Many of your outside salespeople have spent the last couple of months adjusting to the COVID-19 in-person selling shutdown. Their ability to see customers as we go into a staged back-to-work cycle will still have challenges. In-person meetings and contact will be limited and, in many cases, still not possible. Many customer buyers are still working from home. Those customers in the office will be limiting the number of in-person interactions and multi-person gatherings they attend.
The below MDM chart shows how the traditional B2B distribution sales process is changed. See Part 1 of this post for details on how the traditional model is broken and will be forever changed. So, now what do you do?
Coronavirus Impact on B2B Distribution Selling
The New Model
Distribution sales have been moving from a face-to-face relationship-building approach to a ‘customer decides’ approach for some time, but COVID-19’s impact had made this slow change become reality. We aren’t going back to the good ol’ days. Here are four ways to pivot.
1) Distributor lunch and learns are over, it’s time to cancel or curtail most of them.
Your manufacturer partners have for years been seeing the declining returns of providing free lunches and training to your team. The last few months they have discovered they really can do without them — and, in many cases, do without your annual Customer Trade Show as well. On top of that, they must follow safety and social distancing guidelines to keep everyone safe. With travel and expense budgets being eliminated, these activities aren’t coming back anytime soon. COVID-19 changes have made the value of these activities decline; it’s time to invest those resources elsewhere.
2) Keep your salespeople selling using your COVID-19 tactics.
Your sales team has had to learn how to be digital sellers. They are longing for a time when they will be able to go back and see their customers face-to-face and do business the old way. The challenge is, not every customer or region is ready or even willing to go back to belly-to-belly relationship selling.
Your team needs to consider primarily doing the facetime, text, email and phone call sales approach they have been using for the past few months. If you are not intentional about this, you could have your sales team go back to making 10-15 in-person calls every week. They likely will call on the same three to four customers willing to let them sell the old way, multiple times a week, to reach that call volume. That isn’t a winning strategy.
Make sure the automation sales skills they have developed during this time of distancing don’t go to waste after COVID-19.
3) Launch a sales promotion to deliver to customers.
We have seen a lot of distributors and manufacturers communicate heavily on what they are doing to support COVID-19 recovery efforts. It might be time to augment that we-care messaging with an appropriate and compelling offer-driven promotion that entices customers to interact with you.
It gives your sales team something to sell and a way to use their new digital selling skills to promote.
4) Don’t just talk about using data — really use analytics to take share.
For decades, many distributors have been working on gap analysis by category (share versus potential) to grow their existing customer business. The size of the pie (available business) is shrinking. As a result, you must increase the pie slices you get from each customer. The key to doing this profitably is to have real data that show the actual customer potential. Then, more importantly, put a sales plan together to take that share.
This is something many distributors do well on the accounts they have assigned to their outside team.
Here is a fictional example: ABC Electrical has 5,000 active accounts that buy from you annually. Your 10 account managers can probably cover the top 500 effectively with better data and an organized sales approach. The challenge is most of your top competitors are targeting those same 500 companies. And, we are in a slowdown that puts more margin pressure on the top accounts.
You can grow those other 4,500 accounts by understanding their potential (using data) and targeting them with a combination of marketing programs, inside sales team support and a great digital platform. It requires some enhancements for many traditional distributors, but it is probably past time to do something about it.
Over the past two years, I have asked distribution leaders this simple question: “If you had the choice between adding five outside account managers or five inside account managers and a better website, which would you choose?”
Pre-COVID-19, I heard 95% of the time, “Hire the five outside salespeople.” The past few weeks I’ve been asking that same question and most leaders are telling me they would first hire more inside sales support and invest in a better digital platform.
The sales process change is here to stay. There is no DeLorean waiting to take us “Back to the Future.”
We appreciate your feedback to help us serve you better; please share your comments below or contact me at [email protected].
John Gunderson is vice president of analytics & e-business for Modern Distribution Management. Prior to joining MDM in 2018, he held senior management roles for 20 years, leading sales, category management, marketing, pricing, analytics and e-business with leading North American electrical, industrial, construction and electronics distributors.