thinking: relating- celebrating :-)

The most successful businesses that I know follow a clearly structured sales methodology and a detailed plan to get there. It shouldn’t be too surprising that in order to get to a big sales goal there are a whole series of much smaller structured activities that need to be followed through.

Here are some outlines on key learnings from many years of successful marketing and sales campaigns.

1. Define Objectives

Typically a business will select a CRM because they want new customers or new business. They see this as a sales hunting exercise and often have other sales people for farming or account management duties. The sales “farmers” are looking to grow the business by selling more products or more volume of the same products and services to the same people.

So the first step in more successful sales plan is to decide whether you have new customers/new business goals or account management goals and your strategy will be different. Remember - a CRM allows you to treat different customers in different ways according to their needs, goals and desires.

2. Tips for Lead Generation

I was talking to a business owner recently about their needs. The owner has a number in mind for new business and is looking for the best way to get to that point. The traditional approach is to hire a business development manager who can understand the market and work out where the business will come from.

Except that in this example, little or no marketing has been completed to date. Marketing is the brains of sales. An effective marketing plan has to be part of the sales plan otherwise the risk is that that sales team resources are wasted on chasing deals they have less chance of winning than they should.

What this business needs for their new Business Development Manager is a lead generation campaign so that a reasonable sales pipeline* can be built up. (*Sometimes called sales funnel - typically a list of potential customers ranked in order of their closeness to a sales decision.) Note: lead generation can now be outsourced.

The sales team needs to have directed, relevant, useful engaging conversations with their strangers or suspects, prospects and their customers to understand the most compelling reasons why they should do business with you.

3. Work your Sales Funnel

To have a relevant conversation with a business you only suspect may have a need of your product or service some form of lead development is needed.   A marketer would have a target list of suspects and some form of communication to those people is then triggered. Often this is a multi format communication like a direct mail piece to the decision makers, a case study in an industry magazine and possibly even advertising in trade publications so that the target businesses have some idea of who you are / what you do.

At this point the phone may begin to ring - however - many of your competitors are doing the same, so you really need to “close the loop” by making contact with as many people on your target list as possible. This means making a series of phone calls to decision makers so that you can earn the right to be heard when that business has need of your services.

Many sales people make 1 or 2 calls at this point - however the golden number is 5. If you make fewer calls you will get to less people but if you haven’t reached a person after 5 calls then you should probably add them to a later campaign. There will always be a group you can’t get to in any campaign cycle. When you have spoken with each contact, determine how much lead nurturing they might need in future. When is the best time to call them again and what do they need to know about so that the relationship is nurtured to the point where you can bid. 

4. What Others Say About You Wins Business

So lets say you have seeded the market with information about your positioning - what do you actually say to those suspects / prospects if you can get some of their valuable listening time?

This is where careful thought on call scripting is needed. A script needs to frame your messaging about capabilities and credibility in a way that can cut through all the other sales messaging in your market.   You probably have 3-10 seconds to say something relevant to that person at that business before you get turned away.

What really works at this point is to get the suspects attention by telling them of a well known industry success where you were the supplier. This is especially powerful if you can quote that customer in their own words. A customer testimonial has major social capital and is much more significant that anything you can say about your own business.

As Brian Clark says

“What other people say about you is more important than what you say about yourself. This is the foundational aspect of linking and the backbone of social media.

Testimonials and media mentions are important because of the concept of social proof. We all, to vary degrees, look to others for indications of what to do and how to behave. Social proof is the basis of buzz, word-of-mouth marketing and fashion trends, but it’s also an important aspect of our day-to-day lives. We avoid sensory and information overload by looking to social indicators for judgmental heuristics that help us make decisions.”

More to the point - the suspect is more likely to believe you and give you another 30 seconds to communicate the “why” you are calling. This progressively wins you the right to more time to talk about the how and hopefully earns you an appointment where you can engage more fully in person.

5. Structure Your Sales Process

A sales call is therefore very important and needs to be carefully structured so that the prospect/s needs goals and objectives can be identified along with timelines, compelling events and other material factors like budgets and people.

So the next time a business owner asks you to sell - be very clear on all the key aspects of messaging, positioning, and proofs so you can build a quality pipeline. Every sales call needs to be a step closer to a sale for your product or service. Many times you will still have to wait for a budget cycle - but that is part of the discovery process and if you know that you can be in the right place at the right time.  Those prospects will already know who you are and you should make the shortlist for serious consideration.

The other part of the sales conversation is to be clear on the other 6 key decision metrics about that particular sales need.

6. Fine-tune with Customer Relationship Management (CRM)

If we follow a structured sales plan then we can use our CRM to fine tune these process steps and maximise our chances of success by making certain we are “in the frame” when an important opportunity comes up.

It is time to improve your strike rates with new business. We believe the notes above  provide an essential guideline for your business. To get help with sales planning and lead generation contact me now for a no obligation chat.

Find out the 6 key decision metrics you absolutely need to know.

If you would like more CRM related content please see these earlier posts

• CRM is not a Magic Bullet
• CRM & Knowledge Management
• What to Look for in CRM Strategy
• CRM as a Process Platform
• What is CRM Used For?
• CRM Thinking about Strategy 1

sales leads marketing strategy lead nurturing marketing tips

If you’re new here, you may want to subscribe to my RSS feed. Thanks for visiting!

For all the reporting on the planned $5b buy of Dow Jones there doesn’t seem to be much insight into how Murdoch can make the numbers work.

In a post last week we decided that it was likely that adding TV and some of the group synergies with online properties controlled by Fox had to be part of the answer.

The weird thing is people seem to treat this like rocket science and that somehow Murdoch is a magician. In my view it is much more simple than that. You go for growth and follow the money and then leverage, leverage, leverage.

Murdoch has an insiders strategy which is clear to him; not surprising considering how long he has been around the media industry. He understands that newspapers, TV and web are all parts of the same content machine and much of that comes down to having the best traffic and resulting ad revenues.

We don’t have the same level of inside information that Murdoch has but the trends are clear. Leveraging the resources of Dow Jones and the Fox television empire will make for a powerful combination. Is it going to answer the $5b question?

This chart of comparative 2006 returns was presented by Dow Jones CEO at a recent briefing. It shows McGraw Hill, Dun & Bradstreet and Thomson achieving better than 20% returns. Dow Jones is shown at 10% return (which seems better than the published figures) NY Times is running at a 5% loss and a whole raft of other newspaper based groups are shown to be marginal.

Note: The Tribune announced a 27% drop in cashflow recently and given that they show as having a 4% return rate on the graph above they must be in serious trouble as is the planned $8.2b public float.

Jon Fine has asked the question Which American newspaper will be the first to kill its own print edition? which is an indication of how tight margins are for the newspaper focussed groups. (In fact it has started to happen with the announcement that “Scripps (SSP) said it would close its newspaper in Cincinnati on December 31. The daily in Savannah said it will shut down circulation in areas out of town.” See here for more on actual newspaper closings and reconfiguration plans.)

Fine mentions 3 scenarios and one of them fits this story.

It makes sense to do this (drop print edition) in a top-tier market full of affluent, wired professionals, in which the daily paper is inexplicably tanking. This is the “Boston Scenario” or the “San Francisco scenario;” rich cities, tough times at the daily newspaper, perhaps these places are where the flight to the Web is making itself apparent.

His prediction “within two years, maybe even less, a major newspaper company will go all-digital with one newspaper.”

There will be some newspapers within the Dow Jones group where this scenario could be tested if the Murdoch bid succeeds.

Now that the October launch date of the new Fox Business channel has been announced - it does help to make much more sense of the $5b offer. The new network would be able to use anchor content from the Wall St Journal and that would go a long way towards improving profit margins at DJ and improving the advertising revenues and rates at the new channel.

CNBC is now linking more closely with the FT as noted by 24/7 Wall St.

The FT, owned by Pearson (PSO), and CNBC, a unit of GE (GE), don’t want to buy anything. So, they are forming a joint venture. At first, CNBC will be able to put FT articles at its website and the FT will run CNBC content at FT.com. Of course, if someone bookmarks both sites the content is available with a key stroke.

The new channel has been in planning mode for some years. First mooted in 2004 planning has been ramped up in the last year. Some of the business numbers were mentioned in this background piece from November ‘06.

NewsCorp can only buy DowJones because it doesn’t own a local TV affiliate in New York City. Cross ownership rules mean that this is a unique opportunity of size that Murdoch can’t resist and while Fox Business can work without Dow Jones - if the deal is completed it becomes much more lucrative.

News Corp.’s new Fox Business Network will launch on October 15, Fox said on Wednesday, in a bid to rival business cable channels CNBC and Bloomberg Television.

Fox Business has secured distribution agreements with leading US cable operators that will make the channel available to 30 million subscribers, a company statement said. Read more here (from Yahoo News).

Meanwhile, this announcement is likely to speed moves by Sky News to establish a similar 24-hour pay-TV business channel in Australia. Read more here

So about that $5b here is one final comment from 24/7 Wall St. Murdoch paid $565m for MySpace. Its revenues are apparently only around $200m. Douglas A. McIntyre used those numbers to suggest that Facebook is worth $zero because its revenues are estimated at less than $50m - despite an estimate as high as $10b by another organisation.

The Future of Media 2007 conference is on now and many of these ideas will be reviewed at length. On page 4 of that (Future of Media) pdf is a chart that shows Quarterly Online ad spend has now reached $5b from almost nothing in ‘97. (Global ad spend $446b)

As the DJ negotiations are continuing, it now looks as if Murdoch will get his deal despite serious reservations on the prospects for editorial independence as covered by John Nichols in this summary.

For some ideas on what happens next check this analysis.

“media futures” Rupert Murdoch

Some of you will note the popularity widget in use at the bottom of each post.

The top 10 list has now been moved to the top-10 page.

The ongoing negotiations surrounding the sale of Dow Jones to Rupert Murdoch offers a fascinating glimpse on the future of the media business.   

On one side Rupert is offering $60 per share which values the group at $5b when the 52 week low has been $32.16 which would be only half that which is partly why the takeover scenarios are so exciting.

The question of mission “What business are you in?” is absolutely key. The transition from a newpaper centric business to a fully digital stream  with 60% of 2007 revenue being from print and a transformation plan to get below 50% (by 2009) are well underway.

At the recent shareholders meeting the CEO Rich Zannino had this to say: (PDF p.6 18th April, 2007)

“As you know, the media business is undergoing what can only be described as revolutionary change. A relentless convergence of technology and content has led to an explosion in the number and availability of news sources. Consumers have never had as many choices available to them. And advertisers have never had so many ways to reach them. This is wonderful for them but threatens traditional media business models.

Fortunately, we see many opportunities in this new media landscape. True, traditional media usage is on the wane, but digital media is rising faster. This is not a zero sum game: total consumption of media is way up.

And we all know that an unhappy side effect of this digital revolution is that there is simply too much information out there today for any one of us to sift and process, let alone act on.

At Dow Jones, our competitive advantage is based on the reputation of our brands for authority and accuracy and the quality and differentiation of our content. When we’re at our best, our readers find us indispensable. We help them cut through this information overload to find what they need.”

Richard alos offered these examples of turnaround improvements in the business - “acquisition of Factiva will increase our Enterprise Media Group revenues by about $300 million, or 75%. It will create a strong platform for profitable growth in the attractive B2B market” and they have achieved $65m in cost savings in 2006… 

One of the salvos fired by the Murdoch team in recent negotiations went like this. “Close down all the newspapers and put everything online for free.” 

There is no doubt that distribution and printing is expensive and around 7% of costs comes from newsprint alone so lowering the physical “footprint” of the paper makes a great deal of sense but Rupert’s suggestions were even more radical as pointed out by 24/7 analyst writer Douglas McIntyre. In an edition of Time magazine Rupert said:

In his own words: “And then you make it free, online only. No printing plants, no paper, no trucks. How long would it take for the advertising to come? It would be successful, it would work and you’d make … a little bit of money. Then again, the Journal and the Times make very little money now.”

The notion may seem insane, but it is not. Last year, the consumer media group at Dow Jones (DJ), made up mostly of the WSJ, had a profit of $33 million on over $1.2 billion. Almost none of that money came from overseas. Several securities analysts have said that The New York Times (NYT) newspaper breaks-even at best.

Putting an entire newspaper online means dumping the huge costs of printing and distribution. At a newspaper with a circulation of 1 million, this can certainly be $1 a paper, depending on where it is printed as where it has to go to be sold.

At one level, such a scenario needs to be taken with a truckload of salt. This is after all the very same Mr Murdoch who has offered $5b for the company; but the plan is not as radical as it sounds. 

It all comes down to the change timetable and new management who appear to be making headway with improved profitability at the business.  (Maybe Factiva is the key? full control of Factiva has been approved and that represents an extra $300m in revenue.)

The true value of the enterprize has to be way more that the $32 per share offered previously but the share size and scale of the transaction is daunting to many.

Huge changes to newspaper advertising revenues were certainly behind Fairfax’s buy of TradeMe (an auction based website which outperformed eBay -for US readers) for NZ $700m in March 2006 which was seen by many as too expensive even though the price represented 15-16 EBITDA. In hindsight this looks to have been an inspired deal with earnings growth and ongoing expansion still going strong more than a year later.

This is from a report in February 2007. (Note: Fairfax market cap was $A8.9b at that time. They are reported to have 65-70% share of the Australian classified ad market.)

“Fairfax’s New Zealand publishing assets are more profitable than those in Australia. Margins on earnings before interest and tax (EBIT) are 29 per cent, compared with Australia’s 18 per cent margin. Fairfax Digital’s EBIT margin is nearly 26 per cent, up from less than one per cent in 2005.”

and in the same article

“Arthur Sulzberger, publisher of the New York Times, said at the World Economic Forum in Davos he wasn’t sure if the New York Times would be printed in five years.

“I really don’t know whether we’ll be printing the Times in five years, and you know what? I don’t care either,” he said.

He may just get his wish as on July 3, last week 24/7 Wall St noted:

“Goldman Sachs made about as brutal a call as it could have on The New York Times Company (NYT). It added it to its American Investments Sell List. The price target was set at $18. On Friday, the shares closed at $25.40, so Goldman believes the shares will drop almost 30%.”

The other high impact development in this space looks to be Ebay’s new classified ad site. From 24/7 Wall St

“eBay (EBAY) has started a free classified advertising site. It is not unlike the highly successful Craigslist. The site is called Kijiji”According to The Wall Street Journal, eBay may start to charge for display advertising at the website at some future point in time. The real loser, if the site becomes successful, is the large newspaper chains like McClatchy (MNI) and Gannett (GCI). They hardly need more competition for their flagging print classified sections, which are already being bled dry by online sites that charge for ad that compete with them. “Free” makes the competition even harder.”

At this point DJ are scouting for an alternative deal but indications are that $5b is still a huge premium to pay for a newspaper empire transitioning online when the online kings are already eating their lunch as already shown by the Trademe example.

I doubt that Rupert is going to get his wish of going 100% online with Dow Jones but here is the highly incentivised opportunity for the management to dramatically accelerate their transformation programme now that the new media roadmap is becoming much clearer.

Perhaps Mark Cuban has some ideas when he wrote this back on May 20

“Riddle me this Batman: Rupert Murdoch has figured out that Print and TV can be combined to be a vertical news organization and is willing to pay 5 billion dollars to do it. Why has no one else realized the value of combining big news brands and organizations ?

Why isn’t a CBS News merging their news department with a NY Times and rebranding itself as the 6pm NY Times News ? Or with Time Magazine News ? Or NBC News and ???

I recognize the arrogance factor. That each wants to be the defacto source of news in this country and lever what little editorial power they still have left (Does anyone other than the people who write editorials or are written about really read the editorials in newspapers these days ?). But its time to realize that drastic change is necessary and that ego needs to be put aside.”

What do you think? Does Murdoch know more about the DJ brand than the current management team? Is Mark Cuban right? Do you have a another / better analysis.

Update: 13th July from June Traffic For Major Business Websites

Brand or Channel            Unique Audience (000)       Time Per Person (hh:mm:ss)
Yahoo! Finance  (YHOO)            14,878                              0:24:11
Wall Street Journal  (DJ)              7,852                              0:20:12
MSN Money  (MSFT)                  11,190                             0:17:39
AOL Money & Finance (TWX)     9,827                             0:16:08
CNNMoney                                     6,263                             0:15:49

All of the other sites were around the 5 minute mark for time per person.  It is probably significant that Wall St Journal as the flagship of (DJ) rates at 20 minutes per person.

If I was investing $5b - I would want to understand that. The 33 Pulitzer prizes probably help too.

“media futures” Rupert Murdoch

At the recent New Yorker conference, called “2012: Stories from the near Future” was a piece by Malcolm Gladwell on two ideas of Genius. The video link is here - but check the size - it is 27 minutes long (and my HD version is 350mb! - HD Xml feed)

What is fascinating to me about the speech, is how Gladwell tells the story with his historians ear for detail and uses it as a learning observation on problem solving styles. Gladwell has a wonderful story telling style, as you will know if you’ve checked his books (Tipping Point, Blink) or his video presentation on Spaghetti Sauce at TED.

This story is about the differences between work methods used by Michael Ventris in solving the Linear B code from the ancient Mycenean writing in 1953 and Andrew Wiles who solved Fermats Last Theorem in 1994.

By way of background, the theorem had been unsolved for 357 years and really most people know little about it and care even less. However it has been a magnificent obsession for mathematicians and might have some other less abstract value - (a story for another day - and BTW -what does solving the theorem achieve? - answers please)

Sidebar: Incidentally, Gladwell quotes Paul Erdos as saying that ‘a mathematician, is a machine for turning coffee into theorems’” in his wonderful essay on the rise of java man. Did you also know that Malcolm Gladwell was a history graduate which could be perfect training for his writing and speeches, and other amazing roles as suggested by Ion Valiskakis in “The Return of History”

Daniel W. Rasmus has elegantly summarised the arguments for and against Gladwells thesis that Ventris represented the “lone genius” while Andrew Wiles had 13 helpers - my paraphrasing. In other words, that modern genius was more about collaboration and focus than the archetype eureka moment. ( Note: Rasmus points out that Ventris had help from Kober and Chadwick so he wasn’t entirely isolated in his quest.)

Gladwell worked out that Wiles had done his 10,000 hours and that was very much needed to solve the problem and extrapolated that this might be some kind of rule. It certainly struck me as a usable idea for mastery of a subject and we should think more about this. Gladwell’s rough calculation was that 10,000 hrs equates to 10 years - however my calculation is that 5 years would do it if you were lucky enough to work the equivalent of a standard work week on your specialist subject.

So for Gladwell 10,000 hours of time represents some kind of threshold of advanced competency that Wiles was able to achieve.

Rasmus is not so sure and notes that problem solving is only one kind of genius and that:

“Collaboration is right. Obsession is right. So are many other attributes, like pattern recognition, building consensus, creating relationships, and incremental and purposeful innovation….

“Let us not be so narrow in our definition of genius because with change we can not foretell what kind of genius we will need so as we do with learning, pushing toward life long learning, we should be pushing for life long pursuit of insight, because we never know who, or where or what may be needed as the world’s values and economics and technologies shift around us. “

He goes on to suggest that:

“Ventris represents the model of the lifelong learner, the person who strives to add value based on their talent despite the lack of interest in formal studies in an area, a lack of aptitude for an approach or technique — but with a keen insight into problem solving that may in fact, be innovative, too innovative perhaps, and too time consuming to be supported in an academic world driven by the productivity of publication.”

Rasmus also notes the rise of the amateur professional as represented in part by Ventris and this is also the topic of a presentation by Charles Leadbeater @TED (see below)

This idea of the amateur professional is also supported by Charles Leadbeater in a TED talk called “The rise of the amateur professional” see the 19minute video on TED.

“Passionate amateurs, using new tools, are creating products and paradigms that companies can’t.”

…and he makes the point that the mountain bike industry came from professional amateurs who reinvented the cycling sector to the point that 65% of it is mountain bike related innovation. (ultimate mtn bike here)

So what do we all learn from this - within the context of a blog on thinking about business and technology? Shouldn’t I be trying to link this to business systems and the use of crm software for example?

At the very core of a CRM system is the idea of knowledge management and especially “tacit knowledge” management which I wrote about as CRM & Knowledge management a while back.

In your company you will have very experienced staff who have long ago completed their 10,000 hours of mastery and much more and now they are experts at the art of the deal.

Somehow they are able to craft brilliant results from what looks to be unstructured territory; and that can be a challenge for any business to incorporate that learning and knowledge transfer to others.

Part of the way we transfer tacit knowledge is story telling and I was pleasantly surprised to find that a company called anecdote even have a consulting workshop called “sensemaking”. Shawn Callahan of Anecdote suggests: (after checking the genius video)

1. persistence and collaboration might be more important personal traits than lone genius in a complex and changing world; and
2. a person needs to invest 10,000 hours of concentrated and reflective practice to achieve mastery—this amounts to about 10 years.

Part of what makes us successful into the future is the way in which we which can foster knowledge sharing, learning and collaboration by using new tools such as blogs, video and other new media tools to connect and leverage our own ideas.

In Gladwell’s story of genius, may I suggest that role of collaboration is the key learning point and that is we should look to capitalise on our supreme advantages of education, bandwidth and collaboration tools. The idea of capitalisation which Gladwell highlights is also very useful.

Capitalisation is the concept that all 6′10″ tall males - have probably tried out for basketball where they might be a natural; but we don’t do that for other advantages like education , as a rule (at least to the same extent.)

Innovation and change can come from unlikedly sources and often do as Charles Leadbetter suggests and the youthful Eva Vertes hypothesis on cancer show us.

It can also be something much more prosaic and no less vital such as: doing better in the way to we address and service our existing customers and reach out to get new ones where collaboration, feedback and even stories form part of the learning process.

Malcolm Gladwell Fermats last Theorem New Yorker Conference collaboration knowledge management Charles Leadbeater Andrew Wiles