Here's the next chapter of the ebook by Rob Symes. Enjoy the read and come back for the last chapter next week.
“Most salespeople don’t
give you orders, they give you bar bills.”
Paul Johnson, Serial
entrepreneur
My first experience of sales was trying to sell a
pen. Not just any pen but a crap biro. It was hard. Eighteen years of
education, a posh private school and a lifetime of competitive sport hadn’t
prepared me for the sheer difficulty of persuading someone to part with their
money. My interviewer wasn’t particularly impressed and I didn’t get the job.
But the experience left a lasting impression that a sale was very very hard.
Selling technology is even harder. Customers haven’t heard of your product and
if they’ve heard of it they often don’t understand it.
Hiring star salespeople is
a universal problem for technology companies. Good salespeople are difficult to
find, harder to hire and a track record at one firm does not translate to
success at the next. Most participants of this E-book mentioned varying degrees
of difficulty in hiring salespeople that actually did what they were hired for:
Sell. One CEO, when describing his salespeople, squeezed his paper cup so hard
in frustration that water exploded on his trousers.
Sales are where the rubber should meet the
road for tech companies. But as Richard Leaver, CEO of Blue Star Capital, quips
“techies think ‘If we build it they will come. If they don’t they’re idiots’.”
Unfortunately, however good your product, at some point you have to sell it.
Which means, if you’re not going to sell it yourself, you’re going to hire a
salesperson. And even established technology companies have difficulty doing
this effectively.
Therefore, I
was interested to hear if a former Autonomy executive had any answers to
permanent conundrum of hiring “five-to-one” salespeople.
Chandratillake’s
story is a technology reporter’s dream. Born in Sri Lanka before moving to the
UK and studying at Cambridge, he set up the American office for Autonomy’s CEO,
Mike Lynch, before spinning out a team of twenty to form Blinkx in 2001.
Blinkx’s revenues grew by 73% in 2012 to 114 million dollars.
What makes
Chandratillake engaging is not just his story but also his capacity to analyse
it. I’m a question machine, it’s my job, but he needs very little prompting
explaining the obstacles Blinkx has overcome.
As Blinkx left
the Autonomy mothership Chandratillake knew they had to create their own
identity. Lynch wasn’t going anywhere, in fact Chandraktillake called him every
day for the first six months, but in the words of Autonomy’s CEO they had to
create their “own terrorist cell.” Being obsessive, even evangelical, came easily
to the start up team. Failure did not. Their first product was a bust.
Consumers didn’t care. Just changing from suits to jeans wasn’t going to help
them understand the consumer market overnight.
However, Blinkx
persisted and soon had created the beginnings of the video search product that
has been the bedrock of the company’s success. However, even as Blinkx’s
product gained traction Chandratillake began to notice some his salesforce were
not as successful as he had hoped. It was not that underperformers lacked
diligence or motivation. It was a fundamental flaw in their approach.
Not unusually
for a tech start up, Blinkx was selling a new product into an untested market.
Sometimes it was difficult to see who the potential market could be and even
when they identified content providers like NBC as potential customers there
were still difficulties. Over time, Chandratillake saw that traditional
salespeople were ill equipped to sell disruptive products. The reason for this
is simple to grasp but difficult to implement.
Let’s look at
two types of salespeople in 2010: A pen salesman and a salesman selling Wi-Fi
into pubs.
The pen
salesman knows who he sells to: Retailers. He knows what quantity of pens his
customers bought last month. Two characteristics determine his success:
personal charisma and the price of his pens. When he engaged with a new
customer it was usually once the customer had decided they needed to buy pens.
Therefore, he asked questions, negotiated a price and then either succeeded or
failed. Simple.
The Wi-Fi salesman’s job was far harder. In
boom and bust, for hundreds of years, pubs had been a simple, profitable
business. But the pub trade was changing in part because of the smoking ban and
the recession. And while the pub landlord had Wi-Fi at home he’d never thought
of putting it into his pubs. The salesman’s job in this case was not to try to
flog a Wi-Fi connection based on his charisma and the product’s price. The
salesman’s job was to educate the landlord about the disruptive trends
happening in the pub market: Less Blue-collar workers, more families and a
younger, on-the-go generation who wanted nonstop access to their smartphone and
weren’t content with pints alone. Pubs were losing their old day-in-day-out
blue- collar workers but not gaining the new generation. Once the salesman had
explained the disruptive insights happening in the pub industry he could
position his product as a solution. The Wi-Fi product would increase footfall
of the younger generation, they would stay longer and buy more because of that
and revenues would increase accordingly.
Unfortunately,
the technology industry has been hiring too many pen salesmen. To combat this,
Chandratillake’s solution was to “assess salespeople like engineers.” He gave them
case studies or logic tests to see how their mind worked. The salespeople were
rarely as good as engineers but it gave him an idea if they could spot and
explain disruptive trends. Chandratillake knew that his customers, like the pub
landlords, often didn’t know what their problem was and therefore would have
little idea how to solve it. He therefore needed salespeople who could educate
and develop insights based on his video search product and the market
surrounding it.
When hiring salespeople
technology companies must assess the right characteristics. The pen salesman is
dead. Long live the engineer.
