Featured on this episode:
Resources:
- Tim on LinkedIn
- CorporateVisions.com
- Book: The Expansion Sale: Four Must-Win Conversations to Keep and Grow Your Customers
- B2BDecisionLabs.com
Transcript
Will Barron:
This episode of the show is brought to you from the salesman.org HubSpot Studio. Coming up on today’s episode of the sales leadership show.
Tim Riesterer:
I mean new logos are never not going to be part of the portfolio but I think pretty much everyone could agree that it sort of maxes out at 20% of your number in any given year. The product’s not the hero anymore. It’s the services you wrap around it, the personnel that you bring to bear. So whether you’re doing building automation, HVAC and that kind of service, that’s now a managed service. Well the first thing we have to recognise it just isn’t all contained in sales. Every one of these I’ll just, an overused term is to call it a play.
Will Barron:
Hello salesnation. My name is Will Barron and I’m the host of the Sales Leadership Show. And on today’s episode we have the return of Tim Riesterer. He is the Chief Strategy Officer over at Corporate Visions. He is the author of the book, The Expansion Sale. And that’s exactly what we’re getting into on today’s episode of the show, how to from a perspective of being data-backed of all Tim’s comments and thoughts in this episode, how to expand your current customers from a leadership level and drive tonnes, tonnes, more revenue post-pandemic. Everything that we talk about is available in the show notes for this episode over at salesleadership.org. And with that said, let’s jump right into it. Tim, welcome to the Sales Leadership Show.
Tim Riesterer:
Hey Will. Good to be here with you.
Should Sales Leaders Focus on Bringing in New Business or Would it Be More Pragmatic to Focus on Expanding The Accounts They Already Have Post-Pandemic? · [01:32]
Will Barron:
It’s good to have you onset. So on this episode we’re going to cover the post-pandemic expansion sale. We’re going to be referencing the book I’m sure the whole way through the expansion sale. And I’m going to ask you it is probably bad interviewing right, is probably bad sales conversations to ask you a massively leading and loaded conversation to get us going but I’ll frame things up. So sales leaders, sales managers, listening to this right now Tim, should we be focusing on new business, new logos or would it be a wise thing right now post-pandemic to be focusing on how we can expand within the accounts that we already have?
“New logos are never not going to be part of the portfolio but I think pretty much everyone could agree that it sort of maxes out at 20% of your number in any given year. And 80% of your number is driven by your existing customers.” – Tim Riesterer · [02:00]
Tim Riesterer:
Yeah, I don’t want to be captain obvious or have an uncanny grasp of the obvious. I mean new logos are never not going to be part of the portfolio but I think pretty much everyone could agree that it sort of maxes out at 20% of your number in any given year. And 80% of your number is driven by your existing customers. So then the question really becomes, are you planning accordingly? Are you preparing, are you equipping and enabling correctly and appropriately for that motion? And so what I would say is yes, unlike maybe last year when the pandemic first started, where honestly new logos went to zero because everybody just hunkered down. And when you do scientifically, we talk about people’s status quo bias. You really retrench to what is your last known safe and that is what I’m already doing.
Tim Riesterer:
When the world is scary, last thing I want to do is something scary like switch vendors or partners. And so I think companies got used to the fact that if they were going to make something happen, they had to work with their existing accounts. And what they’re all starting to realise right now, especially as companies all move into this sort of recurring revenue model in one way, shape or form, is that really expansion is the new acquisition. And that’s where the time and attention needs to go.
Why Most Businesses Are Shifting to a Recurring Revenue Model · [03:42]
Will Barron:
For sure. I’ve worked double down on this point as well of software as a service SAS model that everyone’s going to recurring subscriptions. So I used to sell medical devices. A hundred percent of the time, big capital outlays. And just as I was leaving the organisation, they were moving to service models. Now I spoke to Sean in the organisation. Do you have a day? He wanted to have a catch-up so I jumped on the phone with him. He got to laugh at my expense of my mistakes and some of the stories that went round of kind of what I did then and what I do now on that side of things in the organisation.
Will Barron:
But he said they’re almost completely now selling services. So a monthly service contract for a whole operating room, a member of staff to live in the room, to maintain everything, to really look up to the recordings of the endoscopy cameras, surgeries and that side of things. And he said the whole model is that. And he said over the past five, six years has shifted from I said a hundred percent capital to this. So it isn’t just affecting I guess the stereotype of software products, Salesforce, HubSpot, these kind of cloud-based apps. It’s affecting everyone, isn’t it?
“The product’s not the hero anymore, it’s the services you wrap around it, the personnel that you bring to bear. So whether you’re doing building automation, HVAC and that kind of service, that’s now a managed service.” – Tim Riesterer · [04:15]
Tim Riesterer:
Not at all. I mean yes, in fact the product’s not the hero anymore. It’s the services you wrap around it, the personnel that you bring to bear. So whether you’re doing building automation, HVAC and that kind of service, that’s now a managed service. And any of the sort of equipment and tool cribs and other things inside of manufacturing plants are all outsourced as a managed service anymore. So you’re right. If you put an MRI machine and you didn’t buy an MRI machine anymore, you bought the service with it. In fact you probably pay by the scan for the use of the equipment and the throughput as opposed to buying the capital equipment. So suffice it to say the entire recurring revenue model where keeping and expanding your customers is the entire motion of the company is consuming every industry.
Buyers Are Letting Down Their Guard and Are More Willing to Buy the Right Products and Services From The Right People · [05:08]
Will Barron:
Is there any sign and I guess any research or data on this that’s been measured right now would come out months from this date, because that’d be processed right. But is there any sign that this hunkering down of buyers, whether it’s a current customer or wherever it is someone that we’re going after who is new. Is there any sign that some of that is lighting up?
Tim Riesterer:
There are signs that it’s lighting up. I think the big question everybody has is how do I go meet those people? How do I break through and create that level of contact and start to build that level of rapport that’s required for them to reconsider their current partner and maybe leave to choose a new partner. And I think the bigger question has become, okay, now that it’s opening up from standpoint of interest, but it’s not opening up from the standpoint of physical presence, what do we need to do different to acquire new logos? And so that’s the kinds of conversations we’re having. And I think it’s interesting because if you think of a salesperson who used to go out on the road, they only had so much time to have so many meetings. And now if they don’t go out on the road, you’ve now got potentially increased capacity.
“Salespeople now are being put on a cadence instead of on an expense account. And everybody’s going to find that that cadence is more productive and more persistent than we were when we’re out in the field. And everybody’s going to have a big old debate at some point like, do we really want to go back in the field? Do we really want to sponsor an expense account? I really kind of prefer this cadence thing.” – Tim Riesterer · [06:41]
Tim Riesterer:
When they were on the road, they had the excuse, well I made one or two calls and then when I went back to the office I only had a little bit of time to do some legwork. Now they’re in the office. And the reality I keep talking about is the productivity and the persistency has to go up because now we have the time, the bandwidth and the tools really to insist on, hey, we got to do 10 touches to get that contact. I can’t give up after 2. So what’s happening is I keep saying salespeople now are being put on a cadence instead of on an expense account. And everybody’s going to find that that cadence is more productive and more persistent than we were when we’re out in the field. And everybody’s going to have a big old debate at some point like, do we really want to go back in the field? Do we really want to sponsor an expense account? I really kind of prefer this cadence thing. So I think we’re in for sort of a real conversation about the disposition of selling talent.
Do Buyers Prefer Virtual Sales Calls or Do They Still Crave The Human Element in Face-to-Face Meetings? · [07:13]
Will Barron:
We’re going to go slightly off topic here, but what are your thoughts on it from a bias perspective? I know a lot of the work that you do is focused on what the buyer wants as opposed to what salespeople want to spam into the marketplace, based on which may or may not work. Do buyers want salespeople, sales leadership, sales teams to be communicating over Zoom? Or do they want that touch? That in-person meeting, that ability to physically hand over documents, whatever it is that we once had in the past? Are they bothered?
“Bain Consulting has come out with some data that’s like, three out of four buyers are totally happy and comfortable buying virtually, and aren’t sure that they think they need to meet with people in person.” – Tim Riesterer · [07:51]
Tim Riesterer:
Well yeah. I mean, before the pandemic everybody would have said, no, we don’t want to do this over Zoom. How impersonal is it. Now that it was forced, everybody’s like, huh, I guess we can do that. And I didn’t know that was a thing and now it is a thing. And I’m seeing data, not our own data, but like Bain has come out with, Bain Consulting has come out with some data that’s like three out of four buyers are totally happy and comfortable doing it over virtual, whatever format that you use. And aren’t sure that they think they need to meet with people in person. That’s three out of four who I’m guessing would have probably said yeah, I think we should probably meet in person.
“And Bain was also saying that the move from what are you willing to buy without ever having physically met a salesperson has moved from hundreds of thousand dollars to now at least a million-dollar threshold. So the willingness to do it as well as the dollar revenue attached to the deal is going up. So it’s here to stay clearly.” – Tim Riesterer · [08:18]
Tim Riesterer:
We all learned how to buy things at increasing dollar levels over Amazon. And Bain was also saying that the move from, what are you willing to buy without ever having physically met a salesperson has moved from hundreds of thousand dollars to now at least a million dollar threshold. So the willingness to do it as well as the dollar revenue attached to the deal is going up. So it’s here to stay clearly. And the question I think is what percentage of a deal cycle as well as entire deals is done virtually it’s not a matter of going back to anything that looked like before.
How to Re-equip Your Sales Team to Sell Virtually and at Scale Now That Most People are Working From Home · [09:08]
Will Barron:
For sure. And I guess it’s, to use the Corporate Visions language, we’ve broken a status quo. The status quo was salespeople come and visit. We sit there, they take us out for tea, coffee, golf, whatever it is. And that’s clearly that change. So with that said then Tim, how, and I’m trying to leave this as open-ended as I can. Are there any frameworks or what do we need to do to re-equip our sales team to communicate the messaging to expand the sale? How do we re-equip our team to do this at scale when everyone is sat at home or sat in an office whereas we would be on the ground otherwise?
“So if you have a sales engagement platform that tells you, this is what you do today to this person, to that person, to that person. You get 30 tasks in the morning. And one says, send an email. One says, leave a voicemail. One says, do a social touch but it doesn’t tell you what to say or how to say it and there’s no content attached to it. All of a sudden people are just making stuff up or they’re frustrated because the only value added there is I have 30 tasks but nothing to put in there.” – Tim Riesterer · [10:08]
Tim Riesterer:
Well I think there’s a couple of things we’re seeing. Is that again, because when we used to try to help salespeople with technology and enablement content, they’re out in the field, in the planes, in their cars and they would or wouldn’t get around to entering stuff in their CRM or wouldn’t get around to looking at their content. And they would just sort of shrug their shoulders and go, what do you want me to do? Meet with customers or play with your little tools. And now all we have are tools. So I think one of the things we have to realise is the opportunity is ripe. But the problem is people find out they put these tools in place, but there were no habits formed. And the tools themselves were just empty vessels and something had to be in it. So if you have a sales engagement platform that tells you, this is what you do today to this person, to that person, to that person. You get 30 tasks in the morning.
Tim Riesterer:
And one says, send an email. One says, leave a voicemail. One says, do a social touch but it doesn’t tell you what to say or how to say it and there’s no content attached to it. All of a sudden people are just making stuff up or they’re frustrated because the only value added there is I have 30 tasks but nothing to put in there. So what companies are starting to realise is these tools created a rigour and created a structure, a prescription if you will, but now they’ve got to put something in it. They need to put like a cadence should be a smart cadence. And then maybe what they should do is some AB testing so that they can have a certified cadence. This is the one that works best. And then move that into the field and say, the way we’re going to help you be more successful is yes, we’re going to put you on a cadence but we’re going to give you messaging and content and skills that match that.
Tim Riesterer:
And we’re going to go out and test that so we can tell you this with confidence that this works best. And I think that’s what companies are trying to figure out how to do to scale this. Is look at the tools, look what’s being expected of sellers and trying to pre-populate and fill that with cross-functional input and cooperation and create some sort of prescriptive message content experience that then sales can execute against. And that’s how you get this at scale because otherwise I’m now at home and I’m faced with all these tools that I was able to shrug off before. And now they’re my workflow. And we got to do better than just teaching them how to turn them on.
How Sales Leaders Can Improve Virtual Selling Processes By Populating Sales Engagement Tools With Relevant Content and Actionable Steps · [11:49]
Will Barron:
How do we know if we have the capabilities to do what you just described to build out this prescription, this is process internally? And how do we know when we need to bring in help to make some of this happen?
“I think what companies have to do is they have to think more cross-functionally and how this prescriptive play has stuff put in it from marketing, stuff that sales has to do against that and maybe supported by sales enablement. And then because most of these things, acquisition, retention and expansion all at some point touch your customer support, customer success team, they’re part of that mix as well.” – Tim Riesterer · [12:38]
Tim Riesterer:
Well the first thing we have to recognise, it just isn’t all contained in sales. Every one of these, an overused term is to call it a play. But each of these plays is really cross-functional. So when I think of like an acquisition play or a retention play, or an expansion upsell play, there’s database creation and going in the tool, there’s information and profiling of those targets going in the tool, marketing does that. And now here’s some campaigns and some scripts, and some other things that go into that. Tool marketing can help there. As opposed to sales just now here’s your engagement tool. So I think what companies have to do is they have to think more cross-functionally and how this prescriptive play has stuff put in it from marketing, stuff that sales has to do against that and maybe supported by sales enablement.
Tim Riesterer:
And then because most of these things, acquisition, retention and expansion all at some point touch your customer support, customer success team, they’re part of that mix as well. So the way we’re engaging with companies right now is looking to build these specific plays, acquisition, retention expansion. And in each case, how does marketing sales and customer success work to more or less degrees in each one? And the message, the content, the skills and the tools are all integrated into that play. And so in the culture, is the cooperation there between those departments? Are the tools in place and is the know-how in place to do that? I think people are turning at this point to accelerate this by bringing in some outside partners to at least get some of these prescriptive plays in place. So then they can begin tweaking them for different scenarios that might pop up or different markets that they’re targeting or different competitive responses. But getting the tracks laid sometimes requires a little outside help.
Whose Responsibility is it to Populate Sales Enablement Platforms? · [14:07]
Will Barron:
For sure, I totally agree. And you might make a few of the sales leaders listening right now frown slightly bought who should own this? If one person, one executive, one group of individuals should own this process, should it be marketing? Should it be sales? Should it even be some of it customer success if we’re looking at upselling with an account?
Tim Riesterer:
The creation is cross-functional. And what I found inside of companies is you don’t know which of those, you can’t just say here’s the department that should lead it. It’s the person who sees the bigger picture. Who transcends those three departments in their vision. And so I always say, we’re looking for somebody who gives a, somebody who gives a, somebody who gives a crap. We’re just looking for somebody who gives a crap. I don’t care what department they come from because really they have to work together. And so is it a company who put a CRO in place who thought they were head of sales, but now we need to expand the wing? Or is it marketing because generally they, they build strategic processes and they implement things like this. And arguably the customer journey is very digital and self service.
Tim Riesterer:
So they’re like, we own a lot of this, we might as well help integrate the rest of it. I think customer success is just figuring it out. They’re building these teams and they’re just trying to keep adoption up, keep NPS scores up. So they’re still trying to figure out how to be commercially savvy because they’re really just trying to do what’s defined in customer success. So it’s good to emerge probably from sales and marketing, but I’m going to see and argue that possibly that what maybe we all thought was a goofy sort of idea of chief revenue officer or revenue optimization or revenue enablement is actually going to be not just some sort of a clever, cheesy new title, I think is going to be almost a mandatory responsibility.
Tim Explains What Is Sales Enablement and the People Who Should Be Responsible for it · [15:50]
Will Barron:
You see this, how do I phrase this, how you commented on your own customers, but is this a problem? Is this a hurdle? Is this a status quo that you have to break when you go into an organisation and you start talking about some of this? Is it difficult to find that one individual you can say, hey, you are light years ahead with your thinking of everyone else, let’s give you some of the ownership of this. Is that, it almost seemed Tim that you were, it’s a problem to find that individual who can buy in and make all this happen.
“Honestly, sales enablement as a title has been vested with lots of responsibility but not a lot of authority and budget. But they’re also by definition the people who I think are trying to think of this as a process and trying to think of it as a puzzle that needs to be put together because enablement’s always kind of been a pipe that connected marketing and sales and is now figuring out how to connect customer success.” – Tim Riesterer · [16:54]
Tim Riesterer:
Yeah, I mean you are looking for someone who cares about maybe a little more than their on paper remit. So I was just talking to a client this morning where all of this is being driven out of marketing. They’re building new messaging and launching that messaging and skills courses to help the sellers up-level their capacities. But then in the next breath, we’re talking to chief sales leaders and their sales enablement heads who are looking at their jobs and going, I’m really enablement of everything. And I think there’s an opportunity there because honestly sales enablement as a title has been vested with lots of responsibility but not a lot of authority and budget. But they’re also by definition the people who I think are trying to think of this as a process and trying to think of it as a puzzle that needs to be put together because enablement’s always kind of been a pipe that connected marketing and sales and is now figuring out how to connect customer success.
“I just heard a Forrester report that said they think by 2024, that 50% of sales enablement will report to marketing.” – Tim Riesterer · [17:29]
Tim Riesterer:
The problem is that in the organisation, they’ve just been at too low a level to be vested with the kind of budget and authority. I just heard a Forrester report that said they think by 2024, that 50% of sales enablement will report to marketing. So whether that’s an oxymoron or that’s a trend, what does that speak to? Well again, probably to sales enablement. Has got the right idea, but it needs to roll up to a group that has more of that long-term strategic go to market planning view as opposed to maybe quarterly number revenue view.
Do Businesses Need a Modern Chief Buying Officer? · [18:24]
Will Barron:
Yep so I don’t know anything about the data. I don’t have the insights with clients that you do Tim, but it seems like that’s common sense or at a chief revenue officer someone like that, it seems like somebody with the modern buyer journey being so digital, so much of it is done before they even speak to a sales person. It seems like someone to manage the… You almost need this would be even more cheesy than Silicon Valley ask, we always need a chief buying journey officer or something like that.
Tim Riesterer:
Well I was recently quoted as saying, we need to stitch together these three operations in a customer conversation continuum because they’re each conversations with the customers taking place at different inflexion points but the customer sees it as one single monorail they’re riding. I’m just riding your company’s monorail. And here we are trying to jack up all the different pylons to hold it up. So, yeah. Who transcends that and assumes that view which is the view of the customer likes to think they have and likes to think the organisation is aligned to? It’s got to happen. I mean it just literally, there’s just no way this can’t happen in the short term.
Understanding the Buyer’s Journey From The Expansion Side of Things · [19:10]
Will Barron:
For sure. Okay, so let’s move back into the expansion side of things here. So we know and we’re heads over the head with this stick constantly that the buyers are engaging with salespeople less later and later in the buying journey. How does the buying journey look from the perspective of an expansion? Is it salespeople leading the expansion? Is it the buyer going into the product, getting more training, more data, kind of more marketing and say, hey, we want to grow this ourselves. And then reaching out to sales. How does the buying journey look from a high level, from the expansion side of things?
Tim Riesterer:
Well the one thing it is, if you think of old old-timey sales process, you’d have your opportunity management for new logos and your account planning or account management for existing. And then companies had to decide for themselves, are we going to split that job? Are we going to have them do the same job but they just got to be situationally fluent. That’s like one of the things that’s changing is that this influence of customer success has taken the account management side of the seller’s brain or that team and said, hey, we need to infuse in your desires to upsell this sort of ongoing dialogue. We need to have business reviews. We need to be documenting results and bringing these results. We need to be doing sort of regular co-visioning sessions that feel like relationship management not account management which is kind of still transactional.
“Once somebody is a customer, everybody needs to think they’re in the business of customer success.” – Tim Riesterer · [21:03]
Tim Riesterer:
And people think of moments like, oh, I got to launch this new product to my existing business. Or I got to go after this white space. It moves from a selling mindset to a success mindset. In fact, I was talking to the EVP of Sales at Salesforce who is a client of ours. And he says, “We’re thinking of just calling it all customer success. We’re in the business of customer success, sales isn’t even a thing.” He says, “I want to banish the word handoff.” And so I guess what I would say is that once somebody is a customer, everybody needs to think they’re in the business of customer success. Now who takes most of the commercial responsibility, that’s the question? Does the sales side of that initiative still own the number and run the opportunities with an existing customer? With customer success as input based on their observations? So they’re like now think of customer success as the demand generation funnel for account managers.
Tim Riesterer:
Or are more and more commercial moments going to be vested in the customer success org because they’re always there. It’s a lower cost organisation typically. And hopefully it’s always building on something they’re working on. And then you get the debate with customer success going, no, no timeout. We don’t want to be sales, eww. So I guess I’m giving you the lowdown on all the dynamics that we see when we’re inside these companies. And it’s a little bit up for grabs. Everything in terms of org structure, but not in terms of the mindset and the approach, that’s being settled as continuous business review, oriented dialogues, that document results demonstrate investment and effort. Oh, and then by the way, let’s talk about some potential other things I think is that’s a good mindset to be in as opposed to, now I’m just going to start transacting opportunities with my existing customers.
Customer Success Versus Sales Expansion: Which One is More Profitable Because Sales Clearly Drives More Revenue · [22:30]
Will Barron:
For sure. So there’s a tonne of questions about culture here that we could perhaps ask. The culture within sales teams. And if that was different, perhaps customer success would be more interested in moving into that space. But is there any data on if customer success owns an expansion versus sales owns an expansion. I guess from the profitability of it, if customer success is a lower cost part of the organisation to run, perhaps not commission-based, sales is more commission laden. Clearly customer success will have to do less expansion to be more profitable versus the sales team. Is there any data on kind of that front of which one is more profitable as opposed to which one drives more revenue overall, which I would assume is sales?
“There’s a commercial mindset about how to get a deal over the line that I think when you’re a customer success, you’re kind of like a subject matter expert on that customer relationship and your implementation. But it doesn’t mean you have the commercial chops to manage a deal, close the deal and get all of the different players involved in that transaction. And that’s just a special skill set of sales that is going to be hard to match.” – Tim Riesterer · [23:12]
Tim Riesterer:
Yeah, not yet. And I would assume too by the way. There’s a commercial mindset about how to get a deal over the line that I think when you’re a customer success, you’re kind of like a subject matter expert on that customer relationship and your implementation, but it doesn’t mean you have the commercial chops to manage a deal, close the deal and get all of the different players involved in that transaction. And that’s just a special skill set of sales that is going to be hard to match. So I think you’re right. I mean, you might a lower cost of sale but I feel like you’re going to get sales as they would have sort of just fell in your lap, happened anyways maybe with a couple sort of Amazon S recommendations from customer success, well other coaches like you have bought this.
“All I’m saying for the salesperson in the customer success expansion is think of your cadence differently in terms of renewal cadences and upsell cadences as more business review oriented and be great at documenting current business results so you can build on that success as opposed to treating it like each one’s a new transaction.” – Tim Riesterer · [24:09]
Tim Riesterer:
Versus having a very systematic and commercial savvy approach that sales brings. I think that all I’m saying for the salesperson in the customer success expansion is think of your cadence differently in terms of renewal cadences and upsell cadences as more business review oriented and be great at documenting current business results so you can build on that success as opposed to treating it like each one’s a new transaction. That’s the mindset shift there. Just be a little bit more of a customer success partner who happens to have commercial skills. And I think that’ll carry you a long way.
Will Barron:
How do you see this playing out over the next 10, even 15, 20 years, however far we need to look before some of this perhaps changes. In that as you described, the buyer more than happy to spend not tens of thousands or hundreds of thousands, perhaps you even millions online. Sometimes am I even speaking to a sales person at all. They can log in, especially with per seat pricing on products and things like this. They can scale, they can manage a lot of it on the road. If the product is set up correctly and they’ve got good customer success.
Will We Ever Get To a Point Where Buyers Will No Longer Need Salespeople? · [25:08]
Will Barron:
Will we get to the point where buyers, just there is no salesperson in the buyer’s journey because the content is so good, the marketing is so good and accurate, the analytics. We we can give people what they want when they need it to get them over the line, to break status quo, to do some of the things that salespeople typically have to do in person or over a Zoom call, whatever it is. Will we ever get to the point where sales is even less needed to the point where customer success does most of the jobs? So let’s not bother creating this whole path of the organisation in itself?
Tim Riesterer:
I mean now we’re just trying to prophesy the future. And I…
Will Barron:
I won’t hold you to this. I won’t call you up in a decade from now and be like, Tim, you said this. [crosstalk 00:25:55]
Tim Riesterer:
But I guess when I hypothesise, I’m clear to say it so that no one says I’ve got any sort of crystal ball here. I think that this is the reality that when you think about now when your solution becomes more integrated as a part of the service offering and experience of the customer. And it’s woven into their DNA if you will and now you are clearly, you touch their data. You know this, you know that, that’s a little harder to just sort of go reverse auction it. Even like AWS has got a large sales force that engages serious enterprises. But you can also go to their website and they got their price list there and you can buy their stuff. So I think that that’s how companies are going to be in general. And then it’s going to be sort of preferred method.
Tim Riesterer:
And it’s also going to be, am I just going to buy this as a customer and I’m going to add all the value? Or am I going to buy this and expect that my partner adds that ancillary value to it? Which then requires just a working knowledge and integration with the business. So I think as companies decide what they’re going to be, that’s going to dictate what level of sales and type of skills will follow.
Tim Explains How Customer Success Will Demand That Salespeople Evolve From Deal Makers Into Subject Matter Experts and Consultative Partners · [27:27]
Will Barron:
Sure. Let me, I’ll take you a few step backs then. Do you think it’s more or less likely then that perhaps sales people will become, whether it’s with AWS a subject matter experts on that and really be able to add value as a consultative partner as opposed to what we can perhaps get away with right now which is a deal maker, someone that’s in your words can get the deal over the line?
Tim Riesterer:
Yeah. I mean, I still think that’s going to be a necessary skill because I don’t think we’re going to get fewer decision-makers. And so somebody’s got to help get a decision done. But I have a bias, I’m a consultant by nature and that’s the kind of value I like to add. And I hope that our clients see that as the value we bring in addition to the intellectual property that goes along with it. So my bias definitely is toward that. But I’ll give you an example. We’re working with a company that does large managed services, sort of building automation. But now they have a couple commercial motions, renewals and then they have some upsells. Like you might have this serve, you have our building automation, but you have our fire service but not our security service. And so there’s sort of these other motions that, oh, you bought, you have our service contract but you don’t buy our parts.
Tim Riesterer:
And what we’re starting to see now are sort of these situational commercial squads being formed. And then they get on a cadence and they look at their target market. Like who’s got the service agreements that don’t have the parts, boom, they run a cadence to try and upsell parts. And here’s a group that has fire but not security and not this, let’s run some upsells based on what’s installed and what their installed footprint is.
Tim Riesterer:
And oh by the way, this renewal just seems to be almost an auto renewal. So let’s just put a light touch on that. So I think people are going to start looking at commercial moments and determining exact right staffing, resources, skill sets and channels and avenues. Not that we haven’t done that. Some people are like, oh, low volume, that goes to somebody who’s at a desk. Medium volume, that somebody who goes to a strip mall and sells there and then large volume, we have cross-functional strategic accounts. I mean that’s always been sort of the thing, but I feel like it’s getting, what I’m seeing is much more specific now. Especially when you have a company that’s got this core platform of recurring revenue and now they’re doing spot commercial programming, messaging content, skills teams and cadences to go after that. That’s what I’m experiencing right now. It feels like the wave of the future to be that kind of targeted because the tools and the technology, the data, everything’s there to do that.
How to Identify Opportunities to Upsell · [30:28]
Will Barron:
Is this, and coming to these commercial I guess insights, these commercial opportunities to upsell. And it’s an obvious one. If you’ve got all fire suppression product, perhaps you want to integrate it with our security product because they both go into the same data centre. We can do cool things with the app. We can do multiple alerts, whatever it is. That seems like an obvious one. When we move forward from this point onwards, is it going to become more or less down to people’s experience to spot these kinds of things, these opportunities. Or are we going to be more and more reliant on data and algorithms and software to tell us that this customer probably due to the history of customers like it, is probably going to look at this obvious solution as well.
“Some things are not just upsells but some are like migrations.” – Tim Riesterer · [31:01]
Tim Riesterer:
Yeah, of course the robots are taking over. I mean it’s machine learning Will, it’s AI. So I’ll stay with my building automation example. They’re trying to convert. So some things are not just upsells but some are like migrations. And they’re like still, boy we have a lot of expensive field techs going out and doing this. Can’t we convert all these people to our remote maintenance platform? And can’t we get them all to come to our portal and self-diagnosis. And start to go to the portal and realise, oh, I got some red dots there on my dashboard. Maybe I should order some more of those because of the data feeding it in. So I am seeing hints of like moving on-prem service to remote diagnostic preventive service, moving people into portals, as opposed to talking to humans so that things just sort of are automagical.
“I think humans are still going to have to hear a story, see a story, read a story or be told a story in every one of these environments, whether it’s self-serve or led by a sales person or customer success. So the ability to frame and tell a better story and having meaningful persuasive conversation is still part of it.” – Tim Riesterer · [31:50]
Tim Riesterer:
I have to believe that at least everybody who’s building the technology and everybody who’s looking at their company is thinking about these things. Now, I’m shooting myself in the foot if I don’t think there’s still going to be important customer conversations. But some of these are just going to happen in a self-service environment. I think humans are still going to have to hear a story, see a story, read a story or be told a story in every one of these environments, whether it’s self-serve or led by a sales person or customer success. So the ability to frame and tell a better story and having meaningful persuasive conversation is still part of it. It’s just going to show up in, oh gee, that was a social post or an email blast or it was a message that popped up on my dashboard.
Tim Riesterer:
We’re just going to have to look at where those customer conversation touch points are and make sure everyone is dialled in. So I don’t know. By the time that’s all happens Will I’ll be long retired from this business and no one’s going to be able to come back and haunt me, but it does feel, it feels like it’s tipping the direction that we’re talking about.
Tim’s Thoughts on AI Content Creation · [32:50]
Will Barron:
Yeah. I won’t name this service. It’s better because I can imagine what you might say about it. But there’s quite a few services that are popping up at the moment that are claiming to use AI. To be clear, it’s not really AI, it’d be machine learning, whatever it is, to write ad copy, to write stories, to be able to create content. What are your thoughts on these kinds of services now Tim because as a sales leader, a marketing leader, this seems like you can create masses about our content at scale and really control the buyer’s journey when perhaps our team isn’t big enough to do some of this at scale otherwise. Is there lags to software tools like this when we’re talking about what you guys specialise in, which is conversations and stories and really human psychology and being able to communicate at a deep level to persuade people and to change status quos?
Tim Riesterer:
Yeah, I mean I think you can put frameworks in place to say, if this is a new logo acquisition, these are the kinds of things you need to say. And in this order they need to be said, and if they respond this way, you could probably put a library of choices in there. That said, we’re doing an experiment right now. We just got the initial results. So I’m going to break the news here. We tested different value propositions and it was being read by an audience. We had hundreds and hundreds of people reading these different value props. And really all we did is we took the same core story and we treated the value props differently. So one was, hey, let’s just talk about the features because less is more. Oh no, we got to talk about feature and benefit because they have to see not only what it is but what it does.
Tim Riesterer:
And then another one was no, we have to add superlatives because it’s an all in one, it’s a one-stop shop. It’s the most streamlined, most comprehensive. So we did a superlative version. Then the fourth version we did something using the science of telling details, like adding extra details. Don’t just say you have a large database. You can be, it’s a database of 800,000 potential truck drivers that you can review. And it’s not just a large database. It’s one where everybody’s already had five-year screens on criminal checks and this. So you give telling details and it defies the whole less is more sort of thing. And it adds more emotional language into it.
“I’ve got to believe that there’s still going to be a world and a need for differentiated, persuasive content.” – Tim Riesterer · [38:39]
Tim Riesterer:
And by a moonshot, the telling detailed version, emotional language, layered extra phrases and numbers and specificity one. And I guess I don’t know when the machine learning and the AI is going to figure out how to put the right telling details in at the right time or even that telling details are better because it can only do what it’s programmed to do. So we’re still doing research and finding out how humans react to copy that inform the way we need to continue to adjust it so that we can distinguish and differentiate ourselves, not just sound like everybody else. And I got to believe there’s still going to be a world and a need for differentiated, persuasive content and we’re going to keep testing it. And we’re going to keep finding some of these things.
Will Barron:
I love it because that sums up where I think we are with for a better or worse my opinion on this Tim where we are in sales. We can use enablement to prompt people to have message templates, we can do all this stuff. But what you just described is the difference between something that I would probably say if I’m talking to someone, I would probably share these details more likely than not. Versus I wouldn’t just have a conversation and say, we do these three things then sit back in my chair and wait for the person to respond. There’s a human element to adding details to storytelling, whether we’re trained in it or not. And I feel like we’re in this crossroads where I’ve used some of these AI tools to create copy and they’ve all been terrible so far.
AI Can’t Compete with Human Differentiators of Top Salespeople · [36:35]
Will Barron:
I’m sure they’ll get better. That’s why I didn’t name any because I didn’t got to know what you’re going to say on it. But they’ve all been terrible. And it seems like we know where we want to move, where we want to create sales people, customer success people, even marketers that follow a script. We just programmed them with what we think and what we assume that works or what AB testing that works. But we’re not quite there yet because there’s a human element which is very difficult to translate. It could be even just the way you speak. If you’re using certain words, languages in congruence, to just read from a script. I feel like that’s super important right now as leadership as we start using more of these sales enablement tools, there is still a talent element of all of this isn’t there to make it work when we get down to our individual sales contributors having those conversations.
“As long as robots aren’t buying from robots, as long as it’s still humans buying stuff from humans, there’s going to be room for this (human differenciator)” Tim Riesterer · [37:27]
Tim Riesterer:
Yeah. Just to your point, even right down to this idea of do you have a best friend voice or do you have presenter man voice. So I agree. I don’t believe that as long as robots aren’t buying from robots, as long as it’s still humans buying stuff from humans, there’s going to be room for this. So no dire predictions here in the near future, I think just adjusting and developing the right skill sets that will separate you. If I can real quickly tell this story.
“When they studied 103 million hands of online poker. And what they discovered using all the analytics is that only 12% of the time did the best hand win. 88% of the time, it was the best player that wins. And they said the best player is the one who told the best story by the way they bet, the way they bluff, the way they took cards, didn’t take cards. So they told a certain story and they outperformed people who actually had better hands. That tells me there’s a lot of room yet for winning with the best story even at the expense of potentially a better alternative solution.” – Tim Riesterer · [37:51]
Tim Riesterer:
I saw this study, I don’t think we talked about this last time Will where they studied 103 million hands of online poker. And what they discovered using all the analytics is that only 12% of the time did the best hand win. 88% of the time, it was the best player that wins. And they said the best player is the one who told the best story by the way they bet, the way they bluff, the way they took cards, didn’t take cards. So they told a certain story and they outperformed people who actually had better hands. That tells me there’s a lot of room yet for winning with the best story even at the expense of potentially a better alternative solution. So I think that’s real, even in sports and other things that are super analysed. So there’s the opportunity for sellers. They just now they got to figure out what it means to be the best player in the coming future.
Will Barron:
I love it. And just to juxtapose your actual research data there with I’ve got a friend who’s a professional poker player. And he plays online exclusively and he pays thousands of dollars a month for this tool which essentially starts to try and predict what’s happening at the table. It will monitor all the tables within the I guess website that he goes on to so he can pick the table I guess with the biggest idiots that he can fleece. To be blunt about it. He probably wouldn’t frame it up like that, but people with-
Tim Riesterer:
Where’s the sport in that.
Will Barron:
Yeah. But he says what, which I find really interesting because he tracks, every day tracks everything. It’s all automated and he can compare his success and losses over the course of months, years and probably even decades at this point. He has more success when he trusts his gut and occasionally goes against what the algorithm and the machine learning of the data is suggesting. And it’s because humans are irrational. The humans around the table who were playing with him, they’re not being completely rational. They might have the same tools, but they’re all using their gut feelings occasionally as well. And so he’s really clear with his data and the patterns, he’s going to publish some content on this in the not too distant future. So I’ll link that in the show notes for this episode when it does come out.
Top Salespeople Can Compete With AI By Leveraging The Psychology of Human Decision-Making · [39:54]
Will Barron:
But when he trusts his gut and uses I guess, decades of experience with the game, he can beat what the algorithm is telling him because it’s not just us playing. And it’s the same with sales. It’s not just the seller, it’s the buyer, we’re all irrational. We’ve all got cognitive biases. And as you said, until we’ve got the seller AI connected with the buyer AI and we’re all out with jobs, we’re probably safe to say that there’s an element of talent here that we need to always keep at the back of our minds.
Tim Riesterer:
Absolutely. I mean it’s still the psychology of human decision-making at work. And I love that story on top of the study that I looked at because what they said was, it’s the one who situationally understands the psychology which doesn’t mean they understand the rationality. In fact, as you said, they understand the irrationality of what’s about to go on and they learn how to work that. They can build a story in the way the decisions they make that the other person sees that tells them that other player what they want them to see. And the person with the best hand goes, I’m out. So it very powerful stuff. I love these kinds of conversations.
Tim’s Book: The Expansion Sales and His Company Corporate Visions · [41:03]
Will Barron:
Love it, same here. With that, tell us where we can find the book, The Expansion Sale. And tell us more about what you’re doing over at Corporate Visions and where we can find out more about yourself too.
Tim Riesterer:
Sure. So The Expansion Sale came out now just a year ago and it’s been a well-timed book. You can find it at Amazon or any it’s published by McGraw Hill. So where any books are sold, you can find it. Recently came out on Audible as I understand as well. So find that The Expansion Sale were all good books are sold. Corporatevisions.com, corporatevisions.com is where the company I work with presents the work we do in the consulting and training around messaging and content and skills.
Tim Riesterer:
We just recently started branded our research work uniquely. So there’s a URL called B2Bdecisionlabs, B2Bdecisionlabs.com and we have started a much more formal research arm where we have behavioural study. We have a brain lab now. We have our own brain lab with the EEG caps and everything else run by a cognitive neuroscientist. And we have field trials. We have call centres that we’re running field labs in to test out let’s say messages and cadences and other things. So a real dedicated effort and brand new research like the stuff I was talking about in terms of differentiation coming out from all three labs on a quarterly basis.
Will Barron:
Sure. That’s super exciting. The audience will know, you may know as well Tim, my background is in chemistry. I’ve been published in the Journal of Competitional Chemistry. And so when you talk about science, data research, EEG, ECG, whatever it is that gets me excited because, and I’ll big you up and plug you in a slightly here Tim. There’s so much BS that goes on in the same sales trading space. And what you’re talking about here. There’ll be, you’ll be saying this on one end of the conversation with your data and research to back you up, there’ll be some red faced bald shouting man at the other end of the conversation trying to just share anecdotes and share his experiences or her experiences. And you’ve got to lean audience sales nation, you got to lean towards Tim and what he’s doing because if it’s research backed and the research that you’re doing, it’s just so important in this space where there’s just, charlatan might be a strong word, but there’s a lot of people saying a lot of things when there’s no evidence to support what they’re doing whatsoever.
Tim Riesterer:
We call it unexamined folklore. We try to euphemistically. So yeah, I usually say, where’s your study. And I’m not going to make these kinds of decisions and these bets without having some data to support it. So always a pleasure to chat with you.
Will Barron:
Well with that Tim, I want to thank you again for joining us on the Sales Leadership Show.
Tim Riesterer:
Thank you Will, my pleasure.
