Congratulations to SalesLoft on being named the Top Midsize Workplace in Atlanta. The sales enablement firm added 120 employees over the past year to 220 headcount. SalesLoft is looking to add another 150 employees in 2018.
“SalesLoft’s core values are like motivational mantras: Team over self, bias towards action, focus on results, put customers first and glass half full.
Atlanta Journal Constitution
CEO Kyle Porter has long stressed the value of transparency at SalesLoft with Sunday evening company-wide emails and Friday all-hands meetings where staff are encouraged to ask any question.
“What I’ve constantly heard is just massive amounts of appreciation for being kept in the loop,” he said.
The firm also emphasizes recognition, cross-team interactions, career development, and teamwork. Chessboards in the lobby foster friendly competition. “It shows that salespeople can have a scientific mind and that engineers can have a relational mind, and that’s really the exact thing that we do for our customers, is we bring the science and relationships together,” said Porter.
SalesLoft is holding its annual Rainmaker conference in Atlanta this week.
Salesforce announced another “beat and raise” quarter last week with strong revenue growth across all of its clouds and regions. Their Q4 earnings hit $2.85 billion, up 24% year-over-year (21% in constant currency). For the full year, revenues rose 25% (24% in constant currency) to $10.48 billion. SFDC has a three-year compound average growth rate (CAGR) of 25% with revenue nearly doubling over the period. Growth has been so rapid that their Q4 2018 revenue was more than their full FY 2014.
Salesforce claims it was the fastest enterprise software company to reach $10 billion in revenue and will be the fastest to hit $20 billion.
CEO Marc Benioff attributed ongoing growth to a number of factors including its sales team which drove a “blowout quarter,” lauding the “performance of that organization and their acuity.” Other factors included a growing set of CEO-level relationships, an “incredible increase in investment activity” fueled by the recent US corporate tax cuts, and digital transformation:
It doesn’t matter if they’re a consumer product goods company CEO or financial services or retail or any industry or any geography. Every CEO is thinking about their digital transformation. And I think you and I know that every digital transformation begins and ends with the customer.
This is very powerful. And it’s why we have so much activity in our company. Of course, we’re the number one customer company in the world. No other company in the history of the software industry has been as focused on customer-relationship management, but how companies can have a customer transformation at Salesforce.
And this, and this alone, focus, has accelerated our growth. You can see that in the numbers. So certainly, how we finished our year in fiscal year 2018 is not where we thought we would start. We raised guidance I think almost in each and every quarter, and yet we still ended up above that. And that’s why we’ve raised again here $150 million. This is the most we’ve ever raised in the history of the company, because we’re just ahead of where we thought we would be
So, we are, obviously $10 billion is now behind us, and $20 billion is ahead of us. And it’s our dream, we’re going to be the fastest to $20 billion.
But when you have $20 billion already on and off the balance sheet, you know that that is – we’re a huge step on the way there. So that’s what I couldn’t be more excited about the position the company is in, its competitiveness, its ability to perform, the quality of its customer relationships, the quality of the products, the integration of the acquisitions, the culture, Fortune number 1 best place to work. All of these things have come together in just a really beautiful way, and I’m extremely grateful.
Salesforce has several other factors fueling its growth: The annual Dreamforce event drew 170,000 attendees last year, the firm has a clear social mission that resonates well with millennial employees (and now decision makers), and it was an early mover into cloud computing, mobile-first design, IoT, partner ecosystems (AppExchange), and artificial intelligence.
Finally, being cloud only, the firm does not have to fight a rear-guard action to retain enterprise clients as they migrate to the cloud. So while SAP and Oracle must fight to retain their customer base as companies make the leap to the cloud, Salesforce is there to poach their new clients.
Sales and marketing often forget to focus on the unique value proposition they offer their customers. They focus on product features instead of customer benefits. There is an oft-repeated saying in marketing which captures this logic perfectly:
“People don’t buy quarter inch drills, they buy quarter inch holes.”
The electric drill was first developed by Black and Decker and patented in 1917 as a tool for their own production facility. Interestingly, the firm only recognized the value of the tool for consumers when employees began taking it home. Ironically, the tool often used to discuss the value of thinking broadly about use cases and customer needs was originally designed for a limited purpose, the Black and Decker plant, became an indispensable DIY consumer and industrial product.
A product/technology focus emphasizes the features of the drill and not the benefits of quickly making holes of specific sizes as needed, where needed. Marketers need to translate many product features to a distinct set of customer benefits and roll them into a unique value proposition that differentiates their product in the mind of potential customers.
Understanding the needs of the customers is also important for the product and engineering teams. Otherwise, they will view both the competition and the market too narrowly. If you are selling quarter inch drills, you view your competitors as quarter inch drill manufacturers. If you view your product as on demand tools for boring holes and attaching objects, you recognize a broader set of competitive and complementary products including bores, glues, solder, welding supplies, nails, screws, bolts, etc. You would also recognize that electromechanical torque can be applied to screws, bolts, and nuts, expanding your product line into adjacent markets.
Focusing on product features is also a bad practice for sales reps. As with marketing, emphasizing features prevents them from communicating the unique value proposition of your products and services. If your sales reps are too often complaining about losing on price or the need to constantly discount off list price, then either your prices are too high or your sales reps are engaged in too much feature-speak and failing to communicate customer benefits and value. Of course, these reasons are not mutually exclusive. You could have two root causes to your pricing difficulties – your prices may be too high and your sales reps may be failing to communicate value.
Another problem with focusing on features is it treats your product as little more than a commodity. A differentiated service is less subject to price erosion and heavy discounting. This is one reason I tell my clients in the sales intelligence space not to compete on database size. While there are benefits to larger databases, users aren’t usually purchasing big databases [feature], they are purchasing sales insights [value proposition] that make them more effective at building prospecting lists [benefit 1], qualifying leads [benefit 2], managing accounts [benefit 3], reducing CRM data entry [benefit 4], improving analytics , and selling deeper into organizations [benefit 6]. Thus, it isn’t the size of the company and executive files, but the breadth of data insights that help reps more efficiently and effectively sell.
So as you hold your 2018 sales kickoffs, make sure to communicate your new product’s value proposition to your salesforce. Likewise, evangelize your company’s vision during new hire training, product road mapping sessions, and all hands meetings. In the end, customers are interested in your value and how you benefit them, not RPM or database size.
Thinking back on the Hawaii emergency management snafu (a WWII acronym meaning “Situation Normal: All F****d up), it was clear that they lacked proper controls and situational planning. Apparently, there were no controls to prevent routine tests from sending out real messages. Furthermore, there was no redundancy in the system (e.g. confirmation messages, secondary approvals) and no plan for immediately recalling the message. Supposedly, the governor couldn’t Tweet because he forgot his password.
So, Hawaii was sent into a panic.
This just points out that emergency plans need to be periodically reviewed (what better time than Q1?). Do we have proper backups and system redundancy, state of the art firewalls and virus detection, and plans for managing and communicating hacks? Can we manage operations if a key partner API crashes or content partner shutters? Have we run through PR nightmare scenarios such as the one that H&M recently suffered (and which resulted in their South African stores being vandalized)?
There is no lack of risks (data security, physical security, financial, brand, supply chain, key executive health). Most are highly unlikely. But we’ve seen information services firms suffer problems over the past few years including the theft of the D&B NetProspex contact file from a data licensor and the Equifax hack. So, while many seem remote, the lack of scenario planning makes them more likely and costlier.
Of course, risk planning and mitigation need to be realistic. If it is simply a “Duck and Cover” campaign for PR purposes, then it will do little to prevent the risk or manage the situation should the emergency happen. Emergency planning needs to be robust.
Emergency planning suffers from some of the same issues as data quality. Both are boring investments based upon reduction of hypothetical risks and costs. But part of a C-level executive’s mandate is to plan for business continuity and mitigate risk.
Todd Berkowitz, Research Vice President at Gartner, sees Account Based Marketing (ABM) as increasing tensions between sales and marketing in the short-term. While ABM has long been advocated as a facilitator of departmental alignment, he sees ABM as disrupting sales processes and generating friction:
“Between ABM and adoption of various new technologies and data types, there is a lot of disruption that is happening with regards to sales teams. Even if these changes are going to be beneficial to tech companies in the medium-term, and some of the “A sellers” get on board quickly with the changes, there are many sales reps that will have to be dragged kicking and screaming into the new world. (This is why I always advise trying an ABM pilot with a select set of reps). So even if there is pretty good alignment and agreement between CMOs and sales leaders, don’t expect all reps to magically do what they are being asked to do. There needs to be an adjustment period, along with good sales enablement, before everyone plays nicely.”
So, while ABM will facilitate agreements in process, messaging, and metrics in the medium-term, it will generate resistance amongst sales reps unwilling to adopt new processes and tools or unconvinced of its value. This friction is probably exacerbated by predictions of sales force reductions due to the implementation of AI and other information and workflow technologies.
Resistance to technological change has long been an issue. Early in the Industrial Revolution, The Luddites sabotaged British plants, particularly cotton and wool mills. While sales reps are unlikely to sabotage initiatives (or their careers), they may hesitate to learn new platforms or adopt new processes. As such, the problem may be more akin to soldiering, the assembly line equivalent of reducing individual productivity to the level of the laggards on the line. Frederick Taylor, the father of time and motion studies, was very concerned about soldiering and recommended piece work rates to create productivity incentives. But sales reps are very attuned to incentives. While they may be hesitant to adopt new technologies, they will do so if they help make them more efficient and effective at selling. So long as sales reps are paid on a commission basis and long-term employment is tied to making quota, the level of soldiering should be minimal.
This isn’t to say that sales reps won’t resist learning new tools. If they believe the time invested in such training is less than the incremental revenue for the lost selling time spent in training, then they will avoid training and learning new tools. However, if they see others on their team benefiting from the new tools, they will not hold out long term. Thus, tool training needs to be visibly supported by management with an emphasis upon the benefits to sales reps (e.g. less time spent on non-sales tasks and more time interacting with customers and prospects, improved account intelligence, improved account targeting and message timing). With the proper incentives and information, resistance should be minimal.
To help ensure adoption, vendors should be looking to integrate solutions into CRMs, email, and mobile devices so that new tools are integrated into current workflows. They should also be providing inline tool tips, initial training focused on their capabilities which provide high levels of efficiency and efficacy improvements, tool-based win stories, and usage tools for tracking training, usage, and ROI. A few gamification elements may also be in order, but they should be organic to the product and not hokey.
Predictive Analytics and Audience Management vendor Leadspace completed its Series C. The funding round was led by Arrowroot Capital and joined by JVP. The $21 million round will be used “to grow our customer team in San Francisco and Denver, and our AI and data management product teams in Israel.”
The firm is assessing additional locations, including possible offices on the East Coast and Europe, “perhaps” London.
Arrowroot has taken a seat on Leadspace’s Board. The firm wanted growth equity advisors instead of traditional VCs for Round C. “At this point the investment is not just in the idea and the team, but also the underlying metrics and performance of the business,” said CEO Doug Bewsher. “Once you have “Product/Market fit”, the kinds of questions investors ask are whether you are ready to scale; what are the opportunities for further growth; and apart from additional investment can we be an investment partner that can help you address these opportunities?”
Bewsher noted that marketing has been transformed over the past seven years since Leadspace was founded. Firms are switching from tactical demand generation programs to targeted Account Based Marketing (ABM) communications. “No longer is it OK to just send out blanket “nurture” emails to everyone and hope that will generate positive customer engagements. No longer can you rely on a single data source as the basis to know your customer. No longer is it enough for marketers to just think of leads — they need to market to accounts, and teams of people. Neither can marketers afford to ignore intelligence and information from external parties, and simply rely on the limited info they gather internally.”
Not only has the nature of B2B marketing been transformed, but “world class B2B sales and marketing organizations” need to become more like consumer companies with a deep understanding of the account at multiple levels. Echoing Sirius Decisions, Bewsher said that B2B marketers need to “really know your customer at the account, demand unit and individual level, and then target and personalize your messaging to cut through the noise. And think customer-first.”
As an analytics company, Bewsher talks up the value of AI for sales and marketing as it begins to address specific problems and workflows:
AI is everywhere. While there is no doubt that it is going to change every corner of our life, both as private users and business people, I think we will start to move from the promise to the reality in 2018. In business-to-business sales and marketing in 2017, it was enough to say: “We have a ton of great data scientists who are working on new ways to better engage your customers.”
But in 2018 customers will look to see actual results — like the 90 percent increase in email connection rates we have seen from the deployment of AI to recommend the right way to engage a specific user. This will require a maniacal focus on specific use cases from the emerging area of AI.
One area where AI will improve revenue generation effectiveness is in ABM programs which has been limited by the human ability to consume information and the historical lack of data availability. However, “AI is changing all this, with the ability to consume and understand unprecedented amounts of information and turn this into action at scale and in real time. So sales and marketing teams now have the opportunity to drive much more relevant and effective engagement programs for their entire potential target audience.”
According to Leadspace, they are trusted by over 130 B2B brands and seven of the top ten enterprise software companies. Clients include Microsoft, Marketo, Oracle, and RingCentral.
I came across some excellent tips from Johnty Mongan, Managing Director of The Mongan Group concerning the new European sales environment post-GDPR. Selling in Europe will be trickier in May as reps need to obtain opt-in approval
Mongan provided the following advice:
GDPR is about protecting our interests from unlawful behaviour. GDPR removes the unwanted cold calls, email campaigns and any other processing that we haven’t agreed to. A transparent and fair existence for all. I really like it, it fits with my karmic views of the world.
It won’t how ever stop marketing activities through publicly available information, like a company email or a company number…
It’s time to go old school… here’s what you can do to reach new customers in a lawful and GDPR way:
Get consent from current customers to continue marketing to them. Do it in an engaging way. That’s a must.
Provide explicit consent of your intentions to all new prospects when luring them in with shiny content. For example, download this form so I can phone you. That’s a must.
Go to the events your customers go to, get over yourself and introduce yourself. That’s a must.
Hold your own events.
Get more business cards…. they are not as useless as you may think.
Offer referral schemes to current customers. You should do that anyway.
Market your services within ethical channels. Where you customers go, you go
My list goes on, but it all centres around building clear authentic relationships. This is a good thing because most “sales” are won on the back of authenticity and trust. I see leading the charge with GDPR compliant sales processes a fantastic way to demonstrate your intentions.
So basically, what’s old is new again. While marketing needs to be particularly attuned to GDPR, sales reps also need obtain permission.