Not long ago, the sales representative was the main source of information about your company’s products and services.  The sales rep would succeed through a focus on deep product knowledge and personal relationships. 

This doesn’t work anymore.  The economic crisis has heightened competition and the need to demonstrate measurable value.  But more profoundly, the emergence of social media has produced new sources of information about a company.  In addition to vast amounts of comparative data about products and services on the Internet, social websites allow customers to gain insights from their trusted peers.   Customers are often more knowledgeable than their sales rep and certainly well-armed for any discussion.  Based on input from engaging in an online community, their minds may be largely made up before the sales call. 

The upshot is that sales reps must be better prepared for the more limited time they do have in front of customers.  Preparation means knowing the value of the product to the specific customer – not just functions and technology.  That implies a clear understanding of the customer’s business and ability to communicate in a way that resonates with the customer – using the language of business value.    In the past, a sales rep might take a shotgun approach – presenting five to ten different offers to the customer – and hoping one will win.   Now, the rep must be able to present one or two offers – precisely fitting requirements because the offers are derived from insights into the customer’s needs. This will make the decision easier for the customer, save everyone time, and will help the rep gain the customer’s trust.

So given the shift to communities of knowledgeable customers and value-based selling, what should companies do?    The first steps are time-honored but now more important than ever: Look at your overall strategy, know your target customer base, and align your sales force with your company’s goals for profitable growth.  Make sure you’re selling the right product mix into the right markets – and to the right customers.  As there is limited time for your sales reps to spend with your customers, make sure you know which customers are more profitable and which are consuming time but low on return.  In short, align your sales force so that strategy translates into execution: Be certain that there are professional sales reps on sales calls who are promoting products and services in a way that supports your immediate- and long-term goals.

Another consideration:  Ensure that the right rep is assigned to a particular customer.  While you should encourage all reps to increase their focus on value-based selling, your reps have varying strengths – some have good technical knowledge, some are empathetic, some are problem-solvers, some are great communicators over a beer.  Make sure you understand your customers and match the blend of soft, technical, and value-based skills when allocating your reps.  Encouraging an open culture helps:  A rep should be able to go back to his boss and ask for a reassignment if there’s a mismatch. 

The forces for change in the business world – social media, knowledgeable customers (who are less inclined to remain loyal), relentless competition – present opportunities for new ways for a company to manage its sales force.  For example, just as customers can better understand their product options, the sales force can use social networks (such as LinkedIn) to gain accurate and up-to-date insights into their customer contacts and leverage their network to get in touch with key people.  And with a professional sales force that understands ROI, there are opportunities to move well beyond buy/sell transactions to collaboration with customers in order to create shared value.  This is even happening in sales environments that are traditionally transaction-oriented: Retailers are now working with their consumer goods suppliers to extend product categories, delivering better growth and margin for both end-consumer and supplier. 

These changes in sales practices will be disruptive for many.  Still, there is enormous potential for companies that embrace the changes with a re-oriented sales force and revamped business models, placing these firms on an even better trajectory for profitable growth.

Author: Dietmar Bohn is Vice President Solution Management at SAP AG. He runs SAP’s Solution Management for the Line of Business Sales. Dietmar brings more than 10 years of CRM experience from both outside and inside SAP and more than 20 years of industry experience. Dietmar has held different management roles spanning CRM strategy projects, CRM implementation projects, CRM development and CRM product management.