Selling during a Recession
It’s not if but when. Is your sales organization ready?
It’s been eleven years since the great recession. How much muscle memory does your sales leadership and organization have. Being that the head of sales job changes about every 24 – 32 month and the average age of a senior executive is 52 years old1. Therefore, it’s safe to assume most sales leaders did not have to live through the great recession.
In 2008 I was three years into my first job as Senior Vice President of Corporate Sales and had survived the burst of the .com bubble in 2000. Both economic down turns were different and both provide great lessons and significant challenges.
When economy began to fall apart in 2008, I remember quickly thinking, “This is not good, I need a plan of action now!”
One of the first things I did was Google, “selling during a recession.” Out of the millions of posts, there wasn’t much good information. What was helpful was vague. “Stay calm . . .” “Don’t neglect your base.” “Don’t Devalue your product.” It was at that point I began to develop a simple set of actions which ended up helping me navigate troubled waters. Knowing it is easy to over architect any solution and needing to act fast I settled on taking a few actions directed at employees and customers. I made sure all senior executives supported the plan as we would certainly need support from other functions to be successful.
As your sales team watches the nightly news, they will begin to think about how they will be impacted. To win I knew I needed an engaged employees. So we went about modifying the compensation plan and creating a sales contest that rewarded for the behaviors necessary to win.
We also made it a priority for every
executive to know the top producers and provide recognition as appropriate. We also knew top talent at other firms was valuable and could be willing to make a move. We made sure we had the necessary plans in place to secure good sales people as arose.
Next I assembled a team to analyze our position with our top 25 customers. In most organizations the top customers will control a lion’s share of the total revenue. We set up a war room and looked at contract terms, compliance to service level agreements and width and depth of relationships. We then worked with the sales team to develop retention plans which we monitored weekly.
We required each sales manager to develop retention plans for their top ten customers and each rep, their top five customers.
Next we conducted pipeline reviews. What were the few opportunities we could rally the company to win. This required deeper than usual pipeline reviews. At the same time we looked at opportunities to grow share of wallet with existing customers. Oftentimes to win we needed to augment products and services to win. While we couldn’t customize a solution for every customers. We did know 3-5 changes we could make to win multiple customers. We quickly engaged operations for support.
As we fought our way through the next 18 months, we stayed focused on executing and the team responded favorably. All top 25 customers were retained, share of wallet grew 5% and overall volume decreased ~ 4.5% less than the industry retracted. We also won two large, multi-year contracts.
The most important thing is to keep things simple, keep actions front and center and get the organization focused.
Sources: Selling Power Magazine, “Strange Case of the (Vanishing) Sales VP”, Baldwin Harvard Business Review, “The New Road to the Top”, Cappelli and Hamori