Life Lessons from Mt. Kilimanjaro

While I was in college I edited a manuscript for a friend whose novel was set on the slopes of Mt. Kilimanjaro. Ever since then I have wanted to climb the mountain, described as one of the highest walkable mountains in the world at 19,300 feet. This past December I finally faced my fears and did it. After years of helping startup companies face daunting challenges , it was time for my husband and I to face our own uncertainties. Would the lack of oxygen extinguish our will to go on, forcing us to turn back? Had the year's preparation of weekly hikes and extreme cardio workouts been enough? Are you ever really ready? The first day, starting in a tropical rain forest, was not too bad. Neither was the second, in which we traversed multiple climate zones to 12,000 feet. Then came the sleet and snow, and the unrelenting winds. By the time we reached camp at 15,000 we were exhausted, hungry and cranky. We could see the summit ahead of us, and it looked close. But as someone said: "It's further than you think, it's steeper than you think, and it's harder than you think." After sleeping a few hours we woke at 11:30, had a quick cup of tea and began our ascent at midnight. It was grueling. Hour after hour of traversing the rocky slopes, in the sleet and wind. We all struggled, mostly with our own minds, fighting the little voice inside that kept saying "You can't do this. Time to turn back." Just as I decided to pack it in, my husband said, "The way I look at it, it's only eight hours out of my life." Suddenly it didn't seem so daunting. Finally we broke through the cloud cover, the sun was shining, and just above us we saw the summit of Kilimanjaro. That's all it took to give us the extra burst of energy to make it to the top. What a spectacular view, and an unbelievable sense of accomplishment: all in all, a memory that will never be erased. With startups, we've all had that moment when we feel like we just can't go on, and question whether we should have started this endeavor in the first place. The obstacles seem too daunting, the probability of failure too overwhelming. But just as in climbing a mountain, you have to keep pushing. In spite of the frustrations and the challenges, giving up is never an option. Take the risk, dig deep, give it your all, take it one step at a time, and you can make it to the top. Tanya Candia CEO Candia Communications LLC  www.candiacomm.com

The Shortcut to Channel Sales

Quick way to channel sales (hint: there isn’t one)

Startups often turn to a channel sales strategy either as a standalone sales approach, or as part of a multichannel effort to complement the direct sales channel. Those who take the “boots on the ground” approach advocated in a previous blog (link) will take steps to ensure that their channel partners are the best and the brightest, well-trained and ready for the mission. Now that the effort has been expended, expectations are high. Perhaps too high! Where’s the revenue? Why are we not seeing results?

Immediate sales results, even from the best-prepared channel, are the exception rather than the norm. The reality is that reaping the rewards of the channel is a long-term proposition. It’s best to set expectations with senior management early on, so that there are no surprises. In order to explain this, consider breaking the expectations into phases, and giving management an idea of how long each phase might take.

Phase I –Channel Strategy

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This is the phase in which you determine what markets you are going after, and what types of partners you will need - in terms of expertise, coverage, and alignment of the partners’ marketing and go-to-market strategies with your goals. During Phase I will you determine how much, when and how to invest in the channel, through a combination of training, marketing support, technical support, channel management, and the like. In Phase I you will develop a full profile of the ideal channel partners. This is the most appropriate time to set expectations about when those investments will begin to bear fruit.

Phase II – Channel Infrastructure

During this phase, you will build the infrastructure for channel build-out. Here you hire the channel managers, develop the channel compensation plans and objectives, put in place the training programs and information assets that will address both sales and technical aspects, define and institute marketing programs that are geared specifically toward the channel, define the processes to support the channel, and ensure a full set of channel-ready tools. While not everything needs to be in place, everything should have been thought through carefully. Clearly, in Phase II you cannot expect to derive channel revenue.

Phase III – Recruitment

This phase involves recruiting the right partners, and the right number of partners.  Using the profile developed in Phase I, you will develop a target list that matches the profile in terms of the type of products and solutions they offer, their expertise and technical ability to sell and support your product. By this time, most if not all of the assets defined in Phase II should be in place, since the infrastructure is a key recruiting requirement. Some companies try to short-circuit this phase, by deciding to just go after all the partners of a major vendor, such as Cisco. This is a bad idea – not all partners are created equal. Some just happen to carry that vendor’s products, but they are not the partner’s key practice.

Phase IV – Channel Enablement

This phase involves working with the channel partners to make sure they are trained and fully understand the value proposition. Technical training of the pre-sales and support teams takes place during this phase as well. The channel partners are provided with sales materials and are theoretically ready to hit the ground running. So are revenues just around the corner?

Phase V – Channel Business Planning

Not so fast – first the channel manager must work with the partner to develop a joint business plan. This will include a go-to-market strategy with clearly identified target accounts, the programs needed by their sales team to go after those accounts, measurable goals for the first year, required resources and investments, and expected milestones. The first three months of the plan need to be spelled out in great detail, in order to facilitate the activities in Phase VI.

Phase VI – Channel Sales Assistance

This is where the hard work really begins. During Phase VI, the channel manager will work with the channel partner to begin prospecting based on the go-to-market plan. Here the channel sales manager plays a hands-on role with the channel sales team, helping them prospect, cold call, doing joint sales calls, coaching, mentoring etc. The channel sales manager will be a constant presence with the channel team during the first three months – it’s not unusual to have their own office at the partner site. Most successful companies require hand-holding the partner sales team for six months.

So in reality it can be a six to twelve month proposition before the startups sees its first dollar from a channel partner. It’s important to set the expectations properly, educate management as to what happens in each phase of channel development, and smooth the way to a steady, predictable revenue stream.  

“Feet on the Street?” No. What We Need Are “Boots on the Ground”

We are hearing a lot these days about “boots on the ground” – referring to our trained, well-equipped soldiers in Iraq and Afghanistan who are in place in a fighting situation. They are not just present, but have hit the ground running.  We know instinctively what this means in terms of their being able to execute their mission. They are not just airlifted into place but are professional, trained, equipped, specialized, and ready to face the unknown in order to follow through at every step of their mission.

This immediately brings to mind our usual notion of channel partners as “feet on the street” – able to address a bigger market than we can through our direct sales organization, but viewed as mere bodies that take up space. Are they trained and specialized in our products? Are they capable of taking on any competitor without flinching? Are they the “best and brightest” we can bring to bear? The shortcomings are immediately obvious. There are several things we can do to make sure our channel partners are “boots on the ground”:

·         Training: our military are trained continuously – we don’t content ourselves with a half-day of training once a year, followed by a raucous night of drinking and “bonding”.  As sales managers, we need to augment standard certification training with reinforcement training several times a year, with role playing, lunch-and-learn sessions, case study discussions, win loss analyses and other interactive training.

·         Hands-on assistance: in the military, there is no substitute for on-the-job training. Soldiers train in simulated battlefield situations, with live ammunition and the threat of imminent danger. While most channel sales are not life-threatening, it pays off when the channel sales manager takes an active role in sales calls with the channel partner. Helping the partner learn how to deal with objections, better understand the solution capabilities and compete against the competition will help form a bond and will pay off in the long run.

·         Special programs and incentives: there will be times when the channel partner focuses on other products in his arsenal, rather than yours. In order to keep the training and knowledge fresh, and encourage active participation, programs and incentives are key. These keep your product top-of-mind and create a reason to try to include your product in proposed solutions. The more your programs and incentives match the culture of the channel partner, the better they will be accepted.

But in the end it’s the channel manager who provides these ingredients, and ties them all together. One government reseller I worked with stated it clearly: “Your channel marketing programs are great, and the incentives are terrific. But I could never have achieved what we have done without my channel manager.” 

The Seven Deadly Sins of Startup Marketing

Tanya Candia just published this, and I thought it would be worth including in this blog. She covers all the basics which we oven overlook.

Startups have been around for a long time, and you would think that the mistakes made in the early days would be well-understood and avoided. However, in the past two or three years we have seen a series of errors in startups around the globe. They are easy to spot, and preventable. However, since they are so commonly seen, it is worthwhile discussing their importance and how to avoid them. Here are the seven deadly sins of startup marketing:

• Not enough market focus
• Not enough marketing focus
• Outsourcing the wrong things
• Failing to understand what goes on behind the scenes
• Producing random sales support materials
• Misunderstanding how PR works —and how to work PR
• Institutionalizing a we-they attitude with Sales

Now let uspresent each of these in a bit of detail, explaining why they are so deadly, and how to avoid their impact.

• Not enough market focus —Many startups go after two or three vertical markets and introduce a family of products. While this is normal in a large company, it can spell disaster for a startup. The lack of vertical market domain expertise, budget and market awareness can all contribute to failure to gain early market share. With a startup, less is more. Best practices indicate choosing one market, understanding it thoroughly, and then keeping things simple by introducing one product or service that brings clear value to that market.
• Not enough marketing focus— A green marketing exec will try to tackle all aspects of marketing: advertising, PR, web, direct marketing, analyst relations, collateral, etc. Quickly overwhelmed, he begins to outsource everything including copy writing and messaging. Much better to spend your time, efforts and budget in just a couple of areas: one should be the website, another should be PR (more about this below) and another has to be lead gen. Ask yourself: what bad thing happens if I don’t do any advertising or only attend one trade show a year? Will I lose sales, or will I free up time to focus learning what works in this market?
• Outsourcing the wrong things— Many startups spend money lavishly in the early days, bringing in high-end systems such as demand creation and lead nurturing. The most successful startups keep both in-house, and spend a lot of time and energy getting this right. I remember working at a startup where the VP of marketing tracked every campaign, looked at every incoming lead, and made sure that every lead was nurtured and followed up on. This attention to detail gave him a precise view of what was working and what was not. That way, he could tweak campaigns and quickly spot the effects. It takes a lot of time, but it’s time well spent.
• Not understanding what goes on behind the scenes
  A good marketer can do it all. The best VPs of Marketing can create the messaging, define the target market and value proposition, design and build the website, etc. Of course, they may not be experts at everything, but they understand first-hand what goes on behind the scenes. This doesn’t mean that the marketing exec has to do it all, but has to understand it all. Otherwise, budgets will be exceeded, deadlines will be missed, and results will be sub-optimal.
• Producing random Sales support materials
  How much collateral material is needed? Sales will say they need just the bit that will help them get the first meeting, overcome objections, and drive to a final sale. Marketing probably has a laundry list of pieces that are “needed” – based on past experience, board member requests, etc. Again, less is more. Before embarking on the quest for the ultimate collateral set, Marketing needs to understand what is really necessary to sell, by participating in sales calls, listening to the prospect, and thus determining the smallest set of collateral that will satisfy the needs.
• Failing to understand how PR works — and how to work PR
  PR is the startup’s best friend. A company that cannot afford to hire a PR firm early on can still do a lot to lay the groundwork and build awareness. Build story lines, get customer testimonials, measure customer satisfaction, do surveys— then pitch your own stories. Start to build your own relationship with the journalists and analysts, giving them information that is relevant and interesting to their constituents. Then, when you are ready to engage a PR firm, you will have laid the foundation and built an initial set of interested media.
• Instituting and institutionalizing a we-they attitude toward Sales
  This is one of the most potentially destructive attitudes for a startup. In a big company, an exec fights for his own department, and understands how to get budget, resources and recognition. In a startup, the boundaries need to be erased. The only entity that matters is the company, and it stands to reason that the only thing that matters is sales. The attitude has to be “We are all in this together, and we will work side-by-side to make sure we as a company succeed.” Here, there is no room for ego, animosity or isolation.

Learn from the mistakes of others, and make sure you don't repeat the past. Make your startup the best it can be, with a positive attitude, judicious incestment of scarce resources, and most of all, productive cooperation across the company.

Top of Mind - or Out of Sight?

No doubt about it – you’re in a very competitive situation. Your channel partner is selling multiple products; he is very comfortable with some, less familiar with others, and yours – the newest product in his toolkit – is at a distinct disadvantage because one of more of the following are true:

·         Unknown product

·         Unknown vendor

·         Low margins

·         Low price

·         Weak incentives

·         New technology

Just like any sales rep, your channel partner will find the easiest path to closing a sale. And that means going back to the tried-and-true products. These are the comfortable products: the rep knows how to sell them, and how the customer wants to buy, understands the competition, and knows how to position the product and its value.

A new product, from a new vendor, especially if it represents new or breakthrough technology, requires time, learning, focus and attention. In other words, it costs the channel sales reps time and, possibly, money. It slows their ability to make their numbers. For this reason, the new product drops to the bottom of the list and doesn’t get a lot of mindshare.

Channel sales managers should anticipate this situation and prepare for it. How to get mindshare? The most important thing is to make sure the channel sales and support team are trained. Training must include the product (functionality, benefits, features, how to sell, to whom to sell, where to sell) as well as any pertinent information on the vendor background as it relates to expertise, IP, background, industry knowledge, etc.) as well as information on how to demo, install and support the product.

Once the channel team is trained, don’t stop there. Take active steps to make sure they achieve early success in selling the product. The tendency at this point is for the channel sales manager to focus on lead generation or MDF-funded activities. Don’t do this. Don’t rely on leads or MDF to jump-start a reluctant sales team. They will always say “I’ll do it later.”

My approach is to always, as a channel sales manager, is the following:

1.       I find 3-5 really significant opportunities. These come through working with the channel’s own sales organization to identify the opportunities, or finding them through my own corporate marketing organization. The important thing is that I am responsible for finding them – it’s not up to someone else.

2.       I identify two or three channel sales reps who have potential, and can be convinced it’s worth their time to take on a new product.

3.       I get in the trenches with them, develop a script, do some role-playing, then do cold calling together with them. This helps me make sure they understand the messaging, value proposition and competitive landscape.

4.       I work with them to develop the 3-5 opportunities, while developing new leads.

In this way, I can accelerate their path to early success, which builds mindshare inside the channel organization and leads to increased early acceptance of the product.

Marketing and Sales – an Unbeatable Combination

Many people think that the principal job of Marketing is to generate qualified leads. In fact, Marketing’s job varies greatly throughout the lifecycle of a company. In the early days, lead generation is especially challenging, due to the lack of one or both of these key elements:

·         A known and respected company/brand

·         A credible solution

While leads can be generated, their worth is often questionable in the absence of the above elements. To overcome this early barrier, Marketing and Sales need to work together to quickly and diligently break down the obstacles.

Let’s examine a couple of situations:

1 – A big-name, well-known company develops a new product and introduces it to the marketplace.  With a full marketing machine, lots of money to invest, and a strong company name to leverage, Marketing can provide Sales with lots of qualified leads.  The driver: company and brand.

2 – A lesser-known company develops an innovative product and makes early sales to early adopters who, through demonstrations, see the clear benefits of the product in terms of cost savings, flexibility, etc. Even without an established marketing machine or lots of money, the company can expect that prospective customers will react to the demonstrated benefits, and Sales will find it easier to close deals. The driver: credibility.

Contrast these with the situation at many startups:  it’s an unknown company that has developed an innovative product but does not have a credible product or a proven track record in approaching an existing market in a new way (or creating a new market.) In this case, which is all too common, Sales and Marketing will need to work collaboratively to help build a healthy pipeline and remove the obstacles to future success.

What does this collaborative approach look like?

The effort must start with a solid value proposition and clear, differentiated messaging, which come initially from the marketing group. The focus must be on the target buyer, the pain to be solved, and the benefits of this solution.

Marketing can then begin to build awareness through press outreach, regular briefing of industry analysts and key journalists, and submitting contributed articles to help elucidate the value proposition and show why it matters. This helps build awareness for the company, so it’s no longer an unknown name.

The Sales team can take use the value proposition and messaging to begin evangelizing the solution. It is vitally important for Sales and Marketing to collaborate closely in this endeavor, since the Sales team will receive first-hand feedback from the field about what works and what doesn’t. In our experience, the more closely Marketing participates in early sales calls, the better it can fine-tune the messaging and align the value proposition to the precise needs of the target customer.

By working collaboratively with Sales Marketing can enlist the help of early customers to articulate the value they have received from the product in their own words. These early customers can become spokespersons for the product and the company. This entails working with them to develop case studies and testimonials, and perhaps even grooming them to speak to journalists and analysts, or give talks at industry events.  This helps build credibility for the product.  High-profile, vocal customers who sing the praises of the product can generate buzz across the industry, helping develop brand awareness and establish credibility.

An example shows how this works in practice:

In the mid 1980’s, when Sun Microsystems was a young, virtually unknown company in a field of much larger, established names such as IBM, DEC, and  Hewlett Packard,  Marketing worked to provide the Sales team with strong messaging and a way to show the value of the product. While Sales pursued early deals, Marketing was focused on providing air cover by engaging in heavy press and analyst relations to build buzz, and grooming early customers to be spokespersons.  But the Sales team often encountered pushback from prospects who failed to understand why they should deal with an unknown company as opposed to a safe, known vendor. The Marketing VP and Product Marketing Managers immediately started going on calls with Sales to hear first-hand the issues, and improve the messaging. By the end of the first year, there was constant collaboration between the two teams, and the company was able to quickly build an impressive pipeline while its brand became better known.

In the Sun example, strong sales people worked hand-in-hand with an eager Marketing team to jointly evangelize the solution, learning from prospects and early customers, and continually honing the message while simultaneously working to build awareness and credibility. 

To ultimately generate good leads and accelerate sales, both Sales and Marketing must deal with the fact that there is no brand name recognition and no established credibility in the marketplace. Collaboration is critical for Sales to succeed, and for Marketing to provide the tools and resources needed by Sales. Each has a responsibility and a distinct role to play, involving communication and collaboration on the messaging, value proposition, product set and features - an ongoing basis. 

The Channel Sales Manager - A Breed Apart

I work with many startup companies that see the benefit of channel sales in taking their product to market. However, many of them do not really understand what makes a good channel sales manager. They think that any sales manager can be a channel sales manager: the only difference is that now there is an arms-length relationship with the end customer. In Over the years I have come up with a channel sales manager job description that encapsulates what a good channel manager should do throughout the lifetime of the channel partner relationship. Follow this job description, and you just might find that your channel manager drives early and ongoing success.

The channel manager:

·         develops the business plan with the channel partners

·         ensures partner enablement – both training and campaigns

·         engages in joint selling activities with the partner

·         conducts post-sales analysis for mid-course correction.

·         retains responsibility for the success of the channel partner.

The good channel manager works with the channel partner to develop a business plan. No, this doesn’t mean asking the partner for a business plan, and then listening to the many obstacles that get in the way. Instead, it means that the channel manager will sit side-by-side with the channel partner to set objectives, determine which markets and accounts will be targeted, and define the goals and metrics, ensuring that the business plan is in line with the company’s goals, make sure there is no territory or channel conflict, ensure that the business plan leverages the assets and strengths of the VAR, and is complementary to your company’s coverage plan.

A good channel manager ensures that the partner is capable of achieving the goals set out in the business plan. That means making sure both sales and support staff have been trained adequately, and that sufficient marketing campaigns have been put in place to generate opportunities or, in the absence of marketing campaigns, that a list of top target accounts has been developed and an approach to win them has been determined. Since mindshare is crucial, the good channel sales manager will ensure that incentives for reaching the target are put in place, whether MDF funds or specific discounts.

The good channel manager is not just a bystander, watching the partner go out to do sales. Rather, this person is an active member of the channel sales team, helping to find and nurture leads. S/he develops scripts for cold calling to ensure that the partner positions the products properly in the context of their own solutions, the messaging is on point, etc – and will do joint sales calls with the partner in the early days, to develop mindshare and  make sure the message is being delivered correctly. This also serves to give confidence to the customer that they will receive not only the support of the channel partner, but also of the original product developer as well.

The good channel manager carries through by participating in every phase of the sales process, up to and including the post-sales analysis. Since the channel manager is responsible for the channel partner’s forecast, and for the channel partner achieving the forecast, this person needs to be on top of every lead, every opportunity and every win – or loss. If the channel partner complains that they are getting no leads from corporate marketing, warning bells should sound. It’s not about raw leads – it’s about building a partnership and a relationship of trust and mutual dependency between the channel sales manager and the channel partner.