gathering relevant business intelligence (bi) using a...
TRANSCRIPT
Gathering Relevant
Business Intelligence
(BI) Using a
Pro-Active Sales Process
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Idea Validation and
Opportunity Assessment
Idea Validation and
Opportunity Assessment
• You have a good idea for an enabling
technology.
• You may even have a working
prototype
• You’ve made up your mind to build a
company based on this technology
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Idea Validation and
Opportunity Assessment
Before proceeding, rate your chances by taking this Success Indicator test (Check 0ne):
#1- I have identified a problem and have created a technology to solve it.
#2 - I have created a technology and need to find a problem that it can solve.
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Idea Validation and
Opportunity Assessment
Success Indicator Scoring:
#1 - I have identified a problem and have created a technology to solve it. – If you checked this, proceed.
#2 - I have created a technology and need to find a problem that it can solve. – If you checked this, go back to your lab and find an answer for question #1.
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Idea Validation and
Opportunity Assessment
Assuming you answered #1:1. Write out a benefit statement that a prospect for
your technology will understand.2. Emphasize how your invention helps a prospect
solve his or her problem better, faster, cheaper.3. Make it more concise until you can deliver it in
22 seconds or less (hint – eliminate any detail of how the technology works.)
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Idea Validation and
Opportunity Assessment
To Assure Success or Attract Investment You Need Answers to These Business Intelligence Questions:
1) Who will buy?2) How much will they pay?3) How many potential buyers are there
(How big is your market)?4) How do you best identify and approach
prospects?
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Idea Validation and
Opportunity Assessment
What process can you use to find the answers?
1. Research – UIUC Resources– Jeff Kurtz - OTCR Program– Ron Watkins - Illinois Business Consulting– Andrew Singer- Technology Entrepreneur Center– John Clarke & Amara Andrews- LAUNCH Program
2. Put up a web page and determine if anyone will enter an order
3. Proactively Ask someone (many someones) to spend money and buy an instance of your technology
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Idea Validation and
Opportunity Assessment
Attempting to actually sell your early stage technology can return very practical business intelligence:1) Define market size, competitors,
pricing and sales cycle2) Define your sales process3) Help guide development
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Who Am I?
• I’m a 40 year professional sales driven entrepreneur who has never had a salaried job
– Last 10 years have worked with early stage software technologies, particularly math and physics based
– Clients have included Fortune 500 companies, venture firms and local technologies helping them validate their investments, make their first sales, or expand into new markets
– Have licensed an OTM Technology and am incubating a company for my older son.
• UIUC Graduate
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Definitions
•Sales is NOT the plural of a four letter word-A “good” sale results from a positive decision by a qualified
prospect for your product or service.
-Good quality, profitable sales result from a process, not (just)
the overwhelming charm of the salesperson.
-Repeat sales and referrals result from satisfied customers
-Sales (process) includes a follow-up and is not a one time
event
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Definitions
• Qualified Prospect• Has a need for your product/service
• Has funds (Power to buy)
• Is Identifiable
• Is Approachable
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Thought Provoking Views
Regarding Sales
•Companies buy from people, not other companies•Decision Makers are people
•Xerox, Circuit City, and Car dealerships are examples of bad choices
•Benefits sell your product or service. (What can it do for me?)
•The capabilities merely qualify you for consideration.
•Although a prospect may show interest in your solution, ultimately it must
advance the prospect’s ability to accomplish his/her goals.
•Many failed companies have resulted from the seller giving
facts without a benefit statement•This allows a prospect to make an unfavorable decision (This software is
powerful. Prospect thinks expensive and hard to use.)
Idea Validation and
Opportunity Assessment
3 Basic Models for Distribution
1) End User
2) Center of Influence A. DistributorB. Rep Model
3) OEM A. Your product makes someone else’s better
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Commercialization Sales
Process for End User
Technologies
Idea Validation
for an
End User Technology
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Commercialization Sales
Process for End User
Technologies
• Identify 100 potential users (suspects)• Develop a 22 second capability
statement• Develop sales collateral• Call 100 potentials• Follow up with email • Send sales collateral to prospects• Record results
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Commercialization Sales
Process for End User
Technologies
• Identify your target suspects– Need your technology– Ability to Pay– Approachable
• Can you communicate with a decision maker?
– Sales Cycle• How many stages to a decision?• Price of product/service vs. budget• Layers of management/Purchasing officers
– Who is your competition and why are you better?
Virtual Sales Dept ©
Commercialization Sales
Process for End User
Technologies
• What would motivate a prospect to purchase your product or service?• Market Pressure – New facility (Business or church)• Regulatory Pressure – Compliance Tools• Market Inefficiency – Whole Life Insurance• Quality• Price• Convenience• Component to make their product better
Invention to Venture
UIUC 02/26/11
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
How Do You Find
Likely Prospects
Define the Market for Your Invention
Identify Firms active within the market
Data Mine for Persons/Positions
Target Key Decision makers with power to buy
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Sample Web Page
Prospects:
•Section508 Coordinators (FOIA)
•State Agency Webmasters and CIO’s
•Community College IT Deans and Webmasters
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Commercialization Sales
Process for End User
Technologies
•Keys for an Effective “Cold” Approach:
-You have 22 seconds to get your message across
-Emphasize benefits (what it can do for the customer)
-Avoid reciting facts
-Call before Mailing/emailing
-Build interest in the information
-Point of 2nd Call – Send more information to start a
dialogue
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Commercialization Sales
Process for End User
Technologies
What Metrics Should You Expect?
Out of each 100 calls
• 20 should ask for additional information
• 3 - 5 should express interest in purchasing
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
What if the Purchase
Metrics Don’t Conform?
• Out of each 100 calls fewer than give buy 5% buy signals– Benefit message too weak– Price too high– Unsuitable market– Product not compelling– No real demand– Sales Cycle is longer than anticipated– You haven’t called the right people or made enough calls!
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Be Prepared to React to
Prospect Input
Listen, Listen
Prospects will tell you what they
really want
Two Ears, One MouthGive Them What They Want
Don’t create a solution and go
looking for an problem
Heinz Ketchup Solution
Restaurant pagers example
Idea Validation and
Opportunity Assessment
Results of the process:• You’ve improved your idea• You’ve identified your market• You have a range of acceptable pricing• You can project market penetration results to
10,000 prospects to calculate cost of acquisition• You can prepare a reality based business plan to
present to investors
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Idea Validation and
Opportunity Assessment
Another result of the process:
You can design a launch
sales plan.
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Thanks for your attention
Questions/DiscussionKen Welch
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Decision Cycles
Samples of Various Cycles
Related to Price and
Decision Path
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Simple Sales Cycle
- Retail Walk-In <$100
Customer Sees
Item In Display or
Responds to Ad
Then Walks In
Decision in first 5 minutes
•Product Availability
•Product Suitability
•Salesperson
•Atmosphere (Sales Culture)
24 Hours
Invention to Venture
UIUC 02/26/11
Virtual Sales Dept ©
Simple Sales Cycle
- Retail Walk-In $10,000+
Customer Sees
Item In Display or
Responds to Ad
Drives In
Decision in 1 Hour/Close in 48 Hours
•Salesperson
•Atmosphere (Sales Culture)
•Product Availability
•Product Suitability
•Follow-up
•Customer Suitability (Credit)
48 Hours
Car
Business
Example
UIUC 10/06/10 Virtual Sales Dept ©
Sales and Marketing Buying
Cycle for a Software Co. (XYZ)
1 - Prospect Finds
Project Requiring
Products
2 - Prospect Researches
Products – Finds youNOTE: Prospect is usually an integrator
operating as an independent business or is a
captive within a large company.
3 - Prospect Gets your Quote –Decides to use in Project Bid
THIS IS THE BUYING DECISION!!!5 -Prospect Wins
Bidding Process/
Receives Approval
6 - Prospect Orders Proof of Concept Prototype Units
THIS IS THE ORDERING DECISION
7 - Deployer
Orders
Deployment
Prototype
NOTE: may be the
integrator or a
deployer/integrator
4 -Prospect
Submits Bid
OR
Seeks
Project
Approval
8 - Deployer
Places
Ultimate
Order
Complex Sell Cycle Example
$50, 000 Sale + Purchasing Dept Involvement +Government Approval = 18- 24 Month Sales Cycle