Sales Research - a profitable Call Centre Project.
Just when Call Centre Managers are looking for ways to make the transitions from a cost centre to a profit center Ron La Vine introduces the new discipline of Sales Research, which seems tailor made for Call Centres. Judge for yourself.
This is the introduction in Ron La Vine's new book, which he has allowed us to preview.
Downsizing, A Blessing In Disguise For Me
By Ron La Vine (copyright IntellWorks 1996, all rights reserved)
Late in 1994, just before the holidays, after five years of service as the Director of Sales Research at a Fortune 1000 company, I was "terminated." Along with 250 other employees, I received a form letter explaining, "Inevitably, when two large organizations combine, certain areas become redundant or no longer justifiable." Although "sales research", had found millions and millions of dollars for this company they considered my staff position "redundant or no longer justifiable." Little did either of us know then, but over the next two years, three of my former employer's sixteen divisions would contract with my new company, The IntellWorks, to conduct sales research. This meant that The IntellWorks was hired to go through and clean up customer databases (addresses and contacts), and uncover hidden business opportunities, a new twist on sales research. To begin our examination of sales research, let's differentiate the client as someone who hires us as opposed to the prospect or customer who does business with the client.
What is Sales Research?
What is sales research and how does it differ from marketing research?
Sales research is geared towards finding certain data which is required to make additional sales to a company's existing customers. A Sales Research Specialist is someone who has the expertise to find, evaluate, analyze, organize and package suspect, prospect and customer data into useful intelligence a sales force can act on -- immediately. Sales research enables salespeople to do what they do best, which is selling, instead of spending their time trying to find who is looking to buy. The process of sales research can also have other benefits over and above generating sales - such as reducing costs. For example, the identification of contact name and address changes reduces a company's sales and marketing communications costs -- by eliminating phone calls and mailings to contacts who are no longer employed or who have changed positions. The real key is to sales research however, is to ascertain the accuracy of existing data, gather some new data and then convert it into intelligence which a company (our client) can use to increase sales. For instance, this data might include when a prospect or customer plans to buy another (or related) product or service offered by the client. Another example is the identification of an upcoming significant change in a prospect or customer's business, creating a need for additional products or services.
Prospecting For Gold By now some of you are saying to yourselves, this sounds a lot like prospecting. Sales research is a lot like prospecting, but it takes prospecting to a new level by finding specific data and converting it into actionable intelligence. By using the telephone interview, sales researchers are able to unearth a wealth of valuable data about prospects and customers. Here's an analogy: sales research can be liken to a prospector who finds the gold for the client's goldminers (salespeople) to mine. Other opportunities to be considered by a sales researcher include customer needs for additional products, services, training, education or documentation. Sales research examines where an individual prospect or customer is now, where they want to be and how they plan to get there.
Marketing Sales Research Services Can Be Tricky
First, to become a sales researcher, one must enjoy working on the phone. Second, one must be able to market oneself in such a way that potential clients believe you can produce results. Finally, one must be able to produce some actionable results. In my opinion, this kind of sales research is a new concept. It requires educating (and convincing) potential clients about the benefits of having a research specialist go through their proprietary prospect or customer database to find hidden business opportunities their sales employees may have overlooked. Credibility and confidentiality are essential prerequisites for this type of work and signing a non-disclosure agreement is standard procedure before starting any project. After negotiating the terms and conditions for a sales research services agreement, a custom questionnaire is created for each client based upon their specific business requirements. The IntellWorks places a $1,000 value upon this service and usually offers it free in return for the client's agreement to a pilot project. Based on past experience, I know that once a client tries The IntellWorks' service, they will soon wonder how they ever got along without it.
The Pilot Project To get a foot in the door of a potential client, The IntellWorks frequently offers a 30 day, No Results-No Fee-No Risk SM trial or pilot project. If the client cannot convert the intelligence The IntellWorks produces into sales within one year (the amount of time will vary with each client), than they owe me nothing but my expenses. This procedure allows me to test my client's ability to 1) act upon the opportunities I have found; and 2) their ability to pay for The IntellWorks' services. The client receives a well-documented report containing new intelligence about a sample of their prospect or customer base detailing where business opportunities might or can be found.
During a pilot project, The IntellWorks asks for 1% to 15% (depending on the selling price of the product or service) of the total gross sales generated by the intelligence work. Statistically, our experience has shown that hidden business opportunities exist within 10% to 30% of a client's existing customer base. When The IntellWorks completes ten surveys, we expect to find one to three legitimate business opportunities. In the meantime the client receives the value-added service of having their database cleaned and updated.
When selling The IntellWorks' services, I quickly point out, that salespeople usually receive a higher commission on news sales, rather than on sales to existing customers. Yet, it is a well-known fact, the cost of acquiring a new customer can be up to 20 times more than reactivating an existing customer. So why do companies seek new customers? Maybe it's because companies prefer to try to increase market share and so place all (or most) of their sales and marketing emphasis on attracting new business rather than making new sales to existing customers.
Again, my experience has been that clients often have hundreds of existing customers that rarely receive a phone call to see how they are doing and if they could use additional company products or services. These hidden business opportunities have amounted to millions of dollars in additional sales for my clients.
For some enlightened companies the customer service trend is changing. Tom Trainer, VP of Information Technology and Chief Information Officer for Eli Lilly and Company, wrote: "Getting closer to customers is priority for many companies today. They recognize that close contact is vital to not only keep customers happy in the short term, but to get feedback that keeps future products, services and strategy ahead of the competition-and in tune with customer needs."[Tom Trainer, VP of IT and CIO for Eli Lilly and Co., Listening to Your Customers, INFORMATIONWEEK, (September 18, 1995) Page 236]
Information Professionals Are Well Trained for Sales Research
With the right training and experience, an expert sales researcher can earn into the six figures by charging anywhere from $25 to $100 for each survey completed plus a percentage of the sales opportunities generated. Good sales research professionals who have developed excellent listening skills, the ability to learn about a client's products and services quickly, and who possess the ability to collect useful sales intelligence about the client's prospects and customers, are the best people to assist the client with hidden opportunity identification.
David R. Bender, Executive Director of the Special Libraries Association, sums it up well: "...how many people have the expertise to evaluate, analyze, organize and package raw data-transforming it into meaningful information that can be put to work?" He goes on to say "...not many, and the explanation is quite simple." As management expert Peter Drucker wrote in a column for the Wall Street Journal, "There is a big difference between being computer literate and information literate." Bender writes, "Drucker explained that for data to become useful information, it must be organized for a task or applied to a decision." He contended, however, "Few people are adept at determining exactly what information they need to do their jobs, when they need the information, and where they can get it." [David R. Bender, The Information Highway: Will Librarians Be Left by the side of the Road?, COMPETITIVE INTELLIGENCE REVIEW, Volume 6(2), John Wiley & Sons, Inc. (1995), Page 39.]
A good sales research professional knows what data is needed, where it can be found and how to get it and provide it in a manner that can enable clients to increase their sales. In my case, The IntellWorks generated over $2.7 million dollars for its clients last year, so I guess you could say downsizing has been a real blessing in disguise for me.
About the Author...
Ron La Vine, President of The IntellWorks - Sales Research Specialists, has worked in the sales research industry for eight years and is a member of the Society of Competitive Intelligence Professionals (SCIP). He can be reached at (USA) 1-800-975-1724, 818-716-5030 or by Email at firstname.lastname@example.org. Homepage www.intellworks.com .
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