- Posted by Randy Hendriks
- On September 21, 2017
- 0 Comments
This is an “edited” version of the first episode of our Startup Sales and Marketing podcast, Sales Planning Fundamentals, with some referring links highlighted:
Randy: Steve, tell me about the VA Partners story.
Steve: The premise of the model was around helping Startup companies in Canada sell more effectively, getting to market faster with seasoned sales experience. The original idea came back in 1999-2001 when the dot-com bubble was inflating and exploded. A lot of that was predicated on the fact that while there may have been great technologies, no one was willing to pay for them. Fast forward to 2006, and we started working on a part-time sales model, having a bank of hours per month, and we would white label ourselves.
R: An important element for VA Partners is the Sales and Marketing Fast Start Plan. Why is that important to have in place?
S: Everyone needs direction. A sales and marketing plan will give you that. Who are you? Where do you want to go? What are your goals? What are the core actions you need to undertake to be successful? All that is outlined in your sales plan. I think a lot of people spend a ton of time planning and talking about doing something, but with a sales plan written, you can spend most of your time executing it. Then, if you need to make changes in direction, or tweaks to strategy, you can do that while you’re working. But you need to have a formal place to start from first.
R: Any examples where you saw the benefit of having the plan?
S: Well, for every client we work with we do it first, there’s really no choice. I can’t remember a situation where we haven’t done it. Without the plan, you have no idea where you’re going. The plan not only encapsulates targets, and contacts, but it includes your value proposition: who you are selling to. That could vary based on your target. It could be a direct target or channel. Then you not only have two different messages, but two different ways to support that, and the sales plan lays all that out. It lays out scripts, even the competitive market, the landscape, who you’re competing with. It may not be others with the same technology, but if you’re fighting for budget dollar, given that they’re finite, you can be competing with people with comparable or even adjacent technologies, since there’s only so much money. A lot of people don’t realize, it’s not just you. You may have the only solution in the market around what you do, but there are other people vying for that same budget dollar. That’s why it’s important to have a plan and to cover objections they might have regarding your solution.
R: What are some common myths for startups when it comes to sales?
S: One consistent myth is that your product is going to sell quickly. People underestimate how long it takes to identify, qualify, propose and close an opportunity. Generally, we find in B2B sales it takes 6-18 months. A lot of startups don’t leave themselves enough runway to close sales on their product, understanding all the steps involved. For example, first, you’re going to identify a target account, researching a couple contacts, then start an outbound effort, by emailing calling or Inmailing. Your qualification process happens at this time. Once you get them on the phone or get a response and they show interest, you have them qualified as interested, and follow that with a process of pushing through to further qualifying and then to a proposal.
R: Sometimes there’s that breakdown trying to get to that next level reaching someone in that organization?
S: Right, typically we like to start selling high. You may get pushed down through the organization to the operational decision makers, but ultimately you need the person with the budget control to sign off on it.
R: Tell me about where startup sales processes can break down?
S: The biggest one is that often you may not have an experienced sales person selling for you, and you’re not using infrastructure to support your sales process. Sales is really a methodology, a process you follow, a set of repeated steps, and you need a tool to help you manage that. A CRM such as Salesforce, Zoho or HubSpot are effective tools, helping you track progress. Without that, you lose sight of who you’re going after. There’s a lot of noise and you can get overwhelmed with the leads that you have on your plate. So, without a formal sales process in place, you’ll get stuck. Another myth is “selling too late.” You can wait until your product is 100% commercialized and 100% market ready. People need to keep in mind that, whether they’re selling a product of any kind, you need to be selling early, priming the pump early, even getting pre-sales, getting people willing to pilot it. It’s like the agile development model: nothing is 100% correct, so get it out there, get people to try it, improve upon it, and get it into the market. That ties back to the first point I mentioned, about people not realizing how long that sales process. This is one way to help shorten it: you get customer feedback, you get case studies. No one wants to be the first to try something, so you get into the market, get people trying it early, get feedback, and buy-in.
R: Are there any other supports or resources you use regularly when you’re trying to move the sale along?
S: When you look to the sales stack, CRM is the base, then you can leverage that into marketing automation. Salesforce has Pardot, HubSpot has theirs. You have ContactMonkey. You want to understand when people are opening your emails. Then you’ve got LinkedIn: using LinkedIn Navigator and LinkedIn premium, where you can do advanced searching for different types of contacts. There’s MailChimp, Constant Contact and more. Although they are a marketing play, really it’s a sales play, because what you’re trying to do is keep top of mind, be present, and put yourself in a position to sell.
R: A couple tools that I’ve been using are Hunter.io, which is a Chrome plugin that will help you find any emails connected to a domain name, simply by clicking one button. Another free tool I’ve been using is called Mailshake. As you said it’s marketing automation, but really about supporting the sales process. You can automatically send follow-ups, see when they’re opened, and you know which leads are the hottest. That’s important when you have a list of 50 people to follow up with.
R: You’ve been doing this a long time, what are some difficult situations you’ve been in and how did you handle them?
S: Well, I’ve been selling for over 20 years so there’s a lot. One funny one was working with one of our clients in the work truck rental and leasing space. I had booked a meeting to meet with a prospect. Actually, it was with the CEO, but he pushed me down to meet with his fleet guy. I went in to meet with him. He was clearly not happy to see me. I don’t know if he was worried about his job, but basically, I had to stand beside his desk and pitch to him. In a room of other people. No chair offered. No drink of water. I just had to push through, talking about our client, Thomas Solutions. An awkward situation. That typically doesn’t happen but it made for a great story after. I got on the phone with our client and we had a good laugh about that. That was pretty unique.
R: Have you ever been in a situation where you surprise yourself, or that things turn around in the middle of a difficult situation?
S: Even prior to VA Partners, if you go back years ago, I was working out of Boston for a firm in the UK, and they were in the telecom and IT space. That was when Blackberry was growing quickly and had taken the market by storm. I went to them, to tell them about the solutions I was selling. I remember the guy at Blackberry telling me, “There is no way in hell I would ever need what you sell.” I just didn’t believe him, and persisted, and over the course of a year and a half, they became my firm’s biggest client in Canada. They went from zero to north of six figures annually in revenue. The “no such thing as never” is a good lesson I learned there. If you’re selling a good product, and you know it has legs, keep pushing it. For startups perseverance is critical. It generally takes 8-13 touches to close anything, if not more. Where most sales fail is that they won’t put the time in up front. They’ll put one or two phone calls or emails and stop. You can’t do that. If you believe the client could utilize the product, that it could be of benefit to them, you need to persist in your approach, at least 8-13 times. Those touches could be emails, calls, InMail, direct tweets, events, anything to push towards a close. Some of those could take 6-18 months. Another thing to consider is to not just go after one person at a company. You can’t always go direct and narrow. Sometimes you need to go a little more horizontal in a company because you don’t know who the final decision maker is when you’re cold calling in. If you think it’s the CMO try it. But why not try to CEO and COO too? Don’t be afraid to try different contact points to drive your product or solution into a good company.
R: How do you know when it’s just not going right?
S: First, let me give you an example of one going right. We have a firm, Radical VR, and they are producers of VR content for the museum industry with full deployment: headsets, hardware, as well as the VR experience in a museum. When we send out 20 outbound emails, we get 5 responses, 2 are interested. That’s an example of a good response rate, and you know you’re on the right track. You know the messaging is right, and there’s a need in the market or at least an interest in exploring that.
R: So you can gauge, right off the bat, based on responses to your call to action, from responses to calls or emails, that they’re engaging with you?
S: What you want to understand is conversion rates. So, if your conversion rate is 1 close for every 20 calls, you know where you stand. If it’s 1 in 60, okay, at least you know how many calls you need to make to convert to a close or lead. That ties back into sales planning, and forecasting. When you’re setting your goals. If you need to close 60 people in your first year to get to a million dollars, how likely is that with only two people selling?
R: So you need to extrapolate the numbers and see what it means. 60 closes might mean 210 000 calls based on your conversion rates you’re seeing. Not likely.
S: Yes, so don’t set yourself up for failure, have realistic expectations, by understanding conversion ratios. Another story where things didn’t “work” was with a firm that was in the digital asset management space. They had built a neat solution a number of years ago. It was very niche. We started making outbound calls and emails, to prospects, and out of 200 prospects we had reached out to 198 of them showed absolutely no interest and the other 2 simply said “no”. Zero for two-hundred. What that showed us was sometimes there’s just no game. As a startup, you need to remember that you may have a neat solution, but the market might not be buying it. After we tried a few different verticals, but without any success. We suggested that, unless they had another vertical they wanted to try, shelve it.
R: From my experience, the earlier you can validate the better. If you’re validating all the way through, even before you get to the sales process, you’re already getting some confirmation that you have the right product and a value proposition that’s resonating with your buyer.
S: That’s why, even when you’re building, validate it, give it to them for free, whatever you have to do. Get validation and an understanding of the market landscape early. One last example, we received a lead from friends of ours. This was after the earthquake in Haiti, just when text-to-donate had kicked off. Our client had built a platform to support that. The plan was to go to charities who wanted to offer text-to-donate solutions and charge them a $5000-$10000 upfront fee for setup and a small fee for all donations that came in. Well, what happened was that the market was already being commoditized by one other competitor. They were giving it away for free. No charge at all for the platform, but only a salami slice off the donation. This really left no room. When you’re looking at paying a sales team, this left no market for that. You can’t afford to have a big sales team doing outbounds for you in a market that has already been commoditized. Brilliant plan if you’re first to market, you can commoditize your space and leave no room for anyone else. Brilliant.
R: Fun Question: Which historical figure would you like to be?
S: I don’t know if he’s historical, but I think it’d be kind of cool to be Mark Zuckerberg, and have all that kind of money!
Thanks for listening/reading through episode 1 of the VA Partners Startup Sales and Marketing podcast. Got a question, or looking for sales and marketing support for your B2B Startup? We’d be happy to have a conversation with you.