More than ever, you need to let your customer success strategy be driven by customer need and, on the new business side, let the strategy be driven by market conditions, says Hireology’s SVP Revenue, Debra Senra.
I caught up with her ahead of her spot at the virtual CRO Summit on February 17th to find out how Hireology’s been navigating the past year…
Q. In your talk, you’re going to cover Hireology’s Covid strategy. Tell me a bit more about that.
A. When COVID hit, we wanted to do right by our customers, but also keep our business running and retain as much as possible. And then, on the sales side, we monitored leading indicators of what was happening in the market, to be able to adjust our approach to be fairly empathetic to what people were going through, but still maximize the opportunity that was in front of us.
In the States, it was a series of starts and stops with our customers. When we were in a ‘start’, it was really important that we went after it. But when we were in a stop, we wanted to make sure that we knew that and then modified our outreach tone to account for some of the trouble that our prospects were going through.
Q. What did that look like in practice in terms of how you worked with your sales team?
A. We used a series of metrics to help us understand what was happening with our team and within the market. And the metric that we monitor really closely was our ‘dial-to-set’ metric. So how many calls did it take to get a demo set with our prospect base? In a normal world, that dial-to-set metric is between 40 and 50. It’s a leading indicator for willingness to spend and openness to buying what we sell.
When Covid hit, we saw that number spike into the multiple hundreds in our automotive segment. That was a really strong indicator that the market had no interest in what we were doing, they were going through other stuff, it wasn't going to work. So we actually pivoted our entire sales team, to our healthcare division where our dial-to-set metric was unchanged. Even at the beginning of Covid, there was still a lot of interest in what we were doing.
We started to migrate some folks back when automotive started to normalize, and we closely monitored their dial-to-set and as long as it stayed kind of under 150, we felt comfortable having our team focus on automotive, but the tone of their outreach should be more “how do we help you?”, “What are you going through?”, “Can we provide a free consultation?” until it dropped under 100, which was an indicator to us that people were interested in actually buying.
So then the messaging changed a little bit to less from “How can we help and provide you with services without you being a customer?”, to “Stuff is happening in the market: where is our product needed?”, and “Let's get on the phone and talk about what we do and how we can help you moving forward”.
Q. Have you learned anything from pivoting that you will carry over into your longer term strategy?
A. Of course, I mean, we still are using it because COVID didn't go away. So we still use that metric pretty aggressively to determine what we can expect in each of our markets. And actually, towards the turn of the year, what we were finding was that our quota carrying reps had a very normal dial-to-set number it was about 50 to 55, which is what we saw pre-pandemic, but for our BDR team that focuses on a different segment of the market, they were significantly higher. That prompted us to look into why the segment that our quota carrying reps cold call into was more interested in what we're doing than the segment that our BDR team is calling into.
What we found was that, for the first time in decades, automotive dealerships are fully staffed and their people are staying in the automotive industry; it's not uncommon for 100% of your staff to turn over in a year, the average is about 65%. So I started getting on the phone with some of these smaller customers that the BDR team calls. What they were telling me was that they know it's not going to be like this forever, but were saying “We have a single dealership, we've been fully staffed for the past couple months. I'll need hiring software in the future. But I don't need it right now”, versus the larger dealerships that had, say, eight rooftops. They weren't fully staffed.
Even though the need wasn't as strong, they did still need to recruit people. And so we actually pivoted our BDR strategy for February, where our BDRs are going to be more aggressively tackling some larger dealership groups, and our quota carrying reps are going to narrow in and focus a little bit more on their ‘whale opportunities’ to try to get as much productivity as possible out of every person that's on the team.
Q. How have your other segments been impacted?
A. Primarily, we sell into three. The first is retail automotive. The second is healthcare. And though long term care facilities like nursing homes have really struggled because of Covid, home care, home health care - those industries are booming. They need more people now than ever. And so we really didn't see a decline in interest from that segment.
The third is franchise based organisations. So think gyms, restaurants, salons, and so I would say retail automotive was one where we had the full continuum. Yeah, bars and restaurants decimated. Yeah, healthcare. Totally. And then retail automotive. July was the best month on record for retail automotive in the United States in years. But in March, the entire industry was in a panic that they were going to go under. So that was really the segment where we had the most uncertainty and where we needed to be the most agile.
Q. When you talk about how you pivoted to help your sales team to help the customer, how did they position themselves as thought leaders? What kind of content were they using?
A. I'll start with our customer success team. It was March 12, the president at the time, went on TV and essentially said Covid is serious, and a kind of panic hit the United States. Then, Friday, March 13, everything came to a screeching halt. Then by Monday or Tuesday of the next week, we were getting mass cancellations of our product from the franchise side of the business and our auto customers. They ere calling us and saying, “Our other vendors are slashing their price by 50% to help us get through this time, can we expect you to do the same?”
But what we decided was: we don't sell marketing tools, we sell software that helps you hire people. So I didn't think our product was analogous to the other software vendors that sell marketing technology. We had some customers who were doing layoffs and, in some states, you are not legally allowed to post jobs when you're doing a layoff for that role. So some of our customers were calling in, and they were saying, “It's illegal for me to use your software right now”, and, for that customer, it just made no sense to do a 50% discount: 50% off of something that they can't use isn't enough.
But some customers were doing okay, and took the opposite approach, which is “All of my competitors are laying off their staff, I'm going to sweep up the best people because it's incredibly hard to recruit in the automotive industry. I'm going to strike while the iron is hot”.
A one-size-fits all-strategy wouldn’t work for us. It was just tone deaf to what our customers were going through. But our phones were ringing off the hook. In a normal situation, a customer would call the Customer Success Manager and figure out what's the best strategy. But there was no time for that because we had hundreds of people calling a day. So we built a decision tree for our customer success team that essentially looked at what was happening with the customer and the decision tree led the team to the concession that they were allowed to offer.
For example, if a customer called to cancel, because they were not allowed to post jobs, but we had an amazing candidate for their hardest to fill role in the dealership, we asked them if they’d look at it, If they said no, this is a customer who's worried about their business staying afloat. Yeah, let them cancel. I don't care what their contract says. I don't care if they're behind on their payments. You do right by this person, you let them cancel.
But the customer who calls and says they want a discount off their subscription? We’d ask if they were hiring. Would they look at a resume if it came through? Would they run a background check? If the answer to that is all ‘yes’, well, hold firm, they're still getting a tonne of value from Hireology. Just because somebody else is dropping their price doesn't mean we need to if the value we offer is above and beyond what it was yesterday.
Q. What other concessions were the customer success team able to offer?
A. There were about 10 different concessions that we could make depending on the customer’s situation, so our customer success team was empowered to go through that conversation without involving their manager, and we could do it quickly at scale for customers. The net result of that is our competitors who are offering 50% off lost 50% of their revenue for the three-month time period while this was going on, while we went down only 10%. It worked really well.
One of the concessions we offered was a temporary discount. Depending on the customer’s situation, it could be that we took away things in their subscription that they would normally use but that they had no use for, and scheduled it to come back or get a price decrease, whatever the case may be. When we did it, we didn't know if customers were going to do right by us. And when the time came to pay us what they were supposed to, you know, it was kind of 50-50 if they were going to do it or not.
Then we transitioned that mentality to our sales team and mirrored the options that we had for our customers to our new business prospects. Now, there weren't as many we'd offer 10. But it did help them be more consultative based on what they thought was best for the dealership and how they could help them.
Q. Following how you’ve had to pivot over last year, what would be that number one piece of advice you’d pass on to other companies?
A. In a time of uncertainty, people panic, and a really common reaction to panic is to do what everybody else is doing. My advice would be: don't do that. Take a deep breath. 24 hours is nothing. It feels like an eternity when you're in the middle of uncertainty. But take it, think about what's right for your customers, think about what's right for you, scenario plan, and take a risk and move forward with what's best for your business.
That was absolutely true on the customer success side. Also if you look at the LinkedIn archives from March 2020, everybody was saying “Sales teams - lead with empathy, but that was such shitty advice to give to your sales team. Well, what does that mean? Am I calling and saying, “How do you want to buy from me?” Or am I saying “How are you?'' and then letting them off the hoo? Just focus on your business, figure it out, be really prescriptive to your team, take a risk and do what's right for you.
Q. How important has data been for you in making these decisions?
A. There's no such thing as accurate or right data - I worked in market research for years. You can find data to tell any story you want. If you're laser focused on getting accurate data, you're going to be paralysed because there's always a nuance to data. People think it's it's science, it's not, it's art just as much as science. The important part of data for me is to build something that makes sense for you so that you can get a pattern and see how things have trended over time.
I'm measuring the same category at the same frequency in the same way over a longer time period. The fact that we had that made all of this so much easier, because I could look at our data and see very quickly when something had changed and at what magnitude. I could dive in and see where the change was coming from.
So, instead of having all or nothing strategies, like the BDR story that I shared, it's not that our BDRs aren't setting calls so “Let’s get rid of them”. I'm going to just shift their focus. So I'd say to anybody that doesn't have what I call ‘holy drivers’ that inform your business, figure out what yours are. Start measuring them, because, in 2020, having holy drivers helped me spot a problem in 2021, and those same holy drivers will help me see when it's time to accelerate.
Q. How do you identify when it's time to accelerate? What ‘holy drivers’ are you looking for?
A. It’s that dial-to-set ratio. We've never really had a problem with conversion rates. So our holy drivers are, how many dials does it take to get a set? What percentage of sets hold? What percentage of set demos result in an opportunity? What percentage of opportunities result in a closed one deal? And what's our average sales price?
Throughout the pandemic, if we got a demo, everything looked great, nothing really looked different. In fact, our average sales price went up over 2020. We used our demos-held to opportunity-created ration to test our marketing messages. Because, if somebody says they’re willing to get a demo, then see our product and say, “Actually, I'm not interested in that”… well, there must be something with how we were positioning our product on the front end, something that was misleading, because the prospect was interested until they saw it, and then they weren't. So what can we say wrong?
That strategy went really well, all year, but it was just top of funnel. So what I'm monitoring for an acceleration is “When does that dial-to-set ratio drive down consistently into the 40 to 50 dial range”? And then what I'm looking for is “Do our conversion rates hold from where they were in 2020?” Because, theoretically, our conversion rates were strong, because very few people were interested in recruitment software. But if you were interested, you are a very serious buyer. In a world where people are accelerating and needing to hire does our conversion rate fall off? That would be an indicator to me that we need to work on our messaging, we need to work on our competitive positioning, we need to work on our closing skills.
Q. So do you think things have changed forever? For your market?
A. I don't think so. In automotive dealerships, for example, the average dealership had 65 employees pre COVID, now the average dealership now is operating at about 55 employees, and they're selling more cars. So I think the automotive industry is going to be more productive than it ever was. I think part of the reason they're so productive, is because there's excess cash in people's savings accounts. It's a really bifurcated market: you're either in dire straits, or you're saving a tonne of money. We’ve started to normalize, and we closely monitored our dial-to-set and as long as it stayed kind of under 150, we felt comfortable having our team focus on automotive, but the tone of their outreach is now more “How do we help them?” Can we provide a free consultation until it drops under 100?.” That’s been an indicator to us that people were interested in actually buying.