This document is the result of primary research performed by Aberdeen Group. Aberdeen Group's methodologies provide for objective fact-based research and represent the best analysis available at the time of publication. Unless otherwise noted, the entire contents of this publication are copyrighted by Aberdeen Group, Inc. and may not be reproduced, distributed, archived, or transmitted in any form or by any means without prior written consent by Aberdeen Group, Inc.

July, 2012

Social Selling: Best-in-Class Targeting of the Right Message, at the Right Time, for the Right Person With the recent attention-grabbing IPO of Facebook, the attention of the business community is squarely focused on how valuable social media has become to the enterprise. With untold numbers of consumer hours now dedicated to posting, tweeting, liking and pinning, where is the measurable ROI for line-of-business executives seeking to monetize this brave new world? Moreover, has the momentum of social media marketing brought us to the point where professional salespeople can also benefit from its use?

Setting the Stage: Crossing the Marketing-to-Sales Chasm Social media marketing has been studied by Aberdeen for some time, and recognizing the power of user-generated content is quite common among business-to-business practitioners of marketing best practices. In B2B Social Marketing: Are We There Yet? (March 2012), the top 20% of performers among 520 surveyed companies represented a Best-in-Class group leading all others in customer retention, marketing contribution to the sales pipeline, and annual growth in revenue and marketing leads resulting in closed deals.

Figure 1: Most Effective Points in Sales Cycle to Leverage Social Media Content, by Best-in-Class

44%

8%

46%

36%

21%

27%27% 27%

18%

0%

10%

20%

30%

40%

50%

Building a list of salesprospects, companies orcontacts - working WITH

marketing

Building a list of salesprospects, companies or

contacts - workingINDEPENDENTLY from

marketing

Initiating contact with newprospects

Perc

enta

ge o

f Res

pond

ents

n = 520

Best-in-Class Industry Average Laggard

Source: Aberdeen Group, December 2011

Research Brief

Aberdeen’s Research Briefs provide a detailed exploration of a key finding from a primary research study, including key performance indicators, Best-in-Class insight, and vendor insight.

Social Selling: Best-in-Class Targeting of the Right Message, at the Right Time, for the Right Person Page 2

© 2012 Aberdeen Group. Telephone: 617 854 5200 www.aberdeen.com Fax: 617 723 7897

In Figure 1, we look at how “social selling” takes the hand-off from social media marketing, by understanding when in the sales cycle survey respondents believe user-generated content is most effective. The collaborative nature of strong marketing/sales alignment – explored in depth in Sales and Marketing Alignment: The New Power Couple (December 2011) – is well-defined as a Best-in-Class practice by Figure 1, showcasing how the top sales performers lead all other firms in using social media to build sales prospect lists by working side-by-side with marketing. Laggards lead the Best-in-Class by more than a 3-times factor, however (27% vs. 8%), in believing that social content should be used to create targets without the help of marketing. Taking the selling cycle from list-building to first contact, finally, we see the Best-in-Class more supportive of using social media to reach out to prospects, versus Industry Average and Laggard firms, which are more hesitant to do so. The lessons from Figure 1: during the crucial hand-off phase of the customer acquisition lifecycle, top-performing companies embrace social media to promote better targeting via marketing/sales collaboration and first-contact sales outreach.

With the social media marketing data in hand, Aberdeen is now pursuing sales-centric data with current research to be published in Social Selling: Unleashing the Power of Social Media on B2B Sales Enablement (Q3 2012). Among 173 companies having completed the market survey thus far, we are able to identify an initial Best-in-Class set of companies, as well as best practices that map to Aberdeen’s “PACE” research methodology (see sidebars on pages 2 and 3). This Research Brief highlights a number of capabilities adopted more frequently by these top performers, and are summarized in Figure 2.

Figure 2: Best-in-Class Social Selling Capabilities

75%70%

62%56% 56%

50%

35%

47%53%

31%27%

40%

28%

13%9%

0%

15%

30%

45%

60%

75%

Use prospect/customer data

to drive marketing/sales messaging

Engage customersthrough

personalizedsocial experience

Connect socialsales/marketing

activities throughmeasurable results

Identify mosteffective socialmedia channels

Social media"rapid response"to trigger events

Perc

enta

ge o

f Res

pond

ents

n = 173

Best-in-Class Industry Average Laggard

Source: Aberdeen Group, May 2012

Now, let’s examine each of these capabilities in detail.

The Social Selling Best-in-Class

In April and May 2012, Aberdeen surveyed 173 end-user sales organizations to understand how the top performers among them use social media. The performance metrics used to define the Best-in-Class (top 20%), Industry Average (middle 50%) and Laggard (bottom 30%) among these sales teams are: √ 79% of sales reps achieved

quota in the last calendar or fiscal year, compared with 43% and 15% among Industry Average and Laggard firms

√ 16.3% year-over-year increase in total company revenue, vs. 4.1% for Industry Average companies and an 8.7% decline among Laggards

√ 8.9% year-over-year increase in average deal size or contract value; Industry Average and Laggard companies reported 1.7% increase and a 6.6% decline, respectively

√ The average sales cycle was shorted by the Best-in-Class by 0.7%, and by Industry Average firms by 0.2%; Laggards report an average lengthening of the sales cycle of 5.3%

Social Selling: Best-in-Class Targeting of the Right Message, at the Right Time, for the Right Person Page 3

© 2012 Aberdeen Group. Telephone: 617 854 5200 www.aberdeen.com Fax: 617 723 7897

Social Selling Continues the Marketing Momentum Much as the previous research shows the value of social media in the marketing phase of the overall sales cycle, the baton-pass to the sales function includes the knowledge management capability of “using social customer and prospect information to drive marketing and selling messaging,” as shown in Figure 2 above. In Figure 3, the social selling research shows that companies adopting this approach report stronger current performing metrics than other firms; they also show stronger year-over-year growth in team quota attainment, lead conversion rate, Customer Relationship Management (CRM) adoption, and in shortening the sales cycle. Better business results are directly associated with organizations that collect social sales intelligence to better target the companies, contacts and newsworthy trigger events to hone the language with which they approach their prospective customers.

Figure 3: Better Knowledge Management Capability Pays Off

72%

58% 57%54%

59%

50% 52%

40%

25%

35%

45%

55%

65%

75%

Teamattainmentof quota

Salesforecastaccuracy

Customerrenewal

rate

Repsachieving

quota

Perc

dent

age

of a

ttain

men

t

n = 173

Users of customer data to drive messaging All others

Source: Aberdeen Group, May 2012

Consider, for instance, a marketing product manager who announces a new version of their solution via a tweet, offering a price discount to early-adopting customers. A seller of marketing automation platforms, price optimization software or other products used by this same marketing executive could predict that future marketing or advertising campaigns would follow, and gain early entry into that line-of-business decision-maker’s buying cycle. Indeed, when asked about their top goals for social selling, all companies surveyed lead with this same concept, and include other funnel-building desires in the top-four goals nominated:

• 58% discover new contacts to market or sell to

• 49% build and protect the reputation of the brand

Aberdeen’s PACE Methodology

Aberdeen applies a methodology to benchmark research that evaluates the business Pressures, Actions, Capabilities, and Enablers (PACE) that indicate corporate behavior in specific business processes:

√ Pressures — external forces that impact an organization’s market position, competitiveness, or business operations.

√ Actions — the strategic approaches that an organization takes in response to industry pressures.

√ Capabilities — the business process competencies (process, organization, performance and knowledge management) required to execute corporate strategy.

√ Enablers — the key functionality of technology solutions required to support the organization’s enabling business practices.

Social Selling: Best-in-Class Targeting of the Right Message, at the Right Time, for the Right Person Page 4

© 2012 Aberdeen Group. Telephone: 617 854 5200 www.aberdeen.com Fax: 617 723 7897

• 42% increase demand generation results, i.e. build more sales pipeline through social marketing / selling

• 42% increase prospect / customer awareness of the company, products or services

Leveraging the Personalized Message Having determined the ideal messaging with which to “socially sell” into better-targeted accounts, Best-in-Class companies are also stronger in their “ability to use information to engage customers through a personalized social selling experience.” Much as the late politician Tip O’Neill said that “all politics are local,” top-performing sales organizations know that the best results accrue from speaking to their prospects and customers about what matters to them, supporting the “WIIFM Rule” – “what’s in it for me?”

Table 1: Personalized Conversations Yield Stronger Sales Results

Sales Effectiveness

Metric

Companies Personalizing

the Social Selling

Experience

All Other Companies

Team attainment of annual sales quota 71% 61%

Sales forecast accuracy 57% 51%

Reps achieving annual sales quota 49% 42%

Average lead conversion rate 26% 23%

Average sales employee turnover (low = better performance) 6.6% 11.9%

Average deal size or contract value (dollars) $262k $149k

Sales cycle (months) 3.87 4.28

Lead conversion rate (year-over-year) 6.3% 0.3%

CRM adoption (YOY) 4.2% 1.5%

Average deal size (YOY) 4.0% 0.3%

Source: Aberdeen Group, May 2012

Using social media to better understand the day-to-day and real-time challenges of their target accounts, Best-in-Class sellers tailor their conversations to what is top-of-mind among their targets. A generation ago, sales professionals learned the value of asking about their buyer’s children if they saw a family photo on their desk; today they have the opportunity, via social media, to learn immensely more detail about the professional, as well as potentially personal, drivers that may motivate buying decisions among their target accounts and individuals (note: professional sellers need to understand

Sector Definition: Social Selling

For the purposes of this research, “social selling” refers to explore Best-in-Class adoption of: (1) internal collaborative social tools used by sales professionals to benefit team-based selling; (2) how sales teams “listen” to external social content pertaining to their customers, accounts and target markets; and (3) active use of posts, tweets or wikis by sales reps who contribute to the online conversations, in order to more effectively impact eventual buying decisions.

Social Selling: Best-in-Class Targeting of the Right Message, at the Right Time, for the Right Person Page 5

© 2012 Aberdeen Group. Telephone: 617 854 5200 www.aberdeen.com Fax: 617 723 7897

where to draw the line between connecting and stalking). Indeed, initial social selling research results indicate that Best-in-Class companies use Twitter and LinkedIn for business purposes at 100% and 95% rates respectively (compared with 78% and 92% among other firms), but also the more consumer-centric Facebook at a 71% level, specifically for business reasons; 60% of Industry Average and Laggard companies do so. Finally, in Table 1 we see that a series of current and annualized metrics are stronger among adopters of this knowledge management capability.

Staying on the Offense: Lessons from the Trenches Moving from knowledge management capabilities to concrete process best practices, the social selling Best-in-Class companies, as shown in Figure 2, are more than twice as likely as others (56% vs. 24%) to have in place the “formal ability to launch reactive social media campaigns/messaging based on trigger events or content requiring ‘rapid response.’” In this election year, we are reminded of the legendary “war room” mentality first introduced to presidential politics in the pre-internet days of the 1992 Bill Clinton campaign, which were fully realized in an online iteration during the 2008 election cycling pitting Barack Obama against John McCain. Today’s 24-hour news cycle requires – and enables – virtually anyone to track user-generated content in real-time, and to answer any challenge or sudden event with immediate effectiveness…if they are prepared to do so.

Figure 4: Annualized Benefits Accrue from “Rapid Response” Social Selling

9.5%8.5%

5.7%

3.8%

1.9%2.7%

1.4%

0.2%

-0.3%

-1.9%-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

Annualrevenue

CRMadoption

Leadconversion

rate

Teamattainment

of quotaReps

achievingquota

Year

-ove

r-ye

ar c

hang

e

n = 173

Rapid social responders All others

Source: Aberdeen Group, May 2012

Bringing the metaphor back into the enterprise, more than half of Best-in-Class, social-equipped sales organizations (56%) are pre-positioned to leverage trigger business events to their advantage, while fewer than one-third (31%) of

Social Selling: Technology Best Practices

The technology enablers associated with Best-in-Class social selling performance include:

√ 100% Remote or mobile sales team members have full access to social media tools, vs. 60% among Industry Average companies and 0% of Laggards

√ 80% Social bookmarketing tool (record favorite user-curated content in browser); vs. 57% and 33% among Industry Average and Laggard companies

√ 57% Social business platforms (combines contacts, calendars, communications, social stream); 57% and 20% respectively of Average and Laggard companies do the same

√ 56% Social media sharing tools (e.g., allow site visitors to share content with social networks), compared with 50% and 17% respectively among the Industry Average and Laggard groups

Social Selling: Best-in-Class Targeting of the Right Message, at the Right Time, for the Right Person Page 6

© 2012 Aberdeen Group. Telephone: 617 854 5200 www.aberdeen.com Fax: 617 723 7897

the Industry Average and 9% of Laggards are able to replicate this process capability. In practical business terms, this translates into sales teams tapping into the social media stream so that important events – mergers/acquisitions, C-level personnel changes, legislation that impacts products or services – can be digested and responded to with organized, prepared and effective sales activities. For example, a user-generated LinkedIn update about a senior line-of-business leader changing roles, can be leveraged by an attentive account manager in the middle of selling to the executive’s former firm – the sales approach will need to be quickly re-crafted – as well as gaining the upper-hand by being “first in the door” in the contact’s new role. Figure 4 showcases the annualized performance metrics and advantages associated with adopters of this best practice; these companies also lead others in current performance metrics such as team attainment of sales quota (82% vs. 60%), sales forecast accuracy (62% vs. 50%), and percentage of reps achieving quota (57% vs. 41%).

Measuring What You Manage Once the process and knowledge management capabilities above have been implemented, Best-in-Class firms are more aggressive in measuring and managing the performance of social selling initiatives. This is pursued in order to track their Return on Investment (ROI), as well as in closing the loop with their marketing counterparts to ensure long-term success.

Figure 5: Long-Term Performance Benefits of Identifying Most Successful Social Selling Channels

-1.7%

-0.5%

0.5%

0.5%

3.2%

1.0%

2.0%

3.0%

3.6%

5.9%

-2.0% 0.0% 2.0% 4.0% 6.0%

Reduction in sales cycle

Customer renewal rate

Lead conversion rate

Average deal size

Annual revenue

YOY change, n = 173

Socialchannel ROIanalyzersAll others

Source: Aberdeen Group, May 2012

Companies that report the “ability to identify the most effective social media outlets, platforms or channels” out-perform others on a year-over-year basis (Figure 5), as well as reporting stronger current team attainment of quota

Social Selling: Best-in-Class Targeting of the Right Message, at the Right Time, for the Right Person Page 7

© 2012 Aberdeen Group. Telephone: 617 854 5200 www.aberdeen.com Fax: 617 723 7897

(72% vs. 60%) and lower sales turnover (7.6% vs. 11.8%). The latter metric is worth noting, considering that in Sales Performance Management 2012: How the Best-in-Class Optimize the Front Line to Grow the Bottom Line (September 2011), Aberdeen research found that the typical Business-to-Business (B2B) field sales rep cost $35,670 to replace. Keeping sales professionals engaged, by providing them with not only the most contemporary social media tools, but also with proof that they are effective, is surely a welcome sales enablement best practice. The marketing team, working in conjunction with sales leadership, has been showcased in Sales and Marketing Alignment: The New Power Couple (December 2011) as also benefiting from measuring the impact of their investments and campaigns on sales-centric metrics such as how much they contribute to the sales pipeline; the same logic applies to which specific social media channels – blogs, posts, shares, likes, tweets across a large landscape of user-generated content platforms – await the brass ring of achieving positive enterprise ROI.

These best practices, finally, support the strong Best-in-Class adoption rate of the “ability to connect our social media activities with measurable marketing results (web traffic, campaign responses, etc.).” Adopters of this approach report a wide number of current and year-over-year performance metrics that are more successful than non-users, such as a 23% higher lead conversion rate (27% vs. 22%), a 5.6% increase in annual revenue versus 2.7%, and 24% more sales reps achieving quota (51% vs. 41%). These statistics drive home the value of not only using social media to support marketing and selling, but to continuously improve their effective use by monitoring and adjusting where and how user-generated content is leveraged in the context of better sales intelligence.

Conclusion While social media represents a relatively new tool for professional sellers to add to their belt, the current data strongly suggests a series of proven use-cases for empowering them with all the sector has to offer. Companies seeking to provide their front-line reps and account managers with better, more actionable real-time data that promote more customer-facing selling time, more opportunity to join the “A player” tier of success, and more top-line revenue growth, are following the Best-in-Class trends discussed here. For more information on this or other research topics, please visit www.aberdeen.com.

Social Selling: Best-in-Class Targeting of the Right Message, at the Right Time, for the Right Person Page 8

© 2012 Aberdeen Group. Telephone: 617 854 5200 www.aberdeen.com Fax: 617 723 7897

Related Research Sales Mobility: How Best-in-Class Remote Sellers Are Replacing “See” with “Do” (May 2012) Lead-To-Win 2012: Managing People, Process and Technology to Optimize the Last Mile of the Sales Cycle (March 2011) Partner Relationship Management: Channeling Better Sales Results (March 2011) Sales Performance Management 2012: How the Best-in-Class Optimize the Front Line to Grow the Bottom Line (December 2011)

Sales Training 2011: Uncovering How the Best-in-Class Sustain, Reinforce and Leverage Best Selling Practices (October 2011). Leveraging the 360 Degree Customer View to Maximize Up-Sell and Cross-Sell Potential (September 2011) "Chance Favors the Prepared Mind" - Understanding the Science of Sales Intelligence (July 2011) Sales Forecasting: How Top Performers Leverage the Past, Visualize the Present, and Improve Their Future Revenue (July 2011) Streamlining the Top of the Funnel: How Inside Sales Teams Source, Qualify and Close Business (February 2011)

Author: Peter Ostrow, Vice President and Research Group Director; Customer Management, Sales Effectiveness (peter.ostrow@aberdeen.com) LinkedIn Twitter

For more than two decades, Aberdeen's research has been helping corporations worldwide become Best-in-Class. Having benchmarked the performance of more than 644,000 companies, Aberdeen is uniquely positioned to provide organizations with the facts that matter — the facts that enable companies to get ahead and drive results. That's why our research is relied on by more than 2.5 million readers in over 40 countries, 90% of the Fortune 1,000, and 93% of the Technology 500. As a Harte-Hanks Company, Aberdeen’s research provides insight and analysis to the Harte-Hanks community of local, regional, national and international marketing executives. Combined, we help our customers leverage the power of insight to deliver innovative multichannel marketing programs that drive business-changing results. For additional information, visit Aberdeen http://www.aberdeen.com or call (617) 854-5200, or to learn more about Harte-Hanks, call (800) 456-9748 or go to http://www.harte-hanks.com. This document is the result of primary research performed by Aberdeen Group. Aberdeen Group's methodologies provide for objective fact-based research and represent the best analysis available at the time of publication. Unless otherwise noted, the entire contents of this publication are copyrighted by Aberdeen Group, Inc. and may not be reproduced, distributed, archived, or transmitted in any form or by any means without prior written consent by Aberdeen Group, Inc. (2011a)