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Sales Strategy – Introduction Case Study Subject: Sales Strategy Date: Summer 2007 Authors: J. Frank Brown / Herminia Ibarra INSEAD: The Business School for the World As one of the world’s leading and largest graduate business schools, INSEAD brings together people, cultures and ideas from around the world to change lives and transform organisations. The unique global perspective and multicultural diversity of INSEAD are reflected in all aspects of its research and teaching.

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Sales Strategy – Product <ul><li>Employee Management System </li></ul><ul><ul><li>sold on an annual license fee </li></ul></ul>

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Sales Strategy – Strategy 1 - 4 <ul><li>Value Proposition </li></ul><ul><ul><li>Cut Costs </li></ul></ul><ul><ul><ul><li>through increasing productivity and controlling absenteeism </li></ul></ul></ul><ul><ul><li>Reduce Workload </li></ul></ul><ul><ul><ul><li>by streamlining staff management and regulatory compliance </li></ul></ul></ul><ul><ul><li>Attract & Retain Staff </li></ul></ul><ul><ul><ul><li>using flexitime and benefit management </li></ul></ul></ul><ul><li>Valued Customers </li></ul><ul><ul><li>Networked Computer Environment </li></ul></ul><ul><ul><ul><li>software product no hardware = less maintenance & third party reliance </li></ul></ul></ul><ul><ul><li>Less than 75 Employees </li></ul></ul><ul><ul><ul><li>not targeted by competitors + faster set-up & deal closure </li></ul></ul></ul><ul><ul><li>Management Structure </li></ul></ul><ul><ul><ul><li>not company of equals, needs management structure even one person </li></ul></ul></ul>

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Sales Strategy – Strategy 2 - 4 <ul><li>Buying Behaviour </li></ul><ul><ul><li>Initiators </li></ul></ul><ul><ul><ul><li>person in charge of managing the staff ( owner manager, hr manager, office manager ) </li></ul></ul></ul><ul><ul><li>Buyers </li></ul></ul><ul><ul><ul><li>initiator or the owner manager, usually a single person no tenders or committees </li></ul></ul></ul><ul><ul><li>Users </li></ul></ul><ul><ul><ul><li>used by all staff members, managers gain the most </li></ul></ul></ul><ul><ul><li>Influencers </li></ul></ul><ul><ul><ul><li>cost controller, managers, hr managers </li></ul></ul></ul><ul><ul><li>Lodge keeper </li></ul></ul><ul><ul><ul><li>Initiator or the owner manager </li></ul></ul></ul><ul><ul><li>Deciders </li></ul></ul><ul><ul><ul><li>initiator, secondary cost controller </li></ul></ul></ul>

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Sales Strategy – Strategy 3 - 4 <ul><li>Sales Objectives </li></ul><ul><ul><li>Focus on Recruitment </li></ul></ul><ul><ul><ul><li>Business model is about growing a large customer base </li></ul></ul></ul><ul><ul><ul><li>Product is sold on an annual fee, so a large sales effort in focused on gaining new customers, to build up the annual revenue stream. </li></ul></ul></ul><ul><ul><ul><li>Recruitment of new customers would be at a loss due to the amount of effort required but it would be recouped by the customer renewing the product each year. </li></ul></ul></ul><ul><ul><ul><li>Due to the product becoming part of a companies operations, renewals will be a less taxing effort on the part of the sales team. </li></ul></ul></ul>

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Sales Strategy – Strategy 4 - 4 <ul><li>Delivering Profitability </li></ul><ul><ul><li>Operational Excellence </li></ul></ul><ul><ul><ul><li>Company will have the best general product. </li></ul></ul></ul><ul><ul><ul><li>Company's price will be the best in the market. </li></ul></ul></ul><ul><ul><ul><li>The modular pricing structure will make the product available to companies of all sizes. </li></ul></ul></ul><ul><ul><ul><li>Product will be easiest to use and have a speedy set-up time </li></ul></ul></ul><ul><ul><ul><li>Company sells 'their' product to customers, there will be no bespoke development </li></ul></ul></ul><ul><ul><ul><li>Updates to the product will be carried out as required to keep the product functional and competitive. </li></ul></ul></ul>

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Sales Strategy – Culture/Chemistry <ul><li>Tough Manager </li></ul><ul><ul><li>Focused on costs views employees as a tool to generate profit </li></ul></ul><ul><ul><ul><li>Sell the improvements in productivity </li></ul></ul></ul><ul><ul><ul><li>Sell the controlling of absenteeism </li></ul></ul></ul><ul><li>Analytical Manager </li></ul><ul><ul><li>Focused on logic and structure </li></ul></ul><ul><ul><ul><li>Sell the overall benefits of the product to the company and staff </li></ul></ul></ul><ul><ul><ul><li>Show details of how the company will benefit from using the system </li></ul></ul></ul><ul><li>Friendly Manager </li></ul><ul><ul><li>Focused on the welfare and needs of the staff </li></ul></ul><ul><ul><ul><li>Sell the ability to better manage the staff and provide them with a more supportive environment </li></ul></ul></ul><ul><ul><ul><li>Sell the flexitime advantages to staff and company </li></ul></ul></ul>

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Sales Strategy – Operations <ul><li>Sales Funnel </li></ul><ul><li>Selling Approach </li></ul><ul><ul><li>Consultative & Strategic </li></ul></ul><ul><ul><li>Relationship Lead </li></ul></ul>Sale <ul><li>Infrastructure </li></ul><ul><ul><li>Technical Support </li></ul></ul><ul><ul><li>Product Build Process </li></ul></ul>Total Market: use sector websites and list services Qualify & Identify: ensure they are valued customer and identify initiator Capture Interest: using direct marketing Contact: phone call using a consultative approach Meeting: build relationship by understand their needs D emo of Product Sale Renewal

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Sales Strategy – Performance <ul><li>Measuring Sales Process Outputs </li></ul><ul><ul><li>Company Key Performance Indicators </li></ul></ul><ul><ul><ul><li>Total Market 40 </li></ul></ul></ul><ul><ul><ul><li>Qualify & Identify 20 </li></ul></ul></ul><ul><ul><ul><li>Capture Interest 20 </li></ul></ul></ul><ul><ul><ul><li>Contact 10 </li></ul></ul></ul><ul><ul><ul><li>Meeting 4 </li></ul></ul></ul><ul><ul><ul><li>Demo 2 </li></ul></ul></ul><ul><ul><ul><li>Sale 1 </li></ul></ul></ul><ul><ul><li>Identify the areas where the biggest loss of potential customers occur and look at ways of refining the process in that area to improve overall sales performance. </li></ul></ul><ul><li>Measuring Sales Process Inputs </li></ul><ul><ul><li>The KPI's will change over time as the companies KSF change </li></ul></ul><ul><ul><ul><li>Larger Customer Base = greater product awareness and an increase in sales </li></ul></ul></ul><ul><ul><ul><li>Controlling Costs = ability to reduce price of product and an increase in sales </li></ul></ul></ul><ul><ul><ul><li>No bespoke development = a reduction in the number of sales </li></ul></ul></ul><ul><ul><ul><li>Constant Contact with Customer = better feedback and an increase in sales </li></ul></ul></ul>

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Sales Strategy – Enterprising <ul><li>Value Curve </li></ul>

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Sales Strategy – Key Success Factors <ul><li>Bases of Competition (BOC'S) </li></ul><ul><ul><li>Competitive Price </li></ul></ul><ul><ul><ul><li>Overheads Control & Efficiency </li></ul></ul></ul><ul><ul><li>Product Quality </li></ul></ul><ul><ul><ul><li>Customer Needs & Usability </li></ul></ul></ul><ul><ul><li>After Sales Service </li></ul></ul><ul><ul><ul><li>Keep in contact with customer </li></ul></ul></ul><ul><ul><li>Tailored to Customers Needs </li></ul></ul><ul><ul><ul><li>Bespoke Development </li></ul></ul></ul><ul><ul><li>Reassurance </li></ul></ul><ul><ul><ul><li>Company Reputation & Customer Base </li></ul></ul></ul><ul><ul><li>Sold on Modular Basis </li></ul></ul><ul><ul><ul><li>Technical Control over Product </li></ul></ul></ul><ul><ul><li>Annual Payment </li></ul></ul><ul><ul><ul><li>Cash Reserves & Financial Strategy </li></ul></ul></ul>

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Sales Strategy – Key Success Factors <ul><li>KSF Analysis </li></ul>