Selling to CIOs is not easy. They are extremely busy and they are inundated with technical sales calls. Nonetheless, those who make a good living selling to CIOs have learned that there are ways to sell to CIOs that are truly effective.
This article is designed to provide good solid advice on selling to CIOs that will help you and your company meet your CIO selling objectives.
Lesson #1: Selling to CIOs Requires Empathy
The most important skill in selling to CIOs is to have empathy for and understanding of their challenges. At the most simplistic level, that's easy. CIOs are no different from you or me. They are driven by self-interest. They have a set of objectives for their IT organization. If they meet those objectives, they will be highly regarded by senior management. This results in career advancement and additional compensation -- good things for the CIO. If they fail to meet those objectives, they may soon find themselves out on the street looking for new opportunities.
Great CIOs want to be the best CIO they can be. They recognize that they can do that only if they select great technology vendors. It's a symbiotic relationship that ideally is win-win for everyone involved.
So what's the bottomline? Your ability to make a CIO successful is critical to his or her being willing to establish a business relationship with you and purchase your technology products and services.
Lesson #2: You Can't Sell to CIOs If You Don't Meet With Them
Can you win the lottery if you never buy a ticket? No. You have to play to win.
The worst thing you can do when selling to CIOs is not get enough “at-bat” opportunities. I've heard many technology companies say “We've got a great technology offering that can really help people. But we don't have enough sales opportunities with CIOs that allow us to explain the benefits.”
You may think you are doing well because you close a high percentage of the opportunities you have in which you are selling to CIOs but if you only have one or two opportunities per year, you may find that your perfect batting average doesn't prevent your company from going under.
If a tech company isn't getting enough “at-bat” opportunities, it could be for any of the following reasons:
- The sales force is understaffed or undertalented. Many technology companies are started by technologists, not by sales people. It's quite typical for such companies to spend a ton of time and money creating a product but invest little time and money in creating a quality sales force. Those who are successful in selling to CIOs know that it's not necessarily the best product that wins the deal. It's the people who are best at selling to CIOs who get the deal.
If your company isn't hitting its sales projections, you should consider changing or expanding the sales lineup and bringing in people and processes that have a proven track record of securing sales opportunities with CIOs. Alternatively, hire a sales consultant who can work with your existing technology sales team to raise the level of its game.
- Your personal reputation doesn't precede you. It's not what you know, it's who you know. At a recent industry conference, a senior technology executive at Allied Vans stated: “We do deals much more quickly if we know and trust the people we are talking to.” Similarly, a successful technology sales executive said: “To be honest, our selling abilities are based on our ability to befriend the IT executives—we play racquetball with them, we take them out to dinner, whatever it takes.”
The lesson for an aspiring technology salesperson? Cultivate relationships with CIOs and individuals who are likely to become CIOs in the future. The lesson for the CEO of a high-tech company? If you want to sell to Corporation X, hire a sales person who knows their IT executives and who has sold to them in the past. If that's not an option, hire sales people who are adept at building new friendships with CIOs.
- Your company's reputation doesn't precede you. If your firm hasn't mastered marketing to CIOs, it won't stand a chance when it tries to sell to CIOs. Are you aware that CIOs receive thousands of email and phone messages per year trying to sell technology products to them? Given their busy schedules, CIOs only have time to look at and evaluate a very small fraction of these inbound messages, let alone to actually evaluate and understand the hardware and software offerings behind the message
If your firm's marketing department has done its job well in marketing to CIOs, then the CIO will return your call because he's heard of your offering and he understands how it can add value to his organization. Not only that, companies that market to CIOs well find that their sales cycle in selling to CIOs is greatly accelerated.
Hence, among other things, it's extremely important that your web site is compelling and includes case studies of client success stories and technical white papers; that the media writes nice things about your technical offerings; that you reach out to existing customers and prospective customers on a regular basis with timely and effective HTML-based emails that explain the latest news about your company; and that your executives appear at industry events as speakers and become viewed as thought leaders in your area of focus. Your marketing department may do this for the company or they may utilize an external firms, such as Walker Sands Communications, to do those functions for them.
- Your company reputation does precede you (and it's not doing you any favors). Let's face it. Even though the best products don't always win the deal, it's widely accepted that the worst technology products and services never win the deal. A company that offers poor service or buggy software doesn't get repeat business or referrals. Word spreads quickly throughout the industry. Even if you are the CIO's best buddy, he won't buy from you. If you work for an organization that has a bad reputation, of course your sales calls won't get returned and CIOs will not meet with you.
There's a certain level of bad reputation that can be turned around - cured through new management, better marketing, and improved business practices within an organization. There's another level of bad reputation that is incurable - companies die a slow and painful death and sales people don't hit their numbers. If you are affiliated with such a company, there's only one thing to do: leave and find a new opportunity with a company that has a strong reputation. If it's not clear whether your company's reputation is strong or weak, consider engaging a marketing consultant to objectively test your reputation for you and find out what prospective customers really think about you.
- The “sales pitch” is poor. This is the biggest reason that companies fail to sell to CIOs. The words you use to solicit interest from a CIO must be perfectly crafted. It's very important to not just explain what your product does and give the CIO the task of figuring out if he needs it or how he could use it in his organization. You need to quickly explain the offering and then - this is extremely important -- spend the bulk of your time explaining how your offering can help the CIO do his job well and help his organization achieve its business objectives better than any other alternatives they might be considering. The rest of this article explains how you can do this effectively and improve your ability in selling to CIOs.
Lesson #3: Understanding the Business and Technology Landscape Before You Call
As mentioned above, CIOs don't have time to investigate how your technology offering can help them. You need to do that for them.
Here's an example of inefficient technology selling. I recently spoke with the former CIO of a large consumer goods company. He indicated that he would receive hundreds of calls from technical sales people each day. When the phone rang, his company's Caller ID system allowed him to tell if the caller was an employee of his company calling from within the organization or if the call was an external call. If the call was from outside, he could see if he knew the caller. If he didn't know the caller, he would assume it was a technology sales person and would let the call go to voice mail.
He instructed his assistant to screen the calls and create a call summary sheet that he would review. Presumably, the assistant may not have always recorded some important details about the technology offering if he or she wasn't familiar with the technology. But this particular CIO took the time to educate his assistant on what was important to him and the organization so that she would be sure to properly record and identify those messages that could help him to achieve his IT objectives. The CIO reviewed the call log each day. If the CIO saw something that seemed relevant to his current IT challenges, he would pass the call along to someone who worked for him for further investigation.
At one point in time, the CIO explained to me, he was working on an implementation of PeopleSoft. He was desperately in need of consultants who had extensive experience with PeopleSoft implementation projects - these experts were a scarce commodity at the time. In that instance, he personally returned the calls of every technical consultant or staffing agency and asked them “Do you have anybody with PeopleSoft experience?”
What's wrong with this picture? Isn't it obvious? Nobody called him and said “I know you are struggling with your PeopleSoft implementation. We have some PeopleSoft gurus who we think can help you to get your PeopleSoft project done on time. It's our understanding that current plans call for the project being completed by the end of next quarter. We understand that your senior management is counting on the implementation's being completed on time to allow them to achieve their key business objectives.”
The CIO summarized the problem: “I was very surprised that nobody took the time to figure out what I needed and call me with a solution. Instead, I wasted a lot of time trying to find somebody who could provide a solution. It shouldn't have been that difficult.”
So, based on this example and based on your selling experiences to date, I'm sure you will agree that understanding the CIO's technology and business objectives is critical to CIO selling success. Unfortunately, you don't have a crystal ball that lets you know everything that's happening within a prospect organization. How can you know what they are trying to accomplish? We cover this in more detail in Lesson #4.
Lesson #4: Knowing Where to Look for Business Intelligence
A truly exceptional technology company will have internal or external resources who support their sales force by researching a prospective client. At one company I've worked with, an enterprise software sales person once showed me how he researched a prospective client. He had an opportunity to meet with the CIO of Bergen Brunswick, a Fortune 200 health care products distributor, to discuss his company's software offering.
He called his company librarian and requested a “public information book” on Bergen Brunswick. The next morning, he had it on his desk. It contained the following: a copy of their latest annual report, their most recent 10-K and 10-Q filings with the Securities and Exchange Commission (SEC); analyses of the company from financial analysts; company summaries from Standard & Poors and Bloomberg; and abstracts of news articles within the last two years that mentioned Bergen Brunswick; a listing of web sites that mentioned Bergen Brunswick; and a complete printout of the Bergen Brunswick web site. Based on his review of these materials, he was able to completely impress the CIO with his understanding of the business environment for Bergen Brunswick and its current challenges.
He learned a little bit about the technical environment from some articles in ComputerWorld and Information Week. He was able to deduce many of the technical projects that likely were underway and he determined prior to his sales meeting how his company's offerings could help. In the end, he later told me, he did get the sale and the CIO had indicated to him that his superior knowledge of Bergen Brunswick and its challenges had been the key factor that allowed him to beat the competition.
Unfortunately, if you work at a smaller company, you may not have a resource who can do this research for you. But the good news is that it's not to tough to do yourself. Many of the resources mentioned above are freely available. For example, you can go to the SEC site and see all the filings that a public company has made. You'd be surprised how much valuable information is contained in those filings. And, of course, you probably already know how to go a search engine site and find other sites that reference a prospective clients. Sometimes you'll find that an article or case study that has been written about them that reveals specific information about their technology initiatives. Your understanding of those initiatives should help you to better understand how your technology offering can add value. And, in any case, the fact that you spent the time to research the prospect in great detail often in and of itself is greatly appreciated by a CIO who is evaluating you and your offering.
Lesson 5: Try to Dominate a Vertical / Use Success to Fuel Success
A poor technology sales person will jump haphazardly from one sales opportunity to another, perhaps calling on a telecomm company one day and an insurance company the next day. A successful technology sales person will concentrate on a specific industry. If the prospective customer is large enough, a single sales person may dedicate 100% of their efforts to that customer.
Why does the successful technical sales person focus on a specific industry for an extended period of time? It's because, now more than ever, selling to CIOs requires specialized, focused industry expertise. Companies don't buy technology. They buy solutions. More specifically, they buy solutions for their industry and for their company.
Accordingly, as discussed above, you need to become one with their industry. If you are selling to banks, you need to read American Banker. If you are selling to a consumer electronics manufacture, you should attend the Consumer Electronics Show to learn more about that particular industry. If you try to sell to multiple industries, you spread yourself too thin and you will lose to your competitor - a sales person at another company who has immersed himself in becoming an industry expert.
Another key reason to focus on one industry at a time is that referrals and references are the primary driver of new technology sales. One IT consulting company started off by just telling its sales people “Go out and sell!” and they had limited success, even in a booming market for outsourced technical services. A new sales executive came in and reorganized the sales force around industry verticals. After becoming expert in the nuances of airline operations, the sales team that focused on the travel industry was able to secure a project with Delta Airlines. With this industry-specific reference account in the bag, the company was subsequently able to secure business with British Airways. Those two reference accounts were instrumental in allowing them to get a project with Travelocity - an opportunity that came via a referral from an executive at Delta Airlines. What made the company so effective in selling to CIOs? Senior executives and sales staff at this company agree that industry focus was what allowed them to take their company and its selling success to the next level.
Take a moment and brainstorm about what industries your company should be pursuing. What tactical programs could be put in place to get in front of those industries? Perhaps your marketing department should engage a public relations firm to secure speaking engagements for you at vertical-industry conferences. Perhaps they should pursue article placements in publications that focus exclusively on the vertical that you want to pursue. Maybe your company should host a seminar and invite CIOs from that particular industry to attend an event that specifically addresses challenges they may be facing in their industry.
Lesson #6: Know the Technology and Know the Competition
This is a short lesson—it should be obvious. You can't bluff your way through a sales call with a technology-savvy executive. If you don't know your stuff, it becomes painfully obvious. In the old days, the CIO was not technically savvy. That's because all of the technically savvy people were 18 years old and weren't old enough (or experienced enough) to become CIOs. Guess what? Those kids are now CIOs. They grew up playing with computers, implemented numerous big IT initiatives, and keep current on new technology trends. It may help to schmooze them and take them to the local professional basketball team's games, but that in and of itself is not going to get the job done.
I recently talked to a sales person who was selling supply chain software. I probed him as to what the difference was between his software and that of I2 and Manugistics; from my prior experience providing IT consulting services to large organizations and from my operational experience, I knew quite a bit about these two products. He had some canned answers but they were unconvincing. I would have been really impressed if he had mentioned some specific modules, technical attributes, or functionality within I2 and had specifically identified how his product was superior. He didn't do that so I remained unimpressed. As it turned out, his background, prior to becoming a technology sales executive, was working at a fashion retail chain in marketing. He was very polished, very smooth and professional but I'm guessing he is struggling at technology sales because he doesn't speak the language well.
What's the bottomline? If you are in charge of building a sales force for a high-tech company, hire people who are technologically-savvy. The perfect hire is a computer-science undergraduate, ideally with an MBA, deep experience in a specific vertical industry or functional area, and previous IT selling experience. Facilitate your sales team staying current on IT trends and make sure they fully and intimately understand the competition and its offerings.
If you are on the front lines selling, spend as much time as you can learning about technology so that you can “talk the talk” and “walk the walk” with customers who are increasingly sophisticated, with little patience for salespeople who don't know what they are talking about. Lobby your upper management to help you to be more educated by sending you to conferences and buying you relevant technology books. Attend your competition's seminars. Encourage your marketing department to do detailed competitive analyses on competitive offerings
Lesson #7: Customize Your Presentations and Your Demos
I once was part of a sales team that competed for a project building an expert system (using artificial intelligence and business rules) for a large hotel company. Our competition created Powerpoint presentations and proposals that were 90% boilerplate materials, the same materials they'd use to pitch an MRP software implementation for a medical products company.
We thoroughly researched the company, the available technologies, and the industry to fully understand it. Every slide in our presentation and every page in our proposal was specifically customized to the prospective client.
We also convinced our technologists to work late and build a quick prototype of the system. A few pizzas was all it took to get them to work all day and all night for a couple of days to build a demo that was tailored for this client.
Based on this customization and this above-and-beyond effort to show the prospective customer that we understood their needs and that we bring a strong work ethic to all of our engagements, we got the project.
If you put the effort in and do more than your competition, you'll find that you will beat them every time. Even a small company, a David, can slay its big Goliath competitors through this technique. If senior management argues that you're giving too much away during the proposal process and shouldn't go so far as to build a demo for the client, let them know that if you don't do it and a competitor does, you won't get the sale. Do they want to get the sale?
Lesson #8: Understand the Business of IT
Selling to CIOs isn't that different from selling to others. There are basic selling principles that apply across industries. One of those is to understand why and how things get done at your prospective customer.
Take my business as an example. I've left the world of IT selling and the task of selling to CIOs to form Walker Sands Communications, which focuses on helping high-tech companies to increase their selling success via marketing and media relations initiatives. Although I've never worked at a PR firm, I've learned the business of PR through careful study and by hiring a team or skilled individuals who have spent their entire lives in the pursuit of marketing and communications excellence.
We sell on both sides of the fence. We persuade clients that we can help them with marketing and public relations. Once we are engaged, we help with positioning and ultimately we package up story ideas and present them to the media, with the hope of securing story placements. In this instance, we are selling to journalists and editors.
Do we need to understand why and how things get done at a given publication in order to “sell” them a story idea? You bet. For example, I've learned that if you send an email to a Chicago Tribune technology reporter on a Thursday, you never get a response. That's because they are working on the big Monday Business/Technology edition deadline and have no time to read superfluous emails. But on a Friday afternoon, send them an email and you will get a response. That's because they are no longer on deadline for Monday and they have time to start thinking about what to write about next. Once we understood that nuance of how things work at this particular publication, we've become much more effective at our “selling” work there.
Similarly, those who are selling to IT organizations need to understand the business of IT. When are the new budgets finalized? How much of the budget is flexible? Do the business units initiate new technology initiatives or does IT “seed fund” an initiative it likes and then present it to the business units to find somebody to champion further investment. Does the company have a “Management By Objective” compensation methodology in which case the CIO and his staff are compensated based on hitting defined objectives? If so, what are those objectives? If one of them is “Server Consolidation”, does that help you to sell your offering? When are these objectives defined? Is there any way you can influence them such that eventually your offering will be the key to a CIO's hitting her objectives?
Part of this is just being able to talk the talk and show that you understand the CIO's business. If you are oblivious to the interaction between business units and the IT department, you can't effectively play that interaction to your advantage. If you don't understand common IT policies, you can't play them to your advantage. The more you learn about how IT departments work (and where they don't work), the better equipped you'll be to navigate through the IT selling process.
Lesson #9: Anticipate Objections, Find Hot Buttons, and Exercise Spin Control
Basic selling training encourages you to anticipate objections and prepare your answers before the client presents the objection. In some cases, this involves turning a perceived negative into a positive - have you ever heard the IT consulting expression “It's not a bug, it's a feature”?
Everyone has their own motivations - their own “hot buttons”. And in many instances, one man's objection is another man's motivator. For example, an acquaintance of mine sells network management software. When business executives hear his sales pitch, they say “You mean to tell me that I've got five guys monitoring these networks now and if I buy your software I don't need those five guys.” Obviously, that executives hot buttons are decreasing headcount and minimizing expenses to enhance profitability.
Now, the challenge is that the business executive can't make the sale all by himself. One of the most important things you need to know to sell to CIOs is that you typically need to sell many different people to close a deal - you need to sell the CIO of course but you also need to sell the business executives and the IT staff. Any one of the three can kill a deal if they don't like it.
So, in the case above, do you think the IT staff will want to buy a product that will allow the business executive to cut IT headcount. **** no!! They may want their company to do well but not if it costs them their jobs and endangers their ability to make the mortgage payments. Similarly, the CIO doesn't want his staff to be decreased for a variety of reasons.
Accordingly, a good technical salesperson knows how to spin the situation. My acquaintance doesn't tell the business executive and the CIO that this will result in staff cuts. Rather, he tells them that it will allow the existing IT staff to concentrate on more strategic projects. In this way, the sales professional reaches out to the CIO and helps him to avoid headcount reductions and he does see the value - after all, he is always resource constrained and would love to redeploy resources to more valuable tasks - that is a given at every IT organization!
What about the IT staff? My acquaintance gets their buy-in in the following way. He knows that the IT staff is frustrated with their inability to convince management to buy some new hardware and software that they want. My acquaintance uses this to his advantage. To the IT staff, he says “If you buy my network management software, you will get detailed reports that will identify deficiencies in your network. Armed with this objective quantification, it'll be much easier to get your IT procurement requests approved in the future.” That is music to the IT staff's hears and, joining the business executive and the CIO, they jump on the bandwagon and my friend gets his purchase order.
The key to his success? It was understanding what people are motivated by and playing those “hot buttons” to his advantage. Those who are good at selling to CIOs understand those motivators implicitly and intuitively over time because they understand the business of IT. Are you able to anticipate the objections you will receive and spin your responses such that everyone is happy with your offering and wants to buy it? If not, it's time to sit down, by yourself or with your marketing department, and think things through. Once you do, you'll be on your way to more effective IT selling.
Lesson #10: Selling to CIOs is More than Just a Sales Function
If you've read all of the previous lessons, you may have noticed that you are not the Lone Ranger, out their selling alone. For an organization to be truly effective at selling, sales needs to be built into the entire organization. Marketing and technical personnel should attend sales training and should periodically participate in sales calls.
The reason should be readily apparent. Marketing needs to get the word out to prospective customers in order for Sales to be successful. If they don't understand how to sell and they don't understand why sales efforts for your company win or lose, they aren't going to be able to help you much, are they? Similarly, if the Product Development Team in technology doesn't appreciate how to sell, they will likely create a product that doesn't sell. What may seem like an unnecessary bell-and-whistle function to them may be the feature that you know will get you in the door at a company you've been chasing for months. Creating formal feedback loops within an organization that focus on selling is a critical role of senior management.
When formal techniques that encourage integrated selling are absent, you may need to resort to informal techniques. In other words, get to know your marketing team intimately and be able to call in a few favors. The technical sales person who says “Our marketing stinks. That's why we can't sell this stuff.” should proactively reach out to the marketing staff and work to improve things. Similarly, it's advantageous to get to know the technical people in the Product Development Team. As discussed earlier, sometimes you can get them to create something specifically for you that will help you close a deal and the price may be just a few late-night pizzas.
Lesson #11: The Sale Isn't Over Once the Contract is Signed
You finally have been successful in selling to CIOs and have closed a deal. The commission is in the bank. Is your job done?
Absolutely not. You need to make sure the client is happy. Otherwise, you may not get a good reference account and you may not get referrals to other prospects. Remember that in technology selling the vast majority of sales to CIOs are driven by reference accounts and referrals.
In addition to getting a referral, staying in touch with somebody you've sold to can have other benefits. First and foremost, there are cross-selling opportunities. Once you are in, after the first sale, you learn more about the customer. Now, you don't need a crystal ball to tell you what challenges are facing the CIO. You are right there - front and center - within the organization, either as a consultant or as a dedicated sales person who returns frequently to ensure that your hardware or software products are well regarded.
Another important benefit of not abandoning the customer after the sale is driven by CIO turnover. The half-life of CIOs is much shorter than most CIOs would like. It's not uncommon for CIOs to jump to new companies every two years. If the CIO were to stay in one place for his entire career, you might just get one sale from him or her. If you keep up relationships and provide exceptional customer service you may find that you get five sales from the same person over the course of a decade of selling. Similarly, if you leave and go to a new company, you can revisit your relationship with the CIO to sell your new offering - but that is possible if and only if you made sure that the CIO was happy with what you sold him the last time. That happens if and only if you stay in contact with the CIO after the sale and make sure he's happy.
I made the mistake of not doing this early in my career. I had worked on a big consulting project for a large chemicals company. The CIO liked me and appreciated my work. Years later, I was at a new consulting company and the CIO had also moved on to new things - he had become the CIO of another large chemicals company. I looked him up, found out what projects he was working on, and introduced him to my new company's services. He asked us to provide a proposal on a project. Using the highly customized above-and-beyond approach discussed above, we won the deal.
However, once the deal was won, I moved on to other things. I had another client engagement that I was working on and assumed that things were in good hands with the engagement at my CIO friend's company. As it turned out, we didn't do a good job for the CIO and we were not asked back for any additional work. I haven't spoken to the CIO since then, and, based on the last experience, I'm not sure he'd entertain any new ideas from me. Had I simply followed the progress of the consulting engagement after the sale and intervened when things didn't go smoothly, I'm certain I could have salvaged the engagement and the relationship, which would have been useful in my future endeavors. Oh well. We all make mistakes once - it's just important that we learn from our mistakes (you get to learn from mine as well!) and that we don't make the same mistakes twice.
Lesson #12: Miscellaneous Tips and Techniques for Selling to CIOs
Hopefully, the previous lessons have been helpful. There are all kinds of tidbits of advice that can help you to be more successful in selling to CIOs. Here are a few final tips and techniques:
- Choose an Appropriate Title. Make your title “business development” or “consultant” instead of using a title that mentions “sales” explicitly. Let's face it. The profession of sales carries some baggage and you'd do well to call on prospective clients as a consultant or prospective business development partner, rather than call on them as a salesperson.
- Befriend the Executive Assistant. Remember the CIO who had his assistant log all of his vendor calls and screen them for relevance. Creating a relationship with that assistance can be the difference between getting in the door and not getting in the door. Offend that assistant and you've probably lost the sale.
- Find the Research Screener. Most CIOs have somebody who reads all the research that comes from outfits like Gartner Group and Meta Group. They also read the computer trade publications. They then cull out a small number of “important” articles that they forward on to the CIO to read. If you can find out who screens magazine articles and research for the CIOs and get your articles in front of them, you may find that you can influence the CIO's worldview to your advantage.
- Know When to Call. Call in the early hours or in the late hours after most people will have left the office. During the day, it's tough to get past the CIO's executive assistant. However, if you call the office at 6:30 AM, you may find that the CIO is at work getting a jump on the day and will answer the phone himself - he has to do that if his assistant isn't in yet. Similarly, some CIOs work late into the night and you can catch them then.
- Attend Industry Events. Some CIOs are featured speakers at industry conferences and you can learn about their business challenges by listening to them speak. You may also be able to talk to them directly during a coffee break. Be sure to avoid stalking the CIO in an obnoxious manner - that's a sure way to annoy him or her and lose a sale.
- Identify Circles of Influence. Every CIO has a group of people that he listens to concerning IT decisions. Maybe there's an analyst at Forrester or one of the other research houses that he looks to for advice. Don't underestimate the power of the analysts in influencing purchasing decisions! Maybe the CIO calls his former boss for advice or a peer CIO in a non-competitive industry. Find out who influences the CIO and get your messaging in front of those key influencers.