In the office technology industry I serve, we talk about Machines-in-Field (MIF). Every 3-5 years the leases on these machines expire or the machine wears out. Sales reps “flip the MIF” when they upgrade customers to new equipment.
MIF-flipping plays a critical role. After all, we need to maintain our customer base. However, we also work in a mature market. That means that average selling prices are dropping faster than cost of goods. Each year the delta between sales price and cost gets squeezed a little tighter.
What does that mean?
Companies and sales reps that have historically depended on MIF-flipping will suffer a slow and painful decline.
Some businesses are counteracting the revenue decline by purchasing more MIF to flip. The top line revenue of these businesses look good, but ultimately, these businesses will also feel the pain.
What’s the antidote to the slow decline? You need net-new business.
The problem is that generating net-new business is harder than MIF-flipping.When things are hard, we tend to gravitate back to things that are more comfortable.
Month after month goes by. Every time we flip the calendar, we realize that all we’ve been doing is flipping the MIF. This is a death sentence for a business.
How do you change this? Fully answering this question could fill up a book. Today, I want to consider the cultural aspects.
A Culture Of Prospecting
Does your sales team have a culture of prospecting? Organizations will always gravitate back to their culture.
A sales team with culture of prospecting is not much different than a community of fitness enthusiasts.
Look, if you want to be in shape, you need to go to the gym. The problem is that going to the gym is hard. It’s inconvenient. It takes work. You feel sore afterwards. You need to take a shower. Everything about physical fitness is a hassle.
Fitness enthusiasts know this. They structure their life with discipline and friends to hold them accountable. They create a lifestyle of fitness where going to the gym is not optional–it’s part of who they are. If they miss one day, the know it and get back on track quickly.
Sales prospecting is like going to the gym. It’s inconvenient. It’s hard work. It requires diligent scheduling. And it hurts your ego to hear no 28 times in a row.
As hard as prospecting may be, the simple reality is that just as they are no healthy people without exercise, there are no healthy pipelines without prospecting.
A culture of prospecting acknowledges that prospecting is hard and makes it a priority anyways.
Yesterday, I spoke with some sales leaders that had launched two separate net-new business initiatives in the past three years. After the initial launch, both of the initiatives fizzled out.
Why is that? I don’t think the strategies they were using were necessarily bad. (When it comes to prospecting, anything that generates some activity is better than nothing!) The common denominator between these two failed prospecting programs was a lack of culture change.
To develop a culture of prospecting you need to be intentional and strategic. It requires leadership. It requires coaching and feedback. As I’ve been watching Lisa Dalton, our sales coach at Convergo, I’m seeing how critical it is to combine sales training with coaching and culture change.
A healthy sales culture celebrates and rewards prospecting. They make it a priority. It’s hard to accomplish but critical for success.
A Mindset of Marketing
Today’s buyers are more skeptical than ever. They go online to find answers. They ask their friends for references.
If you want net-new business, you need a consistent strategy to share helpful information with potential buyers. You need to earn their trust by proving your value.
Whether you like it or not, this is how people buy. They vet companies and sales reps online. You need to invest in the digital presence of your company and your sales reps.
Some of this is very measurable. Some of it is not. For the part that’s not, you have to go with your gut and stick it out.
A mindset of marketing focuses on continuous improvement. Websites are never done. They are continually improved with better content and more calls-to-action. Search placement is never static. Social media has a short shelf life. Online references go stale and you need more.
All of these are important. All of these take continuous work by a team of people who know what they’re doing. This is hard.
Ultimately, the question of net-new business is not for the sales team. The question of net-new is for leaders: Will you lead?
Once you’ve answered that question (we hope you said yes!), ask yourself the following:
- What do you expect?
- What are you willing to champion — and even do yourself?
- What are you going to reward?
- What are you going measure?
- What systems will you provide to make prospecting more efficient and effective?
- What kind of attention and budget will you dedicate to marketing from now on?
Flipping MIF is like trying to live off of your savings account long term – at some point, the money will dwindle. If you don’t want that to happen, you need to get to work. Build a culture of prospecting and a mindset of marketing.
*This article originally appeared on LinkedIn Pulse on January 25, 2019.