For more than 25 years Reinhard Janning has held various sales and marketing positions in the IT industry. As a founding member, author (“Kunden machen was sie wollen) and CEO of ec4u marketing experts ag he has played a central role in the definition and implementation of marketing and sales processes for renowned B2B and B2C clients. He has shared his wide knowledge and expertise in lectures, webcasts and at conventions for many years.
e4u marketing experts ag is a global Consulting and Implementation firm specialising in Marketing Automation and Lead & Customer Lifecycle Management, with centers of excellence in Europe.
Marion – in gratitude
Christopher and Frederic – as an incentive and motivation
Erwin – with respect and appreciation
On a cool autumn day in 2010, I’m in Boston attending the “B2B Marketing Summit“ Conference. Following an inspirational introduction on the subject of “Real-time Marketing and PR” by David Meerman Scott, people begin to flock out of the conference hall for their first coffee break. I join the queue of people waiting for David to sign their copy of his book.
When I finally reach the top of the queue, we exchange a few words. “Social media are tools – real time is a mindset”, he says to me. “It’s all about speed. Tools can be replaced. It’s the mindset that counts. “
And suddenly it dawns on me: everything I have experienced up to this point is much more than a passing trend. The world of marketing and sales has changed completely. The old mechanisms of the customer-supplier relationship no longer work in the new online world. And that is the very reason why I set up a company and have used our ideas to help many customers change their marketing and sales processes for the better. Our meetings have frequently ended with us discussing how to implement CRM and marketing tools.
But now I know that “a fool with a tool is still a fool!” Tools alone are not the answer. We need to develop a new and holistic approach to sales and marketing. I would like to help ensure that marketing departments generate good leads for their sales reps so that they can focus 100 percent on their core task of selling. After all, to generate revenue isn’t the aim but rather the result of good sales performance.
This is what my book is all about.
Reinhard Janning, August 2015
Let me take you on a journey back to the early 1980s in Germany. I had successfully completed my secondary school education and was considering what to do with my life. I wondered if I should study history. Yet I was also interested in computers. Perhaps I should do an apprenticeship in this area? Or would I be better off studying history first and then doing an apprenticeship in the field of computer science? Somewhere along the line I reached a decision and applied to a number of companies that seemed to fit the bill. And lo and behold, Nixdorf Computer AG, the most innovative computer manufacturer at the time, was willing to take me on! I was over the moon!
However, it didn’t take long to wipe the smile off my face on my first day at work as a trainee data processing clerk: I was assigned to the sales department. Sales! What on earth would I be doing in sales? I had no intention of becoming a salesman, my aim was to learn about programming! When my boss said “I am taking you with me to visit a customer and I will teach you a thing or two about sales!”, my initial scepticism began to fade and it virtually vanished when I clapped eyes on his company car, a shiny white Ford Escort convertible with alloy rims! Perhaps I should consider sales after all, I thought to myself.
One week and many customer visits later, when I had begun thinking sales wasn’t so bad after all, my boss said to me: “So, now I am going to show you the other side to sales!” What did he mean, I wondered, was there more to sales than making business trips in a white convertible, filling sales pipelines and drawing up annual investment budgets? You bet there is! My boss placed a large stack of the Yellow Pages from the most important cities in the surrounding area on my desk. “Now son, I want you to call transport companies and make appointments you can pass on to the sales team” he said.
This was the beginning of what turned out to be the three most boring weeks of my working life. I sat at my desk day in day out, phoning my way through the never-ending lists of transport companies I had found in the Yellow Pages. I got to speak to secretaries who fobbed me off or was put through to decision-makers; I did my best to get them interested in our systems and products and to arrange appointments to pass on to the sales team. Now and then I managed to do so, but in the majority of cases I did not. I certainly didn’t feel I was making any real progress or was accomplishing my goal of arranging sales talks for my boss. If nothing else, this experience taught me one lesson. I wanted to be the one driving the Ford convertible – even if this meant making boring and frustrating calls in the early days.
By this time, my aim was clear, I wanted to move into sales as soon as I had completed my apprenticeship. I was fortunate enough to have had excellent instructors who taught me from scratch what sales meant in this day and age. It was all about providing customers with comprehensive, personal support, conducting sales negotiations, guiding planning talks about annual budgets and looking presentable at major customer events, even though, as a younger and more inexperienced person, I sometimes felt out of place among all these executives and decision-makers.
This was the beginning of my passion for my job, something that continues to drive me today. It would be fair to say that I put my heart and soul into sales, won a large number of awards and was always one of the youngest to climb the career ladder. After my time at Nixdorf, I became sales manager and then CEO of the German branch of an American software company where I continued to focus on sales, just as I had done at Nixdorf. Sales was the name of the game. At the very least within the corporate hierarchy. And nothing came after that for a long time... Not even marketing. It was considered to be more or less superfluous. Marketing – were they not the people who produced colourful images and came up with catchy headlines for image brochures? In those days, the term “marketing” was rarely used at Nixdorf either. The buzz word at the time was “sales promotion”. And in my opinion, this hit the nail on the head. After all, we were the ones selling!
But then something happened: The Internet came along and with it a whole new type of communication. All of a sudden we were corresponding with our customers via e-mail for which we needed neither an office nor a secretary and things such as e-mail marketing emerged. At the same time, it became acceptable to call customers on a mobile. I quickly realised that it had become much easier to reach customers than it had been in the days of my apprenticeship. Unthinkable now to have to work your way through lists of phone numbers in the Yellow Pages? This really had well and truly become a thing of the past. And what is now common practise began to emerge, albeit tentatively at first. Prospective customers began searching the Internet for information about products and services, comparing prices and offers and taking their decision to purchase independently and for reasons that were not quite clear to us salespeople.
The Internet and changes in buying patterns were the two trends that inspired me to establish my own company DemandGen AG in 2003. I set up the company together with my business partner. Our aim was to combine state-of-the-art online marketing with selling efforts and to offer this to our customers as a service, moving away from cold-calling and from working one’s way through lists of telephone numbers. We only wanted to call people who had, for instance, shown their interest by clicking on a link. We referred to this as “teleprospecting”. In addition to qualifying leads through e-mail marketing and landing pages, it was the first service we provided and expanded over time.
This highlighted the fact that the general sales environment had changed thoroughly since I had been an apprentice. Cold-calling or having a salesperson provide customers with comprehensive, personal support is just as much a thing of the past as the annual budget negotiations with key accounts, the expensive customer events, the big, fat company cars and high expense accounts. Things had begun to move much faster, companies began planning quarterly rather than annually, were taking decisions much faster and were much more confident in their approach.
It had also become possible to strike huge deals without ever having met the decision-maker – something that was unheard of in the past! As a service provider, there was no longer any need to make several visits to customers in order to obtain a decision. Of course we continued to communicate with our customers, but we did so more and more over the phone, via videoconferences or using other tools. Despite all of the above, one thing was clear: If customers saw a certain benefit in a product or service they were buying, having personal contact with the salesperson became less and less necessary and important. Customers had of course looked up all information they needed both about the product or service and about the company selling them. But there was no longer any need to provide these customers with comprehensive, personal service. The world of selling had changed forever. As sales experts, we were now providing our customers with a completely different service.
The most obvious symbol of sales rep is a suit and tie which to me will always be the typical image of a sales rep. I personally stopped wearing a suit and tie in 2001 when I started my own business. This was about me being true to myself and about my changed role as a sales consultant. Or perhaps it would be more apt to say it was about the changed appreciation I began experiencing as a salesperson. I am no longer the person who annoys other people by cold calling them. My aim is to solve the challenges my customers encounter with their own customer acquisition.
I did not have that eureka moment in my career until DemandGen had been up and running for quite some time. I was visiting a customer and was advising him how to launch a new sales process when he introduced me to a tool the US branch of his company was already using. In addition to integrated e-mail marketing, this tool was using cookies to follow the surfing behaviour of visitors to this company’s website. It mapped the entire campaign management on an integrated software platform and evaluated how effective the company’s marketing was. With a simple click of the mouse, website operators learned what their customers were interested in, what information they had downloaded and what marketing-e-mails they had actually opened. Using this information as a basis, they were then able to develop workflows enabling them to send e-mails to specific customers and to supply them with precisely the information they needed. And this all happened automatically at the precise time the prospective customer needed this information.
I couldn’t wait to call my colleague and partner with whom I had set up the business. “I saw something today that will revolutionise our business in the next few years!”, I said to him excitedly when I finally managed to get hold of him on his mobile. One thing I realised immediately was that this software platform provided the answers to many questions that had arisen for me on a daily basis. How could one see and analyse what topics were of interest to customers, what information they needed, what stage of the decision to buy customers were at? And how could we see and analyse, all of the above precisely when they were trawling the Internet for the information they needed – before making a decision to buy anonymously and without the involvement of salespeople?
Marketing automation was the answer. It involves software platforms which supply this very type of information, naturally only after the customer has given his consent to his visit to a website being interpreted and analysed. Marketing automation brought the breakthrough for our company, DemandGen AG. Since we familiarised ourselves with these systems, began using them ourselves, but above all since we began installing them for our customers, we have grown from a German marketing and sales agency into a multinational consultancy and systems integration company.
Don’t get me wrong. This is not about a fashion, a trend or about selling another kind of complicated software which is supposed to make life easier and more pleasant. It is about something I have observed and experienced in sales and marketing in many many companies over the past 25 years and which I have full confidence in. Only companies that acknowledge the changed buying behaviour of their customers, regardless of whether they are B2C or B2B customers, will be successful in future. Only companies, that acknowledge and accept, that in this day and age customers conduct nearly all their search for information about products and services online, and usually only contact a company, when they have already formed their own opinion, and have a pretty exact idea of what they want to buy, only those will generate enough revenue.
Yet the bizarre thing about it is – when I talk to marketing people about this, they all agree with me to begin with. After all, they adopt the same approach – if they, for instance, are buying a new fridge, are inquiring about mobile phone rates or are looking for the perfect all-in-one holiday deal. They too compare offers, providers and service features on the Internet, read studies, carefully consider test results and search for other buyer ratings in online forums. And somewhere along the line, they decide which product to buy. This is run of the mill stuff.
Yet when it involves the day-to-day work of their own company, it is a whole different kettle of fish for these marketing people. They prefer to use their standard repertoire comprising print advertisements in trade magazines, pompous stands at trade fairs, sending out advertising mailings followed up by a telephone call rather than giving prospective customers exactly what they are looking for on their website, namely in-depth information in the form of studies, e-books, videos of presentations etc.
And incidentally, with uncanny regularity, these marketing people argue that their own customers behave in a completely different way than they themselves do. After all, they say they are dealing with the B2B environment, are not selling to B2C customers, but to other companies. And with equal regularity I respond by saying “It is completely irrelevant whether you are targeting B2C customers or B2B customers. Whether somebody is buying a fridge for their kitchen or new ERP software for their company, the sales process follows very similar rules. B2C and B2B customers start off by looking for the information they need on the Internet, they take a decision and only then do they contact the provider.”
To sum this up: Nowadays 84 percent of decisions to purchase are influenced by, if not made, on the Internet. Only companies that rise to this challenge and who respond to changed customer wishes will be able to hold their own in the marketplace.
So it is important for companies to identify people who are interested in their products at the earliest possible stage online, preferably when they visit their website for the very first time. For let’s face it, prospective customers may come to your website, leave it, look for information on other websites and never return again. So companies need to be able to obtain initial information about prospective customers, for instance, their e-mail address, at this early stage. Otherwise it is very difficult to provide them with additional useful information at this key stage in the decision-making process or to get in touch with them again at some later stage in the future.
This time buyers need to gather information and taking a decision to buy is important for the opinion-forming process. It is impossible to predict how long this phase will last, it depends on the amount customers are willing to spend, how complex the product is and how urgent the purchase is, but also on how many people are involved in the decision-making process. This used to be relatively simple. The boss was the one who took the decisions. Full stop. Today things are quite different in many companies. The decision-making process has become more complex which explains why several people tend to be involved in deciding what to buy and what not to buy.
And there is another aspect worth considering. Whereas companies used to plan new acquisitions and budgets a year in advance, integrating suppliers into these plans, it is a whole different ball game nowadays. The planning cycles are short and companies therefore rely on their own research, but also on the product and purchasing recommendations of external consultants. Salespeople have little or no opportunity to link up and to strike a deal, or let alone fill a pipeline twelve months in advance. I have had the opportunity to observe this in the talks with many companies over a large number of years.
To put it in a nutshell. Customers buy when they want to buy. They frequently take a decision to buy alone without a company’s salespeople having had the remotest opportunity to talk to them, let alone showcase their products and services or to enter into sales talks with them. This has been proven by many studies on online marketing.
Companies have little or no opportunity of getting in touch with their buyers while they are forming an opinion. That is why the information buyers provide the first time they visit a website, for instance, the e-mail address they provide when they sign up to download a certain white paper or study, is all the more important. Only companies that succeed in bridging this decision-making phase (referred to by Forrester Research as the “consideration gap“), for instance, with intelligent e-mail marketing, have any real chance of turning leads into customers.
Figure 1: decision-making phase
One thing should be clear by now. Companies that do not manage to provide customers, who are considering buying their products and services with precisely the information they need to take a decision to buy, will undoubtedly lose out. To put this information together and to make it accessible on their website is hence the first step in the buying process. And I suppose you think that, because this is part of the purchasing process, sales should be responsible? Well, I’m sorry to have to disappoint you! Marketing is of course responsible for face-to-face contacts with customers and for a company’s website. That is why it is also necessary to develop mechanisms which ensure the people visiting websites find precisely the information they need.
Furthermore, marketing is responsible for measuring and evaluating what is of interest to website visitors, what products they look at and what they download. And by the same token, this explains why marketing is also responsible for finding out what website visitors actually want. Do they want to buy something, apply for a job with a company or perhaps just take a look at what their competitors are getting up to? Marketing should only pass on the e-mail addresses of customers who are genuinely interested in buying to the sales team.
The entire process of how to turn a prospective buyer into an actual buyer is known as lead management. Separating the wheat from the chaff, identifying prospects who are genuinely interested in buying and passing this data on to sales is one of the first key steps in this process. And this is precisely why lead management is part of marketing not sales.
It goes without saying that none of this is possible without sales and marketing alignment. Herein lies a major challenge because up to now these two departments have been more like cat and dog in many companies than have impressed with smooth cooperation. I have had many a discussion during my career about which is the cook and which is the waiter. And on more than one occasion I have heard reps of the marketing and sales department roaring at each other during meetings because one thought they were more important than the other.
One thing is certain: the two go hand in hand. It is harmful to any business for marketing and sales to regard each other as opponents and not to cooperate. This perhaps explains why marketing staff find it difficult to prove to management what results individual campaigns have, for instance, how many sales the publication of a white paper actually resulted in. And salespeople invest too much effort and hence time in prospective customers who have no genuine interest in buying their products or services. Only if the two departments manage to sing off the same hymn sheet, using the matching processes, methods and tools, are the two important factors of entrepreneurial success given. This means the contribution marketing makes to a company’s revenue and gross profit can be measured, and sales reps encounter customers who are more likely to make that purchase when contacted in person.
The sooner marketing and sales reps get together around one table and jointly define which prospective customers are most likely to become actual buyers, the better. Or to phrase it differently: Only companies that manage to bridge the gap between sales and marketing will survive in the long term.