AB Podcast Interview Thompson and Joy (AllBusiness.com’s Chris Bjorklund interviews David Thompson, CEO of Genius.com, and Greg Joy, VP for Sales of Lithium Technologies Inc.)

Chris Bjorklund: You’re listening to the AllBusiness podcast. I’m Chris Bjorklund. If you’re getting this through iTunes and RSS feed or an online streaming media player, you can hear interviews with other experts at AllBusiness.com.

Bjorklund: New and innovative web-based technologies that can help salespeople target their customers more effectively and close deals faster are dramatically changing the roles of sales managers and sales representatives. David Thompson, CEO of Genius.com, joins me today to talk about some of the big changes in this AllBusiness podcast. David, most people are now familiar with the term Web 2.0. It’s commonly used and understood. But what is Sales 2.0? That seems to be a brand-new concept. So who coined it? When was it brought into the lexicon and what does it actually mean?

David Thompson: Well, the first time I uttered the words “Sales 2.0”--and I certainly don’t know if I was the first. But perhaps among the first was over breakfast with Geoffrey Moore, the author of Crossing the Chasm. He and I were having breakfast and we were just having a brainstorm about how profoundly the web has changed everything certainly at a consumer level and my perspective in that conversation was as a marketing and salesperson, how much it’s changed the way people sell and the way people accord each other and connect and close deals online and we got very excited about this idea and we started calling it ‘Sales 2.0” as a way to describe how profoundly the web has changed the way people sell.

Bjorklund: So traditional sales, well, that’s pretty much over?

Thompson: No, no, it’s really about options. The web just gives you so many more ways to sell online and so they’re the obvious ways that most people know and love already which is e-commerce. You know, you go on Amazon, you buy a book, you do a search on Google, you buy something on eBay--all of that is fairly well understood. What we designed Sales 2.0 to describe was how buyers and sellers can meet online, they can meet through, you know, web conferencing, for example, or they can chat or they can arrive at a website through an online ad and then have an interaction on that website that leads to a sale. But the main point is that it’s a one-to-one relationship. It’s mediated through the web and that doesn’t replace face-to-face meetings. It just gives selling organizations and salespeople more options to interact and help customers buy.

Bjorklund: Well, let’s talk about the life of the salesperson in Sales 1.0 versus 2.0. And you talk to us about some specific...

Thompson: Sure, sure. Well, in a 1.0 world, you just assume that you were going to get on a plane, you know, you were going to target a customer, with a high-priced product and presume that that customer had a big budget, they can meet the economics of all of that work. And that was, you know, a kind of a classic enterprise sale and that could be selling software, it could be selling, you know, big manufacturing goods, that type of thing, you got to look the guy in the eye and close a million-dollar deal and whatever. And the problem with that model is it left a lot of money on the table because there are many, many businesses that want to buy products that are less expensive but then that makes it really hard to justify putting a salesperson on a plane to go after that deal. And that’s what Sales 2.0 addresses is that ability to meet your customer online, to be able to pitch them online and close them online potentially too, all through, you know, services or like web conferencing and like online chat and the ability to target your customer with special offers through websites.

Bjorklund: I think that I heard someone say that your outside salesperson is now inside.

Thompson: Well, that is true in many instances. It really just depends on the economics and if you’re talking about going after small and medium businesses which has kind of been the Holy Grail for years. For years, big businesses struggled with how do we target smaller businesses and smaller businesses struggled with how do we target bigger businesses and how can make ourselves look bigger and the good news is, the web and Sales 2.0 helps with both of those scenarios, because it makes it so much cheaper to be at your desk, and you know, have five sales interactions with five different customers in a five different geographies all through the web rather than having to go physically to each of those customers.

Bjorklund: Let me introduce our second guest now. Greg Joy is on the line. He is vice president of sales for a company called Lithium. Greg, you’ve been in sales--I think you said more than 20 years. How are you doing your job differently today than you were, let’s say, in 1995?

Greg Joy: Well, it’s changed quite a bit. In the early days, we’ll say it’s Sales 1.0 days, driving around, everything was onsite, you’re on the planes all the time, you know, your pay phone was the biggest friend. You had more than once people that have as much experience or history as I do in the sales process all remember some time when you had to call a customer and the only pay phone was out in the pouring rain and you had to make a phone call.

Bjorklund: Pay phones? Oh my word!

Joy: That’s right. Way back then and you used mail for everything and fax and so on. And then maybe the next step was say, Sales 1.5 if we could, and that’s when you had the cellphone and the cellphone had certainly made things much more easier and you had email and instead of having to mail things to individuals, you could actually just attach them as documents and made it so much easier. But now, with Sales 2.0, we’ve added the concept of webcast and I agree with David completely in the sense that it makes it so much easier for a company to go out and touch the customer and actually for a smaller company not only does it make it easy to be more cost-effective but it extends your reach. For instance, a small U.S. company can now easily demonstrate products, specifically software products to companies around the world, and whereas before, they would have had to put somebody on the plane to do so. So I guess the bottom line is that certainly we are doing many more things from the headquarters. The good news is as far as my wife is concerned, I’m home a lot more. The bad news is for her is that I don’t have quite as many frequent-flyer miles, which is then she can’t go with me on vacation.

Bjorklund: I thought you were going to say that the bad news was that you’re home a lot more.

Joy: Yeah.

Thompson: You know, I think the web conferencing vendors are going to have to deal with that. They’re going to have to have frequent-flyer miles every time you get online and meet.

Joy: That’s right.

Bjorklund: That’s a great idea. Well what about cold calling? I’d like both of you to weigh in on this. I mean, some are saying it’s asking the question anyway, is cold calling dead? Greg, do you still have to make cold calls?

Joy: Well absolutely, in the sense that you still have to have visibility. And for a small company that may be ramping up its marketing department, it may not have quite the company name yet out there in the industry you still have to make cold calls. But the difference is, is now it’s much more instead of just jumping on the customer when you get a prospect, is that you can do different things. You can provide a presentation. You can provide a presentation to many different people from an evaluation committee that are disseminated around the world. It’s much more being able to be more aware of your customer. I mean, there are tools. There are tools like Genius, where you can identify when your customers come to your site and then you can contact them when they’re thinking about you. It’s just a much better approach in terms of dealing with your customers. It’s actually one that I find that our customers like a lot more than actually having a salesperson show up at their door.

Bjorklund: David, would you like to weight in on that?

Thompson: Yes, sure. I mean, I’ll maybe go out on a limb here and I will say that in a Sales 2.0 world the cold calls really should be dead and if you’re making truly cold calls you’re just not taking advantage of what Sales 2.0 has to offer. And you know, Greg mentioned Genius and that’s just the simple ability to target an e-mail campaign at a targeted list of customers that, you know, you might have met at a trade show or gotten off of Jigsaw or something like that and then just see whether or not they’re interested enough to come to your website and that’s just one example. I mean, we also have the marvelous world of Google and search advertising and if a company doesn’t have a search-engine advertising approach to generating leads these days, you know, you’re really missing out, because with those targeted ads you can literally have the buyer knocking at your door asking for help. And that truly does mean the end of the cold call eventually.

Bjorklund: Are there some industries and services where some of these new ways of selling are just not applicable?

Thompson: Well, sure. I mean, look, that reality is if you’re Boeing and you’re selling a 747 or you’re selling a Dreamliner or one of the new airplanes coming out, you’re going to have to have some face-to-face interaction. But the point of Sales 2.0, just to reiterate, it’s about having options, having how and when you interact with your customer. You don’t always have to meet face-to-face but you don’t always have to meet online. You know, I know many companies for example EMC, you know, the great company that did spun VMware, you know, for years, didn’t have any of a channel organization outside of headquarters but all of that interaction with their channels was handled through web conferencing. And now guess what? You know, those companies, both EMC and Vmware, have become so successful that now they’re hiring people to actually go out into the field. But that’s the point. You don’t have to just assume a Sales 1.0 mindset. You have to ask yourself, “Do I need to be in the field? Can I do this in the office? Is it more economical to do it in the office and then when does it become compelling to actually put feet on the street?”

Bjorklund: Now Greg, this question’s for you then as a follow to that. Do you find that the salespeople you’re hiring, you’re in charge of hiring as VP of sales, that you’re looking for a different skillset now?

Joy: Sure.

Bjorklund: And are there more opportunities for people who otherwise maybe would think, “Gee, I’m just not the sales type.”

Joy: Well, I think that’s true. I mean, certainly when we look at individuals now that come in, we look at individuals who are not just the traditional 1.0-type salesperson. We’re not looking for the person who can just go out and close the big deal. With the types of technology, particularly our technology, which is more of a software as a service, we look more for a long-term relationship with our customer. And so instead of the person that can do the big close, what we want to find is the intelligent person that can build the relationship and we see that as a key differentiation from back a number of years ago.

Bjorklund: David, do you agree with--have you seen that too?

Thompson: Yeah. I mean, this is really all about a huge generational shift is what’s going on here. It’s the MySpace generation meets the workplace. It’s the Facebook phenomenon where, you know, kids go to college these days and on the first day they show up, they already know all of their college classmates because they’ve all met through Facebook. And it’s that type of skill, that social networking that takes place online in the personal sphere, is really beginning to move into the online sphere. I’ll just give you an example from my own business. We don’t hire sales reps unless they can demonstrate to us that they can give an effective presentation through WebEx. That’s literally one of the tests you have to take to get a job at Genius. You must be able to show that you know, you know how to use WebEx, you know how to give a presentation on WebEx and, most importantly, you know how to communicate effectively through an online medium not just, you know, shaking hands face-to-face.

Bjorklund: So you don’t have them also go out to dinner with a client and see if they have table manners?

Thompson: Absolutely. You have to do all of that, right? But that’s the point. The point is you need to be able to connect both through the web and in real time, in real life too.

Bjorklund: I want to talk about some of the new software applications that help salespeople become more efficient, at least sort of the general categories. David, can you talk about that?

Thompson: Sure. I mean, just the simplest way to think about it is it really is a variation on the traditional sales funnel. At each stage of the funnel--let’s talk about the highest level, attracting people to your business, attracting people to your website. You know, you have all kinds of ways to do that with technology--you know, obviously like Google advertising to get anonymous visitors. But then you can also do targeted campaigns through emails with things like Jigsaw and Hoovers and Spoke if you’re targeting certain industries and certain companies within certain industries, there’s this very rich data out there on the web that can help you attract qualified customers to your website. Then I say attract and then interact. Once they’re on your website, you want to interact with them and you can use things like web conferencing like WebEx, Genius, our sales Genius products, what you chat with people on the website. But the basic shift there is your website is like your store at that point and the salespeople are in the store literally meeting and greeting and helping people understand your product and help give them better service through that website and then you can even close your customer online with things like EchoSign, it’s this great ability to sign contracts over the web through a product called EchoSign that literally lets you close the deal and guess what? You can do $10,000, $20,000, even $100,000 deals through that simple process of attract, interact and closing all through the web.

Bjorklund: Greg, do you have anything to add?

Joy: No, I agree with David 100 percent and a number of those different tools that he just mentioned, we use every single day. It just is a way of being able to talk to your customers when they’re thinking about you. You know, when your customers--the first thing people do nowadays when they want to find out about new technology, about a product is they go look it up on the web. They go Google it or they go somewhere else and they go directly to your site. When you know those people are on your site and they’re thinking about you and they’re interested in finding out more information, that’s absolutely the best time to interact with them.

Bjorklund: Now, speaking of the--oh, go ahead.

Thompson: And Chris, I might just jump in and Greg might be a little modest here but Lithium’s products are really good for this too because it helps you create a community. You can have a support community around all your customers helping each other and giving each other tips and tricks with the Lithium technology and that’s all web-based too. So this notion of creating a customer community on your website that then gives referrals to new customers and also shows how rich the usage scenarios are of your product is another great way to not only keep customers loyal but to give a new reference to new customers, again all through the web with something like Lithium.

Bjorklund: Now I want to talk about the downside from the customer point of view for a minute. I’m having to search for a plumber online and signed up for one of these things where they’re going to send your job bid out to a number of people and they’re all going to get these leads are going to be passed on to qualified plumbers. And after I fill out the form--well, maybe it was a painter but anyway--I filled out the form and I barely closed the window and my phone was ringing. And then it spooked me a little bit. Now this is, you know, in my home and all, so maybe I’d feel differently if this was in a business setting. But isn’t that one of the, you know, isn’t there a caveat there about stalking customers?

Thompson: Well, yeah, I think that the case that you just gave, Chris, it really goes to show that you need to be sensitive as a salesperson. This is not about you closing a deal. I mean, ultimately it is but to get there, it’s about you helping your customer and knowing the right touch and the right timing and the right approach with the customer online, it’s absolutely critical because, yes, people can get spooked if you’re too aggressive with them. But, you know, that’s true in the real world too and that’s something that, you know, you go to Nordstrom and, you know, there are good sales clerks and there are bad sales clerks at the Nordstrom and generally Nordstrom does it very well. But if you approach too aggressively, you might get pushed back and so that’s part of the art of selling that carries over online as well.

Bjorklund: Greg, how do you advise your salespeople on this issue?

Joy: Well, we want to be responsive but we don’t want to be considered in the area, as you were saying, the pouncing-type of things. What we’d rather do it and I mentioned before is that we’re a Genius customer and if we get, if we contact the customer, we can tell when they’re actually coming onto our site. And when that actually happens we can contact them again saying, “I’m just following up and what we’d like to do is see if we can provide any additional information.” The person is obviously looking for information on your site and so it’s usually, you know, it’s like, “Wow, it’s a perfect time.” And so what we have found that appropriate responsiveness, as David was saying, kind of Nordstrom as model, where people are not immediately coming up to you but they’re waiting until you require a little bit of information and then they’re right there. Responsiveness is more important obviously than to give the perception that you’re being stalked.

Bjorklund: Now, when it comes to being a small, I’m thinking like a small-business owner here and hearing you all, and I’m thinking, “Wow, this is kind of overwhelming, all this technology. What should I look at? What should I buy? What if I get too much data? What if I get data that’s unusable?” These are some pitfalls obviously. David, how do you suggest people get started on this? At least how they should begin thinking about sorting through what’s out there.

Thompson: Yeah, well look. It all starts with your website. And, you know, some businesses don’t even need a website. And if you don’t need a website then you don’t need Sales 2.0. But I would say 99 percent of businesses, whether you’re very small or very large, can benefit from having a website. And that’s really where you have to start thinking about if the Sales 2.0 mode is to not think about your website, it’s just information but as a live environment, as a store where you’re going to be interacting with customers and you take it one step at a time. Right? You know, you get your domain, you get your website and then you figure out what is the best way for your website to serve your business. And I’ll give you an example. We have a customer that I just love in New York City. They’re Petite Peton and they sell dancing shoes to celebrities and it’s a physical store--like, Beyonce shops there for her, you know, latest MTV-video shoes that she’s going to wear, right? So it’s a very elite clientele. They started collecting all the email addresses of all of their best clients and guess what? They used Genius to start inviting those clients to their website to buy more shoes even when they weren’t physically in the store. And so that was just a very smart, easy way for them to use Sales 2.0 to increase their revenues. It’s like saying, “OK, we’ve a physical store, I’m just going to add on my webstore and then I’m going to do a little communicating with my customers, get them to the website and give them a special pitch for those very special customers.”

Bjorklund: What an excellent example. Now, you talked in your book, Sales 2.0 for Dummies, your reference edition, your reference guide. But hasn’t that always been the case that sales and marketing, even in a traditional way, abandoned working in tandem?

Thompson: That is only a theory.

Bjorklund: OK.

Thompson: And I can tell you, as a marketing guy, that too often, especially in larger organizations, sales and marketing get out of alignment and there’s a lot of, you know, bickering back and forth and, oh, you know, “There’re not enough leads.” Or, “These leads are terrible.” Or, “You’re not following up on the leads,” and all of these kinds of nonsense that, you know, kind of typified sales and marketing in a larger organization. And the reality is, with Sales 2.0, you can afford to have that. But the good news is the technology drives the two functions together. So, you know, if you’re running a Goggle ad and in marketing that results in a visit to the website, guess what? That’s a live prospect then and there that both sales and marketing immediately want to be able to respond to when they’re showing buying interest. And so I think that’s the good news that sell-through the other technologies and certainly best practices bring the two groups very naturally and ease a lot of the friction.

Bjorklund: Greg, has that happened in your company, that alignment that David’s referring to?

Joy: Well, I think it’s always--with any sales and marketing organization, they always strive for it to be better. I think we’ve made great moves toward that. You really want to try to have as to cut down the need for cold calling, to drive leads to your site but then be able to react on them on a prompt, responsive, professional manner. Also we have seen, another thing that I think is important--whether it’s a large company or a smaller company--is if you look at, typically, how people find out about something, either they’ll do some research or they’ll ask their friend. And so what we have seen as well, whether in terms of online community, whether it’s our community or anybody else’s, what we’ve seen is that in the Sales 2.0 area, we have found that companies who provide community, who provide a vehicle that they can leverage some of the positive aspects that some customers have used, to also be able to provide almost a positive presales type of environment for other customers. So you’re trying to leverage your customers to actually inform other customers. And so whether or not you actually are providing, you know, specific salespeople to immediately followup which is what you should do, at the very least, what we should provide, what we’re seeing that a lot of companies are providing is a concept of community where users trust users and users will up sell other users and so that combined with the different tools that are out there, with webcasts, with tools like Genius and so on, makes it kind of a whole package that anybody in the new Sales 2.0 era has to evaluate.

Bjorklund: David, before we close, I want to hear from you about what questions should our audience, the small to medium-size business owners be asking themselves to know if they’re keeping up with the competition and some of them may be coming, meaning the competition may be coming Sales 2.0 businesses?

Thompson: I think, again, the most important question and the most important place to start in the Sales 2.0 world is with your website. And if you’re in sales you have to really ask yourself, “Is my website working for me? Am I able to see my best prospects and my best customers when they are on my website? Do I know what messages they are responding to?” For example, if I send them an email, do I know when they’re on my website? If marketing, you know, runs a Google campaign, do I get a report in very close to real time of which of those customers actually signed up to have an interaction with sales. I think that is really the most important question for you to ask yourself. Is my website working for me and, more importantly, am I able to then serve my customers through the web? Am I able to interact with them and help them when they’re ready to buy? Because that’s really what Sales 2.0 is most importantly about that you target customers who are actually interested in your product and you don’t bother the ones who aren’t and that’s how you get rid of the whole cold calling problem.

Bjorklund: Great talking to both of you. Thanks so much, Greg and David, for joining us on the AllBusiness podcast.

Thompson: It’s been my pleasure, Chris.

Joy: Thank you very much.

Bjorklund: David Thompson is CEO of Genius.com and the author of the reference guide Sales 2.0 for Dummies. Greg Joy is vice president of sales for Lithium. Send your comments about this podcast or suggest future guests by writing to podcasts@allbusiness.com. I’m Chris Bjorklund, thanks for listening.