Sales in the 21st Century
As technology and empowerment breaks down barriers across domains and specialties, what happens to the good old sales person? Maybe this is all common knowledge, but for an engineer, its about starting from first principles!
Building products, specially software, has become radically different in the internet age. Whatever you need to know is in a blog post or YouTube video somewhere. Even better, there are tons of open source repositories with top class code directly accessible to you. All you need to do is, keep honing your skills and keep learning and iterating on your product. Software building tools and libraries make you so productive, that there is no more a front-end or back-end developer, or database administrator, or webmaster everyone these days is full stack.
How has this breaking down of barriers affected more customer facing roles like sales? From whatever I see around in various companies, sales still works on a traditional model. Driven by spreadsheet-projection-driven-alpha-business-leaders, sales people are supposed to be chasing customers, with the goal of closing a sale. Driven by targets and large commissions, sales is also associated with persuasion and working on a customer and get them buying something they probably may or may not want, because making money is good. This model is clearly not ideal.
We have started our sales journey too, but we want to think about how we go about it. In a generation where customers have access to everything they need know (maybe on a blog post or YouTube video), what should be the role of sales?
History of Sales
Sales is a very modern profession, an invention of the industrial era, and probably a very American one. Traditionally, before mass transportation and communication, there were tradespeople, not sales people, and their job was discovery. My great-grandfather set sail from the port of Karachi (then part of India) to London a century ago, and brought back with him surplus jackets from the 1st World War, that he sold for a handsome profit back home. The profit was the reward for undertaking a risky journey and making it back. Tradespeople had access to capital and goods that their customers wanted, so all they needed to do was to show up at a marketplace. You still had to position your ware, pick your spot, make strategic sales and adapt, and the skill was to find an opportunity and show up.
[The industrial era]… ushered in what we know today as the “modern day salesman” — the traveling salesmen (a.k.a. the snake-oil salesmen). Now for those of you who do not know what snake oil is, well, it’s the cure-all potion that turned you into a new person. Snake-oil started being used by the railroad workers who would lay track all across the country. Their bodies would hurt, their muscles were sore, and their bones would ache — so, they needed something to cure that pain. In comes snake-oil and the traveling or exaggerated salesmen. They were showmen, they made big, exaggerated claims, sold the snake-oil elixir, then would high-tail it outta town and move on to the next one.
As economies became complex and choices became bewildering, sales people helped customers to navigate new products. Growth of the middle class and increasing disposable income meant people could afford to buy things they did not really need, and what better than buy it from the most entertaining sales person. Then came on Dale Carnegie:
How to Win Friends and Influence People — this book written in 1936 by Dale Carnegie was the first of its kind. It’s a self help book but naturally, salespeople gravitated towards it. It really started the techniques of selling — how to connect with people, how to persuade people, how to influence people. It talked about how to get people excited about things and have a winning attitude towards life and your job. And… it was all in lists — 12 ways for this, or 6 ways to do that. A great, easy read and most of what Carnegie writes is still quite relevant today.
But this sparked a movement in sales, you could actively use and improve your techniques to get people to buy your products or services. You, as a salesperson, could control the outcome of a consumer transaction by implementing psychological tactics. It wasn’t rocket science, but it was still pretty genius!
Sales become one of the hottest professions, and the fastest way to make more money and become part of the American Dream. The best entertainer became the best sales person. At a time, success was so much guaranteed that if you failed as a sales person, it was considered your personal failure. The dark side of which is beautifully captured in Arthur Miller’s Death of a Salesman.
Relevance in the Information Age
For most simple, consumer products, the customer makes choices based on availability, price and positioning. The role of the sales person has become very limited in such cases. The sales person assumes importance in case of a complex sale
The modern buyer is exposed to even more choice and information, and a technology landscape that is fast changing. A customer may have identified a problem, may not understand it fully. They may not appreciate the scale or complexity of the problem, and further have little expertise in proposing a solution.
The role of the sales person then becomes to help the customer navigate through complex choices and make the right decision. For this, the sales person needs to have expertise in understanding the entire arc of the product usage from evaluation to maintenance:
- Domain expertise in understanding the complex problems of the customer.
- The abilities and limitations of the product being proposed.
- The strengths and weakness of alternative solutions.
- The viability and fitment of the product for the problem.
- The ability of the customer to implement the product.
- The model of identifying value / return of investment for the customer.
This is a very knowledge intensive job and becoming a good sales person requires skill, communication and experience. The sales person must also have the ability to simplify the entire model for the customer, by identifying the red flags or solution boundaries. The means that the primary role of the sales person is that of a consultant.
How Should A Sales Person Spend Time?
To this complex scenarios, apart from spending time communicating with the customer, the sales person should constantly try and increase their knowledge and build a reputation. So here would be the list of activities a sales person might do.
- Actively communicate to prospects and understand their problems.
- Make notes and proposals.
- Design, offer and present solutions.
- Help the customer decide and push the process to a resolution.
- Monitor projects under delivery or delivered.
- Learn about an industry and how it works and under-stand the customer’s persona better.
- Analyze each call and identify areas to work on.
- Create a bank of standard questions / knowledge base so it can save the time of the customer.
- Understand the weaknesses of the product and give structured feedback.
- Identify gaps and fill gaps in product documentation.
- Analyze the customer journey and help create marketing assets so they customer is better prepared.
- Strategize product positioning for a market.
- Identify and automate repetitive tasks, such as creating proposals, following up etc.
- Build a reputation on social media by creating and sharing insightful stories.
- Create systems for structured feedback loops.
In complex sales, the sales person is also the eye and the ear of the company and the representative of the customer. This gives the sales person the responsibility of passing on feedback and the ability to influence product roadmap decisions.
How Should Sales People Be Evaluated
Traditionally, sales people have been evaluated on basis of the business they bring in and their compensation is heavily based on targets. This incentivises certain of the above activities, like closing more sales, but is not the holistic approach that can bring agility to a 21st century organization.
In the 21st century organization, the sales person should be evaluated for all the possible value they bring in, not just the money. A balanced evaluation scheme should consider:
- Proposals effectively concluded (lost or won).
- Successful product deployments.
- Structured product feedback.
- Structured market intelligence shared.
- Contribution to market segmentation, pricing, positioning, strategy.
- Contribution to content via articles, case studies, blog and social media posts.
- Referrals from existing customers / contacts.
- Creation and maintenance of knowledge base.
- Creation and maintenance of systems.
Part of every sales persons growth should be the ability to convert the knowledge and relations into tangible assets, like articles or systems. This probably comes with a lot of practice and experience.
With the growing complexity of systems and solutions, sales in the 21st century is an even more complex job. The sales person is someone who is a generalist. Apart from communication, the most important skill of the sales person must be the ability to comprehend and express complex thoughts via writing.
Unlike the traditional image of the snake-oil salesman, the modern sales person’s job is as intense, complex and cross functional as an engineer!