7 Apr 2015
According to IDG, B2B tech buyers are becoming more and more influenced by social, mobile, and video content when making purchase decisions. B2B will always be about relationships, it’s about being in it for the long haul and today it’s even more important to foster long-lasting relationships by providing useful content that engages prospective buyers so they are able to make informed decisions about the product portfolio you are offering and whether it meets their requirements. Social, mobile and video content have become the top influencers for B2B buyers who are seeking out vendors who can help them save time and money. If this is the case and B2B buyers are influenced by content they can seek out themselves then what role does the sales person have in helping the buyer come to a final decision?
In a traditional sales model, the hunter would go searching for the new opportunity and begin to foster a relationship with the prospective client. Their role was to educate the buyer on the value of the product or solution they were selling and ‘persuade’ them theirs was the product that would save time and money.
This is incongruent with the recent research from IDG which suggests that social media and other marketing channels are taking on the role of the hunter in the early stages of the sales cycle. With 60 – 80% of a B2B decision made prior to engagement of the supplier, we need to change the way we not only market to these organisations but also how we structure the sales organisation. There is an extensive pool of information describing how to market in a B2B environment but very little has been written about the impact the new buying process has on the structure of the sales organisation.
Using the traditional bell curve distribution model and assuming a sales force of 20 people, we would expect two sales people to be out and out hunters, two to be out and out farmers and the rest generally capable of doing both roles, albeit some more biased to the hunter and vice versa. Yet despite the fact we have a few individuals suited to specific roles the majority of the team are pigeonholed into one role or the other and it is questionable whether this is the best use of them.
If you assume 60% – 80% of the B2B decision is made prior to engagement from the sales person then a proportion of our hunters are somewhat redundant and only come into the sale to nurture the prospect over the finish line, becoming the custodian of the sales process rather than a key influencer in why they chose our organisation. If this genuinely is the case, then our sales structure is inefficient in its construct as we have hunters who are not fully utilised. Conversely, our over-utilised farmer team are spending a lot of time with the customer base but are most likely missing revenue opportunities as they are spread too thinly on the ground.
Anecdotal evidence in the service provider market suggests new business is becoming ever harder to find despite the majority of CIOs stating they are going to be consuming cloud services of some sort in the next 2–5 years. Does this evidence support the hypothesis that today’s engagement process means the CIO will ‘hunt’ the service provider out, rather than the other way round? If this is true there needs to be a shift of focus in the sales organisation structure. Much has been written about the customer life cycle and how additional focus on the customer will lead to greater customer retention and an increase in revenue yet we still have a traditional sales model that splits the organisation into two distinct teams. It is my suggestion that the new sales organisation structure should be based on four personality types.
1. The hunter. Someone who networks extensively, builds early relationships with potential customers as well as key influencers in the buying decision. Hunters nurture long term relationships with consultants, industry analysts and still find the time to generate demand in their prospect account list.
2. The HunterFarmer. Individuals who love the thrill of the chase and still want to engage with new people and build new relationships. Most suited to large accounts where penetration is low and we need develop broad and deep relationships to hunt down new opportunities. That the account is an existing customer makes the initial introduction somewhat easier than a typical cold call or first meeting. The Farmer aspect of this role (and often seniority) means the individual can manage significant support issues or queries without requiring the support of the management team.
3. The FarmerHunter. Focussed more on farming their existing account base and will most likely have lots relationships in multiple accounts, yet these relationships may be less deep than those cultivated by the HunterFarmer. They will need to manage their time well in order to manage process internally and the challenge of dealing with multiple, often smaller, accounts. May often be seen as partially a service management role where they are dealing with a plethora of inquiries from many accounts.
4. The Farmer. Your old school account manager. Has a number of special accounts where they have superb relationships. Not particularly good at broadening the number of contacts in an account but we have all had those accounts where a ‘special’ relationship is almost a guarantee of future business. The farmer is the individual who makes sure the relationship delivers consistent future business.
So there is no such thing as a hunter or farmer any more but what is significant is that three of the roles now have an element of farming in them, allowing us to structure a sales organisation in which 75% to 80% of the team have farming expertise and own a number of accounts through which they generate additional revenue. There are commission challenges with this approach as ideally you will need four separate plans with differing levels of revenue compensation and new business compensation but I will cover this in a later blog.
In conclusion, in order to derive as much revenue out of our existing customer base as possible but to retain a focus on deriving new business I believe you need a sales team with a focus on farming but with some hunting expertise. You still need to generate new business, but it is a tough role and very few people are suited to being out and out hunters. In my experience managing sales teams, I have only come across a limited number of people who want to do nothing but hunt. Of course this approach generates some management challenges but if we recognise that the majority of buying decisions are made prior to engagement, that marketing is now encroaching into what was the traditional hunter role as content becomes the new currency of sales and marketing, then it is clear we need to restructure our sales organisation to meet the demands of this brave new world, where buying decisions are made with very little personal interaction with a salesperson.
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