Sales 2.0: Getting Social About Selling
As customers become more comfortable with social media, the meaning of "Web 2.0" is beginning to shift away from simply a technology set and toward a new type of online experience in general, writes Aberdeen's Alex Jefferies. Simultaneously, individuals who are highly accustomed to interacting with social media are entering the workforce. This can present an opportunity.
As the proliferation of online social media forums has forever changed the way customers gain information and feedback concerning a particular company's products or services, sales representatives are challenged to sell to a prospect base that potentially knows as much, if not more, about the competitive landscape than the reps themselves.
This new sales challenge has caused a number of companies to implement social media solutions within the enterprise as a way to more effectively connect sales representatives to the subject matter experts they seek. In August and September 2008, Aberdeen surveyed over 210 companies to better understand how the use of social media solutions within the sales department contribute to a reduction in the amount of time sales reps spend searching for relevant information.
In the traditional sense, the phrase "Web 2.0" has been used to describe a new set of technology solutions such as wikis and blogs which simultaneously provide online customers with opportunities for collaboration and individuality. However, as customers become increasingly comfortable with social media, the connotation of the phrase "Web 2.0" is beginning to shift away from simply a technology set and more toward a new type of online experience in general. The simple fact is that customers have come to expect a certain level of accessibility to information and peer reviews concerning a particular company's product or services. As a result, the competitive landscape has been leveled by consumers' understanding of various companies' value propositions to the market.
This shift on the part of consumers has created an added challenge to those sales representatives hoping to identify and close new deals. Customers are using the feedback concerning a company's products, services, and reputation to inform purchasing decisions. Therefore, it has become crucial for sales representatives to arm themselves with as much relevant information possible without spending excessive amounts of time seeking it out. This need has caused top performing companies to turn to enterprise social media solutions as a way to connect sales representatives to subject matter experts within the company and ultimately reduce the amount of time sales representatives spend preparing themselves to meet the needs of a new prospect base.
As you can see in Fig. 1, the pressures to increase top-line revenue growth (63 percent) and improve overall sales productivity (60 percent) were identified by survey respondents as the top two pressures causing organizations to focus resources on the organizational capabilities and technology enablers used to improve sales performance . Nearly a third of respondents (32 percent) also cited the need to compete with increasing customer and prospect knowledge of products and competitive differentiators as a factor determining spend on sales performance.
In order to alleviate the pressures of increasing top-line revenue growth and improving sales productivity, companies are implementing various strategic actions to ensure that sales representatives have quick and easy access to the information they need to sell more effectively. Forty-eight percent of survey respondents indicated that improving sales representatives' knowledge of products, customer needs, and competitive offerings is a top-two strategic action to alleviate top business pressures. Reducing the amount of time sales representatives spend on administrative tasks, such as data input and documentation, was identified by 34 percent of respondents as a top-two strategic action as well. The easier it is for representatives to identify and access crucial information, the greater likelihood there is that they can make more meaningful contact with prospects on an ongoing basis.
Customer relationship management (CRM) solutions have become a relative staple for businesses of all sizes. The fact that they provide enterprise-wide visibility into key sales and marketing functions, as well as afford the opportunity for customization and data integration, has led to high adoption amongst all three maturity classes, with Best-in-Class organizations leading the way. Social media collaboration tools, on the other hand, are relatively new to the enterprise. Of those Best-in-Class companies that use social media solutions solely within the enterprise or on an external and internal basis, internal blogs (71 percent) and internal wikis (64 percent) ranked as the two most popular social media solutions. Wikis, for example, have several applications in the realm of sales, particularly around document and project collaboration (Fig. 2).
As sales managers search for effective ways to manage their teams outside the traditional avenues of meetings and e-mails, wikis allow for project and team collaboration around a certain account or opportunity. Furthermore, wikis allow several high-ranking sales officials to collaborate and document the preferred sales processes for the organization, a capability that Best-in-Class companies outperform Laggards in, 66 percent versus 48 percent. Forty-six percent of respondents also use wikis for training purposes. As companies strive to get hires to achieve quota as quickly as possible, a forum for best practices and frequently asked questions becomes another valuable resource. Seventy-nine percent of Best-in-Class companies currently have a defined process for onboarding new sales hires, a process that is made more effective by access to a collaborative "best practices" wiki.
In order for an organization to effectively incorporate enterprise social media solutions into the daily workflow, a few key steps must be taken:
- Instill an organizational focus on knowledge management and information transfer. As the baby-boomer generation continues its move toward retirement, businesses are experiencing a ripple effect from this change in the workforce. First, companies must ensure that they effectively manage the transfer of knowledge and information that resides in the minds of a generation that has spent several decades in the workforce. Consequently, businesses must acknowledge that a new generation of young professionals is entering the business world. This generation has a deep familiarity of social media tools in their personal lives and incorporates these technologies into their networking and research activities. Forty-three percent of survey respondents indicated that their company is ineffective when it comes to using social media technologies as a way to make the office environment more desirable to younger professionals entering the workforce.
- Dedicate the appropriate resources and management support to social media. Once an organization has taken a pragmatic approach to how social media can benefit its sales organization, it is necessary to solicit the appropriate support and resources from senior management. As companies typically undertake three or four large business objectives during the course of a fiscal year, it is crucial to have a champion amongst the senior management ranks who can explain the benefits to the organization at large. If the employees in an organization don't get the sense that a social media objective is a priority to senior management, it is likely to hinder adoption rates. Currently, only 29 percent of Laggards, compared to 55 percent of Best-in-Class companies, have the support of senior management for internal-facing social media solutions. Furthermore, only 18 percent of Laggards, compared to 28 percent of Best-in-Class companies, currently have dedicated resources devoted to the enterprise-wide use of social media. An additional 58 percent of Laggards indicated that they have no plans to allocate such resources to social media.
- Proactively spark employee adoption of social media tools. Sixty-four percent of the Industry Average indicated that their employees spend "very little time, if at all" using enterprise-wide social media applications on any given day. Considering that 41 percent of Best-in-Class companies indicated that employees spend "a few hours a day" and 29 percent of Best-in-Class companies responded that the social media platform is a deeply ingrained and integral part of their employees daily routines, Industry Average organizations must focus heavily on employee adoption. The 71 percent of Industry Average companies that have no plans to implement an incentive or compensation plan for online contributors whose ideas or suggestions are acted upon may do well to jumpstart adoption through such programs.
- Define metrics for measuring the impact social media has on sales productivity. Once an organization has established the proper organizational processes and implemented a social media initiative within sales, the next step is to measure the effects such an initiative has on sales productivity. Currently, only 14 percent of Best-in-Class companies have such metrics in place; however, an additional 41 percent of Best-in-Class companies plan to identify and implement such metrics in the future. This eventual adoption rate of 55 percent outpaces the eventual adoption rate of 44 percent on the part of Laggards. Best-in-Class companies must identify those sales metrics that they hope to affect through the use of social media, whether they be sales cycle time, lead conversion rate, or quota achievement, and take the necessary steps to measure their performance.
According to research conducted for the Aberdeen report "Customer 2.0: The Business Implications of Social Media", 60 percent of all survey respondents consider the business use of social media a priority going into 2009. The result of an increased number of companies welcoming, and in some cases facilitating, online conversations about their product or services is ultimately a more knowledgeable and informed customer.
In order to properly understand the business challenges of such a customer base and more efficiently map their own products and services to these challenges, sales representatives must have access to the tools that allow for quick and easy internal collaboration. By connecting sales representatives to subject matter experts, allowing them to collaborate on project or procedural documents, or simply reduce the amount of time spent looking for answers to frequently asked questions, organizations can shorten sales cycles and improve overall sales productivity. The use of social media solutions within the enterprise better prepares sales representatives to answer questions from prospects who understand the competitive landscape, thereby allowing them to work smarter, not harder.
To download a free copy of the "Sales 2.0: Social Media for Knowledge Management and Sales Collaboration" benchmark report, click here.
Alex Jefferies is a senior research associate for Aberdeen Group's customer management technologies group.