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20 sales and marketing problems solved - Smartcompany Insights

07 March 2011

The financial crises has thrown the sales and marketing strategies of entrepreneurs into disarray. Customers have become more hesitant to buy. Sales teams are struggling to get deals over the line, and the marketing budget isn't looking as healthy as it used to.

We have asked a range of sales and marketing experts and entrepreneurs to help solve 20 problems confronting business owners.

Most of the advice won't cost you a cent to implement, and you will also be able to create more robust sales systems and processes that will last you long into the recovery.

Problem: Customers are crying out for discounts.

Solution: Don't drop your prices - find another way to get them over the line.

Marketing guru and SmartCompany blogger Colin Benjamin says there is a big problem with discounting, \"Once you drop your prices, it is nearly impossible to raise them again.\"

Luke Bayliss, co-founder of Sumo Salad, agrees. \"We are preferably not discounting because that has a negative impact on the business as a whole. Particularly during the global financial crisis, people may respond well to those in the short term, but they cause long-term damage.\"

Benjamin says companies must find other ways to persuade customers to buy, mainly through offering improved service. Offer customers better terms of trade (by giving them longer to pay), offer priority delivery or think about giving them a little gift with every purchase.

\"The key is to try and get more revenue out of each customer,\" Benjamin says.

Problem: Two of our sales people are doing well, but the other eight are struggling.

Solution: Get the stars to coach those falling behind.

Trent Leyshan, managing director of sales consultancy Boom Sales, admits the sales environment can be cut-throat and sales people can be very protective of their intellectual property - that is, their sales methods. But he says that good companies need to break down these barriers and coach top sales people to share ideas.

\"A lot of sales models can be very competitive, and sales people can operate in their own silos. To me that's counter-intuitive to a business that is genuine about doing the best by its customers.\"

He suggests getting all sales people together for a brainstorming session to create a sales process that everyone can do. Naturally, this should be led by your sales stars, who will coach other members of their group and start them climbing toward their level.

Problem: I don't know what my sales process should look like.

Solution: Develop strategies to win, keep and grow accounts.

Rob Hartnett, sales coach and founder of consultancy Selling Strategies, says that the sales cycle (from lead generation through to client management) generally stretches out when the economy slows as customers guard their cash, and it is during these times that a robust sales process becomes crucial.

He says a sales process really needs to have three phases - a sales process for creating an opportunity; a sales process for managing opportunities; and a sales process for retaining and growing accounts won.

\"A down economy is a good time to review your sales process to improve its effectiveness,\" Hartnett says.

Problem. We haven't really had to sell for five years.

Solution. Make every employee part of the selling process.

Trent Leyshan was recently approached by an engineering firm that had a big problem - no-one in the organisation actually knew how to sell. They could work on tenders, they could manage projects, but the business just hadn't needed to be sales focused in the past. Now they needed help.

Leyshan concentrated on getting the firm's top management to understand the importance of putting sales at the centre of the firm's strategy and to demonstrate that everyone in the firm had a role in selling, from the admin staff to the accountants to the project managers.

\"It's about getting everybody and the same page and getting everyone to understand how they engage customers.\"

Problem: Customers don't seem to \"get\" what we do.

Solution: Develop a clear sales message.

Sue Barrett, head of sales consulting group Barrett, says that businesses must give a clear, concise message of what exactly their business does before they can even think of making a sale.

\"My basic solution is that you need to have a clear marketing message of intent. What do you do? How do people understand what you do? You need to sell the 'right way' and to do that you need to ask what it is exactly that you do for people.\"

\"Being pro-active and talking to people is great, but if you're not clear about what you do then they're not going to understand.\"

Problem: Where do I start with sales and marketing planning?

Solution: Get your sales targets clear.

Barrett says that companies cannot afford to be complacent in a downturn and must figure out a plan to survive, and part of that strategy involves setting clear sales targets.

\"Look at the numbers to decide what you have to do. If you need X amount of revenue, then look at what your average sale is, and out of that ask how many sales you need to make each year, how many prospects do you need to talk to for sales, and ask how many people you need to contact,\" she says.

\"A lot of people rely on websites and such, which is nice but they in themselves do not make you a sale. They keep your brand out there, but you have to pro-actively put yourself out in the market.

\"You need to look at details. Know what markets you need to be targeting. Who do you need to be in front of, and how often do you need to do that?\"

Problem: I need leads.

Solution: Work your database.

Debra Templar of retail services firm The Templar Group says the downturn is a good opportunity to work your database and contact those on your database who have served you well.

\"Remind them that you exist. Fill them in on any new products or services you're offering. I recently had a marriage celebrant decide she was going to re-contact her former customers... Not only on the off-chance they may need her services again but because they most likely could have friends and associates who might need her services.\"

A bit of database pruning doesn't go astray, too.

\"Get rid of the dead wood and work hard on satisfying the needs of your top 20% of customers (most likely they're giving you 80% of your business),\" Templar says.

\"Too many times we run around chasing new business and we forget about the 'gold' sitting in our databases. We assume our top customers will always be loyal and we forget to reward them for having got us where we are. They've brought us to the party; the least we can do is dance with them.\"

Problem: I've got no money for sales staff incentives.

Solution: Find other ways to reward your top performers.

Structuring incentives for your sales people is not easy, particularly in difficult economic times when the bonus pool is looking decidedly shallow.

Colin Benjamin says that the obvious strategy is to move towards short-term sales commissions, but he says this can create a competitive and poisonous environment among your sales team and can lead businesses to focus too much on the short term.

His solution is to use non-financial rewards in the short term, such as flexible working arrangements or time off for a special occasion. Then, depending on whether sales targets have been made, sales staff should get financial bonuses at the end of the year.

Problem: My company can't afford to carry inventory.

Solution: Use the 80/20 rule.

Organisations that were selling out of inventory in the boom have found themselves with a problem - to free-up working capital, there has been a need to run down inventory levels. Of course, this creates another problem - selling stuff that you don't have is a good way to annoy customers.

Benjamin says it's time to employ what he calls the 80/20 rule. Concentrate on the 20% of your products that bring in 80% of your revenue and make sure that you always have these products in stock. You should be able to run down inventory levels across the rest of your range.

Problem: Where should I aim my marketing campaign?

Solution: Narrow your focus with micro marketing.

Brian Walker, principal and founder of retail consultancy The Retail Doctor, says the days of the mass marketing campaign is fast diminishing. For example, sending a catalogue or flyer to every home in your area just won't work - instead, you need to target your marketing to the people who you know are actually interested in your product.

He suggests any such campaign will need to be multi-disciplined; online, direct email marketing, and advertisements in appropriate media. A campaign based around a loyalty or rewards type program can be particularly effective, as you can be certain you are targeting those customers who want your goods.

\"It's about protecting the margin as best you can,\" Walker says. \"Think of ways of giving them a reason to come to you.\"

Problem: How do I make sure my marketing gets people buying?

Solution: Call your customers to action.

Luke Bayliss from Sumo Salad says that companies need to focus on marketing that will deliver them a solid return on investment.

Bayliss says, \"We're focused on return-on-investment type marketing, call-to-action type marketing messages that drive the revenue of the business.

\"Call-to-action is something that gives consumers a specific reason to buy. Not necessarily a discount, but points of differentiation like a special flavour for the month, or a new product. Simply from a marketing perspective, it's just about being pro-active and getting out there.\"

Problem: It's expensive to buy media space for marketing.

Solution: Negotiate with media buyers and grab a bargain.

During a downturn, many businesses are making decisions based on fear that the economy will continue to deteriorate. But Chad Polley, marketing manager for video games retailer GameTraders, says that businesses should do all they can to communicate with ad agencies to pick up good deals while the time is right.

\"With the decrease in advertising spend across the country, media buying costs are coming down and there are some great deals to be had,\" Polley says.

\"During tough times consumers are more conscious of value and tend to spend more time at home, and TV spend can become increasingly effective.

\"Cement relationships with your media partners and advertising agencies, work with them for mutual benefit. If their business doesn't survive, you will be forced to find new partners, which could take significant time to get them up to speed.\"

Problem: How will I know if my marketing campaign is getting a good result?

Solution: Measure, measure, measure.

Researching your customers may seem boring, but Debra Templar says it is the only way you'll start making progress in the downturn.

\"You've just run an ad and an additional 100 people have come through the door on day 1 of the ad. Your marketing has worked - irrespective as to whether or not they have bought your product/service. You could easily have 100 people through the door and sell to one of them,\" she says.

\"You don't have a marketing problem, you have a selling problem. Before you run the ad again, you'd better get up to speed with sales techniques, otherwise you're going to get the same results again and again. The marketing worked, you and/or staff didn't.

\"The flip side of this is when you have 10 people come through the door and you sell to eight of them. There's nothing wrong with your sales and service skills - but the marketing wasn't the most successful. Measure, measure, measure - so you know where to put your future marketing spend.\"

Problem: There are not enough customers for my store.

Solution: Learn how sell to the ones you get.

Retail expert Brian Walker hates it when downturn-hit clients tell him the reason they are struggling is a lack of customers.

\"There's no shortage of customers, you're just not selling to them.\"

He says that on average just 20% to 25% of people who walk into a store actually buy anything, and 60% of transactions have no add-on component. Improve these ratios, he says, and you'll quickly solve the problem of falling sales.

Walker says retailers should concentrate on pouring sales training into their staff to improve their product knowledge. Shop layout and ambience (music, lighting, décor) is important and stock management is crucial.

\"You can't sell what you don't have,\" Walker says.

He also suggests emphasizing those little extra things you do, such as a clothing shop that offers an alteration service.

Problem: My sales pitch just isn't working.

Solution: Understand the difference between a customer's need and their decision- making process.

Adrian McFedries, managing director of franchise consultancy firm DC Strategy, says that too many businesses spend too much trying to sell a product while ignoring how a customer thinks before they buy it.

\"Between 70% to 80% of businesses don't understand the difference between a customer's need and their decision-making process - that's the most important aspect of selling; full stop,\" he says.

\"How many times have you had a salesman ask you, 'What's important to you when you buy?' They just go on about functions and features and price, but don't really ask what is important.\"

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    Ann Margulis 6 years ago

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