Inside Sales the Salesforce.com Way.
This post distills 10 years of experience working for salesforce into as few words as possible. It was the basis for a 45 minute webinar on the same topic.
•Hiring for inside sales •Deciding territories •Lead generation & management •Qualifying for volume and value •Discovering problems
•Establishing value and beating competitors •Managing trials •Selling by references •Establishing real closing events •How to forecast and manage pipeline
It is a lot to cover so is confined to a short piece on each aspect. We are very happy to engage directly with you if you would like more detail or insight for your organisation.
A note on the author and PipelineCheck.
Fiachra Ó Comhraí worked at salesforce.com for 10 years. He sold to hundreds of sales leaders, listening to their goals, challenges and strategies and hopes for how CRM might help them execute those strategies. He was promoted to VP EMEA Sales after 5 years. He founded PipelineCheck to make sales people better. PipelineCheck is a member of the American Association of Inside Sales Professionals and the Inside Sales Directors Network and the Sales Institute in Ireland.
PipelineCheck is famous for two things:
This converts sales effort, as recorded in the CRM system, into points. This effort is compared to the effect it is having on revenue for each opportunity, sales rep, team and region. This helps reps to understand their performance and managers to coach more effectively.
This encourages better forecasting by measuring the accuracy of sales forecasts at the opportunity level. Reps get confidence chips and stake these on opportunities. They win chips back based on the accuracy of their prediction for the opportunities based on close date and value.
Reps see how they stack up in terms of forecasting and manage the key opportunity fields (value, close date and probability) more closely themselves so pipeline is honest. The company can be more confident in forecasting and therefore grow faster.
Hiring for inside sales
The first priority is to hire superstars. The most important thing is to have the right environment that attracts and retains superstars. It is not just a simple thing of paying people a lot.
The interview process conveys a lot about a company to candidates and their friends. Sales people talk to their friends about the companies they are working for, the career prospects they have, commission and even interviews.
We had a HR person do a first interview, a hiring manager do a second interview about their CV, experience, etc
The third step was role based. The candidate would be given a case study and asked to come back and present to a panel in a role play as if they were selling for salesforce.com.
They would do a slide show and a product demonstration — signing up for a trial and customising it to the case study. It was not a product knowledge test. It was a test to see how well they addressed the case study requirements.
Hiring managers would play different roles e.g. head of sales, finance, IT and ask questions in role play.
At the start candidates are instructed not to break role play. If they don’t know the answer they should handle it as they would with a real prospect. If there is a negotiation they should handle it as if they were the CEO of salesforce.com.
Salesforce.com paid very well. This was not just on average. It paid particularly well for top performers. Top performers could have a win rate twice that of the worst — easily — and they were paid multiples of the worst performers. This encouraged top performers to stay. Average reps knew what the top performers were earning and worked hard to improve.
Potential candidates were told what top performers had earned the previous year so they knew what was achievable.
The lines between inside sales and field sales was continually increased to give inside sales more — as it proved it could deliver in bigger segments. This meant inside sales reps could see more potential in their role and that enterprise sales concentrated on working bigger accounts and going after really big deals.
A crucial aspect of hiring good salespeople into inside sales is that they are not sharing a territory with a field counterpart. They own and run opportunities on accounts from beginning to end and if they can grow that within their accounts they keep it.
Lastly, promotion from within helped hire and retain top sales people. There was clear promotion prospects to higher segments or to management roles as inside sales expanded. This is especially important where there is a secret sauce for selling or implementing the product. It takes time to learn the secrets and time to be promoted.
In the early days we didn’t always get territories right. There was a tendency of leaving reps with their existing accounts or good territories but as salesforce.com scaled it was vital to have fair territories.
It takes too long to ramp new sales people if they don’t have a good territory. They need deal flow to learn how to sell.
We mixed new and existing accounts for sales people. Territories were scored in terms of license count, historical revenue which could be higher than license count depending on the products sold, number of accounts and number of opportunities.
The weighting on these elements was changed from time to time but the intention was always to have fair territories. Once territories were cut the reps were given the accounts in their territory and left with them for a year.
A “Stay in lane” policy meant that there would be no account disputes after the list was made and implemented in salesforce.com (whether between reps or between enterprise and inside sales). This reduced time disputing ownership of accounts or opportunities after someone had done a lot of work on them.
Lead generation & management
Air superiority was provided by Marc Benioff as CEO. This was in the form of getting attention for the company — often by knocking the gorilla in the room e.g. Siebel then Oracle and Microsoft or even all software with the slogan “software is dead”. Media attention was responsible for a huge number of leads.
There was division between inbound and outbound teams for lead qualification and marketing. Inbound tended to work leads for inside sales — qualifying people who signed up for a trial or downloaded a white paper. Outbound teams worked larger accounts for enterprise teams.
There was always a division between sales and the teams qualifying leads/generating opportunities. This division went to the highest levels in salesforce.com and was important.
If someone on the lead team wasn’t passing enough leads through or they weren’t being accepted (qualified) by the sales team it would show up as a problem to their manager. If on the other hand the sales person/team receiving these leads was not accepting as many as other salespeople that could show up as a problem to the lead team or sales team manager.
Qualifying for volume and value
We used different globally recognised sales methodologies — Value selling, Sandler Selling, Barry Rhein — and ones homegrown over time in salesforce.com. We always used the same methodology across the organisation — inside sales or field sales teams. This gave a common language to understanding opportunities and what was needed to close them.
So how do you apply the same methodology to a business with 5 employees versus 500,000 employees ?
The key is that you have to look at the effort worth putting into the buying process by the potential customer and guide them through the evaluation process based on that. Luckily in small companies sales reps could be dealing with the CEO or head of sales who might also be an owner of the business. People at this level could articulate the goals and challenges for the business quickly. In a company with 1,000s of employees it could take months to establish a consensus around problems/solutions — if there was one.
If an opportunity was going on too long for an inside sales opportunity we would look at the history in salesforce.com and say that to the decision maker — “You have been evaluating for 3 months now for 2 users, I know that you have this goal of X and identified these problems 1,2 & 3 which we can help address but you need to make a decision so we can get on with it. Remember you are not trying to select the perfect system you are trying to select the best one to address these problems you identified as urgent/important”.
The process of qualifying opportunities is dynamic. It is not based on fixed information for all time i.e. budget and decision maker. Salesforce used these types of fields to qualify from time to time but the question of what makes an opportunity is related to what a sales person is willing to work.
In emerging markets we might have had one sales rep with too many opportunities and the lead team would qualify much hard and nurture leads for longer so that the salesperson could work on bigger, more focused opportunities.
In mature markets that might have 50–100 reps working them and reps would want an opportunity as soon as the company and contact were identified as real.
The truest test of an opportunity being qualified is if a rep is working it. A potential purchaser might say that they have no budget this year, are at an early stage and reviewing for next year — for a small deal maybe only a task would be created to give them a follow up call in 6 months. This is not an opportunity. If was a big deal the sales rep would be willing to put a campaign in place for that opportunity — nurturing the relationship, educating, inviting to events, sending relevant case studies etc.
Opportunities are only opportunities if they are being worked.
This is essentially a phone based skill for inside sales. It is a very skilled process to do good discovery over the phone or to do a web based demonstration where you can’t see the people you are talking to.
Inside sales reps still have to establish rapport. Personality, humour and affinity are critical to making these conversations successful. Buyers need to understand that you are a real person and that you are listening to them.
This is done by making sure you know the names of everyone on the call and recognise the voices. If someone asks a question and you don’t know who they are you ask: “I’m sorry who said that ?”. You need to know their role and if the same person or other people return to that point as the conversation progresses.
Every three sentences you should refer back to something they have said — making clear you have listened and that you are making the solution relevant to them.
The advantage that a field person has when they call to a premises is they can start qualifying an opportunity when they are looking at the building or reading the materials in reception or by the people they see going in and out.
Inside sales managers get good at sizing up an opportunity or likely objections by looking at prospect’s website. Inside sales people have to ask more about the company because they can’t make assumptions based on the building or the cars they see parked outside. Get the background for the company and the people you are selling to — quickly on a call because it is less likely to come out in the casual conversations a field salesperson might have over time on a big opportunity.
Like all business to business sales, it is important to know the business and personal goals of the people you are selling to. It can be hard to get people to open up about personal goals over the phone. It is hard but it is hard in person too. Field sales people hope to find out more about the personal side by being in more social settings with potential buyers. Inside sales people have to be better at getting people to open up quickly. The best inside people do this with humour and by revealing a little about themselves — it could be “today is my birthday, I’m hoping you are in a good mood too!”. We had a rep who went sky diving and put the video on youtube and shared it with prospects he was getting on with. Whatever it is, it should be sensitive to the personality of the person you are selling to and it should be authenticate. Don’t say it is your birthday if it is not. People can tell a lie and even if they can’t the person telling the lie is chipping away a little bit of their integrity every time they say it. It eventually leaves a mess.
What are the alternatives that the prospect has tried ? Braver sales people (who are good at their jobs) will ask this one. It doesn’t mean that the sales person jumps all over the alternative saying why it would never have worked. The salesperson asks them why it hasn’t worked. This might seem like a slower, field based type conversation but it is not. My experience was that invariably the CFO or someone on the buyer side would still be advocating this other option and it would stall a sale.
Good sales people don’t necessarily ask about the other options they are currently considering because if they are not serious about other competitors they might feel they have to throw some names out and then start looking. Salesforce.com eventually got to the stage where often it was the only solution people were seriously considering. Despite this, it lost a lot of deals to “no decision”. This was because the sales rep didn’t explore the other things that were tried in the past nor understand the reasons they failed or if even if they had failed.
The last thing on discovery is that often an inside salesperson is selling to one person or maybe one main person and a few influencers. There is a tendency to ignore the rest of the people in the company but it is really important to assess the views of the people not involved in the process. Is there consensus about the goal of the business, the project, the problems and the alternatives ? None of this should be neglected in discovery for inside sales.
Establishing value and beating competitors
There are a lot of very bad sales people out there. There are a lot of very limited products out there. Salesforce was very limited in the early days. It was unclear to the people within salesforce if it could every scale to millions of users on a single instance or cope with the demands of international enterprises. That seems are to believe now but there was a time when we celebrated getting a customer with 50 users.
The way we differentiated against much larger competitors and much more functionally rich solutions was to address the value that potential customers were trying to achieve for their businesses. We didn’t pretend to be a functionally rich as solutions the CRM systems that had been around a long time. We knew what we were good at — time to deploy — and we found a way to relate that to something the customers were hoping to achieve quickly.
We always tried to understand the goal in specific financial terms — not a percentage improvement but a currency amount — so that we could relate the value of our solution to that and fend off comparisons to competitors costs by comparing our time-to-value for the customer versus competitors. We could be live in hours when they took weeks or months. We could express this time as an opportunity cost to their business.
This was critical to overcoming competitors including the toughest of them all i.e. inertia or doing nothing.
Always be wary if a potential customer says your solution is the most sophisticated or starts comparing it to high end cards. This almost always is heading towards a dead opportunity. Most people don’t buy Farraris or Rolls Royce. It is a sure sign that a competitor is doing a better job of relating their solution to the requirement that you are.
Focus on what you can do for your customer. This will leave most competitors in the side lane.
If you have to talk about a competitor then leave it as a one liner. Functionality or pricing differences very rarely last. We had a team of people on a competitive analysis team that compared salesforce.com to critical high end and low end competitors. If they said the competition didn’t do something or competitors said we didn’t then that became a priority to fix and soon went away as a differentiator. Pricing differences call always be fixed with a pen — if the difference doesn’t represent anything of true value to a customer.
The strongest one liners are emotional expressions of something you genuinely believe is a lasting quality of a competitor. We felt some competitors just wanted to drain customers of money and others just didn’t work. We didn’t dwell on it and encouraged the customer to do their own research on that particular aspect of concern. Prospective customers could find evidence of massive overspending or functionality problems with a google search . Why get into a long negative conversation about a competitor when you could be learning more about the customer and matching your product to value for them?
In salesforce.com we found that invariably people never used the 30 day trial until the last day or two and they would request a trial extension. Trials are guaranteed ways to delay a sales cycle. Is a trial actually needed ? Big companies very rarely but time into them or used them to assess solutions. They recognise that without having made a decision they will not commit the resources or leadership time to making key decisions for an implementation. So why do small companies think that it is worth investing time in a trial ?
If a small company is going to spend time in a trial, does it have a clear goal for the trial and clear things it is trying to test ? Are people committed to testing those things? Is their time? Who owns the success. Is the decision going to come down to the ease of setting things up in a trial?
We found that often the focus on a trial reflected distrust of a sales person, usually caused by being burned by a salesperson with a decision they made before — for a different solution. Software sales people could make anyone cynical. Trust is a hard to win back even for a different company. The people who had been through torture as part of an implementation of a competitive product were the hardest to convince that salesforce.com was easy and worth switching too. They were locked in based on the problems with the solution they picked — an ironic form of customer retention. It was a sort of Stockholm syndrome. I often found myself trying to be a psychotherapist for these people to understand the underlying cause of their obsession with a trial.
The best bargain to make with these prospects as an inside sales person: “tell me what you want to test, I’ll tell you the truth. If you don’t believe me, I’ll set it up in a demonstration environment and let you have access to it. If you still don’t believe me after that, then go ahead and have a 30 day trial but keep in mind that I’ve had extensive training and know the product well so you will spend a lot of time trying to figure things out in a product that you have not decided if you will be using”. I was always happy to show them how I set it up if they had concerns about how easy it would be for them to do.
Selling by references
The opposite of trial based decisions came with people who wanted to put no time into a decision and just skip to references. Salesforce.com was not as well known then as it is now so people would ask: who else is using it? Can I talk to them ? I would always push back on these requests — even when we had a lot of customers. Why ? No two customers have the same business processes and the same functional requirements. Reference customers can’t be used to educate prospective customers at the start of a sales cycle. Inexperienced sales people tend to jump at the chance of skipping qualification, discovery, presenting a solution and negotiating. Why bother when another customer can get them over the line? Salesforce.com had and has some of the happiest customers in the software world but despite the legend, they were not our best sales people. Our best sales people were our best salespeople. Customers were our most important lead source — they referred other potential customers but they didn’t close them — they didn’t do discovery, they didn’t identify the specific value of products to the potential customer.
If we had someone who thought that a conversation with another customer would make up their mind, we would say — “I will happily set up any number of references you want once we understand your needs and if our solution matches them. Just because we are right for one company — even a direct competitor does not mean we are right for you. Tell me about your business and what makes it different.”
Establishing real closing events
The myth of sales is that there are some closing events that have a specific date and nothing short of the earth plummeting out of the milky-way would stop a decision. In 20 years, I have never seen a deadline that could not be moved back or a decision delayed — even where the incumbent solution was SaaS based and they said they would cut off access at the end of a contract if they didn’t get renewal paperwork before then. Invariably the customer will request an extension if they are not ready to make a decision. The software vendor will see it as an extra month of revenue that they will not be getting otherwise or if they are real pigs they will threaten to cut the customer off and the customer will either stay with them for another year or come up with some other interim solution.
You don’t need to have a specific date by which a decision must be made at all costs. You need to understand the opportunity cost of the potential customer not using your solution. My favourite line after being told three or four times “we are not ready to start looking yet, call us again next month” was: “we have been calling you every few weeks now for 3 months. We don’t want to waste your time or ours. What is your revenue, approximately ? …. Well, see on average our customers report an X% increase in revenue so in the three months that we haven’t been at the top of your priority list, we could potentially have earned you X% more revenue in those months. If we leave it another month, that will cost you $Y. If we call you again next month, will you talk to us then ?”
How to forecast and manage pipeline
When you are looking at implementing a CRM system or managing sales pipeline, you have to start with: what do the reps need to know. Most reps don’t initially like putting information into a CRM system. It is only when they’ve been doing it properly for a while that they appreciate the benefits. Try asking about the details of a meeting they had yesterday or a month ago or a year ago. Look at the opportunities they lost a year ago and ask them to recall important information about it that would help them re-open it. Ask them how they would feel if they were given territory and related pipeline from another rep and had to sell based on the information in the CRM system. Reps then begin to understand what a manager is looking for when they review an opportunity or sales pipeline as a whole.
Good managers who do that for a while get to know their reps. This builds up an instinct for what is going to close or not. Managers often have a better instinct for it that the reps. Experienced managers can get on a call and know within minutes what a sales rep hasn’t sensed in months of dealing with someone i.e. that they are not going to buy or that they have a lot more money to spend.
Forecasting is built up from reps being honest about their opportunities and being conscientious about updating the values and close dates. This is hard in an inside sales environment. There can be a lot of volume — a lot of movement. It has to be done with each material interaction on a deal. Reps need to ask after a call ends, or they get a response to an email or even after a series of non-responses: “does this affect the time or value or probability of this deal?” and then they need to update that in the CRM system. Even if the answer will disappoint or heighten expectations for their manager.
An amazing amount of managers’ time is spent in cat and mouse games around forecasting. Reps aren’t that concerned with getting it right. Reps care about how they are doing against their target. Managers tend to be the ones who care about forecasts. Reps need to understand how important forecasting is for decision makers and growing the business.
Managers also need to ensure that all deals are in the CRM system and that opportunities are qualified if they are being worked. How else can win rates be measured ? Reps won’t have a problem putting a qualified opportunity in the system the week or month it is going to close but what about earlier in the sales cycle. Is that being measured ? Is it in the CRM system? Is the value right ? Is the timeframe reasonable ?
Often we found the worst reps had the highest win rates because they didn’t qualify opportunities until the paperwork was certain or they left a very low value or opportunities never died. They potential customer always deferred a decision — sometimes even if the interim decision was to sign a multi-year subscription with a competitor.
Inside sales managers cannot properly assess a rep without accurate win rates and without accurate deal sizes. Managers cannot rely on a gut feeling that pipeline is being wasted on a rep if there wasn’t evidence to support it. Managers cannot support reps if they data in the CRM isn’t giving a fair picture of what is going on.
Reps cannot manage their own pipeline if they are not maintaining this core information in the CRM system. Poor reps often want to hide this information from managers so things don’t look as bad. First they hide the problem by having inflated future pipeline. If the pipeline is culled they will argue it is a territory problem.
Always start with getting accurate close dates, values and probability based on the reps best guess at this stage in the sales cycle.
The reps who do this will manage their own pipeline because they can prioritise tasks based on real deals, real value and real close dates. Managers can start to review activity levels and the quality of activity once they have an accurate view of pipeline.
And of course, in my day we didn’t have PipelineCheck to help make sure opportunity values, close and probabilities were accurate.
We would like to help you to improve forecasting accuracy and to make your sales reps better. If you found this helpful, please get in touch and let us know what challenges you have currently.