Getting down to business

Time is not on the side of the sales team, so marketing is under pressure to deliver better qualified leads. David Reed finds out how business data owners are supporting this new merged process.

If you work in a large enough organisation, your business development process has probably looked something like this. Marketing encourages people to raise their hands, perhaps by registering for a webinar, requesting product information, or even asking to be contacted. Details of these qualified leads are then passed to the sales team who develop the contact until they convert.

Smaller organisations have never had the luxury of such an approach. Through lack of resources (or even skills), the sales and marketing function has often been one and the same. Identifying potential leads, qualifying them and closing the deal are all part of a single process, usually handled by the same person, with no hand-off in between.

Where larger companies and SMEs have come to ressemble eachother in their business development is that neither has time to spare. Current market conditions dictate that if a prospect is interested, they need to be sold to and closed as fast as possible.

That has important implications for the data being used in this quick-fire selling and therefore for the business data owners providing it. If the distinction between sales and marketing has collapsed – or was always wafer thin – then what information do B2B suppliers need to offer and how should they deliver it?

“The space between sales and marketing is where we sit,” acknowledges Tony Pringle, managing director, UK and Ireland, for Bureau van Dijk. His company has a client base of companies of every size, making generalisations difficult.

Sales directors used to call financial directors ‘the sales disabler’

But Pringle notes: “Historically, the approach has been one of the sales force as a hunter. They would have more say in the data because the sales team are looking for opportunities to target. However, a large number of businesses see their sales people as farmers – looking for warmer leads so they are saved a lot of the hard work of knocking on doors.”

What is changing in both environments is the need to be efficient so that more leads get converted with less sales time expended. Sales is a notoriously inefficient job with as much as 90 per cent of a sales team’s time ultimately not generating new business. Anything that can be done through better use of data to reduce this – even by 5 or 10 per cent – results in significant benefits.

“We’re at a stage now where sales people have to be financial analysts. They have always been interested in financial data on a company’s size and growth. Now they are becoming more aware of risk factors,” says Pringle. Tony Pringle

BvDBvD provides credit scores as part of the company profile data it supplies. Looking at these risk ratings prior to engaging in sales calls improves the likelihood of a new contract being approved and reduces the likelihood that the finance department will turn down the customer. “It enables sales people to make that decision before they pick up the phone,” he says. His company also carries CCJ data for UK companies and has recently added risk data to its European set to reflect growing demand for risk profiling.

That level of sophistication recognises business development as a lengthy process. It starts by identifying cold prospects and only ends once a deal has been signed, accepted by the finance department and perhaps even to the point where the first invoice has been paid. Sales teams are increasingly remunerated against an element of risk, so if a new customer defaults, they don’t get their bonus.

While data exists from single sources to support the entire breadth of that process, not every company is in a position to act on it. “In our experience, there are two clear types of SME – micro-businesses with fewer than 12 people, where there has been no collapse between sales and marketing because the distinction never existed, and SMEs employing up to 500 people, where there are separate functions, but we are seeign a blurring of the lines,” says Richard Lloyd, managing director of infoUK.

Despite these differences, both groups face the same pressure to be efficient and deliver new business. That has converted into a pushback on B2B data suppliers to support a quicker, and also more aggressive, sales process.

“The traditional way we’ve produced data is as a broad based list of thousands of records for the marketing process. Now we find in a significant number of cases that every one of those records is being called by sales,” says Lloyd. For data owners, this is very exposing of the data’s quality. Whereas the marketing process could tolerate a small degree of error, sales team are quick to complain if even one record is wrong.

Now we find that every one of those records is being called by sales.

Another big shift is also underway. “There is a requirement for us to go further down the sales process for them,” says Lloyd. If in-house marketing is no longer being used to warm up leads, for example by getting targets to visit and register on a website, then it is down to the data owner to drive this qualifying process.

“In return, clients will pay a higher rate per conversion. But they want the data owner to reduce their risk,” says Lloyd. Some B2B data owners had been travelling down this route – in effect becoming an outsourced marketing team – before market conditions Richard Lloyd

InfoUKchanged. Others are rapidly adapting to the new model.

The change could be a difficult one – and not only for data owners. The mid-market has never been that good at defining and streamlining its business processes. So facing up to new market conditions which require a fresh approach is made harder, since it is difficult to re-engineer something you can not identify.

In a quick study of marketing executives carried out earlier this year by marketing automation vendor Eloqua, 41 per cent said that their sales and marketing organisations are not currently aligned. “If you align marketing and sales with a common definition of a lead and shared data, you get better outcomes,” says Stuart Wheldon, director, EMEA, client services at Eloqua.

He argues that companies should draw up a service level agreement about what each function will provide and what definitions are to be used in order to generate a common language for both sides to use. The application offered by his company often becomes the “marketing database of record” around which sales and marketing processes, as well as CRM, are then centred.

“A key issue for sales is that marketing may have run great communications which have generated leads, but when will they be passed across? Leads also need to be scored as part of the qualifying process – sales managers need to know the data they are getting meets what has been agreed to,” says Wheldon.

It is fair to say that, in the current market, less effort is being expended on developing B or C-grade leads, which might turn into a long-term customer, than in closing A-grade leads. Doing that efficiently does require a strong process, possibly an good quality data to start with.

What B2B data owners are now offering is a much richer insight into the organisations on their databases, whether at a corporate level, through risk and financial indicators, or at individual level. To bridge the gap between sales and marketing, data has to meet to very different needs.

“Typically, marketing wants business information with SIC codes, turnover, contact data and organisational structure to map out the marketing plan,” says Steven Shove, vice-president of OneSource Information Services. A key role for marketing is to ensure that the CRM system is populated with accurate data for the sales team to pull off.

“On the other side is sales management. They want to have more information about the individual, as well as the company, especially if they are trying to do business with them for the first time,” he says. Knowing the background and career path of the prospect is a very valuable tool for finding the right angle in a sales conversation.

They want more infomation about the individual, as well as the company.

It is this additional, editorial dimension that is one of the strengths of OneSource. By using the business demographics to drive the targeting of sales effort and the personal demographics to define the conversation, “you get through the awareness, interest and desire phase and into action far more quickly,” says Shove.

That reflects the fact that, even in an era where lead generation is the buzzword, business sometimes has to be developed the old-fashioned way, through steady contact, learning about the prospect’s needs and identifying how to satisfy them. “That is one of the things we have done with our own sales team, so we earn the right to ask questions, spend time interpreting the answers and coming up with better solutions,” he says.

Harvard Business Review has writen about this as a move from solutions selling to “provocative selling”. Business data has a key role to play in pointing out where to apply the right sort of provocations, having profiled a company and its executives. “People who do that will have quicker sales cycles,” says Shove.

The fact that speed to sale is everything is “a sign of the times,” acknowledges Justin Elliott, marketing executive at Corpdata. “Clients are looking to close the sale as early as possible. As soon as marketing has got a lead and qualified it, they are sending them to sales.”

He says some companies are taking that process even further so marketing takes on the pre-sales element, leaving sales as a pure closer, rather than sales taking over the qualifying steps. “Sales and marketing have the same target – to get more sales and business. So they are both looking to get better qualified data,” says Elliott.

Corpdata has enhanced its data set with risk information in the last few months to enable this change. Elliott also notes that more clients are taking 12 month data licences, rather than one-time usage deals, so they can do more profiling and development before the sales team gets to work.

Paul Westcott, head of products and services at ICC, believes that the long-term impact on business processes of the new market conditions will not just be limited to sales and marketing working more closely together. “Financial directors and sales directors have never been as closely aligned as they have become in the last 18 to 24 months,” he says. “There is no point trying to develop business that could go bad.”

“In the past, sales directors used to call financial directors ‘the sales disabler’. Now they are more aligned to ensure that sales efforts are giving the right outcomes,” he says. His company has credit and risk information within its marketing services proposition to provide credit scores and payment histories.

This is important not just as a negative filter, but also for positive targeting. “The cashflow relationship is an important consideration. You may have good payers you can extend credit to, while selling goods on different credit terms to others who pay less well,” says Westcott.

Perfect data has always been an objective for data owners, ensuring they get the contact information and demographics exactly right. With the overlaying of financial and risk parameters, they are moving beyond this quality consideration and towards a more complex goal – providing data that is fit for purpose. As sales and marketing collapse into each other, that is becoming a more difficult definition to agree on.