11. Matt Nettleton ~ Sandler DTB

Transcript

0:03 Well, yeah, man. I mean, what we're talking about with uh, you know, outbound in an inbound world. I mean, I love hearing that because I do feel like

0:11 everyone I talk to is always talking about inbound and how outbound's dead and all the different ways that it's dead. Um, yes. Curious where what your

0:18 perspective is on that where POV is, and kind of expand on it.

0:22 So, I I think there are a lot of sales people who are hoping to build a career sitting patiently at their desk waiting aggressively for the phone to ring and

0:31 and if their sales career goes belly up, they're going to reach out to the marketing department and complain that they got bad leads.

0:39 >> Yeah. >> And and it just it it's amusing to me.

0:43 You know, I've been doing this I've been a sales trainer for 23 years. I've been in sales since 1987. It is very rare

0:52 um for the fish to jump in the boat and be the right fish.

0:56 >> Yeah. I mean, it's fun when it happens. >> Yeah. >> Yeah. You just can't expect it. I think there also is like um a glorification or

1:04 like putting people on the pedestal that have like these great inbound moments and everyone talks about that when like 99.9% of what's happening is not that.

1:14 And so like right earlier stage companies lose track of the idea that no this is going to be built the way that it's everything else is built unless you're extremely lucky. But

1:22 >> why wait for the fish to jump into your your boat, right? >> Yeah. Well, and the and the problem is like even if you have great marketing and it's super targeted and it's

1:33 exceptionally data driven and it's really well designed, most of the people that respond to your marketing messages aren't your ideal client,

1:43 >> right? Right. So if you have the normal paro principle where 80% of the market produces 20% of your revenue.

1:49 >> Yeah. >> You have you know 80% of the market's not fit to even buy from you.

1:54 >> 20% of the market's going to buy from you. Of that 20% there's realistically 4% is going to generate 80% of your

2:03 revenue. Of that 4% you're going to have about you know 1.4% 4% is going to generate 64% of your revenue.

2:14 >> Yeah. >> Well, the odds of getting 1.4 out of a 100 people to contact you on a regular basis to build predictable pipeline is

2:23 almost non-existent. >> Yeah. Yeah. >> So, you've got to have a strategy to pick the people you want to talk to and then go do it.

2:31 >> So, you can convince me with those numbers. What are you doing when you're talking to somebody who's, you know, you're training or you're working with

2:37 or you're advising and you're you're trying to shake them out of the this whole inbound notion? Like what are what are your steps to like create that action plan to get them to actually

2:46 change their behavior? >> So the the the first thing we talk about is what their goals are

2:56 >> and the second thing we talk about is what's their plan if they fall behind.

3:03 because they the the reality is, you know, if you've ever read uh anything about goal setting and playing, there's a book called the 12week year,

3:14 which is a great book. >> That one. >> Yeah. >> Yeah. It it basically says you can set an annual goal, but nobody ever works off an annual goal. It's too large a

3:21 window. You can't focus, right? So if you do if you want to set effective goals set set an annual goal and then you have four way points during the year

3:32 every 13th week you sit down and go okay where did I start where am I where am I trying to get what do I have to adjust >> and and

3:41 the odds are about 100% that you're going to have to adjust something on a quarterly basis to hit your annually goal right >> totally >> so you're almost always off course on

3:52 your goal Mhm. >> Well, the hard part with sitting around and waiting for inbound is when I say to you, okay, assuming that you're off

4:01 course at the end of Q1 on your annual goal, what are you going to adjust to get back on course?

4:09 >> And if you're if you're 100% inbound and your answer is, I'm going to wait more aggressively for the phone to ring, I can guarantee you're not making your number.

4:18 >> Yeah. Uh, a funny thing that I keep hearing over and over and it I mean no no shade towards marketing because marketing and sales are on the same team

4:27 but you can have a you can you can have a sales team and a sales org without a marketing team. You cannot have a marketing or without a sales team. Like

4:36 you have to have that sales team no matter what. And that sales team should be doing things. And obviously when you're working together it's always better but there is a crucial thing

4:45 which is what are you doing actually as a seller to actually get that ball moving and everything.

4:51 >> Yeah. >> So so you you have this you go okay look here's your annual goal. We're breaking it down by quarter. You're not hitting that like are you bringing them back

5:00 into the cookbook and like the activities that they should be doing and then saying this is what we have to do and then having like the hard conversation of like being like hey

5:08 let's be realistic. You said you were going to make your team or you were going to make 500 calls this month or each month. You've done 390. That's why

5:18 you're not hitting the number. >> Well, so the annual goal is a lagging indicator of success, right? It's like staring at the scoreboard and then trying to coach the team at the end of

5:27 the fourth quarter. >> Like it doesn't work. >> So, what you've got to be able to do is walk them backwards through the things that have to happen in order for them to

5:37 hit that lagging indicator. Mhm. >> And and that's the that's the conversation. I don't have to tell them that they have to do outbound.

5:46 I just ask them how they get to the step before the step they're at. And eventually they have to produce leading indicator behavior.

5:55 >> Like they they have to do things that start the process.

5:59 Right? If I wanted to lose 200 lb and my plan was to to think deeply about being skinny while laying on the couch

6:08 eating pizza, watching TV, I would never lose 200 lb.

6:14 >> Yeah. >> Right. Be a fat guy laying on the couch watching TV, eating pizza, which doesn't sound terrible, frankly, but doesn't help lose 200 lb.

6:23 >> Yeah. It's just not in alignment with what your goal is. >> Yeah. you can't you can't get there from here. So, what you've got to start to think about is most salespeople have an

6:34 annual goal. >> I mean, it's just kind of part of the deal. And last year, 2025, 33% of salespeople attained quota.

6:46 >> Jeez. >> And twothirds didn't. Right. So if if you're comfortable, you know, on a

6:55 crapshoot that there's a twothirds chance you'll miss your goal and when you miss your goal often enough, eventually your boss makes you

7:04 available to industry. >> Mhm. >> And and then you have to go find a new place to work because you know while you were waiting aggressively for the phone to ring, you missed your number

7:14 >> and they hired somebody new who will wait aggressively for the phone to ring, right? But nobody nobody hires a new guy to wait for the phone to ring. Uh one of

7:23 my favorite clients, uh guy I've worked with for, you know, off and on for 20ome years now, uh he said, "Everybody at our company

7:32 prospects. Some people prospect to sell our products and some people prospect for new jobs."

7:40 >> It's a great line. I like that a lot. >> Right.

7:45 So when it comes Oh, sorry. >> Yeah. And so that that just that's kind of the whole point is you don't really have a choice.

7:54 >> Mhm. >> At some point you're going to pick up the phone. It's just you get to decide whether you're going to pick up the phone to make a commission or get a new job.

8:03 >> Yeah. Yeah. What about if you're working with an org that um let's say the leadership doesn't have that same

8:12 discipline and like how they're you know I agree with the motto of like are you in the prospect or you prospect pick one >> right >> uh how do you go about the change

8:21 management of going to an organization that maybe doesn't have the same level of commitment and changing that environment so that we can have the

8:30 right type of like responsibility accountability what people should be I every organization has to describe has

8:39 to be able to define and describe and map out their buyer journey.

8:42 >> Mhm. >> Right. And and so there are some buyer journeys that are super simple. You know, it's nine bucks per person per month. You're buying a seat. How many

8:52 seats do you want? And it can be largely self-s served, right? And and we've all we've all individually and corporately purchased

9:02 things like that. Yeah. >> But the reality is that's probably 3% of the market.

9:08 >> Right. >> Right. There there's just not that much that we can buy on a per person per seat per month basis that is going to produce enough revenue to keep a company going.

9:20 >> So you know Dropbox has an enterprise sales team.

9:25 >> Right. All these companies that do the per person pricing, they all have enterprise sales teams.

9:31 you know they and and what that tells you is that you might be able to to describe the problem you're trying to

9:40 solve >> and you might be able to do an internet search and you might be an AI enhanced internet search and you might be able to gather details

9:49 but the conversation that you have with a salesperson who is competent >> helps the buyer make better decisions.

10:00 >> Yeah. Right? And so there's always going to be room for people to have conversations and learn things they didn't know they needed to know.

10:10 >> Right. >> Right. Well, in order to make that as likely to happen as possible, the best thing that a salesperson can do is pick

10:21 people who have matched either the demographic or behavior characteristics of people who buy from them and call them and say, "We're not doing business, but would you like to?"

10:31 >> Mhm. >> And the more you do that effectively, the more likely your chances are of making a sale.

10:37 >> Yeah. And >> and and the the business owners and leaders that don't have that strong outbound mindset >> will get it once they realize they can

10:48 sell their base level deals, but they can't sell the more complex ones, >> right? Well, I think I had an interesting experience with that as

10:57 somebody who is also prospecting, founded my own company and I'm prospecting every single day. There's no place to hide. Like we're in both. Um,

11:06 and you know, we had done a ton of market research and looked into a vertical and thought this vertical would be great. All of the indicators are there. There's no way they're not doing

11:16 outbound, so on and so forth. Called like 100 different organizations, had about 25 30 different conversations, got some responses to my emails.

11:26 It is like 95% of that uh industry, all referral, inbound based, like stagnant, plateaued out. nobody is willing to pick

11:35 up the phone and do anything. I talked to several leaders who complained about the fact that nobody was willing to put any money into the prospecting side and

11:43 realized that despite all of this market data, the only way I was ever going to find out if this was actually going to be worth pursuing was picking up the

11:51 phone, having a conversation, and then be able to bring it back in internally and say like, "Hey, you know what? This isn't even the right place, but at least

11:57 I talked to them and found out. Let's go somewhere else." Um, so as much as it helps the buyer, it helps the seller too to understand what's actually happening out there when

12:06 you actually have a real conversation, you know.

12:09 >> Yeah. I mean, I've for my entire life, I have found myself time after time saying, "Well, that looked good on paper."

12:16 >> Yeah. Yeah. >> Right. Prospecting is how you figure out in the startup what look what actually looks good versus what looks good on paper.

12:26 >> Yeah. And it helps with identifying SCP. It helps with messaging. You have a conversation with somebody, you're getting real feedback real time, and

12:34 then you go, "Oh, maybe I'll adjust that because that they like stared at you blankly when I was talking to them."

12:39 >> So, I think it's cool and valuable. They don't. Well, whose opinion matters in that conversation?

12:45 >> The only person that's buying. >> Yeah. Exactly. Exactly.

12:50 >> Yeah. I mean, I think that that's, you know, a super powerful part of that prospecting. So like from a from a perspective of getting people to start

12:59 this action like are there like do you have recommendations that are like hard tactical like do xyz just start here and then

13:09 we'll evolve or how do you handle like the get that jump started aspect. So, um, my first job out of college, I

13:18 worked for CO USA and I covered parts of three states.

13:23 >> And basically, I was handed a phone book filled with account listings with street address and phone number.

13:31 >> Yes. >> And my boss said, "We're not really sure how accurate any of this information is, but if you'd like to keep your job, you need to go through this entire book and

13:40 find out who's really doing business with us.

13:44 Right. There was no option behavior. It wasn't like he said, "Hey, you can sit back and wait, see who calls. We're pretty big company. People will contact

13:53 us." >> Yeah. >> Like it it it was just noise. So to some degree, the most important thing a leader can do is remember that, you

14:04 know, every company is driven forward by intelligent choices and action, >> right? So you you've got to be able to make intelligent choices and then you've

14:14 got to take action. And if you're programming, if you're coding, if you're building a product, if you're whatever you're doing, you've got to make

14:21 intelligent choices. Well, sales, which is, you know, half the business because you have sales and overhead, the two departments in every company, like sales

14:31 is it requires intelligent choices and and action.

14:35 >> Totally. So, you know, you got to figure out who do I want to talk to and how do I get them to talk to me?

14:42 >> Yeah. Yeah. So, I mean, would it be fair to say like, hey, if you aren't if you don't have a prospecting motion, there's no excuse. Just go find a phone book and

14:52 just start and then you can start adjusting from there, but you have to get going.

14:57 >> Yeah. So my son is 25, works for a software company um as a enterprise BDR and they've never had an enterprise BDR

15:08 succeed in his company yet. And he's at 300% a quota because he sat down and said, "Okay, who do we actually sell to?"

15:17 >> Mhm. >> And what companies have the same demographic qualifications as those companies?

15:22 >> Yeah. And he spent six months refining his list in the first week and five months and three weeks calling those people and figuring out whether or

15:32 not they were even good prospects. >> Yeah. >> And ironically, he has filled his pipeline enough to to make his annual quota.

15:41 >> Yeah. Ironically, are we sure that's the Are we sure that's the right way?

15:45 >> I mean, it's I Who saw that coming? >> Yeah. Right. Who would have ever guessed the person being proactive got some results? proactive >> that that could pick up the phone and

15:53 call people that look like the people that already pay you. >> Yeah. >> Would would actually generate people interested in paying you.

16:00 >> Yeah. So with those intelligent choices, you know, obviously there's some experimentation. I know that for Sandler there's always a question of more,

16:08 better, different, you know, how does your process look for, you know, kind of walking through that? What does that look like in a in a practical way?

16:17 So I I I believe that you most businesses have existing clients, >> right? The reality is most businesses are going to make about 90% of their

16:27 revenue from their existing clients this year, if not more, right? An effective SAS business is going to make about 120% of their current year revenue over the

16:37 next 12 months from their current clients because they're always looking to expand.

16:41 Um, in in my world, the first thing I do with any of my clients is I stack rank their existing clients.

16:50 >> Figure out who produces 80% of the revenue and then find lookalike audience.

16:56 >> Yeah. >> And then we just start calling and walking in and visiting.

17:03 >> Yep, that makes sense. Um, so as you're so somebody who let's say doesn't have those existing clients and so they're maybe like trying to you know fighting a

17:12 little bit of an uphill battle trying to figure out baby steps.

17:17 >> I I would I would guess if they don't have any existing clients, they've started a company.

17:22 >> Yeah. >> And they have an idea of what their user looks like.

17:28 >> Right. So, I had a company that was started that when they became a client of mine, they were relatively new. They were selling conveyor belts to

17:36 manufacturing facilities in a five-state area, right?

17:41 >> Mhm. >> And and they didn't really have they couldn't call on existing clients because it was a new business, but they had an idea that, you know, businesses

17:51 in these industries are going to be buyers. Mhm.

17:56 >> And I said, 'Well, how many of those are available? How many facilities are in that SIC code that you think you're targeting? And they said, there's about

18:05 3,000 in the five states that we that we want to cover. I said, "Good. You know, there's four of you, so you can divide

18:14 the list in four." >> Yeah. >> And the one guy said, "No, no, I'm a software guy." I said, "Okay, there's three of you now."

18:21 >> Yeah. >> Right. You just need to start picking up the phone and asking questions >> and figuring out whether or not your theory that this is something people

18:29 will buy holds water. And if it does, you're great. And if it doesn't, then you got to make another theory.

18:36 >> Yeah, that's great. And then actually do the work, right? Not >> you got Yeah. Now, the reality is, you know, the person least likely to succeed

18:47 at selling in a repeatable way is a is the owner or founder who's super excited about the new business they came up with and wants to tell everybody about it.

18:57 Because then they never really learn because they don't give prospects a chance to say, "Hey, here's why I'm not interested. Here's what could be different that would interest me." But

19:06 that's the process. You still have to go call people. You still have to talk to them.

19:10 >> Yeah. Yeah. So let's okay so let's go back to the right we have our 80% we figured out the similarities we're now going to target them intelligently

19:20 uh you know we can go up or down with like how the quantity so that's their more and then as we're doing our messaging I mean are are you how are you

19:27 tracking or saying this messaging can be better this messaging could be different or we can reach different like how are you then getting >> AB test >> AB test

19:36 >> AB test AB test the voicemails you leave you know the the thing about B2B sales sales calls, 95% of them go to voicemail.

19:44 >> Yeah. >> One of the questions I love asking my my uh my clients, the sales people that come in is, uh, show me three different

19:53 versions of your voicemail script >> that you have prepared so that when you get voicemail, 95% of the time, you're not just winging it, >> right?

20:02 >> And they, nobody ever has a voicemail script prepared. Nobody's ever thought about it. They just kind of start talking when the voicemail kicks on, >> which doesn't make any sense.

20:12 >> I mean, yeah, I'm with you 100%. I was trying to think of an excuse for that and I just couldn't even think of a funny one for it. But

20:21 >> yeah, there's nothing I mean, it doesn't if something happens to you, like I had a guy that was selling uh he was selling fiberglass bath inserts

20:31 in a house and you know he it was a great sales call. They were going upstairs. They walked in the master bedroom and the lady goes, "Oh my god,

20:40 my cat's having kittens. You need to leave." >> Mhm.

20:44 >> And like he hustled out of the house and and you know, he came to training the next week and he's like, "Well, what do I do in that situation?" And I'm like,

20:53 "Well, if it happens once, there's nothing you can do about it. It's just an off-the-wall thing." But if you if three times in 90 days you go into people's houses and you're going

21:02 upstairs at the end of a great sales call to measure their bathroom and and the homeowner says, "Oh my god, my cat's having kids. You need to leave." Right?

21:10 Then you better have a plan early in your sales process to say, "Hey, before we get wrapped up in this, is is your cat pregnant? Is is there like is there

21:20 any reason that your kittens would be born this evening and interrupt our sales call?" Right? But but voice messages, you get voicemail 95% of the

21:30 time >> and and you better have a plan. And it's even worse now with Apple's live voicemail.

21:37 >> Yeah. >> Where you can see the voicemail being left and you get some dope just rambling on with no point. You're not getting picked up. You're probably getting

21:45 blocked. >> Yeah. Well, the other fun one is trying to navigate the uh the phone screening where it says, "Give your name and your purpose." you're like, how am I possibly

21:54 going to give my purpose in two words? And maybe that's something I need to work on and that's, you know, like a a training issue on my end, but that

22:02 becomes very like tricky uh to be able to figure out how do I be concise? How do I navigate these voice screenings and from my own AB testing, I find if I just

22:10 say my name, it's 10 times better than trying to get anything for my purpose in there to this point. So, >> yeah. Yeah. I don't think you can you

22:19 can summarize your purpose unless you're comfortable saying it's a sales call.

22:24 >> Yeah. Yeah. That's a good point. Cold calling you. And if they don't feel like talking to a cold calling person, great.

22:30 Even if you're, you know, the right the right person for the problem they're facing.

22:34 >> Yeah. >> Yeah. But but I think people are a lot more receptive to to an honest it's a sales call than to an evasive,

22:44 you know, the the reason I'm calling is to follow up on an inquiry we had from a drop in card that I got from a magazine.

22:50 I mean, it doesn't make any sense. >> Yeah. Oh, I start most of mine with a, hey, this is a cold call. Feel free to hang out. what I'm calling about, you know, and

22:59 >> it's disarming and it feels good like personally just from a selfish perspective being able to say that feels great because then I'm like no >> we're up front.

23:08 >> My my favorite start to a cold call is hey this is a cold call. You probably hate getting them as much as I hate making them.

23:14 >> Yeah. So it's a perfect rapport builder in Yeah. What is that? Two seconds to say two three. Yeah.

23:22 >> Yeah. >> So you're going through this. you need to AB test to then let yourself know what are these answers. Um you know do

23:32 you have any like standards on what you're doing for that data gathering? So as in like do you always aim for statistically significant amount or do you go hey we've made 100 calls this

23:42 week. I know that's not representative from a pure mathematical perspective but clearly like this messaging is working or this ICP isn't working. Let's move

23:52 fast. and how do you handle that? >> So, I'm I'm not looking for statistically valid research level data,

24:01 right? If I can make a hundred calls and I get two different sets of results, I go with the one that looks better.

24:05 >> Yeah. >> And and you know, my clients as a rule, they're not GM, >> right? So, they when they set a policy, it's not set in stone forever. They can

24:16 change it, right? And so you you AB test one week, you you pick A. The next week you're testing A against C, you end up

24:26 with C being better. You know, you might in three weeks, four weeks, you might go back to B. You might go back to A and just try it again.

24:34 >> But the other thing is when you have multiple salespeople, you're going to have multiple versions of A that work better, right? Because I can't sound

24:42 like other people. I grew up on the East Coast. I sold bag from cleaners doortodoor. I'm comfortable saying things that other people don't want to say.

24:50 >> Yeah. >> Right. So I you you've got to have >> you've got to have the the principle behind the practice as much as the practice and then you got to make sure

24:58 that the people that are executing it are comfortable. >> Yeah. Would you recommend that at all times AB test or would you say that there is a certain threshold where you

25:06 go you know C we landed on C it's crushing it. We just pour the gas on more and just get more phone calls out.

25:14 I I think there are principles that you can always stick to, but I don't think there are words you can always stick to.

25:19 Right? Script based selling doesn't work as I tell everyone, which is ironic because that's a script. Um, but >> yeah, >> the reality is you've got to sound like

25:28 you, >> right? So that would be like, you know, AB test to figure out like the phrases, the words, start getting that out for

25:39 everybody, get everyone kind of aligned, but then continue to have flexibility in what you're saying, just as long as you're within the principled set of what

25:48 the the script is supposed to say, not just reading it every time.

25:53 >> Yes. >> Yeah. >> Y >> that makes sense. Would you think that that's also kind of tied to, you know, no market is stagnant. So, as you're

26:02 continuing to have these conversations, you know, the for lack of a better word, uh, the buzzword that's catching people's ears and causing them to listen

26:10 might evolve over time. Like, I imagine, you know, AI is everywhere in in terms of topics. So, now conversations are changing. Um, and so that would be

26:19 another good reason to continuously be monitoring and AB testing.

26:24 Yeah, it's no man goes through the same river twice because the river is not the same and neither is the man, right? When you're making sales calls,

26:32 you're not talking to the same people about the same things all the time. And, you know, now we're talking about interest rates and inflation and fuel costs and labor mismatch.

26:43 >> But we weren't talking about that before. Before it was, you know, different problems. Three years ago, different problems. Five years ago,

26:52 different problems. One thing that's consistent is that Inc. Magazine for like 18 years consecutively now has said the number one problem for small

27:02 business owners under $50 million is generating new revenue.

27:06 Yeah, but don't but don't worry, inbound is the rage. Prospecting is dead. Do not try to reach out to people and have

27:15 conversations to see what's happening. >> Yeah, eventually they'll call you.

27:19 >> Yeah, >> right. Yeah. >> You just have to you you have to hang on longer than they ignore you.

27:25 >> Yeah. Which is that's got to be a real a real comfort at night laying in bed being like maybe tomorrow. Maybe tomorrow we'll get that inbound. That's

27:34 >> explain to your banker that they're ready to call you. Yeah.

27:38 >> Right. Operators are standing by. >> Yeah. Oh man.

27:43 >> So >> that's interesting. I think uh the thing that I've been noticing with like a lot of like the conversations is

27:52 around AI and I think the one that like everyone talks about like the productivity with it and the thing that I keep like seeing through is like it's

28:00 trust is what really is becoming the real topic underneath all of it and the companies that are going to lean into that trust idea are going to start winning because productivity is no

28:10 longer a competitive advantage. There's no moat there. Now, can I trust the person that I'm working with? And to do that, you're going to have to pick up

28:18 the phone and start talking to to people, not AI bots, to people to start establishing, can I trust you with my business? Can I trust you when I need

28:26 something? Can I do that? And like I think that really puts the emphasis back on, you know, a cold call is just going to become more powerful as we go into

28:35 this and prospecting has become even less of an option as I mean less of an option which is kind of a dumb thing to say at this point after this conversation but you know like

28:46 >> I mean the reality is the the reality is in today's world you know you can you can be efficient or you can be effective.

28:56 >> Right? Efficiency is all AI. Effective is all personto person.

29:01 >> Yeah, definitely. Well, hey, we're we're at our upfront contract of the 30 minutes. So, I really appreciate I love this, >> you know, straightforward approach to

29:12 here are the facts. Here's how it has gets it gets done. But, um, totally resonates with how I like to think about those types of things. Uh any final

29:21 parting thoughts or words that you really want to drive home to summarize kind of your POV on this?

29:27 >> Hey, I tell everybody that I work with and everybody I talk to, you don't have to prospect, your competitors will.

29:36 >> Another great nononsense answer. I love it. Awesome, Matt. I really appreciate the time today. Yeah. Thanks.