It’s Valentine’s Day – a day when we celebrate the role that marketing and sales plays in our personal lives. And in honor of Valentine’s Day, let’s take a look at a new trend in marketing and sales.
Many of my clients love sales and hate marketing. Sales is short-term, tangible, clear – what’s not to like about sales?! On the other hand, marketing is long-term, more subtle and intangible, and much less clear. Unfortunately, many business owners never get past that black/white dynamic to see that marketing is one of the most important pieces of the puzzle to grow a business.
Good marketing – at the small/mid-sized business level – has always been about driving revenue – getting more people to buy more, sooner, at higher margins. But that’s often overlooked when marketing focuses on tweets and clicks and likes and pretty graphics.
Fortunately, there’s a new trend that focuses more on the good kind of marketing – that trend is Sales Enablement.
Sales Enablement is how marketing helps sales – it’s the tools, systems, content, and support that salespeople use to engage prospects efficiently. Because there is more competition today than there used to be, businesses cannot afford the inefficiency in the sales process that used to be OK. Marketing brings scale, consistency, and clarity that brings down the costs of making the sale.
At a recent marketing and sales retreat I led, we reviewed a Hubspot video on Sales Enablement. It said that 70% of the buyer’s decision is made before they even talk to a salesperson. In other words, most of “sales” actually happens during the phase that is usually handled by marketing.
What does the trend toward Sales Enablement mean for you?
- Most small businesses are overinvesting in salespeople and underinvesting in their marketing.
- Sales needs to describe to marketing what it’s hearing from prospects and customers, and what it needs to address buyer concerns.
- Marketing needs to create for sales standardized tools and strong, consistent messages to make the sales process more efficient.
- You need to appreciate what a strong connection there is between educating prospects about their needs, and making sales. Buyers are making their decisions while they’re learning…in fact, because of what they are learning.
Sales Enablement can help you generate more revenue more efficiently. If you think your sales and marketing are not keeping up with the times, you should use the topic of Sales Enablement to open a discussion among your leadership team about how your approach could change.
Stage 2 companies must already have a clear and compelling value proposition if they’re successful enough to have grown out of start-up, right?
Well, yes and no. They do have enough traction in the marketplace to show that they have a value proposition that works. But it’s actually unlikely that the company has a systematic way to communicate the value proposition. And if that is the case, it will find that revenue growth is harder and harder to achieve – and in a competitive market, the company may start to lose ground to other companies who are communicating their message better.
What should a value proposition look like? When I started out in marketing, I worked with an excellent marketing agency, who explained that the “brand positioning statement” should follow a classic formula of, “For [market segment], Our Brand is the [product category] that [customer benefits] by [points of differentiation].”
So, for a clear and compelling value proposition, you need:
– A clearly defined target market segment or customer profile – is it marketing directors who work with global brands, or owners small businesses in cities, or…
– A definition of the product category – the marketing agency I worked with explained that orange juice could be defined as a breakfast drink or as a health drink, so picking the product category has a big impact on how the product itself is perceived
– A description of the customer benefits – what are the pains you alleviate (lost revenue, production downtime, etc.) and gains you enable (new revenue sources, talent retention, etc.)
– The points of differentiation – choosing from all the ways that your product works or the ways you deliver your service, what are the ways that set it apart from the competition?
Once you have your value proposition, make sure you reinforce it with everyone in your company, and you use it to focus your marketing and sales messages.
“Value proposition” is one of those phrases, like “paradigm shift” and “synergy”, that started out as a good idea…but was then so overused that a lot of people don’t understand the importance of the original thought.
But a clear value proposition is as important as ever, especially for growing and Stage 2 companies that are past start-up.
What is a value proposition? It’s a statement that describes who your customer is and how you make them better – the value that you create for them.
To get a better idea of what a value proposition should be, let’s look at the good, the bad, and the ugly of what it can be.
In my work as a marketing strategy consultant, I get to see all kinds of value propositions. Usually, they are OK, and have some redeeming qualities. But there are some that are simply awful.
The worst has to be a statement like, “We offer our value proposition to our customers.” In other words, the value proposition is… “our value proposition.” You can see why that would be a problem – it doesn’t describe who the customer is or how they improve. Often, if asked to tell more about the value proposition, these people will say, “We offer good service at a low cost.” That makes me cringe, too, but that’s a subject for another column…
Another ugly value proposition is doing everything for everybody. I recently asked the CEO of a marketing firm who his target market was, and was shocked when he shrugged his shoulders and said, “We work with pretty much anybody.” (Note: if your marketing firm does not have a clear value proposition itself, they can still help, but don’t ask them to develop yours.)
Look at this video – the value proposition seems to be…”we’re the most popular.” I’m sure there was more thinking behind it, but compare this one to the one I show farther below, and you’ll see that it doesn’t say much.
Which brings us to bad value propositions. With these, the company has usually successfully described the customer and the value – but what they describe…is a problem. Here are some examples of value propositions that are a strategic problem for a growing company:
– Basing the value on something only the owner can provide
– Basing the value on being good and cheap (note: please pick one if you haven’t already!)
– Basing the value on flexibility and quality
All of these value propositions work when a company is small and in start-up mode, but they are unsustainable in the long run. It’s almost impossible to grow a company when it is:
– Reliant on the owner to deliver the value (Steve Jobs being the exception that proves the rule)
– Dependent on finding labor that is good and cheap (there is not a lot of good, cheap labor available, folks!)
– Expected to provide high quality AND offer a lot of flexibility
So, what does a good value proposition look like? One of my favorite examples is demonstrated in an ad campaign that came out in 2010.
Listen to what they say they can do for their customers. And look at how they portray their customers – despite their broad appeal, it’s clear they are selling to people who are active. I think this is a great example of an ad being so “on strategy” that the value proposition is perfectly clear.
Here’s what I think a good value proposition looks like:
– It is focused on a specific market that is the appropriate size for the company’s resources
– It is focused on quality, cost, or speed – or if it’s a niche offering, then 2 of those 3
– It clarifies what the company doesn’t do
– It’s been developed by the team, so that everyone understands it and is committed to it
A good value proposition is just one of the pieces of a marketing strategy. If you’d like to learn about the other pieces, feel free to register for our upcoming teleseminar on marketing, at stage2secrets.com.