Selling in downturn

Carpedia Consulting (Pty) Ltd – www.carpedia.co.za – Selling in Downturn

Selling in a Downturn

Werner Hess

What if you

were to decide

that a downturn

in the economy

is in fact a great

opportunity to

grow market

share?


Introduction Newcomers to the sales environment may perceive the sales

Most companies entering a period of slow growth or recession run for cover. In other

words, they make sure that they batten down the hatches and restrict cost intensive

activities as far as possible. This also impacts how they run sales. Companies tend to

downsize the sales force based on the argument that sales are bound to take a knock during

the recession. All sounds good and logical. However, what if you were to take different

approach? What if you were to decide that a recessionary period is in fact a good time to

shift market share; a good time to expand contacts and a good time to redefine value in the

face of what difficulties most companies will face in a downturn? Companies that make a

firm decision to use the opportunity presented by the environment may want to follow a

process to make sure that they can optimise what they do during the downturn, to

capitalize on the opportunities that may still be out there.


Review current revenue streams

Do a thorough analysis of the past period’s revenue stream composition in terms of;

1. New business (Acquisition)

2. Cross Selling ( Penetration)

3. Keeping existing revenue streams flowing ( Retention)

4. New product introductions (NPI)

An analysis may reveal shifts in your revenue generation patterns that

may just expose opportunities you weren’t expecting to be there. The

opportunities defined as acquisition, may present itself when

competitors are struggling to stay afloat in the current market. A quick

analysis of competitors and their relative positions in the market may

throw out some opportunities that you may want to target in the event

of a competitor cutting service levels or going out of business.

Cross selling always presents opportunities. With the sales team

perhaps now entering a phase of relatively low activity levels, the

opportunities for cross selling and selling more product to existing

customers may deliver better results than when the sales funnels are in

full swing and all the focus is on new business.

It may also be the right time to revisit the new product introduction

pipeline to evaluate whether there are opportunities to introduce more

productive products and solutions (less input for more output) to the

market. The market may show its readiness for your specific

productivity focused solutions, in a market where cost and performance

are paramount.

Finally, you need to build walls around your current customer base, to make sure that

someone else hasn’t read this article and goes on the prowl for new business within your

customer base. Customer retention is paramount in a downturn.

A Revenue

Stream

analysis may

lead to some

unexpected

opportunities


Refocus on segmentation

It a good idea to sit down with your sales teams and analyse the current market segments

that you are operating in and whether there are market segments that could be attractive

to you in a downturn scenario. Think of those segments that were out of reach because of

brand and image preferences, where now in a tight economy, companies may be looking for

better value. Many segments may be downsizing and this presents opportunities for

differentiated products. Re-visit your market segments served and identify segments that

may now be more attractive to you, given the economic climate.

Refocus on and re-evaluate needs segments

As a result of the downturn, your existing segments may also provide new opportunities for

a different approach and tailored offerings. Make sure that when you redefine needs in

particular segments that you re-think the entire segment. What will companies in specific

segments be doing differently in a down turn? What new needs sets may arise as a result of

the poor economy? How could we define the needs and tailor offerings that are aligned

with the newly discovered needs sets?

Review

segmentation

in line with the

current

economy


Re-Define Targets based on newly defined needs

When you have been able to isolate sets of newly defined needs, how will your market

targeting change? Will there be additional companies that you should be

talking to in regard to newly defined needs? You need to re-define your

target market (target customers) and go out into the market to validate the

possible new needs structures emerging. New companies that you will be

talking to automatically become new prospects. New prospects will open

new opportunities.

Re-focus your value propositions

Value in a growing economy is defined differently to when times are tough.

People are looking for different, higher value, higher productivity solutions that will help

them survive the slowdown. Once you have defined new offerings, make sure that your

value propositions are re-aligned and that they address the issues of the day. This may even

apply to existing business, where you want to be seen as being responsive to customer

needs.

You may

surprise

yourself…

Having

defined

new

targets

based on

newly

defined

needs sets,

you may

revise

targets

UPWARDS!


Re-activate Opportunities

While sifting through the data base of potentially new

opportunities, make sure that you also identify past

opportunities and past contacts that never

materialised in any business and revisit the reasons

for loosing those deals. The lost opportunities (if you

maintained the contact) are still “open doors” and

you may want to make use of the opportunity of

paying those contacts a visit to re-evaluate

opportunities within that base. Entry should be easy,

as you already have the contacts.

It’s a great time

to re-visit some

of your old

connections

Trawl your data

base for some

new

opportunities

within older

contacts


Re-define value

In good times, companies strive to do business within a certain value range. Many

companies would place a “deal-size” qualifier in place to qualify potential new deals, in

order to maximize sales in a buoyant market. In a down economy, you may want to revisit

all the limits that you have set-up from a value point of view and enable your sales people to

go after more, perhaps smaller deals, to keep the deal flow positive.

Re-think your sales strategy

Most companies in the current down-economy will be re-jigging their sales force

deployment numbers and re-evaluate marginal territories. While this is something that you

need to do as well, you may also want to consider beefing up your sales force and enter

opportunities that were unattractive in the past. Re-thinking your go to market model, your

competitive landscape and your competitive position may open up doors that were shut in

the past.

Re-energise your sales force

Sales people very quickly fall into the “economic downturn” trap and they start believing

that sales will suffer. They can talk themselves into a downward spiral. Truth is sales people

who are out there taking more of the less that is available in the market place really

succeeded against all odds. Your sales team should be in predatory mode, looking for and

chasing down new opportunities, while your competitors waste their time lamenting the

negative state of affairs


Re-cover lost ground

Part of your evaluation should be to look out for areas where you have lost ground to

competitors in the past. This often happens when companies are successful and they don’t

really notice that that are losing ground in specific geographic areas or within certain

product categories or with specific customers. What you need to be doing is to brain storm

lost ground with your sales teams and decide whether you need to up your activities in

areas where you have lost out to competitors.

Re-engineer your sales process

With a recession at hand, buying patterns and buying behaviours would change to suit the

mood of the economy. Make sure that your sales process mirrors the reality and seeks out

opportunities in new and innovative ways. You may have to adjust the amount of empathy

you use to find common ground or you may need to be much more consultative in terms of

understanding needs, opportunities and value perceptions. Also make sure that you use


plenty of early warning systems (cancellation red flags – opportunity spotting – reduction

requests etc) so that you can react and renegotiate, rather than loose the business.

Finally….

A downturn in economic activity should bring out the best in your sales teams. Sales people

are at the ready to try new ideas and approaches and companies should turn adversity into

opportunity! It’s a winning strategy in a down economy!


About Carpedia Consulting…

Carpedia Consulting is an internationally relevant management consultancy firm, dedicated

to assisting clients to improve sales and profits through the implementation of improvement

programs. Our approach is what makes us unique. The way we design, develop and execute

our programs is hands-on, solutions-based and excellence driven.

Our programs are customized to the needs of your organisation and are designed to ensure

significant and sustainable improvements are made both internally and externally – by the

sales team, for the customer.

www.carpedia.co.za

About Werner Hess…

Werner Hess has spent 20 years of his career in various sales, marketing and leadership

positions with Bayer, Triad Electronics, GE and GE Plastics before serving as managing

director of GE Plastics and Polymerland. Werner’s first experience in the world of consulting

came about when he joined Proudfoot Consulting as Director of Business Development,

which included several international assignments in Europe and the USA, leading sales

effectiveness projects for global clients. Werner’s current company, Carpedia Consulting is

a specialist niche consultancy focused on sales and profit improvement.

Werner’s latest book, The Science of Selling has just been published and reveals

approaches, systems and processes that can be implemented to create a successful sales

platform.

Werner can be reached on: [email protected]


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Email: [email protected]

www.carpedia.co.za