Archive for the 'The Age of the Customer' Category

Do you know how to load your Sales Pipelines?

Here’s an ancient marketplace maxim: Selling is a numbers game.

A maxim is a generally accepted truth and this is one because of two realities:

1.  There are hundreds – if not thousands – of things that can cause a fully qualified prospect to not complete a transaction, at least not on your time parameters.

2.  Regardless of how many bumps you encounter on the path to a signed contract, it’s still your job to produce enough gross profit from sales revenue to stay in business.

Enter the sales pipeline: a planning concept that helps managers and salespeople forecast sales for any given period – week, month, quarter or year. Think of your sales pipeline as overhead plumbing with faucets positioned at the time intervals your operation requires. And from these faucets you draw the mother’s milk of any business – sales revenue.

But there’s one pesky thing about sales pipeline faucets: they all come with screens that only allow sales from qualified prospects pass through, while poorly developed prospects are blocked. So if you’re counting on revenue pouring out of a faucet when you turn the handle on the day you need sales, you must load only qualified prospects into your pipeline to begin with.

A qualified prospect has answered enough questions – directly or through research – to allow you to determine that they will likely purchase what you sell from someone in the forecastable future. Before you place a qualified prospect in the pipeline, you must know at a minimum:

· What’s left to do for them – demonstration, trial, proposal, final close, etc.;

· Anything else that has to be done to move them to customer status.

Your appraisal of all of this information will help you forecast which faucet you should expect a particular sale to pour out of this Friday, next week, next month, next quarter. Once in the pipeline, a prospect is either on track to become a sale, a lost sale, or a forecasting mistake to be removed.

Alas, in the absence of professional sales management, poorly trained salespeople will try to forecast low-quality prospects. And any company that counts on such practices is headed for a cash flow crisis and ultimate business failure. Not because the product wasn’t good, or the price was too high, or because of Amazon. But because the sales team didn’t load the sales pipeline with enough qualified prospects.

At this point, let’s refer to The Bard. In Act I, Scene III, of Hamlet, arguably Shakespeare’s most important work, Polonius famously says to his son, Laertes, “This above all, to thine own self be true.” If your sales team is honest with each other and management about a prospect’s qualified progress to faucet-conformity, you’re setting yourself up for success. If not, well, you know.

Sales has been and always will be a numbers game. But in the Age of the Customer, it’s increasingly becoming more of a quality prospecting game. Consequently, how much revenue you draw from your sales pipeline depends on the two elements of the 21st century sales success calculus: quantity x QUALITY = your ultimate sales performance.

Here’s Blasingame’s Law of Sales Pipeline Success: Load the pipeline with enough (quantity) qualified prospects (quality) to flow through the faucets of your sales pipeline whenever you need them (success).

Write this on a rock … Load your sales pipeline with quantity and quality, and to thine own self be true.

The velocity of change and new customer expectations

And when I die, and when I’m gone, there’ll be one child born in this world to carry on, to carry on.
– “And When I Die,” by Laura Nyro, performed by Blood, Sweat & Tears.

As we know, change has been the one constant of existence on planet Earth. Each generation gives way to the next, so that over time fire became electricity and the wheel morphed into a computer.

For most of the history of the marketplace, change progressed at a pace slow enough to allow the creator of a model - a product, strategy, skill, etc. — to make a living with it for a lifetime, possibly even passing that model on to his children. But within the past century this paradigm began to shift.

During the second half of the 20th century, the life expectancy of a typical model generation was compressed into a calendar year. So while you were delivering the current year’s model to customers, you had to simultaneously create and prepare next year’s model to be ready to launch January 1.

That was a nice trip down memory lane, wasn’t it? Buckle up.

Since 1993 (the year the Internet became available to the public), an unprecedented confluence of innovations has further compressed the time between model generations. This compression produced high anxiety and frustration for any business that was in love with its model. Indeed, the life expectancy of a model that not so long ago would have been a calendar year was now measured in terms of an Internet year, which is 90 days — or less.

The headwaters of this increased velocity of marketplace change is innovations that are driving new customer expectations. And these innovations have become so seductively elegant and seamless in our lives that customers often don’t even realize their expectations are changing at all, let alone how fast.

But what about your business’s anxiety and frustration? Well, even if customers know, they don’t care. Because they worship at the throne of WIIFM. What’s In It For Me?

I have good news! You can avoid anxiety, frustration — and failure — if you know what your customers’ evolving expectations are, which you can determine by asking them these five questions - every day:

1. What do you want?
2. How do you want me to tell you about it?
3. When do you want it?
4. How will you use it?
5. How do you want it delivered?

Comparing the answer to these questions with what customers told you yesterday will provide all the information you need about current and future products, service and technology, including — especially — your social media and mobile strategy.

Let me put all of this in one sentence: If you want to know what your business should be doing tomorrow, next month and next year, ask your customers. They already know. And if you do what they tell you, you’ll be able to sing these new lyrics without any blood, sweat or tears:

“And when our model dies, and when it’s gone, we’ll produce a new model in this world to carry on, to carry on.”

Write this on a rock … Customers will tell you about their changing expectations - let them.

The power of building customer communities

Incredibly, in 2017, here’s a question many small business owners ask: “We have a website, do we need a social media strategy, too?”

The answer is the same as for why you have an email address even though you have a phone.  It’s not either/or, but rather both/and. Because as outstanding and handy as your website may be, there’s one increasingly important capability you need that most websites aren’t good at: community building.

Once customers find you, returning to that beautiful website of yours will be of decreasing interest to them. It’s not that your new stuff - products, how-to information, order status, special offerings, etc. - is no longer of interest to customers. It’s just that they don’t want to have to come back to your website to get it. More and more, customers are saying to businesses, “I like what you offer, but I won’t be returning to your website much, because I’m very busy. Why don’t you follow me home with the new stuff?”

This is what customers and prospects mean when they join your community by giving you permission to connect with them and send them offers and helpful information by email, text messaging, Twitter, Facebook, etc. They just want the new stuff, including updates to your website. Even when they return to buy something on your e-commerce platform, they expect to enter your website through the offer page you sent them, not from your homepage.

Building online customer communities - and getting permission to follow customers home - is how a small business transcends being competitive and achieves the pinnacle position: relevance. As you may know, I define a business social media strategy as building customer communities. But by my definition, social media is much older and more comprehensive than the online platforms, like Facebook, Twitter, etc. Your customer community strategy includes everything you do to build, connect with and serve those communities, including: email marketing, customer loyalty programs, the new social media activity, and, of course, the original social media: face-to-face.

In the old days - way back in 2003 - your customer list was just names on an accounts receivable report or sales forecast. Today, those customers are part of your business’s community, which also includes prospects who’re just becoming interested in you. But unlike the passive customer list of old - and visitors to your website - this community is functioning and dynamic, with fast-evolving expectations you have to meet or they’ll defect to another community.

Another important component of building customer communities is allowing prospects and customers to see your corporate values. Increasingly, prospects will turn into customers, and customers will become loyal, because they’re attracted to what your company stands for, which is evident in the values you demonstrate, including online. For example:

1. Are your brand elements - brand promise and image - all about you and your stuff, or do they sound like something that would benefit your customer community?

2. When delivering information, is it all about you, or does it contribute to the community?

3. What’s the tone of your marketing message? “Tone” is how brand messages are incorporated as you serve the community, from crassly commercial to almost subliminal. You should strike a tone balance between serving the community and making a sale.

Notice all of these demonstrate values that favor relationships more and transactions less.

In a world where everything you sell is a commodity, value - product, price, service - is the threshold of a customer community, but values are the foundation. Value is easy to find these days. But when community members are attracted to your values, they keep coming back and bring their friends.

Write this on a rock … Build and serve customer communities with a website and social media strategy that demonstrates your values.

Four new marketplace truths every small business must know

What is our value proposition?

For 10,000 years, during a period I call the Age of the Seller, answering this question was the focus of every business as it went to market. Indeed, customers refined their search for products and services down to the semi-finalist sellers based almost entirely on components of the classic competitive value proposition: price, product, availability, service, etc.

But then something happened.

The Age of the Seller was subducted by The Age of the Customer. In this new era, where value is now presumed, the prime differentiator is no longer competitiveness, but rather relevance. Today the question every business must focus on when they go to market is: What is our relevance proposition?

So does this mean sellers no longer have to be competitive? Not at all—no one will pay you more than they should. But consider four new marketplace truths:

  1. With value now presumed, customers expect to find what they want, at a price they’re willing to pay, from dozens of sellers.
  2. They don’t care if they do business on Main Street or cyber-street.
  3. Prospects are self-qualifying themselves and pre-qualifying a business based on relevance to them before a competitive position has even been established.
  4. Prospects are doing all of this before you even know they exist.

That last point is perhaps the most breathtakingly disruptive development in the shift to the new Age. As this shift plays out, two types of sellers—Hidebound and Visionary—currently exist in parallel universes, but not for long. Which one are you?

Hidebound Sellers
These companies are so invested and entrenched in the old order of control that they deny the reality in front of them. They can be identified by the following markers:

Misplaced frustration: As performance goals get harder to accomplish, frustration makes those who deny the new realities think their pain is caused by a failure to execute.

• Bad strategies: It’s said that armies prepare for the next war by training for the last one. So it is with Hidebound Sellers. While Age of the Customer pressure makes them think they’re being attacked, they persist in using Age of the Seller countermeasures.

• Destructive pressure: Convinced of execution failure, pressure brought to bear by management results in an employee casualty list and a shrinking customer list.

• Equity erosion: Defiance in the face of overwhelming evidence sustains the deniers until they run out of Customers with old expectations, and their equity and access to credit are depleted.

Visionary Sellers
These sellers are adjusting their plans to conform to the new reality of customers having more control. Visionary Sellers are identified by these markers:

• Acceptance: They accept that customers have new expectations about control and make adjustments to this reality.

• Modern sales force: They hire and train their sales force to serve increasingly informed and empowered customers.

• Technology adoption: They offer technology options that allow customers to find, connect, and do business using their expectations and preferences.

• Relevance over competitiveness: They recognize that while being competitive is still important, it’s been replaced in customer priority by the new coin of the realm: relevance.

• Special sauce: They combine and deliver high touch customization with high tech capability.

In The Age of the Customer, Hidebound Sellers are dinosaurs waiting for extinction. Visionary Sellers are finding success by orienting operations and strategies around a more informed and empowered customer seeking relevance first.

Write this on a rock … What’s the verdict? Are you Hidebound or Visionary?

What Macy’s and Sears didn’t know about barbells

The American retail industry has been going through a major shift in recent years, but very recently we’re seeing increasing pressure on the Big Boxes.
In my last column, I introduced the macro-economics concept of The Barbell Effect now being created by this disruption in the retail sector. This column reveals why that macro-disruption should be good for Main Street businesses out in the micro-economy. If you missed the first column, check it out. In the meantime, here’s the gist:
The Barbell Effect occurs when entrenched, legacy practices are disrupted by forces like new technology, innovations, and shifts in demographic behavior, like when people stop going to malls. Those industry players who fail to adapt to the shift are forced to retreat into the contracting middle, the bar. Those who adapt will prosper in the bell ends, where most customers are going. Remember, the barbell doesn’t exist prior to the disruptive pressure — it’s the result, not the cause.
As the Big Boxes are being squeezed into the claustrophobic, bar-of-irrelevance, they’re closing stores faster than you can curl a two-pound free weight - by the hundreds. Their legacy model — customers walking into their stores to buy stuff — is built around a 150-year-old paradigm that’s shifting. Futurist and implications expert, Joel Barker warns, “When a paradigm shifts, everything goes back to zero.”
The energy driving this shift is the fast-evolving customer expectations, which are increasingly associated with e-commerce. Customers are finding it easier to shop for and acquire stuff online, which fits their 21st century lifestyle and saves them time. Here’s the retail barbell by the numbers: currently, online sales are just over 8% of all retail, but with a bullet of a half-point a year. Meanwhile, the legacy brick-n-mortar sector has seen 27 months of declining sales (Bloomberg).
Of course, we know who’s greasing this shift: the 1200-pound Internet gorillas like Amazon and Google, plus one more disrupter — mobile. Mobile computing wasn’t any part of our past, but with 20% of online sales and a faster bullet, it will dominate our future — as in tomorrow. You must have a mobile strategy.
In his 1982 book, Megatrends, John Naisbitt prophesied, “The more high tech we have, the more high touch we will want.” Make no mistake — this retail Barbell Effect is the fulfillment of the Naisbitt prophesy. The good news for small business is the Big Box retreat is leaving a High Touch vacuum you can fill, if you understand what’s happening on the ends of the barbell:
  1. The digital bell - for when customers seek sexy, high tech, virtual contact, while allowing Big Data manipulation and scratch-your-own-itch service;
  2. The analog bell - where customers go to satisfy their craving for that special sauce made from Main Street high touch AND slightly-less-sexy high tech. It tastes like this: “We’ll help you scratch your itch” customization; “Good to see you again, Mrs. Smith”; “Thank you for your business;” “Be sure to check out our mobile site.” “Follow us on Facebook.”
The reason it’s The Barbell Effect, and not The Lollipop Effect, is because of the primal truth that powers the analog bell: One hundred percent of customers who demand digital are themselves 100% analog. You and I, and every one of our customers are as analog as a caveman or a kumquat, which means we’ll always have analog, high touch itches. And with all the high tech leverage they can muster — 3,642 backscratcher purchase options (I checked) — Amazon can’t scratch one analog, high touch itch.
In the wake of the big retreat of the big retailers, combined with the analog limitations of the big e-tailers, that High Touch vacuum will be filled by Main Street businesses delivering their high tech/high touch special sauce. And since your small business doesn’t have to conquer the world to be successful, you don’t care if the digital bell is sexier and bigger than your part of the analog bell. The big guys need all of that to survive — you don’t.
Write this on a rock … Vacuums don’t stay vacuums for long, and there’s no room for you in the bar. Tick tock.

Beware the Barbell Effect, unless you’re a small business

Once upon a time, in a land far, far away – in Internet terms that’s about 10 years ago – a small business owner didn’t have to worry too much about macro-economics. Well, that was a nice trip down Memory Lane.

Today, Main Street business owners have to operate every day in their micro-economy, while keeping an eye on what’s happening at the macro level. Alas, macro-economics isn’t easy to get your head around when your highest priority on Monday morning is to cover payroll on Friday.

Here’s a handy macro-economy metaphor: the Barbell Effect. Essentially, this phenomenon occurs when natural forces – new technology, innovations, shifts in demographics and behavior, etc. – disrupts entrenched, legacy practices of an industry. The disruptive pressure squeezes industry players who fail to adapt causing them to contract into the bar. Those who adapt find their way to the bell ends, where there’s room to expand.

At the macro level, the barbell doesn’t exist prior to the disruptive pressure – it’s the result, not the cause. In the marketplace, the energy causing the disruption is customers empowered with new expectations. This will be on the test: When customers are empowered, businesses are disrupted and barbells are likely.

There have been many examples of the Barbell Effect – some small and local, and some even global. I read recently about a housing barbell in one city where units on the high and low ends – the bells – were selling well, while the ones in the middle – the bar – not so much. The American banking industry has experienced its own Barbell Effect this century. As big banks got bigger on one end of the barbell, community banks hung in there on the other end, while medium-sized banks experienced financial claustrophobia as the bar got thinner and thinner.

Right now, the Barbell Effect is creating an existential reaction that can literally be watched by Main Street small businesses from their front doors as no-longer-relevant retail giants are closing hundreds of stores at a breathtaking pace. Here are some numbers: As of this year, 200 Sears stores closing brings their numbers down 60% in the past 5 years, while K-Mart is shuttering over 100 locations. Macy’s is closing 100 stores, and JC Penney is projecting 300 store closings. And besides these big guys, many medium-size retailers are also making the acquaintance of the bar between the bells.

The pressure creating this retail barbell is arising from new and evolving customer expectations, which increasingly means higher adoption of e-commerce – online shopping/purchasing. But the new expectation isn’t about unique products, lower prices, or better service, it’s the most powerful relevance advantage in The Age of the Customer: saving time. Technological innovations and customer care practices – easier mobile shopping and electronic payment, plus free delivery and easy returns – are saving customers enough time to change their shopping behavior and create a barbell.

As we witness the disruption – if not the end – of traditional, big box retail, let’s remember the good news about the Barbell Effect: It has two fat ends – the bells. On one end of the retail barbell are disruptive companies like Amazon, Google, and any other purveyors of the online retail model. On the other end are small businesses that understand that the online, digital model cannot fulfill all of the expectations of their analog customers. Indeed, the current Barbell Effect is producing a customer experience vacuum that will be filled very profitably by small retailers who deliver the special sauce of the both/and business model: traditional, analog retail (High Touch), combined with online, digital capability (High Tech).

In my next column I’m going to reveal what it takes to maintain occupancy of the fat ends of the barbell, and why this current retail phenomenon is great news for small business CEOs who see the micro-impact of the macro-economy.

Write this on a rock … Blasingame’s Law of Business Love: “It’s okay to fall in love with what you do; it’s not okay to fall in love with how you do it.”




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