Fact-Based Selling: The Starting Point for Joint Business Planning

Posted in category: Strategic Selling

Joint Business PlanningIn last week’s blog, I talked about the need for successful sales teams to move to a more strategic and fact-based approach to their business, both to uncover development opportunities as well as combat potential weaknesses through joint business planning (JBP).  I also provided a link to our downloadable “Collaborative Relationship Continuum” model, which helps sales organizations to define their current situation with key retailers, including the tier at which they are at with each of their retailers, and some thought about where they would like to be with this retailer in the future, including:

  1. Tier 1. Low Collaboration. Fact-Based Selling Approach (The Fundamentals)
  2. Tier 2. Medium Collaboration. Strategic Selling Approach (The Analytics)
  3. Tier 3. High Collaboration. Collaborative Selling Approach (The Big Picture)

The “Fact-Based Selling Approach” is the first tier in this continuum.  Every key account manager should have this foundational understanding, regardless of what retailer(s) they call on.  Gone are the days where the category management team is the only group who understands data and basic data analysis. This knowledge arms the sales team with a strategic and fact-based focus in their day-to-day business, ultimately giving competitive advantage through a value-added selling approach.  Below are the key components required for a fact-based selling approach.

Key Components to Fact-Based Selling:

Fact-Based Selling

  • Category Management Overview:  Fact-based selling starts with a holistic understanding of category management – that big picture perspective that gives an understanding of how this retailer-owned process works.  By better understanding the category management process, sales teams can better understand their retailer, which is a key requirement in any collaborative selling endeavors.
  • Retailer Strategy:  A retailer’s corporate strategies drive all components of the category management process for the retailer, ensuring that all of the retailer’s departments are working towards a united and consistent strategy.  Key account managers need to be retailer-centric, and know as much as possible about their retailer, including their retail formats, target consumer, competitive environment and private label positioning.  By understanding their overall strategies (or lack thereof), sales teams can recommend solutions that align to their retailer’s overall strategies.
  • Understanding and Using Data:  Before using data in fact-based selling, knowledge of general tips when using data, as well as how key category management data sources are derived (including their strengths & watchouts) is critical to understand. At the bottom of this blog you can find a link to a complementary download of some tips on using data sources to reach a higher standard with your fact-based selling. 
  • Without this knowledge, it’s difficult to explain variations in data, determine the best data source to use, or know how to properly work with different types of numbers.  It’s this gap in knowledge that often makes it difficult for  sales people to feel comfortable talking about or presenting data (and may even create an inner “fear” of data based on past experiences).  The key category management data sources include retail scanned sales data (otherwise known as POS data), market syndicated data, and consumer panel data.
  • Completing a Category Assessment:  After gaining a solid understanding of the data sources, it is important to learn how interpret basic data sets (from retail scanned sales and market data).  Different data measures can be used to complement each other, and make it easier for you to interpret the numbers.  For example, “% change vs year ago”, which is obviously a common measure, is one that should not be used in isolation when analyzing the business, because it’s easy to get a large percent change on a small base, plus you may not consider that some segments are much smaller in size.  Absolute dollar sales is a data measure allows you to understand what segments are driving category results from an absolute dollar amount, and is a great measure to combine with the % growth rates for a much better understanding of category and segment performance.  Some other important measures for sales teams to understand include All Commodity Volume (ACV), Index vs ACV, and Volume Opportunity Gap.
  • Category Tactics and Analytics:  Once the data sources are better understood, it’s important to be able to turn the insights derived from the category assessment into action.  The action can be assessed through a look at the category tactics – price, promotion, product and placement (otherwise known as the 4 P’s).  By understanding changes that have happened in each of the tactics – for example, changes in promotional support, average price, shelf space and # of items – sales teams can determine what tactics drove overall category and segment results up or down.

PowerPoint Presentation Tips

  • Building PowerPoint and Presentation Skills:  Most businesses require individuals to use PowerPoint, primarily to create or edit presentations, but few provide training (for some reason it seems to be so intuitive that folks don’t think they need training, so don’t demand it).  A poorly laid out, or esthetically unpleasing presentation, can turn great content into a “not so great” presentation.  Learning some important elements of PowerPoint can not only save time, but can turn the look of a presentation from “good” to “great”.  There are some rules associated with PowerPoint slides that can have a profound impact on an audience when they are viewing a presentation (refer to the diagram to the left). Also, ensuring that there is logic and flow in the presentation is equally as important as the esthetics, using the following steps in a sales presentation:  1) Summarize the Situation; 2) State the Idea; 3) Explain How It Works; 4) Summarize the Key Points; and 5) Suggest Next Steps.   Finally, there needs to be time set aside to practice the presentation more than a few hours before making the sales call at the retailer.
  • Fact-Based Selling:  The previous 6 components set sales teams up for success to develop a compelling, fact-based presentation for their retailers.  A fact-based approach can be used to help establish credibility and a common ground in the summary of the situation (the first step in the sales model above).  The summary should consider the retailer’s current conditions, needs, limitations and/or opportunities, which need to tie in with the overall purpose of the presentation.   It is where the retailer’s interest is generated, and leads to the statement of the idea.  Data can be used in this first step to establish credibility and a common ground in the summary of the situation, to show your retailer that you understand their current situation.  The other steps of the sales presentation flow from the fact-based “Summary of the Situation”, to answer the question “now what?”

By focusing on the areas above (which are also some key elements of category management), sales teams will move to a more “fact-based selling” approach with their retailers.  They will be able to identify the biggest areas of opportunity for the retailer based on data, and based on their strong understanding of the retailer’s needs and what they are trying to accomplish.  It will help move from relationship-only selling to an environment to an added-value, more collaborative sales approach that results in win-win solutions for the supplier and retailer.  How to get your sales team to that next level?  Invest in some training that will help move them to a more fact-based approach!

Next week’s blog will focus on moving from fact-based selling to an even more strategic selling approach, which is a requirement for more sophisticated retailers who demand more from their vendor partners.

Click here for your complementary download of “Tips For Effectively Using Data”


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