You Can't Bend Your Target Market's Buying Process to Your Quarterly Earnings Reports

I got hired into a company that I fondly refer to as BS…S or "Bill Statement in the Sky." They sell SaaS solutions to the utility and government marketplace.

Prior to getting hired there, they'd been in the business for years. I assumed they had a solid understanding of their target market.

But, even if you think a company knows something, it's always smart to ask a few questions during the interviews (5 of them), to make sure they say the quiet parts out loud.

In this case, I felt it was important that they acknowledge the quirks that come with selling to government organizations. These groups are exceptionally risk-averse and slow moving. Almost none of the sales strategies you read about in popular sales books, work with this market.

I asked, "What's the average sales cycle?"

They said, "12-24 months."

I thought, great, they understand that government buyers move at a snail's pace.

I asked, "What are some of the habits of your most successful reps?"

They said, "They follow our proven sales process. They learn the product quickly. They're persistent. They play the long game because our sales cycle takes months. They do their own outbound prospecting, but we have a strong Sales Development Rep team who will feed you leads."

I thought, cool, follow their process. It must be good one because they appear to be successful. Be persistent = can do.

Learn their product. Hey, you use it to pay your utility bill online. Simple enough.

Source my own leads but there's a team to help. Never had that before but sounds nice.

I asked, "When a regional sales director did struggle, what were some of the reasons?"

They said, "Most of our reps make quota. If they haven't sold to government before, however, sometimes the longer sales cycle and the red tape they have to navigate to finalize a deal is a bit of a hurdle. Government procurement rules can be challenging but we provide experienced sales coaching to help."

I thought, alright, alright, alright. I've been selling to government for years. Those issues won't be show-stoppers for me.

I asked, "What's my territory?"

They said, "Texas."

I thought, even better. I've been working in that state for the last 5 years.

Fast forward, one year.

BS…S, "Hey, were filing for an Initial Public Offering (IPO). We're going public. Going to be traded on the New York Stock Exchange.

Everything is going to be great! We're going to get all this new money to invest in our products. We're going to make them better, faster, and more compelling.

We’re going to beef up our implementation team so we can setup all those new accounts you guys/gals are closing, even faster. This change is going to be really amazing for employees."

6 months later.

BS…S, "Hey, we really need you guys and gals to bring these deals along faster. We're going to have weekly one-on-ones so you can work with your experienced sales manager (who never sold much of anything) and gameplan on specific actions to take.

We need to create a sense of urgency. Find those pain points. Dig into them. Magnify them so those government workers feel compelled to buy sooner.

Umm, we've also revamped the discovery process. All sales staff need to recertify by doing mock discovery calls for your sales managers and the VP of Sales. This will ensure we're all on the same page. This is a really good thing.

Oh, and our Quarterly Business Reviews (QBRs), they're really critical now. Make sure your forecast is super accurate and come prepared to defend those deals. In fact, make a presentation, and fill out a MEDDIC analysis of the top 3-5 deals in your pipe.

Yes, I know you kept the notes and completed the questions in Salesforce, but it would just take us too much time to read all that info in the CRM.

We want you to tell us verbally, again and again, what you've spent the last 6-12 months noting in SF. It's always better talking about it isn't it?

Oh yeah, and it looks like we're changing your territory. But don't worry, there's plenty of business opportunities in this new area (even thought the company has historically sold nothing).

6 months after that, "Look sales team, we really have to execute. While we're up for the whole year, we missed our forecast in Q3. You know Bobby-baby our CEO doesn't like to bring bad news to those analysts on the quarterly earnings call. He didn't say it, but we can tell he's really pissed."

Me, wondering to myself silently, what happened in the last year and a half.

Me wondering so often that I felt compelled to ask a few questions.

Me during our 20-person sales call, "Hey sales managers and VP of Sales, what happened to the 12-24 mo. sales cycle? When we went public, did our target market change their buying patterns?

BS...S sales managers and VP of sales, almost in unison, "Let's take this offline."

It's great if you're a public company and have to report "to the Street" every 3 mos. It's great if your stock responds positively to the news.

And if you report revenue and profit increases, and your stock value still drops, hang in there company leaders, show a little confidence.

But don't come back to your sales team and think that because you have to report quarterly sales data, that your target market all of a sudden started caring about what's important to your firm.

Don’t think that you can bend the sales cycle to the artificial construct that is public company reporting every 3 months.

This will be painfully obvious to the clear thinkers but an average sales cycle of 12-24 months means that it's most likely that your will close the majority of all your deals over a 12 to 24 month period.

There's no 3-month exclusion principle in there!