Alchemise Insights Interview – 5 minutes with Andrew McFayden – Sales Development Representative

Here is a 5 minute interview for insights with Sales Development Representative,  Andrew McFayden, on tips and what his experience and learnings has been to perform as a successful Sales Development Representative. He shares his view about how the modern customer centric approach is different to traditional lead generation methods which don’t work anymore.


Question 1: What is your view on the role of an Sales Development Representative in today’s market? 

Answer: Andrew 

When I started with Alchemise Consulting it became apparent that the role of the Sales Development Representative today is a unique offering very much different to the standard inside sales positions. While they wear a sales, commercially focus hat, they also need to sit on a marketing chair. What makes this role unique is prior to the 90s (and the digital age of data collection, such as names, phone numbers and email addresses, etc), the marketing department/agency was engaged to attract the customer and compel them to pick up the phone or walk through the door. The sales people then qualified those that walked in and then proceeded with the sale process.

Today the Inside Sales Role (ISR) or Sales Development Role (SDR) performs a bridging function between the two business units and in part prospects/researches and initially qualifies the contacts before introducing the sales team/contact to follow through with closing the sale.

Where the role is able to be fed qualified contact lists from established sales enabled processes, it facilitates the efficiency and focus of the position to facilitate the commercial outcome needed for the business.


Question 2: Have you needed to be more sales or marketing focussed in your day to day activities?

Answer: Andrew 

My focus in the role has been more on sales to qualify the prospect while balancing this with the marketing aspect of researching and profiling, looking for online triggers relating to the companies and challenges/changes that the company may be going through that are relevant to begin initial engagement. This balance of both sales and marketing understanding provides the experience with focus on being customer centric.


Question 3:  Is relevant industry experience or sales experience required, for example to market technology based solutions or high value services?

Answer: Andrew 

Having industry experience for ISRs does provide value with the comprehension of the on the ground language when speaking with the prospective contacts, especially with the acronym saturated Information Technology world. If this is a gap in the ISR’s comprehension and it is not addressed early in the engagement of the ISR then confidence in phone discussion will not be present. This can also lead to misinterpreting key information that is conveyed by the contact. When talking with people in the industry, trying to ‘fake it till you make it’, will destroy the ISR’s credibility.


Question 4: What specific skills/experience and approach do you need to develop to increase your success in the role? 

Answer: Andrew 

As mentioned above, understanding of the industry vertical jargon is important for the Inside Sales or Sales Development Representative. Of equal importance also is the mental fortitude, resilience to be able to shake rejection off, like water off a ducks back. Being phone (trigger) happy as opposed to phone (gun) shy is vital to have in this role. I believe that having an approach of being willing and able to speak to anyone would be an ingrained quality/skill in your ISR. Making numerous calls in a focussed way is also another key requisite of the role.

If the ISR has a customer service/centric approach to the position, in that they are looking at ways that they are able to help their prospective contacts will also be of benefit to the business, the client and success in the role. If the skills and experience are needing fine tuning then having someone to coach you is vital to future success. The other key skill that needs to be developed is common courtesy. Lacking this level of etiquette can ruin the business reputation fast.


Question 5: How did your manager help mentor or guide you in bridging the gap between sales & marketing as a team?

Answer: Andrew 

With the above mentioned, it is worth stating that even with the skills that I started with at the beginning of the engagement. There were additional areas of learning that were also needed. I found being able to verify some of the unfamiliar industry speak, along with a higher level of industry understanding from Chak Ng, greatly assisted with my own knowledge gaps and approach not to mention the guidance on courses best to take that would further improve my own skill set. This highlights the importance of working together and keeping the communication lines open. Working as a team as opposed to having a siloed approach is one of the stark differences, I have seen with Alchemise Consulting as opposed to other organisations that I have engaged with previously.


Question 6:  How did the use of marketing and sales tools CRM/marketing automation help you in your role? i.e HubSpot value.

Answer: Andrew 

Part of this is having processes in place to ensure smooth engagement, a team approach, the use of a CRM that is more intuitive and of value straight out of the box, along with the marketing automation that the tool supplies were of great assistance. The tools and automation enabled me to gain visibility on prospect interactions, thus being able to reach out when the contact had viewed the content/communication that was sent to them and not fly blind and pester the contact when they have been busy with BAU issues that draw their attention. The analytics also provided insight into being able to understand which part of the (PDF) communication was viewed and for how long. This was especially true when used in campaigns.


Question 7: What type of training did you required for each campaign?

Answer: Andrew 

As for the campaigns the additional training that was undertaken was very much bespoke to each business that was engaged with. Knowing the client’s business in preparation with being onsite, immersing and spending time within their business  or reading through additional marketing collateral along with a content map to furnish individual material relevant to prospect discussions. In addition to this any cultural idiosyncrasies relating to geographic region was also required. This all comes down to distinctions or details of the engagement. Without the additional research and pertinent information, it would have been difficult to achieve the results that were gained.


Question 8:  How important is preparation during a campaign setup and which aspects are vital to having a chance of success? 

Answer: Andrew 
This comes back to the initial preparation when starting a campaign. Which as mentioned previously comes down to understanding what the client’s needs are and also making sure that all systems, tools, internal contacts/stakeholders and needed processes are in place before starting the engagement. While I have been at Alchemise I have seen other clients who have adopted a cowboy, gung ho approach and have not realised the success that they were hoping for. When you consider the capital outlay and personal reputations put on the line, it is exceptionally important that informed preparatory ground work be in place prior to implementation of on the ground activities.


Question 9: Can you share two examples where the use of a sales enablement process worked well and what type of customer engagement made sure everyone was in sync?

Answer: Andrew 

A client event set one month in advance is an example of the preparation needed that provided a tangible result through the use of a sales enablement. A list of relevant enterprise companies where supplied by the marketing department and additional scripts and supporting collateral. This facilitated confident discussions with supporting documentation that could be supplied to clients that was relevant to their position in the company. The result was 19 pre-registrations were booked in from C-Level contacts for the event in this time period.

Another example was for another organisation providing Cloud management services that needed to warm up a list that had gone cold due to the timing of the previously implemented campaign by a 3rd party. Scripts were put in place with along collateral marketing material. The use of a CRM that supplied analytical information on individual contact engagement also enabled me to further successfully interact with prospective contacts. The result on this engagement was in just 30 days, from 200 contacts, we achieved 53 leads, 23 MQLs and 8 SQLs.


Question 10: How did you measure success in the campaigns? Can you give me an example of where greater conversion was achieved?

Answer: Andrew 

With each of these two examples above the success was measured in initial qualified preregistrations for the event and with the second engagement it was a pre defined qualification process on what stipulated a MQL (Marketing Qualified Lead), SQL (Sales Qualified lead) and leads that needed further nurturing.


Question 11: What would you suggest to a company that is searching for more leads and approach to lead generation?

Answer: Andrew 

With qualified leads being vital to a company’s survival, I would suggest that with other companies with their own lead generation process, that they work out exactly who they are looking to reach. Have a sound marketing strategy in place with supporting marketing collateral. Define what success will look like with the commercial return that is expected with a set time frame.


Question 12: What is your advice to the many start-up and SME companies you have spoken in the last 12 months about their business growth aspirations?

Answer: Andrew 

For the companies in the last 12 months that I previously spoke to there have been some real observations and useful tips about handling some growth obstacles.

  1. Don’t engage with a creative company unless you have a defined plan on what the commercial return will look like.
  2. Ensure that the agency defines the process that they plan to implement to generate leads.
  3. Make sure that the leads generated are categorised into levels with each level clearly defined so it can be prioritised. If your creative agency is not able to at least provide marketing qualified leads from the work that is undertaken then this should be a warning sign for you.

For more insights about how Inside Sales and Sales Development process and resources can increase performance and conversion, please look at these previous blogs.

To read more about our recent sales and marketing insights and related articles please visit our

Alchemise Consulting News link.

Good luck in 2019!  To kick start your year, we would like to offer you our FREE E-Book on “How to increase your profits with 7 Profit Multipliers!

 

Are you reflecting about your 2019 plans and where you need help with Sales Development or Inside Sales structure, processes or resources?  Feel free to contact us for an initial discussion about your sales & marketing challenges and to book in your independent health check. We can demonstrate specific value by identifying where we can help you and your business accelerate your sales engagement and increase your sales development performance and effectiveness.

Contact Alchemise Consulting at  info@alchemiseconsulting.com or @alchemise_cons or call our office on +61(3) 9225 5022.

 

Case study: Go-to-market strategy for SD-WAN – Australian telco solutions provider

When it comes to marketing complex technology solutions and planning, the engagement of a specialist sales & marketing provider such as Alchemise Consulting will ensure there is contextual and content understanding of the product and service to sell. Depth of understanding for the specific market dynamics to help develop an effective value proposition to develop a solid go-to-market plan both from an industry sales led and marketing perspective is a recommended investment to make.

What is SD-WAN Technology?

  • SD-WAN (software defined wide area network) is an emerging technology that offers several benefits compared with traditional, router-based WANs.
  • With SD-WAN, business decision makers with service providers can achieve cost savings, increased agility and simplification to support branch office connectivity.

The service diversification and growth plan decided by the directors was to look for the right technology vendor partner for SD-WAN solution with comprehensive due diligence before taking the solution to market and testing the relevant strategy.

In building a ground up new capability, several factors internal and external needed to be considered from a resourcing, commercial, product development, sales & marketing perspective.

They spoke with us to assist, given our technology services background in the market and understanding of the subject context from an integrated technology sales & marketing perspective.

Project Scope

Our senior consultant was engaged for five months to work in the role of ‘go-to-market manager’ and tasked with helping to develop the go-to-market strategy plan as Phase 1, ahead of the go-to-market execution as Phase 2.

The scope involved determining the right value proposition and messaging with market testing as well as sales enablement preparation of digital marketing assets.


Our deliverables spanned across both sales and marketing and product components:

Market Research – Phase 1

  • Business vision go-to-market
  • Market segmentation
  • Competitive positioning
  • Definition of offering


Marketing Plan – Phase 2

  • Market position and strategy
  • Sales and marketing enablement
  • Product market launch
  • Operational requirements
  • Financial analysis

Our deliverables and value of sales & marketing experience provided:

  • Developing relevant foundation content that was needed as well as relevant targeted customer centric presentation collateral
  • Digital website content to specifically engage the right audience
  • Understanding and mapping their buyer’s journey and customer problem as the first step of alignment
  • A new website domain and trial marketing automation usage with a CRM and marketing CMS/automation tool by HubSpot
  • Sales execution and demand generation processes and activities
  • Enacting a culture shift to engage internal client resources from digital, development, sales and technical solutions (both internal and from vendor)
  • As part of the go-to-market manager role,  we highlighted the importance of focus on product roadmap, pricing, positioning and packaging research to work at tactically as well as strategically.
  • Executing a strategy requires practical testing in the market as a well as a dynamic ‘hands-on’ approach

After five months fulfilling the requirement delivering the go-to-market strategy, the clarity of market positioning and sales strategy was established as well as deliverables scoped to market test.

Key Project Learnings

When starting from a foundation level, the Directors’ commitment and team time needs to be available for this to be a joint success for Phase 1.

go-to-market-strategy

What a business has in mind or brainstormed for their service offerings may not be a match for what the market wants or is ready for, so market testing or market opportunity research needs to be completed first.

A clear vision and strategic plan is needed as well as taking the time and investment to look at sales & marketing alignment in some detail as part of the go-to-market.

For smaller businesses or niche specialists, the shift to digital marketing in a customer centric manner is important to prepare for omni-channel engagement outside traditional relationship, referral and sales channels. The value of this approach is an ability to accelerate sales and marketing engagement when the solution and services are launched.

When considering new product introductions, there cannot be a solid plan until you complete market research and feasibility analysis.

When most business owners/directors are time poor, the speed to market and right launch preparation is important to develop the team expertise required to achieve this. If you are attempting to launch too early, the opportunity window might be premature to secure customers, or if you are too late, you need to be a market segment leader not a follower generally.

Outcome

We successfully scoped outcomes for the assessment of go-to-market strategy, market research for the correct vendor which was suitable and also developed the digital presence, collateral and sales enablement components of the content plan.

Our value with extensive ICT sector and technology domain knowledge of the market and competitors for SD-WAN helped positioning a productised and managed services model for generation of revenue opportunities in the Australian market.

The value of a flexible arrangement and value as part of the client’s team allowed much further consideration for investment and market knowledge to be developed for the Australian market for SD-WAN. The completion of Phase 1 provides future clarity when Phase 2 (execution) commences.

If you would like specialised technology solution marketing assistance and sales optimisation and help with your go-to-market plans, we can assist with an initial no obligation consultation – contact us for an initial discussion on how we can help you and your business at info@alchemiseconsulting.com or @alchemise_cons or call our office on +61392255022.


CLICK HERE for another case study where we assisted and added value to a UK technology company with their APAC expansion and new Market Expansion feasibility. 

Software start-up businesses: What is your sales and marketing plan?

This blog is part of a start-up series…
Part 1 is available here, if you missed it!

Start-up founders 

This blog piece is intended for a general overview based for a broad spectrum of audience to provide awareness based on examples of many people we have spoken to over in recent years who are venturing out for the first time on their own. We are not referring to serial entrepreneurs who have been very successful in business already.

It has seems a recent observation for successful engineers or IT professionals to venture into entrepreneurship and business ownership as a start up an aspiration. Commonly in a joint business partnership or sole trader may have seasoned commercial or sales and marketing acumen in their team initially.

For some, despite initial quick success it’s still a case of a feature/benefits or referral sell with not a solid go to market plan or strategic approach considered. Are you playing the short game or long game and reverse engineering your desired outcomes over chosen timeline?

Tip: Ask for help early to build an A-team of specialist advisors around you, and be willing to invest to help you test your concept, develop your go-to-market strategy and help build your foundations so you can scale.

Capital and funding

We have seen many start-ups run out of capital very quickly as they haven’t planned out their investment and costs required. For software application development it’s a never ending sunk cost to build the platform foundation from open source platforms and constantly improvement to evolve your offering for customer experience and integrations or address functional bug fixes etc.. If you are a services business the capital requires strong cashflow, securing good resources and a solid sales & marketing strategy for short term success. 

Are you releasing a feature update every month or 3 months or 6 months, or ad hoc? How much budget is required with your onshore or offshore development team? If your sales cycles are longer without the revenue incoming and tested go to market plan, how can you sustain short term investment decisions for growth?

A large portion of costs is initially to setup and progress from concept stage to prototype or beta release for testing . Is there a market for your app and where? There are so many variables to consider in this dynamic, fast moving and crowded marketplace.

Are you aware of Government funding programs such as Austrade Export Market Grant Funding (EMDG) or Department of Innovation, Industry and Science R&D Grant Funding Options?

Have you checked out your local council incentive programs for small business owners starting out?

Tip: Assess realistically and budget for your capital expenditure and cashflow to get a test platform off the ground without overcapitalising, prior to getting any customer end user feedback or usability assessment.


Strategy Go To Market plan: What is your Sales and Marketing approach for B2B or B2C?

start-up-sales-marketing

As a brand new home owner or developer, would you build a house with a builder without going through a planning process first using an architect or draftsperson?

As a captain of your boat, would you set sail in a boat without knowing which direction and compass map or GPS settings are required first?

In business, especially during the start-up stage, it’s the same to plot or determine the course you wish to take and solidify it on a blueprint first. It may not be the perfect plan or at least it helps provide a targeted direction of what is required to get from point A to point B and purpose.

However the investment of time and seeking advice to formulate the right plan seems to be considered in reverse order – ad hoc first before structuring something of a business plan or sales or marketing strategy.

For any go to market consideration you need to understand your business customers first and what problem or solution you can help them solve. In order to monetise your product or services the value of what your offer and charge reflects the urgency or size/complexity of the problem you are solving for your customer.

Too often I have seen little analysis about the financials including realistic cashflow, profit margins and also sales planning and how to create brand awareness through targeted marketing investments – this often seems to be an afterthought.

Tip: We suggest utilising an ROI calculator such as ours or establishing your objectives first: 


Sales Pipeline and Revenue model


We have found many perceived valuations of a business model untested and unproven to attract a buyer is like angel investing…

No real customers = No real dollars despite future projections. Let’s be real here.

Once a external capital round is raised, the pressure is on to deliver ROI to the stakeholders, every request and return for dollar asked is scrutinised about the real viability of the business model and financial returns to the shareholders.

When I have asked many business owners for some pricing numbers about the subscribers needed for their model to break-even in Year 1, or Year 2, many seem to be a pie in the sky guesstimate or hypothesised without some solid tested projections.

business-strategy-start-up

When I further question where and who is their target market, I haven’t received many solid, thoroughly thought out answers but a more whimsical ‘kind of’ or ‘generally’ description.

Without a solid business plan and sales and marketing Go To Market strategy worked through and tested first, many start-up app ideas never will get off the ground due to lack of planning or asking for help first from a business advisor or sales and marketing consultant.

There is a saying that family and business do not mix, this is true to some extent that emotions can influence some of the initial decisions from founders, especially those without some business background or sales/ marketing experience.

At the end of the day you might want to pursue a passion or great idea like many entrepreneurs, however if you are still relying on your job and/or regular income with a mortgage over your head, some of the path to exploring this can be mitigated by being strategic and planning ahead for your financial position, capital investment plan for growth and thinking about your purpose – whether it’s to scale and build a large business or just to replace your income and eventually exit by selling your business.

Make sure you think about your profitability and revenue first as well as market test your pricing strategy for how you will monetise your great software app idea.

TIP: Spending some time for an independent sanity check with a workshop or advice for your concept and business model with the right independent business professionals and also your potential customer base might save you time and sweat equity in getting your idea off the ground or determining if it is feasible.

Here is an example of one of how one of our New Market Entry Feasibility Assessment played out.

Start-up resources

Thinking about if you hire in-house or outsource, what parts of your start-up business and investment cost are required?

The cost of hiring a team of marketing resources like a social media manager, digital strategist, copywriter, graphic designer and web designer all add to the overhead costs of the business and initial investment to build your team.

As we know, the cost of skilled labour in Australia is one of the highest in the world. However is outsourcing functionally  to Asia or other parts of the world still an answer? Are you sacrificing quality over lower costs or lack of your own process and systems? Have you thought about a scalable model to access senior experienced resources that will only cost you a fraction of a FTE hire or long term contractor?

What are the must-have sunk costs, and what are the optional non-revenue generating costs?

How will you generate sales to your customers? Will it by distribution model or direct sales? Will you be paying commissions out of the sale or from your profit margin?

TIP: Consider what sales and marketing resources you need initially and budget required if you hired internally. Can you source alternative and flexible methods to deliver the same function at lower cost and higher ROI until the business model is proven.

 In closing…

There are many practical and commercial considerations from this blog series about when start ups look at determining funding requirements and capital raising approaches. Most importantly from our perspective we can provide experience in how to utilise this funding once secured with a solid sales & marketing go to market plan and leadership from several years within the tech sector and working with business owners to drive growth.

Feel free to contact us for an initial discussion on how we can help you and your business, from start-up to growth mode, at info@alchemiseconsulting.com or @alchemise_cons or call our office on +61392255022.

Software start-up businesses: Capital raising and ROI

What prompted me to write this article is that this year alone, we have been approached by many aspiring small entrepreneurial first time start-up founders in Australia with a great vision to be the next star tech multi millionaire with a great idea and concept for app development. From a Go to Market and feasibility perspective, much more time and conscious planning of a sales and marketing plan could be developed first and knowing your target market with a strong customer value proposition. The financial elements of your sales revenue and profit model particularly with Software as a Service or subscription models to scale in say two sided marketplaces need to be considered for B2B and B2C applications.

Read about a selection of our business owners examples we have spoken to below in hospitality, retail, legal services, trades, telecoms.

Typically they have worked in the technology field, banking or finance, hospitality or trades sectors, and have clearly seen a need for doing things differently or something which has frustrated them as an end user in this digital era.

So why not build a mobile app?  We have seen successful apps like Tinder for dating, Uber for car ride sharing, and many other disruptive business opportunities and approaches.

There has been more Australian success stories such as Canva and Atlassian and well as  Australian based start-ups of recent time, however a reality check highlights many failures also in small business that may not be highlighted with their challenges and how to overcome them.

What concerned me in talking to these business owners in early stage development, many of which who have continued working their day job, or those who have 100% committed to this idea and own self-funded capital, is that many have started building their business without many key elements that any start-up business should consider from a financial and commercial perspective.

In this customer centric and experience environment, it really surprising me why many aspiring app designers start with features and functions first before understanding who their customer is and if this is a commercial need to solve their challenge and if there is in fact a business case for their development.

The maturity of having some commercial acumen or seeking advice as an investment is an important first step. Some basic checklists should be considered first before expending any self-funded cash or investment capital cost.

Two important factors are cashflow and cashburn when you have limited funding to kick start your business. Whether it’s your own capital, crowdsourced, private or public funding sources, ROI and accelerated sales growth is needed in terms of new customers, actual revenue streams and cashflow considerations.  

We typically recommend a Digital Readiness Assessment or a Business Growth Assessment to help gain an understanding of the start-up business objectives and maturity before entering into the detail design or functional building blocks. Read our previous blog on 3 key elements on how a Digital Readiness Assessment can help clarify the right plan for you.


Some start-up and new venture scenarios we have heard from this year: 

Owner A: Hospitality Application

The two owners had come from a hospitality background and they wanted to build an app which allows restaurants and cafes to match and fill empty tables during both days and evenings, with a fee charged based on percentage of spend to onboard the vendor. Despite sharing the market with Deliveroo, Foodora and Uber Eats, they claimed their model was different. 

software start-up hospitality

The app had been built and tested already, and they wanted to focus on building the B2B marketplace to onboard customers and launch in Europe and Australia. The challenge was both marketing and sales to onboard an initial 200 customers.

It seemed to me that they had taken a back to front approach, by building the application first, before assessing if there is a valid market opportunity and developing the app to suit the market.

Upon an initial consultation, it was apparent that bootstrapping this application development cost resulted in missing key plans on the commercial go-to-market front, including:

  • Marketing and sales market analysis for each country
  • Profit and revenue model as a subscription model
  • Business strategy – how to scale and sell directly or via a referral/distribution model.

We presented an offer to look at developing their GTM strategy, however this wasn’t in their current budget as most of the funding was invested in the application development side, and therefore they could not proceed at the time.


Owner B: Industrial Equipment Hiring Application

Four business partners, all highly educated and ex-engineers, had built a two-sided marketplace B2B app to rent industrial equipment from vendors who had availability, and their platform facilitates a self-service rental catalogue listing and booking engine to connect vendor and renter.

Originally they came to us with an interest in digital marketing assistance, and upon looking at their website and type of content present, it wasn’t sufficient to take a customer centric approach as information about their target market or ability to collect customer data was unclear.

We questioned whether their pilot stage app had been tested, but they were looking to raise more private investor capital. We asked to see their pitch deck and hear about their sales and marketing plan. While there was an initial interest to engage independently first to help with their pitch deck, the subsequent response was to wait until they had raised the funds, then they can consider a marketing and digital initiative to get this off the ground.

An offer to develop a basic marketing high level strategy to include in their investment pitch deck was declined to help them secure the funding and demonstrate forward planning.

I asked how confident they felt about raising private capital and what approach they planned to take, and received a response which was unsure…


Owner C: Market Food Truck Application

A business owner saw the opportunity to setup a market food truck/vendor and customer app.

An initial consultation garnered interest from the venue event organiser. Capital was limited to build the app (to test stage) using an offshore web development team, and this was the first step to customise the app to get one initial customer to fund it.

After six months, I reconnected with the business owner and learned that due to the GDPR and tightening in data privacy using SSO with Facebook login accounts, the application development project couldn’t proceed due to many backend development changes and cost, and also the business partner had a change of course with his view.

The commercial and sales qualification of the initial opportunity with the market hadn’t been sufficiently completed firstly.

The actual go-to-market approach hadn’t been thought about because the functional design was launched first to solve an immediate idea of the perceived problem which wasn’t verified.


Owner D:  Billing Software Cloud SaaS Platform Application

A serial entrepreneur in the ANZ region has built and sold multiple tech start-up businesses previously. The latest venture has involved raising some capital funding directly at the US market and hiring a first team for technical and initial sales/SDR resource. software start-up technology

We proposed a go to market strategy engagement and market feasibility study for the Australian market, with our own network of consultant contacts and opportunities to explore.

When capital is raised from angel investors the drive is to achieve value for shareholders. The dependency is on cashflow for engaging this project, however a scattergun approach without an integrated strategy isn’t assisting to drive traction and capitalise on opportunities here in Australia.  The initial capital raised required a success model based on penetrating into the US market first.

The SaaS profit model for Telco/ISP and utilities as a pure play solution needs to consider the actually profitability and market positioning as part of a GTM targeted approach.

Overall in analysing the SaaS revenue model, I could see there being some challenges in their fixed percentage of revenue subscription model to be profitable.

Over 12 months later, since the initial conversation, the company is looking to raise another round of funding to sustain their current operations for traction developed in the US but not for Australia yet in a structured approach. It has been more of an ad hoc approach without investment in a solid business strategy and focus on ROI outside of their focus on the US market and shareholder expectations.


Owner E:  Legal Software Application

A prominent lawyer in Melbourne spent over $250K to build an online legal practice platform software over three years, to turn and sell off the IP and foundation.

His intention was for the purchaser to take it to market and commercialise it, with some software licence and maintenance projections to sell globally to be  compliant for all jurisdictions.

The request was for me to assist in pitching and presenting to HK prospective buyers but the founder had no sales experience.

The review of the business case and financial projections are only hypothetical with no real paying customers yet only a couple of small legal beta trial instances. There were some challenges I could see with this in developing a sustainable revenue model and especially the market feasibility with most of the software market moving to a SaaS – Software as a Service Cloud model.


Summary of challenges and considerations to make:

Mobile application developers – two-sided marketplace challenges

The cost of building an app warrants some business planning around the application first and customer profiling around usability and customer experience and processes for two-sided marketplaces.

How do you market to onboard users from both sides of the app?

What dependencies are on your third party open source apps like using Facebook or Google to login or sign up? With policy changes around data privacy for third party login and user data sharing, how does this impact on your business model if a few things change both on B2B vendor or end user side?

How do you attract loyalty digitally from not just initial sign up but actual subscriber usage of your app and continued feedback from customers with marketing and support channels?

Tip: Determine your ideal customer profile for each marketplace supplier/customer, whether it’s B2B or B2C.

software start-up customers

Part Two of this blog series contains practical guidance and tips around start-up capital raising, and what to do with the funds to achieve a solid ROI both for your business and investors.

Feel free to contact us for an initial discussion on how we can help you and your business, from start-up to growth mode, at info@alchemiseconsulting.com or @alchemise_cons or call our office on +61392255022.

Silence: Your sales prospecting and lead generation challenges

Did you know there has been a room that has been created that is so quiet that you can hear your own heartbeat, an anechoic chamber at Orfield Laboratories in Minnesota. The longest a person can tolerate being in this room is approximately 45 minutes – apparently, the silence is too much to bare.

So how long can your sales team looking for new business sustain from silence from their prospective clients?

This is an issue that is happening across many industry sectors. Many businesses have been relying on purchased contact lists of email addresses and phone numbers. They have found that from the 1990s through until about 2015 that they have been able to rely on the profits generated from these lists from cold calls and email blasts, with little push back from the people that they are drowning in their torrent of unsolicited communications.

State of Inbound 2018 - prospecting has gotten harderSource: State of Inbound 2018 

This approach no longer works and sales have become more difficult today compared with 2-3 years ago. Salespeople are finding that their email and voicemails are resulting in silence from the prospects that they are trying to reach, with 40% of people surveyed having no response from prospects. Engaging multiple decision makers in the buying process is also more challenging as key stake holders have other priorities. Thus, the interest is lacking in what the salesperson is putting forward.

Technology has now advanced to the point where emails are being blocked and phone calls are being screened.

In Singapore it is now standard practice across sectors for all client facing staff to be instructed to not confirm email addresses, not supply alternative contact numbers to reach departments where the prospective person may reside and instead supply an email address that will have little to no chance of making it to the end target contact. This is because if the person is interested in solving a problem, they will perform their own searches.

Revenue growth is still driven by existing business, but new business is an area of challenge. Business owners are blaming sales managers; sales staff are moving on looking for greener pastures or being released from the business.

With the top 4 areas that sales staff and business owners are finding it harder today being

  • Getting a response from prospects, this being via email or phone
  • Connecting with prospects on the phone
  • Getting stake holders to meetings, and
  • Closing deals

It is clear that a better strategy and overall sales approach is needed.

State of Inbound 2018 - generating traffic is a constant challengeSource: State of Inbound 2018 

This comes back to old school approaches with using a strategy (also known as a plan) instead of tactics (individual actions). Many business owners have engaged with creative agencies putting forward new pages and guaranteeing a certain number of visits to their customer’s site. Business owners are still finding that after significant investment that their ROI is lacking or non-existent.

A commercial focus is required when looking at your marketing activities and a maturity as a business owner is needed to recognise that creative agencies have not taken ownership of the customer engagement process. Attract and nurture prospects with engagement is not with in creative agencies skill sets as they lack the industry experience of their customers vertical to understand their customers end client’s pain.

As a result of this gap the void is filled with silence. Have you had enough of the SILENCE?
SM video_play_firstslide

If this blog, or the challenges highlighted by our new video resonate with you, contact us today for an initial discussion on how we can help you and your business overcome these challenges, at info@alchemiseconsulting.com or @alchemise_cons or call our office on +61392255022.

How live chat accelerated a new inbound sales lead

Overview – Why do you need to have Live Chat?

The importance of Digital customer service led sales and marketing channels offering LIVE CHAT on your business website is NOT OPTIONAL anymore with B2B and B2C engagement. With the progression of customer service automation to ChatBots, AI and Live Chat engines, you don’t know where and when your next inbound prospective sales opportunity might come from – so BE PREPARED to have the capability to be responsive 24 x 7 or be available to engage without delay or you will miss out on new business enquiry for your pipeline!

The Initial Customer Journey “Live Chat” User Case – National IT Services Business

A leading national IT services business needed some assistance to develop their Inside Sales Team process and growth.  The General Manager made an enquiry as a new lead through our website using live chat options as the communication channel of preference.

The customer buying process identified is summarised below and as a result of investment in building a content and contextual driven strategy once the target customer profile was development and understood:

1) There was a need for assistance to see who could help in the local marketplace.

2) Google keyword search performed 

  • How to build Inside Sales teams
  • How to develop Inside Sales processes

3) One of Alchemise Consulting’s blog came up in the results organically SEO ranked on the first page.

https://alchemiseconsulting.com/how-inside-sales-drives-lead-generation/

4) The initial enquiry was made from our Hubspot Conversations website chat room 

live-chat-alchemise-consulting

5) Our Alchemise Inside Sales Consultant was notified of this in real time and was able to respond from his mobile application within one minute to respond to the request and then switch channels to convert the lead to a phone based outbound call within five minutes.

6) After an initial marketing qualified lead (MQL) discovery discussion opportunity was identified, this was converted to a sales qualified lead (SQL) with a meeting set that same week with the key stakeholders/decision makers.

7) Following the initial prospective client meeting a proposal was delivered within the same week with a solution.

As you can see from the example the acceleration from top of funnel to bottom of funnel within a one week timeline was due to a two minute response time from being found on Google Search from organic SEO for an evergreen content piece, the live chat lead was developed from initial customer service to sales engagement and new well qualified opportunity for the sales pipeline.

Our solution

We have been running Salesforce CRM and HubSpot marketing automation with a Live Chat (Hubspot Conversations feature) on our homepage to allow us to capture and qualify any real leads quickly. It has a round robin team feature for any defined “customer agent” to pick up live and be notified automatically that a new web enquiry has come in within message inbox.

From a customer experience and journey mapping exercise, we choose to offer our prospective customers the options for phone, email, contact us or live chat. This was not enabled as just a pre-scripted AI programmed chat bot which allows us to deepen each live chat engagement initially.

Outcomes

As part of the shift to a 360 degree flywheel approach by HubSpot, this was not just a two-dimensional traditional marketing to sales funnel, our distinct customer centric approach allowed us to: 

  1. Add value to this new prospect
  2. Respond quickly to their timelines
  3. Position our value proposition in person with a meeting with the two key stakeholders/project sponsors
  4. Lead with a proposal ahead of the two other competitors within a week

Subject to the budgeting cycle and project priorities we have quickly used inbound digital channels from content marketing to a sales qualified engagement to accelerate our sales process with this leading national IT services prospect.

Key takeaways & learnings

What I wanted to highlight is a textbook example of how the investment in sales enablement, CRM/marketing automation platform, customer experience and live chat channels can help sales team accelerate their sales process to reduce the ‘friction’ for customers to engage with us.

The lead response time enabled us to convert the warm lead within one minute response time instead of a 24 to 48 hour telephone call back response time from sales allowed us to shorten the sales funnel cycle from MQL to SQL.

Using a marketing automation tool like HubSpot allowed us to monitor, log and respond to our potential customer quickly and at the right time.

The role of the Inside Sales Representative or Sales Development Representative today needs to also be multi-skilled with digital omni-channel customer service support skills and experience to handle inbound and outbound customer interaction dynamically.

The role of the traditional telemarketer based on cold calling is at risk and needs to diversify skillsets into social and digital sales whilst having the ability to be customer centric. Most importantly it’s understanding how to really build trust and off value to your prospective clients during outbound and inbound multichannel interactions ( up to the prospect’s choice of communication channel).

We talk about bridging the gap between sales and marketing and this experience shared shows how easily the digital channel of experience can provide immediate ROI.

A traditional example in contrast which DOESN’T WORK for customer engagement today

How this unified communications/contact centre services company just missed out on a new genuine lead enquiries and needs to digitally transform their sales & marketing approach.

It is most ironic that this well established Australian service provider sells contact centre and unified communication solutions but do they really practice what they preach?

In just having two communication channels on their website – contact us for the Melbourne office with a 1300 or local direct dial number.

live-chat-inbound

Upon calling their office three times over a two hour period, and pressing every option on their IVR systems:

1 – for Customer Support
2 – for Sales
3 – for Accounts
4 – for Reception

The common response was SILENCE; each channel option rang out or was put onto a dial forward to the next department but no voicemail or diversion to a real person.

As more and more companies choose to reduce cost with reception or a front office what will happen with this silence which makes it challenge for genuine enquiries to get through on the phone or someone to assist. It seems like the reachability in this digital age is becoming less focused on customer service with a reduction of communication channel choices to cater for broad demographic access. 

Look out for our upcoming blog around “The impact of silence”

For a new customer lead enquiry this wasn’t a promising start, especially when I was trying to reach the Sales Director. When I eventually reached him, I asked if he was aware of this inbound challenge to get through to someone either in Sydney or Melbourne office and how many more new sales leads he might have missed! What a shame it would be if it was the next $1M deal that another competitor won from their lack of availability to be contacted from an inbound call.

To find out more how you to can stop a leaky funnel effect or not miss out on valuable new inbound leads with LIVE CHAT, please contact us for a confidential discussion and we can review your requirements first to assist.

If you would like another example of how inbound marketing automation helped us close a new client deal in just 10 days – please click here for our blog. 

4 tips for sales commission in services businesses

How do I pay sales commission to sales representatives in a services business?

 

Did you miss our case study from when we assisted a full service marketing agency to set the right sales compensation plan for their first Sales BDM hire

The right sales commission plan is critical to your first and subsequent hires, particularly within a new or growing business. Some of the considerations and challenges raised in this blog are particularly relevant to business owners or directors who have come from a non sales background who might be unsure where to start.

Some practical tips for structuring sales commission and planning: 


1) Preparation and planning

  • Consider the line of business you are in and what the market rates are for your industry sector.
  • Talk to some of your industry peers about their experiences.
  • Do your research with some benchmark insights or recruitment reports.

2) Sales budget on FTE (Full Time Employment)

  • Know your financial figures first in terms of your operational and fixed overhead costs, average profit margins and revenue goals.
  • How long are your average sales cycles per service? This determines how your sales pipeline can be developed to reach your monthly required targets based on speed and size.
  • Do you know your cost of sale and what type of sale you are making – invoice upon delivery or on purchase order?
  • Have you calculated your sales revenue targets and established what is realistically achievable?

3) Individual role requirements

  • Do you receive payment on invoice or signing of a contract upfront?
  • Do you need to consider any client KPIs or credits?
  • Are you paying the commission coming out of the client pricing profit margin or from a revenue target?
  • Different structures are appropriate for different businesses and the type of services and products you are selling.
  • Is your sales hire going to be responsible for acquisition or retention business and accounts?

4) Commission considerations 

  • Is it a flat fee percentage uncapped?
  • Do you have a staged payment plan or bonus plan for the team?
  • Have you considered if a contract is cancelled or mis-sold what happens to the commission component?
  • Is there a sliding scale achievement plan based on monthly quotas and for overachievement?
  • Is there a team component to incentivise and motivate team performance around ongoing account engagement or retaining high value accounts?
  • If you are to set a foundation standard, ensure that this will be consistent with how you pay different sales people in the future.
  • Consider how to continuously keep the sales people motivated – what happens if they overachieve or underachieve depending on your sales cycle?sales-commission

Sales commission and planning – what next?


Often smaller or growing services businesses don’t have a structured sales plan, rather the sales responsibilities may be shared between the team.

There is a correlation that sales performance and behaviour is determined by the sales plan and culture created by an organisation. Leadership from the business owner or sales manager needs to develop this.

Sometimes a multi level sales compensation plan is required to guide the sales person to sell the right services, i.e. higher profit managed or retainer services versus a product based transactional model.

sales-commission-planning

If you pay commission on annual or monthly revenue targets without any breakdown then this can lead to account issues and a disincentive to cross sell and upsell with existing or new clients for the year to maximize the revenue opportunity. 

From my experience, the delicate balance of designing a sales compensation plan to support one individual may also need to consider other sales team members, either existing or future hires. The role of the sales leader and business owner here is to develop the right sales strategies and financial budgets and targets, aligned to the sales objectives. 

I don’t have, or recommend, a one size fits all sales compensation model for the purpose of this article, however I can provide some scenarios to different business models – but it’s advised to arrange a consultation and customised solution and approach as required designed to specifically to suit your sales objectives and needs.

If you haven’t come from a sales background or a business owner, this might need more elaboration…. Do I pay a base and commission split of 50 base:50 commission, 60:40 or 70:30 split, or do I consider a shared risk 40:60 (60% at risk component)? Perhaps a guaranteed commission structure or a bonus might be more appropriate.

Look out for our next article around sales commission and compensation examples and scenarios which also apply to you, “How do I pay sales people for acquisition sales or retention sales? 

In the meantime, if you are starting out building your sales team or first sales hire, please reach out to us for assistance or advice in making the right choices at info@alchemiseconsulting.com or @alchemise_cons or call our office on +61392255022 – or click below for a consultation on everything sales, including sales performance and compensation structure! 

 

Case study: What sales commission do I pay my new sales BDM hire?


The right sales compensation plan is critical to your first hire with a new or growing business. Some of the considerations and challenges raised in this example are particularly relevant to business owners or directors who have come from a non sales background who might be unsure where to start.

Overview

A fast growing leading Melbourne full service marketing agency was recently looking to hire their first salesperson to join their successful team, and  shift their focus for active sales growth.

Prior to this new sales focus, sales activity was led by one of the Directors and other sales responsibilities were shared between the Digital Strategist and the Project Management team.

To some extent this hindered their ability to service existing clients and also build a new business funnel with a targeted focus for growth. In earlier days, this marketing agency has historically had more transactional business  and strong referral leads  than focusing on generating ongoing retainer engagements and developing new business sales capability.

Growing a sales team: Making your first sales hire

The marketing agency had decided, after an initial interview and shortlisting process, to hire a Senior Business Development Manager with general market rates and to provide an offer. 

The initial challenge was how to pay them a suitable commission package in line with the direction of agency’s services and business growth plans.

Initially a flat fixed percentage plan was discuss on a high base salary. However, management were initially unaware of the many factors that needed to be considered in sales performance management. A clear aim wasto actively grow the number of new sales opportunities and through certain preferred service lines.

4 sales compensation considerations


This agency is in the process of shifting to a higher value retainer model from transactional project based or time based work. This needs to be considered in how sales plans and commission structure are determined and set.

  • Sales goals for the financial year sales-compensation
  • Services priority – retainer-based, projects and renewals
  • Cashflow and encouragement of team based culture
  • Not having an open ended commission plan initially, until aligned with business and financial objectives.

Proposed client solution.


The agency’s initial view was to offer a flat rate percentage commission.
 

Upon review and with additional market insights, that suggestion didn’t quite make sense given the focus of revenue and profit required in the business to make this successful for both short term with the sales person, and also for establishing a foundation for business growth. The other consideration was to create the ability to scale the sales team in the future beyond Year 1. 

Considerations

When you are looking at sales compensation structures you need to look at the sales function of either retention focus (account management) or acquisition focus (business development) as both of these have an intrinsic mode of sales behaviour and associated type of sales approach.

From a sales structure typically the behaviour of your sales team is based on the incentive you set them. If you are a products or transactional business then sometime this top heavy loading on revenue on order might work from metrics focused on volume and size of revenue.

sales-hire-compensation-balanceIn the professional services area, this principle doesn’t apply and a delicate balance needs to be achieved between blending in gross profit margins for healthy financial considerations, a realistic and achievable individual target (particularly for a growth focused SMB/SME), the balance of acquisition and delivery capabilities, and the consideration of which types of services are best placed to sell during the customer buying lifecycle.

Different compensation plans need to be considered for acquisition mode sales and also retention sales plans, or perhaps a hybrid if the sales resource is responsible for both.

Being a full service marketing agency, most of the business’ client work is project based, and in recognising this, there was a discussion about the risk of setting targets too low – if the Senior BDM were to overachieve easily based on revenue early in the year, then there is always a risk that little motivation and monetary incentive exist for the remainder of the year. This can greatly degrade the productivity of the sales function if rewards for consistent performance aren’t put into place.

Our Sales ROI review highlighted that by aligning the sales strategy, a split commission element needed to be put into place, based on the expected contract renewals focus whilst helping the project team with securing the additional business, cross selling and up-selling.

Aligning the sales targets in line with a tightly linked compensation plan needed to be formulated realistically with the considerations in mind.

We provided some sales based guidance around reverse engineering their sales revenue target and direction of sales and marketing activity required to hit their sales goals for the next financial year.

Improve Your Performance Concept in Flat Design with Long Shadows.

The process of determining a break-even ROI on a sales hire is important as they will typically (depending on the industry) generate about three times the sales pipeline value of their individual sales target.

The challenge of ramp-up time and a comprehensive onboarding process is often not considered, with unrealistic expectations on the sales representative to successfully close business within their first month to justify their hire.

We provided a compensation calculation based on the right behaviour in line with the suite of services to be sold based on setting the right targets and appropriate commission elements to suit the individual’s needs and agency’s business focus.

Recommendations and Outcome

After sending through a compiled market survey from leading recruitment reports to validate market rates, the appropriate sales commission plan needed to be structured correctly and fairly to meet short term and longer term sales goals and a foundation which can scale. 

For sales representatives, typically a base salary component and a OTE (On Target Earnings) is provided based on their sales target.

For Year 1 there was more importance on setting up the foundation, then progressing to Year 2 when the commission plan could be reviewed based on performance in Year 1.

After consideration and analysis of the business’ services and financial plan, our proposed plan consisted of:

sales-hire-next-steps-plan

A commission plan tied into three elements:

  • Revenue for all project and services (Total Contract Value)
  • Retainer Profit (Gross Profit)
  • Team component for new business renewal and contribution (End of FY Team Bonus)

This equals the Year 1 target to hit their new business sales goal.

The structure for Year 2 can be negotiated depending on initial performance and tracking of realistic achievements, as well as a review from Year 1 to determine the success or challenges faced with this method. 

Key takeaways and summary

For SMEs unfamiliar with how to compensate experienced sales people, I would suggest to not just think or assume that the simple plan or flat rate or % commission is sufficient, particularly in small business where cashflow is tight and profit margins are slim. You need to know your market and territory to assign as well as which market segment you are trying to sell into.

If you aren’t diligent in this approach to paying to a sales commission plan and target setting, whether it’s a junior or senior hire, you could risk exposure to overpaying your individual sales resource. A secondary effect is further reducing profit margins to keep them sufficiently motivated if they can achieve their sales target too quickly and easily. 

In highlighting this, it is critical to understand where you are paying commissions from, are this cost built into your service contract and deal, or overall based on your gross profit margins.  Your ability to scale and grow your sales teams requires some analysis on where your ROI can be generated from.

You need to know your business figures thoroughly, such as individual overheads and sunk costs, and impacts on GST and superannuation payments. Fundamentally you need to know your financial forecast of revenue and profit margins first to determine whether you can onboard the right investment in sales headcount and budget to start with. 

The other tip is to ensure that you mutually review the goals regularly and separate commission plans with performance reviews to ensure your growth plans are in line with business needs.

As you grow the sales function within your team and business, building that consistent foundation is recommended with the right sales performance advisor until you are ready to hire a sales manager. Consider the temporary impact of sales resource turnover or ongoing challenges to grow future sales hires.


For more information or an obligation free consultation or guidance please contact us at info@alchemiseconsulting.com or call our office +613 9225 5022.