HomeBlog What B2B Marketing and Sales Can Learn From Walmart

What B2B Marketing and Sales Can Learn From Walmart

February 15, 2012 | By Jim Ninivaggi

While we certainly don’t advocate that B2B marketing and sales adopt the type of adversarial vendor relationships Walmart is legendary for, its success does provide some valuable lessons.

Famous (and notorious) as a model of ruthless operational efficiency, Walmart is known for mastering just-in-time (JIT) delivery of goods – holding virtually no inventory – to extract from suppliers only what’s needed to sell. While we certainly don’t advocate that B2B marketing and sales adopt the type of adversarial vendor relationships Walmart is legendary for, its success does provide some valuable lessons.

While you may never have thought of it this way, to a certain extent marketing is a supplier to sales. Like a manufacturer supplying a retailer with goods, marketing supplies sales with leads. Sales, like a retailer, needs to convert those leads into closed business as efficiently and effectively as possible. But, like a retailer that depends on the help of a supplier to create demand and move product (through advertising, promotion and point-of-purchase strategies), sales needs the help of marketing (through branding, campaigns, content and tools) to create/accelerate demand and close business. Too often, we find that sales has a tough time asking for this help.

Tell the Supplier What You Want and Need

Walmart’s strategy is simple: Sell goods to the customer at the lowest possible cost. Its suppliers understand that Walmart wants them to drive as much of the cost out of their products as possible. Walmart employees can’t even accept a cup of coffee from a supplier – because it adds to the cost of merchandise. We recommend that sales get what it needs from marketing through a formal, structured and collaborative process to establish clear objectives, expectations, measurements and mutual respect. Service-level agreements (SLAs) are a highly effective vehicle for establishing this process, and we’ve seen firsthand their effectiveness in the work we do with clients.

The Job’s Not Over When the Goods Are Delivered

Too often, marketing views its job as simply creating demand, and considers the job done when a lead has been successfully accepted and qualified by sales. Wrong! Just as Walmart suppliers provide advertising, promotional and point-of-purchase assistance to help the retailer engage and convert shoppers, marketing should look for ways to enable sales by developing content and tools that help buyers through their decision process, using data to help determine where to target those efforts.

Data Is a Two-Way Street

Walmart’s competitive advantage is its use of data in driving operational excellence. The company collects, aggregates, analyzes and shares data with suppliers to ensure that the right products are delivered in the right quantity to the right location at the right time. Possible hurricane in Florida? Walmart alerts Kellogg’s to increase its shipments of strawberry Pop-Tarts to the Sunshine State because the data shows people buying them when power outages are likely.

In the B2B realm, sales can help direct marketing efforts to where they will be most helpful by sharing real-time data from sales force automation (SFA) systems. For example, if the SFA data identifies a “break point” where there’s high deal attrition in the sales pipeline, marketing can provide content (e.g. client success stories) and programs (e.g. executive briefings) to improve results.

Unfortunately, the typical B2B sales organization is no Walmart when it comes to data. With often minimal SFA compliance, the data shared by sales is typically not close to the amount and quality that marketing needs to drive these key decisions. By demonstrating how sales will benefit by entering this data, providing value to sales in using their SFA tools (e.g. integrating playbooks, comp management, game design techniques) and having sales managers coach their reps, compliance and data quality can be increased.

Can We Get to JIT Delivery of Leads?

As previously noted, Walmart is famous for holding as little inventory as possible. Using technology, it demands JIT delivery of goods based on what’s selling and what’s not. Now, imagine if Walmart demanded that its supplier provide four to five times the goods they could actually sell? Not likely to happen, yet it does when sales demands that a 4X or 5X pipeline be managed by its reps. Our research shows that an increase in pipeline-to-quota ratio often leads to a decrease in overall sales productivity and an increase in wasted resources (both in undeveloped leads and sales efforts that go nowhere). Marketing and sales should take a lesson from Walmart. Rather than hold inventory, sales should send it back to marketing for nurturing and development until it’s ready to close.

While Walmart has a reputation for being a demanding company to do business with, there are also many stories of the company collaborating with partners for the greater good. Case in point, Procter & Gamble (P&G) came to Walmart to share its thoughts on how to make cosmetic products greener. P&G worked with a cross-functional team to design products and packaging that were more sustainable, ultimately leading to greater sales. A great lesson on the benefits of working together for any B2B marketing and sales organization!

Jim Ninivaggi

Jim Ninivaggi is Service Director, Sales Enablement Strategies, at SiriusDecisions. Jim’s focus is on helping to deliver data, knowledge and insight that our clients need to improve sales performance and drive ROI. Follow Jim on Twitter @jninivaggi.
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