Today’s environment has created challenges for all marketing organizations.  First, the economy is probably having a negative impact on your business, which is being reflected in your marketing budget, personnel and flexibility. All of this with increasing requests to generate additional leads (sales). The other challenge is keeping up with and utilizing appropriate new technologies that are emerging daily.

So the real question is not what do I do with fewer marketing dollars (no-one wants to hear this), BUT how to optimize your current resources (dollars and people) to generate additional revenues, all while staying within budget.

There are several ways to attack this challenge. 

• One method is to run a marketing campaign with a specific mix for a period of time (several months or more) and then analyze your results at the end of the specific time frame.  The good news is that you did run a marketing campaign, but the potentially bad news is that if the mix was incorrect, you not only wasted precious time but you have also spent or wasted a portion of your marketing budget.

• Another method is to run two campaigns with different marketing mixes simultaneously and analyze the results as in method number one. The good news here is that you might have gotten some positive results because the two campaigns probably covered a larger “audience”. Unfortunately if neither campaign met their objectives the time lost is huge AND the marketing dollars lost could cripple your remaining activities.

• A third method is to just do the same as you have been doing before.  Given the current economic environment, this approach will definitely be the worst choice as the economy has changed buying habits drastically and the new ways in which your potential clients are gathering information to make decisions.

• A fourth choice is to model your current marketing activities  along with  your goals and objectives, research all the best practices in your similar industries for marketing, create different business modules for the numerous distribution  methods and then integrate all this together and run it against your desired results.   The upside potential is that your might optimize your marketing mix.  More than likely you will have various “errors” in your model and thus end up with less than desirable results. Plus this takes considerable time and resources during which nothing is “happening”.

An alternative approach is to utilize Fire Alarm Marketing’s Marketing Resource Optimizer™ (MRO).  The benefits of our model are; (1) the best practices have been already researched, (2) the various marketing activities have been tested over many years and (3), the newer marketing technologies have been incorporated into the model.

The choice is yours on how to optimize your marketing mix.  Whatever method you pursue, start “optimizing “now before it is too late!

If you would like more details about our model, give us a call (508-643-0411) or contact US

RHL 10/12/10

Now I realize that 800 numbers (one channel into a contact center) is a cost effective way to handle customer’s requests, but let’s put some logic into the script that these companies are providing.

Here are some actual 800 number responses that I have encountered.

 Hi, for account balance, press one, for payments press two, for loans press three, for change of address, press four.  Well, I wanted to dispute a transaction.  So like everyone else I pressed ZERO, and here is what I got; to replay the messages press 5, to talk to a customer representative press 6.  You got it, I press 6 and I get,   to hear an account balance press one……

This is a great one, Hi, welcome to XXX Company, please key in your account number, (well I am traveling and I have a paperless account, so I don’t know the account), so I key in 00000,  reply that account number is not valid, try again,  after several tries, I get, we will connect  you to a customer representative;  ring, ring, ring,  to talk to a customer rep, please key in your account number,  key in 0000, that number is not valid, after several tries,  thank you for calling XXX Company, good bye!

Does anyone at these companies think about why customers might be calling and have a script that addresses these issues OR at least one response that will take them to a customer representative?

Some things to consider about 800 numbers and the contact center software.

First, the software is as only good as the scripting that is developed for each type of business.  Therefore, companies need to understand what they will be offering and what will be the likely reactions. Make sure that the scripts do not have closed loops in them and after a customer tries the same pattern X number of times, there should be some trigger that takes them to a real person.

Second, I think companies should reevaluate the cost savings of automated answering systems versus a real living person answering the phone.  Depending on your type of business, it might be far better for customer relations as well as cost effective to have an agent at the other end.  If goodwill is your main asset, then real live people should be on the answering end of the phone.  If you have very basic and limited “transaction” then an automated system will probably be well suited for your company.

Third, if companies are going to use voice inputs versus number selections, then they better have specific examples for guidance; If not you will run the risk of further irritating your customers.

Fourth, while I realize security is a big issue, companies need to understand that not everyone has memorized their account handle, their passwords, their PINS, their favorite color, their first grade teacher.   And to make matters worse, these vary depending if you are calling about your web account versus your billing account versus your bank card.   If a person doesn’t have the information needed, live secure solutions exist.

Fifth, Outsourcing contact centers and agents was a big thing a couple of years ago, now the trend seems to be reversing.  Seems like quality and customer satisfaction were taking a hit.

Given these issues, if one considers that customer satisfaction is becoming the key differentiator for some companies and their competition, then they should definitely consider evaluating those parts of their automated system that cause customer dissatisfaction and if necessary consider increasing the number of customer representatives.

I have a suggestion on how to improve automated systems.  It goes something like this:  1-800 Insane, Hi thanks for calling YYY Company.  Press one for account balance, press two if you want to go around in circles for 20 minutes, press three if you want to go around in circles for 30 minutes, if you want to speak to the president, enter the square root of 35.7B,   goodbye. 

OR re-evaluate your contact center and agent strategy.   I would prefer the later approach!

RHL 9/21/10

Before I answer the question, let’s look at what functions each perform and then draw a conclusion.

Assuming your enterprise has a direct sales force, it performs many functions such as; relationships, promoting your company, finding customers, closing orders, etc. An additional function that is performed by sales people is creating a personalized awareness with their customers.  Two major issues a sales team cannot do effectively is create wide-spread awareness and be the most cost effective.

Advertising can be used for different objectives. The primary objectives of advertising are creating awareness, branding, and providing information about your company and /or products.  It has been proven that advertising increases sales efficiency by providing awareness or helping turn a cold call into a warm sales call.  On the other side of the equation, advertising is not a substitute for personal selling or creating product preference.  These require a sales person to be “real time” and demonstrate or explain the value propositions to a potential customer.

So which is best?  The answer is not which channel is the best but that advertising and personal selling support each other and thus, picking the correct mix and integrating from a marketing communication strategy is really the key.  Of course the mix will contain more than just personal selling and advertising but other marketing tools as well.  The real challenge is developing a complete marketing plan that maximizes the  communication tools, supports the overall goals and falls within the marketing budget.

So the keys are: 

-Develop an overall marketing strategy and implementation plan

-Structure the mix to include your sales team

-Make sure things like messaging and value propositions are in sync between advertising and the sales force.

-Establish the budget that supports the overall game plan

RHL 7/27/10

A guest post from Bob McKee.

Dick has posted about the Pros and Cons of Direct, Indirect, and On-line sales channels here, here and here.  Bob McKee talked to us about selling to the Government; asking why hadn’t that been included.  This is a good question and we asked Bob to share his thoughts and experiences.

Federal Government Sales – Right for Your Company?

Federal government agencies spend over $500 Billion through open contracts awarded by the General Services Administration.  About $200 billion of that total is earmarked for businesses with fewer than 500 employees.  GSA contracts cover almost every type of non-perishable product or service, but the contracts work better for some types of companies than others.

For example, contracts tend to be for finished products rather than for components.  They also work best for companies that have a sales force or a dealer network.  The contract is a license to hunt; it doesn’t put the deer in your pickup.  Sales people have to develop relationships, just like with regular customers.  Another issue is that price changes are usually limited, which may not be attractive to companies with volatile costs.

There are surprisingly few companies on contract in most product categories.  You can see which competitors have contracts by going to www.gsaelibrary.gsa.gov , finding your product and clicking on the Category Number.  This will link to a list of the companies that have contracts.  I selected “air compressors” at random and found that there are only 13 contractors, of which half are distributors.

The small number of companies is a good reason to get on contract.  So why haven’t more companies done it?  Naturally, there are some good reasons.

1.  Place of Manufacture.  All products must be made in countries with which the United States has trade agreements.             These include North America, and many European, Caribbean Basin, African and Asian nations.  But it leaves out                         some big Asian manufacturing countries, most notably China.

2.  AbilityOne, a government agency that assists participation of handicapped Americans in industry, lists several                      thousand products, mainly commodities.  If your product is essentially the same as something they offer, either become              associated with AbilityOne or forget Federal sales.

3.  Paperwork. Contracts are lengthy, difficult to follow, and full of requirements that are incorporated by hard-to-find               references.  A contract response package runs 200 – 300 pages with requirements that involve several agencies.                           Companies usually estimate that it took 9 – 12 months to put their packages together.

4. The Review Process. Although the GSA wants to attract more companies, their review is directed by bureaucratic             rules unlike anything in civilian business.  Everything in the contract response has to conform exactly with the                                 sometimes unclear requirements of the Solicitation or the entire proposal is disqualified.  The contracting officers will                   explain whathas to be changed, then the entire proposal has to be resubmitted.

On a recent proposal, a contracting officer emailed to ask why I listed some floor mats under a small business set aside, but not others.  He stressed that he was not challenging me, but as a new group member he wanted to understand the distinction.  I responded that it was based on the type of material and cited the contract reference.  The proposal was subsequently rejected for not including a list of the very products he had asked about. I resubmitted exactly the same files and the proposal sailed through.

For all the reasons listed above, an industry has sprung up to help companies prepare their contract proposals.  For many companies the cost of these services is more than covered by their first sale.

Going back to the positives of government contracts:

1. This is a large market with limited competition.  Many companies increase their market potential by 10 -15%.
2. Once you are in the door, you can also sell products that are not on contract.  These are called open market sales.  For example, suppose a product is not on contract because of a conflict with AbilityOne offerings.  AbilityOne only guarantees 45 day delivery on most products.  If the contracting officer needs the product sooner, he is allowed to buy it on the open market.  That happens a lot.
3. The market is practically recession proof.  In fact, some sectors are awash in money right now.
4. There are no slow pays.  The government pays every invoice in 30 days or less.
5. Contracts run for 5 years, with 5 year extensions.  So the effort of getting on contract is rewarded by 10 to 20 years of opportunities.

Bob is a principal at Resolute Marketing, which helps companies submit contract proposals a fraction of the time normally required.  Contact him at resolutemarketing@verizon.net or (508) 361-5626.

© Robert L. McKee 2010

3/19/2010

 Five major direct marketing misconceptions:

 1-      Given today’s technologies, direct marketing is the only way to go and it is the least costly. Well, technology is changing the way we do things, but technology alone is not always the key driver for change. Remember that your potential customers are humans and thus they vary on how they “gather” information and interact with technology. Secondly, some products and services are not very well oriented towards today’s technology. As for cost,  the “web 2.0” process is far from free; take a complete look at the cost to do direct marketing. In some cases you may have to add resources to manage the multiple divergent activities.

 2-      Everyone has email, so I can send our emails and the orders will start coming in.  This plan of action may be in violation of the CANSPAM act, and may alienate potential customers.  Just like traditional telemarketing, one needs a compelling offer, an approved targeted list, a call to action, and supporting activities such as case studies, blogging for creditability, and must importantly a well thought out email program, because one mailing alone will not cause potential customers to react.

 3-      Social marketing has no proven results, so I do not need too use any of these new tools! Understand that the vendor to consumer model has changed. The consumer is in the driver seat and consumers can and are talking about enterprises and about enterprises’ products and services. So as a minimum, one should at a minimum, monitor what is being said so you can react. Secondly, many end users are using media tools like blogs, twitter postings and Facebook to become informed before they make a decision, so it stands to reason that if they don’t see anything about your services or products, you will not be considered.

 4-      Hard copy (print) mailings are no longer used because they are not effective. Again, it is not a question of what to use, but your mix.  Hard mailings are and can be very effective.  A good example is a mailing to “new” customers, those who may not know about you. Hard mailings add personalization and get around potential filtering by the corporate IT email structure.  Hard mailings can also precede or follow up as part of planned social media programs.

 5-      The web site is nice to have but once I get it launched I can focus on other marketing programs. As I noted in item number three, the consumer is in control. Their major source of information is the internet, starting with your web site. If your web site is not user friendly, up to-date, contains real information and provides “give a ways” such as papers, case studies, white papers; and then you have just lost another potential customer.

 In summary, as I have always stated, look at your strategy and goals and see how direct marketing as a sales channel will support them.  In reality, your sales model will probably be a mix.  So the real question is how much direct marketing and what percentages of its components will be used. Also like other marketing programs, know your audience and know what they are thinking and saying about you.

 Do you know how your web site compares to your competition?

 RHL 01/19/10

 Five major indirect channel misconceptions:

 1-      Partners, resellers, etc. are all alike. Nothing could be further from the truth! The major impression is that most indirect channels carry vendor’s products, do some form of telemarketing and just take orders. In reality resellers come in thousands of kinds and types.  From pure distributors, to value added resellers, to system integrators.  Many resellers not only know the products and/or services better then the vendor; they usually have very knowledgeable sales people with solid long-lasting relationships with their customers.

 2-      The indirect channel is only interested in pricing for products and /or services. While everyone is in business to make a profit; the indirect channel is equally interested in areas such as marketing programs, territory alignment, training, technical support and LEADS!  And like all good businessmen, they recognize the positive nature of continuing relationships with key customers.

 3-      Your channel programs can be applied to all resellers/partners equally.  If you believe this then you are in for some very rough times with your resellers. Again resellers come in different forms. Some are product oriented, others specialize in services, while others focus on certain type of industry applications.  Therefore one needs to tune each program   for each different type of partner (reseller, distributor, etc.).

 4-      Indirect channel partners only know how to sell. Just like myth number 2, channel partners can and do have many capabilities. Again usually each has one or two major strength capabilities, so make sure you know what they are when selecting a indirect channel partner such that their strengths matches with your distribution strategy.

 5-      Indirect channels do not need much care and feeding after the initial start up. This is like the myth of the direct sales force that “loves them and then leaves them” but coming from the other direction.  Probably the worst thing you can do is to ignore your indirect channel. Take this approach and see how long your partners last with you. Make sure you have sales people who know how to manage and support your indirect channel.  The most successful companies have channel partners who have been with them for years.

 In summary, noting that the indirect channels are actually more complicated then the direct channel, one should make absolutely certain that the partners/resellers you select match your strategy. Next, depending on why you selected the appropriate partner, make sure that your partner programs meet your and your partner’s needs. Lastly make it a partnership relationship not just a business relationship!

  Have you thanked your channel partners today?

RHL 01/12/10

Five major direct sales force misconceptions:

1-      That the sales force is only “coin operated”, meaning they are motivated by money, money and more money.   Granted direct sales people are compensated by a combination of a salary and commission, which is usually organized around an increasing sales volume, incenting them to sell more. However, other equally or more important drivers are that most sales people are driven by being singled out at the annual sales meeting as the top performing person in his/her region, or the overall top performer, or being selected to go that exclusive “retreat” for outstanding individuals within the corporation. Another major driver is what I called the thrill of the “kill”; i.e. getting that big order! In other words, competition and recognition are just as important as is the compensation.

2-      That sales people are just “gun slingers”; they see a potential opportunity and drop what they are doing and go after this potential record breaking situation. The true top performing person spends hours in understanding potential customers needs, who is who, generating a strategy, knowing the competition’s strengths and weaknesses and providing the best solution that meets the customer’s real needs.

3-      That sales people only know how to sell.  Again your top sales people not only know how to sell, but often they know the products and/or services usually better than some of the product managers! Sales people also know technology, and more importantly they know the appropriate situations for specific technologies. Probably the best attribute is they know how to propose the best solution for the customer’s problem.

4-      That sales people “loves them (the customer) and then leaves them”.  Good sales people not only get the initial order, but stay with the customer and work to understand other related needs or other emerging needs within the corporation. This accomplishes two major tactics, one, getting embedded with the customer for future business and two keeping the competition out.

5-      That anyone can sell so if I lose a good sales person, so what!  People who say this probably have never sold, just like people say anyone can do marketing. It take a unique combination of drive, motivation, knowing people, understanding needs and fulfilling those needs, negotiating, knowing how to close, and in many cases taking rejection, in order to be a good salesperson.

In summary, while the direct model requires many factors for success, the most important component is the sales force itself. You can create great programs, products/services but if you have mediocre sales people you will not last long. On the other hand you can have mediocre products and programs, and top performing sales people can make up the difference. So do your due diligence on selecting sales people just like you would do on selecting a strategy.

Have you thanked your sales force today?

RHL 01/05/10

On the second day of sales, marketing gave to me two value propositions and an outstanding brand!

On the third day of sales, marketing gave to me, three new market segments, two value propositions and an outstanding brand!

On the fourth day of sales, marketing gave to me, four campaigns for the year, three new market segments, two value propositions and an outstanding brand!

On the fifth day of sales, marketing gave to me, five new social networking medias, four campaigns for the year, three new market segments, two value propositions and an outstanding brand!

On the sixth day of sales, marketing gave to me, six product introductions, five new social networking medias,…

On the seventh day of sales, marketing gave to me, seven testimonials, six product introductions, five new …… 

On the eighth day of sales, marketing gave to me, eight email campaigns, seven testimonials, …….

On the ninth day of sales, marketing gave to me, nine blogs per week, eight emails campaigns,….

On the tenth day of sales, marketing gave to me, ten case studies, nine blogs,…..

On the eleventh day of sales, marketing gave to me, eleven new pieces of collateral, ten case studies,…..

On the twelfth day of sales, marketing gave to me one hundred and twenty thousands leads, eleven new pieces of collateral, ten case studies,……….

What are you giving to sales this season??

RHL 12/22/09

When the best doesn’t come, everyone wonders why goals are not being met, why the sales force is confused and why the partners are underperforming?

I call this approach the “ready, fire, aim” method. The answer to the confusion above is that there is no well thought out, formal partner reseller program.

The following are the major activities that best-in-class partner programs have in common:

1-Strategy- If you have read any of my other blogs regarding sales or sales channels, you know the first consideration already. Any good program must have a strategy. What is the company’s strategy and how will the partners contribute to the strategy? Some of the questions you must answer are: are you developing a partner program to get new customers, new territories, or to augment your direct sales force? Whatever the reason, the program must support these strategies, if not the path will be filled with potholes!

2-A Partner Program: This may seem obvious, but you would be amazed how many companies see an opportunity, but do not plan a program and thus cause a false start and, in some cases, bad will in the reseller community.

Fundamentally a program outlines the why, the who’s and how’s of doing partner business. A partner program is like a business case, it contains items such as goals, objectives, forecasts, roles and responsibilities, partner programs, partner manuals, partner collateral, leads program, training, promotional activities, support guidelines, benefits, procedures/processes, measurements/metrics, engagement procedures, customer service an escalation policy, and much more.

3- What type of partners will you be recruiting? Will they augment your sales force, or a technology, or a skill set, or a region, or help you expand into a new market(s)? Will there be synergy with your sales force or will there be a huge overlap (and potential conflict)? Note that this decision ties back to your strategy.

4- Partner selection: Your program must have documented information on the selection criteria for partners. The criteria should cover among other things: business requirements, certification, capabilities, partner’s responsibilities, partner’s benefits from the program, and sales coverage requirements.

5-Financials: How will the partners be compensated, is there a special discount rate for the selected partners? Will the partners be measured on volume, revenues, or just new business?

6-Targeted Markets- Assuming you have targeted markets for your direct sales force, what will be the targeted market(s) for the reseller(s)? Will they be the same as for the direct sales but with different products, or different markets with the same products or different products and pricing?

7-Measurements- How will you measure success of the partnerships? This will depend on the “stage” that your company is in and the overall goals of the company. As an example if you are in a start-up mode, the measurement for the reseller might just be new business (profitability is secondary), but if you are seeking product revenue expansion, the measurement might be net new revenues.

Well these are some of the major activities that one must consider is developing partnerships. Again, like my blogs that discuss channel selection, things are never black and white and unfortunately they tend to be very gray and complex. Don’t let this scare you away; start with a very well thought out and tested strategy. If you do this step well and involve potential partners, you will be amazed how the well the other activities move ahead.

Till then happy partnering!

RHL 11/23/09