New marketing demystified for Indian SMEs

Archive for the tag “CRM system”

CRM for whom?

Get customers first.  Investment in CRM systems can follow.

CRM softwares are great “farming” tools. The deeper your engagements are till date, the more insights you have in his needs.

Among engagements, the best ones to base your judgement on are the paid ones. So, a customer may have attended seminars and responded to emails and asked for quotes. But, the only time she has actually backed her actions with money is when she has paid money for goods and services. As the electorates vote with their finger on the button, customers vote with their money.

When we target customers for our marketing messages, we tend to rely on profile based targeting. That is, we use information related to her department, seniority, industry, size of the company and so on to tailor messages for her. While this will continue to be used, the need is to make far greater use of behavioral data (related to actions the customer may have taken in the past) to target her. Actions speak louder than words. And, among actions, as I said earlier, actual purchase in the past  is a great validation of what her profile or other behavioral history is leading us to believe.

CRM systems are only as good as the data you log about the customers: their profiles and behaviors and engagements in the past. Their true power is the ability to harness the past data to build compelling marketing campaigns for the installed base. So, couple your investment in CRM systems with robust processes for logging customer interactions and keep the profiles updated. And, ensure you have a sound analytics and reporting engine coupled with your CRM to drive action based on all that data.


Developing an automatic “lead recognition” algorithm

Why automate lead-logging in a CRM system?
We have made the following points repeatedly in this blog:
1. Marketing and sales need to feel that they have joint ownership of the entire business process, from creating awareness in the prospect to generating and capturing prospects’ interest (lead and opportunity) to taking it to close.
2. The primary job of a sales or a marketing guy is not to spend time on the CRM system in use. Their primary focus is the customer and the support systems like the CRM systems should track the customer activities that are relevant to be pursued.
3. A lead happens because of the efforts (some seen and some unseen) of many people in the organization and many activities performed. From the client side, more than one person is involved and their roles in the purchase process need to be logged along with the lead that they influence; preferably automatically.
4. Customer activities are the activities that are more relevant; different activities have different weightages, as any seasoned sales manager will tell you.

A lead is NOT an individual or a contact.
However, a lead arises out of actions taken by one or more contacts working in a buyer organization (account).
There are 2 parts of the lead-scoring algorithm:

(1)     Fitment score: Assigns a score to the appropriateness of the target market, account and contact. For example:
(a)     If your product is primarily sold to the automobile industry (let’s say you make automobile painting machinery), then enquiries received from a related industry (lifts, washing machines) will not have a high score.
(b)     Let’s say you make forklift trucks of capacity appropriate for large structures (100 tonnes or above). If a small building contractor called you, you may give that inquiry very low score.
(c)     If your product is primarily sold after a long evaluation cycle by first working with your customers’ R&D department, then cold inquiries received from the purchase department will get a low score vs a high score if someone from the R&D department made the initial contact.

A fitment score is usually arrived at from the “profile” data of the target account and contact. In the absence of the “Interest score”, this is of use only to determine usefulness for targeting these contacts through marketing activities.

(2)     Interest score: Assigns a score to the logged activities of contacts pertaining to a product/ product category, within an account.

FS:  score of industry  (related to the product/ category) * score of account * score of contact profile

FS is a static score, based on profile of the account and contact related to the particular product/ category.

IS: (Interest score) is the sum of the scores of all activity scores related to a product or product category in a particular account.

For an account, we have to count as lead for a product or product category if IS is greater than a certain threshold provided FS is not less than a certain threshold.

Now, for a lead to be counted, we have to define necessary and sufficient threshold values for both FS and IS. This will most probably vary from company to company and will need to be defined and refined per actual situation and experience.
Some definitions:

Activity: Something that the customer does which we log into our system. Each activity is pre-defined and has a value assigned in our system.

Campaign activity: Activity initiated (typically by marketing department of company) targeting multiple contacts over multiple accounts to get them interested in a product or product category.

Sales activity: Direct contact by sales executive or his boss with any contact in an account.

Why activity value: A customer through his actions demonstrates his propensity to buy. It is rarely one action, but many actions which add up to a strong “buying signal”. There are activities, as experienced sales managers know, which are strong buying signals and there are those which are weak or even negative buying signals. In real life, if a customer sends a lot of signals, then the probability of a deal is high. So, we assign values to significant activities undertaken by the contacts.

Relative weightage of activities: Customer activities have normally more weightage than any activity done by us. However, there could be some activities done by sales which may have overriding weightage.

What do you think? Makes sense?

Functionality for a Marketing and Sales Management system

.. a comprehensive feature-set minus the fluff for B2B market

It is important to nail the lie at the outset that more information makes for better decision making or, by definition a better management of your sales and marketing operations. Information is of no use, unless it is current and easily actionable. Your ability to take action on information or insight is not trivial. If as a Small or even Medium sized enterprise, you do not have the resources (people, money, collaterals..) to pursue opportunities that are surfaced from customer data, then what good is that data to you?

I set out to define the marketing to sales continuum for small to medium companies and this is what I came up with.

Sales cycle mapped to communication strategy and media

Sales cycle mapped to communication strategy and media

Notice the megaphone mnemonics; one at the top left hand corner and the other at the top of the box called “existing installed base”. The one on top left corner signifies broad “outreach” campaigns, mostly limited to mass media like advertising (on web as well as paper), tradeshows and social media initiatives. The aim at this stage is to get the uninterested folks interested enough to permit one to one engagement. The megaphone at the top of the “existing installed base” signifies the enormous power of using loyal customer testimony to get the dis-interested or the fence-sitters make up their minds in our favour.

The SME segment of the B2B market will need a system that not only logs each stage of the sales cycle and its “participants” (the “contacts” working in various capacities for customer “accounts”) but, also makes possible the delivery of many of the communication activities and reporting and analytics from the same integrated platform. Such systems exist; primarily delivered over SAAS. But, while not as expensive or complex as many of the traditional desktop versions deployed within large enterprises; these still end up costing a lot more than what most SMEs are expecting to pay.

Simplicity of use (minus the large workflows that are designed into many available systems today), affordability (certainly much less than, comprehensive feature set and ease of configuration are what SMEs are looking to get. Salesgenie CRM++

A better way to recognise “leads” in CRM

… why we need to re-define “leads”

In most common CRM systems, a lead is what marketing produces for its labor and a deal is what the sales guys make or chase. The system treats them differently.

If this is your worldview as a B2B marketer, be ready for strife, disagreement and worse across the great sales-marketing divide.

First up, let us agree on a few things:

Sales-guys may be rock-stars but, they could not do much without the company, its products and the reputation that precedes them. And, we like to think of sales as a linear process, with customer moving from a stage of low awareness to high engagement and making the transition from being hand-held by marketing to sales.

Worse, when a “lead” is exclusively “tainted” with the marketing origin, sales do not take it seriously. When faced with a lead-inbox full to the brim on a Monday morning, the impulse of the sales executive is to do one of the following:

1. Trash the lot

2. Scan through the lot and mark most as useless and the rest as “already existing in the system”.

Sales leads are a result of many factors (company brand name, past experience and purchases) and activities undertaken to make the customer aware of our products and services. In B2B scenarios, sales and marketing both have a role to play.

Why not recognize that?

There is a reason. Over a period of time, B2B marketing departments, under pressure to justify their existence, have bought into a metrics system that recognizes only “lead generation” from marketing campaigns as a measure of success.

So, marketing is eager to tag every little sneeze from the customers as a lead and ascribe that to the cold they caught from the aircon running in their own office. This has led to the exact opposite of what was intended. The more numerous marketing leads have become, the less useful they are.

We define a lead as a signal coming from a buyer organization which needs follow up. A lead, upon qualification can become an identified opportunity for a sale.

A lead is NOT an individual. However, a lead arises out of actions taken by one or more contacts working in a buyer organization (account).
In this view,
1. A lead transforms into a deal
2. We recognize that many activities jointly contribute to creating a lead. It is no longer  “we ran a seminar and we got 200 leads”. Now it is more like “we have logged customer activities (attending a seminar, asking for literature, asking for a salesman’s visit or wanting to see a product for evaluation purposes) all showing interest in a certain product/ product category of ours in the past month. Something is happening here; let’s have our sales guy investigate.”

A CRM system’s job is to log activities. A lead should be created automatically as an aggregation of those activities related to a certain product or class of products.

Involve sales managers in scoring the activities that make a lead, and communicate to the sales that each lead is recorded because of multiple validations from  activities. I expect this process will be a winner.

What do you think?

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