The Sales Learning Curve

I am approached nearly every week by young companies that want to accelerate revenue. Many lack a sales and marketing organization to drive growth and are searching for resources to help them reach their goals. For most of these firms they are in the early stages of a new business or about to launch a new product.

While these firms are anxious to realize "hockey stick" growth rates most are actually a long way from significant growth. The reason is due to the learning curve that rests before them. A number of potential issues that require interaction with customers must be addressed and resolved before growth can occur. These issues may include product fit within specific market segments, packaging and delivery issues, selling process steps and the like.

This learning has been dubbed the Sales Learning Curve by Mark Leslie, CEO of Veritas, the 5th largest software company. The SLC is an adaptation from the Manufacturing Learning Curve that says a number of units must be produced in order to gain manufacturing efficiency and reduce production costs.

The same principle applies to sales development in the form of learning about market and customer driven issues and how they impact sales acceleration.

Learn more about the SLC on another blog and see if it applies to your business.

Sales Teams and Price Increase Initiatives

Our firm has expertise in strategic pricing management which puts us in the middle of working with sales organizations to implement price increases. I can tell you that it is easier to get customers to accept price increases than it is to get sales professionals to get higher prices.

But, it doesn’t have to be that way. We have worked with dozens of companies to implement price hikes. There are several techniques and tools that can make sales professionals become your strongest supporters of pricing initiatives. Here are just a few tools that can make the job a lot easier...

1. Most sales professionals are compensated based on revenue achievement. Consider adding a price level component to the incentive plan. Reward the rep when he sells a product or service at a higher price. There are several types of compensation plans that can be adopted here. Some are implemented on a temporary basis to reward the rep during the duration of the price increase period while others are permanent and reward on an on-going basis.


2. Set average price levels for products and services. Then, track the pricing of each sales rep against the average and post the results for other reps to review. Most sales professionals are competitive and will respond to these scores. No rep worth his weight will want to be below average.


3. Pilot test a price increase with a few of your best sales professionals. Select those reps that you know will embrace the initiative and make it successful. The others will see the success and follow accordingly.

These are just a few of the techniques that we use to implement price increases. There are many more tools that can be effectively executed to improve your return on investment.

Good luck!

Technololgy Sales Stat

Sales & Marketing Management magazine reports that 53% of business professionals check blogs before making technology purchases.

The data was created by Knowledgestorm and Universal McCann’s “Emerging Media Series: Blogs and Real Simple Syndication” survey of 4,500 business professionals.

Market Development Is Not Sales

Developing new markets is not like selling to existing, well established markets. Expanding into new markets most often requires dedicated marketing and sales resources that are focused on learning and understanding the nuances of a different marketplace.

All too often, companies utilize their existing sales team to address new markets and fail to achieve the growth and market position that they desire. While sales teams can sell into new markets once the market is developed, the development of these markets requires skill sets that are more focused on learning, analysis and adaptation.

Sales teams that are focused on managing existing customers are typically consumed in customer demands and issues and don’t have the time that is necessary to develop new markets. Applying a focused effort over a shorter period of time with the right skill set will yield better results than borrowing resources on a part-time basis.

Relationships or Process?

I was recently approached by the sales director of a small B2B company that was launching a new product in the U.S.. He was searching for sales representatives that held personal contacts within the markets that his firm targeted. His reasoning was that the sales representative could open doors that would lead to new sales for his firm. Certainly, this strategy has been successfully used for decades. Sales reps nurture relationships within specific market spaces that become their equity in business.

The pattern that often emerges with a relationship based strategy is an initial burst of introductions to new prospects followed by a steady decline in activity as the representative exhausts their inventory of viable contacts. Today, the pattern is accelerated as decision makers are more transient in many industries. Even the best sales representative has limits to his network. Add buying teams, multiple locations and global organizations and the challenge to maintain relationships with all the right people becomes difficult to say the least.

We are witnessing more companies, especially smaller to mid-sized firms, embracing a commercialization process as a means to create new business. A process approach recognizes all the steps necessary to acquire new business beginning with creating awareness to consideration to preference to initial orders to filling repeat orders. There are many additional process steps that can be added. When a firm can define the process for its own business it is taking the first steps to control its own growth. Once a process is defined the dependence on specific individual sales representatives diminishes as process steps and the roles of individuals are clearly defined and can be implemented by anyone with an appropriate skill set.

The firm now has control over obtaining new business as opposed to relying on individual representatives contact network. This helps to eliminate the problem when a star sales representative leaves a firm and the ability to create new business goes with him. By defining a commercialization process you are essentially creating a business development machine that you own and control. The power to generate revenue growth now resides within your firm and not in the hands of individual sales representatives.