Sales Enablement: The Good, the Bad and the Ugly for 2013

According to a recent study by IDC’s  Sales Advisory, the majority of sales reps are not able to effectively engage with today’s more empowered, skeptical and frugal buyer.

Michael Gerard, VP of IDC ‘s CMO and Sales Advisory Practice indicates in a recent presentation that it now takes more than 650 targets just to get one deal, and each deal is taking longer to close than before, some 19 months for the marketing and sales cycle to complete.

This is a good news / bad news story from IDC.

The Good News:

It’s not just the vendors that are frustrated by a lengthening decision process. Buyers indicate they too would like to reduce the time it takes to arrive at a purchase decision, by some 25%.  

The Bad News:

Although buyer’s admit their own internal processes are more complex than ever, they attribute a hefty 36% of the decision delays to the vendor’s sales process – the inability for solution providers to deliver the right resources and content at the right time to help facilitate the buyer’s decision-making process.

The Good News:

Much of the long decision cycle and poor close ratio could be reduced with better sales enablement – delivering the right in the right format and in the right time / place to move a specific sales opportunity forward.

The Bad News:

Most companies are not getting Sales Enablement right, and this is costly. For a typical $1B firm, a lack of good Sales Enablement is resulting in:

• $14M of wasted sales and marketing expenses, generating leads that are not effectively engaged, or investing in tools and content that are not used or not effective,
• $100M of lost revenue opportunities, some 10% of total annual revenue.

The Good News:

Buyers indicate that content is vital to their decision making process and still highly valued. The solution provider who delivers the right content and the right stage in the buyer’s journey can overcome most of these sales enablement issues.

So what is the most valued content when making a key purchase decision? It’s not Product Information (17%), Product Demos (17%), Reviews and Test Results (13%), Peer /Customer References (7%), Industry Trends (6%) or even Competitive Comparisons (5%).

The most valued content is “ROI / Financial Justification” by a wide margin, indicated as the top decision support content by 28% of respondents; More than double or triple the value of most other content marketing.

And effectively delivering ROI / Financial Justification content and tools has a tangible impact, according to IDC’s business value consulting practice, helping to kick start 5% of stalled pipelines to close, reducing sales cycles by 10%, reducing discounting by 30% and improving competitive win rates by up to 60%.

ROI / Financial Justification content is now highly in demand, with CFOs and Finance large and in charge – more deeply engaged throughout the decision making process, and certainly wielding more power over approvals. These stakeholders demand financial scrutiny and require ROI / Financial Justification in order to grant approval. In fact, Randy Perry, VP of IDC’s Business Value Practice, indicates that more than 90% of deals require a financial business case in order to garner approval.

And the justification is not just isolated to the quants. There are now 40% more stakeholders involved in each purchase decision compared to just three years ago, growing from 5 to 7 for the average purchase decision. Each of these stakeholders has a unique set of challenges, and subsequently, a unique perspective on the value that can be achieved from proposed solutions. Unfortunately two out of three struggle to justify what’s in it for them without vendor help.

The Bad News:

So how long does it take for a sales rep to find the ROI / Financial Justification information customers so desperately need to make a purchase decision?

Unfortunately, IDC indicates that ROI related assets take almost 3 days (2.8) on average to find and deliver, with 1 in 4 indicated it could take weeks to produce.

If ROI is the most important content for making decisions, why is it so difficult for sales to find and deliver this content to eager buyers?

Analyzing marketing and sales enablement spending, most organizations significantly underinvest in the ROI / financial justification content and tools that today’s buyer demand, and that could make sales professionals more productive and effective – delivering what buyers value most in making purchase decisions from weeks to minutes. And when the ROI / Financial Justification is made available to sales, it is often not able to be used quickly to produce the personalized and relevant content buyer's need.

The Bottom-Line

Sales enablement is key to get sales professionals effective at engaging with today’s more empowered, skeptical and frugal buyer. Yet most organizations are not properly enabling sales to engage in this tough environment where Frugalnomics reigns.

The right content and tools can help, but organizations are not getting this “right”, resulting in 12% squandered marketing and sales enablement investments, and a significant 10% lost revenue opportunity impact

ROI / Financial Justification is now the most valued content / sales enablement tools to help support purchase decision making, however most organizations are not investing enough in this area, and not delivering the role-based value messaging and quantification today’s multi-stakeholder decisions demand.

To investigate further:

• IDC’s Sales Advisory research
• An overview of Frugalnomics and how to “fight” back
• An overview of ROI / Financial Justification-focused tools