Scaling cost of selling

There is something to be said about long weekend. On the other hand, it is also doubly difficult to come into office after a long weekend. The funny thing was that I was the first person who made it into the office after the 4th of July long weekend. At first I thought I missed the memo about taking an additional day off until people started to slowly file in.

Another thought on long weekends. I am envious of the French with six weeks vacation to start. Ay... I still remember getting an e-mail from Isa a few years back saying that she is so sad that she only has six weeks of vacation because she was a newbie college grad! Man, talk about rubbing it in, eh!

Anyway, all is quiet on the marketing land. I have been busy playing catch up in terms of phone calls and negotiations. Today, for example, I negotiated for a volume discount to publish four of 'em white-papers. Then, I had an inconclusive discussion with a lead-gen consultant. She will get back with me on a new proposal. Oh, I also got a call from Dell asking if we would be interested in using them as our hardware OEM. Then, I got a phone call from a perspective customer irritated that nobody followed up with him since he requested information. (The truth is that we have tried to contact him seven times via phone and email.)

Maybe it ain't so quiet after all.

Oh, the Harte Hanks program is coming to an end. I am in negotiation with the HH rep on price. And, since we are negotiating, I also asked for tape recordings of the calls. The rep will get back with me in terms of pricing. We are currently paying approximately $55 per hour for the HH caller. The caller is able to complete 1.2 calls per hour with an actual appointment made at 0.14 per hour. I am not rendering any judgement on these numbers. These are our new baseline.

So, talked with a lead-gen specialist in our area on retaining her for lead-gen work. the thinking is that she will be better at qualifying prospects and providing higher quality leads in the process. Got her proposal today but the cost number was a bit out of my reach. So, we went back and forth a bit about the structure of the proposal and the costs. She promised to get back with me on the counteroffer. Will let you know if we decide to go forward with her.

Busy working on some PR pieces. I am done with the white-papers and just need to figure out how to best publicize them with our PR team. I have gotten the first draft of a customer case study. The content is more or less in place. I will probably get it to the customer for approval then get it beautified. It is a bit tedious but necessary.

There was an interesting discussion last week. Mr Whup-ass wants Marketing and Sales to assign rating for the same lead. So, as a lead comes in, Marketing enters the info and provide a rating opinion based on the available information. Then, Sales would also render a rating opinion on the same lead. Now, this is not a difficulty thing to do mechanically. On the other hand, it is not clear to me what is the point of this exercise. My argument is that it does not provide any meaningful insight since these ratings are liable to be highly biased and variable. Mr Whup-Ass wants to have these numbers as an early warning systems on the lead flow. We went back and forth on this issue and, frankly, I do not believe that anyone is convinced of the other's position. Nevertheless, we decided to humor him since it is a very minor incremental process given what we currently do.

Of course, I need to keep open-minded on this issue. Nevertheless, I am not sure if the data is action-able. We'll see.

Along the line of lead gen, we had another discussion on what is the strategy for lead gen given the performance of HH. The concern is that on a per completed sale basis, HH and other cold-call operation would be extremely expensive for our average sales price. More specifically, this makes the business model significantly less scalable.

This will be an on-going discussion of course, but looking at the initial numbers, I think the concern on the cost per sale is valid. One possible way is to bring this function in house which we estimated to cost about 2/3 of what we currently pay. The other possibility is to scrap that program and pour the resources into more PR work since it seems to increase the lead flow every time we do something.

I think partly this is a discussion on the price points. As we move downstream in price points to soak up user demand, the cost of selling needs to be able to scale downward accordingly. This is a critical insight but I do not know what the answer is. Yet.

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