I’ve been there myself and here is what I learned.
The first time you are getting ready to sell your new product to B2B clients is always a special moment. I remember the first time we did that in our startup days. We were so anxious to be well prepared that we hired a sales consultant to make sure we would nail it.
While hiring a consultant is not necessarily required, it does help to reach out to friends who are professional salespeople, read books about it and get organised. You want to be as professional as you can about this, and chances are, you are not a professional salesperson. Neither am I, by the way. So I had to learn these things the hard way.
Just a few words here because it will help you better understand the game you are about to play. Ever heard of a sales funnel?
Sales funnels exist with different labels and steps along the way, and so on. The basic meaning is always the same: You fill the funnel with people to whom you want to sell your product and who don’t have a clue who you are, what your product is and why they need it. And then you develop and educate them along the way until they buy.
So much for the basic understanding. Now what you want to do is this: Put as many people as you can into your sales funnel and move as many of them all the way down to sale as possible. Already, it is apparent that sales are a numbers game. So let me tell you how to prepare for those numbers not to sink your ship.
Get a CRM system
The first thing is to set up a customer relationship management or CRM system. My cofounder had to convince me of this first: I thought we run a three-people sales organisation where everyone knows everyone, and we sit in the same room. What difference is a CRM going to make except for bureaucracy?
It makes all the difference, and I am grateful to my cofounder. Without a CRM, nobody keeps track of your sales effort in a way that permits you to manage it proactively. I would go so far as to say that without a CRM, you are throwing dice.
You can enter all relevant contacts and market players into your system. To me, this is the equivalent of creating a map. Previously uncharted territories become known as you enter company names and contacts.
The CRM keeps track of everyone in your sales funnels. It tracks the development of each lead down the funnel until they either jump off or convert into a sale.
Gathering this data has two key advantages:
A) You can track every movement of all leads, and you will know which salesperson worked on those. This transparency is pure gold in managing your sales effort and understanding what and who works best.
B) You can optimise your sales effort by tracking where your leads convert or don’t. Then you can work on those areas of your sales process in priority. Without the data, you would be guessing. Guessing is the least effective management option.
If you haven’t used a CRM before, don’t worry. I’ve never seen a very complicated one. But do take some time to familiarise yourself with all functions and how to use them best. In our first effort, we used Bitrix 24 as it was the first one we found that was for free. I was not and still am not in love with it, but it gets the job done. Pipedrive is another example I used for an early-stage effort.
Fill your CRM with leads
The next important exercise is filling your CRM (and thereby sales funnel) with leads. You will probably notice how there is no databank of relevant sales leads for IoT enabled smart-industrial-sized-dish-washers or whatever your specific product is.
You are going to have to be creative. Searching through the equivalent of phone books, online databases and so on can be a good starting point. When we had a real estate startup, we filled our CRM with real estate agents by looking at advertisements for real estate and entering names and addresses into our CRM. If you already have a network in your relevant industry, then enter those contacts first. It was enough of a starting point for a sports-related startup I worked with.
Ideally, your sales lead is the person who will ultimately decide to buy your product. If you don’t know who that is and all you have is a company name, I have found it very useful to enter the company into the system anyway. You may find out down the line or hire an employee who knows, one of your mentors may know, etc. By adding even incomplete leads into your system, you build a map of the relevant market. So fill your system and fill in the blanks at a later stage.
Develop a script
The next big piece of homework is to develop a script. I cannot stress enough how important this is. A script will structure your sales conversation and help you ask the right questions. On top, a good script will make sure you get honest feedback rather than some nice but meaningless conversations. This topic requires an article on its own, but here are some key considerations in a nutshell:
Develop your script so that you discuss the needs of your potential client. Create awareness for the problem your product solves, ask how they handled that in the past, and lead them towards imagining a world with your solution in place and how much more beautiful life would be.
I found it super helpful to read The Mom Test when working on my first script. It helped me focus on customer needs and evidence that our product is actually solving a problem, rather than begging for positive feedback.
You do not want to hear your own voice as much as the voice of the customer. He is the one telling you things you don’t already know. Make it about them. Let them explain their world to you, and ideally, with a little guidance from you, you can watch them talk themselves to the right conclusion, that is buying your product.
Finally, objection handling. Once you have your first 30-ish calls of experience, you will notice patterns in your leads’ responses. You may, for instance, find that your IoT industrial-sized dishwasher makes most leads ask the following questions:
- Where am I going to put that?
- How much energy and water does it consume?
- How reliable is that thing?
- I already have an old-fashioned one. What is the added value of your IoT component?
Make a list of these objections and note the best answers you can give. Share that list within the sales team, and you will see your conversion rates between the different steps of the sales funnel improve. Your head of sales (or you) should lead and control the effort.
I found it useful when I concerted sales efforts in the past, to have a weekly sales briefing, in which we included a review of objection handling. That way, everybody was up to date on which objections were coming up and how to best handle them.
Finally, a word about realism: Sales can be discouraging as, more often than not, people will not jump your business bones immediately. So how do you know if you are facing the usual headwinds or if you or your product sucks?
A good reference and great read on the matter is a little book called Crossing the Chasm. In it, author Geoffrey Moore discusses how new technologies enter the market. This book easily deserves an article on its own, but to make a very long story very short: Expect roughly 1/5 calls to get you places.
1/5 is the proportion of innovative people. They bought the first generation of smartphones because they like being on the edge of development. Other people are more conservative than that. There is nothing wrong with you, your product, or your sales lead if you have a conservative person on the phone who says no. Move on. Every no will get you closer to a yes.
Sales have a lot to do with determination and discipline. If you do not have the means to control what your salespeople are doing, you are running a risk. A weekly sales briefing was my key management tool to steer the team’s effort in the right direction. The agenda was always the same:
- Review of last week: Numbers and results — We discussed how many calls we made, how they converted, where we stood with our respective leads, if any new leads entered the CRM and so on. We took time to praise the most successful person
- Content and knowledge: Focus on the product, the script, objection handling — Talk about content and methodology, as opposed to numbers. Get everyone up to speed, share best practices, cry together and high-five each other
- Planning the new week: Numbers and expectations — Looking forward, what is in focus, whom do we want to convert, whom do we want to reach out to, what are focus areas for individual salespeople
The CRM system is a very powerful tool. I regularly go into it to see whose leads convert most successfully. Typically, in the early stages of a company, leads are assigned more or less randomly. So there is no reason to believe that one person should convert better than others.
I remember once I analysed the conversion rates of the CRM to find that our head of sales had the worst track record in the company! An unpleasant conversation followed with that head of sales, but one he could not run away from since I had the numbers pinned down.
You can find an account of my very first sales effort here. It did not go as planned. If it turns out, neither does yours, be prepared to draw the right, at times painful conclusions.