Yogi Berra Makes the Call on Your Sales Channel Revenue Growth

Ed Marsh | Oct 5, 2015


Yogi Berra, 1925 - 2015, RIP

Certainly you heard the news.  Yogi Berra died on Sept 22nd.  Truly the end of an era.

There's another era that's ending, just as certainly, although more gradually.

Traditional B2B industrial sales, ≈1900 - ≈2014

Screenshot_2015-08-12_14.23.36This isn't another article about how sales has changed.  It isn't even another article about the more salient point that buying has changed and sales hasn't yet.

This is about an odd dissonance.   Management teams recognize that buying has changed - after all it's changed how they buy personally and as a company.  And yet they persist in selling the same way.  (View this 8 minute presentation for more on the dissonance.)

A small marketing team provides branding, awareness and a bit of lead gen for a large sales team that used to generate most of their own leads but can't any longer.

And yet even among industrial manufacturers that have:

  • embraced content marketing (a small number)
  • really do it well (a very small number)
  • effectively aligned sales and marketing (a tiny number)

most still persist with a traditional approach to indirect sales channel whose very raison d'etre is now in question.

Yogi nailed it - companies are making good time, working hard, measuring quotes and cold calls, hiring and training sales reps.  They're doing all the things they learned in 1995 were important.  But they're lost.  And their revenue growth strategy is often incoherent.

Industrial sales channel

Most industrial companies sell through distribution, reps or some other form of indirect sales channel.  This model was sensible as it developed.

  • companies would have out sized sales forces, local market knowledge and more "feet on the street" than they would otherwise be able to afford
  • regional warehousing was available
  • local support and service were an integral part of the model

and most importantly, in an era when marketing was a very expensive and cumbersome process of brand building, indirect sales channels were a lead generation and project creation alternative.  Manufacturers often supported the efforts with development funds & allowances, but relied on the channel to "spread the word."

Of course buyers similarly relied on channel.  Aside from the shelf full of green Thomas Registers, local distributor reps were the source of ideas, expertise and market information.  So when a company needed to solve a problem, channel reps who had cultivated strong relationships and were viewed as resources were called in for a consult.

Later two more reps (who hadn't built a relationships) were called in for competitive quotes.  So whether it was creating a project or simply responding to an RFP, indirect sales channel was the method upon which manufacturers relied to find buyers.  And manufacturers fought to find and engage the best connected channel partners as a key element of their revenue growth strategy.

Beyond sales & marketing alignment

You know what's coming next....the internet changed that, right?  After all, not only do buyers often not rely on channel sales to help find the right solution, turning to the web to research options.  But they use internet search far earlier now - to help define, scope and understand the challenge long before working to identify the solutions.

Sure, I know there are exceptions.  Some sale channel are insightful and valued by customers - often at the rep level and occasionally at the company level.  But we both know they are rare.  Indirect sales channel still fills an important role in providing local support, although improved reliability and remote diagnostics have changed that too in some cases.

In general, however, the lead generation and project creation role of indirect sales channel is substantially diminished.  Now manufacturers create the leads using digital marketing.

That's got big implications for industrial manufacturing companies - indeed it means your sales & marketing alignment challenge is bigger than the one between your two silos....it's a fundamental fracture in your revenue growth strategies.  Your channel model is poorly suited to today's buying behaviors.

Over the next couple weeks I'll cover more about working effectively with industrial distribution and indirect sales channels to drive revenue growth.  In the meantime here's a quick list of tips:

  1. Internalize all lead generation goals
  2. Get really good at nurturing - content marketing leads are rarely channel ready
  3. Build an inside sales team - your field sales group doesn't have the time and probably lacks the skills required to sell leads until they are channel ready
  4. Leverage your channel contacts - create white label and/or cobranded campaigns which you can manage for them (they'll often lack the staff, tools, expertise and even interest in undertaking them on their own)
  5. Engage channel in social selling
  6. Construct channel enablement programs in ways that drive effective sales approaches (templates, trackable electronic document links, etc.)
  7. Integrate channel lead tracking & management into other CRM/marketing automation solutions (PRM or partner relationship management becomes another technical building block)
  8. As you create projects with ideal end user prospects, ask them for local channel recommendations - work backwards to find the right partners that buyers value
  9. Build marketing automation workflows that incorporate your channel partner - provide value to them and the prospects and create best practices
  10. Evaluate your channel for your exposure to boomer business transitions - loyalty to long-time partners is important, but at least some of your channel is milking lifestyle businesses for a couple more years.  You can't grow together that way.  Be realistic
  11. Substitute product training with sessions on how to sell inbound leads - seriously?  no product training?  No, of course not, but we both know you'll do that anyway.  You have to help channel understand personas, journey, team buying and how to sell the very different type of leads you create with content marketing

But all of it depends on the effectiveness of your own digital marketing which should be core to every manufacturing company's revenue growth strategies.  Learn how what's involved from our free eBook Manufacturing Revenue Growth.

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