Larry Caretsky, Commence CEO, has released the white paper “Don’t Let Quality Leads Slip Away: Executive Takes Action with CRM Software.”
Here’s an excerpt including the introduction and you can download the full white paper below:
“As a sales executive of a computer software firm, I became consistently frustrated when comparing the number of leads that we generated every quarter to the number of new business opportunities we closed. Something just didn’t add up so I decided to dig into this and find out what was going on…
The project was driven by our internal requirements and the frustration shared by so many executives I had interviewed who were looking to address this business challenge.”
Click to view or download the full CRM Whitepaper.
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Including CRM in your sales cycle is a smart business strategy
In part one of this paper, we discussed how critically important it is to select a sales model that is appropriate for the products or services you are selling. In our case study the ‘NewCo’ company needed to transition from a high cost direct sales organization to selling via the internet and channel partners.
The second and equally important strategy to ensuring good sales execution is to implement a structured sales process or methodology that standardizes how you sell. This is important for two reasons.
1. Simplified Sales Management
First, you cannot manage and properly direct your sales team if every representative has a different approach to selling. Remember sales people traditionally come from all walks of life – from teachers, accountants and engineers to college students just entering the work force. Unless you establish a specific sales training program every member of your team is going to conduct their business according to what they feel is right. Using this approach some will perform better than others will. However, one thing is clear you will not have a uniform approach to selling.
This is something many companies continue to struggle with. CRM systems do an excellent job of providing structure for companies that don’t have one, or are unsure what theirs should look like. This is not rocket science. Start by outlining the steps that occur during your sales process. The steps will vary from business to business, and the number of steps depends on the length of your sales cycle.
What are the steps in your sales cycle?
For example, the sales cycle typically begins with qualification or a needs analysis. This ensures the new opportunity is real, and that the prospect has a need for your company’s product or service, and the budget to pay for it. Next step may be a product demonstration, followed by a quote, a trial of the product, verbal agreement then closure.
2. Consistent Sales Forecasting
The benefit here is clear. Having a definitive sales process such as this allows management to see a snapshot of every new sales opportunity. If you are managing every new sales opportunity in a structured fashion, you know where each one is in the sales process and what is required to close the sale. This leads to highly accurate monthly and quarterly sales forecasts.
Using a set of pre-built analytical reports sales management can follow each opportunity through the pipeline and take a proactive approach to help win the sale.
Graphical and spreadsheet view of sales by stage
About the author:
Larry Caretsky is president of Commence Corporation a leading provider of online CRM software. Caretsky has more than 30 years of experience in the client management software industry and has written numerous white papers on the subject along with an eBook “Practices That Pay”. He leads a consulting team that assists small to mid-size businesses implement best practices for sales execution and sales performance.
Image “Businessman With Idea Lightbulb” courtesy of Nutdanai Apikhomboonwaroot/FreeDigitalPhotos.net
Image “5 Steps” courtesy of samuiblue/FreeDigitalPhotos.net
Internet marketing experts estimate that at any given time only a fraction of the market is interested in the product or service you are selling. The problem is if you don’t know who they are or when they plan on buying, how can you earn their business? Here are some things you can and need to do.
1. Implement a marketing strategy using a lead nurturing system
What I am referring to here is a series of direct or e-mail campaigns that serve one purpose, and that is to ensure that your company, your product and the value you offer is consistently in front of potential customers for months on end. Marketing people refer to this as “the rule of seven” which simply means that people may not recognize your offering until they see it seven times. So many companies make the mistake of sending a single message. If the prospect does not respond they move to a new list, convinced the first one was no good.
2. Make sure your message delivers value to the prospect
Stop selling for a minute. Special holiday discounts or offers for “free anything” don’t make sense. In fact they can irritate the buyer. I get these all the time; buy now and get 50% off. I don’t even know what they are selling so why would I have any interest – discount or no discount. Instead offer something you would have an interest in reading. If you wouldn’t click on it why would you expect a prospect to?
3. Try to differentiate yourself from your competition
Some people call this “thought leadership” which is nothing but a fancy title for being smarter than your competition. Present ideas that are outside the box, ideas that inspire creative thinking for both you and the potential prospect. If your message is educational or intriguing and gets them to think about what they read, chances are they will remember you.
4. Don’t stop marketing
People seem to think marketing is a part time job. Send a mailer and you are done. It’s not. Let’s go back to what we said earlier – You may not know the right time when a prospect will decide to buy, but as long as your product and service is consistently in front of them you can bet that when they do decide to buy you will be on the call list.
Creating an automated marketing program without the proper tools can be quite the challenge. The good news is that there are several very good CRM software programs that can automate this process and make life easy for you. In part two of this paper, I will discuss the automation process and how CRM software has matured and is delivering value for marketing professionals.
This article is sponsored by Commence Corporation, a leading provider of web based CRM software.
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According to industry reports…
More than 41% of all small to mid-sized U.S. businesses reported that their sales and marketing efforts fell short of achieving their Q1 revenue goals.
“This is nothing new.” says Larry Caretsky, president of CRM solution provider Commence Corporation. “I think the biggest challenge facing small to mid-size companies today is dealing with the evolution of how products and services are sold today. The Internet has created an on-demand mentality for all kinds of products and services – products that were once sold by professional sales people, either face to face or via the telephone. While the bigger guys have adapted to this new sales paradigm, many small to mid-size companies are trapped in old school thinking. They tend to stay with what they have done for years even though it is no longer working.”
Let’s look at an example.
THE GOAL The ‘NewCo’ company sells sales management software and consulting services to mid-market companies via a direct sales team. They have an average sales goal of $20,000 to $30,000 per customer – not huge but enough to cover the cost of sales salaries, commissions, and overhead and still make a profit.
THE CHALLENGE Over the past 5-7 years, the industry has changed substantially and has become even more competitive. Web based programs can be deployed via a cloud-computing environment, and require no hardware or software. The competition’s software is available over the internet at a fraction of the cost of NewCo’s original sales software.
THE STRATEGY NewCo responds with a new web based offering of their own at a competitive price, and retains their highly skilled sales team as their only sales channel.
THE RESULTS While they are winning sales, they are losing money on every one. Why? Because their cost per sale is simply too high. Competitors are selling their products over the internet using lower cost telesales representatives. If NewCo doesn’t find a way to reduce costs and improve their efficiency they will likely be out of business.
There are three selling models to consider (excluding retails sales).
- Direct Sales – a well-trained in-house sales team employed by you
- Channel Sales – third party companies that sell your product or service based on a percentage of revenue or business they close
- Internet Sales – low cost telesales staff that simply process orders or assist customers with the order process
Of course, you can have a combination of the above. Your decision with regard to which one(s) are most appropriate for your business will be based on the overall cost of your product, the cost associated with selling the product (i.e. , salaries and commissions) and your margin or profitability on each sale.
In NewCo’s case, it is clear that relying solely on direct sales will no longer work for their business, but perhaps adding a telesales team with some regional channel partners will.
The world has changed, industries change and you have to be willing to change with it. It’s that simple.
Meeting your quarterly or annual marketing and sales objectives is not as simple as just adapting to the right sales paradigm. This is critical, but the next step in the road to success has to do with implementing the proper sales structure and process. I will discuss this in part two of this whitepaper – “Using CRM to Leverage Sales”.
About the author:
Larry Caretsky is president of Commence Corporation a leading provider of online CRM software. Caretsky has more than 30 years of experience in the client management software industry and has written numerous whitepapers on the subject along with an eBook “Practices That Pay”. He leads a consulting team that assists small to mid-size businesses implement best practices for sales execution and sales performance.
Image “Money With Magnifying Glass” courtesy of Sujin Jetkasettakorn at FreeDigitalPhotos.net
Small businesses have the same challenges as larger firms. They want to improve how they market, sell and provide service to their customers, and they want to use CRM technology to gain an edge over their competition. Where they differ however is how they evaluate and purchase the products and services that can help them to achieve this goal.
Larger firms that have definitive roles within their organization such as a sales, marketing and customer service department spend time documenting their business requirements and traditionally provide these to the CRM vendors they are evaluating. This may include functional requirements as well as the need for professional services. For these businesses it is imperative that the CRM vendor respond to which requirements they can meet and those they cannot. These firms look at each CRM solution provider as a potential long term partner in their business and make their decision based on numerous criteria such as:
- the product’s ability to meet the majority or all of their functional requirements,
- the company’s track record for successful implementations,
- training programs that are available to reduce the learning curve,
- the company’s data hosting services,
- system reliability and up time performance,
- the support services that are available after the sale,
- and of course price.
Many smaller businesses, particularly those that do not have definitive roles, tend to overlook these criteria and look at the acquisition of a CRM system as a simple transaction based primarily on price. It is easy to appreciate why this would occur. If you have not documented specific requirements for your business you have no way to differentiate one CRM vendor from another. As a result, they all look the same – almost like a commodity.
CRM is not a Transactional Sale
CRM should not be viewed as a transactional sale. You are not buying a television or DVD player here. You’re buying a business solution that you should expect will help you become a more efficient sales and service organization for years to come. This simply means you need to take the time to document where you are as a business today, and where you want to be. For example, what improvements do you want to make to your sales, marketing and customer service operations? Then share those with the CRM solution providers you believe can meet your requirements within your budget.
Your list of functional criteria should also include any services that you think you may require to fill a gap that you may have internally. Smaller businesses for example often have limited resources in the marketing area. If you plan to improve lead generation via bulk e-mail programs and do not have the staff to do it perhaps the CRM vendor can play this role and assist you with the creation of professional mailers.
The array of services a CRM vendor can provide can often be clear differentiators between one company and another, helping to make your selection easier. The point here is clear. You do not have to document every change you wish to make and every feature you want to see in a CRM solution, but don’t go into the process blindly. Taking the time to document your needs before you make a decision will significantly improve your chances of realizing a high return on your investment.
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As an executive of a company servicing the Customer Relationship Management software sector, CRM has become a bit of an oxymoron for me. I believe that building long term business relationships with your customers requires a commitment to providing quality products and great customer service. This traditionally involves reaching out to your customers and engaging with them so that they realize the maximum value from your product.
But many small to mid-size companies and CRM vendors that service the SMB sector just don’t see it this way. The vendors prefer that you just buy their product over the internet. If you need assistance send an e-mail and they will get back to you when it’s convenient for them. The buyers seem to feel comfortable with this and often hold the position that if I need assistance using your product, then it’s too hard so I’m not interested. It’s almost as if they view CRM software as nothing more than a commodity.
Your CRM Success Needs Your Commitment
Interestingly enough industry reports have indicated that there is as much as a 70% failure rate among CRM implementations. This is far worse than any other segment of the software industry. Much of this occurs in the SMB space where companies never get off the ground and as a result discontinue the service.
You could place the blame on the CRM software providers for developing products that are too hard to use; or perhaps the management of the company that purchased the system for failing to properly match their business requirement with the vendor’s offering or assign a champion who’s in charge of the CRM system. I blame the management and here’s why.
The CRM sector is crowded and highly competitive, with several hundred solutions ranging in price from free to more than $200 dollars per user per month. Most of the offerings targeted at the SME sector offer basic functionality and as such are very easy to use so this is not the problem. Furthermore, they are designed to offer limited to no customization so that the customer can’t get themselves in too much trouble. This is because with price points of free to $15 per user per month the vendor cannot afford to hire the resources to provide customer service. So when you see CRM products offered for free — no contract, or go month-to-month with no commitment, they mean it.
The real problem lies with the management of these small to mid-size businesses that have limited resources, are stretched thin and often do not understand that in order to improve how they market, sell and provide service to their customers they have to do more than download a cheap piece of software over the Internet. This commodity mentality is what I believe has led to the high failure rate in the industry. So how does this change?
Successfully Implementing Your CRM Solution
First, the management needs to agree that No Commitment – Means No Results. The first task is to make a commitment to put someone in charge of the CRM process. A champion who will document the business challenges such as ‘we need to improve lead generation‘. Then focus on finding a CRM solution that will address these challenges and a CRM vendor who can provide advice, counsel or value added services that will ensure results.
CRM is a two way street and you need to feel comfortable that the vendor has the staff and experience to make a commitment to your success. As I stated earlier you won’t get this by putting your credit card over the internet. This does not mean you have to mortgage the business to find a quality product and company that can deliver both at an affordable price. There are several good ones and you may be surprised to find out that the difference between a low cost CRM product and a CRM solution provider offering the value added services you need may be less than you think.
About the Author:
Larry Caretsky is President of Commence Corporation, a leading provider of online CRM software for small to mid-size businesses. Caretsky is considered an expert in the field and has written numerous white papers on the subject and the book, Practices That Pay – Leveraging Information to Achieve Selling Results. All are available from the company’s web site at www.commence.com
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Small businesses often struggle with how they manage and execute their marketing message, lead generation programs and sales opportunity management. This is because they typically do not have the expertise on board to implement or automate the internal business processes that drive these requirements. What’s worse is that many believe that the mere purchase of a good CRM software program will fix the problem; then later learn that it won’t. Want to know why? Because CRM software doesn’t run your business – people do.
Price without value
As a provider of online CRM software for small to mid-size companies most of the businesses we deal with have one thing in mind when it comes to CRM software and that’s price. It’s the first question that is asked which is a clear indication that the cost of the software may be more important than the value the software actually provides.
Seems a bit silly doesn’t it? But it’s true and it’s the primary reason so many small to mid-size companies fail with CRM.
Small businesses cannot attract or maintain experienced sales or marketing personnel and that’s ok, but no CRM software program on its own is going to address this problem. What will address it is a CRM software provider that can provide an array of sales and marketing services as part of their overall CRM solution. You will not however find this with the typical low cost out of the box solutions that you purchase over the internet.
CRM solution providers like Commence Corporation, have done an excellent job of differentiating themselves by providing a software solution that is complemented by an array of services that fill the gaps the customer cannot. These services include marketing campaign management, lead generation services, and automating the sales process. The results are measurable and include targeted marketing campaigns, better quality lead generation and a significant improvement in the management and reporting of the sales process. This is what a quality CRM solution provider will offer.
If you are firmly set on improving how you market, sell and provide services to your customers you need to be willing to invest your time and money to engage this level of expertise. If you are not, and price is the driving factor for engaging in CRM, re-think your decision. You will be glad you did.
Image ‘#price without #value’ by Francesca Romana Correale on Flickr under Creative Commons license.
Selecting a CRM software solution for your business does not have to be a grueling exercise or require months of analysis. Believe me, it’s not as hard as you think if you know how and where to focus your time. This three step approach will help you to determine what type or category of CRM solution you should be looking for in just minutes – I promise. This paper is a three part series starting with an introduction and discussion of the first step in the three step approach.
First, and I know this may sound strange, forget about consultant reviews or Google searches you may have done for the top CRM or best CRM systems. Vendors pay for these reviews, for Google listings and for their position on these search pages. So when you see a particular company listed in the first few positions on the page this simply means they paid more than the other vendors. Some people are comfortable with this and will simply select two to three of the top vendors listed and make a decision for one of them. If you feel that this is a good way to select the best solution for your business that’s fine, but stop here. My three step approach won’t help you.
There is an interesting correlation between the CRM sector and the automobile industry in the following way. They both have a targeted audience (or profile of the company or person they want to sell to). Ferrari for example, has a targeted audience and so do General Motors and Kia. The CRM sector is no different and just like the automobile industry the products and value added services they offer have been designed and priced for a specific audience.
Of course every vendor will claim to have a solution for you regardless of your size or requirements. But if you analyze the myriad of CRM solutions that are available today they almost always fall into one of three categories:
1) Small business solutions
2) Mid-market products
3) Enterprise solutions
Step 1 – The 3 Classifications of CRM Solutions
The first step in this process is to know thy-self. Take a moment to fully understand your business and what you are really trying to achieve then document it. You’ll see why in a few minutes. This does not have to look like the yellow pages or incorporate every detail.
I suggest listing the top three challenges you are looking to address. Perhaps it’s simply data consolidation so that you have a sharable customer data base. Maybe you want to incorporate a structured methodology or process for managing leads and the sales cycle. Maybe it’s much more. It does not matter — just get it down on paper so that you can match your objectives to one of the three categories above.
Let’s take a brief look at each one of the three categories.
Small Business CRM
CRM solutions that cater to the small business community offer basic functionality and are often referred to as “out-of-the-box solutions”. The term “out of the box” simply means what you see is what you get. There is a core set of functionality, but little more and there is nothing wrong with this. These are self-service commodity products that are inexpensive and perfect for the start-up company or small business that simply wants to manage contacts, add activities and notes, tag e-mails and perhaps view a sales pipeline.
Small business CRM offerings may be purchased over the internet. You put your credit card in and you are ready to go. Don’t expect too much in the way of customization however. You may be able to add a few custom fields, but you are not going to get security or role permissions, full search capabilities, ad hoc reporting or analytics at this level. And you can’t simply call and talk with a representative about your specific business requirements. Customer service is traditionally only available via e-mail.
For companies that need more than account management and a sales forecast there are several good mid-market products offering functionality that rivals many of the more costly enterprise solutions. Unlike the out-of-the-box solutions described above, these solutions allow for a high level of customizability and an array of value added services that help you realize the maximum value from the solution. Mid-market CRM solutions traditionally offer a suite of applications including robust sales and lead management, marketing campaign management, customer support, a document library, quoting, project management, analytical reporting and the ability to integrate data with other third party solutions.
These products are traditionally offered in different versions so you can start small and add functionality as needed. They are designed for companies that are serious about improving how they market, sell and provide services to their customers. You will need to take ownership of them and assign an in-house system administrator to work in conjunction with the solution provider. These are not programs that you buy over the internet and they traditionally require an annual agreement for utilization.
Enterprise CRM systems are obviously designed for large corporations, and large companies traditionally have comprehensive and complex requirements. Many are multi-national which means they require multi-language and multi-currency support, scalability to several thousand users, comprehensive security and role permissions and a system architecture built for high performance and high transaction levels. Integration with third party solutions such as accounting and EFP systems is a must have, and so are value added services for global implementation support, system development services, system integration, disaster recovery and more. This is a whole different level of product and support services than outlined above. So if you are a large or multi-national corporation, your selection of product category is easy. You need an Enterprise CRM system.
Now that you have a good understanding of the three classifications of CRM software take a moment to review the requirements you wrote down and compare them to the three categories above. At this point you will have narrowed down your search to a “category” of CRM providers, but we have more work to do.
In Step 2 of the report we are going to take a look at something most people pay little attention to – the quality of the cloud hosted service provided by the CRM vendor and how their platform can ensure high reliability and system performance.
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Managing and qualifying leads is a serious matter in today’s highly competitive market. Poor lead qualification means that your highest cost resource (i.e. your sales team) is spending valuable time and money on sales opportunities that either never close because they were poorly qualified or if they do close, they do not return the margin you need to stay in business. So what do you do? You can’t buy you way out of this problem by hiring the best sales people in the country that are experienced qualifiers, but you can fix the problem quickly and efficiently for just a few dollars a month. How?! By implementing a lead management system from Commence Corporation. Each new business opportunity is properly qualified — not by the experience level of the sales representative, but instead by an automated process the rates and color codes each new lead based on a set of pre-determined criteria.
Built into Commence CRM is an automated business process that ensures that the sales team completes a series of questions to determine if the lead is highly qualified, has future potential or is simply a bad fit. The questions and appropriate responses are created by management and are completely customizable.
Lead Qualification in Commence CRM
Based on the responses entered by the sales representative the system will immediately determine how qualified the lead is and enable the sales representative to determine the path forward. Highly qualified leads color coded red require immediate follow-up, while those rated yellow or blue can be placed in an automated marketing campaign of follow-up program. This is also automated within Commence CRM and ensures that those leads that are not highly qualified continue to receive information about the company’s products and services until such time that they become highly qualified or ask to be removed from future mailings. Either way Commence CRM ensures that there is a future path for every new business opportunity and that not a single one falls through the cracks. See more details and a video about this unique lead qualification and scoring solution.
Learn How in this Report
Ok, you are looking for a CRM solution for your business. You have surveyed the market reviewed and tested a dozen or more CRM software solutions and you are still not comfortable in making a decision. In fact you’re frustrated and you are not alone.
The CRM software sector may be one of the most competitive in any industry. There are literally hundreds of CRM solutions available from desktop programs that run on your personal computer to cloud based ones that operate over the Internet. What’s most troubling is how hard it is to differentiate one from another. Other than price and term of contract they all seem the same. I understand and hear this every day. As an executive of a leading CRM solution provider I can assure you that every CRM solution is not the same. Certainly most CRM solutions offer similar functionality. That’s a given, but there are other things to consider during the decision process other than features and price.
Outlined below are “7 Points to Consider before Making Your CRM Decision”. I hope you find this valuable and that it helps you to make the best CRM decision for your business.
1) Select a mature solution provider
With today’s economic uncertainty, it’s extremely important to select a solution provider with a trusted reputation and long-standing track record for delivering high quality products and services in your industry. There are no guarantees today, but a company that has been in business for a decade or more with an established customer base is clearly a safer bet than the one that’s just getting started. It’s also a good idea to research the vendor’s customer base and ask for references that can discuss the provider’s commitment to quality customer service and product enhancements.
2) Know your requirements beforehand
Don’t make your selection of a CRM solution a beauty contest. Take the time to document the core requirements that you are looking for and make sure you fully understand the workflow of your internal business processes. Smaller businesses tend to lose sight of this during the evaluation process and become too focused on cosmetic appearance and price. As a result, they are often disappointed in the product’s inability to support the unique business requirements that were not part of the initial demonstration.
3) Where’s my data?
Your customer information is your lifeline. Without it you’re out of business. Don’t be afraid to ask where your data is being hosted and by whom. Most vendors utilize a third party service to host your data. Ask who they use and check into the company’s track record for performance and reliability. You may also want to inquire about backup and recovery along with their procedures for obtaining your data should you discontinue the service. This is one of the most important yet overlooked aspects of your CRM decision process.
Your business is going to grow. If you didn’t believe this you wouldn’t be in business. I stated earlier that there are a myriad of CRM product offerings available. I didn’t say they could all meet your current and future business requirements. In fact, many are designed for very small businesses and will not perform well when pushed to higher levels of utilization.
Make sure the product incorporates a comprehensive set of applications even if you are not planning to utilize them today. Furthermore, make sure the solution you select has been proven to perform at two to three times the current number of users you plan to have.
5) Back-end integration
While this may not be your top priority, CRM is the front-end to all backend processes and sooner or later you are going to want to integrate customer data with your accounting or ERP system. Make sure the vendor you are most interested in offers an application programming interface or API that enables back-end integration.
6) Select a partner not a vendor
If you have made a decision to implement a CRM system because you are committed to becoming a more effective sales and service organization, then you need to select a partner to assist you not a vendor. A partner will provide you with a proven implementation plan and best practices to ensure that you realize the maximum value from their solution. A vendor will sell you their solution then suggest you send an e-mail if you require help. CRM is not a toy or an electronic gadget that you simply plug in the wall. You will require professional assistance from the CRM provider in order to maximize the value of any CRM solution. Make sure you select a partner who has a solid track record for providing this level of support.
7) Stay away from free
Nothing good comes out of free. Not good products and not good services. A world class product from a trusted solution provider who can…
- protect your data with a reliable hosting service
- provide a high level of performance
- offer scalability and growth
- enable back-end integration
- and partner with you to ensure your business objectives are met
… isn’t cheap and doesn’t come free.
This is an important decision for your business and the difference between a top rated trusted solution provider and a low cost one may be just a few dollars a month.
About the author: Larry Caretsky is President and CEO of Commence Corporation, a leading provider of cloud based online CRM software. Comments about this article may be sent to email@example.com.
Image by Tom Magliery on Flickr under Creative Commons license.