The Circuitous Route to Sales

Posted in Sales by Keith Thompson on the May 1st, 2006

Most salespeople arrive in their profession in a roundabout way. Most have already spent some time in their industry doing something totally unrelated to selling. But if they get involved, as many do, with supporting the direct efforts of the company’s dealings with the customer, they are often enticed to cross the line—to get permanently involved in the most important customer facing process, that of sales.

A direct result of this circuitous route to the job of selling is that many salespeople never get a logical step-by-step grounding in the language and science of their profession. A recent article in the Wall Street Journal pointed out that most Universities shy away from implimenting comprehensive programs that teach sales, even though corporate America wants them to do it.

I’m not saying that salespeople don’t get trained, they do. But the training is almost always centered on the immediate needs of the sales team, driven by strategic and tactical considerations. Consequently salespeople are drilled on what to do and say in front of a customer without having a firm understanding of the sales cycle and the fundamental characteristics of the sales opportunity itself. This is why so many salespeople have trouble with forecasting—they don’t understand how to recognize the value of the sale, and what factors determine it. This ignorance is compounded by misunderstanding the underlying dynamics of the customer’s buying process, which means that it becomes impossible to make worthwhile predictions on when the sale will conclude. Faced with this, Managers have a tough time in predicting future revenues, which in lean economic times can have an adverse effect on the health of the business.

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Retention or Acquisition, Revisited

Posted in Sales by Keith Thompson on the December 5th, 2005

I received a comment to a previous post that got me thinking. It seems that there needs to be parallel efforts in maintaining both Acquisition and Retention, with equal focus, and not one at the expense of the other. In my post I said I thought that Acquisition was the mandate of Sales Force Automation (SFA), whereas Retention was in the realm of CRM. I did that, because I am fixated with trying to disentangle these two terms.

If we drive down to the departmental level, it seems that Marketing and Sales should drive Acquisition, and after sales service should drive Retention. In my book I discuss the “long winded title of Acquisition and Retention loop” (page 27) – long winded, because I could not find any other description that was suitable.

So after I write this, I realize that I was wrong—sales is not the only group responsible for acquisition, marketing is in there too.

Definitely everything falls under the umbrella of CRM, but that term has become so all encompassing that it is tough to look below and see what it all means.

Perhaps, if companies are focusing too much on Retention at the expense of Acquisition, or vice versa, one department may be more powerful than the other, in other words they don’t have a unified CRM program that’s working well. If they did the normal departmental interplay would help them achieve the right balance.

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Retention or Acquisition? Both!

Posted in Sales by Keith Thompson on the November 15th, 2005

I subscibe to the “inside 1to1” newsletter from the the Peppers and Rogers Group. As everyone knows, Peppers and Rogers were the early proponents of the CRM philosophy, and have published some very successful books on this topic. An article in this morning’s edition was titled Customer Acquisition Makes a Comeback. The opening sentence is “After a solid 18 months of obsession with customer retention, the customer strategy pendulum may be swinging toward customer acquisition.”

Retention of the customer means the process of developing a loyal customer base, and making sure that they stay happy and provide more business. Acquisition means that the enterprise puts its efforts into finding new customers.

I was surprised that big business has actually been homing in on one of these strategies at the expense of the other. I thought that you had to do both. Fortunately as I read on, one of the analysts comments supported my feelings—“you need a balanced attack of both existing customer development and involvement in your brand coupled with smart strategies to acquire new customers.”

It struck me that for most businesses, Retention is more about CRM, and Acquisition about SFA. The marketing and sales departments will be involved in both initiatives – but the goals are distinctly different.

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