How to build a sales machine without gambling on sales people

If you want to boost your startup’s sales, what do you do?

The most popular answer seems to be “hire a full-time commissioned field salesperson.”

In other words, (1) you hire somebody full time, (2) pay them a commission on sales, and (3) have them go out in the field and sell.

Justin Roff-Marsh, founder of Ballistix, thinks startups “shouldn’t be doing any of those three things.”

Instead, Justin prefers to create a “sales machine”.

“If your objective is to make money, the industrialized approach to structuring environments…is well-proven,” he says.

For instance, he helped one of his clients create a sales machine and “they doubled sales almost immediately”.

In Justin’s Mixergy course, he shows you how to do it. Here are three highlights from the course.

1. Stop Chasing Them

chasint

These days, it’s almost impossible to get a prospect on the telephone.

“Even if a founder said, ‘I make 200 calls, and out of 200 calls, three people pick up the phone. And of those three people, one of them listens to me and agrees to an appointment.’ I still couldn’t get excited about that because how’s the founder going to grow his business?” says Justin. “How long is that going to persist for? And how is he going to find other people who are prepared to subject themselves to that?”

And if you do hire a salesperson to make those calls, you’re not going to get great results.

“It’s a lazy assumption that salespeople create sales, because for the most part they don’t create sales,” says Justin. “Salespeople, if you are lucky, will be capable of prosecuting sales opportunities, but in most cases they are very poor at generating sales opportunities.”

So if outbound sales doesn’t work, how do you reach new customers?

Go after inbound sales

Write a compelling proposition that gets customers to come to you.

“Your basic offering has to be appealing to the market,” says Justin. “And if the offering is appealing enough to the market, then we are going to be able to come up with a compelling proposition.”

To find out if a proposition is appealing enough to generate inbound sales, Justin tests it with pay-per-click ads.

For example, to promote a book, Justin ran ads offering free individual chapters, calling them “reports.” But he found out that no one wanted free reports. “I discovered that…[giving away the first free chapters] works so much better than giving away ‘reports,’” he says.

And if you can’t come up with a proposition, that’s useful information, too. “If you can’t figure out a way to compel potential customers to initiate contact with you, then you haven’t finished developing your product yet,” he says.

2. Don’t Do the Hustle

hustle

Think you’re ready to hire salespeople? Not so fast.

“If you are a startup, then by definition you’re going to be small,” says Justin. “It makes no sense whatsoever to employ full-time salespeople if you are a startup. You probably need to grow to the point where you are doing $5 million dollars a year before you can justify having anyone who is full time responsible for sales.”

But Justin admits that there aren’t enough hours in the day for you to everything by yourself.

“There’s a huge amount of paperwork required in order to progress the [sale], and the paperwork is enormously time-consuming,” he says. “When you look at the total effort expended in order to prosecute a sales opportunity, the majority of the effort is just hustling, just ringing people saying, “Dude, where’s the paperwork?”

So if it’s so time-consuming, how can you be the only salesperson?

Only handle critical selling conversations

There’s a difference between hustling and critical selling conversations, says Justin.

Hustling is the time-consuming paperwork and scheduling process. “What happens is people conflate the two and they call it selling,” he says. “But the reality is that the hustling is just hustling, and anyone can do it.”

So Justin uses systems and assistants to handle the hustling part, which frees him up to handle the critical selling conversations. “Someone else has scheduled it,” he says. “All you have to do is put your headset on, sit down at your desk at the scheduled time, dial a number, have the conversation, and then tell someone what the outcome was so that they can take it and do whatever needs to be done next.”

3. Go from Manual to Automatic

automatic

After you create a compelling proposition, you still have to get prospects on the phone.

“The end point is…the point at which we’ve convinced somebody to participate in…a critical selling conversation,” says Justin. “In other words, a sales call.”

But getting a phone number and scheduling a call isn’t as easy as it sounds.

“What used to happen is that [our executive assistant] would follow up on all the people who requested books individually and chase them down,” says Justin. “But her capacity to do that was fairly limited, and it’s so easy for us to generate book requests that we were continuously choking back online advertising. And also a lot of her activity chasing people was relatively unproductive.”

So how did Justin get the phone calls and streamline the process?

Automate the sales process

Justin uses an automated system to gets prospects on the phone.

“What we discovered is [that our system] works just as well, if not better, automated,” he says. “Now we can generate a much higher volume of sales opportunities without maxing out [our executive assistant] because [she] only interacts with people who schedule a [call].”

To do this, Justin uses a four-step system.

First, a prospect clicks on an ad and requests the free offer.

Second, Justin mails the offer, which is always something physical. “The reason it’s beneficial to do that is if people are expecting stuff in the mail, they give you accurate information,” he says. “And more importantly they tend to give you a phone number.”

Third, when the offer is mailed out, the prospect is automatically added to an email autoresponder sequence. “The autoresponder sequence, over a period of 10 weeks, is designed to upsell them to a conference call,” says Justin.

Finally, the prospect schedules a call on Justin’s calendar. Or, if the autoresponder series ends and the prospect hasn’t scheduled a call, the prospect is automatically invited to upcoming webinars.

“The webinars for us are huge…not huge numbers, but…a good percentage of them will request [the conference call] off the back of a webinar,” says Justin.

For the rest of the course click here.

Cheat Sheet written by April Dykman.

  • http://www.facebook.com/dylan.watkins.9619 Dylan Watkins

    Excellent Interview. Breaks down the sales process into manageable bites with the division of labor.

  • Arie, Community Manager

    Thanks, Dylan.

  • http://www.facebook.com/dodie.jacobi Dodie Jacobi

    99.9% of my clients need this advice, and so did I! Can’t wait to try this out, and post all over z place to spread the word of another great Mixergy offer.

  • http://swombat.com Daniel Tenner

    $5m turnover before hiring salespeople? Er… no.

    Like all advice, this really depends on the context. If you’re selling a product that returns about £5-50k a year, and have defined your sales process, and have a good source of quality leads, then hiring full-time salespeople makes a whole lot of sense.

    Inbound marketing, with google ads or otherwise, also does not work in a market where people aren’t searching for your service or product.

    Context is everything.

  • http://www.facebook.com/people/Kim-Martin/783602817 Kim Martin

    And I’ll tell you that many many businesses literally throw away thousands upon thousands of dollars(and I have the recordings to prove it) a year through NOT knowing how to handle an inbound call properly. I’ll also add that most businesses also go bust because the owners cannot grasp the most fundamental aspect of their businesses is NOT their “business” but their marketing.

  • Joseph Rogers

    How would this be adjusted to a service business? I think there are some interesting tidbits, there, but can’t quite make the jump to how I’d apply to my own business.

  • Bob Hiler

    Joseph, the four-step system that Justin uses is outlined in the “Automate the sales process” section. Justin has a service business too, so it seems applicable? For instance, you could use his four-step system to schedule conference calls with prospective clients for your service business.

  • BK

    Ha. If the product is web-based, sure go for it. But to say salespeople don’t generate sales is a farce. Perhaps this guy has just been burned by crappy sales people in the past.

    I oversee sales for my startup. 98% of the customer appointments and real sales opportunities have been generated by outbound sales efforts.

  • http://www.facebook.com/mmcewen Michael McEwen

    I’m sorry.. but wait until your business is doing 5mil a year before hiring a full time sales person? I can totally understand this for a business like MIXERGY – but can you imagine telling someone with an enterprise software for blue chip clients this – absolutely ridiculous.

  • http://www.salesprocessengineering.net Justin Roff-Marsh

    Well, if were selling enterprise software to blue-chip clients I absolutely would recommend deferring the addition of a full-time field salesperson.

    You don’t need that many sales in that space to get to $5m a year (far fewer than Mixergy does). Better to have the founder do the relatively small number of field meetings required and use the money you save to provide the founder with an executive assistant and to build the promotional machine.

    This is a lower-risk strategy for a technical founder (who would find it hard to evaluate the capability of a salesperson) and would result in a better platform to scale from.

  • http://www.salesprocessengineering.net Justin Roff-Marsh

    It’s true that sales opportunities CAN be generated by salespeople — and I acknowledged that. But I maintain that, for the most part, salespeople DON’T actually generate the vast majority of the sales opportunities they prosecute. Most come from existing clients, either directly in the form of repeat inquiries or indirectly in the form of referrals.

    Prospecting is like mining for gold. You have to move a ton of dirt to find an ounce of gold. Most salespeople simply don’t have time for the spade work required to generate anything more than a tiny trickle of opportunities.

  • BK

    I couldn’t agree more, Michael. I’ve worked with technical founders, and can say with confidence that someone with sales experience & an explicit charter (we’re talking enterprise) is far more effective in actually finding, working and closing deals.

  • BK

    I have to respectfully disagree.

    Of course, there is a big variable – what are we selling? If this is truly innovative, disruptive-type stuff, then your model just does not work. If there is an incumbent, and you have simply made a better mouse trap, it may work. But if you’re innovating, customers will need time spent with them in all phases of the sales cycle to educate, demonstrate & convince them. The enterprise sales cycle is not simple or static. Without someone (or a team) explicitly ushering customers through, your growth will be stunted.

    So, while I agree that prospecting is a very tough, low-yield effort in isolation, it is necessary and should be approached as vital to growth.

    The quality of the bottom of the funnel is a product of the top of the funnel.

  • http://www.salesprocessengineering.net Justin Roff-Marsh

    BK

    Before you respectfully disagree, perhaps you should listen to the course. That way your objection can be better founded.

    Fact is, WE are selling truly ‘disruptive-type stuff’, as is evidenced by the incredulity exhibited in some of these comments. If you really intend for your position to be as absolute as it sounds, it will be dismantled by a single counter example.

    How can you suggest that there is no one explicitly ushering customers through the engagement process when I make it clear that we appoint a person who does nothing but this?

  • BK

    I get it. So one anecdote dismantles everything.

    Got it. Check.

  • Arie, Community Manager

    Thanks, Kim

  • Pingback: Fresh Business Info – Saturday, February 23, 2013

  • Rob Rawson

    I have to say I agree with this for most businesses. There are exceptions, but on the whole I think that hiring expensive sales people is an inefficient way of doing business and the businesses that take this approach will not be as successful in future. They will be replaced by businesses that have a more efficient sales and distribution mechanism.

    For companies that are selling a million dollar product, a sales person is essential (and affordable). For companies selling $100 products the sales person needs to be extremely efficient or in fact the business can get rid of the sales person altogether. Look at businesses such as Amazon, Google … do they need sales people? Generally no because their product is better, cheaper than the competition.

    It’s not simple there can be a blend, but I think for sure any business with sales people is going to need to become a whole lot more efficient in using those sales people in future.

  • http://mixergy.com Andrew Warner

    BK, consider deleting this last comment. I don’t think you meant to sound as sarcastic as this. If I’m wrong, feel free to leave it up.

    I just think it doesn’t help the conversation — unlike your first point, which raised a useful question and got 2 past interviewees to add their thoughts (Rob & Justin).

  • http://www.salesprocessengineering.net Justin Roff-Marsh

    BK. My point is, if I say, here’s an example of me doing ‘x’, it is, in fact, invalid for you to claim that ‘x’ is not possible, unless you find a flaw in my claim. So, in this case, you’re right, one result *does* invalidate the hypothesis.

    From a broader perspective, I’m frustrated by this kind of incredulity. I don’t understand why some respond to this contentious content by disputing whether or not it is possible.

    A more fruitful line of questioning, IMHO, would be to accept it’s possible in some cases and then try and understand the boundaries of the new theory: what are its limits. It’s at the boundaries where new knowledge is most likely to be created.

    If asked, I’m quite happy to talk openly about those environments where our approach to sales won’t work — and shouldn’t be attempted.

  • http://twitter.com/strmln Bulut Sakchak

    Even though I have limited experience in sales field; after watching this course, and also buying your first book and reading several chapters, I can see how superior your approach is to the conventional way. Maybe people are reacting to the suggestion that not to employ salespeople before hitting $5M a year but I love how scalable this approach is and how much guesswork is out of the equation.

    I was planning to utilize this process for my own endeavour but this comment made me wonder where this approach wouldn’t work. I am also curious about if professional services like legal or medical practices can benefit from the same approach for their online marketing initiatives. I see the similarities between such businesses with small b2b companies. What’s your opinion on this?

  • http://www.salesprocessengineering.net Justin Roff-Marsh

    It does totally make sense in those environments. Partly because our approach explicitly recognizes that resources have finite capacities and plans accordingly.

    It doesn’t make sense for retail or out-of-the-back-of-the-truck sales environments. It also mightn’t make sense for a start-up that was pivoting every 10 seconds in search of a viable model. In that case, any infrastructure is an impediment.

    For professional services example, listen to this interview (small accounting firm). The video quality is horrible, but there’s value in it nonetheless.

    http://www.salesprocessengineering.net/2011/01/04/accounting-firm-abandons-time-and-material-billing-and-converts-practice-to-factory-team-morale-and-customer-satisfaction-up/

    Justin

  • CMS

    I grew my business from $200,000 a year to $2 million a year net (within 12 months) all because I hired 2 commission only-sales people. I sell Intuitive Life Coaching (Yeah…I know, “What’s that?” is the most common question I get, hence the need for sales people and amazing educational, marketing websites.) And without a sales force, it would have never happened. Sales people changed my life!! I raised my prices, worked less, sold more products, & fulfilled my life purpose by helping more people. I have had over 50,000 people on my online webinars….more than once. This was the most random, uneducated comment I have ever read. Every business is different. I built online sales funnels, but if someone is going to buy higher end products ($3600-$7000) then they may need to speak to someone. Some people, just need to know that the thing they are buying works. Even when I educate them throughout the way, sometimes they need a human being saying….”Hey, this is good.” and answering some concerns or misaligned information. I don’t normally post, but waiting until you make $5 million is bad advice. If Mixenergy would like to interview someone about using a sales force to grow into a multi million dollar company, combining effective marketing funnels, in a not normal business, then email me please. I would have lost out on millions of dollars if I had listened to this advice. Please hire smart, hungry, sales people to change your bottom line. If they are good, they pay for themselves straight away.

  • http://mixergy.com Andrew Warner

    I’m emailing you.

    BTW, it’s Mixergy ;)

  • http://www.facebook.com/daniel.dunsford.3 Daniel Dunsford

    agreed.

  • Collin Stewart

    Yes, Andrew! Please do it.

  • http://www.decalmarketing.com/adwords-book/ Iain Dooley

    So where is the interview with “CMS”? I’d love to check it out but I need a name to search for it :)