Take Networking to the next level

Vish Kokkonda writes that Networking Is a Waste Of Time. He states that much networking is a waste but it’s not if “you are willing to work at building solid professional relationships.” Absolutely. I’ve written about networking practices, expectations, and objectives for 10 years at MyLinkWiki. Hundreds of other social media gurus have said the same.

This is easier said than done.  How can we look at the networking challenge in a way that brings insight and more importantly results. How can good networkers become even better?

Let me share a few thoughts.

Much networking is weak.

I refer to the kind that doesn’t generate results that Vish was talking about and which encompasses both the networking activity and the nature of the person-to-person connection. This includes:

• Open online networking
• Networking events where the primary activity is drinking
• Connections where there is little communication after the initial interaction

This isn’t your granddaddy’s or even your daddy’s business world.

Today’s technologies have fundamentally changed how we relate and communicate. Before the Internet, executives averaged 150 connections. These were strong personal relationships. Services like LinkedIn now enable networks with thousands, or tens of thousands, of contacts. While the network is much larger, it’s also far more diffuse and difficult to engage. You have permission to contact these connections (sometimes). But that doesn’t change the fact that they barely know you. As a result we vastly overestimate the value of the large network.

It’s just like the Sales funnel

Sales, just like networking, is all about the depth of a relationship. A strong networking connection, comparable to a qualified lead ready to buy at the bottom of the funnel, enables you to reach your objective, whether it’s finding  prospects for your business or a new job. A weak networking connection is at the other end, at the top of the sales funnel. Expecting a weak network to help you is like expecting to close cold calls. It rarely happens.

Building the relationship is just as critical as creating it.

In sales one qualified lead is worth 100 or even 1,000 prospects. That logarithmic value is similar to networking. Yet people spend only a tiny fraction of their networking time, energy, and money in building their relationships.

One Solution is the Un-Cold Call.

Yes, it’s that time of the program for a short commercial pitch. At Revenue Typhoon we applied the Pay It Forward approach of networking to the beginning of the sales process. It’s not longer a cold call. It’s an Un-Cold Call, which effectively moves your prospects down the sales funnel so they’re more receptive to a call or meeting.

The same happens in reverse. In the Networking Un-Cold Call we apply similar marketing automation and sales techniques to effectively build your relationship with your connections. The result – you can have a large network AND expect it to be more responsive to your requests.

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Sales Scalability for repeatable, reliable, and rising revenues

The startup mantra is scalability.  Build your product and IP.  Leverage it for high growth that attracts investors.  Repeat for the next funding level and continue until you exit.

Tech scalability is well known.   Code is the ultimate example of reusing a resource at virtually no cost.

Sales scalability though is still a mystery.  Marketing and sales are a custom, personnel-intensive, and thus costly part of company operations.

But that doesn’t have to be the case.

In Scaling Sales: From Craft to Machine Jeff Bussgang writes about successful sales models.  Sales teams though are just a part of sales and marketing process.

Here is how you engineer  a complete solution.

1. Avoid sucky marketing.  Scalability happens with accelerating returns, not the linear marketing like advertising that Wilson warned against.

2. Understand customer sales psychology. A typical product sale is actually a series of customer buying decisions. This Point of Decision approach requires separate marketing and sales processes with appropriate offers.

3. Manage the entire funnel.  Every step of the marketing and sales process needs to be optimized from prospecting to lead gen to lead nurturing to sales conversion to repeat or upsales.

4. Employ a marketing system.  Just like the tech investment in reusable code, a marketing investment in Point of Decision automated campaigns for direct or rep-closed sales features a low recurring cost.  Incremental sales have a much lower allocated marketing and sales cost that hikes margins and accelerates profitability.

This is what we do at Revenue Typhoon and Power CMO.

Startup Revenues: The Final Frontier

Good old fashioned revenues are making a comeback of sorts, not that they ever went out of fashion.

I earlier wrote that Traction is Job 1.  Ash Fontana’s presentation is getting a lot of press these days. Sales often are more important than product or team as a factor in VC evaluation.  It’s certainly critical in reducing risk.

At BAE Investments & Workshop we see a wide range of startups from concepts to  those seeking several million dollars in funding.  You don’t have to have revenues.  Our program helps plug holes like that.  But there is no denying that traction is and has always been important.

Indeed revenues are becoming currency in deals.  The Next Stage of Angel Investing: Revenue-based Funding from the Texas Entrepreneur Network highlights revenue sharing as an emerging vehicle for startup funding. Typical deals have a 3 to 5% revenue share that’s capped at a 3 to 5X return. It’s venture capital meets factoring.

The run to cash is a natural economic response to the changing capital markets. Demand has increased with the rise of self-funded and angel startups, while later stage money continues to tighten with diminished IPO and VC markets and low returns.  It’s why many angels today have moved to real estate deals.

If you’re an entrepreneur, the question is how well are you positioned for revenues?  If you wait until you start looking for VC money, you’re too late.

The tech culture today is tightly focused on product, as it should be.  As I noted in Exponential marketing VC Fred Wilson proclaimed “Marketing is for companies who have sucky products.”

But it’s becoming increasing clear that revenues are just as important.  A revenue strategy needs to be designed and executed earlier rather than later in your startup’s development. That’s exactly what we do at Power CMO where we work with both investors protecting their investments and entrepreneurs.  We couple innovative revenue-focused marketing strategy with a marketing system for regular, reliable, and scalable revenues. Give us a call at (972) 200-3490 to see what we can do for you.

Take credit cards?

Credit card terminals have been around for decades and are even wireless to serve retail sales.  But unless you have a physical store or lots of transactions, a terminal and those merchant agreements can be expensive and bulky.  It’s overkill  when you already have a powerful computer in your handy smartphone.

One alternative is to use a laptop or phone browser and manually enter sales on PayPal or your bank site.  But that’s a lot of info to type and your rate is higher.

Startup Square successfully shook up the market with iPhone and Android apps, plugin card reader, and terms that any small business could love.  The reader is free and there are no transaction and monthly fees.  Now you CAN take credit cards even if it’s just for a few charges a month.

Gopayment is now competitive.  They’ve removed fees and work with a Blackberry, which Square doesn’t.

• Intuit Gopayment
• Square
• Verifone

Get more links at our BlueEntrepreneurs.com eCommerce directory.

Demand generation for the rest of us

The Revenue Typhoon is a way to reliably and consistently generate revenues through demand generation. But is it for for everyone?

An entrepreneur wrote “Marc, that sounds great … if you’re IBM or have funding. I’m a small company. I don’t have the money or people to engineer a pipeline or hire you to create it. Now what? Where’s MY Typhoon? Or am I destined for a few measly sprinkles.”

IBM, wow. That’s dating yourself, my friend.

If you’re a self-employed professional or small company, you don’t have to wander aimlessly in the desert, hoping you’ll run into an oasis. You’re not Moses.

Demand Generation is a philosophy, one that can be practiced even if you don’t have the resources to create a mean, lean, revenue machine.

Technology, knowledge, and process are key ingredients of the Revenue Typhoon and demand generation.

Technology is the core of demand generation. A personal CRM system like WeMeUs stores your contacts and provides a platform for generating and following up leads so you can track the entire demand generation cycle.

Next, build a database that is a complete accounting of your marketing and sales efforts. What programs did you run, what markets did they reach, what metrics were used, how many leads were generated, how many were qualified, how many resulted in sales, and so on.

If you have staff, advisors or consultants, share and update this data so everyone can contribute and see your objectives and progress.

Process starts with a commitment to be knowledge-driven where possible and not dependent on the experience, whims, or dartboard tosses of your top marketing executive, CEO, or his uncle Sal. Marketing and sales activities are judged by relevant business metrics. Each program starts with a plan that includes metrics and then is regularly monitored, compared with other programs, and increased, modified, continued, or canceled.

Plan, execute, measure, learn, and repeat. That’s it!  That process turns your raw data into knowledge as you see what works, what doesn’t, and what has the best ROI.

While you may not have your own full-time demand generation guru, you absolutely can do it yourself. Through this practice, you will constantly improve your ability to generate leads and convert them into sales.

You CAN Win: Lead generation and sales for Small Businesses

Marketing Sherpa published the chart below on sales conversion.  What’s stunning is that 50% of companies have NO processes or system in place.  That’s an opportunity for smaller organizations.

How Organizations Manage Their Marketing-to-Sales Process

While a customized Salesforce application and IT staff may be out of your reach, you can still effectively manage your sales pipeline and compete against the bigger boys with the right product. I recommend WeMeUS Relationship Management and Lead Generation for Consultants and Small Businesses.  WeMeUs is a personal CRM with full Lead Management for lead nurturing and tracking. Read more on WeMeUs for Sales

Know Your Customers IV: Lead nurturing

Lead nurturing is the culmination of this past month’s example of the Revenue Typhoon. By aligning and integrating marketing and sales you’ll be able to powerfully and predictably generate revenues.

The process to this point has been composed of the following:

1. The development of a Target customer.
2. Segmentation that meaningfully divides your prospects so you can tailor your marketing to them.
3. Lifecycle marketing for timely communications based on sales and product status.
4. A personal CRM tool like WeMeUs with contact management, tags, groups, lead forms, and highly personalized email.

Lead nurturing combines the data from Segmentation and processes from Lifecycle marketing to generate the highest level of personalized communications. It enables you to deliver the information your leads want when they need it. Establish you or your company as a leader, improve your credibility, and remove sales objections. It all leads to your bottom line as nurturing qualifies the lead and moves the prospect down the sales funnel.

Lead nurturing is a warm way to make use of the various marketing and support collaterals and programs you’ve developed, run across, or obtained, including your industry, application, and product web pages, news, help, research, demos, executive briefings, seminars, webinars, case studies, articles, blogs, video, social media, testimonials, free trials, executive access, and immediate sales and technical support.

Know Your Customers III: Lifecycle marketing

Lifecycle marketing is an effective program to reach current contacts and customers for repeat and referral business. It’s a special case of segmentation because it’s one you have direct knowledge of – the prospect and customer’s exposure to your product and the sales process.

Lifecycle marketing is strongest where there are clear and immediate signs of purchase intent, such as clicking an ad or filling a shopping cart. But it also applies in the B2B world for self-employed professionals and small businesses.

Your customer message depends on where they are in the lifecycle. Here are a few examples.

• After initial lead acquisition, send educational information and offers to help that reinforce your messaging, unique selling proposition, value, and special product features. Stage this over time or use an autoresponder to maintain an ongoing relationship during this crucial time.
• After initial use, such as first login, ask if there are questions or for immediate feedback.
• After different levels of use or different features are first used, send appropriate tips.
• After a positive transaction, such as a referral or purchase, send a thank you.
• Before an important service or billing date, such as subscription renewal or lapse, remind the user of your service value and upcoming transaction.
• Before an important date, such as service or use anniversary, send a personal email to show your appreciation.
• After a customer demonstrates that they’re one of your top customers, such as through usage, level of purchase, community support, or other engagement, send a loyalty email that shows your appreciation and recognition and turns them into an evangelist.
• When customers become inactive or at-risk, re-engage them to learn what happened and how you can recover their business.

TOOL TIP – WeMeUs contact management and lead generation is a personal CRM (Customer Relationship Management). WeMeUs both reminds you to stay in touch with top contacts and tracks the status of all your sales opportunities from initial contact through discussion and engagement. Use tags to further track customer segments and affiliation.

Printing Money – The Revenue Typhoon

At Tribe Blue and our on-on-one consulting we teach that building your business is a process. Strategize, plan, execute, measure, and reload. Generating revenues is the same.

Sales consultants like to talk about the funnel. A bushel of leads enters the funnel. The leads are winnowed after qualification and prosecution until only a few exit the funnel as actual sales.

But the focus on a funnel is short-sighted. Let’s say you’re the guy in charge of sales. Your goal is 10 sales this quarter. You’re damn good and know that you can close 20% of qualified leads. Marketing generates 50 leads. So you’re set, right? No. That’s a separate funnel. If 20% of gross leads are qualified, you can only expect 10 qualified leads and to close 20% of that, or 2 sales.  Marketing actually needs to generate 250 leads for you to make quota.  Uh-oh!

Tactical funnels don’t exist in isolation. There are a series of operational marketing and sales funnels that encompass and qualify markets, prospects, leads, and accounts. Indeed there is one huge funnel that stretches from mass markets of tens of millions of business or consumers to the individual customers that trickle out the other end.

When you build a manufacturing plant, you don’t just engineer one machine. You design the entire layout, including machines and production line, from raw materials to finished product.

It’s the same in marketing and sales. Each step in the master funnel must be managed to ensure maximum sales. We call it the Revenue Typhoon because it’s the secret to printing money.