Cheap Date: Do Free Social Connections Create Hidden Costs?

Which choice provides the best answer for the statement,

An online social network requires each of the following, EXCEPT:

A. a computer or mobile device
B. an Internet connection
C. people you like, know, and trust

The correct answer, of course, is C. No need for familiarity, either. “You have one friend request. Click to confirm.” Done!—without even shedding your fuzzy bedroom slippers. But is your social network a trusted community of valued connections, or simply a collection of names?

Marketing technology has met social networking, and changed it. Whether it's for the better is another question. Once-private “black books” are open to the world. I can “connect” with people I don’t know. From the comfort of my office, I can solicit thousands who have never heard of me or my company to follow me on Twitter, to join my network on LinkedIn, or to become a friend on Facebook. Anyone can connect with anyone—or anything. No additional charge!

“Community” now grows at warp speed—but assumptions struggle to keep pace. Why? Because many people maintain that “social network” and “trusted connections” are intertwined ideas. True--before “click to connect.” But zero-cost Web 2.0 social connections mean there’s a significant likelihood that any two connected individuals have never communicated beyond a perfunctory default email invitation, and a single mouse click. Compare that process to laborious face-to-face meetings, and it’s easy to understand social media’s stunning popularity for building community. Scalable workflows and simple user interfaces have obviated the need to shake hands.

Has the concept faded that social connections are spawned when people mingle with like-minded people? As web-based communities erode boundaries between personal and professional domains, are we more open-minded to different beliefs and ideas—or just more dispassionate? I floated a related question on LinkedIn: “Would you sever a social network connection if you learned the individual belonged to a group, or held an opinion, that was diametrically opposed to a matter important to you?”

Some people drew an almost-crisp line. Mike Stankus, CEO of STM/360 said “if the person was part of a movement (or) group that was pushing hate or some other seriously negative agenda, I probably would sever the connection.” Sales expert Christian Maurer shared that he recently cut a tie. “I did not want readers of my profile (to) draw the conclusion that I could possibly be supporting an idea by being linked to this individual.” Others were ambivalent. A few wrote they value diverse opinions, and social media allows people of adamantly opposing viewpoints to connect. In a sense, we’ve come a long way. Although the same individuals might never socialize over a beer, they remain happily connected in the virtual Web 2.0 world.

In three years, social media technologies have undermined basic assumptions about connectedness. In January, 2007, blogger Guy Kawasaki wrote, (“10 ways to use LinkedIn”)

“By adding connections, you increase the likelihood that people will see your profile first when they’re searching for someone to hire or do business with. In addition to appearing at the top of search results (which is a major plus if you’re one of the 52,000 product managers on LinkedIn), people would much rather work with people who their friends know and trust.”

Feel the love! But not everyone looks at connectedness that way, as blogger Joe Bartling describes: (“LinkedIn: The Myth of Having "Too Many Connections")

“To me, having too many connections is like having too much MONEY. Bring me the connections, and bring me the money! People seem to think that a person who has ‘too many connections’ doesn't have a life. Though that may be true, it's not because he/she has too many connections.”

Want to understand “connection” and “connectedness” in the context of social media? It’s hard to reconcile those two statements. While both tout the benefit of numbers, one statement assumes "know and trust," while the second one doesn't make any mention of either. If you believe the concepts of social networks and meaningful connections are inextricable, then indiscriminately adding connections erodes the value of the network. If networks are valued for quantity of connections, then the assumption of trust between connections adds risk, because there is little that coheres individuals. These risks create costs, a reason that people are driven to B2B communities that are “’gated’ or have a threshold for membership,” as Vanessa DiMauro describes in her blog, “Moderating B2B Communities: Keeping the Fire Lit”.

The future of web-based social networks will be determined more by the requirements of people who use them, than by the technologies that enable them. If societies value true communities, then shared beliefs, trust, and common purpose must exist within those communities. Easier said than done! With 230 million and 50 million members respectively, Facebook and LinkedIn undoubtedly know that it’s harder to measure the intangibles that flow between connections—knowledge, innovation, inspiration, and energy—than it is to collect data about individuals.


Further reading:

Lynn Townsend White, Jr. versus: Technological Determinism

Just the Facts? Sales Discovery Requires More than Asking "Killer Questions"

Every day, salespeople receive gobs of well-intentioned advice, including:

“Shut up and listen!”
“Being interested is more important than being interesting.”
"Telling is not selling."
“The Right Sales Questions Will Get the Right Answers.”

But simply asking questions and listening won’t solve our most vexing sales challenges. If only it were that easy. Probing questions followed by patient listening as the magic keys to sales success. But here’s a plain fact that many people ignore: Conversations carry questions. And sales questions minus conversation equals interrogation. I know. When it comes to conversational rapport, some sales meetings go better than others.

Yet, hard-sell hype about the power of questions drives many people to website altars in search of A Better Way. Do you really believe in

“Killer sales questions?”

“Sales questions that close every deal?”


"The 12 best sales questions to ask?”

We count on the promise of such “hot ideas” and shortcuts to help us become more productive. No doubt, for many people, this is all very confusing. Should we ask open-ended questions? Closed-ended questions? “Facilitative” questions? Who cares! If salespeople can’t embed sales questions into meaningful, rapport-laden dialog, the best sales questions in the world take sales opportunities down a path to nowhere.

Salespeople—it’s time to talk! Questions need the medium of conversations in order to work. It’s what we do! But this time, let’s call it dialog! As our top-producing salesperson, Denise, said in an earlier CustomerThink article, To an Octopus, ‘50’ Means Nothing: Why Empathy Matters, “. . . I think about what I’m going to ask and say.” In that order. Denise doesn’t dismiss the importance of her contribution to the conversation.

From her desk in the depths of the call center cube farm, Denise has a key insight. With all the attention we heap on asking good questions, do we honestly believe prospects will spontaneously open up? Is “ask a Really Good Question, get an answer,” a simple, straight line? Or, is there more to it than that? How do we create what author Jim Collins described as an environment where the truth is heard?

Here are a few ideas:

Make your intentions and motivations clear from the outset. As Mahan Khalsa wrote in Let’s Get Real or Let’s Not Play,"you will communicate your intent whether you want to or not . . . Based on your intent, people will decide to trust you or not.”

Share your expertise throughout the discussion. No one likes a know-it-all, but as a prospect, would you rather share your answers with an expert or a greenhorn? As Jill Konrath, author of Selling to Big Companies, said, “the best sales questions have your expertise in them.”

Demonstrate that you are connecting the dots. Sharing your insights throughout the conversation not only makes it clear that you’re listening, but also helps to ensure understanding.

Be transparent, not opaque. It’s hard to ask for a prospect’s candor without being similarly forthcoming about your enthusiasm and concerns. Being open with both enables reciprocal dialog.

Above all, don’t be afraid to talk. Sales discovery works best in a conversation.

Going, Going, Gone! e-commerce Erases More Than Paper Money

Imagine a meeting of Major League Baseball team owners as they collaborate to improve their financial results. You're in the room. A scrawl of operating statistics covers several flip charts. Alternatives ranging from increasing ticket prices to cutting fan perks are discussed. But at the end of the 10-hour meeting, one option prevails: beginning next season, the pitcher’s mound in every stadium will be moved a modest six inches closer to home plate.

Great excitement follows. Owners can take the results to the bank, and players and fans won’t even notice! How? The executives figure that the shorter distance will make it possible to play a full game in just under three hours, down from the current average of three and a half. They reason that six fewer inches of throwing distance cuts the decision time for a hitter to swing, resulting in more strikeouts. More strikeouts mean less playing time, and less playing time means shorter operating hours for stadiums. (There were about 33,000 strikeouts in 2008.)

Eyes light up as numbers are eagerly keyed into pro-forma spreadsheets on flickering laptop screens. The thirty-minute per game reduction will save millions of dollars of operating expenses for every team. Lower labor and utility costs! Faster fixed charge coverage for expensive stadiums! The savings will drop right to the bottom line!

If you think the boundary-changing idea sounds preposterous, think again. This principle behind this imaginary gambit isn’t fantasy in e-commerce. The difference is that the boundaries are abstract and the money is real—to those receiving it. Want proof? This year, banks are projected to earn $38.5 billion in overdraft charges by shifting a long-assumed boundary called “I accept the charges.” How? According to a recent editorial in The Washington Post (Overdrawn and Uninformed, 9/22/09): “. . . from time to time, you may have found yourself inadvertently making a debit card purchase that exceeds your remaining funds. Alas, the way you may have found out about the overdraft was a notice from your bank, days later, informing you that you owe a $30 service fee. The bank just automatically floated you a small loan and charged you for it without giving you a chance to accept or reject the offer.”

Missed the boundary change? Don’t worry. Thirty-four billion dollars in 2009 overdraft fees suggests you’re not alone. The bank extracts money through a silent, virtual [i]ka-ching,[/i] with binary 1’s and 0’s flowing to complete the seamless transaction, absent the faces of Jackson and Hamilton. And that’s just the point. Customers don’t attempt to intervene because the experience fails to excite the same area of the brain that real money does—a phenomena that author Jonah Lehrer describes in his book, How We Decide. A small transaction-boundary shift yields a $38.5 billion reward—a sensational feat that now has the attention of Congress.

Elsewhere in e-commerce, changing abstract boundaries also keeps fiscal 1’s and 0’s moving from payer to vendor. Ever receive a charge on your credit-card statement for a "trial offer" you didn’t really want? It’s probably because you didn’t remember to “opt out” after you “opted in.” Was there a clear boundary for the transaction?

Opt in/opt out. It’s today’s tool of choice for e-commerce boundary changers. Remember Facebook's Beacon Debacle, in which a man purchased a diamond ring (for his wife?) from overstock.com, and 720 Facebook friends were informed about the transaction? As Christopher Caldwell wrote in The New York Times (“Intimate Shopping,” 12/23/07), “Facebook designed Beacon so that members would be able to “opt out” by clicking a pop-up window. But these windows were hard to see and disappeared very fast. If you weren’t quick on the draw, your purchases were broadcast to the world, or at least to your network . . . Privacy advocates urged that Beacon be made an “opt in” program, which members would have to explicitly consent to join . . . Facebook agreed to this approach. The Beacon fiasco gives a good outline of what future conflicts over the Internet will look like. Whether a system is opt-in or opt-out has enormous influence on how people use it.” No joke. And how much revenue can be generated, as well.

Of course, boundary changing has as much to do with our (presumably) private information sold to others as with the flow of money. Did you “accept” the data-collection cookie that resides on your hard drive? Better check the Terms of Use. “Increasingly, there are no limits technologically as to what a company can do in terms of collecting information . . . and then selling it as a commodity to other providers,” said Representative Edward Markey in August, 2008.

These examples prove that dollars can be taken and lost in the blurry zone between asking for specific approval to complete a transaction, and simply assuming assent for things that formerly required it. Whether it’s baseball or banking, with scalability, a little boundary shift goes a long, long, way.

Pfizer's Ethics Violations Hurt All of Us

"At Pfizer I was expected to increase profits at all costs, even when sales meant endangering lives. I couldn't do that," said John Kopchinski, the sales representative who blew the whistle on Pfizer’s illegal marketing practices of Bextra, a now-discontinued medication approved for arthritis and menstrual pain.

Mr. Kopchinski was fired from the company in 2003. In hindsight, he won’t miss his job. He’ll receive over $50 million from the US government for his efforts to prosecute the $2.3 billion fraud settlement from his former employer—the largest such settlement in US history.

Paying $2.3 billion for “fraudulent marketing" should cause every marketing professional and salesperson to break into a nervous sweat. Why? Because murky ethics aren't limited to Pfizer. They're amazingly common. They begin innocuously, then escalate. According to Mr. Kopchinski, what started as “aggressive promotion” of Bextra mutated into illegal practices. As he put it, “the ethical line kept moving.”

I’ve seen it over and over. Ethical risks are shrouded in code-speak: “we’re a ‘revenue-focused’ organization,” or “our company champions an ‘aggressive sales culture.’” Sound familiar? Anyone who doesn’t take heed from Mr. Kopchinski’s ethical-line observation faces the same risks. In Pfizer’s case, the problems didn’t begin with stereotypical predatory salespeople and percolate upward—they began at the top. Lies float, and so do corporate leaders who don’t set a good example--belly up. As sales effectiveness consultant Christian Maurer wrote this week on LinkedIn, “the fish starts rotting at the head.”

How can bright people working for well-regarded companies commit such ruthless dishonesty, when they wouldn’t think of robbing a cabbie at gunpoint—arguably a far less-heinous crime? By insulating the perpetrators from the victims. Here’s how (please see the embedded links):

Sales commissions: According to the NPR health blog, a “$50 bounty (was) paid to reps when they got doctors to add Bextra to the standard care for patients before and after surgery. These care protocols would direct patients to take Bextra, often at high doses, a few days before a knee operation, for instance, and then afterward to control pain.”

Telemarketing scripts directed to physicians: Salespeople were coached to tout greater efficacy and safety for Bextra compared to Vioxx, a competing painkiller from Merck. The US Food and Drug Administration never approved these claims.

Sales culture: OK. Let’s call it by its real name—intimidation. "If you don't aggressively sell your products . . . you're labeled a non-team player," Kopchinski said, adding that only by promoting Bextra for unapproved uses could he achieve management’s revenue goals.

You can see the evidence in clear black and white, and it’s all creepy. What was Pfizer’s management thinking? Caught with its pants down, Pfizer cut a check for $2.3 billion. Everybody—just shut up, leave the chicanery behind, and let’s move on! Problem resolved. But is it? At the same time that jolly Pfizer managers were gloating over PowerPoint slides showing escalating sales curves, people were suffering or dying from taking medications for unapproved uses. Bad ethics don’t get much worse than that, and even a $2.3 billion mea culpa won’t enable the company to sweep its dark tactics under the rug. A plan to sell cigarettes in elementary schools might have appeared more benign.

Which brings Pfizer’s indiscretions to the everyday salesperson. We’ve all experienced what happens when “baggage” is brought into a sales meeting. A salesperson is often considered guilty before he or she proclaims innocence. It’s understandable. Along with evaluating the performance and features of a product, prospects scrutinize a salesperson’s motivations and integrity. But as Pfizer’s deceit has shown us, prospects now need to look further, and to question whether the top management of a vendor's company has a moral compass. The answer to that question could reveal buyer risks that were previously unimagined.

For more on the topic of marketing ethics, please see:
Goofus and Gallant Make CRM Decisions, and
On My Honor as a Salesperson: Why Sales Ethics Matter

Perfect Pitch: A Tribute to Billy Mays, 1958-2009

Think you can sell ice to Eskimos? What about making a sales pitch in front of strangers for toilet bowl cleaner, picture hooks, laundry detergent, or putty. Go ahead. Step right up. See if you’re a better salesperson than Billy Mays, who died this week at age 50.

Billy’s commercials for Mighty Putty, OxiClean Detergent, and Kaboom are as close as a sales process gets to haiku. He builds rapport and trust, identifies a problem, pitches a solution, and motivates action—all within a two-minute commercial. Straight up, straightforward—and straight for the jugular. Whether he’s talking about toilets or dirty laundry, with his staccato delivery, Billy doesn’t tiptoe around anything.

Selling solutions that aren't glamorous, for problems that aren't pretty is much, much harder than it looks. And while it’s tempting to analyze Billy’s effectiveness by looking at the components of his sales pitches, his commercials are best appreciated without being encumbered by details. Billy connects with emotions, not with intellect. Who wouldn’t buy bonding putty that sets instantly, with the strength to pull a tractor trailer? I saw it in the commercial! And Billy just tripled the offer to six sticks!

What separates Billy Mays from other great salespeople isn’t his mastery of sales techniques. It’s not his effective deployment of people, processes, and technology. It’s his ability to delight the buyer. On that measure, he has few equals.

Whether we’re marketing gardening tools or ERP software, Billy Mays offers sales lessons for all us. In the meantime, a haiku tribute to Billy Mays, who could sell ice to Eskimos:

Top sales producer.
An opening. Hard sell. Close.
Buyer spends money.

Is "Call on the CXO" a Winning Strategy for Salespeople?

Here are some tired and no longer true sales tenets:

"Focus your efforts on reaching C-level executives."
"Get in front of a decision maker."
"Get around the gatekeeper!"
"It's a numbers game. The more calls you make, the better your chances are for a sale."

Why are these passé? Because the statements rely on these increasingly tenuous assumptions:

• C-Level executives are influential
  
• Job titles reliably predict whether an individual will be valuable in the sales process
  
• An organization transfers value through formal hierarchies
  
• Within an organization, decision rights are consistent, enforceable, and understood
  
• Sales is the most important connection point between vendor and prospect
  

Besides, selling isn't a numbers game. It's an intelligence game. But if these sales-ism's aren't true, then how do top sales producers develop, use, and manage selling networks?

Meet "Mr. Barcode"

I stumbled into part of the answer to this question in the early '90's, when I sold barcode technology. My prospect, a Fortune 100 manufacturer, purchased on a departmental level, but I wanted an enterprise-wide sale. I didn't know where to begin my campaign. Operations? Information Technology? Materials Management? Finance? As I placed calls into various departments, my inquiries were rewarded with a consistent answer: "When we have questions about barcoding, we go to Jim. We call him 'Mr. Barcode.'" I didn't know Jim, but encouraged by the moniker his colleagues assigned, I called him.

Jim was an unassuming man who worked in a windowless office in the middle of a cramped cube farm on the fifth floor of the Information Technology building. He had no decision-making authority, and his position was so low it didn't merit a spot on a published org chart. But today, a Social Network analyst would call Jim an Information Broker, a role of crucial importance for salespeople. I quickly learned why: no department made a barcode-related decision before he was consulted. I also learned that Jim already had many connections to my company's engineering team, and that by encouraging more connections, I improved the probability of achieving my goal. With Jim's involvement, along with some luck, our team won an enterprise-wide SAP project the following year.

What makes this story remarkable isn't that low-ranking Jim played such an important role. It's that most enterprises worldwide have many Jim's—and sales executives pay little or no attention to reaching them. Why? Because finding Jim's isn't easy. Their titles don't convey their importance. Their identities aren't readily mined from data warehouses. They don't hang out together in the same bars. Most significant, these key influencers are not self-anointed—they achieve their status through peer recognition. For a salesperson selling into a large enterprise, that fact alone makes identifying a Jim a task of near-monumental proportion.

Finding the First Mouth

But once identified, the rewards can be great. A paper by Raghuram Iyengar, Christophe Van den Bulte, and Thomas W. Valente Opinion Leadership and Social Contagion in New Product Diffusion, and discussed in an article The Buzz Starts Here: Finding the First Mouth for Word-of-Mouth Marketing explains how Social Network Analysis can be applied to this challenge.

The researchers conducted their work for a pharmaceutical company and found their Jim, referred to as Physician No. 184, on a Social Network Map. "Researchers had tracked how prescriptions of a new drug spread from one physician to another, depending on who talked to whom and referred patients to whom. Mapped out on the screen, the story became clear: The medical community was actually divided into two sub-networks split apparently by ethnicity, with one sub-network dominated by physicians with mostly Asian names and the other with mostly European names. Connecting the two, like a spider suspended on a thread between two webs, was the dot for Physician No. 184— a doctor the company's marketing department and salespeople barely knew (my emphasis).

The article shared further insight: "Not only did the study indicate that word-of-mouth had been affecting physicians' prescription behavior . . . but it also showed that converting the right individual could have a dramatic impact. And for executives in the conference room, it revealed something else: They had been overlooking some of the networks' most important social hubs. 'That was the biggest a-ha! for the company,' said Van den Bulte. Physician 184 'was not the most important in the number of connections he was getting, but he was vitally important in linking the networks.'"

And there's more. Whereas traditional market research asks people "Are you an opinion leader?," network research asks "Whom do you turn to for advice about ...?" According to the article, "the different approaches can produce widely different results...asking people how important they are is not the best measure of how important they really are. Just because people think they're important doesn't mean it's true. And some people are actually more important than marketers believe, or even they themselves believe."

Great opportunity awaits salespeople who develop relationships with Jim's and Physician 184's. But the first challenge is in knowing who you're looking for. So put titles and organization charts aside. If your sales team finds that concentrating effort on getting C-level appointments doesn't bear fruit, and that it's frustrating to "get around gatekeepers," maybe it's time to ask some questions beyond "how can we better reach the CXO?" Those questions could start with "what do the selling networks of top sales producers look like?

Like the study that discovered Physician 184, your best path to a sale might be through people your competitors don't even recognize.

Race and Gender Impact Employee Customer Service Bonuses

Are customer satisfaction surveys a fair and unbiased tool for for assigning employee bonuses?

No, according to a study published in the Academy of Management Journal, An Examination of Whether and How Racial and Gender Biases Influence Customer Satisfaction. According to the lead author, David Hekman, assistant professor of management at the University of Wisconsin, surveys “are highly reliable—but they are reliably wrong.” The authors believe that customer satisfaction surveys are biased because they are "anonymous judgements by untrained raters that usually lack an evaluation standard."

Hekman conducted several experiments to measure customer satisfaction. In one experiment, subjects watched videotaped interactions between a bookshop sales clerk and customers, and were asked to imagine they were the customer and to rate the bookshop’s service performance. Three actors played the part of the sales clerk—a white male, a black male, and a white female. All used identical settings and scripts.

The subjects shown the white male clerk rated the bookshop’s service 19% higher than subjects who viewed the other two actors.

If we use customer satisfaction measures to assign bonuses, can we assume we’re not compounding race and gender bias? If this assumption isn't correct, how can we make survey-influenced compensation systems fair? Could other attributes not measured in Hekman's study—for example, weight, age, and appearance—create similar results?

Tell the Truth--Is an Educated Consumer Really Your Best Customer?

“An educated consumer is our best customer.”

That slogan stood out when Sy Syms, CEO of Syms Corporation, said it in television ads in the 1980’s. Customer empowerment wasn’t a popular notion back then.

Fast forward to social media-enabled 2009. A new book, Get Content. Get Customers. , by Joe Pulizzi and Newt Barrett, challenges the Syms ideal. According to the book, “the more informed a consumer or buyer is, the more difficult it is to sell them.” Could both statements be correct? While they don’t directly contradict, they do point in different directions. In sales, there’s no such thing as an irrefutable truth, and in my experience, there’s truth in each one.

Not everyone agrees. In metro Washington DC, where I live, major corporations employ high-dollar lobbyists to fight the risks educated consumers pose, as anyone who tracks policies of the Federal Trade Commission or Food and Drug Administration can attest.

When is an educated consumer not the best customer? When she wants to know facts about the soil that grew the carrots she ate in last night’s salad. Or when she wants to learn about the living environment of the chickens or cattle that are now in the grocery meat case. Better for the producers that she sticks to knowing generic fat, carbohydrate, and protein content, along with “sell by” date. For other foods, the lobbyists insist she also doesn’t need to see the word “imitation” on some products, that she doesn’t need to know anything about the farms her food comes from, or what pesticides were used for their production. (For a more detailed discussion about why food manufacturers benefit from disconnected supply chain information, see author Michael Pollan's blog.)

Beyond food, The Wall Street Journal reported three related articles just this week:
FDA Says Video for Pain Drug is Misleading
SAT Coaching Found to Boost Scores—Barely
Laws Take On Financial Scams Against Seniors
What value do uneducated consumers bring to the companies profiled in these articles? Bernie Madoff won’t be reading this blog, but it’s not hard to guess how he would weigh in on this question.

Closer to where my clients live in the B2B selling world, I floated the statement from Pulizzi's book to a few sales groups on LinkedIn and received some excellent thoughts. The consensus was that it’s preferable to sell to informed prospects. That’s good, because—like it or not—prospects are better informed than ever. But a few of the responses I received were circumspect. Informed prospects aren’t necessarily any more open minded or are better decision makers than uninformed prospects. One salesperson commented about the difficulties that occur when a prospect is well informed on price, but has a poor grasp of the complexities of the product he or she is buying.

So when it comes to prospect knowledge, information is a two-edge sword. I’ve left some sales meetings in frustration, convinced my uninformed client wouldn’t recognize a good solution if it flew in and hit him in the head. In other situations, my client did homework and told me (correctly) that he could procure reliable refurbished or off-brand equipment for one-third the cost of my proposal—information that a sane commission-driven salesperson wouldn’t typically volunteer.

But today, with social media, the information genie is already out of the bottle. It’s more fruitful to debate what to do about managing prospect information than it is to debate whether informed-slash-educated prospects are better to deal with than those who aren’t.

Here are some questions to ask:

How well-informed is your average prospect? When you begin your formal sales process, what do they already know? What don't they know that they definitely need to know?

Where do your prospects congregate online (and offline) to get information?

For information outside of your company’s direct control, what risks and opportunities are present? What misinformation exists, and what is the impact on your sales strategy? Do you have a plan to counter significant misinformation?

What information do your prospects seek? What motivates them to seek the information, and how do they value it? Which risks are they mitigating and which opportunities do they want to capitalize on?

What information is available to them? Who contributes to that content? Who “owns” the content?

How will your prospects use the information they obtain? What portends a next step or action? What will break the buying process, and do you have ways to mitigate the risks?
Back to Syms. Whether an educated consumer really is the best customer depends on what you sell and how you sell it. Above all, be agile. If your sales process can’t adapt quickly to changes in information power, you will be debating about whether it’s better to sell to educated customers. But with social media, events move quickly. By then, it might be too late.

Will a "Slow Sales" Movement Save Us from Ourselves?

“Sell more, with fewer resources, faster. Oh, while you’re at it, bring me the broomstick of the Wicked Witch of the West.”

How’s that for a quartet? If you haven’t seen these challenges in a PowerPoint slide at your latest management meeting, you probably will. Most of us are already experienced delivering at least three of them.

We responded even before the banking meltdown. We absorbed higher sales quotas, targeted prospects better, made our lead generation more efficient, and shortened sales cycles. What’s unclear is whether we’re rocking uncomfortably from the ripples we’ve created. Time and again, we learn that our sales efforts have a negative impact on customer relationships. Our prospective customers often don’t trust salespeople, don’t like them, and don’t want to communicate with them. Are we pushing too hard? Should we cool our jets? Maybe the time has come for a Slow Sales movement.

Decades of Fast Sales dictums have yielded tactics that clash with long-term strategic goals:

“Close the Sale” versus “Build a Relationship”

“Generate a Quick Win” versus “Improve infrastructure to gain long-term improvements in customer loyalty”

“Win the monthly individual sales incentive” (and hoard tacit knowledge) versus “share knowledge so the entire sales organization can benefit”

“Make the quarterly revenue goal” versus “maximize the total value of the customer”

The Slow ideal has found a growing audience willing to question whether our obsession with collapsing timeframes serves our longer-term interests. The Slow Food Movement began as a counter-force to government and commercial entities that promoted convenience food and economies of scale without regard for sound nutritional and environmental practices. Educators have recognized a parallel danger. Peggy Orenstein wrote in The New York Times (Kindergarten Cram, May 3, 2009) “maybe the current economic retrenchment will trigger a new perspective on early education . . . Call it Slow Schools. After all, part of what got us into this mess was valuing achievement, speed and results over ethics, thoughtfulness and responsibility.” In education, it takes a brave person to question outcomes that are sacrosanct to many. But Ms. Orenstein reframed the question: it’s not about how can a child’s development be sped up, it’s “why are we so hellbent on doing so?”

Similarly, in sales, we must change the overarching questions we’re asking. The problem is, “how do we sell more, better, faster?” sounds better at the Achiever’s Club golf outing than another question I recently heard, “what steps do we need to take with each prospect and when should we take them based on the natural progression of our prospect’s purchase process?” That long-winded question sounds way too kind, and many sales executives would feel silly asking it. But by asking and answering that question we’re possibly more likely to achieve strategic sales success than by relentlessly pursuing tactics to satisfy the first one. Fast Sales rarely comes without high pressure and customer pain—two conditions that damage, rather than improve, financial results.

The promoters of the Slow Food movement exposed exploitation after recognizing a long-simmering win-lose relationship between top producers and end consumers. Large food manufacturers such as Monsanto, ConAgra, and Archer Daniels Midland could meet their financial objectives while at the consumer end of the value chain, people became overweight and undernourished. But Slow Food and Slow Sales are an imperfect comparison. The Slow Food movement encompasses ideals I haven’t seen on the white board for any sales planning meeting I’ve attended: equitable distribution of products and resources, and responsible stewardship of the planet.

Not that we’re unconcerned and mercenary, but in sales, one simple financial reality explains our preoccupation with speed: Net Present Value. Assuming the cost of capital is constant, the present value of a dollar in revenue today is worth more than in any future period. That cold fact drives strategic decisions. Sometimes customers benefit—sometimes they don’t. So through the Net Present Value lens, the juxtaposition of “slow” and “sales” might mean a situation to avoid rather than an inspirational movement.

But the same way fast food brings us Type II diabetes, and high-achieving preschoolers bring us win-at-any-cost adults, tactics to secure short-term revenue bring unwanted side effects that could take more than one generation to fix. Some progressive companies understand this, and not surprisingly, have embedded Slow Sales ideals into their brand. For example, “At Oboz we build shoes for outdoor use—shoes with meaningful innovation, solid performance and recognizable quality. We are also stewards of our rich natural heritage and believe that a business should contribute to the greater common good.”

If that lofty goal conjures up images of American consumers (who want affordable quality footwear, available in local retail outlets) holding hands in the woods with citizens of producing countries (who want jobs, unpolluted air, and clean lakes), it’s probably a mirage. Would Oboz voluntarily curtail sales growth to avoid sourcing materials from non-compliant vendors (a common dilemma in eco-manufacturing)? There are no easy answers, and tradeoffs must be made. But kudos to Oboz! At least I sense this issue has a spot on the white board in the company board room.


Like other Slow movements, Slow Sales requires taking some unpopular stances, and asking uncomfortable questions that put tried-and-true in the cross hairs of change. For some companies, that means looking at selling in a fundamentally different way by regarding a purchase transaction as a point on a timeline, rather than the end-game of a sales process.

Slow Sales won’t work for every company. It requires a long-term planning horizon, and companies that don’t have the resources to go the distance will trade one set of risks for another. But as with food and education, Slow might provide the best way to deliver value that can sustain both producer and consumer now, and in the future.

Hype of Hope: For Salespeople Does Social Media Live up to its Promise?

Social media has permeated our personal lives so thoroughly that we hardly notice when a new technology tool chips away a little more of our privacy. But in sales and marketing, we embrace social media as transformational. We're primed for game changers, and we don't need to look far for good old fashioned hype in these articles about how social media will transform sales:

For Sales Guys, Social Media is the New Cocktail Party
Five Ways to Increase Sales Through Social Media
How to Tap into the Social Media Phenomenon for Greater Sales and Profits
Social Selling—Building a Web2.0 Sales Force

. . . But is social media living up to its promise?


Double-edged sword

It depends. One statement by Kevin Waldvogel, Account Executive at Image Systems sums up the ambivalence of eight senior salespeople I interviewed for this article: "Social media is great to help people and get your name out there, but not the greatest place to make instant business. It reminds us to listen to people who are in need of help and think about helping them because you never know when you might be in that situation. It's kind of a double-edged sword."

One edge symbolizes that social media provides valuable improvements to sales processes, and the other that social media won't help if it's not intelligently embedded with more mature, proven sales techniques.

From Waldvogel's comment, one senses that if the plugs were suddenly pulled on LinkedIn, Twitter, and Facebook, life would go on—at least for this group. Social media touches their jobs, but outside of collaborative CRM, I couldn't find one case of a corporate mandate to use it.

Clearly if there were a mandate, it would have to consider the boundary of social media, a question Jeff Baker, Major Account Manager for Hewlet-Packard asked. "It's important to expand the list, to expand the footprint" of social media. According to Baker, it's everything from the directories in today's cell phones, which can be shared, to electronic community directories. Joe Panella, Sales Manager at Alpha Systems, corroborated Baker's idea. He has scoped the recipient line of more than one neighborhood community email to find domain names of companies he targets for his company's suite of data collection products and services. When he finds one, he sometimes contacts the individual. But from there, his sales processes are little changed from the early '90's when he joined his company.

Mike Chiappetta, Unified Computing Systems Specialist at Cisco, voiced a similar view. "Selling hasn't changed in fifty years. LinkedIn makes for great icebreaker discussion, but you don't know your prospect's agenda or business problems, so you gather nothing that will help you in a B2B sales process. There are no shortcuts for doing real homework."

Real homework requires learning strategic and operational pain points that ignite sales processes—information which social networking sites don't offer. And while the sites offer community, there's no insight about the activities between community members. According to Chiappetta, "if I spend time on my client's corporate website or Yahoo Finance, I'll get more information to help me build trust than I ever can on LinkedIn."

Social media's greatest impact results from how it enables internal sales collaboration.

These seemingly prosaic uses of social media are emblematic of the resourcefulness of people who sell for a living. They don't necessarily rely on sophisticated social networking software to capture, share, and use information about the organizations and people who are potentially valuable to them. They exploit little ways to improve on what they already do. I asked about the most visible social-media created change in their jobs. The prevailing answer? Email—not voice—now transmits an overwhelming majority of prospect sales communication. According to Panella, "I rarely get a phone message, but I touch 200 emails a day."

Still, I probed for a big social media success story. Panella told me of a large order he sold when he serendipitously discovered a friend's posting on Facebook. Baker described how he facilitated a sale for HP hardware in Eastern Europe by connecting a graduate school colleague to an Outlook contact who specializes in IT financing in that region. But despite these positive outcomes, neither Panella nor Baker is convinced that the same tools could dependably enable them to repeat those successes in the future.

Internal collaboration

For the salespeople I interviewed, social media's greatest impact results from how it enables internal sales collaboration. Cathy Cromley, Sales Director at market research firm IDC Government Insights, uses Yammer, which her company implemented to enable employees to share knowledge internally. In an organization with over 1,000 analysts, Cathy would find it overwhelming to identify expertise on high-level topics such as cloud computing or green that she researches for her prospects and clients. But with Yammer, she can find referenceable projects, connections to subject matter experts, and blogs internal to IDC.

Eric Freeburg, Senior High Touch Account Manager with Motorola Enterprise Mobility Business leads teams of up to 70 people on sales engagements for large accounts such as Kellogg, Whirlpool, GM, Ford, Chrysler, and La-Z-Boy. For Freeburg, internal collaboration is mission critical. If he spends time on social networks, it's managing his team through Motorola's CRM software, Salesforce.com. "Who has time for LinkedIn?" he asks.

External sales processes

When it comes to client contact, the veteran salespeople I spoke with use social networking tools conservatively, and in different ways. Baker of HP, manages one customer, AOL. "I know everyone I need to connect with at AOL. I don't do prospecting the way others do."

Trudy McCrea, CEO of IT Services firm Achieve-IT, LLC in Northern Virginia, avidly uses social media tools, but not to close business. Through Outlook, she maintains a list of target accounts, and uses LinkedIn for an advanced search to uncover who isn't in her database. She searches for specific information about the kind of people who work for a company, their education, previous company affiliation, and other background to develop a second tier of contacts. From there she might make a cold call by phone or send an inMail. She also uses LinkedIn's Groups function extensively. McCrea understands the role luck plays in developing new business, saying "I make many unplanned discoveries."

Unfortunately, social media websites have driven many influencers away.

Motorola's Freeburg works with between 50 and 300 active customer contacts at a time, but uses one resource—Salesforce.com—for the daily information he requires. He uses LinkedIn mainly to post his professional credentials so he can "present myself without bragging." IDC's Cromley thinks of online social networks as a dynamic Outlook application that doesn't require time or resources to maintain. She uses LinkedIn and other tools "mostly to keep up with where people are."

Protocol and impediments

This conservative use of social media might result from the fact that adoption of social media tools faces large hurdles—an often-obscured reality. According to Panella, "some employers don't allow their employees to use (social media) for company purposes. They place restrictions around it."

Such impediments aren't fully recognized. In a March 31, 2009 webinar "Hear it Now! Social Selling: Live Q&A on Selling with Web 2.0," Christopher Carfi of Cerado, Inc. said that it's important to engage with an influencer in their place first, and that if they have a public persona to use the mechanisms provided. Unfortunately, social media websites have driven many influencers away. McCrea, who regards client privacy of paramount importance, works with a high-level contact at Google who had a public persona, but changed because the visibility brought unwanted solicitations. According to McCrea, "LinkedIn doesn't shield customers. (My contact) got unwanted email and now uses Facebook. Now, people keep less data on LinkedIn to keep from being found."

Several salespeople shared that simple business etiquette guided their decisions about how to adopt social media. Cromley believes that using social networks as a prospecting tool is "not appropriate," adding "I'm offended by someone trying to tap my network simply to hawk their wares." While she uses LinkedIn to look up information about prospects, she cautions that salespeople "should be careful not to look like you've stalked the person."

And then there's The Law. A senior business development professional who sells technology solutions to the legal industry said that attorneys must address confidentiality, security, and privacy issues of Electronically Stored Information (ESI), and the public nature of the Internet adds to the complexity of legal issues. Many sources of ESI are discoverable in legal matters —something to think about before you set up your next social media campaign. My contact cited the case in which Whole Foods CEO John Mackey posted blogs for over eight years on Yahoo online stock forums by using a pseudonym. The SEC opened an informal inquiry to see if any insider information was released. Although the SEC ultimately concluded that Mackey hadn't broken any laws and that no action needed to be taken, ethical issues linger.

Social products and services

If better social media mousetraps exist, salespeople will buy them, and Twitter has made the shopping list of at least two.

If social media hasn't forced major process changes among the group I interviewed, it has dramatically changed the products they sell. Motorola, long a dominant player in mobile technology and retailing "has always been a strong supporter of social networking and is developing solutions for its clients," according to Freeburg. IDC has conducted numerous studies of government's use of social media and has released a case study about how the DC Government used YouTube for procurement, entitled Social Networking and Takin' Care of Business Every Way. In the legal industry, FTI Consulting broke ground in legal discovery with Attenex, a software application that provides visualization of social networks by tracking email traffic and document trails. In a global economy, this resource provides crucial support to corporations that might need to document connections for a seamy side of social networks—bribery activity.

If better social media mousetraps exist, salespeople will buy them, and Twitter has made the shopping list of at least two. Ironically, the staid legal industry occupies the vanguard of industry adopters. That's because "congress is adopting Twitter, so attorneys are as well," according to my legal industry contact. Cromley also considers Twitter a potentially valuable tool. The analysts at IDC use it extensively in the financial services vertical, and the company will expand its use to all six verticals in which it competes.

The road ahead

If the individual insights of these salespeople prove anything, it's that social media's promise depends on the ingenuity of the people using it. But there's another takeaway. Even in the face of market upheaval, and a great shift in information power from vendor to consumer, legacy selling processes are surprisingly durable. We're a long way from the seismic changes in selling others have predicted.

So where are we on the Social Media Maturity Curve? No one can say with certainty. Some have suggested that we're at a social-media saturation point. In her recent column, Let Them Eat Tweets—Why Twitter is a Trap (The Medium, New York Times, April 19, 2009), Virginia Heffernan wrote "Twitter may now be like a jam packed, polluted city where the ambient awareness we all have of one another's bodies might seem picturesque to sociologists (who coined "ambient awareness") to describe this sense of physical proximity, but (it) has become stifling to those in the middle of it."

If that's the case, in an uncertain economy, should companies take a conservative approach and delay implementing new selling strategies by waiting for the Next Great Thing after social media? No. When deployed intelligently, social media can provide remarkably valuable outcomes. Here are a few points to remember:

• Social media should transform processes, but not etiquette.
  Technology-enabled sales tactics will backfire unless acceptable business protocol is considered in the customer experience.
  
• Social media enables business strategy. It's a set of tools, not an endpoint.
  
  
  
• In the short-term, deploy social media tools selectively. Identify the most persistent selling problems you or your sales team faces, and embed social-media tools where appropriate. Unless there's a compelling reason, don't rip and replace.
  

Thought Leaders: PLEASE tell me something I DON'T know!

This year CMG Partners, an East-coast based marketing strategy firm hosted a panel discussion entitled Why Good Products Fail & How to Improve the Go-to-Market Process. The face-to-face event was complimentary to the local business community in Northern Virginia, and included experts from four enterprises: startup beverage company Honest Tea, National Geographic Channel, WeatherBug, and Intelevision.

Five minutes into CMG’s introductory PowerPoint, a man in the audience named John interrupted the presenter and opined “You’re the experts in marketing strategy, and yet, I don’t hear anything new. You haven’t provided anything we don’t already know!” He continued by reciting the unremarkable bullet points projected on the large screen in the front of the room, and emphasizing that he wanted to hear thought provoking insight worthy of his time. The slack-jawed audience at the McLean Hilton fell so totally silent you could hear a Blackberry hitting the plush carpeted floor.

Faced with this unexpected detractor, the presenter replied with such aplomb that his response belongs in the history books along with Lloyd Bentsen’s legendary debate response to Dan Quayle : “Well John, you get what you pay for!” The widespread laughter that followed was evidence that the tension of the moment had been broken.

The exchange somehow ended amicably, although I don’t think John will receive an e-invitation to CMG’s next event. The panel tried hard to live up to John’s expectations, thanks largely to Mark McNeely, CEO of Intelevision (more about that in a moment). During the post-panel networking, I introduced myself to John and thanked him for voicing an opinion that was probably unspoken by many, including me. “I might not have said it the same way, but I appreciate that you spoke your mind. There have been many times that I’ve wanted to say what you said, but didn’t.”

John might have been similarly moved during the recorded one-hour webinar on social media and selling I listened to on Monday. The topic is of particular interest as I’m completing a series of interviews with salespeople for an article I’m releasing next week. Like CMG’s event, there was a panel of thought leaders with cross-functional expertise—a great blend that should have created pungent discourse. And there were some good ideas that I jotted on my notepad and marked with an asterisk. But a few opinions were so over-worn that I stopped the recording and pushed back the timer a few seconds to make sure I heard them correctly: “We have to be in touch with our customers and understand what’s OK for them and what they expect from us.” And “It’s becoming more critical to know your customer.” Really? I acknowledge these comments are removed from the context of the discussion, but they were as attention-grabbing in the webinar as they are here.

Which leads to a question: are thought leaders fostering a sort of institutional stupidity by being too timid to espouse bold ideas? Or are thought leaders simply reacting to a perception that businesspeople need to be spoon-fed unremarkable ideas (not too big, not too small, not too hot, not too cold) so they can be nudged into considering larger ideas? On the other hand, could executives and managers simply be too intimidated by the multitude forces that are upending their business plans and strategic objectives to consider big ideas?

Mark McNeely might have answered the question when he synthesized the reason for the problems American businesses face: “there’s no oxygen in the room. Companies are run by management that is stagnant, bureaucratic, and self-satisfied.” He predicted that will change—because, if you subscribe to the idea of a Darwinian process for business, it has to.

Resolving our global economic situation demands the creation of provocative ideas. Controversial ideas. Ideas that are unpopular or disagreeable. We don’t need any more Mom and Apple Pie. In marketing and sales, nothing great will happen when well-known truisms are dusted off and passed on as contemporary expertise.

To those who regularly offer contrarian views, keep doing what you’re doing. The world needs your fresh perspectives now more than ever.

Ready to Sell? Quick--Name Your Prospect's Issue!

Author Michael Korda said “great leaders are almost always great simplifiers who cut through argument, debate, and doubt to offer a solution everyone can understand and remember . . . straightforward but potent messages.”


As the photo illustrates, simplicity alone doesn’t make a message potent. What’s missing? Two crucial factors that Howard Gardner describes in his book Leading Minds: how effectively the scripts are enunciated and how convincingly the deliverers of the communications embody the scripts. On those dimensions, “now serving food” doesn’t demand rigorous analysis.

In marketing and sales, we live and breathe message potency. We have to. Everything we do must nudge, push, or demand a change in one or more entrenched behaviors. So, when it comes to potency, could the intended change be as significant as the message itself?

To answer that, we must address a challenge even more basic than potency: how to select the right issue to address in the first place. From experience, I know it’s hard to get it right. In business, we tout high ROI when our clients want strategic enablement. We push strategic enablement when cost reduction matters most. We communicate about best practice knowledge transfer when the greater issue is how to build communities. We promote social media tools to build communities when a client’s overarching concern is managing profitable growth. Our assumptions leave us in a fog of sometimes-happy ignorance. Most exasperating, our prospective clients usually can’t tell us that we’re attacking the wrong issues because they’re not even aware of our companies or our products!

Happily, every now and then, we find a great example that reminds us that we can connect to visceral issues and make our communications potent—but first we have to understand what the issues are. An advocacy group called Food Democracy Now (FDN) has a mission is to advance “the dialogue on food, family farm, environmental and sustainability issues at the legislative and policy level.” Against a powerful food industry lobby intimate with the complexities of the Farm Bill and the machinations of the National School Lunch Program, Dave Murphy, FDN’s president, faces a daunting challenge. According to a recent article in The Washington Post (“Where Policy Grows," March 25), Mr. Murphy recognizes that it’s not only important to understand the legislation, but to “recast the debate about good food from a moral battle to an economic one. Take the school lunch program, which Congress will review this year. Food activists have long argued that more fruits and vegetables from local producers should be included to help improve childhood nutrition. But Murphy says the better way to sell the idea to legislators is as a new economic engine to sustain small farmers and rural America as a whole (italics, mine). Talk about nutrition and you get a legislator’s attention, he said. ‘But you get his vote when you talk about economic development.’”

Bland? After all, ‘economic development’ lacks originality—many times over. In addition, because righting economic wrongs isn’t FDN’s primary mission, Mr. Murphy could be forgiven for being more pedantic about nutrition, health, and the environment. But he knows that by building an economic frame around his cause that FDN will accomplish more than it could through moral grandstanding. By going after the wrong issue Mr. Murphy would find promoting his cause a much tougher row to hoe (pun intended).

Mr. Murphy’s circumspection about issues applies equally to other marketing challenges with differing complexities. What does finding the right issue mean for achieving a targeted return on invested capital? Sales productivity? Reducing sales risks and shortening sales cycles? Meeting revenue forecasts? Everything. Attacking the wrong problems (or attacking the right problems the wrong way) creates a cascading set of selling failures. When it comes to changing entrenched behaviors, not all issues are created equal. For maximum potency, messages need a highly motivating context, and that means choosing the right issue.

Like FDN, when you find the right one, you can change the world!

Hold the Trust: A "Trusted Advisor" Who Earns a Sales Commission is Just an Advisor

“We want our salespeople to work as trusted advisors to our clients.”

The VP of sales who shared that idea has a noble vision, and he’s not alone. Building customer trust is inseparably connected to building shareholder value. Not surprisingly, there's great interest: searching the phrase “how to build customer trust” returned 3,890 results on Google. But the VP has a conflict: his sales team is “coin operated,” vernacular for “they earn commissions based on revenue.” Could that undermine the platform of trust that’s core to his strategy? After all, his customers don’t know his company’s sales commission plan, and it’s no secret that clients don't always benefit.

In the US, commission-based arrangements for sales forces come in many flavors and varieties. And they're widespread, according to Barry Trailer of CSO Insights. His company's research found that of companies responding to their 2008 sales compensation survey, 98% included variable pay as part of their compensation plans. I know from personal experience that a commission-earning salesperson walks a fine line as a Trusted Advisor, and there's an ethical morass on either side.

Variable pay by itself doesn’t destroy trust, but the opacity that commonly accompanies it does. The headlines we've read about AIG and Madoff remind us why. In The New York Times, Frank Rich wrote “The question in the aftermath of the Madoff calamity is this: why do we keep ignoring what we learn from the black boxes being retrieved from crash after crash in our economic meltdown? The lesson couldn’t be more elemental. If there’s a mysterious financial model producing miraculous returns, odds are it’s a sham—whether it’s an outright fraud . . . or nominally legal, as is the case with the Wall Street Giants that have fallen this year.” And Republican Richard Shelby of the Senate Banking Committee, quoted in The Wall Street Journal (March 17), said of AIG's widely-condemned bonus payments “There’s been no accountability, no transparency to speak of. . . Whatever we’ve gotten, we’ve had to extract it piece by piece, little by little. There’s too much secrecy.”

Agreed. Secrecy stinks. But Madoff committed deception. AIG . . . didn’t. And in what way do these issues relate to an Account Executive who sells professional IT services to companies in the Midwest? Fair question. There is a connection. Customers think salespeople have something to hide—and that’s a trust breaker. In a March 2, 2009 issue, InformationWeek reported the results from their survey of 345 technology professionals. The participants were asked “if you could get vendors to start doing one thing, what would it be?” Thirty-four percent of the respondents indicated “being up front about how their products do and don’t meet customer requirements.” That was more than twice the percentage for any other response.

In our technology-rich world, it’s humbling to think that good old fashioned honesty exists at the top of the list of customer wants. If only we could easily give our customers what they’re begging for. But for a salesperson with money on the line, “being up front” presents a wide ethical strike zone. And companies use variable pay to influence a myriad of actions, which include the ethical decisions the sales force makes. (Specific ethical dilemmas salespeople face are discussed in an earlier CustomerThink article, "On My Honor As a Salesperson: Why Sales Ethics Matter") Similarly, in my selling past, there were many background situations I didn’t disclose, but they influenced the advice I offered. For brevity, I’ll list just four:

Service plan revenue generated 8% commissions (at the time, the highest percentage category)

Selling direct to customers (versus through a channel partner) credited 40% more revenue toward achieving my sales quota

There was a quarterly bonus of $10,000 for achieving the quarterly revenue goal

Competitive displacements earned higher commission than installed account sales

In March, I decided to investigate this issue in more depth, and through LinkedIn I asked salespeople “Do you think prospective customers should know how much their salesperson might make in commissions and/or bonuses from their purchase transaction?” Although the number of responses received wasn’t large, they supported the idea that for salespeople, such transparency was not needed—with one notable product exception: sales of financial securities. A few nuanced views discussed the importance of disclosing to a customer how much a broker might make selling Security A versus Security B. But why draw a boundary around financial services? Shouldn’t customers of other products and services demand equal levels of transparency from their sales advisors?

Some companies believe so, and in the name of increasing shareholder value, they have adopted a progressive view for creating sales trust and transparency—and been rewarded for the effort. The Wall Street Journal reported on March 16th (Best Buy Confronts Newer Nemesis) that Best Buy CEO-designate Brian Dunn “opposed (Best Buy’s) 1989 decision to do away with commissioned sales in favor of salaried staff, which was widely opposed by sales workers who feared losing income. He now concedes it was the most important shift in company history, lowering worker costs, and changing the core model of electronics retailing. Best Buy expanded across the US, and Circuit City eventually followed by eliminating sales commissions.” To the victor go the spoils. Analysts believe Best Buy will capture half the business of now-defunct archrival Circuit City.

There’s more to that story than just sales commissions, but it’s worth pondering how—for a business as complex and dynamic as electronics retailing—elimination of sales commissions was granted such honored recognition. As one who eschewed buying from high-pressure Circuit City salespeople, I know the decision had as much to do with improving customer experiences as with lowering labor costs. According to Mr. Dunn, “we want our stores to morph into a series of experiences . . . to do that, you need to go where the rubber meets the road, the sales floor.” For Best Buy, eliminating sales commissions makes it easier to foster the transparency required for creating valuable customer relationships.

Outside of electronics retailing, improving customer experiences doesn’t mean eliminating variable pay, but it does mean looking at sales compensation differently. Are the right outcomes rewarded? Does rewarding revenue achievement alone work at cross purposes for maintaining excellence in customer experiences and building loyalty? Does increased transparency matter to customers? When it comes to trust, what changes would be most valued? If transparency is increased, what additional changes would cascade throughout the sales organization? Would those changes be positive for building shareholder value?

Best Buy, which now has a new major competitor in Wal-Mart, has the right perspective on trust, transparency and customer experience. I hope others will follow their example.

When False Expections Lead to "I Don't Think There's Anybody Back There"

If you’re old enough to remember Wendy’s Where's the Beef? commercial, you’ll recall Clara Peller, the woman on the right of the skeptical customer trio, slipping in one final barb, “I don’t think there’s anybody back there,” as she struggles to peer across an oversized sales counter. I doubt if anyone reading this hasn’t wondered the same thing at least once after clicking “submit” on a customer support web page.

The commercial parodies the frustrations of customers trying to squeeze a plaintive request through a monolithic corporate bureaucracy, and it would be even funnier if it weren’t so true. The ladies’ voices echo off stark, confining walls, ominously distorted by the camera. It’s unclear who they are talking to. There’s no response to their now-iconic question “Where’s the beef?” Dancer Fitzgerald Sample, the ad agency that created the commercial in the early ‘80’s, might have been unintentionally prescient of Voice of Customer (a yet-to-be popularized term at the time) challenges in the age of the Internet.

Technology hasn’t made us any better at hearing customers. But the issue is greater than companies using simple email services and Web 2.0 to craft a “we’re listening to you” image for their customers and prospects. That over worn approach has now become a cliché. It’s about companies taking action when they’re creating the expectation that they are going to take action.

In the last two weeks, I’ve requested support from two companies, CraigsList, and a communications service called DimDim. Both companies offer an online feature that enables a person to send questions and other information from a web page. In both instances, I carefully composed a written explanation of my support question and clicked “Submit.” Then—nothing. It’s more than a coincidence. It’s happened with other companies enough times that when I see Clara trying to peer over that counter, I know exactly how she feels.

What should customers expect? Well, at the very least, to receive a response. In the case of CraigsList and DimDim, an auto response such as “Thank you for your question. Because our support manager decided to take two months off to go mountain biking in the Andes, it might take a week or so to answer your question.” would be better than to hear nothing at all. A few websites offer a great service that requests my phone number online. Within one second after clicking “submit,” my phone rings! Then, an agent gets on the call. At least I know there’s someone on the payroll!

Failure to support breaks trust, and breaking trust is fatal for successfully selling anything. In an era when so many past truths are called into question, the certitude of “no trust, no sale” might even be half comforting.

I don’t care how cool a company’s technology is. When they belly flop on customer support, what message does that send about how they care about their customers? What information do consumers receive about the capabilities of their operations? What do they convey about their ability to provide value in the future? I don’t think there’s anybody back there!

What Makes a Social Network Valuable? The Answer Might Surprise You

“What do we know about the networks of high performers? What promotes knowledge worker productivity? What would you do if you could see the networks? What would you do differently?” Rob Cross, author of a new book, Driving Results through Social Networks, shed light on the answers to these questions and others in a webcast I attended on February 19.

These questions are especially important because the answers lead organizations away from practices that worked a year ago, but might not today. For example, if you really want to know how your firm won a new client, what’s the value in knowing that your marketing team began by mining a database? As Mr. Cross shares, “when you look inside teams and see networks that are forming around an idea, you get a totally different perspective about how value is getting built in organizations.” And that perspective offers killer insight for sales teams.

The Social Network Analysis (SNA) tools Mr. Cross describes identify bottlenecks and gaps that hinder customer relationships. They also identify where “value is built out,” and where cross-selling occurs—insights particularly important for large, multi-division global organizations. Adding more Web 2.0 connectivity won’t help. According to Mr. Cross, “we don’t need more calls, meetings, and emails.” The key strategic and tactical changes result from learning where and how organizations need to add social network connectivity, both internally and externally.

Mr. Cross offers a social network taxonomy and fascinating statistics that upend entrenched views about how ideas are created, sold, and implemented. Three types of people hold critical importance:

Central Connectors: Leaders, experts, long-term employees. Central Connectors represent 3% to 5% of the individuals in a company, but account for an astonishing 25% of the value-added ties—relationships that foster the transfer of best practice knowledge, innovation, and revenue. Unfortunately, when it comes to information flow and value exchange, the same people can also create bottlenecks and impediments.

Brokers: The “unsung heroes” of an organization. Brokers drive change through organizations through their cross-division, and cross-department connections. Mr. Cross discovered that a paltry 30% overlap exists between these enablers and the “top talent” that corporate HR departments identify through traditional contribution measures such as revenue achievement. Ignore the insight at your own risk. Many know from painful experience what happens when a company lays off a critical inside resource who was viewed as “overhead.” “We’re sorry about Tom. He just didn’t have the numbers to justify our keeping him on board.”

Peripheral players: As the term connotes, peripheral players have few connections, and 40% are newcomers to their organizations. This issue presents special challenges for distributed sales forces. When new salespeople are brought into an organization, their companies suffer from long periods of low productivity as salespeople assimilate the tacit knowledge required for the job. But as Mr. Cross points out, social network analysis identifies opportunities to more rapidly connect peripheral individuals—and the knowledge [i]they[/i] bring—into their organizations.

So given these archetypes, what [i]do[/i] we know about high performers and their social networks? One thing is clear: bigger is not necessarily better. Through his research Mr. Cross found that high performers

Develop networks that minimize insularity

Maintain balanced ties across organizational lines

Nurture relationships that extend individual expertise

Mr. Cross demonstrated how to identify these individuals through looking at actual network diagrams. In one instance, using just one mouse click, he subtracted them from the network. The remaining people in the network appeared almost free-floating in space, untethered to Central Connectors in other divisions remaining on the screen. Through this representation, the real-world result becomes chillingly apparent: a company that doesn't know its key liasons with its customer community can become virtually isolated if--and when--those individuals leave. Does the possibility that this could happen (slowly [i]or[/i] quickly) keep you up at night?

Advances in Social Network mapping will enable companies to examine collaboration for sales and business development in a new light. What are the strategic opportunities? The risks? The costs? Mr. Cross frequently points out the irony that companies scrutinize routine travel expenses to the penny, but don’t often track collaboration costs such as time spent in meetings—possibly a far more significant expense for many corporations.

Mr. Cross shows that the energy that flows around the creation, development, and implementation of ideas can not only be documented, but that social network analysis yields new ways to model how enterprises create and transfer value. As the state of the art matures, it's exciting to think about how companies will use this insight. Which new strategies, tactics, and processes will result?

Do Salespeople Bug You? Here's Why They Won't Go Away

Search the phrase death of a salesperson on Google, and it will return around 15,000 results. This corruption of the title of Arthur Miller’s iconic play Death of a Salesman has become embedded in blogs and articles worldwide. But as Mark Twain said, “the rumors of my death have been greatly exaggerated.” Unless you live in Cuba, North Korea, Laos, Vietnam or China, sales professionals won’t vanish. Not now. Not soon. Not ever.

Why? In capitalist economies, organizations must acquire customers to survive, and that requires leading change—and leading change requires selling ideas. People malign the art of selling, people diminish its importance, people even wish it away. But whether you’re discussing weight-loss plans or economic reform, minds won’t change without one very human interaction: someone must sell an idea. And we work with idea sellers every day. They’re called Associates, Agents, Account Executives, Senior Solutions Marketing Managers, Directors of Product Management, VP Sales, Senior VP Global Sales and Business Development, Chief Marketing Officers, Customer Account Managers. Add your own title and the list goes on.

In 2006, the U.S. Bureau of Labor Statistics reported that out of 132,600,000 US workers, 10,464,000 were in “Sales and related” jobs—about 8% of the workforce. This number of jobs—sub-classified as retail salespersons, cashiers, sales representatives, and their first-line supervisors—reflects both the diversity and complexity of the selling process. Selling change isn’t easy. And there’s friction because salespeople and customers don’t always get along. Not all salespeople provide value. Not all customers are open-minded. Some products aren’t easy to buy. And when it comes to fair play, no party to a business transaction can claim exclusivity on the ethical high road.

There’s additional upheaval. Foundations of trust shift. Technology and other forces change once-stable commercial relationships. In some sectors, sales jobs are lost—in others, they’re gained. But it’s illogical to interpret recent trends as portents for the eventual demise of the sales professional. Automation and business process reengineering will no more eliminate the need for salespeople than changes in healthcare delivery models will eliminate the need for doctors and nurses.

I’ll take a contrarian position from many hyper-caffeinated emarketing and social media experts: we’re a long way from replacing salespeople with mouse clicks and drop-down menus. When it comes to Great Customer Experience, the automation we’ve created stinks. Proof? We can scale our selling models through information technology, but we still can’t wean ourselves off "human intervention" (oh, come on, Andy, just use the word salespeople!): “To speak to a representative, press zero.” “If you need help selecting a product, just ask one of our retail floor Associates.” “To initiate online chat, click here.” “If you’d like to meet with one of our Sales Representatives, enter your email address.”

Still, the critics complain that salespeople often inject themselves into the buying mix. “We don’t need them,” the critics say. “After all, they’re only thinking about their next commission.” I’ll accept the criticism. As my VP of sales fittingly said “any salesperson who doesn’t add value risks being replaced by a kiosk.” But over 10,000,000 “sales and related” US jobs suggests that buyers also need salespeople.

The critics won’t admit it. “Salespeople are unethical.” “Social media changes everything. We get better information through blogs and online product reviews.” “Let me tell you about my last encounter with a salesman . . .” I’ve held these sentiments myself—and I’m a salesman! But much of the enmity is misplaced. Salespeople are not inherently bad. It’s the culture under which salespeople work that needs overhaul. Customer relationship problems start with people at the top of the organization chart, whose faces aren’t often public. Those executives create business plans that contain financial forecasts that are divided into sales quotas that are measured in revenue that are credited against the salesperson’s “individual goal.” Ready to talk about improving the “customer experience?” You’ve heard it before: It’s the system, stupid!

Maybe what’s needed is a redefinition of sales itself. What does "sales" mean in the context of leading change? After all, isn’t leading change fundamental to every organization’s strategy? Interpretations will be the progenitor of new ways that sellers and buyers connect and relate, new processes, and new best practices.

Perhaps it’s gratuitous for a salesperson to espouse that nothing happens until somebody sells something. But in the non-communist world, I haven’t found a more accurate statement. The sales professional is far from dead.

Senior Moment: What Our Elders Can Teach Us About Sales

Yesterday I received a sales letter that hit me like a breath of fresh, un-digitized air. I wanted to share it with my readers:

Dear Friend:

As we enter the new year, conditions are not very good for purchasing new supplies and equipment. However, there are some signs that this may improve as the year progresses.

Your responsibility as a department manager or property manager is to maintain your facilities in the best possible manner. I have three things to offer:

Excellent products
Good service
Fair prices

If the need arises this year for you to replace or add to your equipment, please don’t hesitate to give me a call. I will be happy to furnish you catalogs and written quotations for your consideration.

Sincerely,

My friend Stanley’s name follows below his hand-written signature.

Three paragraphs, two sentences each. There’s purity of form and a sincerity that rarely emanates from today’s marketing communications.

Stanley began his sales career before most of us were born, and he hopes to achieve the milestone of entering his ninth decade this year. He’s a retired CEO who is passionate about selling. He’s never stopped. When he started working, ‘personal selling’ meant . . . personal selling. Telephones, “snail mail,” and cars were the tools of the sales trade. Most of all, face-to-face dialogs created the trusted bonds between buyer and seller, and were an inextricable part of the sales process. Little wonder that Stanley’s letter says “I care” so clearly, without using those two words. He perfected that skill in the trenches, by looking at his customer in the eye.

In our Twittered, Blogged, and Web 2.0’d sales world, Stanley’s selling talent has become rare. The forces of information technology, product commoditization, and cost reduction have pushed legions of salespeople from the prospect’s office to the deep innards of the call-center cube farm. Millions must make their quotas using far more sophisticated tools than Stanley had—but without ever physically shaking hands with a customer.

As Stanley approaches his 80th birthday, he has become rare in other ways as well. He’s part of a shrinking population that will all but vanish in twenty years: a self-selected group of senior citizens that choose not to use a computer. He doesn’t use email or a have website for his company. He puts up with my e-marketing hubris when I rib him about not being able to accept orders online (FAX and phone work fine for him). The few times he needs Internet access, he taps an eager pool of knowledgeable grandchildren. It would be easy to dismiss his knowledge as outdated.

But the wisdom contained in his letter reminds me that when it comes to selling, seniors have a wealth of knowledge for the rest of us. Stanley has taught me how courtesy, respect, and sincerity have great power in sales. I wish Stanley many more great years in selling. I still have much to learn from him.

Money is Tight. Where's the Biggest Customer Experience Bang for the Buck?

By Andrew Rudin, Outside Technologies, Inc.

The VP of Sales at a software company I worked for frequently chided his sales force not to boast to prospects about recent wins. "Customers are always unhappy within the first 90 days of an install."

He was right in one way: our customers were invariably disappointed early. But he was wrong in accepting customer rancor as inevitable, and his myopia cost his sales force and the company substantial revenue. What was the company's strategic CRM blunder? I'll describe that in a moment.

If you graph customer expectations over time, one inarguable high point comes immediately following the sale. Why? Because salespeople have an understandable tendency to over-promise results, especially when quotas--and jobs--are on the line (been there, done that). On the customer side, harsh spotlights turn on the decision makers as anxious colleagues look for quick, tangible improvements, or detractors salivate for opportunities to say "I had serious doubts about the vendor choice." Meanwhile, the decision makers seek validation for why they made the best decision from a pool of qualified competitors. Word-of-mouth is in hyper-drive. My experience has been that a significant number of queries are exchanged immediately post-sale (Although I haven't taken formal measurements, I'm interested in learning if anyone has).

If there's ever a time you need to love your customer, it's right after you first shake hands when referring to your prospect as customer. Hugs all around--for 90 days! What better time to provide the decision makers with every reason that he or she made the best choice?
What did my employer do? Management scrutinized departmental financial performance for every part of the delivery, and customer satisfaction measurements were omitted from the equation. What did that mean? Revenue was split between departments: custom development, warranty support, packaged application sales, installation and training, and product management. Expenses were measured down to the penny. From a customer perspective, support was grudgingly parsed. Meters were ticking for every direct customer interaction--and behind the scenes as well--because no department wanted to "eat an expense," an expression that became well-worn at internal client meetings.

What dynamic does this problem create for a sales organization? Notwithstanding the incredible amount of time a salesperson must spend responding to calls and emails that open with "Before we bought this, you told me . . , " consistent service breakdowns destroy credibility. When that happens, sales don't repeat easily, and cannot scale--two must have's for growth-oriented strategies.

What should my company have done? Hindsight offers vivid clarity. A management planning horizon that extended beyond the current quarter would have helped. A business strategy that included in its financial calculus the lifetime value of the customer would have made general ledger expense silos less dysfunctional. At the very least, internal bickering would have been minimized as managers strategized how to create value for customers as well as themselves.

Business strategies have the best opportunity to work when a customer says "I made best choice given what I knew at the time, and if I had to make my choice again, I'd do the same thing."

Look Both Ways Before Making 2009's Sales Resolutions!

In the past, making resolutions was a challenge that was easy for me to delay. After January 1, the world kept moving and I moved with it--resolution ready or not! But so much changed in 2008 that I felt a steadying resolution or two might help. So I grouped my 2009 sales resolutions into two Janusian groups (owing its name to the Roman god of gates and doors, Janus, whose vigil required him to look in two directions):

Things to continue doing
Things to do differently

Things to start doing
Things to stop doing

Before January’s calendar rolls into double-digit days, I wanted to share my list for my clients and other enterprises:

Things to continue doing (for some people, after 2008, this might be the shortest of the four lists!):

1. Setting strategic goals that push the envelope (sometimes called BHAG’s—Big Hairy Audacious Goals).
2. Exploiting social media communication to achieve corporate strategies.

Things to do differently:

1. Develop not just many social media connections, but those that provide the highest value to enterprises: innovation, revenue achievement, and knowledge for process best practices.
2. Reorganize marketing and selling processes to address redistribution of information power and changes in how people buy.
3. Trust, but more skeptically. As author David Berreby said, when writing about trust in the New York Times(March 30, 2008), Stanley Milgram’s famed electric shock experiments show “in difficult situations, when (people) wrestle with the line between trust and skepticism, trust often wins. Much of the time, that’s a good thing.” The aftermath of Bernie Madoff’s scheme suggests differently.

Things to start doing:

1. Ask a teenager for ongoing, in-depth tutorials about how to use Facebook, Twitter, instant messaging, and other social media tools (if you haven’t already done so).
2. Seek opinions from people, books and blogs that are controversial or even disagreeable.

Things to stop doing:

1. Flogging the sales force for more productivity and more revenue output without providing better tools, training, or process improvements.
2. Delaying strategy decision making “until we know what the economy is going to do.” The forces in world keep moving. Could the risks of indecision be greater than the risks from a wrong decision?

What’s on your list?

Why Sears Customers Continue To Suffer

(first published March, 2007)

Sears--the retailing powerhouse that broke down paradigms for how consumers purchase hardgoods hasn't figured out how to maintain their visionary edge. Many would argue that they lost it many years ago. Today they are the poster child of companies that say--no, shout--to their customers: "We're happy to take your money. After that, we don't care."

Here's the evidence: last August, we purchased a relatively inexpensive refrigerator to replace our failing 15-year-old unit, which had been housed in our garage. We found it on the Sears website and engaged in a conversation to clarify a few questions with Sears customer service before placing the order. At the appointed time, two men in a Sears delivery truck arrived and, delighted that this stop didn't involve taking the new refrigerator around the back and up 4 flights of stairs, happily placed the new unit in the spot in the garage location formerly occupied by the old one. They thanked me for the order, took our old refrigerator, and drove off less than 15 minutes after they arrived. I paid about $20 for this service, which was fine.

The refrigerator worked well until this winter, when the freezer mysteriously stopped keeping our frozen food frozen. The refrigerator was still under warranty, so I contacted the service number printed on the manual. After over 90 minutes of phone hold "press 1, press 2, press 3" agony, I persevered and spoke to a customer service representative who blandly asked me to open my manual and to read some text embedded on a paragraph on page 12 that indicated my refrigerator was not built for use outside of the temperature confines of a typical American home. Therefore, garage and back porch installers need not apply! I informed him that this information was not shared with me--not by the Sears website (which didn't state "Not designed to be installed in unheated areas in colder climates), not by the order desk personnel I spoke with before ordering (I told the representative the unit would be installed in my garage), and not by the delivery crew (who PUT it in the garage)--and I also told him that Virginia, in fact, experiences freezing weather in the winter. He further impugned Sears by saying that this issue comes up all the time. "So why doesn't the website provide the appropriate information?" I asked. "I guess nobody outside of tech support really knows this," he responded. At this point, I asked him what is the process for resolving this problem resulting from what I felt was an irresponsible omission of key product information--times 3! He said they would have to send a service tech to my home to see if it could be fixed. "FIXED--How? you just told me it won't work, according to page 12! What is your service tech going to do or tell me that you haven't done already?" He responded that that is his process and he's sticking to it.

A few days later, according to Sears Plan, I received a friendly automated recording from Sears informing me that a service tech would arrive at my home the following Saturday--somewhere between 8 am and 5 pm. Not being exactly overjoyed at the prospect of spending the entire day at home further contaminated what little expectation I had of achieving any positive result from this "process." I called Sears back and firmly committed that I would make no commitments to staying at home all day on a Saturday (did Sears think I had nothing else to do?). In fact, a service tech did show up when I wasn't at home. Little wonder. A few days later, exactly according to the Sears "process" script, another friendly recording arrived in my voicemail inbox, offering another window of opportunity for a service call--this time during the week between 8 and 12, which I accepted.

On the scheduled day, a friendly, but jaded, service tech arrived and confirmed what I already knew: the compressor on the freezer wasn't designed to operate in temperatures below 50 degrees. "I'll write this up in a case and let them know what I found. At this point, there's nothing I can do." Who is "them?" I asked. He said the store manager at our local Sears. "But I purchased this online," I said. No matter, he told me--the local store would have to resolve my issue. "I see this all the time," he said. "I don't know why they they sell these and install them in this climate. They should know better. So many people buy these in the summer and they are happy. Then winter hits and they don't know what happened. I see it all the time." All this information about how preventable this misfire was didn't leave me with a warm feeling.

Contributing to the evidence of how pervasive is the ineptitude at Sears is this fact: the refrigerator cost less than $450. Did it even occur to the product planners and buyers at Sears that such a low-price model might be utilized by someone in the United States as an auxiliary appliance, and therefore might be installed in a location other than a kitchen? Clearly, that question was never asked by people who should have asked it. (Although I sardonically envision a lowly Sears intern voicing concern, but quickly dropping the idea after withering in the conference room before the pompous glares of his superiors.) Like most systemic customer support problems, the organizational partitions that managers faithfully create lose their utility when the challenge becomes "how do we demonstrate to our customers that they matter to us?"

After 3 weeks,I haven't had time to contact Sears to figure out what to do about the appliance they so flagrantly misrepresented. And as for the Sears resolution "process:" No follow up call from Sears, no resolution, no anything. Maybe they'll give me another automated call--this time with a synthesized voice saying "Hi! This is Sears! We just want to let you know we care. Goodbye."

It's still winter in Virginia, and all of my outdoor freezer stuff is in my indoor freezer so it won't spoil. I can't wait till the weather turns warm so that my freezer will work again. Then I'll call Sears to let them know--in the vain hope that someone cares.

Clearly Sears is adept at completing the sales transaction: my credit card payment and delivery order were processed quickly and efficiently. They still haven't figured out how to make the customer experience satisfactory. It's the last product I'll ever buy from them. Oh, and that includes Land's End, too! I can't wait to show my friends how well my Sears refrigerator works! Maybe I'll spoil some sales to go along with my spoiled food!