Successful Sales Strategies in the Age of COVID
The pandemic has severely slowed down sales cycles in many industries and sales teams are trying to figure out how to win new deals in this difficult environment. Sales leaders are looking at ways to modify their sales strategies to win business while keeping their teams motivated.
In this Coffee Chat episode, we sit down with Chris Hergesell, Managing Director of EY’s business transformation practice to understand how the sales world has change and how sales leaders need to refocus their strategies.
[00:37]: What are the biggest challenges sales organizations are facing right now and what are some of the changes they’ve had to adjust to?
[2:23]: How sales leaders keep their teams motivated and productive during disruption?
[4:28]: Do sales leaders need to make modifications to the compensation plans for their sales teams?
[7:00]: What are the keys to win business in this environment?
[9:50]: Where do you see digital enabling sales and is this something that is temporary or will it have long term impacts to sales teams?
[13:47]: Has sales changed forever?
Loretta Faluade: Welcome to Coffee Chats With the Pros. My name is Loretta Faluade, and I am a solution strategy director at PROS. And today I'm joined by Chris Hergesell, who is the managing director of EY's business transformation practice. Welcome Chris ...
Chris Hergesell: Thank you. Thanks for having me.
Loretta Faluade: I'm excited about this topic because what we want to do today is just really have a conversation around how a sales teams can really be successful in selling, during this disruption, given everything that's happened with COVID. So, Chris, I wanted to kind of jump in and just kind of ask you what are some of the biggest challenges that sales organizations or sales people are really facing right now? And what are some of the changes they've had to adjust to?
Chris Hergesell: Yeah, sure. Loretta, it's really been a very, a turbulent time for sales organizations. And there are a couple of things that we see that have happened. One is that your customer base, your prospects, your existing customers, have all been affected one way or another by this whole Coronavirus, COVID-19 situation. And the impacts have been very, very different depending on what business they're in. And so in some cases they've had hockey stick like growth. In other cases, it's been a hockey stick like decline. So very, very different impacts, which is then also changed really what's important to those customers. So that's really part one. And part two is really the health component of this, which is that if you are a field salesperson and you're going out and you're calling on customers, spending time with them whether it's wining and dining them or meeting with them in their offices.
Chris Hergesell: Well that's for the time being and potentially for the foreseeable future, that's been shot now. And so particularly field sales forces have really had to think hard about how they continue to drive productivity, drive to sales attainment in this environment. And so there's some real fundamental shifts that we've seen in how sales teams have been reacting.
Loretta Faluade: And when you look at the shifts that sales teams have been reacting, or what they've been required to do at this certain point. I know one of the things like you talked about is that they can't be in front of the customer. So they've got to work whether at home and host a lot of virtual meetings, how do sales leaders, how do they keep their teams motivated? How do they keep their teams productive during this whole disruption?
Chris Hergesell: Yeah. Yeah, so what we've seen sales teams do, salespeople is they've really had to shift from being outside salespeople to being inside salespeople, really overnight involuntarily. And so the activities that were previously oriented around going and calling on customers in their offices, now need to be conducted virtually. As we're conducting this zoom meeting here. They need to engage digitally. They need to engage virtually and conduct business via email and Slack. And all the other digital tools that are out there. And so for sales managers, their role to help coach their sales reps on constructing good deals and building trusted relationships with their customers, all those things still hold, but there's an increased focus also on what are the metrics that they should be looking at to drive sales productivity.
Chris Hergesell: And those begin to start looking a lot more like inside sales metrics than traditional outside sales metrics. And so, a focus a little bit more around, how do you act efficiently? How do you continue to drive productivity? And, and so really managing that as a sales manager, as a sales leader, is really the direction that we see that going in.
Loretta Faluade: It's interesting that you've mentioned that the KPIs or some of these metrics really need to be adjusted for sales teams. Would you say that a lot of sales leaders also need to look at their compensation plans or the compensations for sales teams or sales people to make sure that they're now realigned with some of these metrics and they're just not revenue based?
Chris Hergesell: Absolutely. So we've seen a lot of organizations really pause on their compensation programs and this is really more at higher than just a sales management level, or first line sales management level. It's more at an executive management level and looking at how their comp plans are structured, putting together a compensation committee. So they can really begin to monitor compensation for their sales reps. Because remember, while there are sales reps that are being hit really hard, adversely hard, there are others that are killing it. That are just absolutely knocking their quotas out of the park. Because again whether the hockey stick has turned the right side up or upside down depends on really how their target customers are doing. But ultimately from a comp standpoint, really what sales leadership wants to make sure happens is that they retain talent, that they're creating an environment where they are thinking beyond just the immediate shock of COVID. And whether that immediate shock is three months or six months or a year, eventually we'll come out of this on the back end in one form or fashion.
Chris Hergesell: And you do not want to have a decimated sales population. You also don't want to have your salespeople going hungry. So there's some realities around what do you do in the near term in order to keep people competitive, keep them out there, winning business in this new environment. Do you change the metrics? Do you create emergency provisions given that this is a very unusual situation? Do you run a second comp plan in parallel to this as a bit of a backup or create a higher base salary? There are a lot of different ways to solve this, but there are a lot of companies that we see looking at this at this point in time. It's very important.
Loretta Faluade: Yeah. And so now, if you look at sales teams and we've talked about how a lot of leaders can basically look at comp plans, and shift some things to make sure that they're staying motivated and that the impacts to them is not as huge. Now, if you look at as they go and their function as inside sales, and as they're trying to win business, is there a secret, or are there secrets, or are there keys of things that they need to make sure that they're trying to do to actually win this business?
Chris Hergesell: Yeah. My overall observation is that for salespeople who already have an established relationship and who already have a toehold or foothold in a given account, with a given customer, that maintaining that incumbency and growing that position has in some ways become easier. Because they know you, they have kind of that pre COVID recollection of who you are, and they've met you. And so there's some relative strength in that. That really benefits you. If you are selling to a brand new customer, a brand new relationship, where you have not had a chance to meet them in person, and it is an in-person type of sales motion, then selling that new business is more difficult.
Chris Hergesell: And then again, you also have that changed customer behavior now, where there is so much uncertainty that risk-taking has also decreased. And so taking a risk on a new customer, a new sales rep or a new provider, a new vendor, in this environment is probably even more challenging as a sales rep than it was previously.
Loretta Faluade: Yeah. You just brought up a good point because we've looked a lot, and part of what we always think about is the fact that to really grow business during disruption, a lot of organizations really have got to start looking within their existing customer base because it's always easier to sell to an existing customer, than it is to acquire a new one.
Chris Hergesell: Especially now.
Loretta Faluade: Exactly. Exactly. So I think that you hit it right... What do you call it, the hammer, right on the head, in that a lot of organizations have got to start looking at, how do you expand with, a lot of the existing customers they do have. So sorry, I was going to ask you now, with regards to the role of digital. Because I know a lot of vendors and a lot of businesses are looking at digital to help to improve the sales productivity. Where do you see digital enabling sales? And do you see that it's not only going to be something that's temporary, it's going to be something that's even longterm and have some beneficial impacts to sales orgs.
Chris Hergesell: Absolutely. And I think that when we say digital, it means a lot of things to different people. And my definition has always been putting data at the middle of your decision making. And, and so there are components of digitally enabling the sales teams, which relates to having better customer data, customer master data, having better transaction data, having better information about your customers, preferences and needs. Their consumption behaviors, and marketing data, and customer service data. So there are a lot of different aspects to a digital sales effort. There are plenty of organizations who have made heavy investments in CRM. They've made investments in providing mobile capability to their sales teams, allowing them to transact using CPQ solutions and CLM and allowing them to conduct the entire sales motion digitally.
Chris Hergesell: And in this COVID situation, which came upon us pretty swiftly, I would say. The companies that have made those investments were more prepared to make this switch to this new environment than others. And so we see that companies that are lagging in their digital enablement, where they failed to make the investment in CRM and CPQ and CLM and, pricing software, and all the other things that go into a digital sales process, are now realizing that they need to get on the ball. And so then in addition to that, there are a number of other different technologies that also were either invested in or not invested in. And I think about E-commerce, for example, as an alternate channel to market, I think about all of the digital enablement tools, digital marketing tools and your Slacks and your Teams and Zoom and all the other communication tools.
Chris Hergesell: And there really is a disparity in some organizations between those that invested previously and those that, that are just realizing now that they need to make those investments. In the future, as we think about where this goes next, there will be some fundamental shifts we expect in customer buying behavior. Customers will become more comfortable with transacting virtually. And so organizations really need to go where their customers are going. And be able to respond to that. So we really do see kind of a mandate, if you will, a real need for organizations to look at their digital sales infrastructure and how they enable it.
Loretta Faluade: Yeah. And, you know what's so funny, you almost kind of answered the next question that I was going to ask.
Chris Hergesell: Did I?
Loretta Faluade: Yeah. Because part of what a lot of people were trying to figure out is that, is this just short term, or is this actually going to change the way sales functions, even post COVID? And it seems like what you're saying in that it absolutely is. Because a lot of people are now going to be used to the interacting digitally, virtually, and it's going to eventually change the behavior, even when, once we do come out of COVID.
Chris Hergesell: Yeah. And I don't think it's like a... I think there will be aspects of sales that will change permanently. This whole virtual selling component to this. I don't think that face to face sales is going to ever totally go away.
Loretta Faluade: I agree.
Chris Hergesell: There are certain types of sales motions, where you do need to sit in a conference room with somebody, you do need to go out to dinner, you do need to build that trusted relationship. And you can only take so far when your communication is all over Zoom. And so I expect that there will be, it's kind of not a full shift. It's maybe a half shift. But that half shift is enough to make it meaningful. And what I mean by that is, if you sell to small businesses and you've historically sold to small businesses by sending an army of salespeople out onto the street, into the field to go and sell in what is a pre transactional manner.
Chris Hergesell: And now you're doing the same thing using an inside sales function, or maybe salespeople who are involuntarily inside, you will find that having an inside sales organization or having a digital sales capability through E-commerce is a lot more cost effective, a lot more efficient, probably almost as effective. And so particularly on those lower margin type deals or type of customers, you're going to see that move much more digital.
Loretta Faluade: Yeah. Well, thank you so much, Chris. I really appreciate the time. I think there's... Provided so much great insight on where we believe the world of sales is going. So this kind of wraps up this Coffee Chat. Check out our next episode. And until then, I hope you guys have a fantastic day. Thanks again, Chris.