Does A Product Manager Need To Know How Sales Work?

Who Is a Product Manager? 

A Product Manager is responsible for setting the roadmap, strategy, and feature definitions for a product or product line. In addition to product forecasting, marketing, and profit and loss responsibilities, a Product Manager has other duties. Based on customer demand, Product Manager skills develop a product vision that differentiates and delivers unique value. Developing products is a rewarding experience. You can find deep satisfaction in your work as a Product Manager when you feel a sense of responsibility and commitment to your product. 

Now we will discuss the Product Manager’s roles and responsibilities. 

Responsibilities of a Product Manager 

Some of the core Product Manager responsibilities are as follows: 

• The ability to understand and represent the needs of the user. 
• Analyzing the competition, the sales rep collects Discovery Prospect information for a product and defines its purpose. 
• Assuring that stakeholders are aligned around the product’s vision. 
• Making sure that product features and capabilities are prioritized. 
• Making sure that a shared brain is created across larger teams to empower independent decision-making. 

10 Things Product Managers Should Know About Sales

• What is a sales cycle?  
• What is a complex sale?  
• Who’s your champion? 
• Sales reps need good personal skills  
• It’s all about relationships  
• The customer is less interested in your product than you think  
• Sales reps don’t have the vision; they have compensation plans  
• The sale isn’t over until the fat lady sings, and then some?  
• The win or loss analysis  
• What it costs to sell  

What Is a sales cycle? 

Product Managers must understand the sales cycle well in order to provide better support for their sales forces. Stages in a sales cycle are described as follows: 

• Prospecting 

Prospective customer identification is the process of identifying potential clients. Research, tradeshows, websites, mailings, and other methods can be used to do this. 

• Qualification 

During this stage, it is determined whether or not a sales opportunity exists with a particular prospect. The following questions must be answered in order to qualify: 

Does the product offer fit the prospect’s needs? 

What time frame does the prospect have in mind for purchasing the solution? 

Do you have a budget and authorization to make a purchase? Does the person who showed interest in the product really need a solution? 

When these questions are answered, the sales cycle moves along, the salesperson moves on, or the prospect’s organization shifts focus. 

• Discovery 

The sales rep collects prospect information.Prospects’ pain point is discovered. Prospects buy because a solution solves their pain points. 

• Solution 

Sales reps demonstrate how their product will solve prospects’ pain points. Demonstrations, pilots, or visits to references are some of the ways to accomplish this. 

• Implementation 

Handing off the solution to the client and executing the sale agreement. 

• Service, upsell, and support 

Customers’ satisfaction and willingness to move forward depend on these actions, which the sales reps do not manage. 

• Referrals and references 

Revenue can sometimes be less important than these factors. Reps get referrals from customers and get approval from customers to act as references in this stage. 

What Is a complex sale? 

‘Complex’ sales are typically found in enterprise B2B systems sales. The following are examples of complex sales: 

In the process of selling, multiple people are involved. There can be a great deal of difficulty in selling to multiple people–each with different agendas–at the same time. This is sometimes referred to as ‘buying by committee. 

Budgets have been allocated for the purchase. Placing an order usually requires approval from a committee or higher authority. 

Initial interest in a purchase is followed by a lengthy period of consideration. 

Who’s Your champion? 

In order to make sure that the sales rep can effectively champion the project and influence the buying decision, one of the most important things he or she can do is to identify who will be the person to make this decision. The same person may not perform all of these functions. 

• Champions are people who believe in the product and are aware of the pain. Sales reps are shepherded through the company’s political structure and purchasing process by this person. Having a strong political champion will make selling it easier. 
• A decision maker is someone who has the authority to make a purchase decision. People who want to resolve pain must have a discernible concern. 
• Ultimately, the product will be used by the user. In general, they can influence the buyer if they do not represent the buyer. 
• By verifying the price and terms are reasonable, the purchaser serves as a gatekeeper for the purchasing department. An important factor in the sales process is the purchaser’s approach. Buyers can facilitate a process if they feel positive about it, or they can obstruct it if they feel negative. 

For a sale to close, the sales representative must engage with all of these stakeholders and provide a solution that addresses their concerns. 

Sales Reps Need Good Interpersonal Skills 

The buying organization is involved in multiple stakeholder relationships in complex sales. Champions, decision-makers, and purchasing personnel are usually involved. Senior management may also be involved. There are often conflicts between the agendas of each of these stakeholders. The sales rep’s duties are identifying the decision-making process, knowing the players involved, knowing how to influence that process towards a decision, and satisfying the players’ needs. Personal skills are required for this. Knowledge of features isn’t enough. 

It’s All About Relationships 

When customers trust someone, they buy from them. In order to make a purchase, there has to be trust between the prospect and the sales representative. The greater the risk, the more it becomes about trust and credibility. 

Product Manager representatives should be familiar with the product to the extent necessary to gain the trust of prospects. In some cases, sales reps can meet their quotas without knowing much about the product. Technical sales may be an exception to this rule since domain expertise (with regard to technology) is crucial for instilling trust in the prospect. 

The customer Is less Interested in Your Product Than You Think 

The benefits your product offers your customers are what compel them to purchase it. Their main concern is that the product complies with regulations and doesn’t violate any red lines, such as opening firewall ports or compromising security. They aren’t too interested in how it works as long as it has a clear benefit for them. Focus all your efforts on the product’s benefits to the customer in your general approach, sales materials, and training. The product’s features enable benefits to be achieved, not the features themselves that are the objectives. Positioning based on problems is essential in this regard. 

Sales Reps Don’t Have Vision; They Have Compensation Plans 

A sales rep’s behavior is influenced by his or her compensation plan. A compensation plan is a way for a company to tell reps what it wants them to do. Sales reps will maximize their commissions by selling what maximizes their compensation. Unless your compensation plan is synchronized with your objectives, you shouldn’t rely on other means to motivate them to sell. 

The Sale Isn’t Over Until the Fat Lady Sings, and Then Some? 

For Product Management, nothing matters more than the customer’s signature on the bottom line. In order to close a deal, sales reps may request changes to the product. To keep in mind are two things: 

• Spending resources before a contract is signed should be very, very cautious. Regardless of the importance of the customer, no resources should be devoted to the product until the customer signs the contract. You should not be intimidated by a sales rep who tells you that the deal is almost closed or that the customer is about to sign. Last-minute mistakes can and do happen. The word of a sales representative is not worth much. 

• In the case of software vendors, customizing products for specific customers is a mistake. Not every customer’s needs should be addressed by the product, but rather a market segment. One thing is to add features that will help your customer in their market segment; another is to customize it for them. Professional Services can perform custom work as long as it is outside the R&D organization. Don’t change the core product by using APIs or product-specific development tools. If professional services perform work for the customer, the customer should pay. 

The Win or Loss Analysis 

The win/loss analysis is crucial to the company’s continued success. A post-mortem is similar to this process. The patient’s treatment is independently assessed by a pathologist, an uninterested third party. Companies should involve the Product Managers in this process, if not manage it themselves, as this is the Marketing department’s responsibility. Win/loss analyses are designed to provide insight into what went wrong in the sales cycle and how to increase the odds of winning the next sale. 

Within your domain, you should look for ways to improve: 

• Prospects did not understand the message. 
• The functionality of the product is missing. 
• Sales may be hindered by a pricing model. 
• Ineffective sales tools. 
• Positioning and product changes of competitors. 

It is necessary to analyze all sales cycles. Especially if the loss occurred early in the cycle, sales reps are reluctant to report it. Find lost prospects at the beginning of the cycle and put extra effort into identifying them. 

What It Costs to Sell? 

Enterprise products are expensive to sell. There is a high cost associated with marketing programs that generate leads. Webcasts and mailings can cost as much as INR 1500 to INR 8000 per lead, while trade shows can cost as much as INR 10,000 per lead. In order to qualify leads, they must first be collected. It is important to consider how much time the representative spends talking with the prospect, traveling to meet them, and entertaining them. 

Conclusion 

In order to be effective, the Product Manager should understand the sales process, how sales reps play a role in the sales process, and how the Product Manager can influence it. 

So you may have a clear understanding of the roles and responsibilities of a Product Manager and the ten things that a Product Manager should know about sales. If not, then you need to check out UNext Jigsaw’s Product Management course.