But have you lost sight of your customers? Many Sales VPs are innately aware of the competition. They follow the new products. They know their rivals’ compensation plans. They even track their peers’ marketing and competitive messaging. However, many VPs fail to see their customer landscape shift.
Whether your industry is mature or rapidly evolving, you must remember: Change with your customers, not your competition.
Discover how your potential customers are changing by conducting focused interviews: Download our Changing Buyer Interview Guide and discover your blind spots.
Consider the following two scenarios. Both are cases where the VP of Sales was blindsided by an evolving customer landscape. Names have been altered to protect anonymity:
Overview: Acme was the preferred vendor in the market. They had the best Teleprospecting team. They captured new leads using 97% outbound cold calling. These LDRs were well trained and capable of qualifying true prospects.
Problem: Suddenly the lead pipeline slowed to a trickle. Prospects who did engage were speaking with multiple vendors as well. Telephone response rates and Voicemail Callbacks significantly dropped. Prospects who did speak with the Teleprospectors were better informed and more aware of competitive alternatives.
Wrong Solution: The VP of Sales, desperate to provide more leads, doubled the outbound calling staff. Prospects were called twice a month instead of once a month. Leads stayed the same. The cost per lead doubled.
What Happened: ACME company failed to realize that their customers had turned to the internet to research options. Instead of building content optimized for search engine queries, Acme relied on their reputation. Competitors caught leads earlier in the funnel with website content and forms optimized for keywords. Acme’s legacy brochures and outdated PDFs left customers looking for other solutions.
Overview: Beta Company provided a software product that was one of top 3 solutions within their small-medium business target market. Customers paid a premium for their cutting edge technology. They used a field sales force model with 10 Field Reps and 3 Solutions Engineers. Each “Win” took 2.4 F2F meetings to close.
Problem: Customers started becoming more comfortable with the software, as it moved from “cutting edge” to “mature”. This ramped up the sales cycle considerably. Consumers began asking for steeper discounts as the product matured and the competition caught up.
Wrong Solution: The VP of Sales eliminated the Solutions Engineer position and hired 4 more Field reps. He wanted to make the team more local and responsive. Also, he thought the sales reps could prospect locally for more leads.
What Happened: Competitors using an Inside Sales force moved quickly into the space. By preparing demos tailored to smaller verticals, they eliminated the SE role. Using the latest tools, they were able to “Win” with an average of 1.8 virtual meetings. This Inside Sales rep typically closed 6 deals a week. All were done over the phone. Beta Company’s Field Reps closed an average of 2. Because of their expensive field sales force, Beta Company needed to price itself far above the more nimble competition. They lost 72% of all competitive deals during the year.
So what to do?
When we interview many Sales VPs, they always know the moves of their competition. This, according to the classic Wayne Gretzsky quote, is following the puck. Instead of following your competition, follow your customer (ie. where the puck is going). How are they researching their solutions? What is most important to them throughout the sales process? How do they perceive your product relative to the competition?
Far too many companies look to their peers for innovation. This is a short-term view. The company that disrupts the industry is not typically seen as a competitor. It is the emerging company with a radical model–dismissed as a niche or fluke. But they’ve identified or eased a pain point in a way incumbents never thought of. The classic response is to counter with a weak copy—but it is too late.
How do you stay ahead? Conduct prospect and customer interviews. Identify what is most important to them. Understand their needs. Once you capture this information, tailor your strategy around it.
Acme could have discovered its prospects increasingly turned to the internet to research products. It also could have asked prospects how they usually engaged with Sales Reps (it wasn’t the cold call).
Beta Company never realized customers had become comfortable with the mature product. A F2F Sales Force capable of teaching and building trust was no longer required. They wanted competitive pricing in a commoditized market.
Both of these trends could have been detected from conducting thorough customer and prospect interviews. Start doing yours today and don’t get blindsided. Download this tool to identify where your customer is going.