Manufacturers and distributors finally using IIoT and AI to lift sales and productivity
There are sales data metrics which are finally driving behaviour among manufacturers and distributors far beyond the plant floor and warehouse fulfillment operations. Knowing that it costs five times more to acquire a new customer than sell to an existing customer, the need for AI and IIoT driven data about these current customers is greater than ever before.
It does not stop with that factor; the probability of closing a sale with an existing customer is 60 – 70% greater than a new customer, where the close rate is merely 5 – 20%. Ask any sales rep and they will report that sales can be improved by minimising the time spent on administrative and reporting tasks, says Barrett Thompson of Zilliant.
All B2B companies strive to achieve top and bottom-line success every quarter which requires a strong team of sales reps that can consistently meet or exceed quota. That objective has become increasingly challenging in a complex marketplace with hundreds or thousands of products, with sales reps responsible for managing numerous accounts.
Many organisations rely on the more experienced or high-performing sales reps, or “A” players to make their numbers. These reps have the talent, knowledge, and experience to sell profitably every quarter, even when challenged with a large book of business and complexity in the market. They often have a long history at one company, which gives them a deep understanding of the products and customers, leading to a higher level of efficiency and better outcomes in the field. These superstar sales reps are also aging out of the workforce at an alarmingly rapid pace.
The result for most complex manufacturers, discrete and engineer-to-order, or build-to-order (BTO) distributors, are sales teams consisting of mainly of “B” and “C” players with just a handful of “A” players. If all the B and C players sold as profitably as the A players, the impact on a companies’ revenue would be significant.
As the more experienced sales reps retire and salespeople become more transient, B2B companies are wisely and finally investing in technology solutions that improve sales performance across sales teams regardless of experience.
AI-enabled solution that delivers sales intelligence to drive revenue
Using an AI-enriched solution that delivers unmatched sales guidance, sales reps can achieve the full economic potential of every existing customer relationship. Only when manufacturers and distributors deliver prescriptive sales intelligence on optimal product mix, pricing, and market demand (by applying AI and machine learning techniques to historical and ongoing data), are sales reps able to maximise customer lifetime value. This sales intelligence can be delivered directly to sales reps within existing workflows, including CRM, and eCommerce applications.
Experienced sales reps, even the very best, cannot keep up in complex business environments and when sales reps manage a large number of customer accounts; staying ahead of customer churn is virtually impossible for sales given the sheer volume of accounts and products.
AI guarantees that even if a small percentage of customer churn is recovered, it makes the difference between a flat year and a profitable year. Prescriptive sales intelligence looks at purchase patterns across all customers, and flags when a customer begins to defect, even on just one product, enabling sales reps to quickly redirect efforts.
This AI-based data also helps sales reps understand which additional products to sell to accounts. This is similar to consumer eCommerce websites, such as Amazon, that recommend products based on browsing or buying patterns. B2B customers also exhibit behaviours and purchase patterns that reveal when they are ripe for cross-selling and upselling.
Improve sales productivity
Another way to improve sales performance and productivity is to increase actual selling time. There is strong evidence that correlates selling time with quota achievement. An increase of just a few percentage points in selling time across an entire sales force leads to higher overall profitability for the sales organisation and equates to additional sales headcount, at no additional expense.
When manufacturing and distribution sales teams are underperforming, many companies implement more sales processes, increase the number of reports sales reps, and managers need to review and look to sales force automation (SFA) systems to improve sales performance and productivity. The underlying assumption is that more visibility into sales team activities will help identify areas for improvement and ultimately drive better performance, but these solutions often exacerbate the problem, creating more administrative and reporting tasks for reps and managers.
More often than not, sales reps spend more time entering information into their SFA systems than deriving useful information from it to close more sales at a faster rate.
Sales leaders using AI solutions minimise activities that do not directly contribute to revenue generation. While CRM, SFA and business intelligence reports are important to help manage sales performance, they do not generate customer insight, monitor transactional impacts, or predict and prescribe action.
Leverage AI to pair sales insights to sales actions
A better approach for sales leaders is to leverage solutions that use artificial intelligence technologies to pair insights with action. Ultimately, these tactics increase the average amount of time sales reps spend selling and identify the best opportunities for sales growth.
Next step: Watch how AI fuels sales for manufacturers
The author of this blog is Barrett Thompson of Zilliant.
About the author:
Barrett Thompson, GM of Commercial Excellence leading Zilliant’s Business Solutions Consultant team aligning Zilliant solutions to customer needs. Over the past three decades, he has built and delivered optimisation and pricing solutions to Fortune 500 businesses in diverse B2B manufacturing sectors.