CEO’s beginners guide to become Sales ready

 

The CEO of a Small and Medium Enterprise is normally the owner. In local lingo we call them “Chalak-Malak” in India. This blog addresses the challenges of such CEO’s with a perspective of becoming sales-ready.

12 Challenges for CEO in becoming Sales Ready

  1. Customer Centricity
  2. Hunger for raw data (contacts)
  3. Robust Lead Generation Engine
  4. A sales process
  5. Reference Selling Process
  6. Cross Selling and Up selling Process
  7. Negotiation Tool Kit
  8. Customer Relationship Management (CRM)
  9. Monetizing Customer Life Time Value (LTV)
  10. Customer Loyalty Program
  11. More Customer per Customer (MCPC)
  12. Sales Entropy in the system

Let us understand each of these challenges one by one.

1. Customer Centricity

customer centricity

The alignment of each and every person working in the organisation towards the Green column shown above will lead high levels of customer centricity.

 

The culture of customer centricity cannot happen by chance. It is a well thought of and designed strategy to make your organisation customer centric.

The highest level of customer centricity in an organisation will lead your customers to start owning your products and services to the point of advocating for them.

2. Hunger for raw data to form a contact base

If there is no data with an organisation, the opportunity to use the same to translate the data into information, knowledge, and wisdom respectively, as shown in the DIKW graph above.

After all, the availability of data and proper analysis of the same leads to bright ideas.

3. Robust Lead Generation Engine

a. What have been the sources of leads for you in the past?

 

b. Review the leads in your pipeline and group them in the following categories:

  1. Influencers
  2. Aggregators
  3. Customers

  1. What are the elements of a good sales process?
  2. What are the elements of a good sales process?
  3. What are the elements of a good sales process?
  4. What are the elements of a good sales process?
  5. What are the elements of a good sales process?
  6. What are the elements of a good sales process?
  7. Your ability to translate MQL (Marketing Qualified Lead) to SQL (Sales Qualified Lead).
    MQL= Lead backed up by willingness to buy
    SQL = MQL’s which are backed by capability to pay and urgency to pay.

    4. A structured Sales Process

    a. What are the elements of a good sales process?

b. What are the 7 basic steps of a sales process?

c. Examples of some popular sales process set up by various successful corporates across the world.

5. The Reference Selling Tree

a. Best Practices

b. Happy customers refer well

  • How many happy customers do you have?
  • What steps are taken by your company to keep your customers happy?
  • How do you redeem happy customers?
  • How do you approach happy customers to get more references and business?

c. Reference selling must be done with customers only after a vintage so that they are happy with you themselves first

d. Reference selling, if done well, will give you a thumb rule 15% increment in business. This is because all happy customers give you at least 3 good references.

6. Cross Selling and Up Selling Process

a. Understand the difference between cross selling and up selling

Cross selling always is done with products which complement the buying behavior of the basic product being sold. E.g. Headphone with mobile. When one is selling a higher value of mobile it is upsell.

b. The Essence of Cross Selling and Up selling must be understood

c. What is the process of cross selling?

d. Cross selling and up selling is a win-win situation

e. Cross selling is to be tried only after the basic sale is done as per the following sales process model

f. Cross-selling model will always depend on the model of sales prevalent in an organisation. The following matrix may be referred for the same

g. Cross Selling is best done with a nurturing model

7. Negotiation Exchange Kit

It is often said in Sales that never give anything to anyone without taking something in return. This matrix, which envisages all that the customer normally, asks for and lists the corresponding asks by the salesman to the customer.
The logic behind preparing this kit is based on the mutual interest position of the two negotiating parties, as shown in the following diagram:

8. Customer Relationship Management (CRM)

a. What is the nature and scope of CRM?


b. What are the areas where the data collected in the CRM system will help?

9. Monetising Customer Life Time Value (CLV)

a. What is CLV?

The frequency of purchase, the average transaction value needs to be tracked along with the conscious effort to retain a customer for life to be able to monetize the CLV.

With more and more no of transactions, the cost of acquiring new business from same customer keeps on coming down. Organisations, which are able to have a high value of CLV per customers, also post a high degree of profitability and ROI.

The CEO of a company must be involved in this decision making as it is vital to the profitability of the organisation.

b. What are the categories of customers to be tracked specially?

10. Customer Loyalty Program

a. What are the objectives of a good customer loyalty program?

The RFM (Recency, Frequency, Monetary Value) tool is effectively used to arrive at these parameters by a CEO.

b. What are the advantages of a customer loyalty program?

The most important advantage is that the cost of acquiring a new customer is at least 10 times to serving an existing customer.

c. What are the options for constructing a customer loyalty program?

The Loyalty program are rolled out in either Point system, Discount system, Rebate system of Privilege card system.

This however is not an exhaustive list of options for loyalty programs.

d. What will make a customer continue to participate in a customer loyalty program?

e. The cycle of loyal customer and life time value is best understood by the following diagram

11. More Customer per Customer (MCPC)

The average basket size (ABS) will result in increment in MCPC. For doing this the stickiness of the customer for particular item codes has to be traced from historical data and then a conscious effort to be made to make more of MCPC by ensuring that more customers visit more categories of products or counters.

12. Sales Entropy in the system

Sales entropy refers to the degree of disorderliness in sales dept at a given point of time created by management to ensure that everyone is always on their toes. Complacency and enthalpy states are not very good for sales dept.
The SME CEO needs to understand, appreciate and implement this at least at the decision making level.

In a nutshell

The SME CEO must follow the following 4-way test to ensure that the sales dept runs smoothly.

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