Below is an excerpt from the transcript of SLMA Radio on the SLMA Live Network hosted by Jim Obermeyer and featuring QuotaFactory’s CEO and Co-Founder, Peter Gracey. You can access the full radio program that aired on January 19th, 2016 here. The following excerpt is part two of three parts of the radio program titled: “How to get a 60% Increase in Conversions to Forecast!” Enjoy! And, as always, please share your thoughts or questions in the comments section below.
Jim Obermeyer: Today we are trying to tackle the problem of how to get a 60% increase in conversions to forecast. So Peter, tell me a little bit more. Do you have any case histories that you can share with us?
Peter Gracey: I do. So it happens quite often, Jim, when we enter into an engagement on the outsourcing side of our business where it evolves into a consulting relationship. We might bring in a partner like The Bridge Group and actually have to help a client re-engineer how they are conducting their sales efforts, the structure of their teams, and basically the entire infrastructure that we are supporting.
Conventional wisdom says, if I need more sales, I am going to have to hire more salespeople. And this will be counter-intuitive to what a lot of people think and a lot of your listeners might disagree with that but that’s good because it’s a good dialogue to have. I deal with just the opposite.
You should be investing the preponderance of your funds into improving the inbound lead flow for marketing and into staffing up and building your sales development function.
I believe in a 2:1 ratio. Meaning, you have two sales development representatives for each quota carrying individual on your team. It might seem like overkill, but when you do it this way you end up being much more picky about the sales talents you bring in the door. You end up with fewer, but far more talented, salespeople whose calendars are stocked with fully qualified appointments that have been provided from marketing and your sales development team.
That’s what we did internally to drive our own opportunities to forecast by 60% and that’s how we educate and coach our clients to do it so that they can realize the same benefits.
Jim Obermeyer: So, invest your funds in improving the overall sales process, which includes the inbound lead flow and staffing, to fill sales development positions and to make senior sales reps much more effective. Can you tell us who’s done this or at least give us an example?
Peter Gracey: I will give you my own team. I did that about 5 ½ years ago where we actually were having the same issue and we switched to that model with tremendous success. I have seen companies like BMC Computer Associates, who are clients of ours, that actually went down this exact same path. They emphasized the investments they were making in lead flow and lead qualification over the investment in just acquiring new heads to close deals.
Jim Obermeyer: I talked to someone recently who had launched their company a couple of years ago with 12 sales reps in the US and a very high-priced product. After two years, they were down to six and three of those reps were new. They had also gone through several sales managers and when I really looked at it deeply, I asked “what has been the lead flow coming in?” They said, “well, we hired senior salespeople, that was their job.”
So they had these people getting paid maybe $150k a year, really top-notch guys. I said, “you hire the right people, but you don’t have the right marketing programs.”
Peter Gracey: Yeah, it is the oldest analogy in the book, the square peg in a round hole right? You are taking that senior-level salesperson who maybe, at one point in time, had a job early in their career where he or she was generating opportunities by cold calling. That might have been 15 years ago. It’s really hard to get that type of person be engaged and to do it at the necessary scale at a senior point in their career.
[Tweet "A great salesperson is always making calls, are always on the phone and are happy to generate some of their own demand"]
Any great salesperson is always making calls, they are always on the phone and they are happy to generate some of their own demand. But, they are never going to do it at the volume and at the scale that your company needs them to do it at in order to hit quota. So, you have to invest in doing it for them.
Jim Obermeyer: So many times they hire salespeople based on the Rolodex which may or may not be pertinent to the current products even though it’s senior-level people. I don’t always get into products but how does QuotaFactory’s technology enter into this?
For Pete’s answer, stay tuned for the transcript of part three of Jim and Peter’s radio program conversation. If you can’t wait that long, listen to the full recording below:
Stay tuned for the transcript of part three of Jim and Peter’s radio program conversation!