article | January 30, 2014
Social Selling Applicability by Industry
Tp]he potential impact of Social Selling varies greatly by industry
Social Selling will be highly disruptive to some industries. Not so much to others.
If you are in an industry where social selling has high applicability, peddle faster. If you don’t modify your core sales model, your competitors will beat you. It is unwise to play it safe in this situation. Social selling is a zero sum game. Win with it and you are likely to win big.
If you are in an industry where social selling has low applicability, ignore it. You do not need to modify your sales model. Let your competitors get distracted. Keep your eye on the ball and you will beat them.
How do you know which one you are?
We track 19 industries. A post reviewing all 19 would not be a post, but a book. Therefore, I have developed three industry “clusters”. Use them to quickly determine if social selling is applicable to your industry.
Legacy Buyer Industries
For these industries, there is unlikely to be a wholesale shift to social selling. Examples include medical devices and pharmaceuticals. We project a gain of 5 percent in medical devices. We project a gain of 3 percent in pharma. It will be 2019 before these gains are realized.
The reason for modest growth is medical devices, and pharmaceuticals, have persistent buyer behaviors. Social selling capabilities can only go so far in simulating the experience of selling. Reps need to be in doctor’s offices and operating rooms.
Innovative Buyer Industries
These industries are likely to see a more transformative effect from social selling. Buyers in these industries are rapidly changing how they buy. For example, Software and IT Infrastructure offer virtual rather than physical products. Buyers can make a purchase decision with little help from a sales rep. This makes these industries highly susceptible to social selling transformation.
We project social selling revenue gains to average 40 percent here. Companies in these sectors have their work cut out for them. They need to absorb sales-model changes while fending off competitors. The onus will be on the companies to act decisively and quickly. This means streamlining and repurposing their legacy sales models. They need to redirect the freed-up resources to build out their social selling capabilities. Such change may come with a stiff price tag. But these industries may have little choice but to step up in a sustained way. The current trajectory suggests they are headed toward greater disruption from social selling.
SOP Buyer Industries
These are the industries that have completed several rounds of social selling disruption. This is how the buyers buy. Social selling is standard operating procedure at this point. Sectors like publishing, electronics, and travel have seen their sales models permanently changed. For instance, publishing and travel is expected to originate over half of their revenue from social channels in five years. This will continue to reshape the sales model for companies in this cluster.
These industries will need to implement social selling in new areas. For instance, companies can leverage big-data social analytics to boost sales coverage efficiency. Sales teams in this cluster that succeed will be those that make bold bets to reshape themselves. Failure to do so is swimming upstream. It is no longer if, or when, to implement social selling, but how big to bet? Typically there are small organic growth rates in these industries. Growing revenue by a few percent will translate into significant top-line impact.
The message from our research is that sales teams need to embrace social selling. But they should do so in line with their own unique opportunity. Why invest in social selling if improvements to the current sales force will suffice? Conversely, why mess with small experiments when the revenue is large?
To assess and act on the social selling opportunity, we recommend four steps.
In summary, capturing the value of social selling will be important in most industries. It will be critical for survival in some. But not all.
If you are new to social selling, and need help, go here. One of our experts can help you through the 4 steps above.
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