Market Focus - taking the proposition to market
Market Focus - taking the proposition to market
Identifying the optimum routes to your market and ensuring you have the right mix of routes for your proposition and target market is an important part of business planning.
Routes to Market – how do you get there?
The route(s) that you choose need to be right for your proposition and your target market. It is important that you set goals and targets for the amount of business you want, and can reasonably expect from each route, that you create a plan around achieving those targets, and that you have a driven process which actually achieves the targets.
Viewed from a high level, you have two main options when deciding which routes to use; direct and indirect. You also need to consider whether business opportunities will come to you inbound or whether you need to take an action, an outbound action, to hunt for those opportunities. To some extent, the decisions will make themselves, as each type of product or service will tend towards a “preferred” or at least, more obvious approach.
Indirect:
If you are trying to sell something that costs a few pounds then inbound and indirect are the only economic options to consider. Perhaps the most common example is retailing, where the manufacturer is responsible for some of the promotional activities e.g. TV advertising, but the retailer (channel) does most of the work in making the products readily available to the potential buyer and also usually becomes the main interface between buyer and manufacturer for delivery, warranty, service and complaints.
Elsewhere in the business to business world the split of responsibilities covers an entire spectrum. At one end, the channel may be responsible for all selling and promotional activities while at the other end of the spectrum they may be responsible only for distribution or just providing you with leads to follow up. Regardless of where you want the relationship to reside across this spectrum, you and your channel partners must put in the work at the beginning of the relationship to define the mutual expectations for that relationship if it is to be successful. Once defined, achievement against those expectations must be measured and monitored on a regular basis.
Direct:
If you are selling a complex high value proposition with a sales cycle measured in months then the only way to achieve controlled success is through a direct outbound model as the selling process will involve you in presenting your solution and more importantly convincing the prospect as to the value of buying from you. The classic application of the direct model would involve you in employing your own sales team. The sales team will have two main roles; selling new business (“hunting”) and growing and expanding existing customers for repeat business (“farming”). The people doing the hunting and farming may be responsible for prospecting for new customers and new opportunities or this may be done by a dedicated team, which can be employed in-house or bought as a service from a specialist supplier (“outsourced”).
The selling activity may be done by a field sales team, a telephone based sales team or a mix of the two. The choice depends on a number of factors such as; the cost of your product, the typical order size, complexity and length of the selling cycle. If what you sell costs a few pounds and the typical order is for a few items, then you probably cannot justify a field sales team. If you are selling high value products and services where an order can be in tens or hundreds of thousands of pounds, then you will need a field sales team.
The sales team may be made up of qualified professional sales people. Alternatively, the selling activities may be the responsibility of the consultants, engineers, accountants, lawyers, etc, who will be engaged with the customer for the purpose of delivering your services once a sale has been made. It is common that such people fear selling and as a result do it badly and typically in an ad hoc manner unless given additional support.
Tips:
* Choose the best mix of routes to take your proposition to your chosen market.
* Ask yourself, “Why am I using the indirect route to market?” and ”Is the indirect route the correct choice for me or, am I simply abdicating the responsibility because the direct route is too hard?”.
* Regardless of the routes that you use, ensure that the responsibility for; prospecting, closing new business and extending business with existing customers is owned by someone and that it is measured and monitored regularly.
* Observe the approach of your competitors. What routes do they use and what do their customers think? Can you improve on the service given by competitors?
* Ensure you and your products are important to your channel partners. If they do not care whether they sell for you then they won’t – they must feel some pain if they fail to achieve the targets you have agreed with them.
* Select partners/channels where there is mutual benefit. Your channel partners will be as important to you as some of your major customers and as such will require pro-active effort from you to manage the relationship with them.
* If you are going to be a channel for someone else’s products, don’t assume it is easy extra money. To be a good channel partner you will need to put in place people and processes to find the opportunities for the new product and then to deliver it. You will be the first point of contact with the customer – are you ready to handle anything that might be said about the product and its performance?
* If you are using delivery staff to undertake selling activities, then make sure they are trained, with techniques to aid the selling process and to understand their dual role, and managed effectively otherwise they will always find reasons to do anything but sell.
Copyright © Performative plc 2001-2006. All rights reserved.
Market Focus taking the proposition to market - To learn more about this author, visit Phil Shipperlee's Website.
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Market focus; the essential foundation to how and where you get your business. In previous articles we looked at what you sell (your proposition) and the mechanisms used to understand your proposition through the eyes of your prospects and customers, also who you should be selling it to (your target market). In this article we focus on how you get there (the routes to market).
Identifying the optimum routes to your market and ensuring you have the right mix of routes for your proposition and target market is an important part of business planning.
Routes to Market – how do you get there?
The route(s) that you choose need to be right for your proposition and your target market. It is important that you set goals and targets for the amount of business you want, and can reasonably expect from each route, that you create a plan around achieving those targets, and that you have a driven process which actually achieves the targets.
Viewed from a high level, you have two main options when deciding which routes to use; direct and indirect. You also need to consider whether business opportunities will come to you inbound or whether you need to take an action, an outbound action, to hunt for those opportunities. To some extent, the decisions will make themselves, as each type of product or service will tend towards a “preferred” or at least, more obvious approach.
Indirect:
If you are trying to sell something that costs a few pounds then inbound and indirect are the only economic options to consider. Perhaps the most common example is retailing, where the manufacturer is responsible for some of the promotional activities e.g. TV advertising, but the retailer (channel) does most of the work in making the products readily available to the potential buyer and also usually becomes the main interface between buyer and manufacturer for delivery, warranty, service and complaints.
Elsewhere in the business to business world the split of responsibilities covers an entire spectrum. At one end, the channel may be responsible for all selling and promotional activities while at the other end of the spectrum they may be responsible only for distribution or just providing you with leads to follow up. Regardless of where you want the relationship to reside across this spectrum, you and your channel partners must put in the work at the beginning of the relationship to define the mutual expectations for that relationship if it is to be successful. Once defined, achievement against those expectations must be measured and monitored on a regular basis.
Direct:
If you are selling a complex high value proposition with a sales cycle measured in months then the only way to achieve controlled success is through a direct outbound model as the selling process will involve you in presenting your solution and more importantly convincing the prospect as to the value of buying from you. The classic application of the direct model would involve you in employing your own sales team. The sales team will have two main roles; selling new business (“hunting”) and growing and expanding existing customers for repeat business (“farming”). The people doing the hunting and farming may be responsible for prospecting for new customers and new opportunities or this may be done by a dedicated team, which can be employed in-house or bought as a service from a specialist supplier (“outsourced”).
The selling activity may be done by a field sales team, a telephone based sales team or a mix of the two. The choice depends on a number of factors such as; the cost of your product, the typical order size, complexity and length of the selling cycle. If what you sell costs a few pounds and the typical order is for a few items, then you probably cannot justify a field sales team. If you are selling high value products and services where an order can be in tens or hundreds of thousands of pounds, then you will need a field sales team.
The sales team may be made up of qualified professional sales people. Alternatively, the selling activities may be the responsibility of the consultants, engineers, accountants, lawyers, etc, who will be engaged with the customer for the purpose of delivering your services once a sale has been made. It is common that such people fear selling and as a result do it badly and typically in an ad hoc manner unless given additional support.
Tips:
* Choose the best mix of routes to take your proposition to your chosen market.
* Ask yourself, “Why am I using the indirect route to market?” and ”Is the indirect route the correct choice for me or, am I simply abdicating the responsibility because the direct route is too hard?”.
* Regardless of the routes that you use, ensure that the responsibility for; prospecting, closing new business and extending business with existing customers is owned by someone and that it is measured and monitored regularly.
* Observe the approach of your competitors. What routes do they use and what do their customers think? Can you improve on the service given by competitors?
* Ensure you and your products are important to your channel partners. If they do not care whether they sell for you then they won’t – they must feel some pain if they fail to achieve the targets you have agreed with them.
* Select partners/channels where there is mutual benefit. Your channel partners will be as important to you as some of your major customers and as such will require pro-active effort from you to manage the relationship with them.
* If you are going to be a channel for someone else’s products, don’t assume it is easy extra money. To be a good channel partner you will need to put in place people and processes to find the opportunities for the new product and then to deliver it. You will be the first point of contact with the customer – are you ready to handle anything that might be said about the product and its performance?
* If you are using delivery staff to undertake selling activities, then make sure they are trained, with techniques to aid the selling process and to understand their dual role, and managed effectively otherwise they will always find reasons to do anything but sell.
Copyright © Performative plc 2001-2006. All rights reserved.
Market Focus taking the proposition to market - To learn more about this author, visit Phil Shipperlee's Website.
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Kim CastleWith nearly two decades in the advertising and design business, with clients like Domino's Pizza, General Motors, Direct TV, Pedigree, Wolfgang Puck, Higher Octave Music, Hollywood Celebrity Products, Disney, and Paramount, as well as thousands of entrepreneurs around the world define, structure, communicate, and position their business for greater profits, BrandU(R) co-creators Kim Castle and W. Vito Montone discovered that entrepreneurs could experience the same power that big brands command for a fraction of the cost with the world's only process-based results-drive Integral approach to business creation. BrandU(R) is helping entrepreneurs grow with the power of extreme clarity from idea...to brand...to market(TM) and helping one million entrepreneurs become successful and whole so that they can make a difference in the world. Are you one of them? If you want to experience clarity all the way to the bank(TM), get started now at http://www.brandu.com. - Visit Kim Castle's Website |
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