Buzzwords like “big data” and phrases like “strategic data-driven decision making” have been bouncing around board rooms for quite some time. Experts report that up to 97% of organizations are investing in big data and AI, with each striving to harness data to be smarter about the people they target, the products they offer, the pricing they set, and the distribution paths they select.
Organizations across industries are clamoring for tools and techniques capable of aggregating important data as they mine for meaningful insights. No doubt the topic is hot, and there are bright spots emerging within the world of sales, yet why do so many sales organizations still struggle to fully optimize the potential of the data at their disposal?
Read on to learn more about the power behind data analytics, why sales organizations continue to struggle to unlock its true potential, and the bright spots emerging within our own client portfolio.
Show Me the Data
With the amount of data created today at an astronomical level (~2.5 quintillion bytes per day) it will come down to organizations' ability to harness it that will separate them from the competition. Data can, and is, collected from various sources to serve up valuable insights. Let’s look at a few familiar examples:
- Online retailers, like Amazon, mine data from social media, web searches, prior purchasing history and even weather forecasts to optimize inventory and expeditiously deliver online orders.
- Software firms like Workday focus acutely on talent retention by deciphering internal and external corporate data on tenure and title to identify potential flight risks.
- Even in sports, as portrayed in the 2011 film Moneyball, the Oakland Athletics prove the impact of a sophisticated sabermetric approach to scouting, which relies on collecting and summarizing relevant in-game activity. This allowed the organization to stack a team of undervalued talent capable of competing at the highest level.
Within the world of sales analytics, it’s perhaps not surprising that Asset Management firms are leading the pack. As hedge funds successfully pioneered analytics-driven quantitative investing practices the results begged the question, why not apply this same analytical rigor within other areas of our value chain? The impact was eye opening. In a recent study by McKinsey, these same firms reported that, “revenue increased 5-30% as they began using data to behaviorally segment prospects, retain clients, and assess seller productivity.
Data clearly holds the potential to greatly impact various aspects of an organization, but one question remains: What is keeping many (other) sales organizations on the sidelines? Here is our hypothesis.
A Hot Topic or a Hot Seat for Sellers?
Professional baseball players aren’t expected to keep and analyze their own statistics while playing ball, yet we expect sellers to both sell and input immense amounts of data about various client interactions and pipeline expectations. It heightens visibility but, for many organizations, its use is limited to a (micro-)managerial coaching tool and forecasting mechanism designed to keep a firm pulse on seller activity and future revenue expectations. While both of those things are 100% necessary, many sellers would argue that the direct value they receive from CRM-based data entry efforts are limited to organizing contacts and prompting next steps on key opportunities.
Fortunately, the tides are changing and CRM Providers, as well as some Sales Organizations, are focused on changing the current narrative. Both are beginning to realize the importance of increasing the quantity and quality of CRM data so that there is enough data to actually analyze!
- CRM Providers Address Quantity: To reduce the friction and frustration associated with the level of effort required to simply get the data into the system, CRM providers like Salesforce are utilizing AI to automatically capture new activities and contacts as emails or texts come in. They are launching unique technologies, like Einstein Voice, which allow sellers to use voice commands to update account details, meeting notes/follow up, and other important attributes on accounts, contacts, opportunities and activities.
- Sales Organizations Address Quality: For so long the relationship most sellers have had with their CRM has been a take, take, take. Many of our clients recognize that it is a give AND take relationship. They set clear expectations for what is required of sellers, why, and how it directly benefits each seller individually; never losing sight of how important complete and accurate data is to other segments of the business. Most importantly, they continuously strive for ways to enrich the experience sellers have with their clients to provide a win-win scenario for both buyer and seller.
Here are two examples of clients that have cracked the quantity + quality code and are serving up statistically relevant insights designed to drive action and incremental value.
Client Creates Competitive Positioning in Response to Relevant Threats
Have you ever set up a google alert to stay up to speed with an important client, competitor, or even an influential contact in your network? What if, instead of searching the entire internet, you could set alerts or search meeting notes for keywords in order to trend competitor activity? One client is leveraging a new feature within Salesforce.com to do just that.
By scanning notes logged to an account, within a territory, or across the entire organization, sales professionals can see which competitors and products are coming up most often in client conversations. Trends are assessed across various timeframes and are designed to prompt sellers to refresh and refine critical value propositions in order to safeguard their firm's position against relevant real-time threats.
Benefit: Sellers are more informed and able to strategically refine their focus to identify points of parity and contention given the product(s) in play. They are finding and presenting alternatives where additional differentiation is required, and they are proactively planning responses to potential objections in order to stay one step ahead of would-be competitors.
Client Increases Share of Wallet with Cross-Selling Predictive Analytics
If you have a smart TV that supports subscription-based streaming services like Amazon Prime Video or Hulu, then you’ve experienced their highly personalized recommendation engine that serves up shows and movies of potential interest. Netflix saves ~$1B annually on customer retention by analyzing your viewing history, combined with the history of other members with similar preferences by genre, title, actors, duration, and even time of day.
We have a client who is taking a similar approach. By analyzing the buying history of each client, relative to similar clients, the firm can deduce future purchasing behaviors to determine which products look more, or less, advantageous.
Benefit: By determining purchase frequency and corresponding confidence rules based on other clients “like them”, the recommendation engine helps sellers determine a client’s propensity to buy one product over another. Sellers are now bringing more meaningful insights to clients and confidently positioning relevant products all while increasing client satisfaction and retention.
A few parting words for sales organizations...
A Message for Sellers: To analyze data it must be available and accurate. Your organization needs your help to create the very insights that will inevitably make your life easier and provide immense value as you strive to exceed quota. If you don’t know why something is being requested, ask! If the CRM is not providing value back to you, speak up – your input it what drives meaningful enhancements.
A Messages for Sales Leaders: In lieu of an ultimate algorithmic answer, you are the glue that holds it all together. Work to understand and aggregate the experiences your sellers are hopefully memorializing in the CRM. Are certain products trending? Is one competitor gaining momentum within a market? What topics seem to be resonating? Identify and scale best practices that allow individuals on your team to be more effective.
“Data to this century is what oil was to the last one: A driver of growth and change.” -- The Economist