For those who live in the world of bringing disruptive technologies to market, it has long been apparent the B2B transaction sales force model is dead, has been dead for 6 or more years.
You know the stats: half of B2B reps do not make quota. Turnover is very high and if you talk to the B2B reps, they almost universally loathe their Sales VP and hate their jobs.
What keeps them coming to work is the increasingly elusive big payday: that lucky VMware guy who has just the right accounts and lands the million dollar payday – once in a career. The lucky startup guy or woman who get the 7 figure stock option pay out is on one’s mind.
Those stories are growing a lot of hair as they become older and much farther in the rear view mirror. More common is the B2B rep who dials for dollars, gets useless “leads” from marketing that never turn into a meeting, sits through endless QBRs (quarterly business reviews) and has his or her emails and meetings measured since these are the only indicators of productivity when revenue is so scarce.
Customers and prospects avoid sales reps by hiding their email using Hotmail and Gmail accounts, not downloading anything since the chirpy BDR (business development rep) will call before it hits the Inbox..
Cute dogs running around the office, logo-wear, free lunches seem so cool when the B2B rep joins. These disappear as weekly, then daily forecast calls, “what is your commit?” confrontations become the incessant, harsh reality. Yes, this B2B rep has a transaction Sales VP who has no idea about the new sales reality.
Or as I have witnessed, most transaction Sales VPs are virtually illiterate; having to move their lips when they read.
What does obsolete feel like? Sit back, think about it.
What did the last buggy whip manufacturer’s Sales VP say to his or her spouse when they came home? “Terrible day dear! Sales team cannot make those numbers. My reps are full of excuses that people are buying automobiles! CEO beating me up, but no matter how much I threaten their jobs, these useless wretches cannot sell! buggy whips.”
What did the last DEC minicomputer Sales VP say? “Damn!, I am having forecasting calls every day and the numbers are not there! I cannot predict my revenue! The CEO says everyone needs a DEC minicomputer, but these stupid customers think a personal computer will actually do the job!” “Dear, no matter how much I beat up the sales reps, they just cannot do the job any more!” “Daily forecasting calls, that’s the ticket!”
Obsolete. Feel it. Think about what it looks like. Remember, obsolete is never seen from one’s windshield. It can only be seen looking over one’s shoulder, long after it has happened and delivered its stunning damage to those in its way.
What are the indicators of obsolete? What does it smell like or what does it feel like early in the morning at that moment between sleep and fully awake when reality is at its starkest, when it is most difficult to lie to oneself?
Obsolete means that no matter how much you flog the sales force, no matter how much money you push through that Marketo-SPAM-producing “lead-gen” machine, little changes. You can no longer predict revenue. Even large numbers of active deals fail to deliver the result you need to “make the quarter.”
So you, the transaction Sales VP tell your reps to “beat up the customer, make them do our will in our timeframe.” (I know, you think I am exaggerating, but one of them actually said this to me and I wrote it down so I can do his story when he gets fired. Former Chef guy at a DevOps testing company in San Fran, former SE, but that’s no excuse).
The customer, that hapless person who does use your stuff, starts avoiding the B2B rep’s calls because they are tired of having to “make the quarter.” To show you how toxic this can be, I saw a transaction sales manager beat up a customer to take an iPhone shot of a purchasing screen at her company to prove an order was in process so he could “make the quarter.”
He booked an iPhone screenshot!
Ever hear a software company say “…we are your partner?” Total BS. “You, Ms. Customer, exist to make our quarter.”
Obsolete shows up when fewer reps, across the industry make quota every year. Obsolete is pretty much here when Forrester writes a report “Death of B2B Sales.” Forrester, Gartner and the rest are the ones who give senior management an expensive view of what lies 90 days ahead of conventional wisdom. So if Forrester says B2B sales rep careers are pretty much over, they have been in decline for a LONG time.
Obsolete has a common, unfortunate characteristic: those who are becoming obsolete do NOT adapt, they fight the natural forces of the market until they perish. And the more stark the obsolete state becomes, the harder they fight.
So what happens?
The Sales VP gets fired. Take a look at hundreds of these B2B startups out there: Chef, Puppet, Digital.ai, Perfecto, about every sales “platform company” and most DevOps and browser testing firms and increasingly AI startups. You will note, deep in your Google searching, they are on their 4th 5th or later Sales VP. The founders are almost always gone or they have big titles with no responsibility and zero direct reports.
This is the world of B2B sales today. This is what OBSOLETE looks and feels like when you are in the midst of it. These are the unmistakable signs that 5 years from now, we will all look back and say “…why didn’t we see it coming?”
As obsolete slowly overwhelms those who fight it, there is always an emerging trend that is healthy, fun, lively and showing promise of success.
Since we are talking about B2B sales models, let’s play with some of these emergents.
One is the “trusted advisor selling model” we at ContingencySales.com live by. We believe that 95% of any selling process is complete if we can be in front of exactly the right decision maker, with the solution, showing a disruptive benefit.
Once there, anyone can make the sale. And we believe we can do that in fewer than 4 sales interactions using trusted advisors. Actually we do it every week.
Another model we like a lot is the “whole selling organization.” Here, instead of having sales as a department, the entire company has targeted accounts assigned to groups of people, some in selling mode, some in marketing, some in development and together they craft a precise reachout to the specific prospect.
Thus, for one prospect having a developer take a lead may be the best idea. For another, it might be someone in event marketing. Sell to the prospect the way they want to be approached.
For example, one of our portfolio firms built an application for a Fortune 10 company, and showed them the completed app, having been built in 35 days delivering a value our research showed they desperately wanted. They had internally budgeted over $10 million and 18 months to do this with a Global Services firm that has 3 letters in its name.
Our team gave them access to the app while they discussed a “sale.” The value statement was “…we deliver your entire app, in production, before you can get a contract done.”
This one line made the rounds throughout their C-Suite since we later found out they loved the idea of getting benefit before they had to write a check.
So try this on, ye cold callers who mindlessly dial for dollars all day, everyone avoiding your call: “We are sending a letter to Bill (CTO Fortune 20 company) arranging a time when we can demonstrate the integration of his billing system with a set top box billing system that runs 100 million customer records, on hardware he can hold in his hand, in less than 30 seconds. We understand it takes 28 days across the entire data center today.”
“Would you be so kind as to pass on the letter and see if there is interest?”
Within 90 minutes, a Webex demo to the CTO took place.
These and other models are being used by us and some of our friends and we will report on them and where they can work best.
The key is imagination and recognizing one cannot improve an obsolete selling model.
Let it die.
We are trying other models. Maybe the sales organization of the future will have many models, each adapted to unique customers. This is quite different from forcing every customer into an obsolete sales model they despise.
We can try out new sales models because we never take venture capital, not one dollar, in any of our portfolio companies. If we did take venture money, we would be screwed having to deliver a fixed sum every quarter, we would be on our 5th VP of Sales and our sales team members would generate SPAM via cold calls.
We recognize “obsolete” and we live every day trying to find ways to take advantage of the death of obsolete models, not worrying about being overwhelmed by them.
And since we take no VC money, we can find the future, and it is not transaction B2B selling.