The CAN sales team has been able improve customer satisfaction, close more deals and spend our time more effectively by adopting a 2 part sales process. Our process consists of qualifying our clients during the first sales call, and then returning to make a sales presentation if we think that the client will be able to benefit from one of our systems.
This changes the dynamics of our sales calls, because we are not there to win the approval of our prospects or simply drown them with information on our products. Instead we are meeting with them to research whether or not our products are a good fit for their needs. Our prospective clients appreciate that we strive to only provide our solutions to people that have the need, willingness and resources to purchase our solutions.
We start the first meeting by explaining that we aren’t there to impress them or get them to like us, but to research whether or not we can help their business. We will only make a second presentation if they can demonstrate a clear need, willingness and set of resources. If they meet the requirements and are able to get all of the key decision makers to the second meeting we will present our understanding of their business and problem, and how what impact our solution could have on their business. We don’t focus on the feature of our solution or how it works, but instead on what their business would be like with our solution. (Read a Related Post)
All posts by Nate Watson
Empower the great the build something greater.
Reverse Your Sales Cycle: Research 1st, Present 2nd
Zombie Marketing: Go from Infection to Infestation
At CAN, we love trying to figure out why things work or don’t work. This often leads to continuous experimentation. I decided to unleash this post about Zombie Marketing because it is our latest marketing strategy, it is lethally effective, and, well, it’s about ZOMBIES!
For full-out zombie apocalypse, the key is for the infection to reach critical mass before the authorities are able to exterminate the Differently Animated. For a Zombie outbreak to take over the world you don’t announce it to the masses. Instead, you infect a few key people and let the virus spread quietly. In sales and marketing, as with Zombies, the key is to select the right people to contact, but the ‘right people’ aren’t who most would people usually think of.
When most people think about influential people, they tend to focus on the leaders of social groups, people at the center of their social group with many people listening to them. Although they are the center of their social group, leaders are very difficult people to infect because they typically have a specific platform to protect, and their attention is fragmented because so many people want their attention. Even if you manage to infect a leader without first reaching an overwhelming critical mass, infecting them won’t have as much impact as if you even had already established a small but concentrated infected user-base. A prime example of using leaders as infectious agents is when you get a celebrity endorsement for a product with an established user-base, or a celebrity endorsement for a brand new product that no one has ever used.
Instead of infecting leaders, the key to a successful Zombie Marketing strategy is to infect the influencers in a group. Influencers are people on they edge of many social groups, they don’t have a platform, and they move easily from one social group to the next infecting people with their ideas. Influencers easily develop horizontal friendships, which are friendships between people with different interests, geographies, races, ages, education backgrounds, income levels, and lifestyles. People with horizontal friendships are especially valuable because they are constantly being exposed to new ideas, perspectives, products, and people outside of what would be considered their typical sphere of influence. (Check out a related post on the value of horizontal friendships)
Since influencers are infinitely curious and open to new friendships and ideas, I find them quite enjoyable and relatively easy to infect. However, they require a different method of infection compared to leaders and the masses. To infect leaders you have to get recognized, with the masses you have to push your message, and with influencers you have to allow them to discover something novel. People become influencers because they enjoy discovering new, novel and previously undiscovered ideas.
- Focus Your Content on Solutions to Specific Needs: Influencers enjoy connecting people to solutions to their ideas. In Zombie Marketing you want to make spreading the infection as easy as possible. You want influencers to know that if they find someone with a specific need you have the solution.
- Focus Your Analytics on the Infection: You want your focus to be on developing content that infects influencers, and your content will be guided by the feedback that you receive. So don’t focus on visits or clicks. Instead focus on time on site, conversion, comments and loyalty.
- Provide Consistent Value: When people invest their money or time in something they expect to get consistent results. If you want people to keep coming back to your site you want to provide them with consistent value. This doesn’t mean that you have to post everyday, but that if you post once a week you continue to post once a week and preferably on the same day.
- Promote your Work Sporadically during Off Times: While you need to continually develop great content, promoting your work sporadically and during off times can work in your favor, at least until you gain a significant user base. Not posting all of your content encourages people to keep checking back in with your website to get the latest updates. Post during off times, like Friday, Saturday and Sunday night when most people aren’t posting and yet their are still people hungry for new content.
- Let the Virus Run It Course: In addition to being patient, you need to develop content that is viable over a long period of time. This means that it should be memorable and solve a need that people will have today, tomorrow and a year+ from now. That way once you infect someone with your ideas, they are useful and contagious for as long as possible.
Disclaimer: Zombie Marketing might not be for you if you operate in a perfectly competitive market place with many sellers, many buyers and an undifferentiated product. However, if you operate in a monopolistic competitive market places then a Zombie Marketing strategy might be the right one for you.
Why and How Using a CRM is Important
As a business owner and sales manager, I have found using a CRM (Customer Relationship Management System) to be priceless. Its designed to keep me from becoming overwhelmed by the exponential growth of my sales team and their prospects, deals and customer service cases. While I have used several CRMs, including Salesforce, Sugar CRM and Zoho CRM, at CAN we use 37Signal’s Highrise. We use this one because its values align with CAN’s values.
If you are building your sales team and sales systems, I recommend that you quickly adopt a CRM, or Customer Relationship Management System, because it will allow you to manage your company’s most important asset, your customers. As a sales manager, how you acquire and maintain relationships should be a top priority in developing your sales system. The difficult part is that no customer wants to be treated the same; every customer is different, Download our Case Study. You need to quickly adopt a CRM if you can answer yes to any of the following:
- Do you plan on writing personalized emails to your customers?
- Is it important to you to remember personal details about your customers?
- Do you plan on having more deals, customer service cases, contacts and customers than you can remember?
- Do you plan on having multiple people working sales, marketing and customers service?
- Do you plan on coordinating multiple departments, including sales, marketing, customer service and operations, in order to meet the needs of your clients? (more…)
Refocusing Business Intelligence on Client Needs not Wants
When my partner, Tadd Wood, and I started Contemporary Analysis we decided that we were going to focus on developing a great final product, instead of focusing offering our products at a low cost or focusing great customer service. Not that our prices or our customer services is lacking, but that they are not our focus. We did this because I learned from owning previous businesses that people care about price before they sign the contract, they care about customer service when the product is being delivered, but once the final product is delivered all they care about is the quality of deliverable.
We identified three key principals that we use when building our final deliverables:
- We focus on providing answers to our clients most important business questions.
- Our methodology is designed to provide reliable answers to real businesses.
- We provide answers to our clients’ questions so that they get immediate tasks to improve their business in addition to greater understanding.
The core of these principals is to focus on our clients needs and not their wants. This has been really difficult because what our clients need is answers to their business questions. While it is easy to get distracted by flashy tools, cool visualization and interactive interfaces, at the end of the day our client’s just want answers to their business questions. This is why we decided to refocus business intelligence as presented in the business industry.
How to Build an Analytical Culture
CAN was started in 2008, to make predictive analytics applicable and accessible to businesses of almost any size. To fulfill our mission we have become experts in helping our clients adopt predictive analytics. The first step in adopting predictive analytics is to start building an analytical culture. In an analytical culture, people:
Know the Numbers: Everyone should know what is happening and whether certain strategies were successful. The objective of knowing the numbers is not to judge individuals or the team, but learn from the past and refine future attempts at innovation.
Examine the Numbers: In order to effectively discuss and examine the numbers, team members should be familiar with the numbers, their assumptions, and their application.
Use the Numbers: The ultimate goal of adopting predictive analytics is to make better decisions. This is the hardest and most complex phase of becoming analytical. However, when achieved, this stage provides the highest Return on Investment (ROI). It requires participating members to understand factors driving the numbers, historical paradigm shifts, and the assumptions used to make decisions. Once the factors and assumptions are understood, they can be utilized properly to optimize processes and predict outcomes of specific decisions.
The Analytical Portal
The key to building an analytical culture is to make analytics easy to use, understand, and accessible. The easiest way to do this is to develop an analytical portal. The purpose of the analytical portal is to allow everyone in your organization to know, examine, and use the numbers without having to contact the accounting and information technology departments every time a report or numbers are needed. Your analytical portal should allow people to have access to 5 business intelligence tools:
Dashboards will be used to quickly and easily report key metrics. The key to building successful dashboards is to choose the correct metrics and provide quick and easy access. Dashboards as well as scorecards will allow team members to see the big picture and drill down into finer details on a need to know basis. Dashboards differ from slicing & dicing data in that dashboards are predetermined visualizations of key metrics that are the same across individuals and time.
Detailed Reports are to be read before using analytics to make decisions. These are designed to ensure that statistics, equations, metrics and other reports analytics are fully understood. This will ensure that recommendations are properly implemented.
Slicing & Dicing Data allows your employees to ask questions about the data and get quick responses. People should be able to quickly pull any data that they want from a variety of data sources such as the census, economic data, news sources via text mining, social media, surveys, and internal databases.
Predictive Analytics allows your employees to understand the relationship between outcomes and the variables that drive them. The results of predictive analytics can be used to simulate the outcome of specific decisions and create strategies to maximize outcomes.
Alerts & Notifications are the watchdogs of analytics. They provide a dependable and timely way to bring awareness to team members about important events, but are not distracted by smaller, less significant changes. If properly implemented, managers will spend less time monitoring employees and more time addressing key issues. Alerts & Notifications can be sent via email, dashboard widget or text message.
The Problem with the European Union & Greece with 3 Possible Outcomes
When the European Union was first incepted, the vision was that creating a common currency would reinvigorate the economic competitiveness that was once present in Europe. However, in practice, it has led to a disaster.
The problem is that theory rarely reflects reality. In theory, the European Union (EU) should have helped lagging countries such as Greece by giving them a stronger currency and a more accessible investment pool. Unfortunately, the European Union did both of these things.
Although this sounds like a conflicting statement, there are two important issues that should be addressed. First, before the EU, Greece’s currency had historically been depreciating. Deprecation is when a currency loses purchasing power. Deflation can be economically disastrous because it makes purchasing products from other countries relatively expensive, and it makes it hard to pay back debit because your money is worth less than when you took out the loan, and the increase risk increases interest rates making paying off debit even more difficult. The positive thing about depreciation is that countries exports will be relatively inexpensive.
After being allowed to join the EU, Greece had access a stronger currency and lower interest rates to help finance their expenditures. However, it was much more difficult to finance their expenditures relative to their neighbors in the north because they hadn’t historically been as economically stable. As a result, many of the countries in EU, including Germany, became their creditors.
Second, despite the EU’s goal of creating a stronger, more unified central economy, it continued to allow individual countries to manage their own finances. This meant that while the risk was spread across multiple countries it also spread the risk, without enforcing regulations to prevent individual countries from being fiscally irresponsible. This meant the EU allowed fiscally irresponsible countries such as Greece to readily gain access to funds from the fiscally responsible countries such as German, while not providing significant measures to control the risk and/or compensate Germany fairly for the risk.
Generally, political power is dependent on three factors: the size or production capacity of the economy (GDP), trading network, and macroeconomic stability. In Europe, it is safe to assume that Germany’s Chancellor, Angela Merkel, wields most of power and political influence. Currently, Germany has the 4th largest GDP in the world and the highest in Europe. Germany is also the world’s second largest exporter. Furthermore, according to the Global Competitiveness Report for 2009-2010, Germany was ranked 30th in macroeconomic stability and 1st in infrastructure. Since 2005, Merkel’s leadership and influence has led her to become not only one of the most powerful individuals in Europe, but quite possibly the most powerful woman in the world as well. However, this charge does not come easy. If something is to be done in Europe, she will need to be the one leading the way. This is why she has been under fire for the recent events with Greece’s collapse unfolding. In short, she is dealing with two conflicting sides. One side, primarily the Germans, are frustrated with countries like Greece and don’t believe they deserve a bailout. On the other side, other foreign leaders and economists are stressing that if a bailout does not occur, there will be a ‘domino effect’ collapsing many other countries in Europe. Coincidentally, Europe is faced with a similar dilemma that occurred nearly two years ago in the United States. What is the lesson learned? Her decision must be rational, but a hasty one as well. Unfortunately, she has already been accused of waffling rather than making a concrete decision in recent news.
The Future of the European Union: 3 Possible Scenarios
I see three possible scenarios for the future of the European Union (EU):
- The EU dissolves as a result from uprisings and frustrations from fiscally sound countries,
- The EU is readjusted and fiscally complacent countries are removed (i.e. Spain, Greece, Portugal, etc.),
- The EU collectively decides to form a central agency with limited direct control over each countries central banks to ensure future stability.
The first possibility is a possibility but least likely, because it will ultimately depend on the gumption of Europe’s leaders, including Germany’s Prime Minister, Angela Merkel. The second scenario seems most likely because the European Union’s policies already include requirements and statutes that limit those who can join. However, the challenge again will be whether there is leadership to enforce such policies. The third seems to be the most progressive, least autonomous, and therefore the least likely. As Steve Forbes said in Forbes Magazine, “It’s astonishing that a continent having such deep cultural traditions and a well-educated population should be pygmies when it comes to innovation.” Although this solution draws upon many of the principles of our financial system in the United States, it’s still highly unlikely that leaders will be wiling to set aside their country’s autonomy for increased regulations. Consequently, their predicament is fairly paradoxical.
A Better Way to Calculate Return on Investment (ROI)
Estimating return on investment (ROI) can be a very effective sales tool, however it is difficult to calculate and if a prospect perceives it as a guarantee it can hurt your brand. The problems with ROI stem from trying to reduce, without much investment in time or money, the impact of a product on a business, a complex human organization in constant flux, to a dollar amount that is unique to each prospective client.
The solution is to expand people’s thinking of ROI beyond money to include stress, customer service, employee engagement, communication, quality and happiness in your definition. To make a purchase decision using ROI, you do not need to estimate the exact profit that it will generate, but instead determine if it will improve your business more than other available investments.
One of the best ways that I have discovered to expand people’s thinking about ROI is to use a mental case study where you ask your prospective client to image that they have two identical clones of their business, and one of the clones uses my product and the other does not. I then ask them what differences their are between the two clones as the develop over time. As I guide them through the simulation most of my prospects start to visualize how my products help impact their companies, sales cycle, marketing, customer service, management and strategic planning. If a client is not able to visualize themselves having significant benefits from my product I know not to sell my product to them because either they don’t have a need or they are not willing to invest the time to generate a significant return on their investment.
Why Predictive Analytics is Important
CAN was started in 2008 , to make predictive analytics applicable and accessible to businesses of almost any size. We are working diligently because predictive analytics has the unique potential to allow executives to scale their decision making as organizations and decisions become increasingly more complex with ever thinner margins for error. For example small businesses are now having to compete around the world as if they were multinational companies, and multinational companies are having to develop and deliver products and services to ever more fragmented consumers as if they were small businesses.
Introduction to Predictive Analytics
Predictive analytics is different than other Business Intelligence tools because it goes beyond visualizing data and human assumptions, instead it combines data, theory and math to make forecasts about the future using current and historical facts. While executives and decision makers also analyze current and historical facts to make forecasts about the future, what separates executives from predictive mathematics is predictive analytics ability to find detailed relationships from hundreds of possible variables and millions of observations, and also produce an estimate of the error of the prediction. Predictive analytics is able to tell you that a independent variables, e.g. males, has a .3% impact on a dependent variable with 95% confidence. While executives and managers still have to make the final decisions, predictive mathematics can provide insight that isn’t possible with other business intelligence technologies.
A Brief History of Predictive Analytics
It wasn’t until the middle part of the last decade that we had the combination of mathematical techniques, data storage capacity, data processing power and data creation that we need to make predictive analytics accessible to businesses of all sizes. The mathematical techniques have existed and improved since the founding of the Econometric Society in 1930. The data storage capacity has been around since 1977 with Oracle’s commercialization of the relational database. The processing power has existed since IBM commercialized business computing with the IBM 360. SaaS and Social Media provided the final requirement, data creation. Both of these technologies have made is common and inexpensive for people to quickly and easily collect and publish information about their lives and jobs.
The Limitation of Predictive Analytics
Predictive analytics is not without flaws and if people become over reliant or trusting of predictive models you can have disasters such as the subprime mortgage crisis. To avoid hubris and ensure that our customers can trust our models, CAN has developed the philosophy of Less Wrong and the CAN Three-Way Test.
The philosophy of Less Wrong is that the goal of every model that we produce is to make our clients less wrong than they were, but not to assume that we will ever make our clients 100 percent right. In business their are often clear winners with clear metrics such as profit keeping score. However, no business is ever perfect, the winners are only Less Wrong than their competitors. Also, business success and failure is only temporary. The ability to help companies continually become less wrong is what attracted CAN to predictive analytics. By combining data, theory and mathematics CAN helps develop predictive models to help our clients make decisions that are Less Wrong.
Our philosophy of Less Wrong has allowed us to develop business model that allows us to quickly and inexpensively provide results to our clients. Similar to Software as a Service (SaaS) we provide Analytics as a Service on month-to-month contracts, and we use our ongoing relationships to continually help our clients becomes Less Wrong. While we provide our clients with results within the first 30 days, we are continually improving and adapting our systems to an ever changing business environment.
While the philosophy of Less Wrong helps to establish reasonable goals and allow room for continual improvement, our models provide the foundation of our client’s business, and so we work hard to make sure that our models reflect reality so that they generate reasonable predictions. One of the best ways that we do this is the CAN Three-way test. The CAN Three-way test requires that each model we produce can be backed up with theory, data and math.
- The Theory: Without a sound theory, you have to rely on randomness, and randomness decreases the long-term usefulness of the model. CAN relies on the expertise of our clients executives, managers and employees to build the theories around our models.
- The Data: CAN makes sure to fully understand your data, because data is the raw materials used to build predictive models. CAN will examine patterns in your data to determine which equations to use to model your data, and also determine the quality of your data. CAN is able work with imperfect data, we just make sure that we understand the flaws and limitations of your data, such as potential bias etc.
- The Math: CAN’s analysts go through hundreds of different models to select the right one that fits the data as well as the theory. This doesn’t mean that we always select the equation that has the best line fit, but instead the equation that fits both the data and the theory.
Insurance Client Stories-Contemporary Analysis
CAN has been fortunate to help a number of Life and Health Insurance companies work smart. It has been a great relationship because clients from Life and Health Insurance companies understand what we do as they are experts in using mathematics to forecast human behavior on a biological side, and CAN is an expert in applying predictive analytics to forecast human behavior on a marketing and sales side. Our customers invest in developing new products, and we use math to make sure they can distribute them most effectively. The following are some of the solutions we have developed:
Marketing ROI with Terrain: Our clients wanted to know the ROI of their marketing campaigns, but had been struggling to develop a system that was able to determine the impact that their marketing was having on sales. We agreed that it would be too difficult to explain the impact that a company’s marketing was having and instead we used CAN’s Terrain system to explain the impact that the economy and seasonal fluctuations had on sales. With every predictive model their is a residual x-factor that can not be explained in detail. So instead of including the economy, a major driver of purchasing decisions, in the X-factor, we included the company’s marketing in the X-factor. While they did not exactly accomplish their goal of measuring the ROI of their marketing activity, we were able to explain how economics and seasonality impacted sales and the residual could be attributed to marketing, competitors and other factors. Now our clients can get a reasonable idea if marketing is impacting sales.
Client Management: Using Pulse, CAN helped our clients understand and improve their client portfolio by modeling the factors of client profitability, loyalty and claim activity. Each week we provide our client with a list of the clients that are at risk of leaving within the next 90 days, and a list of sales leads that have a high probability of being profitable and loyal clients. Each month we provide them with a report on their client portfolio relative to the population and their goals.
Sales Management: Using Beacon, CAN has worked to connect agents and brokerages to our clients home offices. Beacon has been used to focus the development of leads and marketing materials to best serve the needs of agents and brokerages. Beacon also has been used to improve communications with training, regulations and promotions between home offices and agents by segmenting agents by learning styles and providing communication guidelines to our clients.
Scaling 1 to 1
As a business owner and salesperson I require time to myself to think, rest and connect with people, however their are always others that want my attention. I have had to resort to locking myself in my office and forcing myself to focus at the expense of the world around me. However this alienates people and can be very lonely. The following is a list of my ideas about how to scale 1 to 1. I decided to put my ideas into a blog post because I want to share my ideas about how to scale 1 to 1.
A Chauffeur to the Virtual World: It is important that you and your employees are always carrying business cards because they are the easiest way to chauffeur realtime face to face interactions to non-time sensitive virtual interactions. This allows you to spread out interactions so that you eliminate bottlenecks. It is important to ask for the other person’s business card to make sure they know that you actually want to connect. Explain that as much as you want to jump into the relationship right now, you want to reconnect at a later time so that you can give your full attention.
Transition Meetings: In order to scale 1 to 1 it is essential to move interactions from the physical to virtual. I resisted moving my meetings from physical to virtual. However, over the last year I have moved almost all of my meeting to the virtual world. I was sick of spending hours driving back and forth, and showing up late to meetings because of traffic, exhaustion and bad planning. The key to moving meeting to the virtual world is to properly set up your virtual meeting room. At first my virtual meetings felt awkward and where full of technical difficulties, and thus it was difficult to establish rapport with the people I was meeting. After investing in a camera, professional grade studio microphone, a professional physical space, and a wired internet connection, I was able to establish the same rapport with my clients as my physical meetings. I think the key was that I was comfortable, especially since I didn’t have to hold a microphone. On the software side of virtual meetings I highly recommend using Skype and Glance.net. They are very simple systems that load very quickly.
A Lobby Full of Ideas: Developing a lobby allows you to add value to people that you have just met and also your current clients when you are not around. CAN’s lobby is composed of a set of standard emails that are well thought out with content specific to different types of people we meet in different circumstances. For example we have a list of our favorite things that we send to people we have just met introduce them to a few of our favorite things, our products and our company. The goal of our lobby is to enhance the CAN customer experience by introducing potential customer to CAN and our products so that we can spend our face-to-face time engaged in learning about our customers and not telling them about CAN. CAN is currently working on a series of emails specifically for people we have just met, people interested in our 5 products, and clients of our 5 products.
Scale Conversations: You can use your blog to scale 1 to 1 by writing about frequent conversations that you have, and then inviting people you engage with to add their thoughts. This moves your realtime face-to-face interactions to a non-time sensitive virtual interaction, and you can network your new connections with other people that are having a similar conversation.
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