The dawn of the 21st century business model
It’s finally time for technology to drive sales growth
For decades, the sales and marketing technology stack has been a universe of technology assets revolving around a central sales recording system, namely CRM. After 30 years, the return on the sale of assets – people, data, technology and content – is still below managers’ expectations, and even further below their potential to create value for the company, regardless of the financially sound measure. Deploying 21st century innovations in a 20th century management framework has resulted in unsatisfactory return on assets, return on investment, sales productivity and performance for sales and marketing managers – and indecipherable for CEOs and CFOs in most cases.
But these technologies are not the problem. In general, they work. In many cases very well. On the contrary, most of the headwinds that hold back the immense promise of technology to fuel and accelerate growth involve failures in leadership, measurement, teamwork, incentives, and change management.
We have reached the point where the proliferation of sales and marketing technology tools and the maturing of the growth technology stack have made the traditional approaches used by most organizations to manage and measure these assets unsustainable. The number of tools in the modern sales system has multiplied. Most companies have a solid set of dozens of sales support infrastructures and customer-centric channel technology solutions in their portfolio. In fact, two-thirds of what most of us still call the sales and marketing mix is actually an infrastructure of digital channels and the resources (content, data scientists, bloggers, and promotions) needed to power them. And the available universe of growth technologies has expanded to include thousands of sales infrastructures and customer-centric technology solutions (exceeding 8,000 point solutions and even more apps and algorithms).
This is a problem because many organizations still manage these important and critical growth assets tactically in functional silos. This stems from how most companies have traditionally bought, managed and measured their growth technology assets. The fragmented and tactical management of these expensive growth assets is one of the main reasons why so many organizations struggle to “connect the dots” in their growth technology portfolios in ways that create value. Look at the evidence:
Three decades after the advent of CRM, most enterprise CRM implementations are characterized by lower than acceptable ROI, less than satisfactory user adoption, and a lot of unrealized potential. Sales management association.
· 25 years after the advent of e-commerce, only 12% of B2B sales are made through digital channels.
· A decade on from the start of the big data era – the impact of analytics on decision-making and corporate financial performance remains virtually unchanged over the past eight years, according to a study by the Duke Fuqua School of Business.
· Adoption rate of other highly touted and ready-to-deploy technologies – such as 5G communications, augmented reality and artificial intelligence – stay low because these technologies require leadership commitment and change management to realize their potential to accelerate growth, enable virtual selling and differentiate the customer experience.
This is about to change drastically and quickly. A mix of customer, demographic, financial and market forces will finally force companies to take the digital transformation of sales, marketing and services seriously. Businesses are hit by a wave of disruption that is accelerating the transformation of the business model in ways that dramatically improve sales performance. These include: a health crisis, massive changes in demographics, channels and purchasing behavior, an economic recession fueled for the first time by declining customer demand and the ability to access those customers . Together, they are creating a “perfect storm” of six macro-trends that will force the emergence of a 21st century business model that is digital, data-driven and more measurable.
THE SIX FORCES TRANSFORMING THE BUSINESS MODEL
These forces will force business leaders to finally transform their business models and lead to a golden age of sales technology. This will involve a major shift from a physical sales infrastructure to a digital, data-driven sales infrastructure that will drive a range of critical but underutilized growth technologies from ‘the trough of desperation’ to mainstream adoption, including digital commerce, sales activation and advanced analytics. .
You can see the contours of the 21st century business model manifesting in the form of significant changes in investing and buying behavior over the past 120 days. In an age where buyers and sellers are cutting discretionary spending to match reductions in customer demand and access, they are shifting resources and spending to digital, data-driven and virtual sales channels.
More than 80% of companies are increasing their investments in digital technologies that improve customer experience and coverage according to an analysis of the Wharton Business School;
· Analytical budgets universally expected to grow at a rate greater than 50% to represent 9.5% of marketing budgets;
The number of calls to collaboration platforms has grown more than 30-fold since before the pandemic – to over 10 billion call minutes per day across all platforms – according to recent revenue announcements from both Microsoft and Zoom;
The number of organizations reconfiguring their office space, selling overheads and business models to allow work from home or from anywhere has quintupled from just over 12% at the end of 2019 To two thirds of organizations today;
Sales through digital and e-commerce channels increased across all product categories over the past two sales quarters, with most buying agents spending more on B2B marketplaces and Target, Alibaba Group, and Walmart report record sales quarters during the pandemic fueled by sales through online channels and marketplaces;
The vast majority (81%) of marketing managers see the pandemic-induced recession as a burning platform to gain support from businesses to redefine the customer experience in virtual and digital channels – which they are trying to do. have been doing for years, according to the 21st Study of the business model of the century by the Revenue Enablement Institute.
Ultimately, this new business model will manifest itself in a complete overhaul of the sales and marketing technology stack. A new report from the Revenue Enablement Institute predicts that a new generation of leaders will stand out for the way they make their sales technologies work to support their processes and create value. They will assemble the building blocks of their technology stacks into technology ecosystems that offer the best opportunities to generate higher returns on their selling assets to increase sales, profits and business value.
To help business leaders see the opportunity to connect the dots through their unique technology portfolios – the Faculty of the Revenue Enablement Institute has proposed a new framework – the revenue activation ecosystem. It is designed to help business leaders visualize and unlock the potential of their large investments in sales and marketing technologies and advanced analytics to accelerate revenue, increase profits, and create value for the business. . This simple yet comprehensive model provides executives with a roadmap to rationally reconfigure their top-down sales and marketing portfolios to ensure they generate value and directly support revenue and profit generation.
We’re already seeing organizations connecting their growth assets to the five blue boxes that create and capture value. Specifically, we see growth leaders actively “weaving together” the different elements of their technology portfolios to achieve better returns on their human, technological and data resources in three ecosystems – or federations – with the greatest creative potential. valuable :
1. They focus their technology portfolios to assemble digital sales platforms that automate, simplify and accelerate sales by addressing key “hot spots” in the sales process.
2. They bring together federations of data-driven algorithmic sales technologies that leverage advanced analytics and sales AI to dramatically improve the visibility, speed, engagement, and productivity of sales and marketing resources.
3. And they are integrate learning and development platforms with sales assistance and analysis to create a closed-loop system of training, reinforcement, measurement and improvement.
Other combinations or technology federations will emerge, but these three sales technology federations will immediately bring very big returns for two reasons. First, they will take advantage of existing and underperforming human, technological and data resources. Second, they will link those underperforming data and technology assets to value by measurably improving resource allocation, channel economics, seller performance, account health, and value-based performance metrics. .