In complex B2B sales, people still buy from people. I don’t want to give the impression that ‘Closing’ has gone away. It’s still extremely important, and the people who are ‘Closers’ are extremely valuable. More about this later.

Sales 2.0 merges Sales and Marketing to target prospects more effectively, using online technologies in innovative ways, to bring in more business at a significantly lower cost of sales. Information is available free (or close to it) today that you couldn’t buy for any amount of money five years ago.

Now we can find highly specific target prospects much more easily, AND we don’t have to interrupt them while they’re trying to do something else. Outbound sales messages, when they’re done via phone or even in person, are analogous to interruptive advertising. An Alterian poll determined that in 2009, 95% of advertising was ignored or disbelieved by its target audience. The old saw was that 50% of advertising didn’t work… you just didn’t know which 50%. Today, you can rest assured that 95% of advertising spend is wasted.

How do you build trust when your prospects won’t engage with you? Today’s B2B buyers want to engage in conversation where and when it’s convenient for them. That means social media. It’s not expensive, but it’s not free. It takes time and effort, knowledge and finesse. Increasingly, Sales and Marketing people are going to have to immerse themselves in social media (or hire a trusted resource) to do demand generation, lead nurturing and to build relationships… albeit digital relationships.

Now we get back to the ‘Closers’ I mentioned earlier. In B2B they’re essential, and they’re expensive. You don’t want them (and they wouldn’t do it anyway) spending time writing blogs, Tweeting, and trolling Discussion Groups on LinkedIn. The good news is they don’t have to. Once a digital relationship is established with a prospect, and the lead is qualified, whoever is handling social media for you should turn the realtionship/lead over to one of your closers. (You have at least one, or you wouldn’t be in business.) When the prospect is nearing a buy decision, they will want to speak with a sales person.

If the Sales 2.0/Marketing operation has done its job correctly, that face to face conversation won’t be focused exclusively on price. Your closer can spend their time and energy developing a personal relationship… and closing a profitable deal.

This is the first post in a series about B2B Sales 2.0. The next one will be titled ‘Sales 2.0 is Sales Enablement’.

Social media and search have irreversibly merged the worlds of Sales and Marketing. Where marketing messages and sales relationship building begin and end is a moving target. So SMB IT providers must adopt a new set of marketing-related behaviors to thrive in this new environment.

Selling evolved long ago from an act of presenting and closing, to one of educating and consulting; but access to information via online sources (rating sites, filtering social media streams, and tools for competitive analysis) has changed the game.

Over the past five years B2B buyers have learned to research online. They don’t want to see or talk to a salesperson until they’re nearing a buy decision. That means Marketing, specifically online marketing, must create demand, nurture leads and keep them engaged until they’re ready for Sales.

Some businesses are attempting to meet this challenge by expecting salespeople to learn the ins and outs of the internet as a sales enabler, while also carrying a quota, building relationships, managing accounts and internal resources, upselling current customers, and prospecting! That’s a great way to set your salespeople up for failure.

My clients – SMB (20 to 100 employee) IT providers (hardware, software and/or services) have been evolving and they need to continue to do so. My experience with them (MSPs, SIs, VARs), is that they’ve been struggling to transition from a direct sales model to a model that better fits how their prospects want to buy.

SMB IT providers are still trying to get their web channel aligned (if they even understand that the web is their de facto channel to market). Now there’s another paradigm shift; and that’s social media. There’s the added challenge of figuring out how to reach prospects through blogs, LinkedIn, paid search, personalized email, and the new question burning up Twitter today – should we buy promoted tweets?

I want to draw an analogy here to earlier forms of media. Books were invented hundreds of years ago and they’re still going strong. Newspapers and magazines were invented later, and they’re still here, maybe not so strong. Radio is still here. So are movies and TV.

With each paradigm shift, the old way wasn’t destroyed, it was added to. That’s the situation with SMB IT providers – there’s still basic selling of boxes going on and that will continue, but there’s no margin in it. There’s still consultative selling of solutions going on, and that will continue, but now the prospect is in the driver’s seat and margins are under pressure. Effective Marketing (content marketing, inbound marketing, online marketing, social media marketing) can reduce the Cost of Sales and help IT providers to maintain margins.

There are no more blind dates. Your prospects can learn just about all there is to know re your company, your products and services, and your personnel. Some of my clients say, “Then let’s not tell them. Let’s leave that information off our website. Let’s not participate in social media. Then they’ll have to speak to our salespeople.” I disagree… vehemently. No SMB IT provider is selling any solution that prospects can’t find elsewhere. If your site doesn’t contain the relevant and useful information that people need to make an informed decision, you’ve already lost the sale.

In order to beat the competition, you need to be playing the social media game, and you need to do it well. There’s a misconception that social media is free. The platforms typically are free. Using them effectively takes time, knowledge (platform knowledge, but also business and people knowledge), and a well thought through strategy.

I have a client who asked me to help him find a recent college grad to do his company’s social media marketing. He figured that there are plenty of recent grads looking for work and they understand this social networking stuff. We couldn’t find anybody. There were plenty of applicants, just nobody capable. They didn’t understand business. They couldn’t discern what was appropriate communication, and what was not. They didn’t know the industry. When a client or prospect engaged them online, they didn’t comprehend the context of the message. They couldn’t reply in a meaningful way.

Social media is conversation. You need to make sure your end of that conversation is interesting, knowledgeable, relevant and courteous.

Social media presents a gigantic opportunity for SMBs. You can engage your prospects where they’re already congregating online, build credibility in your expertise, and (over time) gently persuade them to purchase from you. This takes both Sales and Marketing participation (and cooperation), time, effort, some money, planning, and a willingness to develop processes. It takes a concerted effort over time and across platforms. The payback is orders of magnitude greater than the Sales and Marketing ROI you’re used to.

Complex, high-ticket B2B solutions have long sales cycles. If you have a qualified lead (they have the need, budget and authority), keep them engaged and nurtured. There are right and wrong ways to do this. I’ve seen clients waste time and money on what they think are ‘nurturing’ activities, only to end up with annoyed, tuned-out prospects.

Here’s my list of Lead Torture vs. Lead Nurture:

Lead Torture – calling leads just to ‘touch base’ (“Are you ready to buy yet? I need to make my quota.”). Lead Nurture – calling leads when you have something to talk about, something that is of interest to that individual. Having a valid business reason to make the call.

Lead Torture - Tweets about mundane or arcane (too techie) matters; salesy, obviously self-serving Answers and Discussions on LinkedIn; invitations to become a fan of your company page on Facebook. Lead Nurture - a thought through, coordinated social media plan that has an objective, is congruent across platforms, and consistently delivers interesting, meaningful and/or entertaining information.

Lead Torture – sending the same, tired brochure (or case study or white paper) over and over again. Lead Nurture – sending new, relevant and useful information on a regular basis (blogs are a great way to accomplish this AND improve your SEO at the same time).

Lead Torture – sending weekly emails, written by whichever technician wasn’t billed out at the time, containing technology feature dumps. Lead Nurture - sending a weekly email that curates news items from the Net; items that are of interest because they’re related to that prospect’s industry, business role, etc.

If you’re going to do it, do it right. Otherwise you’re training your leads to dismiss your messaging and your company.

I agree with Jill. That may seem to be an odd stance for a guy who makes his living developing marketing collateral and sales tools, but it isn’t really.

Today people won’t agree to a meeting with a sales person unless:

1. they feel you have a solution to a business problem they’re experiencing, and
2. they’ve already checked out your website, read your company blog, and researched your executives on LinkedIn.

I’ve been there, so I know that hard copy collateral can be a crutch for sales people… especially young or inexperienced ones. It used to be that the collateral was necessary. Prospects had no other way to learn about complex B2B products and services. Those days are gone. Make sure your website is filled with high quality content that is relevant and useful to your clients and prospects; and keep adding content so people have a reason to return to your site.

Focus on developing relationships when you meet with clients. You’ll close more business. Don’t go in totally naked, though… I recommend you wear a smile.

Here’s Jill’s blog post Naked Selling.

My research opened my eyes. There are several different forces at work that make the valuation of an MSP business a dynamic process. How MSPs are valued is changing, and I was able to say, “Yes,” to my client.

Here’s what I found. The preeminent expert in this space is Charles Weaver. He’s the President of the MSP Alliance, and of a consulting group that specializes in MSP mergers and acquisitions. I exchanged a few emails with Charles. His position is that MSP valuations used to focus on annual profits. The purchaser would ask to see the books. They valued the business more if it could show a year over year improvement in net profits, and they would pay a multiple of last year’s net.

This profit metric led to MSPs choking off investment in the business for a couple of years prior to sale to pump up the size of their profits and, therefore, the selling price. Purchasers were paying top dollar for a business in decline, and they had to invest heavily to get it back into growth mode.

So the metrics changed. Instead of looking just at profits, potential acquirers also looked at the book of business. They reviewed the number of current contracts and their future value in order to get a better idea of future profits. So MSPs who were contemplating cashing out focused on signing clients to multi-year contracts. Charles feels that this is also a less than optimal valuation method. He thinks it’s actually unfair to the seller because there are many sources of non-recurring revenue that should be included. His preferred calculation method is to blend top line revenue and EBITDA.

According to Joe Panettieri, the ‘VAR Guy’ and President of MSPmentor, “effective Marketing, Sales and Consulting are the three basic criteria for long-term MSP success and maximum company valuation… the most successful MSPs have processes in place to work on social media, marketing and PR on an ongoing basis.”

What Joe is saying is that having processes in place to handle Marketing and PR functions delivers three positive influences on valuation:

1. they indicate a willingness on the part of the business’ management to build and deploy infrastructure devoted to demand generation and lead nurturing (critical sales enablement ingredients when selling complex B2B services),
2. they accrue sales assets, which are tools that accelerate and amplify the sales process, and
3. they result in company and brand visibility in the geographies served and across the online world.

Marketing is not a one and done kind of thing. Like Sales and Consulting, it’s an ongoing process that needs to be worked on all the time. Especially today when everyone is dealing with ’short attention span prospects’. Fresh, relevant and useful content is needed on websites and for social media platforms. You have to give prospects a reason to keep coming back (i.e. new information that educates and gently persuades), until they’re ready and willing to sit down with a salesperson.

So how do I help my client pump up the valuation of his business? By doing the same things I do with all my clients… get them to:

• focus on Marketing as a strategic part of their business;
• stop doing ‘promotional activities’ on an ad hoc, opportunistic, haphazard basis;
• plan, budget and execute Marketing functions just as they do with Consulting and Sales functions.

When B2B purchasers were seeking potential new suppliers, Twitter and blogs were considered  more influential sources of supplier information than any other channel, including word of mouth, seminars and industry press.

However, the most popular sources of information remain web searches and supplier websites. In fact, when asked how their information gathering behavior had changed, procurement professionals cited the greatest increased use of web searches (up 64%) and supplier websites (up 61%). Social networking sites Facebook and Twitter experienced 6% and 10% net increases respectively, and LinkedIn saw growth of 19%. Online videos/webinars/podcasts were also a strong source of information with an increase in usage of 36% – that coming off a small base, though.

Relevant, useful, interesting… even entertaining copy is no longer enough to hold the interest of harried, starved for time, inundated with information business prospects. I’ve spent a lot of time and effort researching and building a process to develop multimedia storyboards that can deliver a significant amount of information in a short amount of time. The idea is to use sight and sound simultaneously to compress the amount of time, and increase the ease, in which information is communicated.

You’re thinking, “Wow, Bob. Alert the media. Ever hear of television or the movies?”

This process might include video, but it doesn’t have to, and it’s designed to be deliverable at less cost, with less equipment, and less prep time than video. It’s designed to fit the budgets of my clients. It’s untried, though.

So, I’ve been thinking about how to launch it. I first vetted the idea with friends, colleagues and clients over the holidays. Then I submitted discussions to a half dozen groups on LinkedIn. I was surprised at the response. Many smart, talented, creative professionals joined in the discussions. The consensus was, if I can pull it off, it’s a winner.

Then I went to three online custom publishers I have a relationship with. They were positive. They all said the same thing, they can sell it, IF I can pull it off. So now it’s time to develop a proof of concept and get feedback.

I’ve built a prototype with a voice over script, some on screen text, and a story told in cartoon format (with my crude stick figure drawings). I realized I needed a professional cartoonist to do the eight or nine frames necessary to tell the visual part of the story. So I’m using iFreelance and contacting other cartoonists I found on LinkedIn and through graphic designers I know.

So stay tuned. I’m going to blog about the process as I reveal the proof of concept online, try to build buzz via social media, and crowdsource tweaks to the process/product to improve it. By the way, one of the outcomes of the discussions on LinkedIn is a name for the product: acStream.

Should be interesting.

Alas, you’re not Apple, and I’m not Steve Jobs. That doesn’t mean we can’t pull off highly successful product launches, though.

Due to the tools we have available today, the research phase (which is an absolute must) can be combined with test marketing and some early promotion of the product.

The problem in developing successful new products is not a shortage of ideas, but the expense of bringing a new product to market without any guarantee of success. How much better to continually seek feedback from prospects along the way, and fine tune the product so you know it’s going to be a winner.

Research, Research, Research

Social media platforms like LinkedIn and Twitter constitute mind-boggling tools for accomplishing research on the fly with built-in feedback loops, and rock bottom pricing. Five years ago you’d have to pay tens or even hundreds of thousands of dollars for the information you can get at virtually zero cost today. Here’s the process:

1. Determine who your best target customers are. “Everybody” is not an acceptable answer. Be as specific as possible. The better you know who you’re selling to, the better you can custom fit your product, and the more persuasive your marketing messages can be.
2. Determine how you want to go to market. Are you going to produce the product in-house or outsource the production? Will you sell the product yourself or through resellers? If you’re going the partner route, thoroughly research potential partners to determine best fit.
3. Market Research Phase:
   a. Research market size and potential.
   b. Interview end users, resellers and sales reps (you can do this via online polls on LinkedIn and Twitter, although you should also conduct some qualitative, in-depth interviews in person or over the phone).
4. Analysis and Development of the Marketing Plan:
   a. Competitive Analysis – review competing products and how they stack up against your proposed product. If there aren’t any closely competing products, research how else people are solving the problem. If they aren’t solving the problem and they’re not suffering any pain, pull the plug. If they are suffering, but don’t realize they have a problem, you need to add in the overhead cost required to educate them.
   b. Evaluate the product’s Strengths, Weaknesses, Opportunities and Threats (SWOT). Develop a Proof of Concept so people can understand what it is and what it does. It’s OK to use smoke and mirrors, as long as you can build the real functionality when the time comes.
   c. Develop an Online Marketing Plan that leverages the unique capabilities of the Net. Successful online launches create a series of interactions with current customers, employees, prospects, suppliers, trade media, resellers and any other appropriate audiences.
5. Execute the Plan and Launch the Product:
   a. Develop online (easily and inexpensively edited) collateral materials.
   b. Begin placement dialogues with the first step in the preferred channel.
   c. Have enough dialogues with enough different entities to uncover any previously undiscovered objections.
   d. Review and revise the Plan as necessary with the new information.
   e. Repeat until you’re satisfied you have market acceptance.
   f. Explore relationship extensions with partners.

I’ll come out with more details in shorter blog posts over the next several days.

1. traditional, interruptive advertising was no longer effective, and
2. traditional presales activities (educating prospects about your solutions) had been replaced by Google.

Largely due to the efforts of others, like Joe Pulizzi and Newt Barrett; and to the overwhelming evidence in the market place, my prospects now understand #1 and 2 above. So what’s next?

The Content, Connection, Conversation, Conversion Continuum

We all agree that to engage prospects we need to produce and publish relevant, useful, interesting and valuable content. You can’t just put it out there anymore, though. There’s too much competition for peoples’ attention.

We need to connect the content to our prospects. That means we have to deliver it to the online places where they hang out. That might be at industry-related websites like MSPmentor, or on special interest groups within Facebook, LinkedIn and Twitter.

Once you’ve set your content at the feet of the people it was developed for, if you’ve made the content compelling enough, your prospects connect with you. You’ve piqued their interest and they want to learn more… or they want to voice their opinion. They will comment on a blog post, in your online discussion, or they’ll email you.

Conversation ensues.  When a dialogue is created between you and your prospects, ideas are exchanged. This is the time to listen carefully. It’s a golden opportunity to find out exactly what prospects want. Let them tell you. If they feel they’ve been heard, trust is built.

Once they understand that you truly have their best interest at heart, the conversation will move from online to phone, and then face to face, as the topics move from features and benefits, to pricing, and to terms and conditions. The prospect converts into a customer. You close a profitable deal without selling anything.

Marketing
The 00’ decade began the transition to the mantra “marketing is the enterprise.” In the 10’ decade, marketing will be the most important factor in business success. No offense to sales-driven companies, but marketing is the central nervous system of the enterprise in the new decade. And, the cardiovascular system is communications. The marketing strategy is now all about the experience. Customers live in a digitally connected world at home, in the car, on the bus, at work, even at their kid’s soccer games. Brands who give their customers opportunities to experience their value proposition will win loyalty. Some B2B brands that do this already include Cisco, Indium Corp. and HubSpot. The secret sauce to creating an experience is to experiment with different communications that touch people through more than one sense including sight, sound, smell, taste, touch. Yes, even B2B brands can do this.

I’m not so sure about smell, taste and touch; but it’s apparent that multimedia (graphics, images, and sounds along with short bits of text) will increasingly become the lingua franca of the web. As for Marketing’s ascendancy, I think most everybody in the business world realizes that ‘order taker’ salespeople have been disintermediated by the internet. But for complex B2B products and services, sales people are still very much needed. Their roles, though, should be upgraded and focused. ‘Beating the bushes’, ‘cold calling’, ‘hunting’… whatever you call it, is less and less effective. Marketing’s role is growing through the addition of what I call ’sales enablement’ activities. These are primarily online pull tactics (including inbound marketing, content marketing, SEO and social media). The upside for professional B2B sales executives is that they get to focus their time and attention on building relationships and closing profitable deals.

You can read the rest of Bernie’s Predictions here.