SalesTech Interview with David Hood, President & CEO at VanillaSoft

Tell us about your journey in the Sales Technology industry. What attracted you to be a part of VanillaSoft?

Following a brief stint in politics at the beginning of my career, I started in high-tech sales, first handling France and Great Britain and then India and Australia for Corel Corporation. I loved helping people understand their pain points and needs, and then coming up with solutions for them.

In the mid-90s I remember getting permission to cut a barter deal with Maximizer (CRM) to trade products, as I loved the idea of their relational database allowing many-to-one contacts as compared to Act which was widely used at the time.

I left Corel to start a company in the digital images space, but always stayed close to the sales aspect of the business and was fascinated by the evolution of sales technology. After we sold the company I was introduced to VanillaSoft by a colleague from HBS. The founder of VanillaSoft also happened to be an HBS colleague, and I loved his vision for how to combine the productivity of outbound call center technology with the information supplied by CRM systems in order to drive quality outbound calling for inside sales processes.

This was in 2005, long before the emergence of sales engagement as an industry term, so we spent many years educating prospects on why their traditional CRM platforms were not the right tool to drive engagement.

During these years the sales industry underwent many fundamental changes. Part of the buying cycle started shifting away from the seller, as more and more buyers carried out research online before contacting a salesperson. Marketing automation platforms emerged, leading to more structured lead nurturing before a prospect hit the sales funnel. The number of marketing qualified leads (MQLs) increased, as did the knowledge level of the buyer by the time they were connecting with salespeople. All of these leads were still being dumped into a traditional CRM system that was designed for managing relationships and giving a holistic view, not for driving activity. This inevitably led to the results that came out in study after study: leads were not being followed up on quickly, or at all.

Many MQLs simply languished, leading to tension between the sales and marketing departments and lost revenue for companies. The emergence of sales engagement as a recognized sector is a recognition of these problems. Sales engagement platforms are designed for starting relationships by driving speed-to-lead, productivity and persistence.

VanillaSoft recognized this need well before the market did, and we have spent those years developing an incredible platform used by thousands of people to manage and drive their activity.

If not an Inside Sales company, where else in the business would you have made your career?

The most important thing for me has always been delivering products or services that solve real problems and create real value. My satisfaction comes from knowing that we are having a positive impact on our clients’ bottom line, which helps all employees and their families.

On the other hand, I did my first degree in biochemistry and philosophy and originally thought that I would end up in bioethics law. It is funny how life can take many turns.

How different is the Cloud-based industry for the Marketing and Sales technology products compared to other technologies, for instance, IT SaaS?

The great thing about selling sales and marketing technology into the small- and medium-sized business market is that you often get to deal directly with the people who will be getting the benefits, i.e. the sales managers and salespeople. It is very rewarding to be able to get a deep understanding of the end-users requirements and even have an opportunity to advise as to possible ways to optimize workflows.

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Tell us how you consume and promote content for Inside Sales practices. What is your advice to all the sales leaders in the community?

We are avid followers of blogs, podcasts, and Webinars in the sales area. There is a tremendous amount of relevant material being produced, and it is important to stay abreast. Everyone doesn’t always agree, but I think that also reflects that fact that sales organizations are incredibly diverse, as are consumers. At VanillaSoft we like to take a data-driven approach to as much content as possible. In fact, you could probably even characterize our approach as an academic.

We have been working with the Telfer School of Management at the University of Ottawa for many years promoting the understanding of inside sales. We were not satisfied with industry research which is often internally created and therefore somewhat suspect, so we turned to a renowned academic institution to ensure the integrity of the studies. We have co-published several academic articles with them and are looking forward to many more to come.

We believe that Inside Sales, and Sales Engagement generally, is still underserved by academic research.

How do you differentiate—Customer Success vs. Customer Experience? How have these definitions changed in the past 5 years with Inside Sales technologies?

I think that in some ways it is a semantic differentiation. Customer Success could be defined narrowly as how effective the actual technology is – did it deliver on the advantages that it promised. Customer Experience could be defined as the feelings of the customer regarding their interaction with the supplier or the product and service.  I believe that you cannot deliver one without the other.

Which sales technology tools/ technologies would you identify as the most-disruptive in the on-going research?

This may sound a bit old-fashioned, but I think tools some of the most disruptive sales technologies of the next few years will be those that actually help push activity and productivity. I believe that over the last decade or so technology has concentrated on its power as a database of record, giving a holistic view of the prospect or customer and their interactions with the company. There has been very little focus on how you can drive sales activity, i.e. increase the engagement points carried out by salespeople.

That is why I believe that sales engagement is so hyped at the moment.

I also believe that sales enablement will come into its own over the next three years, as solutions for predicting and recommending the proper content at the right time become both more sophisticated yet at the same time easier to implement. So the most disruptive technologies will be those that are able to harness the power of data but then use it in a system that drives action.

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How do you enable your customers to benefit from your Sales Technology and solutions?

There is no mystery to making customers successful. You have to start with a product that meets their needs, ensure that they get started off right, and then offer world-class support on an ongoing basis.

For us, that spreads across three different sales team. We start by ensuring that our salespeople get a good understanding of the customer’s pain points and can clearly identify how their product will address them. They then work in conjunction with our Customer Success team to help the customer configure the system in an optimal fashion, benefiting from the many different features and functionalities available.

Once the customer is up and running, we back it up with exceptional Sales Support to address any issues or questions that come up.

For us is it important to reduce to a minimum the number of support issues that need to be escalated by ensuring the quality and knowledge of each Support employee. Being passed from one person to another to solve an issue is not good customer experience.

Finally, we do regular account reviews to check that all is going well and that needs haven’t changed.

What are the core strategies you focus at VanillaSoft for Global business development? How does it impact your Customer experience initiatives?

The global business development strategy is not fundamentally different from our North American strategy. We try to partner with local sales experts to deliver useful sales information and tips to salespeople. We believe in in-market sales personnel to be able to offer a personal touch.

What is the current state of “World-Class Sales practices”? Could you elaborate with some examples?

I have always found it interesting that almost every university offers a marketing degree, but a sales degree is almost unheard of. I am very encouraged that scientific and academic principles and analysis are not being applied to sales as well. VanillaSoft, for example, has partnered with the Telfer School of Management to test sales models using actual sales data.

Companies need to make decisions and take actions that are informed by rigorous analysis and not just my gut feelings.

In the sales engagement space, we see many examples of that now. Many studies have been carried out to determine how quickly a company should reach out to a prospect that has filled in a form. The importance of persistence in Sales has been highlighted, and studies are being carried out to see what the optimal contact strategy is.

Voice analysis is being used to not only help manage people but also to optimize how salespeople should interact with prospects.

This raises another exciting new development, the increasing importance of the sales technology stack. Marketing is well ahead of sales in this area. It is very normal for markets to be using half a dozen or more tools in their technology stack in order to optimize individual efforts and strategies. Sales departments, on the other hand, have operated for decades with only one tool: CRM. This is now changing.

We are seeing multiple new categories appear that allow the sales manager to put the appropriate tool in the right hands at the right moment: sales engagement, sales enablement, voice analysis, data enhancement tools, etc. This is very exciting and will lead to an ability to optimize the sales process at every stage.

Imagine that MQLs hit the sales funnel, data is appended, the lead is automatically prioritized and put in front of the salesperson at the right time for contact, the appropriate content to use for the touch point is recommended, voice analysis leads to suggestions on how to approach or improve the conversation, and then when the lead is qualified to an SQL it moves into the CRM for the close and relationship management.

Today that lead often just falls into a list in the CRM and the manager hopes that someone reaches out, although studies show that 50% of them will just sit on that list forever with no contact attempt.

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What is the sales culture that you represent? Why is it important to build a sales-focused culture for any business?

The sales culture in an organization comes from the bottom-up and goes from the top-down. It is reflected in how everyone talks about the role of sales. I think that in many companies today there is a still an old-fashioned sales culture at play, the ‘winning is everything’ or ‘coffee is for closers’ way of thinking that pushes salespeople to do anything they need to do in order to hit their quota and makes everyone else in the company happy that they are not a salesperson.

I believe that the fundamental job of sales is to help prospects understand whether you can add value to their processes and have a positive effect on their lives. It is to help them arrive at the best possible decision for themselves and their company, which sometimes means helping them get out of their own way. It is part education, part therapist and part negotiation.

This view of sales is inclusive and allows all branches of the company to feel like they are part of the sales process. The focus on end-user value drives everything within the company and makes everyone a salesperson. This is the sales culture that we aim for.

How do you achieve this culture-balance at VanillaSoft? What percentage of this is driven by the application of technology, reporting tools, and coaching?

We work every day at achieving a correct balance and learn from every moment that we don’t. It is through constant communication, both punctual and ongoing. It is through company-wide achievement recognition, but also just through the many comments throughout the day that help people validate what they are doing.

Technology does play a part in this, as it allows us to better disseminate information and measure ourselves against what we are trying to achieve. But fundamentally the stated culture must reflect the true fundamental beliefs of management and the employees, and become self-reinforcing.

How do you leverage AI and automation at VanillaSoft? What recommendations you have for other research analysts in the industry?

We are leveraging AI both as a consumer and as a vendor. Internally there are AI components to several of our marketing efforts, helping us to optimize the use of email and content. As a vendor, we are just wrapping up an exciting AI project designed to help companies instantly apply inbound lead prioritization within VanillaSoft.

We will continue to apply machine learning to allow our customers to get the most from the data available.

Would self-service technologies continue to disrupt Customer Experience platforms? How do you prepare for this disruption?

Self-service will continue to be an important tool of customer service, but I do not believe that it will replace personal interaction. First, not everyone prefers the self-service model. Many would still rather have the opportunity to engage with a real person to discuss their issues.

Second, self-service works very well on fairly simple, common issues but can falter when the issue becomes more complex. Even with the advent of improved AI, there are situations where the human touch is very important. It is therefore important to try and offer both experiences.

What are your predictions and observations on the “Role of Chatbots and AI Conversations” influencing CX*- driven Sales journeys?

I predict that Chabtots and AI conversations will play a growing role in inbound interactions, but that we are still early in the hype curve and there will be many people become disenchanted with the technology before we really understand how to implement it and it hits the mainstream.

Chatbots can enhance humans but not completely replace them. When improperly implemented, which seems to often be the case, you start your conversation with an AI piece and are then left hanging when you go past the capabilities of the Chatbot yet human resources are not there for the deeper conversation. This leaves people feeling even more frustrated than if there had been no chat function in the first place. Poor implementations will slow down the acceptance of this technology, but

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How do you prepare for an AI-centric world as a Sales Research leader?

At this stage, I think that it is extremely important to stay abreast of AI developments. We attend several major conferences and follow blogs and podcasts. While being a promotor of AI, however, it is important to also be a skeptic at the same time.

We must understand the current and future limitations of AI, and how they may impact organizations differently. It is extremely important for organizations to not just buy into the hype, but to also understand the potential pitfalls as it relates to their own particular situation. This is especially important for the SMB market, which is our main focus, as the data sets can lead to more unreliable results.

Which events and webinars do you most occasionally attend and why?

There are several events that I like to attend regularly, including the AA-ISP Leadership Summit in Chicago and the Sales Expo in London. RE-WORK organizes some great AI conferences. Although they are not sales specific, they allow you to get past the spin and really understand what advances are happing in the AI world.

Your advice to Sales Performance and Enablement executives –

I think that sales executives need to optimize their use of technology, but not by necessarily buying what they know but instead by analyzing their actual business needs and sales processes and then evaluating the tools that are available. What is the key to driving success for that particular group? There is so much in the market now that the sales and marketing tech stack can be highly personalized.

The growth of the sales engagement market is just an example, whereby sales engagement platforms are replacing CRM for those salespeople that need to drive engagement through activity. You need to put the right tools in the hands of the right people.

Thank You, David, for answering all our questions. We hope to see you again, soon.