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Price Pressure: Is Your Sales Team Ready to Meet the Challenge?

According to recent research from ES Research Group and Corporate Visions…

72% – of salespeople say buyers have gained more power over sellers in the past three years.
88% – say the amount of price pressure from customers has increased in the past three years.
46% - admit to giving away too much, too soon, before executives get involved.

The result? Painful contract negotiations and low margin business.

To turn this trend around, you need to fundamentally rethink how your team sells and negotiates with your customers. Watch this 4-minute video to find out how:

Click here to download Profitable Negotiating: It’s Counterintuitive

 

How to Read an Annual Report in 20 Minutes to Gain Sales Insights

Written in everyday language, your customer’s Annual Report to Shareholders offers a wealth of easily understood information to learn about your customer’s business and inform your sales strategy.

Use these shortcuts to capture the information most relevant for sellers.  In the upcoming Part II of this series, we’ll share a similar exercise using your customer’s other annual report, Form 10-K.

1. Start with the Letter to Shareholders

The Letter to Shareholders is your best source of information about your customer’s business.

Although published only once a year, the external factors, business initiatives, and financial metrics it cites generally have long-term applicability.  Check your customer’s Investor Relations website to ensure you have the most current version and note when the next Annual Report will be available.

Look for the following:

  • External factors: What are some of the market factors outside of your customer’s control that are impacting all of the companies in their industry?   Examples are everywhere: regulatory requirements, customer trends, interest rates, fuel prices, exchange rates, etc.

Action >  Reference external factors early in customer conversations to demonstrate you understand their business and to establish your credibility

  • Business Initiatives: What strategic initiatives has the customer identified as essential to their growth plans?

Action >  Link your value proposition to achieving your customer’s stated business initiatives.

  • Forward-looking statements: What insights can be gained into the company’s future plans?

Action Position your business case to foster a long-term customer relationship.

  • Business metrics: What financial metrics, ratios or prior-year successes are highlighted?

Action >  Quantify the value of what you’re selling using these metrics.

  • Significant trends: Are any market, product or divisional trends discussed that align with your solutions?

Action >  Preempt your competitors by being the first to engage with new ideas

 

2. Next, Review the Financial Statements

  • Income Statement:
    • What was the company’s revenue trend over the past three years?
    • Did any significant product or service mix changes occur?
    • Did a significant percent of revenue change occur by region or business unit?
    • What was the company’s gross margin trend over the past three years? Did any significant year-over-year percentage changes occur by region, business unit or product segment?
    • What was the company’s profitability trend over the past three year

Insights >  Any of the above that show a downward trend represent a selling opportunity.

    • Assess the percent of revenue for each major expense category: R&D, sales and marketing, general and administrative, and any others that apply

Insights >  Line items showing an upward trend also represent a selling opportunity.

  • Balance Sheet:
    • Over the last year, did the company’s total assets grow or shrink?
    • Did any significant asset categories (accounts receivable, inventory, etc.) record a notable change in balance?

Insights >  Any asset category (other than cash) that shows a growth trend represents a selling opportunity because decreasing non-cash assets improves cash flow,  making cash available for other investment.

Wherever you can correlate asset category trends to income statement trends there’s a selling opportunity.

 

3. Scan Other Parts of the Annual Report

  • Management Discussion & Analysis (MD&A):
    Whether you’re already selling to a Strategic Business Unit, or looking to identify a SBU as a point of entry, the MD&A describes high growth areas.

Look for the following:

  • The results of operations
  • Changes in financial condition
  • Risk management strategies

Insights >  High growth areas represent a selling opportunity.

  • Notes to Financial Statements: 
    These notes are integral to the financial statements.  In addition to harboring hidden opportunities, they’re also useful for explaining financial trends.

Insights >  References to relationships, contingencies or other factors provide effective data points for strengthening your business case and aligning your solution’s value.

 

20 Minutes Well Invested

Regularly reviewing your customer’s Annual Report to Shareholders is not overwhelming or impractical to incorporate into your sales process.  In fact, it can be done in as little as 20 minutes per year.

Recognizing that most sales professionals make poor use of this rich resource, using insights gained from Annual Reports can place you on a platform far above your competitors.

 

Tim Riesterer dishes on “zombies” and the “unloved”

Although it may seem that our Chief Strategy and Marketing Officer, Tim Riesterer, has watched a few too many episodes of AMC’s hit TV show, The Walking Dead, we assure you that he’s still focused squarely on helping companies create more sales opportunities.

In a recent article, Tim discussed tactics for engaging with leads that have languished in the pipeline. He suggests handing “zombies” – leads in your database that haven’t looked at any of your communications recently – to your salespeople to reengage with some provocative phone calls.  As for the  “unloved”  – leads that have been given to sales, but haven’t been converted to the pipeline  –  reach out to the “unloved” with sales conversations packed with visual messages that force them to reconsider their status quo.

For more on “zombies” and the “unloved,” read the article, Spring Cleaning for Marketers: Zombies, Unloved Leads, Email Upkeep and More, in DM Confidential.

 

Tim Riesterer is guest speaker for complimentary Sales Benchmark Index webinar tomorrow

Tim Riesterer, our chief strategy and marketing officer, will be offering his sales and marketing messaging expertise in tomorrow’s free webinar, “Make Your Number by Defeating the Status Quo,” sponsored by the Sales Benchmark Index.  During this 30-minute webinar, Tim will explain why a company’s greatest obstacle in the sales process isn’t another competitor, but is the status quo – when prospects do nothing.

Tim will discuss the tools you need to defeat the status quo. You’ll learn how to recognize the status quo, find your “value wedge” —what you can do for a prospect that is different than what the competition can do – and create winning sales presentations.

Join Tim tomorrow, March 21, at 1:00 p.m. CST to learn how your company can change “no decision” prospects into sales opportunities.  Register now to attend.

 

Finding your Magic Eye

 

 

 

 

 

 

 

 

 

 

 

Remember Magic Eye  pictures – the headache-inducing, 2-D pictures that masked 3-D images, that were all the rage in the ’90s? At first glance, the picture looks like a flat, colorful, trippy pattern. Interesting, but nothing special. But with some practice and  technique – which some never master – a distinct and formerly hidden picture emerges in 3-D and it seems impossible that you didn’t see it at first glance. And once you’ve seen it, you can call it into focus almost immediately.

Your job as a marketer or salesperson is to tease out that 3-D picture in your hyper-commoditized or perceived-parity market and make it emerge from the sea of sameness around you for your prospects to see.

Discovering for yourself

Much like trying to locate that hidden image, you need to dig deep into your company and figure out what it is about your services or products that makes you truly stand out from your competition. The image that materializes is your Value Wedge – the sweet spot where your company in uniquely positioned to solve a problem that your prospect didn’t know about or didn’t fully recognize. It’s something that is important to your prospect, unique to you, and easy to defend.

Showing others

Once you’ve identified that differentiation, you need to communicate your value. Many people cannot see the 3-D image at first. They either don’t bother looking and just take the picture at face value, or they stare hard at the picture willing something to pop out. They need someone to convince them that it’s worth looking at, and then show them how – let your focus blur a bit, look through the page, move the picture slowly away from you. You must do the same for your prospects. Make them understand the urgency of changing how they view things, and then show them that you, better than all others, can help them realize their vision.

Power of the visual

And, of course, the magic of the Magic Eye is the power of the visual. Seeing that 3-D image expand off the page is mind bending – your brain is stimulated and engaged – and it forever changes your perspective without using a single word. Visual communication is undeniably effective and makes a lasting impression.

With considered and thorough self-analysis, a powerful story, and a well-planned marketing and sales strategy for communicating that story visually, you can alter your prospects’ perspectives and show them how you stand out from the crowd. Your competition – be it another company or the status quo – will remain unremarkable in its 2-D existence, while you swoop in and impress your prospects with the magic of the 3-D world.