Sales strategy - the key to great and lasting success

One of the most important discoveries I made while preparing materials for my #theforgottenartofsales project is that old greats like IBM, Xerox and Honeywell used a distinct strategic approach to managing and executing sales efforts. This information is not readily available and you may not find any mention of it unless you systematically study old memoirs and scholarly articles or subscribe to my newsletter.

In modern publications on sales strategy, you can learn a lot about tactical skills and tricks, but very little, if anything, about strategy. “Strategy" has become a meaningless buzzword these days, often confused with the words "tactics" or "important". Everything is strategic: meetings, presentations, evaluations, campaigns, accounting. And yet, according to research, 80-90% of companies operate without a strategy that is put into action. No wonder, because a viable strategy is often not easy to formulate and even more difficult to implement.

You can not have a viable sales strategy without aligning it with the corporate strategy. But, truth be told, you can be successful in sales without a strategy. And you can be successful for a long time, especially if your team has strong tactical skills, the sales cycle is short and highly repeatable, and the market is stable and predictable. The true benefits of a sales strategy become apparent when the sales cycle is long and complicated and the market is disturbed. The more competitive the market, the greater the demand for a strategy. According to research, 70-80% of successful companies today have a solid strategy.

How did they do it in the past?

It is very difficult, if not impossible, to find out details about the current sales strategies of the top companies. But we can learn a lot from the history of sales. It was in the 1960s when the importance of corporate strategy was first discovered. But in the 1960s it was mainly about business portfolio and diversification. In the 1980s, researchers discovered that companies needed to link the strategy of the company to the activities of the sales force. It was proven that if the strategies developed at the top of the corporate hierarchy were "decoupled" from sales activities, a decline in sales revenue and a loss of the company's competitive position could be expected. Some of the most advanced companies at the time, such as IBM, Xerox and Honeywell, reacted quickly and developed a sales strategy linked to the corporate strategy.

At that time, sales strategies were based on the "sales behavior analysis model". The term "behaviorism" was coined in 1912 by Professor John Broadus Watson, who defined it as a purely objective, experimental branch of natural science aimed at the prediction and control of behavior. Watson's work aroused the interest of business executives who wanted to influence the decisions of their customers. He later worked for the advertising agency J. Walter Thompson and used his psychological knowledge to develop successful campaigns. For example, he convinced American mothers to use baby powder with every diaper change for Johnson & Johnson and popularized the "coffee break" for Maxwell House.

Watson's theory had a lasting impact on the business world and changed its view of customers. This perspective, rooted in behaviorism, relied on positive and negative reinforcement to influence consumer behavior. Behaviorism quickly gained traction in the United States as advertising agencies believed they could use psychological methods to mass produce consumers. However, this approach was criticized for ignoring mental processes. From the 1960s onwards, cognitive psychology began to replace behaviorism, although it remains highly influential in the business world due to its practicality.

Customer behavior-centric approach

The author is not aware if the model of sales behavior analysis is still in use. Let’s hope it is not, because some aspects of practical behaviorism are not exactly ethical. Nevertheless, the attempt to understand customer behavior has enabled companies like IBM, Xerox, Honeywell and others to create a new sales paradigm that focuses on understanding customer behavior rather than traditional sales processes.

Strategy is about management of resources and the most important resource of any business is its customers, so customers and their needs should be at the heart of any successful sales strategy. This is even more true in today's market where customers have more information and options than ever before. A sales strategy should also include a plan for building and maintaining close customer relationships, as well as strategies for upselling and cross-selling to existing customers.

Today, 40 years later, there are still companies trying to develop a sales strategy based on their sales process. While a defined sales process is important, it cannot be the backbone of the strategy. It must be based on customer behavior, needs and wants. This means that you need to understand the customer's problems, wishes and preferences and adapt the sales approach accordingly.

The sales force as a strategic resource

You can't make anyone like you or your products and services. You need sales professionals who are able to not only influence customers, but also build and maintain long-term relationships. This is another important and difficult to replace resource to consider when formulating your strategy.

The primitive view of the role of sales is mainly to make a quick buck by selling the company's products and services to anyone who wants to buy them. However, if you view your salespeople as a valuable strategic resource, then the role of a salesperson goes beyond simply offering products and services. They need to know their customers' industry inside and out, take responsibility for their customers' productivity, represent them in their own company and maintain the customer relationship. Viewing salespeople as key assets of the company allows salespeople to take center stage and evolve from simple order takers to relationship managers as companies offer increasingly complex products and services in a highly competitive environment.

More material on this and other topics will be available in my forthcoming book "The Forgotten Art of Selling". Contact me to receive the early version of the book.