions so that they don't have to be entered manually. (A bit obvious, but well put.) Mark then tried to deal with the issue of "on-demand" versus "on-premise" by saying that "we do everything", which is pretty much the approach he has to take, since Oracle's product set is a pig's breakfast of stuff they've acquired as the result of the software world's most insane corporate acquisition pattern. He did the best he could with a corporate strategy that, IMHO, only makes sense to Larry Ellison.
  • My overall opinion: an absolutely fantastic presentation that contrasts favorably with any vendor presentation that I've seen at this or any other conference.
Sales & Marketing Alignment
  • Gerhard Gschwandtner Publisher and Founder, Selling Power magazine led an open discussion with the audience of companies that are trying to align sales and marketing. A manager at Eloqua pointed out that they compensate marketing on the consequent sales. Another manager from another firm stated that marketers should sell for six months before being in marketing; another manager suggested the reverse. Gerhard pointed out that this was the problem; the two organizations are still at war and not yet aligned. Later in the discussion, he pointed out the crux of this -- "make decisions based on science rather than hunches."
  • Kirk Crenshaw, Director of Marketing, Appirio. This firm is helps companies implment "cloud computing," mostly Salesforce.com implementations. Their challenge was massive sales growth, but everything that came in was considered a lead and they had a lot of lead generation activity (trade shows, webinars), but almost ALL of the real opportunities were (surprise!) coming from referrals and the sales team. (My comment: in other words, the typical useless marketing behavior.) They needed to get marketing and sales "on the same page." The first step: define what constitutes a valid lead. The second step: the marketing team only gets paid if they provide valid leads. They use several tools, notably Marketo, to nurture leads and track the process as the leads move through the pipeline. And that led to a third step: give the sales team control over marketing behavior, so that they can cut off marketing from interacting with a customer when the sales team wants completely control. Results: a 195 percent lead growth, a 100 percent pipeline growth, a 180 percent increase in marketing-created opportunities and a 50 percent decrease in marketing spend as a percentage of revenue. "It's completely transformed the company."
  • Brian Frank, Director, Global Enterprise Operations, Linkedin. Well, we all know LinkedIn, right? Well, they use their own product to do lead generation. (Who knew?) He thinks that having metrics and measurements help solve the problem but you need the right people in management to come to a personal alignment and define the core of the problem. At LinkedIn, for example, they have plenty of leads and they send the high-scored ones into the sales queues, where they were "untouched." Turns out the real issue was low-quality leads because the sales people don't think it's worth their time. The source was therefore inadequate lead scoring. They're using Marketo to fix this from a technological viewpoint, which makes it easier to adjudicate these arguments within Salesforce.com, which is their CRM system. They're also using Cloud9 Analytics to help replicate their successful sales.
  • Alison Lee, Product & Marketing, Muzak, The Internet has challenged their business because it's made everyone a DJ, so consumers want the same kind of choice in their ambient music. The competition has also increased. They're trying to integrate the marketing and sales with Silverpop to do web lead automation and are developing a lead scoring model. She's finding that the ability to do this is having an enormous impact on their ability to target their sales resources. Muzak is a family-owned business, which created challenges in terms of working with entrenched behaviors. She was able to overcome this by asking questions -- essentially doing internal consultative selling.
  • Tim Riesterer, CMO and SVP Strategic Consulting, Corporate Visions Inc. This firm helps companies with their messaging and have 10 direct salespeople. He believes that the key is getting a conversation between sales and marketing about how you communicate with customers. The problem is that many marketing groups come up with sales tools that can't pass the "snicker test" -- can you say it without snickering... They're using Marketo for lead gen and qualification (they chose them because they felt they had compatible corporate cultures.) Once the systems are in place, you have to get people to "care". Result: they went from 1 percent of the pipeline coming from Marketing to 45 percent. A key element of this was the use of Brainshark to spread the word and to help sales folk deploy content. He finding that pre-recorded webinars work better than scheduled ones because people watch them when they show up. He's also been able to cut marketing programs because they've been able to find which lead gen methods actually created profitable leads.
  • Nicolas Draca, Director, Marketing, Infoblox. They're a B2B reseller of network appliances, with 50 territory managers and 10 inside sales folk. They use Eloqua to do lead scoring and nurturing, but the sales team didn't understand the scoring system. The alignment also has to do with wording and vocabulary. When he changed the storing terminology to "hot lead", the sales people "got it." The measure sales cycle, conversion time, and cost-per-lead in order to tune their process. Side note: Nicolas has a French accent and makes jokes about it, but he really does sound like one of the Monte Python guys doing a fake French accent.
  • My opinion: it's what I've been saying all along, which is that aligning marketing and sales means making marketing an organization whose purpose is tactically servicing sales.
Sales 2.0 Training
  • Gerhard Gschwandtner Publisher and Founder, Selling Power magazine (Moderator). Gerhard ask the audience to estimate the degree to which selling is an art or a science. (Actually, I blogged on that in "Sales: Eternal Art or Evolving Science?") Kevin said 80 percent Art, Sharon said 50 percent Art and Tim said 20 percent Art selling to small firms and 80 percent Art selling to larger ones. Gerhard's comment: "customer don't want solutions; they want results." He also pointed out that if a customer wants a transactional relationship, just write the order; if the customer want's a relationship; build a relationship. Therefore skills should be designed based upon the customer and the sales rep should go in with a tabula rasa and adapt to the situation. This remark got some pushback from a guy who believed that customer need to be explained what they really need. Gerhard countered that if you build a relationship of trust, the needs will surface.
  • Kevin Biggs, SVP Worldwide Sales, Blue Coat. They're in the process of a growing portfolio with an explosion of training and marketing content. They chose DealMaker for their sales process, a new product from the TAS Group, that allows you to build a better process in Salesforce.com. They haven't started measuring the before/after difference, but they're seeing a fundamental growth in sales productivity based on amount of sales revenue per rep over time.
  • Sharon Little, Director, Global Field Communications, VMware. They're creating a contest to white board a presentation and make the content available, and letting people rate the quality of the content. That allows them to tune their content (which consists of 5000 pieces of information). She feels that measuring the impact of training based upon revenue is somewhat irrelevant compared to the opinion of the sales team about the training and how it's impacting sales. Her key point was that too much investment goes into the "science" and not enough into the "art" of selling. However, most of the audience seemed unsympathetic to this, since (after all) this is a technology conference....
  • Tim Oden, Managing Director, Business Development, Charles Schwab & Co., Inc. They went with Miller Heiman, spending the better part of year training sales people and their trainers to create consistency in the message. The key to training is to keep using the language of the sales process so that it become clear that this is not a fad, but an actual change in the way that the company is doing business. Result: they were able to positively coorelate the ability to be a top salesperson with the use of the Miller Heiman system, at which point adoption went "through the roof." They measure the impact of the training based upon the amount of revenue that the sales reps bring in. He feels that the scientific view of training is essential because so much of the sales environment is changing so quickly.
  • My opinion: The big controversy in this discussion was how to measure the impact of training. Sharon believed that granuality of measurement wasn't all that useful while Kevin's viewpoint was that it was too hard to measure comparatively when you're growing quickly. Tim's viewpoint was that all of that may be true, but you still need to measure with precision. The discussion about the "art and science" of selling was also interesting, because the viewpoints were so disparate.
Kodak's Successful Fight for Survival in the Digital Age
  • Jeffrey Hayzlett, Chief Marketing Officer and Vice President, Eastman Kodak Company. Five years ago, they were doing $15 billion in consumer film. Today they're doing less that $250 million. They were obviously faced with a change -- do it or die. So they needed to do something differently, and quickly. Their business was a traditional business that made film. They had invented the digital camera in 1976, but put wraps on it because it was competitive with their cash cow. They're now doing 70 percent of their business and 90 percent of their revenue on digital products and most of the business coming from the B2B model (which is why they're not advertising on television any more.) They've also shifted revenue so that it's distributed around the world, with revenue coming from 13 businesses, all of which are #1, #2 or #3 in their categories.
  • Kodak needed to transform the brand, because the old brand had a "buggy-whip" flavor to it. However, they had a fairly good tie-in to their customer's emotions as in "A Kodak Moment" -- a tag line that they're planning on bringing back, BTW. This involved changing the website from a standard B2B brochure-ware into something that leverages some of the exciting things that people are doing with the product, including the Obama white house. Similarly, they took Oscar winners and asked the cinematographers to give them the key scene. The idea is to create a website that's drawing big pageviews numbers.
  • Kodak has completely refocused their branding efforts so that it points at B2B markets, such as sponsoring holes in golf tournaments, offering money for people who successful do the "Kodak Challenge Hole." He is, in effect, using "other people's money" to publicize his brand name, getting $64 million in free advertising. They're doing product placements in movies like the upcoming Iron Man 2. They're sponsoring the Celebrity Apprentice with Hayzlett as a judge. He wasn't just bragging, but making the point that you have to take bold steps and think creatively if your company's revenues are going down the toilet.
  • Kodak is a heavy user of social networking and engages in conversations with customers who complain. By interacting with customers, they are able to reduce the amount of venom that gets into the system. They also capture the process where they can have a modicum of control over the conversation. Engaging this way has ended up modifying product designs so that they have a much greater demand, even for products that haven't had any manufacturing. (This is a process called co-creation and basically replaces all that nonsense from marketing about "product requirements.") Quote: "Engagement is the new ROI." He ran an online contest to name their new product, changing from a number-based product naming convention (e.g. "Kodak Zx1") to a user-named convention (e.g. "Kodak PlaySport.") Hey, so much for all those branding guys in the "strategic marketing" group, eh?
  • My opinion. Jeffrey was one of the best corporate speakers I've ever heard. Engaging and funny. As for his message, here's an illustration of what he's trying to get at -- a video recorded from a Kodak Zx1 camera and uploaded to YouTube, all done while I was actively blogging this post. It was THAT easy to use. BTW, Jeffrey owes me a BIG vote of thanks because I was the person who was personally responsible for delaying Polaroid's entry into digital imaging for five years. It was pretty much by accident, but it's still quite true.

Social Networking & Sales: Definitive Success Strategies for the Facebook Era
  • Clara Shih, Author, The Facebook Era. She noted that social networking is "the new Internet" in the sense that it's the collection of the relationships that matter to us. She calls this the "Facebook Era" but she's really referring to the entire social networking. Over a third of all people on the Internet are using Facebook which has 400 million users. Therefore most customers are on Facebook. She pointed out that this massive adoption is turning Facebook into a mainstream marketplace, causing 74 percent of companies considering social media as a top priority in 2010. (Interestingly, social media spending is much smaller than search technology.)
  • To be successful on Facebook, you need to understand profiles (your personal profile) and pages (which are corporate), and how ads and applications work. In order to be effective, you also need to understand the dynamics and social norms that develop on facebook. The heart of this is the profile which expose your identity and relationships which has now, in her view, become socially respectable. Facebook has an advertising system that targets specific profiles and is trying to be the propagation point for people's identification on the web. This also reduces the cost of getting and keeping in touch with one another. This makes it valuable for casual relationship that otherwise wouldn't have been pursued.
  • Selling via Facebook depends upon "transitive trust" that's based upon the social connections that one has already built. One can borrow the trust from another relationship recommendation and referral. This is not uncommon (referrals being a standard lead gen method) but the difference is that with Facebook it's automatic. She pointed out that, according to one study, the most trusted source of information is from people you know. She spotlighted an application she built for Facebook called FaceConnector, which goes out to Facebook and find the people to whom you're connected.
  • She walked through a sales cycle. She started by checking out the LinkedIn profile to get a feeling for the contact, and then going deeper into the discussion that they're having. You then try to catch them right around when they're complaining about things because then you know their pain points. She then showed how you can use social networking and Facebook to check the progress of your sales cycle and better understand what people are doing. She wants to try to get to know people better through their personal stuff, including needs analysis. Clara then showed a somewhat typical example of using demographic information (this time from Facebook) to do targetted marketing and guiding the bidding process for online advertising.
  • My opinion: The main problem that I see with Clara's premise is that some people -- indeed most people, I suspect -- prefer to keep their personal life separate from their business lives. I've blogged the equivalent of several hard copy books of material and have put exactly two references to my children, which turned out to be germane to the discussion. Why would I want to tell the world about my other interests? I believe that she's missed the point and that most people will create multiple personas which identify segments of their lives. She did mention that Facebook supports multiple "friend groups" allowing you to control who knows what -- but what does that say about mining the information?
  • Frankly, I think that it can be a big tactical error to bring up too much personal stuff early in the sales cycle. Example, I once googled up the fact that one of my editors was into model rocketry -- one of my former hobbies. He was not amused and had clearly hoped to keep that geeky part of his life secret, even though I was clearly just as geeky. There's also a problem when you contact people who you don't know well because they'll assume, if you have a personal reference, that it's just a bogus online one. Another example, I happened to have worked briefly on a project with an editor whose brother is a famous animator. I happened to buy a book by the animator and email the contact to ask if it was a relation. It was, but I could tell that the editor thought I was just chatting him up and had no real interest in his brother. I can sympathize with both these guys because, frankly, I find it offensive when people whom I don't know well comment on parts of my life that are irrelevant to my business.
Concluding Comments
  • Gerhard Gschwandtner Publisher and Founder, Selling Power magazine emphasizes that it's not science but people who really matter. It's the people in the room and their excitement with the technology that makes the difference, not the technology itself. This kind of conference can only build awareness, but it's not meaningful until you actually use it in a real sales situation.
Sales 2.0 Beer Bash & Video Shoot
Folks, I'm gonna relax for a while. If anything happens of interest at the beer bash, I'll write about it later. Tomorrow, back to the typical Sales Machine. Great conference.
  • Geoffrey James

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