Magnus Marketing Blog

Once upon a time in a kingdom established long ago, there lived a family of royals who had a very olden rigid culture. They were quite established in a particular area with deep knowledge. The kingdom was built upon the outsourcing of machines which they tended to. The kingdom was also known for a product they created based upon their deep industry knowledge for those who built awareness of products/services for others. This kingdom was not overt, but had a nice group of patrons.

One day, the King desired to add more patrons to replace some patrons that left for other parts of the world. After some searching, they identified a resource that could help them - a Princess from another world. To make a long story shorter, the King and his Prince had a patron that not only gave them their machine to take care of, but also a product that ran on the machine. This was quite innovative at the time - this ASP model. The employees, if it is recalled, accessed this old product remotely. The Prince, to his credit, realized that this "ASP software hosting" may have some merit to it and launched a campaign to host other old software products for companies employees.

The Princess understood the opportunity and wanted to focus on the "ASP software hosting", some research indicated this was the way to go as more people were starting to refocus on the ASP model. She was in love with the in-house software, a really intelligent product. And, she noticed as they went to market that a lot of people were responding to it. They were interested, both in buying the software AND using it as an ASP model. The King however was more interested in finding patrons who would give their machines over and discouraged the Princess from putting too much emphasis on the ASP model and sales of their software. The Princess, known for insubordination of this type, continued to market the product anyway - shifting more time to the machine side.

One day the Princess from another world thought about the ASP software hosting idea. She happened to have a contact from a up and coming company known as "PeopleSoft", the contact was the product manager for an old software called "VANTIVE". She thought, I talked to this guy and its an old software - maybe he would be interested in this ASP thing? An email was sent, a discussion ensued. The recall was that the product manager was somewhat interested, but wanted more of a business case to be developed. A task that the Princess from another world was really not equipped to do and the Prince of the Kingdom in recall didn't want to do. Probably too much work to figure out with not enough return. After all, how would hosting "VANTIVE" really make any money for the Kingdom? Needless to say, the pursuit of the Product Manager ended. The Princess stayed on for a few more months, fruitlessly seeking patrons with machines to outsource - the sales cycle was very, very long. The King had no patience and really did not understand how long a direct sales cycle was. The Princess was summarily terminated.

Of course, we all know the fairytale ending never happened. Not for them at least. It happened however for Marc Benioff who left Oracle. He not only understood the "ASP software" idea, but took the idea of a hosted CRM solution to be in 2008 - the 43rd largest software company in the world with revenue of 1 billion+. Salesforce.com was a baby company when the discussion with Vantive, commonly known now as PeopleSoft CRM, occurred. Not many people were keen on Salesforce.com at the time because it meant giving up your data to an unknown entity, a start-up no less. I guess Marc put the pen to paper and made a compelling business case, more importantly he pushed it through. SAAS is now a standard for software offerings, too bad the "ASP" idea for the King's internal product wasn't marketed harder, it could have been groundbreaking. Sometimes sticking with what you know, versus what could be - can be the difference between a company becoming a billion dollars or having your Kingdom bought over by someone else.

This is true story. Recently, I was out there again prospecting to find a replacement client for a client that departed. The departure was under VERY GOOD terms, in fact, not only did they get leads, but thanks to the work I did - realized that they had to go back to the "drawing board" with respect to strategy and sales/marketing tactics.

I had received a call from a sales rep for an HR related solution. He articulated the solution very well and was quite knowledgeable, however, in the course of discussion he indicated that finding the right decision-makers at times (not all the time) was difficult. They marketed a tool designed for job boards. I actually referred this guy to Arbita where I felt there may be some value and mentioned another person I knew who ran a niche job board.

Not long after that, I lost my client. So I thought, the value proposition was very compelling for this solution - why not reach out to the company (which happens to be start-up/small business) and see if I too can help them. Maybe I could support the rep or take a territory or work with them in some capacity. Not only do job boards exist publicly, but within corporations. I am very well versed in talent acquisition thanks to my association with Shally Steckerl and Arbita, boy do I know stuff!

To make a long story short, I had a discussion with the VP of Sales. Even after telling him that I would have zero difficulty quickly getting on the phone, finding the right people, and presenting a compelling value proposition that can SELL their solution. He told me NO. This is what he said.

We already work with Mr. Salesguy who is part of an outsourced company (read: telemarketing firm), this firm has a process, and they have very comprehensive reporting. I give them a list of X number of companies and within 3 calls they convert it. Their reporting is great, they tell me how many connects, voicemails, and dials made down to the detail. They are also providing market feedback on pricing, which has been critical. If I don't provide these detailed reports to the management, boy, my head will roll. Plus, with this firm, I can ramp up and down...in fact, we were thinking of stopping the prospecting because our inside sales people have too much, they need to work on what they have. We are very transactional, this is a transactional sale, 1-2-3 and done. We also don't approach companies directly, a few have come to us, but we won't go after them. But hey, we can keep in touch - my VP of Marketing uses people too, as I do also- maybe in the future. He also mentioned, "I have thirty years in sales".

Do I need to relate the mistakes here?
1. I know why you are experiencing such demand for your tool. This tool or add-on is of value in todays economic climate only. Trust me, as soon as it becomes an employee's market - no one will want your tool. Plus, there could be some liability associated with it. Hm. Today and for the short term, you will have immediate interest and buyers - whatcha gonna do when that shifts?
2. Why can't you add me as a resource? So, you have another company that can ramp up and down, yah - me too. The difference is, I actually really know your industry and can quickly find and convert buyers - that means I pay for myself and can bring a little more info to the table than "pricing". Ya never asked me about my background in detail or why I feel so strongly about selling your solution. Trust me, I know where to go and who to contact. (But they have too much business)
3. Too much to work on? Stopping the prospecting? This is guy who clearly is clueless about lead management, sales management, and management generally. In thirty years, wouldn't you know to only hand off qualified, closeable leads to your team and have them close them? Something is wrong if they aren't closing the leads and "have too much to work on".
4. Too much business? Today you do, for a start-up while you don't want to stretch people to th wall (as my former employer did), there are ways to accommodate more demand. Use commission reps who close and can be equally ramped up and down.
5. Pricing. Why didn't you know this before you went to market or talk to people about what pricing would work? You waited until you built up a team of people to "discover" what pricing would work? Market research is a nice thing to have.
6. Activity reports mean qualified business? Now again, tell me how leaving X voicemails and X connects means revenue? If there are too many leads to work on, doesn't sound like there is tangible revenue. HM.

Well, I didn't call the guy back or send any further information. In about a year, he will be terminated probably because that activity being measured didn't translate into effective dollars or if they do stop the pipeline, it took months and months at a loss to rebuild. Maybe then, if I remember them - I might reach out, maybe then - they will have learned.