In a softening market, organizations must firm up plans for driving more predictable return from both of these critical functions.
Editor’s Note: The following newsletter is a sampling of observations from our recent research brief series on sales and marketing in a down economy. SiriusDecisions Executive Advisory Services members have access to additional content on this topic through our research portal.
You hear a rumble in the distance, notice the clouds gathering on the horizon and check the forecast to decide whether or not to grab an umbrella as you head out. Unfortunately, there is no radar to look at to get a quick fix on tomorrow’s economic conditions and their impact on your business, just a dizzying array of data regarding gross domestic product, unemployment, manufacturing output and inflation.
If you’ve read a newspaper or listened to any news broadcast, you know that the U.S. economy is slowing and may be headed for a recession. This doesn’t mean, however, that your organization can’t prosper in a down economy. In this issue of SiriusPerspectives, we identify three key sales and three key marketing strategies that help both functions weather the storm together.
THE SALES THREE
To anticipate and prepare for a market slowdown, you’ll need a contingency plan that allows you to adjust to new economic conditions and minimize their impact on your operations, including:
- Territories. In the best of times, 100 percent territory occupancy is important; in a down economy, it is an absolute must. Your competitors will view open territories as a breeding ground where they can aggressively pursue your accounts and attack adjacent markets. Develop a sales management process to focus on complete account coverage and implement a performance improvement plan for your reps. With fewer jobs available voluntary turnover may decline, although a careful evaluation of existing sales personnel will help you identify potential candidates to cut, should the need arise.
- Sales readiness. Marketing collateral should focus on your solution’s cost benefits or risk avoidance. Develop enhanced value messages, ROI facts and expense reduction case studies to provide your sales organization with the tools and messages it needs to handle increased customer objections. Discounting is the wrong way to maintain customer attention in a slow market.
- Demand creation. While new name account opportunities will be more challenging, competitive displacements may be fertile ground for new business. Just like your organization, your competitors are going to be forced to cut expenses and perhaps resources, diminishing their ability to support their accounts. Disenfranchised or vulnerable accounts might be ripe for a targeted marketing playbook of incentives, collateral, messages and promotions. A combination of pricing actions and competitive spiffs will motivate your reps and put pressure on your competitors to defend their accounts.
THE MARKETING THREE
In the past, economic slowdowns were anchors around the necks of many marketing executives who had done little when times were good to prove the value of their function, leaving budget cuts and layoffs inevitable. The cycle can be broken, however, by focusing on the following:
- Customer attitudes/satisfaction. Customer surveys are generally done when times are good; after all, who has money to talk to customers when dollars are so tight, right? Wrong, and wrong for a number of reasons. First, by collecting insight on customer attitudes and behaviors, you can help to determine whether the slowdown so widely trumpeted in the mainstream news is affecting your corner of the world. Do customers plan to reduce spend, and if so, how much? Do they anticipate changes to the way they buy? Second, you can assess their attitudes about your offerings, and their current satisfaction levels. After a deal is closed, were they satisfied with the support your organization provided in the facilitation of their buying process? Do they see your products and/or services as need to haves, helping your resiliency? Are they satisfied, heightening the chance they will be more open to appropriate cross-sell and upsell offers? Who knows; you may just find you won’t likely be dragged down as much as the herd, and overcorrecting in terms of greatly reducing spend would result in an awful lot of opportunity lost.
- Demand creation/pipeline. Many b-to-b organizations have begun to track an overall demand funnel from cold to close incorporating both demand creation and sales pipeline metrics, a concept we originally described in the brief “Demand Creation: Five Metrics That Matter.” The measurement of demand creation and the sales pipeline begins the process of co-ownership of the funnel by both marketing and sales; clearly identifies the role that both play in the health of an organization’s new business pursuits; and systematizes the fact that quality activity at the funnel top will result in a healthier funnel bottom. More importantly, the data now pouring out of these funnels (e.g. inquiry rates, inquiry to marketing qualified lead and marketing qualified lead to sales qualified lead) can help business forecast slowdowns long before deals stall or turn into losses in the historically sales-dominated portion of the pipeline. These measurements have been created over the last few years to drive stronger alignment between sales and marketing; in difficult times, the alignment should be trumpeted to demonstrate the interdependence of the two functions.
- Sales playbooks. A sales playbook takes an often-overwhelming amount of marketing-created information and distills it into a series of “plays” that can be applied to help facilitate specific stages of buying processes for specific audiences within target markets. These playbooks help an individual rep build his or her knowledge base more quickly, allowing for more interactions of better quality. In a down economy, marketing must work with sales to ensure messaging meets changing requirements, as well as accounts for new audiences (e.g. finance, purchasing, procurement) that tend to get more aggressively involved in buying processes during these times.
THE SIRIUS DECISION
Just as winter eventually turns to spring, weak economies become strong again. In the interim, taking actionable steps to prepare for a slowdown can minimize its impact on your business. By linking the core activities of sales and marketing with one another – as well as metrics that are critical that are important to the business – senior management will see that severely cutting the resources of one function will cause major problems for the other.
|
 
|
