CSO Insights recently completed its annual global sales force survey and has come to some interesting conclusions. While sales objective achievement has increased overall, 2012 sales objectives are being projected at their highest level in recent years coupled with the lowest confidence levels in actually achieving them. One of our core beliefs with sales objectives is you can’t expect increased performance without increased support. CSO Insights’ data seem to support this:

“Increases in revenue goals need to be backed by investments in sales rep efficiency and effectiveness,” added Jim Dickie, managing partner, CSO Insights. “The study uncovered a wide variety of factors that can positively impact sales performance including optimizing lead generation, better alignment of the sell cycle and the buy cycle, and leveraging CRM 2.0 technologies such as sales collaboration, sales management analytics, and sales intelligence. Best-in-class sales organizations that focus on formalizing their sales process and deepening their relationship with customers are significantly outselling their competitors.”

From our point of view, those organizations willing to provide updated training on a more consistent and effective sales process, coupled with better market intelligence, are the ones winning in the local media space. So much of what we are seeing are inconsistent sales methods, lack of central management control over the sales process, more managers who are player/coaches, and a void in preparing media salespeople to have a deep strategic discussion on how digital media works with their core media or how digital media supports a small and medium-sized businesses’ needs and goals.

Recently, BIA/Kelsey has developed many new tools and research to help support managers and salespeople with market intelligence, education on the value of digital media and, more important, how digital media and traditional media can be sold side by side. Our core philosophy is that media salespeople should be the value experts with any of their portfolio products. As the value expert, they need to understand the customer’s challenges and the industry’s challenges so they can translate their portfolio of solutions to the customer’s needs and goals.

Sales is becoming less about personal relationships and more about information relationships. There is too much information on digital media available for SMBs and even brands to process which means the salesperson has to fill the role of information interpreter to become the valued consultant. Translating the myriad technical functions and features of digital media into concrete value messages, supported by simple to understand facts and figures, is what SMBs crave.

So while contemplating how to move the sales needle, think about how best to support the sales team and what support is needed to achieve even higher goals in 2012.

SMB marketing companies have forgotten that local businesses still see calls as a key driver of new business. That’s the opinion expressed by Marchex Executive VP Matthew Berk during today’s session on “Converting Calls to Local Sales.” To succeed in the calls space, Berk emphasized the need to “go deep” and focus on quality. He defines quality calls as those that represent a proxy to conversion.

Key takeaways on emerging industry trends include:

–The explosion of mobile is about being call-ready

–Mobile search and discovery coincides with smartphone penetration, growing 5x in the past two years

–Computers are becoming more and more like telephones (i.e., Skype and Gtalk)

–Lower cost per lead + better outcomes = lower churn.

–Better outcomes means better calls

Court Cunningham, CEO of Yodle, made news at ILM West this afternoon, announcing a three-year deal with Canada’s Rogers Communicationsduring a 15-minute Q&A with BIA/Kelsey analyst Bobbi Loy Luster. Rogers is a leading communications company in Canada. Its deal to use Yodle’s technology and services to sell online media solutions bundles to Canadian SMBs is a potentially serious challenge to Media, arguably Canada’s reigning SMB player.

Cunningham also revealed that Yodle has been added to Google’s Premier Partner List.

Cunningham and Luster used most of the time slot to go through Yodle’s local sales best proactives. Yodle has been around since 2005, and currently has 28,000 customers, adding 1,000 new customers every month. Cunningham notes that the company now has a large enough customer base to produce data sufficient to accurate predict its ability to generate quality leads.

Yodle used inside sales, after having experimented with a mixture of inside and outside sales. Cunnigham said experience has shown his team that outside sales can get higher budgets from SMBs but they noticed no significant difference in churn. What does impact churn, he said, are low price points and bundling.

“The SMB is confused,” he said. “What they want is a trusted provider to serve as their marketing deparment.”

Looking deeper at retention, Cunningham listed key elements as setting expectations, delivering on those expectations in relatively high touch service environement (Yodle has business development reps to acquire customers and and account manangement to service them). Then reporting back to SMBs with the results.

So it’s obviously critical that products perform as expected. It also points to the need for a controlled sales environment – another benefit of having inside sales. It’s much easier to monitor the sales messaging of an inside than an outside sales rep.

Cunningham said Yodle initially had higher price points, ranging from $800 to $2,000 per month. The range now starts much lower, at around $150. As Cunningham notes, “Eighty percent of our customers have fewere than eight employees.” The company’s cheapest product promises six to 10 leads per month.

The purchase funnel that takes consumers from awareness to transaction and retention has been an article of faith among marketers for many years. TV advertising, for instance, is “upper funnel.” Yellow Pages, at the point of sales consideration, has been “lower funnel.”

Google has other ideas. Any purchase consideration must now consider the impact of search (of course). But the impact of ratings and reviews, check-ins and other proxies and extensions for word of mouth also play into it.

Speaking at San Diego Interactive Day, Google Director of Local & B2B Markets Sam Sebastian said that shopping drivers are now based on “stimulus,” “the first moment of truth” and “zero moment of truth.” The zero moment of truth — ZMOT — is based on passive information sought by consumers.

It is reflected well in an evaluation of Google data from January 2007 to December 2010 in the U.S., U.K., Brazil, France and Germany. During that period, searches for reviews were up 98 percent, searches for coupons were up 339 percent, local search was up 177 percent, and searches for weight loss were up 154 percent. Eighty-three percent generally rely on “trust places” like user ratings or product reviews, said Sebastian, citing data recently released by Booz Allen.

“New behavior drives a surge in search volume,” said Sebastian. “You have to sell, have to optimize and sell to repeat customers. [Especially when] they are making the emotional part of their decision.”

We’ve been starting to see the signs of recovery for the past few months. Companies that have been cutting costs and back office expenses are now realizing they need to get the sales end of their businesses moving again. Throughout the recession, salespeople who could at one time demand higher base salaries, fringe benefits, signing bonuses and vacation time suddenly found themselves under-employed, unemployed or struggling to find a better job. Many simply hunkered down and accepted lower pay and scaled back commission structures because they did not want to be searching for a job in a down economy. Employers that were hiring salespeople suddenly found themselves in a favorable position with more prospects in the past 12 to 18 months than ever before.

Now we find ourselves in 2011 with all of the economic signs pointing to a slow recovery. Our view is that the need for new salespeople or people with enhanced skills will begin to ramp up much like we saw prior to the economic downturn. A recent Sales Gravy survey indicated “75 percent of sales companies plan to increase their sales force and 23 percent plan to maintain their headcount.” Having worked for a media sales company myself, these figures indicate that through attrition and salespeople trading up to larger or more attractive sales organizations, there is a battle brewing for qualified salespeople. It is unrealistic to think attrition won’t increase in a strengthening economy.

Another trend continuing to heat up the battle is the move away from transactional single product selling to consultative multiproduct selling with a focus on online and mobile products. As more local media companies seek to move toward multiproduct portfolios filled with digital products, they will inevitably be seeking the same types of prospects in their hiring process. Salespeople who understand how to integrate traditional media with online and mobile media continue to be highly sought after, leading to a shallow pool of candidates who can and will demand higher salaries and benefits. According to the SalesGravy survey, “77 percent of media companies surveyed expressed moderate to significant concern about the availability of sales talent to meet their hiring needs.”

We recently spoke with Robert Hawthorne of Hawthorne Executive Search, a firm specializing in media sales and sales management recruitment, about this subject and he relayed some additional challenges looming for sales recruiters. “With the elimination of relocation benefits, it’s extremely difficult for candidates to sell their homes quickly and move to a new location,” pointed out Hawthorne. “With home values slipping, many candidates are locked into their local area for jobs, which further shrinks the labor pool.”

Hawthorne is also seeing that “candidates who weathered the economic storm are starting to see the advantage of exploring the marketplace creating unexpected turnover in media sales teams.” One new challenge in the hiring battle is that online and mobile companies are moving toward creating their own sales teams rather than relying on partner organizations, thus creating increased demand rather than just replacement hiring. “The increase in new products and the opening up of new markets is creating new demand for sales talent and putting pressure on legacy sales companies,” Hawthorne said.

Those sales organizations that have not increased their investment in recruiting and training or retooled their hiring process and candidate profiles, or have relied on front line sales managers to make hiring decisions, could find the battle even tougher. Traditional media companies in particular may be even more challenged by what Hawthorne describes as the three Cs, “You aren’t cool, you don’t offer enough compensation, or you can’t help the career climb.”

Media companies that are perceived as “hot” will have the advantage including online and mobile media companies that have traditionally been more aggressive in leveraging their “cool factor” and compensation models to steal or win talent. Hawthorne believes “that local media is still a good bet for salespeople because the unemployment rate in this sector is relatively low and the products being sold are from recognizable brands.”

BIA/Kelsey has been investing time and resources in understanding how this battle will play out. In the coming weeks, we will be releasing an Advisory on this topic as well as offering continuing coverage of new approaches and success stories from traditional, online and mobile media companies. We welcome feedback and case studies from our readers, which may be featured on our Local Media blog.

The Groupon deal-a-day model — “no money upfront, but we’ll take up to 50 percent of the coupon value” — has been met with high satisfaction. Groupon’s internal data show that 97 percent of participating SMBs want to do it again.

But the model has been taking real heat this week from some SMBs on the blogosphere. The complaints largely center on their poor judgment. Specifically, they hadn’t established a ceiling on the number of Groupons that can be sold. This can pose a real problem for SMBs, which are typically willing to take a loss on every coupon to build their business but can be drained if too many money-losing Groupons are sold.

Other allegations are circulating about unscrupulous businesses that manage to get onto Groupon. Specifically, a photographer in Atlanta offered a deal that was too good to be true, and uneconomical. While it isn’t clear what advantage this business got — other than some upfront cash for a portion of the deal — it does suggest that Groupon’s promise to carefully vet every business that it works with may have gotten stretched too thin by its rapid growth.

The recent hubbub started with a post by Posies Cafe in Portland, Oregon, which agreed to offer $13 of food for $6. It did so after a Groupon rep advised the owner that Groupons do better when they are discounted more than 50 percent. But Posies was unprepared for the avalanche of Groupons sold to Portland consumers, who bought 1,000 Groupons and overran the little upscale cafe for several months. Ultimately, Posies’ owner said she suffered such extreme losses that she had trouble paying her rent and her staff.

“It has been the single worst decision I have ever made as a business owner thus far,” she wrote on the Posies blog this month, saying she was down $8,000 in total — apparently after subtracting food and service costs, and the costs of Groupon redemption.

The math here is kind of interesting. While Posies would normally lose $7 of the face value of a $13 Groupon, and Groupon would then also eat $3 of the $6 Groupon — the loss was even higher. Apparently, Groupon keeps all the revenues for Groupons priced under $10.

Objectively, it still isn’t clear why a promotion costing $10,000 would have such a catastrophic effect on the cafe. In many cases, consumers typically spend well in excess of the coupon value. Moreover, the cafe would theoretically be able to cut back on advertising during this period.

Still, the troubles at Posies Cafe struck a nerve. At the very least, it suggests that certain finite service providers are not ideal users of Groupons.

Still, we believe that deal a day is a touchstone for local online commerce that is going to have a major effect on SMB marketing as it continues to evolve. We especially like what Groupon investor and former AOL EVP Ted Leonsis said on his blog in a post titled “Victims.”

“In the last ten years, two new methods have emerged to help small businesses become successful: Targeted search marketing from people like Google where you bid and pay for targeted search words and clicks and now social shopping sites a la Groupon. Both methodologies are accountable; are focused on geo-served audiences; can be used creatively; and can drive traffic into stores or make the phones ring. And best of all small businesses only pay when the programs work.

“And more and more these programs really do work. Your neighbors want to support you. They want to sample your wares. They want to come in and buy from you. Group couponing is a powerful tool and a positive breakthrough for small businesses.”

We had the opportunity to sit down with industry leader MediaTrust to understand the major changes in the in the performance marketing (pay-for-results) category and the challenges of developing a cost-per-lead (CPL) model.

MediaTrust began as an affiliate marketing company, but was continually challenged by the deceptive practices of many affiliate marketers and publishers. Understanding there was a better approach, MediaTrust began vetting each of its publishers and affiliate marketers to ensure the quality of its network and to better assure brands would get quality campaign results. As this strategy gained momentum, MediaTrust evolved into a software as a service platform to better serve both publishers and brands. Today, the MediaTrust platform empowers advertisers to use e-mail, display, search and social media advertising to deliver a site visit, lead or sale. MediaTrust’s success was recognized by Inc. Magazine, which named them the ninth-fastest growing U.S. company in 2009.

Pay-for-results campaigns rely on understanding average customer acquisition costs and lifetime value of an acquired client to know how to effectively build a cost-efficient campaign. According to Trip Foster, VP of marketing, “our goal is to provide opportunities further down the sales funnel because advertisers are willing to pay more the closer we can get them to the transaction.” Publishers have become more willing to work on a performance basis because they are better able to monetize their excess inventory with known brands and increase revenues on what would have normally been sold on an ad network as remnant inventory. “There is no scarcity of online inventory; the real challenge is uncovering inventory on quality sites where brand value is protected and predictable results can be achieved.”

Foster describes MediaTrust’s performance marketing platform as “trusted outsourced marketing, bringing together publishers and online marketers who can provide quality leads or transactions based on a specific cost per acquisition.” Like most multimedia approaches, MediaTrust is platform agnostic focusing more on where quality leads and transactions come from. “We spend a lot of time testing campaigns to determine how best to drive ideal cost per acquisition and are willing to seek out new publishers or affiliate marketers who can best optimize a campaign via online direct response mechanisms such as search, display advertising, re-targeting or e-mail marketing.” The recent acquisition of Bardon Advisors, an L.A.-based CPC and affiliate marketing firm, allows MediaTrust to serve the full online sales funnel with cost per click (CPC), cost per lead (CPL) and cost per acquisition (CPA).

When asked about the growth of the performance marketing category, Foster said “the majority of online campaigns will move to a pay-for-results model. Even brand advertising is tied in some way to a specific response mechanism for more precise campaign measurement and ROI. The local portion of paying only for results, on the other hand, will be a more complicated scenario given the challenges of a smaller scope of geography, more limited inventory and possibly cost-per-acquisition numbers that might not make sense.”

As marketers continue to move away from impression-based online models, performance marketing is seen as a more direct way of measuring ROI, allowing brands and advertisers to maximize spend and grow their business. While multimedia publishers possess a number of online inventory options within their own ad networks, driving significant and affordable acquisition costs requires more specialized tools and partners to build up this portion of their business. As publishers and even broadcasters look to better maximize their online inventory with brand advertisers, online performance marketing seems to be a smart play.

Plan to hear more about MediaTrust’s views on leads-based products and selling at our upcoming Directional Media Strategies conference in Dallas, Texas, where Foster will provide his views on the category on the panel titled “Leads-Based Selling: Salvation or False Hope?”

For the past year and a half, we have been answering questions about and consulting with our clients on sales transformation and consultative selling (see here, here and here). One of the key aspects of many of the questions we receive is “what has fundamentally changed, how has it changed and what do we need to do about it?” A recent article from BNET Insight’s Geoffrey James crystallized some of our thoughts on how the Internet has both changed the sales process and created an even greater need for sales skills and support. According to James:

“Sales reps were valuable to a customer because they knew product details and how to write the order. And they were valuable to their own firm because they could convince the customer to buy today, rather than tomorrow (or from another vendor).

“The Internet changed all that. Customers can now retrieve product information, order product, check delivery status, contact customer support, and so forth, simply by getting online. Because customers no longer need a sales rep to perform these functions for them, some pundits predicted that the Web would ‘disintermediate’ sales, leaving millions of sales professionals out of a job.

“What happened instead was that the Internet made the sales function more important, even while changing its nature. While the Internet made the traditional sales function obsolete, it also wreaked unintended consequences. The Internet created what social psychologists call a ‘tyranny of choice’; customers have access to so much information that it can become more difficult to make a buying decision.”

Understanding this juxtaposition between making sales transactions easier and complicating the process with an overwhelming number of choices explains the need for consultative selling to help local advertisers understand and navigate complicated media choices. While consultative selling has been a “nice to have” sales process, broader media portfolios, and, as James coins it “the tyranny of choice,” local advertisers need more insight and assistance to make sense of all the new options and to assure them they are making wise use of their media budgets.

Many sales organizations are seeking new ways to train their sales people, focusing on frequency of contact, proper discovery and fact finding skills, more listening skill development, and local media education so salespeople understand all forms of local media. The goal — enabling salespeople to guide SMB media choices and advise on appropriate investment levels. Salespeople are now expected to be educators, problem solvers and above all local media consultants who can best match media options with budget and business objectives.

This change in sales process expectations has already occurred, but sadly sales organizations have been slow to adapt due in part to the economic slowdown leading to a lack of investment in training and sales strategy development. Adapting quickly means less of an interruption in sales revenue growth and reduced sales staff turnover. Cutting back on capital investments can only take an organization so far, the time is now to invest in transitioning the sales process, fully embracing consultative selling, and developing new sales strategies that make sense in a connected world where information overload is creating new sales opportunities. Welcome to the new world of sales.

I like the “For Dummies” series a lot — more than 1,700 different Dummies books have been published since 1991. But it never occurred to me that there could be a volume geared toward local online advertising. It occurred to Yodle CEO Court Cunningham, who has now co-authored “Local Online Advertising for Dummies” with business consultant Stephanie Brown.

The book is a good reference for our industry. It is easy to understand, full of practical tips and leaves no stone unturned. Every time I’d say “I bet they forgot that,” the next page would prove me wrong. I like also that the book is a straightforward guide, and plays no favorites.

I imagine Yodle will pass out a zillion of these to its small-business clients. It isn’t a bad idea for any of us to give to people who would like a practical guide to our industry. It isn’t, however, designed to be a book for industry insiders. Here’s the Amazon link.

The Interactive Advertising Bureau, celebrating its 15^th anniversary, is holding its annual leadership meeting at La Costa in Carlsbad, California. The sold-out meeting, dubbed “Ecosystem 2.0,” has attracted 650 attendees, up 30 percent from last year: a further omen of recovery in the economy. Over the years, we have actively helped IAB develop its leadership tracks in local, so it is good to see the organization on very sound footing.

24/7 Real Media Chairman David Moore, in an opening keynote, noted that 12 percent of ad dollars are now online, but online share remains disproportionately low, considering that 25 percent of viewing time is spent online. The audience’s increasing fragmentation forces publishers to look for new revenue paths, he added.

The clearest path to recovery is to focus on building more premium content, even though it inevitably means that subscriber charges need to be added. “Totally free content is dead,” said Moore. But that isn’t the end of the world. In 1982, cable TV was beginning to add unique networks, subscriptions were $6 per month. Now they may be $100 a month.

If an “EZY pay” system were instituted for content at 10 cents per access, that would be like charging a CPM of $100,” Moore suggested. That would be far more lucrative than what most publishers are getting.

Moore also predicted that digital would be the No. 1 ad medium within the next five years, with online video advertising leading the way. But first, the industry has got to adopt real standards and simplify the workflow for agencies and concentrate on finding new ways to make commercials more interesting to the consumer.

“You can’t be afraid to be disruptive,” added Moore. “You need to be more aggressive. You have to interrupt the consumer experience with ads. But do it in a way that is interesting and targeted.”

IAB President Randall Rothenberg, in his opening comments, said the key to advertiser success was to focus on the year-after-year development of brand building, which is a synonymous effort with charging premium prices, i.e., BMW and Johnson & Johnson. “It is about being a part of, not apart from,” said Rothenberg.