"MIT has shown the digital business model is more resilient and they have also shown Boards with three or more digitally savvy directors had 17% higher profit margins than those with two or fewer, 38% higher revenue growth, 34% higher return on assets, and 34% higher market cap growth." Research here.
A recent National Association of Corporate Directors (NACD) survey showed that "68% of directors responding indicated that over the next 5 years their existing strategies will become completely irrelevant, while 61% identified effective board engagement in strategy as the most important priority for their boards in 2020."
A Tale of Two Companies
It explains the differences between two companies.
"Company A are stuck in Analogue mode.
Company B decided to move to Digital during lockdown.
What's the difference..?
Let’s look at Company A:
Prior to the pandemic, Company A had what we might call a ‘traditional’ approach to sales and marketing, lead creation, pipeline and funnel management and forecasting.
Marketing organised adverts in trade journals and that made sure they were at 2 big shows and a few smaller ones every year. They did know whether the adverts did anything for them as they couldn’t measure it, but they got some decent leads from shows.
They did some advertising, the idea was to send people to a piece of hero content, (written by their marketing agency) that people had to give up their emails to read.
They ran email drops every quarter and had the usual internal debate about how many ‘bounce backs’ there were, arguing with Sales about keeping up to date with email changes. They debated about what exactly was a good open rate and what did that mean...?
They also argued with sales as to, what exactly was a lead?
"Social Media" was run by one person in Marketing, they put a corporate advert on LinkedIn twice a week everyone got an email to like and share the post…that was as far as it went and nothing much came of it but, they all believed they were ‘killing it Social Media’.
The sales VP would post on Linkedin every two weeks (fortnight) and an email was sent around to get all her directs to like the post.
Sales were making lists, emailing, and calling. Setting up meetings, pitching, following up, proposing, and trying to convert. The CRM was up and down, some used it some didn’t, the Sales VP wasn’t that bothered as long as they did their numbers… they would say “if it keeps them off the phone, its wasting our time and I know what they are up to anyway….”.
Things started to bite in 2018 when they all noticed things were getting harder, their response was to do more. They had to make more cold calls to get the same response and send more and more emails to try and get the same response they did before.
Then Covid hit: Email campaigns and cold calling now completely ineffective for prospecting, no trade shows to scoop up those leads, adverts ignored…
6 months into the Pandemic and Company A have held firm, they believe things will come back, they talk about “green shoots in Q1”, the “rub of the green” and “when things get back to normal”. I recently spoke to them and they said "we are just going to wait out the next 8 weeks, things will pick up in January, I'm sure".
When you ask what they did to fundamentally change their business to adjust to a ‘new something’, they tell you about furlough and staff reductions, they tell you about adjusted forecasts and cash flow, they tell you about “working from home” and how they might be shrinking their office space….but nothing has really changed.
The Sales VP said to me "we are all social selling now, we use Zoom to make calls".
In terms of Sales and Marketing, there are now less people with all the pipeline responsibility, less budget, and more pressure.
Company B took a different path:
They too saw a difference in 2018 but didn’t really know what to do about it, they started to look into it then.
Company B worked in pretty much the same way as Company A in their approach to demand generation, lead creation, pipeline and funnel management and forecasting. Trade shows, emailing, cold calling, prospecting and running adverts.
They acted on their observations in 2019, they put more effort into measuring the data. Where their leads were coming from, why and who etc. They looked at conversation rates and really got to the roots and branches of how it all worked, and what didn’t.
They didn’t keep this just in Sales and Marketing, the opened it up to Quality and Finance – people with different perspective and different mindsets. They mapped everything out and looked at projections and options…
In March 2020, Company B decided to take Social Media seriously as a way to connect and engage with clients, prospects, suppliers and new recruits, the decided to get Strategic with Social.
They trained their team, not just Sales and Marketing, the Management team, Operations, Technical, HR and so on. Company B know that you "cannot get a little bit pregnant" so they didn't go done the path of "masterclasses" and "hints and tips" they went for a company that had a pedigree and a proper methodology.
This was a transformation, and it was a team effort. This was a new game, and the rules were different. They had a strategy; a mission and they knew where they were going. It was a "new something" and they had to do something new.
This changed the metrics. They were now interested in numbers of connections and conversations. They were now all creating rich and engaging content, all of them and they were interested in what worked best and what didn’t, they did this together and is was improving their performance – first the first time in a long time, they had a shared sense of purpose. The soon found that posting on Linkedin got them C-Level meetings, even Linkedin Stories got them C-Level meetings.
The CEO know as much about their Social Media Strategy as the Marketing lead, why? Because they were all in this together, their efforts started to turn the volume down on their competition and they started to dominate the Social share of voice in their sectors.
Commercial conversations increased, visibility increased, inbound increased, pipeline increased, the culture improved…
Company A: Pipeline was severely hit in 2020, now it's all about 2021. How will they forecast for 2021? The prospect base is no longer answering calls and emails pile up unanswered. The Sales and Marketing team is under extreme pressure as the entire commercial framework is built on outdated models, theories and techniques. They have moved all their suppliers onto 120 days as their cash flow is impacted and the hunt for new smaller offices has increased. But hey, it will be OK in 8 weeks ... won't it?
Company B is flourishing. A significant difference between the two organisation is that Company B use the team, they are moving forward as a strategic unit. In an organisation of 50, 12 of the team are now Social Selling.
They work together to make sure their organisations profile is dominating the social space. They coordinate content releases and monitor engagement. They realise from CEO, CFO through Directors and Managers that Social Media has changed the world and they needed to change. They understand that their social footprint is so valuable to them that they give it board level status. To them, social media is strategic not tactical.
Organisations who are really Social Selling, who have a real Social Media Strategy, can tell you to the penny how much of their revenue and pipeline can be attributed to their Social Media presence and activity…do you know yours?
The gap is Social Maturity....
Company A's management team still believe sales is about cold calling, email campaigns, adverts, and newspaper articles. They say things like “Social Media is all well and good, but we like the personal touch with our clients…”. We all do, that’s not the point..!
The Sales Leader says things like "it worked for me 20 years ago, so why won't it work for me now?" So did VCRs and fax machines.
How do you build relationships, trust and conversations with a prospect that you’ve never met by cold calling and email, in 2020? And how do you do that at scale...?
Company A doesn’t understand Social Media, so they don’t see the benefits in Strategy. They’ve been left behind...
Company B has embraced Strategic Social Media as the key to their success. They are socially mature, knowing that the future of their business lives within the platforms, of what their competitors believe, are toys…
They went into lockdown in Analogue, they came through the Pandemic as Digital…
What Is Social Maturity? - Why Is It Now The Difference Between Life and Death For a Business?
While we are under self-isolation at home, we are seeing changes to society and business take place in real time, it’s happening right in front of our eyes.
One of the big changes we are seeing is that of people realising they need to do something new. An acceleration for the changes we’ve all talked and talked about for years now a double time step change to what was known as “business as usual”.
In business, social has transformed the way we work. We are check people out before we meet them and make judgements about what they are like. Will it be an insightful meeting, or will it be dull, and I should I just cancel it at the last moment?
Sales leaders are already shifting gear away from the legacy sales methodologies of the past. They are looking for new attitudes, new behaviours to deal with the current crisis.
With pipeline going soft due to Covid-19, lockdowns and economic uncertainty, we need to be able to talk to more people and calling people adds to more friction. You pick up the telephone, you have to know the number of the person, you get a voicemail, which they ignore. To think you can pick up the phone and talk to a client direct is a total fallacy. But you can use social, any time of the day and the big difference, your clients connected with you…They gave you permission to be part of their digital life.
In the last 5 years most businesses, have approached Social Media from a tactical point of view. Each department, Sales, Human Resources (HR), Customer Experience (CX), Marketing etc have had their own siloed team and the order of the day has been to tactically post, chasing likes and followers.
Whilst most business have been playing with Social media for years and haven't noticed it has grown up, from a tactical plaything to a global phenomenon. That growth means that as well as changing society globally, it’s changed commerce. Business leaders like us are waking up and not viewing social media tactical, but strategic.
The fact is, Social Media strategy is crucial, it is a Boardroom issue.
Some questions for you:
1. What are you going to do to set yourself apart from your competition?
2. How will you engage with your prospects in a world when you cannot reach them on the telephone, email or shows?
3. Without face-to-face meetings, how will you build the depth of relationship you once had?
4. What is it that you can do differently in the current climate?
5. With pipeline going soft you are going to need to prospect with more efficiency, what methods could you learn to employ to help you?
6. Prospecting to people who are themselves worried will need sensitivity, this will need a change of tack. How will you do this?
7. With all of the lead generation that would have come though the conferences and paid media, now not taking place, how will you back fill this?
8. Your prospects and customers are going to look for empathy in connection in these troubled times how can you show this and not just be touting sales literature?
9. How are you going to enable yours sales force in this virtual world?
You don't have to take my word for it...check the data.
It’s time to evolve and become the team that will take your business into 2021 stronger and ready to take advantage of how it all works now...
This can seem daunting, but you are not alone in this, we are here to work with you.
Thanks to Eric for this great insight and a graphical tale of how business works today. I'm sorry to say that "just one more call" or "sending another batch of emails" just isn't going to cut it in the world today.
For those still hoping that if we can just get through the next 8 weeks and it will be all back to normal in January. This is what Uğur Şahin, said. Who's he? He's the chief executive of BioNTech, the Pfizer company that announced the vaccine and is the Chief Scientist behind the research recently said to the Guardian newspaper.
“The bigger impact will [not] happen until summer. The summer will help us anyway because the infection rate will go down. What is absolutely essential is that we get a high vaccination rate until or before autumn, winter next year."
So even the people that are heading up the vaccine think that 2021 will be the same as 2020.
Where Do We Go From Here?
Just give me, or one of the DLA Ignite team and hour of your time and we can walk you through what we are doing for other companies. No hard sell, just take you through what other companies are doing to transform.
In the face of a global health and economic crisis, many traditional companies have suffered tremendous losses, and some have shuttered their doors. Those that heavily rely on physical capital (for example, stores, goods) and human capital (for example, services) were already vulnerable in economic downturns. The pandemic has exacerbated the lack of resilience in these business models, which have struggled to compete against digitally centric companies that can leverage data and machine learning to create valuable insights, intelligence, and capabilities across the organization.