Customers continue to leverage digital and e-commerce tools to improve their buying processes. But for many distributors, their outside sales model isn’t working as effectively as in the past to keep up with how customers want to buy. That growing gap is why a dedicated part of our research and coverage has been on the strategies, best practices and tactics for how to transform the sales process to reduce selling costs and increase efficiency and customer engagement. And it’s why the prize when it comes to increasing sales performance is on specific ways to become a more buyer-centric seller.
Sales expense for distributors historically has been the largest cost center while simultaneously one of the least managed and opaque parts of the business. A protective aura has fostered sales models that are often more account-rep driven with self-interested revenue goals than management-directed and business-strategy centered. That’s not a rap on reps. They will continue to provide critical value, but the roles have to change to a customer-driven mindset. That’s a sea change for most companies.
MDM hosts an annual conference to bring together the latest thinking on the many angles of improving sales process in distribution companies At our 4th Annual Sales GPS Summit May 11-13 in Chicago, we’re focusing on deconstructing what a buyer-centric distribution selling organization looks like, and the key levers that can help achieve that transformation.
Integration, Enablement & Compensation
While sales transformation is the goal, this is about prioritizing specific steps and projects along a journey of incremental transition. It inevitably brings levels of disruption that need to be carefully managed. There are three important levers distributors have to address this complex challenge of a sales process transition:
1. Integration. There is no tougher or more important challenge for many distributors today than transitioning a traditional outside sales model into a nimbler selling organization where digital plays a key support role. Increasingly, high-performance organizations have built a well-integrated sales and marketing system – from lead nurturing through close to ongoing service and customer lifecycle management – that combines strong technology tools with strong customer engagement capabilities. That includes deepening personal relationships effectively, with strong technology support.
While an important component of an integrated selling model is an omnichannel approach with a strong e-commerce platform, it extends across the entire organization to include CRM, managing sales leads more efficiently and ensuring that sales reps are incentivized to support an omnichannel organization.
2. Sales Enablement. A quickly emerging concept in distribution, sales enablement offers a more wholistic and strategic approach to boost sales performance. It encompasses a systems-based approach that includes technology, analytics, talent development and building a continuous improvement process. Many of our sessions at this year’s Sales GPS touch on these aspects, as well as a dedicated session on the sales enablement building blocks.
3. Compensation. Compensation often becomes a sticking point when implementing initiatives. Most organizations have sales compensation systems that are misaligned strategically and structurally. For example, many sales reps feel threatened by e-commerce capabilities and actively fight its adoption. Structurally, best practice in this new environment increasingly focuses on the importance of differentiating gross profit dollars, and migrating to more flexible goal-based comp plans.
There are a number of factors challenging distributors to transition the sales process to a more integrated and efficient model, and to start that incremental journey now: Impending retirements, the rise of Amazon Business, new digital platforms and fast-changing customer expectations of the buying experience and value expectations.
It’s a rapidly evolving competitive advantage to deploy more resilient and flexible omnichannel selling methods with characteristics unique to distribution.
2020 Sales GPS Summit
We have a great line-up of speakers and panelists this year: Mike Marks, Mark Dancer, Colleen Stanley, Henry Bruckstein, Mike Kunkle, Mark Roberts, Mike Emerson, and panels of both smaller and larger distributors sharing their experiences in the sales transformation process. For more information on the conference, visit salesgps.mdm.com.