"When I started out in sales, I'd get a call from a customer asking, ‘Where's my order?'" says Denver-based sales performance consultant Tom Fee. "I'd hang up, pull the order number out of the file and call the factory. They'd call me back to tell me if it was shipped. Then I'd call the customer back."
Nowadays, salespeople don't need to get involved in such mundane tasks. The customer can call the factory direct or, better yet, check order status on the Internet. "The salesperson never has to lift a finger."
When the Internet first started taking over many of the mechanical details of the sales process, some predicted that the sales force would soon be rendered obsolete.
It turns out that nothing could be further from the truth.
"Checking orders is not a productive use of salespeople's time," says Fee. Freed of those routine tasks by the Internet, "Now they can get on with the serious business of selling. They can call on more new prospects or existing customers and build stronger partnerships, instead of wasting time on busywork."
In a report titled The Taxonomy of Selling in a MultiChannel World, authors Sheryl Kingstone and Chris Selland of The Yankee Group conclude that existing selling channels (like salespeople) will not fade because of the presence of new channels (like the Internet). But, the report goes on, "Selling on the Internet will be most effective where efforts are combined with other selling and service channels to maximize the benefit for the customer."
Welcome to the multichannel world, where the direct sales force peacefully coexists with the Web site, telesales and indirect channels like resellers, letting customers access the company whenever and wherever they choose.
Forecasts for the size of the global e-commerce market in 2002 range from $500 billion to $1,500 billion, according to a report called Beyond E-Business by Boston-based e-services consultant Extraprise. But despite the hype surrounding e-commerce, in reality there are few pure dot coms. And though Extraprise calls the e-commerce market "the fastest-growing distribution channel in history," it admits that e-commerce still only represents about 5 percent of the estimated global economy.
Many products are still much too complex or personal to buy online. "Would you buy an oil rig or a diamond ring over the Internet?" asks Austin, Texas-based CRM consultant William Brendler. "No way."
"Humans are social animals," says Bill Blundon, Extraprise executive vice president. "The human touch will always be a part of sales."
Extraprise focuses on the problem of balancing online sales with offline channels such as salespeople. "Until recently, e-commerce was all people wanted to talk about," says Blundon. But he has seen a change, partly brought about, he thinks, by the plunge in high-tech dot com stocks on the NASDAQ six months ago. "Now the pure Internet model is viewed with suspicion," says Blundon.
The Internet is an excellent channel, but not a business, according to Blundon. With very few exceptions, online merchants have moved to integrate the human touch into their selling process by bringing in a call center or a direct sales force. "Typically 65 to 85 percent of shopping carts are abandoned," says Blundon. "Adding a human being, be it through chat, Voice-over Internet Protocol (VoIP), phone or just having a button where visitors can click on ‘call me,' has helped increase close rates."
Karen Susman, a Denver-based trainer and motivational speaker who works with salespeople, agrees. Web sites can't replace face-to-face interaction, she says. Susman points to the continued importance of trade shows to make her point. When she addressed a group at a trade show sponsored by the American Public Works Association, for example, over 400 vendors showed up with merchandise related to such things as street paving and garbage collection. The members of Susman's audience wanted to see and touch the equipment and materials. "They wanted to feel the gravel," she says.
The paradox of the Internet, according to Susman, is that the more you rely on it as a source of information and goods, the more isolated you can feel. The rise of starbucks as a place to do business is a case in point she says. "People need a sense of neighborhood," Susman says.
They want to hold someone accountable for the performance of the product, and they often need to ask advice on a product and want to buy from someone they trust. "All the things the Internet was supposed to replace, it hasn't," says Susman. "People need people."
This need for the human touch is especially pronounced in the B2B world, according to the Yankee report. There, the sales cycles are longer and include such steps as proposals, quotes, product configuration, customer-specific pricing and lengthy contractual processes. "Until recently, online solutions could not adequately address these more complex selling situations," says the report. While Yankee does say that these technologies are improving, the report's authors conclude that providing customers with the personalized information they need to make a buying decision will more often than not require the involvement of people.
No "strange Duck"
Whether they call the new economy salesperson a "strategic relationship manager" or a "trusted advisor," analysts concur that as the Internet takes over administrative tasks, salespeople are actually being held in higher esteem.
Salespeople used to be viewed as strange ducks, according to Blundon. Veteran salesman and trainer Fee agrees. "Sales used to be the default job," he says. "People would think, ‘I can't be an accountant or an engineer, so I guess I'll go into sales.'" But, he says, "Salespeople now have to understand technology and how business works. They are more important than ever."
The Internet has given customers increased power, too. They can now choose how they will contact a company. And they can get information on a product before meeting with the salesperson. "The new economy is both easier and harder for direct sales," says Blundon. "The challenge is that the customer knows more than the sales force does sometimes. When the salesperson makes a call, the customer often has a sheaf of papers on the product he downloaded from the Internet the night before."
Customers now have a variety of ways to gain access to your company, agrees Tim Caito, managing partner at sales process training company Siebel MultiChannel Services, formerly OnTarget. Salespeople have to manage all those points of contact. "As a salesperson, I don't have to make every call," says Caito. "But I need to know what part of the business goes to the call center or to the channel partner and what part comes to me."
But just because customers can access your company in new ways, that doesn't mean your salespeople are out of a job. A few years ago, when organizations were just starting to create Web sites, the question was, "Will the Web cut down on the call volume in my call center?" According to Caito, studies have proven the opposite of what logic would suggest. Call volume did not go down. "It turned out that increased exposure meant increased need for the human touch," he says. "And the same has been true for the sales force."
What Do They Do?
What do your salespeople do, anyway? According to The Yankee Group, the sales process begins with a prospect and continues until the prospect becomes a customer. The goal is to close the sale. In the traditional sales model, a salesperson takes the prospect through five steps:
• Qualification and Needs Analysis, where the salesperson asks the prospect questions to assess needs
• Product Comparison, where the salesperson narrows product choices to those that meet the customer's needs
• Product Configuration, which tailors products to needs
• Up-Selling and Cross-Selling, which maximizes profits by attracting repeat business
• Quotation, where the salesperson provides the details of the purchase and submits the order
"The sales force is not going away," says Marc Metzner, principal with The Alexander Group, a marketing and sales consulting group based in Scottsdale, Ariz. "But successful companies are refocusing their salespeople on higher value activities." Companies are capital constrained, according to Metzner. Salespeople command high salaries and big commissions. So organizations that can free up a salesperson's time will profit.
To do this, first you need to understand which of your sales force's activities are low-value and which can be best done in the e-channel, says Metzner. Activities like prospecting for and qualifying customers and configuring products according to several "what if" scenarios are examples of things a company might be able to do on the Internet. Billing and quality checks could be handled in a self-serve manner or the customer could get in touch with service directly. "When looking for low-value activities, we are not looking for things that should not be done," says Metzner. "We're looking for things that can be improved in the new media [of the Web]."
Introducing an e-channel will increase a salesperson's selling time from 15 percent to 40 percent or more, says Metzner. So what to do with this freed-up time? Don't get rid of half your sales force, he says, give them new roles. You can invest in sales specialization and focus on certain products or verticals. "For example, if you've never covered the large company market," he says, "now you can start." You can also move customers up-market, making more valuable deals and offering more complex solutions. Or you can penetrate existing accounts further.
This brave new world demands that salespeople master a new set of skills. Tim Caito of Siebel MultiChannel Systems describes three ways of selling: selling product, selling solutions or selling in such a way as to bring higher value to the customer. For salespeople who sell product, the focus is on what they sell. They show up for a meeting with the customer and talk about their stuff. "This is 1970s selling," says Caito, "but it still dominates." This product-centric selling method poses a dilemma for the salesperson, though, he adds. "If I'm selling just a product, the world wants to turn that product into a commodity. That means buying over the Internet, and customers don't need me."
On the other end of the spectrum there is what Caito calls the "trusted advisor" relationship in which the salesperson is listening to customer needs and trying to help the customer enter new markets. "We're seeing polarization," says Caito. "There is a collapse of the middle ground." It's either Web-based selling of commodities with vendors competing on price or value-added selling. There's not much in between. In order to move from an emphasis on selling product to an emphasis on helping the customer, salespeople have to become intimate with their customer's business, according to Caito. "Salespeople need business acumen not product acumen," he says.
"When I started selling in the 1970s," says Caito, "face time, or time in front of the client, was important. My boss would say things like, ‘Why are you in the office at 8 a.m.? You're killing face time.'" Today, Caito says part of a salesperson's "face time" has to be in front of a computer learning about the customer's business. Salespeople have to know what analysts are saying about the customer's industry. They have to keep up with venture capitalists. "If I'm calling on AT&T, for example," says Caito. "I don't talk about how my switch can improve their margins. I need to know the key business issues. I need to know that AT&T isn't even sure it wants to stay in the long-distance market. I need to be ready to talk about VoIP and data centers."
In addition to mastering new business skills, salespeople also have to rethink who they are calling on. Caito's clients are mostly high-tech companies. "Salespeople we work with need to establish creditability with the customer's planners," he says. "Instead of just calling on IT people in their customer companies, they should call on the vice president of marketing or business development. They need to call on people higher in influence."
Your customers won't put the future of their business in your hands unless you're grounded in their industry, says Caito. But very few salespeople are taking the trouble to make sure they have that grounding. "Most salespeople we work with have such a narrow view," he says.
Just a few years ago, the personal relationships forged between salespeople and customers were essential to closing the sale. In the premier issue of this magazine, business guru Harvey Mackay stressed the importance of knowing personal details about your customer so you could send a birthday card or ask about a spouse. The idea was: People buy from people they like.
Is personal selling still important in the new economy? Do companies still buy based on personal relationships?
Not entirely, says Tom Fee. "Thirty years ago, relationship selling was fundamental," says Fee. "Now a lot of other factors enter into the purchase decision." Fee names three factors that influence a sale, of which relationship is just one. Customers buy based on tangibles (like product price, delivery schedule and specifications), intangibles (like the vendor's reputation, brand and financial stability) and finally the relationship (the way a salesperson builds trust).
You may win one sale on price, the next on relationship and the third on financial stability, says Fee. "Selling on only one level is a mistake," he says. "In the old days we sold on friendship. Now no one spends that much time together. Taking a client to dinner or fishing may have an impact, but it won't be the deciding factor."
Caito agrees. "Today's high-performers don't fit the stereotype," he says. "The deal no longer goes to the guy with the hockey tickets in his pocket." Relationship-building skills have evolved to the executive level. "Now," he says, "the deal goes to the person who can gain access to influential executives, and be invited back."