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Wednesday, 2 November 2011

How do you lose market share, with the best product and best price?

 

It’s easy, give Marketing control over Customer Relationships.

market shareI have just finished a long assessment for Big IT, they told me to find a problem with Sales.

I did, they were losing deals to a ‘softer’ product and the customer was paying the same or even more.

When I made my initial report, they asked me to recommend a “Sales Training”. I could have said anything. But, I replied that I knew what was wrong, but we didn’t know what caused the problem.

They agreed reluctantly to fund some more Sales Consultancy, but they really wanted “Sales Training”, a good two day event that would ‘energise’ the sales force and bring the lost business back!

 

 

My role as a Sales Consultant is to eliminate mistakes.

That is it. Simple!

Find the mistake, then eliminate it.

At BMAC we call it “error detection and error recovery”.
(At least one of us used to design, test and repair Hard Disk drives).

If YOU are not doing something wrong (or not doing something right) then your business would be booming!

At big IT, we did the usual lost business reviews,
with some remarkable and consistent results across a wide range of
Salespeople, Customers, Customer Segments and Geography.

· Did we lose on Price – NO?

· Did we lose on Product – NO?

 

We drilled down, what was the price difference, little or none.

What was the product difference little or none.

Several (sincere) Lost Customers, even admitted that they had bought more expensively and
they believed the product that they bought although good enough may not be as good as Big IT’s.

So WHY did we lose? We asked. It came down to RELATIONSHIPS.

Over the last three years Marketing has taken over ‘Customer Relationships’. Marketing were responding to incoming queries and contacting “quiet” Customers. Sales were told to focus on ‘Closing deals’.

“Show the Prospect that we have the best Product and the Best price”.

CRM reportaMarketing had installed, at great expense, a new CRM. It collated web landing, Social Media searches, recorded incoming and out-going telephone contacts and had hounded Sales for their “Black Contact Books” to be put in the system. The initial results were great; the sales ‘lag time’ had dropped from entry in the pipeline to Order from 7 months to 4 months. Sales were only working ‘qualified’ leads. Marketing was holding ‘pre-qualified’ leads and “nurturing” them.

So, what was wrong? Where is the error?

The Customers had interpreted Marketing’s new CRM approach as:
We are Not Interested.”

 

 

 

 

The Customer wanted Sales Engagement!

So, they got it from the “interested” Competition.

 

Interesting?

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