Editor’s note: CRO Coffee Talk is a community built for revenue leaders by revenue leaders to discuss and solve the challenges that CROs and sales leaders face today. Dan Swift...
Editor’s note: CRO Coffee Talk is a community built for revenue leaders by revenue leaders to discuss and solve the challenges that CROs and sales leaders face today. Dan Swift of Empire Selling co-hosts these impactful, insightful conversations with Mark Ebert, 6sense’s SVP of Sales.
“The B2B buyer’s journey has changed! Sellers have to change the way they sell.”
Quotes like these have been a common theme in industry content streams for several years now, but there’s not been a lot of at-hand prescriptive insight into what exactly they all mean. How exactly did the buyer’s journey change versus before? Where are the biggest holes in the new buyer-seller dynamic? Isn’t this just a marketing issue?
In an effort to get more clarity on the data, we invited former Principal Analyst at Forrester and current Global Innovation Evangelist Mary Shea to a recent CRO Coffee Talk session to discuss the findings from her latest research report. For the report, Shea partnered with Forrester to interview over 200 buyers across a wide breadth of industries whose purchasing power ranged from $50K to $100M, and asked them a battery of questions around their buying habits and expectations of vendor reps.
Their answers, combined with data from salespeople who’d been surveyed in adjacent industry research, revealed some big implications for revenue teams.
As new generations have matured into the workforce, so have they begun taking on more senior buying responsibilities. Shea’s report showed that Gen X and millennials now compose over 90% of professional buyers in some industries, with fewer than 10% identifying as baby boomers.
Gen X had a front-row seat to the birth of the internet and social networking, while most millennials grew up with these technologies from a very young age. As a result, these new multi-generational buying groups have very different expectations for salespeople and how they want to engage with them.
Shea’s research showed that 86% of buyers indicated that their preferred method of interacting with sales reps was by virtual meeting. With the increasing occurrence of remote work policies, this preference isn’t likely to change. For these digital natives, the old world where salespeople walked the halls of their customer’s office looking for business is long gone.
Buyers want to dictate when they’re open to having a vendor conversation, and are showing up to meetings significantly more informed than their predecessors. And since buyers will have finished up to 70% of their vendor research before they reach out to a rep, the burden for sellers to fill in the rest of the knowledge gap in the initial pitch meeting is much greater.
According to Shea’s data, 62% of queried buyers responded that they expected the seller to know and be able to answer their questions in real-time. More than just making initial meetings more productive and informative, 53% of the buyers indicated that being able to answer their questions in the moment also increases their confidence in the vendor/seller.
Any seasoned sales professional can attest to the fact that this confidence from the outset can be the difference between a Closed-Won and a Closed-Lost, regardless of product features and functions. As one CRO noted, “It used to be that you could respond to prospect questions with an, ‘I’ll get back to you,’ but that no longer works.”
The upside to having all of the answers in the first couple of meetings is a shorter sales cycle. The downside is that sellers are on the hook for being product experts, a role that’s already occupied by support staff such as Solutions Consultants/Engineers and internal Subject Matter Experts who don’t want to be brought into the sales process until the prospect has been adequately qualified.
Which raises the question: If support staff need to be in the first meetings with a prospect in order to increase and accelerate the potential to close, what’s the point of having a sales rep? Why not simply have a point of contact for the prospect that handles paperwork on behalf of the Solutions Consultant? Having a sales rep and support staff every single meeting increases the Customer Acquisition Cost significantly as well as puts more importance on hiring experts instead of sales reps.
The quick answer is that sellers need to be more efficient. But the quick answer, according to Shea’s research, is already one of the biggest pain points for sales organizations.
There’s a certain statistic that has haunted sales organizations for decades: Most sellers report only spending anywhere from 20% to 30% of their time actually selling. These activities include prospecting, speaking with customers, demo meetings, and direct outreach.
Shea cited Forrester research that found reps reported that up to 77% of their time is spent on non-selling activities such as enablement training, searching for content, coordinating internal resources for a customer meeting, and sales technology admin work such as updating CRM.
Shea referred to this discrepancy between what sellers do versus what they could do as the “sales execution gap.” For those currently doing the math, sellers are revealing that, in an eight-hour day, they’re only spending two of those hours actively selling.
One CRO noted that when he was carrying a bag at Salesforce 13 years ago, they were using a very similar stat to sell the company’s CRM technology. If sellers are still lamenting the lack of time they have to sell, then clearly the demands of the business have outpaced the efficacy of productivity software.
The question becomes: How does a CRO increase their sellers’ efficiency and success? It could be tempting to cut enablement training hours, for example, but the one thing sellers consistently ask for is more training. In addition, better training remains the best solution to answering the aforementioned modern buyer’s demand that vendor reps be able to answer all of their questions in the moment.
Sellers aren’t just lamenting the lack of product knowledge training. Most of them are suffering from lack of leadership training, too. Shea cited that sales managers reported spending only 14% of their time on training. One reason may be because other major parts of selling — namely, forecasting and sales process — remain painfully time-consuming and inefficient despite advances in technology.
Sixteenth-century English philosopher Thomas Hobbes once described a life without agreed-upon conventions as “solitary, poor, nasty, brutish, and short.” If he were alive today, he’d likely say something very similar to describe the old-school life of a salesperson.
For a long time, sellers were expected to sweat and grind through their target list, prospect buying cycles be damned. Most sales strategies were designed during a different era when salespeople were showing up in-person to glad-hand a pitch meeting.
Even after more processes were added into the sales cycle, changing buyer dynamics have rendered some tactics obsolete. Take, for example, the “Challenger Sale,” which enables sellers to challenge prospects to think a different way about their problem. At its heart, it’s still a smart strategy, but with most buyers doing most of their research beforehand, the Challenger Sale now starts before the buyer even raises their hand to speak to a rep.
In a modern sales motion, companies that aren’t aligning their digital marketing strategies with their sales execution strategies are in danger of being left behind. CROs must think through an employee advocacy program for their sales teams in which everyone is sharing information about the company, relevant industry news, and peeks at their own professional passions to help humanize them to the market.
People buy from people, and there are more people now in the buying committee than ever before. Shea’s research referenced Gartner’s 2019 Buyer Survey which found that the average number of stakeholders in the decision making process now averages around 11 people. This number can go up to 20 or 40 at a large enterprise company.
As the buying committee has ballooned, 75% of decision makers agree or strongly agree that the buying cycle has also increased over the past 24 months. According to research by Forrester, sellers have witnessed this change firsthand: the number of interactions needed to close a deal in 2019 was 17. A year later, it almost doubled to 27 interactions.
The gulf between buyer expectations and a seller’s internal processes is widening. One of the best ways to fill in the gaps at scale is by indirectly influencing the buying process, as opposed to always trying to brute force a conversation with sequenced cold outreach.
Forecasting has been a bane to seller productivity for a long time. It’s not for lack of great technology. Tools like Clari and People.ai have helped smooth over the tech side of the struggle, but internal demands of forecasting haven’t evolved much.
To address just how badly the forecasting process is, Shea cited some grim numbers from sales leaders:
It’s become too easy to use valuable 1:1 time to review deals in the pipeline for potential to close in-quarter. This has a massive impact on seller productivity and stress levels. As one revenue leader said, “Forecasting should migrate to an ‘always on’ state as opposed to a weekly update. And the forecasting process should focus on how to increase the seller’s forecast versus just stating what it is.”
A few final data points from Mary Shea’s research: in a December 2021 Gartner report that surveyed chief sales officers, 70% expected their budgets to increase in 2022. Eighty-four percent wanted to invest that budget into sales technology that better enables virtual selling. Fast-forward to the end of the first half of 2022, and the environment couldn’t be more different.
With recession worries looming heavy, companies have already begun to cut expectations and headcount ahead of a broad economic downturn. This means that sales teams will need to do much more with much less: smaller, more agile teams attacking smaller pipelines; of which they’d need to hit 70% to 80% of target.
This scenario adds real urgency to the need for CROs to take an immediate, holistic look at their teams and processes, and do the hard work of retrofitting their old playbooks with a more modern go-to-market approach.
Instead of viewing Sales and Marketing as two separate teams, it would behoove senior leaders to view them as one team with two very different sets of responsibilities that are aligned around better informing prospects during their research phase, and then enabling them to buy more easily once they initiate the sales process.
What do successful revenue leaders have in common? They come together every other Wednesday to our CRO Coffee Talk conversations to compare notes and build a community around best practices and cautionary tales.
If you’re the head of revenue at your organization and want to level up your game, won’t you join us?