Dispatches from the Frontline

Readers of this weblog are familiar with my belief that because the end result of selling is inherently quantifiable; salespeople suffer from a tendency to avoid objective measurement and accountability along the path to that end.

For most of our clients, this disconnect is most evident in the relationship between sales and marketing where both parties tend to question the value of the other.

In our Sales Augmentation (outsourcing) practice, we view ourselves as the ally of marketing simply because it is our job to turn interest into opportunities. Our approach contrasts sharply with the typical sales-marketing interface wherein the sales team often views marketing as the scapegoat (‘We need more leads!’ , ‘None of these leads are any good.’, etc.)

It is not surprising to us when, during the course of a client engagement, we find the marketing team throwing stones over the wall to question the value of our services (particularly if we have not done enough to assure them that we are on their team.)

Fortunately, we pursue selling from a highly objective and data-centric approach. By way of example, I wanted to share an email from one of our Client Leads to the client sponsor (in this case the VP of Sales) who was under fire from the marketing team questioning the value of investment in our services. Naturally, names have been changed to protect the innocent.

Enjoy!


Jeff,

Robert forwarded your email regarding our team’s progress to date and I wanted to provide some specific data for your reference.

As the contract calls for, we are staffing 2.5 full time equivalents (FTEs) on the project. This represents 400 total person-hours per month. Two of these resources are dedicated appointment setters and Robert is a senior management resource. While I understand your marketing team’s concern over expense, it seems to me that return on investment (ROI) is a more appropriate basis of comparison.

In this context, I believe it is fair to compare our cost and results with standard marketing efforts and, to date; our results represent a superior return on your company’s investment.

I imagine you typically spend $15,000 on a direct marketing campaign to target 10,000 prospects. These days, a response rate of 1% represents a typical yield and should result in 100 provisionally qualified (interested) prospects. These ‘suspects’ - as we refer to them – still require a salesperson to contact and qualify. As you know, a white paper download or simple response to a direct marketing campaign is still a long way off from an actual sale. You must have a large quantity of these initial contacts to progress to a demo and even more to generate a closed sale. I would recommend you ask your marketing department to provide metrics on the historical ratio of interested prospects to booked revenue. My guess is their visibility (and accountability) ends with the raw lead.

More to the point and in your case, inbound leads have been generated but in most cases never followed up on. They have, for lack of a better term, fallen on the floor. I believe money spent generating interest that never delivers actual revenue represents a poor return on investment to say the least.

Contrast this with our results to date: in the first 21 days we have made 2,200 outbound calls, scheduled 26 discovery meetings resulting in four highly qualified opportunities, one web demo, one onsite meeting, and roughly $700k in probability adjusted revenue pipeline. If your stated demo to close ratio is close to what you usually expect, we will more than justify the cost of our services.

Here are the evaluation criteria I might use if this were my business. The cost of engaging 3VL for one year represents roughly $240,000. If we generate $1M in net-new opportunity that would have never been captured otherwise, would that represent a positive return on investment? Of course it would…

Kind regards,

Greg Schwarzer