Selling through B2B Reseller Channels

In the B2B market establishing the correct sales channels can be just as important as having the right products. Enough companies have foundered for want of sales brought on by a lack of distribution. One of the ways to create a conduit for effective sales of your product is through VARs (Value Added Resellers).

VARs can be a great tool if used in the right situation. They can also be a distraction and a nightmare of unfulfilled potential if they are not managed.

So what are the main Advantages of VARs?

1. Low upfront cost. Theoretically you only pay them when they sell something, so you are not bearing the costs of salaries and overheads, so the costs of hiring and training staff in the initial stages are no borne by your business.
   
   
2. Scalable.  If your market grows dramatically (hopefully), you don’t have to go and find sales force in a hurry. On the other hand, a shrinking market for whatever reason means that you don’t have to deal with lay-offs..

3. Existing Relationships. If they are established then they already have customers who they can sell your product to, so growth in the initial stages has the potential to be fast.

The disadvantages, however, can be taxing to say the least.

1. Focus. Or lack thereof. They sell other products and trying to get them to concentrate on yours and yours alone, especially in the early stages, can be difficult. The piece of paper you signed with them isn’t really worth anything unless you get them to push your product.

2. Information Sharing. Trying to get a VAR to open up and tell you about their specific customers is not easy. It takes years to build up that level of trust and even then the sharing that you may get can only be cursory. Their value is in the relationships and subsequent sales that they bring so they will keep this information sacred. This can often mean that you don’t know who is buying your product and why and this can have a detrimental effect on your marketing and product development for the future.

3. Conflict in the Sales Channel. The more VARs you have, the more likely they will collide. You then become the arbiter, which is never a good place to be, although it is commonplace so there are methods to deal with it; this can be overcome with guaranteed and protected territories but that creates its own problems.

4. Competitive Products. A big one. If the VAR is selling into a vertical and have a specialty product focus they may often have competitive product offerings. If you are the last to sell through a particular VAR, then you have an uphill battle ahead of you. If you are the incumbent, then you have to be constantly concerned with new offerings coming into play and distracting the VARs sales teams.

There are distinct pros and cons to selling through VAR channels. It’s the disadvantages you have to concern yourself with though. You have to get their interest and keep it. And there are only two ways to do this – Hearts and Minds, and Money.

Money because that’s what they are in this for. But be aware that there are two layers to this. Money for the VAR as a Business (“what are the margins for the company?”) and money for the VARs sales Reps (“What’s in it for me?”). Don’t get them confused. I have successfully sold my product to a company and got a commitment and not shifted a single unit because I don’t focus on the sales teams as individuals. Spiff programs come in handy at this point.

Hearts and Minds. You need to keep pestering the sales teams with training, marketing materials and constant contact, especially in the early days to keep them interested in selling your products. Typically a VAR salesman will take the easiest possible route to success and unless you have trained them well and continuously, they will shy away from promoting a product they are not confident about.

VARs are not a sales channel that you can set up and then sit back and wait for orders. It just won’t happen. Just like your own sales team, they require cultivation and motivation to keep them interested in your product. They generally only get excited if they see that your product is really selling. So put the time investment into them and if you do it correctly, it will pay off.

Planning your Trade Show Presence (Part 2)

So you have the booth all planned and built, equipment is there all polished up and literature neatly stacked on racks, carpets clean and rolling presentations playing in the background. Now what? How do you make sure that you get the most out of your tradeshow presence that you have spent so much time and money on?

Well here’s some practical advice from many years of working tradeshows across the world.

As a marketing manager don’t be afraid to be a tyrant. After all, this is the culmination of a lot of work and for many companies is the focus of the entire years marketing efforts and the biggest single cost on the budget so you want to get it right.

It has to be choreographed so feel free to make sure that all the sales ‘dancers’ understand their roles in advance and then monitor them and keep them in tune throughout the show. Your job at this stage stops only when the booth gets dismantled.

Briefings

Before you even get to the show, make sure you give all of the attendees a full briefing on times, booth etiquette and the logistics. It helps to pre-warn them all. This is also the time to make sure everyone knows which customers or prospects will be attending and plan accordingly.

Dress Code

I know that a lot of companies in the USA favor the golf shirt approach, but I for one don’t. You have such a short time to make an impression at a show, so do it right. Business suits and ties are the de rigueur at all times. Show the attendees some respect. A side benefit to this is that sales people who buy their own clothes tend to treat them better that company supplied shirts so they end up looking neater. Obviously garish ties or shirts are not acceptable. You will find that most salesmen and women will not object.

Timing

On the first day, you will want all staff at the booth at least one hour before it starts so you have the time to take them through products, logistics and expectations. On the following days, 15 minutes before is acceptable. Late arrivals should not be allowed as it can be disruptive to other staff and attendees.

  

Food and Drink

I have been on enough booths where all the careful planning of a booth has been ruined by a salesman dropping a cup of coffee on a pale carpet. It can destroy the whole look in a heartbeat. Furthermore, eating and drinking on a booth is not conducive to creating a welcoming environment for any possible prospect. So simple rule - no food and no drink on the booth at any point. Obviously this does not apply to attendees.

Furniture

I have had so much pushback on this part over the years but I have always insisted. Either no chairs on the booth, or a strict rule that no booth staff member can use them unless with a prospect. Why? Because it encourages a stand-off approach to getting interest in the company and its products on display. Sales staff should be always on the ‘prowl’. A good set of shoe inserts will help overcome some of the natural pain of standing for 8 hours a day.

Working the Booth

In Europe the approach is different to the States. It is acceptable to sit back as the culture is for interested attendees to approach the sales staff. In the US, it is the opposite so patrolling the perimeter is a mandatory requirement.

Don’t allow salesmen to congregate together and talk amongst themselves. It is off-putting to someone who may be interested. It will happen but as the booth manager you have to play the hard person from time to time and separate them and keep them focused. Making sure they patrol different parts of the booth is a good technique for this.

Taking Leads

This is what a show is all about and in many cases probably the worst. Salesman leave with pockets full of business cards from people who they have talked to and with very little memory the next day of what they spoke to them about.  

Capture the data!

Yes, there are the scanners available which you should always have but you also need a clipboard with a form on it so the printed paper form the scanner and or/business card can be attached together with a summary of the conversation. Put lots of check boxes to speed the process up. After the show, summarize it all and disseminate. DO NOT allow salesmen to disappear with the information.

Let’s put this into perspective, if a show costs you $100,000, and you get 200 leads then each lead has cost you $500. Be sensible.

Final warning – if you have a scanner with a USB thumb drive in it, take it out each night and back it up. I have also heard of competitors coming along after the show and copying these; rare but not unheard of.

Competitors

A note on competitors coming to your booth. Personally I have no problem with this as long as they are circumspect about it and sensitive to leaving if a prospect appears. They can always get hold of your literature so no problem in giving them some. Obviously you expect the same courtesy on their booth.

Your trade show presence is an important part of your marketing activities for the year so make sure you get it right. Prepare before and implement strongly during the event. What you do afterwards with the data and the feedback is the subject of another blog.

Planning your Trade Show Presence (Part 1)

Tradeshows – always the bane of every marketing professional, irrespective of his or her level within the hierarchy of a company. Whisper that perhaps we should reconsider exhibiting at tradeshows and suddenly everybody becomes an expert on why we have to go – “everybody will think we've fallen on bad times”, “that’s where we get our customers from” and “ we've always done that show” are just a few of the objections. We've all heard them a thousand times.

So let’s assume we are going to go to tradeshows. What should we consider in the planning and logistics stages?

Goals and Objectives

Define the goals for your business clearly – what are they? Is it brand awareness, lead generation, a centralized place to show existing customers your products or services? It may be all of the above, but be clear on what you are trying to achieve. If it is qualified lead generation then perhaps a highly focused show is better than a more generalized event where larger numbers are likely to be present. Defining your objectives up front assists greatly in targeting which show and later on in assessing ROI based on upon those goals.

Placement of the Booth

Many of the larger shows will have zones where your product may fit into however loosely. Placing your booth in these areas can be beneficial as you often have motivated and pre-qualified attendees coming specifically to this region to fulfill their needs and solve their problems.

There are some dynamics to the movement of people at a show and often I have found that as attendees come to a show they will bear right (most people are right handed) and circle around the show floor first before delving into the center. Consequently a booth on the edge and to the right tends to get the early traffic, important when “Tradeshow Fatigue” can often set in towards the latter half of the day.

If you can afford it, an island booth gives you so much more display and design space than a booth trapped between others. However you can still make your presence known with a different position if you are creative.

Size

Contrary to many theories, size isn't everything.  The size of the show—measured in attendees and exhibitors—should match your goals but also allow you to maximize your potential. Large trade shows are good for general leads—people who come to your booth just because you are there and so are they. Lead quality doesn't tend to be the highest in this scenario but the quantity may be. (Be aware of this when assessing ROI later). Large shows also can mean that you get lost in the crowd of exhibitors although this can be overcome to a certain extent by driving attendance to your booth ahead of time.

The size of the booth itself can be important, although this can be dictated to a large degree by your budget. I have seen plenty of big booths that have made no impression at all, blending in to the corporate background of Tradeshows. Conversely, small booths have attracted a lot of attention with enough creativity designed in. Of course the size may be dictated in part by what products you are showing. Obviously a machine that is 50 feet long needs the right amount of space to be shown effectively.

Competition

Go to a Mall and you will see many shops selling the same products - the nearness of competitors in one place can be a positive boon for business. This is often referred to as “Co-opetition“. The same goes for Tradeshows. Often the organizers will do this placement deliberately. It can be a good thing especially if you are not the leader in a particular market. Use their marketing dollars to attract qualified leads that will be going to their booth and if you plan it right, will see you as a possible option. You need to understand your competition well so you can counter their messages and separate your products from theirs.

Design

The big one! How do you design a booth that attracts prospects, gets over your messages and qualifies attendees? There are so many companies that will help you with this – for a fee. Don’t try and do this yourself. Get the professionals involved every time. Unless you are a graphic designer, you will design a booth that doesn’t work. However, before discussing anything with a design company make sure you understand what messages and products you are trying to promote. Then make sure that they understand the same.

If you want to stand out, study what other companies are in the vicinity at the show. Look at their corporate branding and colors and if possible see what they have done in previous years. (I always make a point of taking photos of my competition especially at every show I go to). Use this information with your design company to make something different.

Extending Your Reach

If you just rent the space, build your booth and wait for prospects to arrive you will miss out on a few other opportunities to engage customers.

Most shows have conferences built around them. Get on the speaker platform and promote your messages to motivated, interested professionals within your target market. They are at the conference listening to speeches that are relevant to them so they are qualified prospects.

Sponsorship at the show can be a very costly exercise so you should use it with caution. Having your name printed on Lanyards, signs, bags etc. can all look like a good idea but it can eat your marketing budget alive. It is better to have something that you give away on the booth that attendees take with them and carry around. There are many ideas; some that I have used highly successfully that can create a real buzz and that overshadow standard show sponsorship. (Email me and I’ll tell you about them).

Driving Attendance

You’ve booked the space, designed the booth and have the hotel rooms booked. You’ve only just begun. You need to drive attendance from within your own company.

Hopefully you have a database of customers and prospects. In the months before and then the final two weeks (most people don’t even think about the show until a few weeks before they attend), send them all emails letting them know that you will be exhibiting at this show and how to find you. Give them some information on what you will be showing.

Get your sales force involved at an early stage including your distribution network (if you have it) and make sure that they are aware months ahead of the details. Set them goals on getting customers and prospects to the show. Make sure that they schedule meetings with these people at the show if appropriate.

Many trade shows offer the exhibitors the use of the registration list for pre-show and sometimes post-show direct marketing -  of course for a fee.  Four to six weeks before the show, send a postcard or letter to this list, inviting the attendee to stop by your booth and see what you have to offer. This is often a shotgun approach and can be costly in terms of direct mail. Two weeks before send a reminder

Finally find out the list of press and analysts that will be attending the show and have you or your PR people schedule interviews with them, especially if you have an updated strategy or are announcing something new at the show. This is a great opportunity to get in front of several of the key industry influencers in one location.

Cost

The most important part with many companies - how much will it all cost?

You have put together a well-designed booth, prepared materials to distribute, and arranged sales and technical staff to travel to a distant city; the costs for a trade show can rapidly mount.

The cost of a trade show is best measured in ROI. Take into consideration the issues outlined above such as the effect your presence will have on your target audience and determine if there will be a positive return on investment. Return is most often measured in terms of leads generated and sales later closed, but for some trade show exhibitors a goal might be more focused on building the less concrete values of good will and brand awareness.

  

Part 2 to follow - Maximizing the Show