Why You Should Not Let Sales Work the Booth at Tradeshows!

Unless they are in sync with your event goals.

 It is kind of hypocritcal that I write this post given my actions as both a direct sales contributor and sales leader working tradeshow exhibits.  I say these things in repent knowing that I was wrong in my actions and ask for forgiveness from my previous co-workers. 

I used to manage a large sales team for a $120 million company in Seattle; we sold a large enterprise application with an average sales price of $125,000.  I had a total of 25 sales reps reporting to me from three regions and was one of four Regional Vice Presidents managing a team.  The culture within our company was very competitive across these regions on a quarterly basis with each of us vying to out-perform the other regions from both a revenue generation and forecasting basis.   Jim and I managed regions that were the primary contributors and we both respected and hated each other.  Essentially my team and I had two competitors we were dealing with on a day to day basis, our cohorts within the company and those external competitors we were competing with for new business. 

Now imagine deploying this culture at a tradeshow where there are no geographical boundaries with regards to ownership of leads and opportunities.  I had three primary goals with regards to my company’s exhibit:

1 )  A percentage of my pipeline was walking the floor; I did not want Jim or his team anywhere near these opportunities.

2)  I also did not want a new temp Marketing just hired or Marketing in general pitching these opportunities. 

3)  I wanted to make sure we got more leads than Jim. 

I can’t believe how shallow I was.  Jim was the same way though.  Bastard. 

By the way, Marketings goals were not in alignment with mine. 

Anyway, when I or my team was working the exhibit we naturally worked it with these three goals in mind.  If an opportunity from New York visited (not my region) we would pass these individuals to someone in Marketing or simply hand them a brochure and covertly send them along their merry way.  We would also inadvertently forget to scan these leads.  Actually I usually did not scan at all.  For my leads, I would grab their business card and slip them into my pocket.  Marketing was scanning everybody they could anyway to win a “Who can drive the most leads” contest.  This contest usually got a little out of hand.  I was often scanned by our own company to increase their counts.         

I was watching the NE region (Jim’s) closely and could care less about the scans Marketing was capturing.  We knew if an opportunity appeared because Marketing was instructed to get one of us in these cases.  Event success was determined based upon the number of business cards we captured versus Jim. 

Man, if our CFO knew this was happening I am quite certain he would have been pissed. 

For you marketing leaders out there, remember you have no boundaries so please make sure your team treats their leads with the company in mind, not themselves.  If you are inviting sales to participate, let them know you are working for everyone on the team and jointly create an event strategy.  Focus on driving leads that are categorized to Sales specifications (Validar eatings its own dogfood).  Get your CEO involved with the planning as a means to set the ground rules.  Don’t bring them in if this investment is coming out of your budget and they are not aligned.  Jim is a prime example of what will happen!  Let me know if you have any stories to share as well.  I know they are out there.

It’s budget time! Was your marketing budget cut?

 As a former sales leader and direct sales contributor, I have been on the receiving end of leads for many years.  Throughout I have seen firsthand the challenge marketing teams have in articulating their value to a CFO.  By value, I mean revenue production.  If your marketing budget was $4 million, what revenue impact did your company receive through this investment?  These are the types of questions that typically come up:  

1)      How many deals did we land through the 40 tradeshows we attended?

2)      How much revenue was driven from our user’s conference? 

3)      How many leads came in and were closed via our website?

4)      What is the revenue figure associated with these marketing assets?  

I can go on and on with these types of questions in which accurate answers can be very difficult to obtain.  This usually leads to a reduction in budget, which forces the marketing department to do twice the work with half the resources.  Sound familiar?

True story:  Larry, Vice President of Marketing, and Victor, Vice President of Sales are in an annual review in preparation for budgets with the CEO and CFO.  Larry, in his annual review presentation proudly stated that lead volume across all touch points (Website, tradeshow, and direct marketing) was up approximately 20%.  He stated that his literature distribution volume was up as well.  He was kicking butt and wanted the boss to know.  Victor piped in and stated that Larry should stop sending him leads.  He didn’t have the bandwidth to work that activity and most weren’t even followed up on.   Argument proceeded and the meeting was over.  Afterword, they put us both in the same office and ended up cutting Larry’s marketing budget by 20%.

 What did we do?  We ended up collaborating on the definition of a “Sales Ready” lead.  We also agreed upon two additional metrics, average sales price and average close rate across three product types.  Marketing agreed to only hand over leads that were categorized “Sales Ready” and Sales agreed to meet or exceed the agreed upon average sales price and close rate metrics. We also adjusted our compensation plan to encourage Sales to update the status of their opportunities within our CRM system.  Essentially, if their territory activity/pipeline was not depicted in CRM and closed orders updated, they did not receive commission. 

Through these efforts, Marketing was able to more accurately depict their projected, pipeline and actual revenue production from a campaign to campaign perspective.  Sales was getting what they wanted as well, qualified leads.

calculator

Based upon this experience and many others, I cannot stress enough how important it is that both sales and marketing are in sync with regards to their efforts.  The benefits of effective collaboration are tremendous; increased revenue, reduced lead management costs, improved CPOD (cost per order dollar) improved deployment of CRM and ancillary marketing tools and corporate sanity! 

In our next annual budget meeting, our conversation revolved around adjustments in our “Sale Ready” definition, strategies to improve close rates and adjustments in campaign investments based upon the aforementioned results.  We found some campaigns were driving in 50% fewer leads but 15% more “Sales Ready” leads.   The cost benefit of adjusting was tremendous! 

Let us know if you have any other stories regarding budget challenges and wins.

Ever wonder how much you spend managing leads collected from Trade Shows?

A case study of Validar eating its own dog food at Dreamforce 09.

Validar just returned from exhibiting at Dreamforce, Salesforce.com’s annual Users Conference in which we generated 148 leads in three days.  This event is the biggest gathering in the world of Salesforce.com users which is a target market for us.  Salesforce.com users can leverage Validar Lead Import with our Lead Capture product suite to get the complete marketing picture which includes the elusive ROI calculation.   Overall it was an absolutely great show with excellent content and smart people attending.  The downside for us, it was very expensive to be there!  We need to close some business to justify the expense which means we need to be smart with regards to how we manage our leads.

As expected, we qualified leads at capture, which was essentially asking some questions and associating the responses to those leads.    Depending on how the questions were answered, we associated respondents in to three simple categories:

1)      “Sales Ready” – I have a need and request sales follow-up post event.

2)      “Incubation” – Our Company can benefit but it’s not the right time to talk OR  I am not the right person.  Put me on your mailing list or send me an email and I will refer to the correct person.

3)      “Trinket Seeker” – We were giving away a Kindle.  These folks wanted to win the Kindle and desired no follow-up.  This is a great way for attendees to control how they will be treated post event.

1)       Here is a graphical view of our data:

Dreamforce chart

Validar has a direct sales model, made up of both inside and outside sales teams.   Inside sales is responsible for incubation and nurturing of existing leads that are not quite ready to purchase.   Outside sales is responsible for following up on “Sales Ready’ leads.  The day after Dreamforce all Sales Ready leads were in outside sales hands, the Incubation leads were handed over to Inside Sales and the Trinket seekers will be treated as requested, no follow up.

Validar’s focus will be on the 45 “Sales Ready” leads.  We need to convert 15% of these in order to meet our revenue goals.  All indicators are positive with the campaign already showing a pipeline that exceeds our revenue goal.

Now, compare this to the large percentage of exhibitors at Dreamforce who were simply scanning as many leads as they could.  An exhibitor we spoke to had a lead scan quota (roughly 24X larger than our actual scanned leads) that they were trying to meet.  In these cases, every lead they captured is uncategorized and will need to be treated as “Sales Ready”.  This creates a tremendous waste of valuable time and money chasing bad data.  Also, most of the folks that were scanned will unwillingly be receiving calls and emails inquiring about products and services that they are not interested in.  Sales typically will try 6 to 8 times to determine a leads validity. That is a lot of effort chasing bad data even if you use a valuable incubation engine.   I have been in this scenario and hate it!  Sales, Attendees, and Marketing all get frustrated.   One last thing–it will take conservatively a month for these companies to identify the true Sales Ready Leads even with an incubation engine, which by this time have already reduced in number by simple lead decay.  How many of your Sales Ready leads are still Sales Ready four weeks after the event?   With a conservative 10% lead decay rate  reduction I would find 40 opportunities versus the 45 we had immediately after the event.

Assuming Validar would have captured leads in this manner at Dreamforce, (Forcing Sales to treat all 148 leads as if they were Sales Ready) how much money would have we wasted chasing bad data and lost through standard lead decay?  Validar has built a model that identifies this figure.

This model takes into account the following metrics in its calculations:

  • Fully Burdened wages of our inside and direct sales reps.
  • Step by step process and time associated with manually processing and distributing all leads to sales versus Validar’s automation.
  • Step by step process of nurturing all 148 leads.
  • Average sales price.
  • Average close rates for “Sales Ready” and “Incubation” leads.

With these metrics in mind, Validar saved $4,710 by identifying “Sales Ready” at capture and automating the process of posting this activity to Sales and the associating Campaign within Salesforce.com.  We are also conservatively projecting an increase in expected units sold for this show from 6.5 to 8.17 based upon reduced lead decay in lead follow up.  This represents $67,000 in increased opportunity and sales provided we can close.  All indicators are in alignment already with regards to our ability to meet these projections.  Woo Hoo!

Dreamforce GAP

We’re a small company that exhibits at very few shows.  Imagine the impact qualifying leads at capture can have for a large program.  Call us if you want to model out one of your shows.  You’ll be amazed at the opportunity to reduce cost and increase revenue.