From Specialists to Generalists: How to Monetise Servitization and Complex Product Portfolios
There’s little doubt that sales at manufacturing companies are becoming more complex. Product portfolios are broader, and service contracts are more common, not to mention the impact of new technologies like 3D printing, the IIoT and Industry 4.0. As such, Sales teams are having to be trained on increasingly diverse portfolio sales including value-added services.
In parallel, contracts including a service element, such as repair or AI-enabled insights, are becoming more common as servitization of manufacturing is embraced. Compared to a ‘simple’ product sell, these multi-year deals provide manufacturers not only increased revenue streams but also better margins. At the same time, Sales deals are coming under more scrutiny from buyer stakeholders, with more teams involved in each purchase. According to our own research, there are now more than five people involved in almost a quarter of all B2B purchases, with some enterprise deals involving twenty people or more.
With all of this in mind, making sure that Sales teams are effectively equipped for their roles – not least of all, making sure that they’re also up- and cross-selling to existing customers – is a tough proposition. But if your organisation is to be successful manufacturing industry, alongside your specialists, it’s vital to develop Sales generalists who can see a much bigger picture, spot trends, interconnected aspects of deals and opportunities that others might miss. So, here’s how to ensure you’re not dropping the ball.
1. KYC: Know Your Customer
First and foremost, lack of understanding can severely hamper a deal, so you need to understand how your customers buy. At the very least, what’s important to them, what are their challenges, and are they ahead or behind the competition?
Buying patterns can also vary by size at manufacturing firms; SMEs are agile, flexible, will often experiment with new technologies and usually have relatively straightforward procurement processes. However, large enterprises tend to buy more carefully, because the deals in question are also larger and more expensive. This means that you’ll encounter higher numbers of people involved in the buying process – including procurement teams – as well as longer buying cycles and potentially framework agreements.
For example, according to research, a quarter (24%) of all B2B buyers say that five or more people were involved in their last purchase – and only 8% said that they made a purchase completely on their own. With these kinds of statistics, understanding processes and how customers move through them is vital to preparing your teams to sell.
2. Optimising up and cross-selling
Many Sales staff are constantly looking for new customers and learning about how they buy, but this is a challenge in itself. It’s crucial not to neglect your most important source of revenue: existing customers. Cross-selling new products or advanced services, and up-selling greater contract values can provide faster, easier, more stable revenue than big bids to net new organisations. For example, Virgin Atlantic makes it easy for Executive Assistants to book travel for their teams, but on every page of the process, there’s an upgrade option and extensive information about what extra benefits the options bring.
However, this also needs to map to buying journeys, as well as taking into account the size and scale of your own organisation. For example, a recent Forrester study 68% of B2B buyers prefer to search on their own, prior to contacting a company. This is worth taking into account as new buyers are involved in cross-selling journey.
The evolution of the buyer’s journey
Also, in larger, more mature Sales organisations, customer success teams or account managers will be able to feed back crucial insight about what is and isn’t working for existing clients. By adapting to the modern selling and leveraging customer analytics, a savvy sales generalist will often be able to find innovation, whether it is cross-selling other complementary products or upselling services.
3. Train Effectively
Finally, not all training is created equal, and although you might have the best Sales and marketing content in the country, if salespeople aren’t trained to use it effectively, it’s a wasted effort. So what’s the best way to train?
Practice does indeed make perfect, according to the National Training Laboratories, which established that learning, followed by teaching others results in retaining 90% of training content. This was closely followed by learning and practicing, which results in retaining approximately 75%. Training formats to avoid are lectures (5% information retention) and solo reading (10% information retention).
However, Sales teams in the manufacturing vertical also face a number of cultural challenges. According to our new research, 72% of Sales professionals in the sector admit that they don’t have formal coaching or training. This is a staggering 23% higher than any other sector, and in fact, only 8% of manufacturing Sales professionals have ongoing, continuous training.
With figures like this, it’s crucial for Sales leaders to start thinking about a holistic training programme that will help them to:
- Transform their teams for growth
- Capitalise on servitisation
- Increase their share in an increasingly crowded market
It’s not easy dealing with a rapidly-changing manufacturing landscape, but by taking a few strategic steps, your generalists can focus on the bigger picture, drawing in specialists as and when necessary, adapting and aligning to customers’ needs.
And if you’d like to read more about how Sales leaders can cope with the increasing complexity in the manufacturing sector, check out our white paper.