Ten More Years of THIS?!

Despite Paul Krugman's column today (12/28/09), no one needs to be reminded that the decade now ending was an economic disaster. But you have got to read this from today's msnbc if you really want to get depressed.

In short, it says that unemployment will stay high for most of the NEXT ten years!

Citing "most economists," the article says that unemployment won't get back down to 5.5% until 2015 at best, and will average 8% through the decade. There is no "next big thing" to boost the economy, the hole we're currently in is very deep, productivity growth is soaring, and the Boomers can't afford to retire - squeezing the younger generations out of the job market.

As a result, wages will continue to stagnate. But don't worry if people won't be able to afford to buy anything... because they won't be making anything.

Just remember Henry Ford's greatest contribution to the world, and it wasn't the assembly line. It was the $5 wage. And why did he do it? So his employees could afford the cars they were making!

That was then. This is now.

Call Backs

Many telemarketers avoid leaving voice mail messages because they don't think they'll get any call-backs. We almost always do - although it's always of a specific type - and today that strategy was validated.

One of our folks got a call-back from a prospect: Evidently the employee responsible for the function that our client helps with quit, and left them in a lurch. We had been leaving voice-mails for the President for around two months, and he wanted to know how soon we could get someone there; he was ready to buy.

That voice mail message was worth around $50,000.

I'm Going NUTS...

With companies cutting back staff to regain profitability in the recession, decision makers are harder to reach than ever. Where it used to take 3-4 tries to get someone on the phone, now you can't do it with 20 attempts. So what do you do?

I can't take credit for this idea, (I actually got it from a rep named Jeannie Gazurian at RSI,) but it's a great one, and it works: Send the prospect a tin of nuts, with a cover letter that starts with "I'm going NUTS trying to get you on the phone!"

Be sure to include your IBS and other call elements. And don't use peanuts (cashews or almonds are safer.) But you'll get the call-backs and put-throughs you need.

Remember: Doing the same thing over and over again, and expecting a different result, is the definition of insanity.

Sell Band-Aids!

As we were talking about the disaster that is our economy, it occurred to us (Denise, specifically,) that no one is making any investments; they're just putting Band-Aids on their problems. Instead of buying a new car, they're fixing the old one. Instead of buying a new IT solution, they're patching the old one.

So, it occurred to me, if people only want to buy Band-Aids, we should be selling Band-Aids! That's how to position your offering. Don't sell it as a solution, sell it as a temporary fix - until things turn around and you can afford a real solution.

To do this, you need to look at what components of your offering can provide a stop-gap solution to the prospect's problem. Do you have something that they can use to stop the bleeding (in your area of application)? Sell that; don't try to sell the whole system. At least then you have a new customer, whom you can later build upon.

We have numerous campaigns that can benefit from this kind of repositioning. Do you?

The Value of Precise Targeting

I received a call yesterday from a prospect who's seen his new business pipeline dry up in the last two months. He owns a company in the metals business, and although he's quoting more than ever, he's closing less than ever - something we've seen a lot of lately.

While it may look like there are a lot more tire kickers around lately, there are a couple of things to keep in mind. First, companies aren't shopping price; things just aren't moving forward. The number of unfunded initiatives seems to be going through the roof; and no one has the resources to compare multiple vendors anymore.

The traditional solution of "casting a wide net" won't cut it, though, since so many prospects are out of business, or close to it. If you have 2,000 companies in your database, for example, there's a good chance that 3/4 of them are in some state of despair: At best struggling to hold onto whatever business they have. Therefore, a broad-based prospecting program is likely to have 75% waste in it or more - a potentially catastrophic amount.

Doing some homework can significantly reduce the risk of your prospecting program. Start with secondary research. Use BusinessWeek's Quarterly Scorecard to identify segments or verticals that have some growth. Then pre-qualify your prospects. A quick phone call can determine if the company is alive. Are they spending? Do they have any initiatives? How are things going? And who should we be talking to? Then get off the phone and go to the next prospect. Once you've identified the 10% who are still breathing, then go back and make a real prospect call.

Pre-qualifying can save money in the best of times. In the worst of times, like we have today, it can save your whole company.

So What's the Deal?

On Thursday the government announced that GDP grew by 3.5% in the third quarter, so on Friday the stock market dropped by 2.5%. What gives?

Pundits talk about the recovery as being "fragile," but what does that mean? In short, it means that businesses have managed to cut expenses enough to get back to profitability (on a lower base of revenues,) but if demand falls any more they're going to have to cut again - and we're going to have another big dip.

To be clear, the stimulus has done virtually nothing to support demand, as now the government is admitting that at least half the jobs saved were teachers. Almost no construction jobs, no manufacturing jobs, and no services jobs were saved, created, or even dreamt about. Not that I'm against education, but there are just so many Chinese TVs these teachers are going to buy - and what does that do to help the US economy in the near term anyway?

More importantly, if you spend $700 billion to create 700,000 jobs, even a fifth grader can figure out that that comes out to about $1,000,000 per job. Do you know how many jobs I could create for $1 million? A whole hell of a lot more than one! (How about 20?)

Okay, enough ranting. What do you do about it? Until employment really starts to rise, the only thing you can do is try to steal market share from your competitors. Now that you've gotten your costs down, it's time to start selling your brains out.

I got calls this week from two former clients. Both are worried that their sales pipelines are empty, and they want us to fill them. Smart move for them; easy job for us.

Remember, fat, dumb and happy is just one loss away from fat and dumb.

Recalcitrant Reps

Much has been written about the definition of a "qualified lead." And way too much money has been spent on Contact Management Systems. But when you're generating leads for salespeople, the one thing everyone assumes is that the salespeople actually want the leads.

After all, isn't getting a good lead the most important thing to a rep? Isn't it better to have someone else open the door for you? Well, the answer is usually yes, but sometimes it's no.

Just like a company that can have more business than it can handle, a salesperson may have too many prospects in the bottom of his funnel (i.e. close to closing,) to have time follow up on new leads. So he may turn them down.

The most important factors in whether the rep wants the leads is usually how they're doing against their quota, and when you're talking about. If they're running 130% of quota and it's December, expect a chilly reception. If they're at 75% and it's June, let 'em rip.

By the same token, they rep who's ahead in December could say to himself, "I need to fill the pipeline for next year, so I'll take anything I can get." And the rep who's at 75% in June might be there because he's just bad at the job, and you'd be throwing the leads down a rathole if you give them to him. So the maturity of the rep is equally important. (We'll talk about Prima Donnas in another post.)

This is where good Sales Management comes in. Start from the assumption that a regular flow of good leads is better than trying to time the rep's demand for leads - as an extra bonus, this will help smooth out the boom-and-bust cycling of revenues. Then teach good territory management techniques - ones that balance working on C, B and A prospects simultaneously, rather than dumping the funnel every few months.

Proof That Our Approach Works

We often cite the statistic that "there are over 2.5 million telemarketers in the US, but less than 5% actually know how to make good cold calls." This comes from both secondary sources and the results of the Sales Skills Assessment that we developed.

Every once in a while though, we come across anecdotal proof of this assertion, like this email I received recently:

Dear JV/M:

I had just taken your B2B Appointment Setter position, and based on the information that I read, as well as taking the test; this type of work is simply not for me. I am a very sensitive person, and I cannot force somebody to take a product or service that they either don't want nor do they need. I am more customer-service oriented and an order-taker. I definitely would not be a good fit for this company.

This type of job is for somebody who is very thick-skinned, tough, and aggressive. In a way, I'm glad that I failed the test. I just wanted to try it out and see how it goes.

Thank you for your time and I wish you good luck in finding the right people for all of your available positions.

Sincerely yours,
Lxxx Fxxxxx

P.S. I am also not looking for a work-at-home position. I'd rather work out of an office instead.

Setting aside that the fact that job ad specifically stated that it was for a work-at-home position, this letter vividly illustrates what kind of morons are out there. But just for fun, let's pick this apart to highlight the fallacies that persist in the market. That is, what does our test-taker believe, versus what is the truth?

• Evidently she believes that people who make cold calls have to be insensitive. And while you clearly need to be able to take some rejection, being able to avoid rejection actually requires a heightened sensitivity, and excellent listening skills.
• She also believes that what we do is "force" people to buy products that they don't need, when the truth is that our main job is to find people who have needs, and uncover needs by asking good questions.
• And contrary to her belief that professional B2B lead generation specialists aren't "customer-service oriented," being sensitive to the customer's needs is the key to success in this business - whether that customer is the prospect or the client.

Her summary that the job is for someone who is "thick-skinned, tough and aggressive" mirrors the conventional (albeit incorrect,) wisdom - much like the belief that the main qualification for being a doctor is that you're not afraid of the sight of blood; and that the years of training and education don't matter.

We developed our Skills Assessment so that we don't have to waste time interviewing the 19 people who weren't qualified for the job to find the one that was. Noting, of course, that she failed the test, it's nice to also know that the process itself is self-selecting!

Digging for Gold

It continues to amaze me how hit-or-miss opportunities are. Because of the recession, of course, there is certainly very little low hanging fruit. But I am nonetheless pleasantly surprised at how we're still managing to find new business for our clients.

I would have to describe today's environment as opportunistic - not in the amoral sense of the word so much as in the sense of not being bound by convention or pre-conceived notions.

Let's say, for example, that your traditional market is in some vertical, but your usual marketing and sales methods aren't getting anywhere because the segment is dead. We're finding that, by poking around in other segments, you can find sales. You just have to be a little imaginative, and be willing to experiment. Take off a constraint on your prospect list, and you're likely to find an untapped, and underserved market. Be willing to re-package your offering, and all of a sudden you might find some takers.

Contact Management Systems

Does anyone seriously believe that today's contact management systems help companies sell more, or do so at a lower cost? Without naming names, from what I've seen, these over-engineered behemoths cost far more (in time and money,) than they ever return in sales and margin.

Every installation I've seen is lousy with duplicate data, junk data, and overly complex report modules because these systems are designed to be all things to all people.

Think SIMPLE! Design the system for the salesperson, and let the marketing and management people figure out another way to run the show.

California is Back?

As bad as things are, they're actually better in California than they were two months ago. We've just started calling large commercial property owners/managers, and they're actually taking our calls. Historically, property owners and property management companies ran for the hills whenever a salesperson called. They had their building, and they didn't care to spend money on anything.

Now, however, two arguments seem to be getting traction: Cost reduction and energy savings (which are, of course, closely related.) Could it be that the granite wall is crumbling?

We'll see if things close. But for now, just getting them to pick up the phone is amazing!

Waiting for the Other Shoe to Drop

We talk to hundreds of companies a day. And I get the feeling that we're about to go over another cliff. There is no "end of year money" waiting to get spent. There is no "pent up demand." And now people are talking about a half million companies not being able to re-fi their commercial mortgages when the balloon comes due in 2010.

We did see some impact of the stimulus money over the summer, but haven't heard about too many projects being funded since. Did the Cash for Clunkers program fail to stimulate the economy?

Here's my prediction: Come the end of the year, pink slips are going to flow like water - especially in the management ranks.

Then what? When the survivors wake up on 1/4/10 and see every other office vacant, if you're one of them, you'd better get cracking. There will be no growth that you can ride on, so you're going to have to steal market share from your competitors. Call me if you need help.