IndustrialSage

All right, so for today’s IndustrialSage Executive Series Interview, I am joined by Patrick Moorhead, who is the Chief Marketing Officer of Pricefx. Patrick, thank you so much for joining me today remotely from Chicago.

Great to be here, thanks for having me, Danny.

Well I’m excited to have you on here, and learn about you, and your organization. So for those who aren’t familiar, we’ll start off with this, with Pricefx. Who are you guys, what do you do?

We are a early stage SAAS software company, and we provide a very unique capability for B2B price optimization and management.

Okay.

The easy way to understand what that is if you’re not close to that, is enterprise companies, normally companies that do more than 100 million in revenue annually, in selling products to other businesses, are often managing complex portfolios of products, thousands of skus, multiple different price points, across a distributed organization with multiple stakeholders, including sales, and needing to determine pricing, in the form of contracts, to their customers in a way that is reflective of the customer relationship, of the historical customer relationship, and also their needs to maintain growth, and margin, and profitability, and account for all the costs of making those products, but also creating growth and profitability.

So we provide a platform that comes with a suite of products that are focused on how to enable dynamic pricing, price optimization, so looking into the discrete item level pricing all the way up to deals, et cetera, across a portfolio, to find out opportunities for growth, to enable promotions in a way that don’t cost margin and profitability. The tool also provides for really flexible price management, which is a capability that’s increasingly important these days, particularly with companies who are selling more and more in digital spaces. And then also a realization suite. So how does all of that insights intelligence, and how does all of that price management capability, get deployed into a sales force, in a way that enables sellers to do what they want to do with customers, but not violate the guidance, and take advantage of the insights generated from the way that pricing is set in the organization.

Well it’s certainly a challenge for sure. I can see especially with a large shift to ecommerce, and all kinds of things as well, are you guys exclusive to sort of the industrial markets and manufacturing, or are you in other verticals?

No, we are a horizontal solution, which is unique for pricing software. Our platform is task based, and one of the differentiators about Pricefx is that we have really taken the risk and friction out of using pricing software. So we are a subscription based service, it’s completely customizable to the needs of the organization, it’s a no fuss contract, it’s a cancel at any time type of deal, typical for software as a service. And because of that sort of horizontal nature, we’re able to be useful to almost any enterprise, B2B type of customer, that would look to do better in pricing. Today we have more than 100 customers, and those are distributed across more than 14 different verticals, including industrial manufacturing, discrete manufacturing, process and chemical engineering, aftermarket distribution in auto parts, tear industry parts, packaging is a big sector for us, and ecommerce and B2C businesses as well, including online ticketing, ski lift ticketing, we have a customer that’s big there, and even some big ecommerce software customers.

Okay, interesting, very cool. So I’m sure we’re going to dive into that here a little bit more, as we get later into the episode, but for right now, how did you… Tell me: how did you get into this space? What did you… take me back: what did you want to do as a kid? And how did you end up here?

Yeah, that’s a great story, my path has been really a winding one. I was an artist, and a musician as a kid, I went to college and got a degree in fine arts, and painting, and drawing. And when I came out of school in the mid 90s the internet was happening, and I was poor, and so I taught myself how to write web code, html, and javascript, and flash. And was easily able to pick up sort of freelance work, developing websites for customers, and wound up doing really well there, in fact making more money than I was ever going to make as an artist. And that led me down the path of getting involved in the advertising industry, which is where I made kind of the first half of my career. Starting out working in small regional ad agencies on the east coast, and then getting a job at a larger digital ad agency, which kind of took me into the big corporate industrial advertising and marketing ecosystem.

I spent more than a decade in that world, with global ad agencies, and increasingly in global executive roles. And along that path obviously, the growth curve on internet technology, and really mobile technology changed dramatically, from like 2000 to 2010. Inside the ad agency a lot of my job was about looking at technology evolution and understanding how to road map that into solutions for the agency’s clients. And so I got exposed to a lot of innovation, I got to see Twitter in its early days, I saw the sort of rise of Facebook, when you could only use it with a school address, right, with an edu address.

Yeah.

And I saw a lot of those stories, and over that time I became aware that really where I thought the action was was on the product and technology side of the business. And so I made the choice to leave the ad industry, and shift gears in my career to get into the technology, and really the data market world of technology. I took a step back in my career, both in title, and pay, in order to make that career change. And then took a job as a sales account executive at a data company, and started to refashion the way that I was working more along the lines of sales and marketing, from the inside out, from a technology company provider. And I’ve been there ever since, I got the good fortune to participate in an exit in that first company. I changed, from that point I spent a couple of years working inside Twitter, which was really exciting. It was right after the Twitter IPO, and really watching from the inside how Twitter built out a multi-billion dollar sales organization.

And then through a mentor I got a break, a mentor relationship I had intentionally cultivated for most of my advertising career, with a gentleman who is a professional investor, and a board advisor, who had come to take over the active CEO role of one of the companies that he invested in. And he called me and asked me if I would be interested in sort of being his right hand, and joining him as the chief marketing officer of this small, 35 person software company. And I took the leap, I left Twitter, I joined that company, and together we were able to raise more than 35 million dollars in venture capital for that firm, double its revenue, and double its headcount, in about two years.

And it was at that point that I encountered the guys at Pricefx, and I saw Pricefx as sort of being in a moment where they were, they had conquered a lot of the difficult challenges of starting and getting a software company off the ground, and were ready then to sort of take advantage of some of the experience that I had built over my career, and the experience that I had built in that start up software environment. I met them, it was a matter of weeks, the fit was really nice. I didn’t know anything about pricing, and I’m a year into the job, and I’m a year into the world of pricing, but I’m excited about the job because I see a tremendous potential for a group of experts in their subject domain of pricing and software to take advantage of what I’m able to bring, which is really the benefit of having worn a bunch of different hats in sales, and marketing, and advertising, over the course of my 15+ years, all to bear every day in this job.

So in this role I’m tapping into public relations, event marketing, digital advertising, brand storytelling, sales enablement, industry relation, sort of all matter in this role, in a really tangible way. And I would really only be able to bring all of that into focus for Pricefx if I hadn’t spent time in my journey in each one of those disciplines along the way. So in that way, it’s a really dream job for me, it’s a great fit for me, because I get to use all of my experience, and they get to take advantage of all of that.

Yeah, no, that’s awesome. So you’ve mentioned actually a lot of different areas between event, storytelling, and all these, just, I’m curious, what aspect is your favorite?

Yeah, that’s a good question. My favorite genre of marketing is really brand marketing, and storytelling. There’s nothing more interesting to me than the craftsmanship of a brand’s story, that sort of looks too harness what’s great about the company culture, link that to what’s great about the products that are produced by that culture, and ultimately then linking that to the value that customers can derive by becoming customers of that company. I think that’s… if you think back all the way in my career, to sort of starting out in fine arts, that is truly art in practice. The ability to identify what’s important in each of those different containers. And then link them together, and put a varnish on that that is accessible, that’s exciting, that’s emotionally linked, that to me is really a way that artistic creativity gets materialized in the world of business. And so that’s what gets me excited. The other thing that’s become real exciting to me in this job, and over the last few years, is the level at which marketing is becoming accountable, and driven by data, and so the idea that you can have this sort of very artistic creative approach to telling a story, but that you also then can deploy that story and measure it, not just on revenue, but measure it in terms of engagement, in terms of pipeline, and funnel growth, and really understand is my story connecting with the audiences that it’s designed to connect with, that’s a super cool thing that is, I think, only available to the modern marketing world.

Oh yeah, actually those two areas you mentioned are my favorites, it’s really blending those worlds and I think it’s super exciting to be able to do that because you can legitimately build out a real business case for that though now, whereas before it was a little bit more like hypotheses, like “Well it’s just creating this feeling, it’s good,” and, “Well show me the… where is the black and white impact on the bottom line, or even the top line revenue? Show me that.” “Well, it’s really hard.” Well now, because of all this great new technology we can do that, you can look at engagement, you can see it, how, it’s not all rainbows and kisses, right, because there’s still some challenges in there for sure, but by and large, you can still measure that kind of engagement, and actually draw a line, if it’s set up correctly, to see the direct impact to revenue, and what you see, sorry, you’ve hit a core, I get excited about this.

I know.

What you see is that, oh wow, people, the more creative, the more heart, the more purpose there is in that content, the more you have a really true storytelling brand around it, the better it’s going to perform. The better it performs, means that it has a more positive impact on the bottom line, maybe we’ve made the connection. Thank you Mr. CFO.

Yeah.

Okay, all right, we’re going to go ahead and approve that, right?

Yeah. And I think that’s exactly right, and there’s something about the idea that if you’re able to create a brand story that connects emotionally with customers, and that story is driven off of, sort of authenticity.

Yes.

Of the company, and the people that work at the company, and then you can find a way to connect that in a commercially meaningful way, that results in pipeline, and funnel, and revenue. There’s nothing to me that’s better than that, right. To be able to take truth, make it beautiful, and make it relevant for an audience, so that it’s not I’m getting you to buy this story, but I’m selling you something else, that actually there’s a seamlessness to it.

So the addition of all of the technology really, I was fortunate enough to meet and know a guy named Rishad Tobaccowala, who is a chairman of Publicis Groupe now, but he started in an ad agency world years and years ago. And his analogy really stuck with me to understand the sort of data driven marketing world that we live in, which is all of the technology that we have deployed around data, and analytics, and ad targeting, and all of this stuff, is really plumbing, right? And plumbing is plumbing. It’s only as useful as the water that you put through it. And artful brand storytelling is the water. And so you can build amazing, elaborate plumbing systems, but if they leak, or if they only deliver dirty water, then the plumbing is malfunctioning, right. It’s pointless. And so I like that analogy, of the idea that hey, don’t forget, plumbing is important, plumbing gets stories to the right places, in multi-channel, and all this data, right. But if fundamentally you’re putting dirty water into a complex plumbing system, you will get dirty water out the other end.

Yeah.

And storytelling, in today’s data driven world, is the water of marketing plumbing.

That’s a great analogy, I love it. I couldn’t agree more, no you’re 100% right. I mean you so easily get lost in the measuring, and the work flows, and the integrations, and the automations, like all that stuff. And I admittedly get excited about that stuff, that stuff is cool, but you can get lost in that so easily. You’ve got to go back to the core, to your point.

Yeah.

So we could probably talk another three hours on this, but I want to kind of move on to some of the other areas right now. Let’s talk about… obviously we’ve got this whole, like COVID issue, this whole challenge of Coronavirus, and it’s creating just a whole host of challenges, and opportunities, quite honestly, for a lot of organizations. What are some of the challenges that you guys are seeing in the industry relative to pricing that have been affected because of the Coronavirus? And what are some problems that were still… that were there, not affected, those problems, those still exist.

Yeah. There’s quite a few, and it’s been really interesting and sort of the discrete pricing optimization and management universe, to see how some of the challenges have existed, and now are more acute, but also opportunities. I think in general my take is that the global crisis has polarized things industrially. There have been clear winners and losers, and there’s not a lot of middle ground. So from a pricing point of view, organizations look at pricing, and it’s very pragmatic exercise, where you want to be able to primarily manage pricing around the products that you sell in a way that is scalable, and maintain some level of sanity as you’re doing that, right. So we don’t want to give away our margins, but we do want to offer promotions, we want to aim for a certain level of profitability. How are we going to get that? And so as the crisis has unfolded, you’ve sort of seen companies who fall on the side of, oh man, they’re really going to get crushed, because, for example auto manufacturing is at a standstill. So all the downstream industries around auto manufacturing, parts manufacturing, distribution, suffer. At the same time you see other industries that are having the opposite problem, where they have so much demand that they’re actually not built out to deal with it, right.

Yeah.

So anybody that’s adjacent to sort of medical supplies, medical device componentry, anything in that area, anything that would be in demand as a result of the crisis, now you have overclock on those systems, and then you have on the other side sort of latency, right. So you have this severe sort of delta. I think the interesting thing that we’ve seen is that many companies have responded to the crisis by saying the same thing, which is “Wow, it’s showing us we probably shouldn’t have waited to do better with how we do pricing management, and pricing optimization.” Either because now it really matters, and we want to go re-look at our pricing, and re-deploy our pricing, in a rapid, short amount of time, in order to try and survive.

Yeah.

And we’re finding out that we deployed a price management and optimization system that doesn’t work as fast as we need it to work. So we get those calls, because our solution is highly flexible, we can deploy a standard set of price optimization management capabilities to an organization in under six weeks, and sometimes as little as a couple of weeks. Many of our competitors don’t have that ability, they have six month, nine month, twelve month implementation and customization cycles. So we’re seeing an uptick in those things of saying “Wow, we really need to do better, we need to do it fast, we shouldn’t have waited, but we did, now we’re sort of ready.”

On the other side, we see folks saying, “Well since we are sort of slow,” or, “Since we do have a sort of lull or a slow down, maybe now’s the time to look at implementing some more robust changes in the way we approach pricing optimization and management. Provided we can do that relatively quickly.” Now the crisis kind of provides an opportunity to step back and look at things in a radically different way and say, “Well hey, if we’re sort of shut down at the moment, maybe it does make sense to take this time to look at throwing out what we had and implementing something new that is going to serve us better on the other side.”

Yeah, absolutely, and I think a lot of companies right now, that is a big challenge, and it reminds me obviously of 2008, when you got into the recession, and there’s this question, it’s funny actually, that we were talking about brand a little bit before this, a little coincidentally maybe, but there is a big impact between pricing and brand. I mean there is a little bit of a relationship there. Have you seen companies… I guess where I’m going with this is that, depending on the luxury product that you have, we’re talking B2B, so let’s say B2B industrial, you’ve got the top of the line whatever, tank, that you’re manufacturing, and your brand is synonymous with top quality, and everything, in terms of like lowering that price during moments of disruption, or challenges right now, how does that… that can negatively impact your brand, but then maybe there’s also areas of like “Well, gosh, in order from a survivability standpoint, we have to do this, and we have to give up margin, because we, from a top line revenue perspective, there might… if we don’t have any dollars coming in, there is no margin to reduce, or keep up.” So have you been seeing a lot of that going on right now?

I think that, well certainly all that pressure exists, and is amplified because of the crisis, right. But I would argue that’s not new, it’s just amplified, right.

Yeah.

Some of our anecdotal data is that more than 70% of companies over 100 million in revenue that could make use of a platform price optimization and management tool, don’t. In fact operate their pricing management and guidance from offline solutions like Excel. That’s kind of an astonishing number, if you take into account what’s in there. That’s all the way from companies that are barely doing 100 million in revenue, all the way to companies that are doing multiple billions in revenue.

Yeah.

And so if you think about almost 3/4 of enterprise customers managing pricing for their enterprise with, kind of a horizontal tool, but an offline tool that’s not built to do that at scale, a spreadsheet tool. That by default means that that problem you’re indicating about, “Oh how do we cut prices and not lose the company? How do we… is it possible for us to operate on a lower margin, or what kinds of sacrifices would we need to make in profitability, in order to not, you know, lose the whole game, through the course of the crisis?” Reveals that that tool can’t do that, and actually that tool was never designed to do that, and you’ve been limping along with that tool for quite a while, and got away with it because you didn’t have the pressure that you have as a result of the crisis.

Yeah, so I mean, pull out your crystal ball, here for a minute. What do you see companies, what are some of those adjustments, or those changes, for better or worse, that you see, maybe in the short term. So, let’s say we climb out of this thing, and I guess by climbing out is super subjective, I don’t know. But short term, two to three months from now, versus six to twelve?

Well, I don’t know, I saw a funny comic on Twitter the other day. There’s been a couple that have circulated around. The first comic that I saw was, it was actually I guess you call it a meme, but it was a fake survey question, and it said “Who was the catalyst for your digital transformation initiative? A: the CTO, B: the CMO, or C: COVID-19?” And it was COVID-19 circled.

That’s awesome.

And I think that’s right, right. There was another comic that sort of was a cutaway view, where it had a bunch of people in an office, and they were obviously like the executive leader of the meeting was saying “No, we don’t need to do a digital transformation, we’re fine with things as they are.” And then you can see outside the window, there’s a giant wrecking ball that says COVID-19, sort of swinging towards the board room.

You know, I think those are true. I think that what’s the positive upshot is it’s going to show companies that being digitally nimble, that adopting newer generation technology solutions for mission critical functions in the business is not optional just because it has a marketing speak title of digital transformation. And I think you’ll see some near term winners and losers right, around that. There will be companies that either took advantage of the crisis to rapidly enable themselves around things like pricing, with new tooling that enables them to be on a much faster footing, or you’ll see companies that already had made those decisions prior to this, that manage to make it through easier, or that even potentially grew through it, and you’ll also see companies that A didn’t make those choices early enough, and B didn’t move when they had to, and got walloped, right. But in general, I think that the crisis is going to have a big impact societally, and certainly in enterprise, of further accelerating digital transformation for companies.

Yeah.

It’s going to emphasize, right, and you can see that just from the fact of how we’re doing this interview.

Yeah.

And the amount of people who are on Zoom calls right now, while you and I are on a Zoom call, right. That is a digital transformation that has quickly taken root across the world. It’s just one example, though, of I think how the crisis likely will force digital transformation onto businesses that maybe were on the sidelines.

Yeah.

Because they felt like it was okay the way it was, and now all the sudden, the crisis has made it non-optional. I think pricing certainly is going to be one of those places, right. So again if you think about our data point of 70+% of enterprises who could benefit from an enterprise price optimization and management solution, currently not using anything other than spreadsheets, that’s a great example of a place where, wow, what are you waiting for? And if you’re not getting clobbered as a result of that today, are you prepared to say that this was a one and done, and you don’t need to be ready for the next calamity that comes along? I don’t know.

Yeah, yeah. I think you’re 100% right, I think the digital transformation piece is a big thing. It was hot, it was a big thing, a lot of companies were making that pivot, and starting to adjust, but there’s a lot that didn’t, or… and now, you’re right, like those cartoons, absolutely make sense, for better or worse, and I think honestly it is for the better. It’s a motivator, like okay, we’ve got, not like it’s a nice to have, it’s a got to have, really, at the end of the day, it’s a got to have.

There’s a lot of data out there too, I can’t site the source, I’ll do a bad job of reading it out, but if you look at sort of company behavior around the 2008 economic recession, there’s clear data that shows that companies that invested in technology, and digital transformation initiatives, during the recession, materially performed better in the recovery than companies that didn’t, that kind of hunkered down, and tried to stay the course with what they were doing, right.

Yeah.

It’s counterintuitive, because your instinct as a human, right, fight or flight, is sort of “Oh man, the world is getting really challenging, and aggressive, I better just circle the wagons and hide.”

Yeah.

But there’s lots of evidence to suggest that when the world gets hard, it’s time to kind of double down on aggressive innovation.

Yeah, there’s a similar analogy I have, so I’m a private pilot. And so they train you, you’re taught that typically, you always want to have air going over the wings. Maybe that’s cash flow, I don’t know, we’ll say that’s cash flow. But there’s a natural tendency, if you get nervous, or you lose an engine, or something, that you pull back on the stick, that… because you think okay, well that’s going to make me climb. Well you can’t do that, it’s counterintuitive, you actually need to push the nose down. So let’s say you lose an engine, you’re like “Ahhh!” No, you need to push your nose down. And yeah, you’re going to descend, but you’re going to descend a whole lot slower than if you pull way back up. And so it’s one of those things that you’re kind of like, “Ahh!” Counterintuitive, but you’ve got to do it.

Yeah, that’s right, yep.

So, well great. And I’m sure, I know, I know, I know for a fact we could go on for hours, and hours, and hours, and hours, and hours.

Yeah.

Because I’ve really enjoyed this conversation.

Me too, thank you.

But for those that want to learn more, I’m sure that they can go to check out your website, is it Pricefx.com, is that right?

Yeah, P-r-i-c-e-F-X.com.

Yeah, okay, perfect. And I’m sure, yeah, if you have any questions, that they can find out all the information, all the things they want over there.

We have a really fun automated chat bot on the site, so you can come in there and use the chat bot to help you find content you’re interested in.

Awesome.

And you can even get in touch with our sales teams and book demos, and everything else through the chat bot on the home page.

Excellent, that’s awesome, I love chat bots. So, that’s a great, great innovation. So, well Patrick, thank you so much for the time, I hope that things warm up for you, and the weather gets a little better there for you.

Thank you, appreciate it.

Well, we’ll catch you next time.

Okay, appreciate it, thanks for having me.

Thanks. Well there you go, that’s the latest IndustrialSage Executive Series, with Patrick Moorhead, who is the Chief Marketing officer for Pricefx, so the letters F-X, dot com. And you can check out more about them if that’s something that you are interested in, and you’re going through, and you need to figure out, as Patrick was talking about, how this whole digital transformation piece is really, look, it was important before, but it’s even more important now. And if that’s something that you need to look at, your pricing, your optimization, maybe you have a lot of different skus, go take a look at them, and see how they might be able to help you solve some of the challenges, in the near present, or the near future.

So that’s all I’ve got for you today, thank you so much for watching, and I will be back next week with another episode of IndustrialSage.

Thanks for reading. Don’t forget to subscribe to our weekly newsletter to get every new episode, blog article, and content offer sent directly to your inbox. You can also subscribe wherever you download podcasts so you can listen on the go!

Okay, let’s jump into this awesome episode. I’ve got Mo Bunnell from Bunnell Idea Group, and I’m super excited to have him here on the show. Mo, thanks so much for joining us today.

Yes, I’m excited.

It’s awesome. So for those who aren’t familiar with the famous Mo Bunnell, please tell us a little about yourself and Bunnell Idea Group.

Oh, man. Well, I have sort of a weird background.

What weird background?

Weird yeah, let’s start with weird. Is that how you usually stir things up?

It’s very normal, yes.

I went to college to be an actuary. So most people don’t know a lot of actuaries but you’re starting with pretty geeky stuff right away. And then while I was in school, I also loved the personal side of things too. So I loved being a deep expert in something and I loved being the personal side of things. So I ended up joining a fraternity and being president of my fraternity, in my senior year I got elected homecoming king.

Oh, wow.

And I’ll never forget my actuarial science professor, the guy who led the program, he held up the student newspaper on the week after I got named homecoming king and he said, “You know Mo, the odds of an actuary being named homecoming king are very low.” So I always had like one foot in an expertise and one foot in people skills. And I thought that was, it sort of moved to… It sort of led me to where I’m at, where the kind of things I love to do.

That’s awesome. So what are you doing now? Pursuing actuarial science work?

No, but I took all the exams, actuarial exams, but I love helping people with business development, especially experts that have to figure out how to actually bring in business. Sort of one foot in an expertise and one foot in people skills. So that whole thing that started in college, led to finishing the actuarial exams, falling in love with business development at a big consulting firm I worked at, and then about 15 years ago, I left to go off on my own because I’d fallen in love with helping others learn great business development skills.

That’s awesome. Well, so an actuary who sells right?

Yeah.

Who would have thought, right? That’s awesome, Mo. So well, and so you just recently released this really cool book called “The Snowball System”?

Yes.

So tell us a little bit about the book.

Well, it flows right from what we just talked about. There’s so many people out there, they are deep experts in something, and they have to find people to buy it. And maybe they’re in manufacturing like a lot of your listeners and watchers or viewers, where an engineer might take 10 years of experience until they know enough about what their business can manufacture before they can actually go out and lead client relationships, lead customer relationships. So those folks that have a deep expertise and also have to find people to purchase it, or purchase those services or goods that’s who “The Snowball System” is written for.

Well, that’s awesome, so I will say, we actually went with Optimum. We went to… well I’ll pitch to the audience here. We went to Mo’s, we got awesome training courses. So this is through Mo Bunnell Idea, uh… Mo Bunnell–

Bunnell Idea Group.

Idea Group, I always get that confused, sorry. Bunnell Idea Group, done. All right, got that. And so there you have public training courses back in February maybe I think we actually went and it was awesome. And so it was a three day course and I’m giving a commercial for it, so you should totally go. But one of the things that was interesting, we’ve all gone on a lot of sales, new different training courses and different things but one of the things that I loved about it is that it really just identified with our view in terms of the whole sales and marketing process. So when we believe that we’re generating leads online and creating that MQL go to that SQL process, then there’s this whole framework of how to get leads moving them processing them through the funnel. And then once they’re qualified then we start that relationship, the personal relationship. Not saying there’s not a relationship beforehand, but you know what I mean.

And so one of the super cool things that we loved was the whole methodology around sort of the thinking profile. So this is different. So for the audience out there, this was super duper cool because so Mo starts talking about and I’m going to let him talk about here a little bit just the basic thinking profiles and how everyone thinks differently and it’s kind of like DISC. If you’ve done DISC or Myers-Briggs type assessments it’s kind of like that but it’s on steroids basically, I’ll just put it that way. So Mo, tell me a little bit about – for the audience who’s not familiar – the methodology behind that? What is this? What’s HBDI?

Yeah, well, I love your parallel where you guys do such great work in how people build digital brands and build a pipeline of interest and add value and content. Well at some point a human being has to talk to a human being before they’ve got to purchase something really big and customized like what your viewers do. And one of the things that can really help that is understanding what the buyer is looking for from a value perspective, and communicating your value in that language as opposed to how you might buy the services.

And the Herrmann Brain Dominance Instrument is the best tool we’ve seen that helps people figure out what the other side is looking for and how to communicate that with them. It’s based in a ton of research. A guy named Roger Sperry, who actually won the Nobel Prize is one person, there’s a ton of other research behind it. And then a guy named Ned Herrmann figured out that there’s four major ways people think. And they’re based roughly on the physiological structure of the brain where there’s sort of a cognitive part and there’s a visceral part that’s housed in the limbic system, two little walnut-sized lobes on the top of the brainstem. And then there’s a left hemisphere side and a right hemisphere. So if you do upper, lower left, right, you end up with a two by two matrix.

And the four major ways people think based on that are two opposing pairs. One is very strategic, visionary, looking for innovative things. They want the next thing before it’s ever been done before. The opposite of that is practicality. I want to know you’ve manufactured this thing for 10 people in my industry, of about my market size or manufacturing plant size or production level. And by the way, I want to talk to every one of them and I’m really going to call them so give me the reference. So you’ve got innovation, I actually want to do what other people aren’t doing versus practicality, I want to do what everybody else is doing. The other opposing pairs are sort of the facts versus the feelings. The data, and, “Show me that if I spend an extra dollar with you I’m going to get $1.20 out within a year,” versus relationships, feelings. “Danny, I want to know you are going to deliver for me and do I trust you and I’m looking you in the eye to ascertain you give a dang about me not just making a buck.” Visionary, practical, facts, feelings.

Absolutely. I think that’s so awesome. So I can share a story with you. So yesterday, we go to a sales meeting. New client, we’re going into these creative sessions and we jump in there. We’re all, “Let’s go, we’re going to jump into this.” Essentially, it’s already been sold. “Let’s go ahead and jump into this meeting and boom, boom, boom, let’s go.” And the CEO there just stops and says, “Whoa, hang on. So I’d like to know you have three people here, tell me your story. I want to know each of you. I want to know your background and where you come from.” “Okay, oh,” and we very quickly were like, “Oh, shoot, we probably broke some protocols here.”

You skipped over that.

We skipped over some things and we okay very quickly realized this is somebody who, yes they’re the CEO, but they’re very into the story. Let’s get to know each other before it gets really… so we backed off the meeting there a little bit and said, “Let’s just connect on a personal relationship. Let’s get into that then we’ll bring in all the other things.” And I was so thankful with some of that training that maybe I’d forgotten a little bit, but remembered quickly–

But you remembered you’re like, “Oh, yeah, this is important.”

Absolutely.

And what happened? How did it turn out?

Actually it turned out really well. It was a two hour meeting and then we ended up at the bar afterwards.

Yes, I love it. I love it.

Yeah that’s probably a good piece.

Yeah, and what you just pointed out is so powerful. As a background as an actuary, or say an engineer these are really fact-based, logical thinking careers. So say somebody’s an engineer, they’re at a manufacturing plant. They’ve been at this organization 20 years; it took 10 years before they had enough knowledge that they could be an account manager, and they moved from that to sales, let’s say, now they’re going out trying to find new customers and clients for their plant, the manufacturing to support. Well, they might have a really high logical kind of thinking style. Upper hemisphere, left side. But when they meet with somebody that wants to build a relationship, they might plow over with them with all the logic and go, “Oh, well, yeah, yeah, I’ve got a family yeah, whatever. Let’s talk about our technical specifications again.” They just hit them with facts. What you did was brilliant. You picked up a clue.

No, it’s because of this guy.

You should but really you realized oh, yeah, this person wants to make the purchases on us, and if we plow them over with how awesome our studio is and our technical specifications, our capabilities and all these other stats that he doesn’t care, he’s assuming or she assuming that we’ve got that or we wouldn’t be in business. They want to know we give a dang about them. They want to hang out at the bar and hear about our families and have us ask questions about them. And that’s what’s going to create the yes at the end. So you flexed. So this ability to flex to the right, one of the four quadrants is huge. It’s so important, it’s not taught in schools, and it’s one of the most important parts about having a real deep, long-term relationship.

Absolutely. And you talk to, it’s just really, it’s like talking in a different language.

Yeah, it is.

And it was interesting, because to share, we had lost– we had several issues, or we had lost deals and we were thinking, well, what in the heck? How did we lose this deal? Because we had everything lined up, we had it this way and we talked about all these different things. And it was interesting after we’d gone through some of the course, we were evaluating the thinking profiles we’re like, “Oh, shoot.” We’re admittedly sometimes not the most detail-oriented like here’s the process, all these things. And we’re like, “Oh, we gloss over that. They don’t care about that, they’re more excited about innovation and about, here’s the things that we’ve done before.” And you realize, oh, that person actually really or they really were very process-driven. They really wanted to hear these different steps and shoot, that’s probably where we lost it.

Right. You might have been selling innovation and what they really wanted is something that’s tried and true that’s been done 100 times before.

So anyway, the course was very helpful for that. So I’m assuming that in the book, you get into a little bit of that, just a little bit.

Just a hint. Yeah. What’s interesting is that little two by two, those four quadrants are so powerful. We just gave one example like an introductory meeting. But it also gets woven and we go into great detail in the book, but also gets woven into how do you ask for the next step? How do you overcome objections? How do you talk about money? Well, you do it differently from the different lenses. How do you close the deal? How do you add value afterwards in a way that’s far above what the client or customer expected? So that they’re going to become a raving fan. And then every single one of those steps has more behavioral science, psychology, neuroscience in it, which we cite in the back: over 30 studies. And then every little aspect of the buying system, if you will, the creating a buy is based in science and based in those four quadrants.

I feel it, that’s excellent. So there are a couple little snippets we could pull out of here also?

Yeah.

What are some good examples out of here just in terms of like practical application that somebody from our audience might–

I’ll just give you one example and see if you like it.

All right.

Because I think this might come out after, it’s in the book, but it might have come out after you were in the training can’t remember.

And holding out on us, okay.

Yeah. You’ll have to tell me, you give me a grade. You can grade without fear.

Yeah, sounds good.

Some recent research came out of Cornell University in Western University, which is up in Canada and they tested an email request for an ask, if you will. Will the person say yes or not? Psychologists call that compliance. Will the person say yes or no? An email request versus the exact same thing asked face-to-face? Guess which one has a higher compliance rate or higher chance of a yes?

Face-to-face.

Bingo, I guess this… I’m putting you on the spot. Guess what percent the face-to-face is better than the email?

90.

Ah, 34–

Really?

Times.

Times!?

Times.

All right. Well, you said–

Isn’t it?

Oh yeah, it’s okay.

I set you up.

Trick question.

I know, I know I said percent. That’s another thing called anchoring but we’ll get all that. But 34 times, we have super powers when we’re in person and so many technical salespeople or account managers, because they might have more of a technical bent they might be shy about asking something in person or maybe they don’t… plan for enough. There’s a process about planning for sales or business development meetings in the book that’s incredibly fast, efficient and powerful.

It’s powerful.

Yeah, right you’ve been through that. So planning for our face-to-face times in a way that we’ve thought out everything that might go wrong, everything that might go right. What’s our vision for the meeting? What are we going to ask for? Because we have so much of a better chance to get that yes in person than if say, we wait till two days later and we ask for the same thing on email. It gets lost. It takes a month for somebody to reply, we turn into a nag. “Hey, did you get my question asking following up on my email following up on my voicemail?” So that’s just one little snippet of behavioral science that once you know how much more powerful we are in person, boy, that makes you think I need to plan better. I need to think about that referral I might ask for. I need to figure out what is the next step I might ask for in my own selling process, things like that.

And that’s awesome. I don’t know that example you have there, it totally, totally totally, totally resonates.

You were saying a thing about meetings you had last week?

In a painful way, yeah. Absolutely, but I think again and it’s been several months we’ve gone through it. And we’re still drawing from it, there’s so much there really that you continuously can learn more and draw from. We haven’t implemented everything with it, but I just think it’s really the basic foundation of saying, listen. Just that understanding that not everybody thinks the way that you think–

It’s huge.

And just that starting question and just that thought, okay, maybe I need to rephrase how or represent something in a different way was very revolutionary for us, absolutely.

There’s one more piece I remember you talking about after the training, do you mind if I?

Oh, please open the wounds.

No I remember this and I think it’s particularly important for super technical salespeople, account managers of big manufacturing facilities. And do you remember the IKEA effect in building everything together?

I vaguely remember this. Oh, shoot, you put me on the spot here.

I know.

No it’s okay.

Well there’s going to be a test…

That’s my job to put you– I’ve got it right here.

Well, I think it’d be interesting to your viewers, I’m pretty sure. The IKEA effect was first studied by Michael Norton out of Harvard and Dan Ariely out of Duke. And what they found was that people buy into what they helped create. So let’s say that yeah remember that.

I remember this, yes.

Building everything together. In the study that they did. They measured this in dozens of ways. The way I liked the best was they gave people IKEA furniture that was already put together and then they were asked to go sell that in a controlled marketplace and if people in the experiment thought they were being judged on how high they can negotiate a price for this IKEA table set, there were some different types of furniture. And if you have enough people do that you can sort of create what’s the average amount that a person can sell this furniture for? That’s the control group. The experimental group was the exact same thing except they had to put the furniture together first. Guess who sold it for more?

The people who put the furniture together.

You got it. See? You passed the test.

Yes.

All right. But what’s interesting about that, when we turn it to that concept on business development is so many technical salespeople we see, will meet with a client, customer, prospect and the person says he or she says, “Hey, can you send me a proposal on that?” They run back to the ranch, get 20 people together, they spend 30 people hours figuring out how they’re actually going to run this through the plan, everything else, and they fire over a proposal without ever testing any of their ideas with anybody. We call it throwing it over the wall and their chances of getting a no is very high because the person hasn’t bought into it. They haven’t built it with them, they haven’t built… They haven’t bought into what they helped create.

A different process is if we can think about those four areas you lead off with. What’s the strategy? What’s the process? What’s the team we need to get it done? Your side and our side. And what’s the pricing? And we find when people get incremental yeses in the four major ways people think verbally, over the phone, quick emails back and forth. Then when they fire the proposal over the wall, the person’s already bought into all the major parts of it. They’re excited about getting it and you’ve got a higher chance of a yes. So incremental yeses leads to an easy yes at the end, doing it all yourself and throwing over the wall gets to a high chance of a no.

Tell you it makes a lot of sense.

What’s your thoughts?

Oh, absolutely. 100%. I think there’s two parts to it. One is getting and you hear this a lot too, getting somebody just familiar with saying yes. You say I think the big thing is asking questions: “Would it be helpful if we did this?” And if that’s built into the process and in that step so it becomes a little bit more natural. That’s okay, yeah. But the other piece on it is going back to the IKEA effect is really we say building that together with the team. So like you said, it’s a shared value and we’re approaching it as a us versus this is what we’re going to do for you versus this is what we’re going to do together.

Yeah. I love that. I love that phrasing even and you get you be… the folks who are watching this, you get to meet them all the time. Does this fit with what the viewers struggle with?

Absolutely.

Or deals with?

Yeah and it too depends on who’s specifically watching, what type of product they’re selling? So for example, if you’ve got… We had well a couple of weeks ago, depending on when this episode hit, we had Craig Henry from the Siemens Digital Factory, and they’re selling big industrial automation applications and solutions to warehouses. These are multi-million dollar solutions, and it’s not something that someone’s going to go to a website and click a button and say I’m buying.

Yeah, I’ll take 10 of those.

Exactly, although I’m sure they wish they would.

Can they be delivered in two days?

Well, they do, I’m sure, ask for that. But the reality of it is, is that it’s a long process, it’s very iterative.

Customized I would guess?

Yeah, slightly. That buyer versus somebody that’s saying, “I need to buy 30 cryogenic tanks for that whole liquid nitrogen gas,” or what have you. Some of it can be a little bit more commoditized versus others, but ultimately, once you’re looking at that you start getting a little bit more solution selling. And if you’re working around, “I’m not just selling you a product, I’m selling you a solution,” that’s where it makes a huge difference. Because people come in and totally say, “Oh, well we need 20 of these things.” Just like “Well, that might not necessarily be the right application, but we’ll go ahead and send you the pricing and the proposal or whatever,” versus jumping in. Well, it’d be helpful if we’ve got a guide for it, What would be helpful we’ve got this webinar coming up that talks about, it’s a fit guide on this application or what have you with that in doing that. Because I think that the challenge, I think everybody kind of struggles with this a little bit is that there’s a thing sometimes called the quota.

Yeah. I totally agree.

And so there’s this balance of I’ve got to sell, I’ve got to do this. We have to whatever. And let me look at my pipeline. I think that’s a trick too, is like let me look at my pipeline revenue. Well, is it real pipeline, or is it, we’re just inflating this stuff? Yes, technically they could but are they really going to? We’re pushing the sale too early. I think that’s a big challenge.

I think you nailed it. And one of the first tenets we crush in the book and in our live training is always, 100% of the time treating the prospect, the client, the customer right. That it’s always about that. You’re always playing the long game. And you’re right in that when people, even if they believe that philosophically, they can fall into some really bad habits, if they feel pressure because of quota, or I’ve got to hit my number by the end of the month or quarter of a year. And a lot of the techniques that we talked about in here, whether it’s neuroscience, psychology, behavioral science, a lot of those are on the why do people say yes to things, talking about the clients, the customers, the prospects, but a lot of them in the book are turned on ourselves too. How do we hack our own habits, so that we’re focused on the right thing day in and day out. So that we will hit double that quota at the end of the year.

Yeah, absolutely. And there’s again to give you more of a commercial. But there’s a… we love the framework in terms of the thinking of that. Again, we’re just big fans of taking that digital component. So if you’re audience out there listening, taking the digital component of being with a prospect leads, where we get them, generate them, process them, they’re getting through a process, but then once it gets kicked over, like when you go from MQL to SQL they’ve hit a certain amount of… they’ve watched certain amount of videos, they’ve downloaded a-must download, they’ve got enough webinars what have you. Whatever those metrics are? Then we kick it, then it’s like, okay, here’s a framework on how to continue on and kind of process them through. And also too, if you’re more of a traditionalist outside sales too, I mean you’ve got to get out there, you’ve got to shake the bushes, if you will. Is that the right terminology? Shake the bushes, whatever.

Yeah it’s cool. Let’s shake the bushes.

I know I love one of the things that’s saying, “Hey, here’s the top 100 list or the top 10.” And it’s almost like going after these, these are my top key accounts I’d love to have, playing the long game here. We’re not going to sell them tomorrow and just having a framework on how to process them through, get them from they don’t know you from Adam to here’s how we’re going to move from this stage over like we know who we are now we’re going to provide some more variance all around value, value, value, value.

Yeah, exactly. One of the things that we talk about in the book, to a large extent, what you experienced in the class, is we found from a behavioral science perspective, seven key steps from target – in a relationship where I’d like to meet this person, but I haven’t yet – and the seventh step is they’re so excited about our services and how we’ve delivered that they are actively telling their community about us. They’ve turned into sort of a referral source or a raving fan, if you will. And what we see a lot of times when people move to that human part of the pipeline, like you talked about, is we tend to judge our relationships on things like, “Oh man Sue hugs us, she loves us.” Well, newsflash, Sue hugs everybody, she hugs your competitor, she’s a hugger. That’s not a good benchmark of a relationship. So we’ve got seven steps in the book and in the classes, where you can look at the behavior of your customer and that will tell you where you’re at in seven steps. And the beauty of that is, that if you know where you’re at, you know what to do next.

Right. Yeah, I think that’s such a big struggle is you can get up to a certain point, you’re like, great, what next? What’s the next thing? So then that really helps to be able to kind of facilitate that and we’ve had a lot of takeaways in terms of hey you get stuck, somebody’s gone cold. What do you do?

What do you do?

What are some options? Obviously, the objection handling is a great piece. Another piece of love, love, love, love. Because this is echoed in the digital marketing strategy as the give-to-get.

Oh yeah.

So talk a little about the give-to-get.

I love the give-to-get, I love it. There’s a whole chapter on it. So let’s say that somebody’s gone through a lot of the digital pipeline and they’re interested. They’ve attended three webinars, they’ve downloaded some white papers, whatever, whatever scoring system we’ve got, this is a hot one. And a human calls them and or they even reach out to us sometimes. And what do you do next? Well, the key in that first interaction is to get another interaction and to your point before a lot of times people in that first phone call, that first face-to-face. They try to sort of go all the way to selling the farm, getting married on the first date. A little awkward.

Yeah see how that goes.

Yeah, look, I brought all these paraphernalia and sheets I’ll leave with you and here’s our pricing and would you like me to send a proposal? It’s just too much. So instead of trying to get married on the first date, let’s date a while. So what the give-to-get does: it says you’re such an important prospect of ours. You can be really specific and authentic because you’re a Fortune 20 company or you’re in this space or you’re… whatever the criteria be genuine but if it’s true, say because of that criteria, we want to invest in you. We would like to fly in Jane from the whatever plant to spend a couple hours with you evaluating what you’re doing now and providing some guidance on what you might be able to do better. And that might be… there’s four major ways of thinking. So there’s four major give-to-get, it might be a strategy session, it might be evaluation of your process, it might be a look at your numbers and how you might be able to prove some kind of efficiency or ROI or value, or it might be a networking event where we’ll connect you with somebody else that’s done the things you’re looking to do.

So those are four ways of thinking we might work through and those are the four major give-to-gets. And what we might do then is, in that first meeting say, “Hey, would it be helpful if we did the thing?” Whatever it is, whatever is appropriate and get that second meeting in the first meeting, where we’re back in front, we’re offering value right out of the gate, we’re giving first as opposed to throwing proposals at them like Machine Gun Nelly. And they are so excited to get that gift that there’s some reciprocity and they want to give back to us. And now we started the whole relationship in a fantastic way where we’re helping, as opposed to selling. Is that where you wanted to go?

Absolutely, yeah. Providing value.

Providing value. Bingo!

Provide value.

Exactly. And then if we’ve lined up that, what we go into great detail in the book is, we’ve got our eye on these really big projects, so really big work we could do with somebody, and then so we’re aiming in that direction, but our give-to-get is very aligned with that. So what we would want to happen at the end of the give-to-get is somebody says, “Guys this has been amazing. You’ve added so much value, what would it look like if we work together to do the stuff we just covered?”

Oh, well, yeah.

Let me show you. And you almost get them asking, the prospect asking, how can we work together? We love you guys.

Yeah, it’s like testing out the relationship.

It is.

It’s, “Let us provide value,” and naturally the lead is like, “Oh, this was awesome.”

Exactly. Yeah, I like that word test. It’s like a taste of the experience of working together. We’re on this like you said before, we’re sort of on the same side of the table working together to accomplish something. And the behavioral science behind gives-to-gets is amazing. I can go into it if you want but Dr. Robert Cialdini at Arizona state, the super quick version is he found six major things that were influential to human beings. The give-to-get is the only technique I’ve ever seen that hits all six.

Wow, that’s interesting. That’s awesome.

Super powerful, much more powerful than it appears.

Well, listen I’m just excited. I hope a lot of our viewers go get this book and in just a minute I’ll share where they can go get that and then take a look at everything. But as we’re wrapping up here, because we could go on for hours and hours and hours obvious.

I thought we were going to stay till like 8pm? I told my family I was going to miss dinner.

Oh, dang it. Well, yeah, well we could maybe I might have to get the bourbon out.

I’m in.

I thought you might be. But, any last in as we wrap up any last parting thoughts that you want to leave with our audience?

I would say there’s three big things to handle for growth. And I’ll give these to everybody in the audience, because you can sort of evaluate how you’re doing in these three areas. The three areas are how are you managing opportunities? And are using a proven behavioral science method to guide your prospects from one step to the next? And are you proactive about guiding them? The second thing is how are you managing your relationships? Relationships are different than opportunities, because of course, some of your relationships are people that can buy things but other people are referral sources. There are people who call the same people you do, but maybe they don’t sell the same thing. So they’re partners of yours. So how can you orchestrate the growth and the deepening of your relationships? Or are you doing that in a systematic way?

And then the third thing is how do you manage yourself? It’s so easy in sales and account management to fall back to a reactive mode, to almost judge your efficiency by, did you keep your email load down? But what that does is it pulls you into being super reactive for the people that are reaching out and you want to manage yourself in that third bucket of how can I be proactive and go after the big targets that maybe we don’t have it in yet? But we need to because it’s a crying shame they’re not buying from us. So manage your opportunities, manage your relationships, manage yourself. I go into great detail in the book on those but when people are really humming on all three of those, that’s when they’re winning.

That’s awesome. No it’s great. Oh my gosh, so many nuggets, so many snowballs so it’s perfect.

It’s a snowball.

I mean it makes sense. You start small and then you grow.

Think big, start small, scale up.

Totally makes sense.

I love it.

Mo, thanks so much for coming on. I’ve really, really enjoyed it.

I’ve been looking forward to this for like forever.

Yeah and me too, we’re super excited. So I know this is going to be a big hit with our audience and they’re going to eat this up.

Good.

So thank you.

Yes.

Thank you so much. All right, so you heard it “The Snowball System” Mo Bunnell with Bunnell Idea Group, it’s awesome. You can get this if you go to snowballsystem.com you get this awesome book. Listen, I’m telling you we’ve gone through this and it’s really a game changer. And it’s really going to help to complement those digital marketing strategies that you’re looking to implement, you’re putting in. And it’s going to really help with your sales and market. Look, we know that there’s a gap, we really want to bring the alignment between sales and marketing together and this is a great way of doing it. It really leads into a lot of things we talked about here on industrialsage.com and also I’ve got a little note here there’s also some more information on createdemandcourse.com there’s a lot of other information there and I believe an eight part video series, eight part video–

That’s our free digital marketing for your viewers.

They’re even doing that. That’s great.

Yes. Well, we love using you guys. So yeah, if somebody wants an eight part series on creating demand that covers some of the things we talked about, but in a lot more depth, it’s free. You go to createdemandcourse.com you sign up and you’ll get all that great content.

Awesome. Well you guys should be familiar with that, because that’s what you guys are all doing hopefully. So again, snowballsystem.com and createdemandcourse.com And man, this is it. This has been an awesome episode: lots of takeaways, probably too many to cover right now. Well we could have gone on for hours and hours but the reality of it is, provide value, really manage those relationships. I think a big key takeaway that Mo talked about at the end is that everybody that you’re going after might not necessarily be a sale, okay? And that’s a big… but there’s still a lot of value there. Provide value to them, they could be a referral source, and so anyways and the other piece is really just thinking about that thinking profile. Not everybody thinks the way that you and I might think and so when it comes to selling that, you might have to retool or rephrase like if you’re like I’m the people person versus big ideas that might be a little bit of a struggle, you’ve got to retool that a little bit.

So anyways, awesome episode I can’t encourage you enough to go take a look at this. Go get this book snowballsystem.com that was a joke I made earlier that’s coming back. But anyways, thanks for watching if you have any questions, we’d love to answer them on the show industrialsage.com/questions. If you’re on iTunes would love a review and feel free to share our content on social media. We’d love it. So for this episode, I’m done. I’m going to stop yapping. I’m Danny. Thanks for watching IndustrialSage.

Thanks for reading. Don’t forget to subscribe to our weekly newsletter to get every new episode, blog article, and content offer sent directly to your inbox. You can also subscribe wherever you download podcasts so you can listen on the go!

All right so let’s go ahead and jump into today’s episode. Monique, thank you so much for joining us here. For those who don’t know who you are, could you please introduce yourself to the IndustrialSage audience?

Absolutely. Thank you for having me. My name is Monique Elliott and I am the Global Head of Customer Experience for ABB’s electrification products business.

Excellent, so tell me a little bit about what’s a day in your shoes like? What do you actually do?

I will tell you a day in my shoes these days is very different than it was say a couple years ago. So I am in the midst of helping the organization really transform and revamp the marketing function. So, a year ago my role would have been the Global Head of Marketing, or the Chief Marketing Officer, and today we’re really transforming and evolving that function into customer experience. So I spend a lot of my time educating and trying to understand the different parts of marketing that the company’s doing today, and how we can make that more contemporary for a very industrial market.

That’s great. So I love, and like with every guest that we have and we have a kind of off-camera banter and whatnot, but one thing that kind of just came, I’m going to ask you a question off-script.

Yeah.

So to speak. There’s nothing off-script here but, I’m fascinated by the customer experience function and the fact that you said that maybe a year ago it was Chief Marketing Officer. Tell me why your organization has decided that hey we need to be focusing on this a little bit more.

So I think it’s really twofold. First of all, not having a strong focus on the customer, I think was doing the function a bit of a disservice, and so language matters, and in this case marketing in very traditional industries or very industrial industries tends to mean something that was a little bit more old-school around the development of brochures, and maybe we made marketing collateral or we went to trade shows, so constantly or consistently calling what this function wants to be marketing I think was doing it a bit of a disservice. So the first reason for changing it was if you change the language then you can start to change the way people think about it. The second reason was the insourcing of talent, and so marketing in education and in a lot of the universities was starting to change, the curriculum was changing, and so that’s also a way to in-source new talent is to start talking about the function a little bit differently.

Absolutely. Now that totally makes a lot of sense. We’ve undoubtedly seen a dramatic change, not just in industrial markets but just across the board relative to technology and marketing. What would you say just in terms of the need for that change now, just as it relates to just that whole cultural change that we’re seeing?

Yeah, well I think a couple things are happening. There’s a generational shift that’s beginning to happen in a lot of the more industrial markets, like the one that I’m in, the electrification products business, and so as you start to see buyers’ behaviors change, there needs to be an evolution of the function as well, and that’s what we’re starting to see. Now granted, I would say that this industry is maybe 15 to 20 years behind where our friends in the retail space is, so when I talk to my friends in retail, they’re like yeah, we were talking about that 18 years ago. That’s okay, it’s a bit of a latent shift, but it’s happening now, and so as our distributors or as our customers are buying differently and their behaviors are changing, the manufacturers have to do the same, and so really I think it’s all happening because finally the generation of the workforce in this industry is catching up to where the retail space is and it’s forcing the manufacturers to change as well.

What is the biggest change that you’re seeing? You said you’re seeing that in the workforce, like what’s really the biggest change for you, concretely?

Yeah, I think a lot of it has to do with the search of the product, so whereas before you very much had a sales force that would go out, and we do a lot of our business through distribution, and so it was very much, and it still is, a relationship-driven industry, but a lot of the search now around hey I want to buy this product, what are some other manufacturers, is all being done online, and that is probably the number one change that we’re starting to see. So the purchase may still happen offline, and the relationship still needs to be there, but it’s the searching of the product is changing to how you and I would search in our personal life, and that’s causing the marketing functions to think a lot differently about how they engage customers at the beginning of that buyer journey.

When did your organization start making that change? Was it something that was just within the last year or two, or was it, you started seeing this a couple years ago, what did that look like?

That’s a really good question. So prior to being with ABB I was with General Electric for 15 years, and I would say we started to see the change in that organization about four years ago, maybe four or five years ago. We decided to stand up a customer experience team that was all focused on digital. So it was focused on the digital marketing piece, and that was the start of it, that was how it started and now as I’m transitioning over into ABB, we’re starting to now make that transition as well so I would argue in this industry, probably within the last five years.

Okay. So when you said you guys started to transition to digital what did that look like initially? Was it, I mean, like specifically what was that?

Sure, so initially it was exactly as you would think it would be. Let’s do some email campaigns. Digital marketing meant let’s do some email campaigns, and then you start getting into well maybe we should have our own kind of like digital content that’s available gated on our website and you start to get a little bit more sophisticated. Where we’re at now is really partnering with other types of industry thought leadership or kind of like think tanks around having our own cul-de-sac of digital content, where customers and partners can come in, they can consume your digital content, and you, in return, then kind of exchange, more of an exchange of leads. So that’s one area where it’s starting to advance. The other area of where, again, for us in our personal life we would think we’ve been doing this for a really long time is just around the SEO, and the search engine optimization and all that fun stuff that you get when you go browse on Amazon and what have you. But I would say it started as you would expect, email campaigns, and now we’re starting to get into more personalization.

Yeah that’s great. Personalization is such a big thing, and we’re going to see that just continue to grow, just across the board, even back to product development, but certainly, obviously in your marketing. I love the analogy of the digital cul-de-sac, is that what you called it?

Yes, yes.

I love it. So we’re basically having a block part out with everybody with like-minded people, like come on over kind of thing, basically.

We’re having a lot of fun with that, ’cause a lot of our other partners in this space so magazines, for example, they’re realizing not a lot of people are actually picking up a magazine anymore, so as they start to transition their content or their engagement into more of a digital or an online avenue, then we’re following suit and doing the same, and we’re actually having a lot of fun with it.

That’s awesome. What are a couple things that you guys have participated in that have been a lot of fun?

Yeah, yeah, yeah, so we’re partnering with a company by the name of EC&M Magazine, and what we’ve done with them is we’ve set up a contractor business resource center, it’s like an information center, specifically for contractors, and what we did is we went out and we asked them hey, what do you want to hear about, like what do you want to learn, so we surveyed, and found out that they’re very interested in how the standards are changing, and some of the functionality of the products, and so we just started putting some, similar to what we’re doing right now, some thought leadership material out there, thinking maybe we’ll get a couple hundred people. Thousands, we had thousands of people coming, interested in these webinars and interested in the content, and the engagement between these contractors was really, it was actually very inspiring, ’cause this is generally people who just want to learn and get better at their craft, and so we realized that it wasn’t just about hey, how do we sell more product and how do I get some leads, but it was about how do I connect people who might be struggling with some very similar challenges in our marketplace, and in our industry. And a lot of these are independent contractors who don’t necessarily have the resources to go and do this themselves, so I love this idea of creating communities for part of our market that’s just starting to get into the digital space.

That’s fantastic. It just sounds like it’s a lot of empowerment, a lot of training and education, and I love it ’cause that does really identify really well with what you’re talking about, like the whole customer experience there is really, what it sounds like is you’re helping to solve their challenges, really at the end of the day saying here are issues that we know, and let’s not try to throw product down there, cram product in, it’s all over the place, because that was more five, 10, 15, 20 years ago. Not working anymore. So I absolutely love it how you are really engaging, engaging right, especially even downstream too, especially with you guys are working, I think you said primarily through distribution.

That’s right.

That can be a little bit of a challenge from a manufacturer standpoint as those touchpoints down to the end user.

That’s actually a really really good point because a lot of the early digital marketing that we were doing was geared more towards our distribution partners, and to your point it was like a product launch. Hey we’ve got this new product, come buy this new product, and shifting away from that mindset of marketing into, you said it nicely, we’re trying to solve your problem, hey listen, if we have a product that can do that for you, that’s great, but if not, at least maybe I’ve connected you with other people where you can kind of work through this together. It’s a very different way of engaging customers. In a way that’s, to be honest, I think it’s a lot more meaningful.

Absolutely, and there’s an analogy, we had a previous guest on here, he was a sales trainer guy, we went through some of his training stuff, and his name was Mo Bunnell, a great guy, I’m giving him a little plug, but one of the things we were talking about relative to sales was just really playing the long game. So instead of– we’re being super transactional, saying, “We’ve got to make the sale, we’ve got to make the sale!” Which, listen, we’ve got to make sales, right, you’ve got to make, cash is king, cashflow, it’s important, but, we’re really talking about playing the long game where we’re really building a brand of saying listen, we’re here to help you, and we want to be a solution provider, or one of the words I love is partner versus vendor. I hate that. I hate hearing oh, these are our vendors over here. It’s like well geez, maybe we’re not as valuable as we thought, maybe we should provide some more value there, and that’s exactly what it sounds like you guys are doing over there, and that’s awesome, I love it.

Well I need to elaborate on something that you said ’cause it’s really important. That whole customer buyers’ journey, and how you want to be with them throughout the whole process, and I think that was also a really important factor for changing the language around marketing, because when you talk about customer experience you’re talking about every single touchpoint, and so yes, ultimately we’d love to make a sale, right, we’d love to have the order, but before we get there, let’s think about the experience that our customer has, and it is truly a very different way of thinking about this function versus marketing, which always has the connotation of I’m going to try to just sell you something, I’m promoting. That’s what marketing is, to promote, right, and so this is really about understanding the customer experience, and so when you think about the function in that context I think you start to look at different touchpoints along the value chain well before you get to the deal, well before you get to the order.

Absolutely. So one of the things we were talking about, I mean this is great, playing the long game, and you’re providing these, with the webinar, so the digital cul-de-sacs, you’re able to really help provide their challenges, with the SEO I imagine it’s putting out a lot of content out there that’s valuable so you can drive traffic back to your websites, and I mentioned a little bit how sometimes marketing, in the past in particular, and now too, can be very transactionally minded, and that can be very very challenging when it comes to I guess really getting buy-in, to really like make that change and say no, we need to do this, and I know we’re not going to see the sale tomorrow, but this is really important. That is probably I’d say the number one issue that we hear all the time from our subscribers and people is getting that organizational buy-in. What would you say, how can organizations, how can marketers, how can other CMOs or customer experience officer, how can we tackle this challenge?

I would say that the challenge is real. The struggle is very real on that one. I think we can all appreciate that marketing is often seen as a class center, and it’s really hard to get a seat at the table. And so one thing that my team has done and really this is just a credit to a specific part of the organization that was also around demand generation, was start to actually track the marketing activities down to every single marketing activity, so the email that would go out, the webinar that would go out, that lead from a trade show, and be able to tag it and follow that activity through the CRM, all the way through the whole process until you can see whether or not an order was received from it, and really get that marketing ROI.

Now, I say that and most marketers would probably push back and say, “That’s really hard, Monique, like how do you do it?” So it’s a process. It’s two things. One, you have to have a process to be able to track that, and two, it’s the marketing automation and the technology stack that you need to do that, because you have to have some kind of marketing automation tool that allows you to track that activity, and then you have to integrate that into your CRM. So through the work through my marketing team, we were able to do that. It took about a couple years, and a lot of integration and a lot of process but now we can say, so this year we spent four million dollars in marketing activities but it yielded 22 million in orders.

It’s not easy, it takes time, but if you can get to that point, then you can have credibility for the function, but also what you can do, which I think is really important, is you can say let’s not do those activities anymore ’cause they didn’t yield anything. I think that’s a problem that marketing often has is you don’t want to stop something ’cause you’re not sure if it yielded something, and what if I stop it and then I won’t, so it gives you a lot of more freedom to be able to stop doing things that really aren’t getting the results you want.

I love it. That’s awesome. Really, at the end of the day it’s closing a loop, looking at marketing activity relative to sales, and yeah, that can be incredibly challenging, if not impossible without the right tools. Even with the right tools, it can still be difficult to do.

No, you’re absolutely right. Yeah, it’s that whole demand generation process. It’s the process and the technology together, absolutely.

Now that’s awesome. And so how, you said it took some years, it’s not something that you’re going to all of a sudden turn on, and contrary to popular belief, and hey great job with the marketing automation. You just buy this, and then you flip a couple switches, and it just works, right? Something like that. It’s very easy.

No, no. Here’s what I always say to people. Whether it’s marketing automation, e-commerce, which is a huge area that we’re playing in right now, it’s really never about the technology. It’s always about the process, ’cause the technology will do what you tell it to do, right, you give it a bunch of ones and zeroes, it’s going to do what you tell it to do, but if your processes are broken, if they’re fragmented, if you’re not able to standardize, it’s not going to work, and so that is always more critical than the technology.

I agree 100%. So if I could recap on what you’re talking about there as far as the organizational buy-in is really track marketing activities, making sure that it’s measurable, and then reporting that back, so say okay, well this is, we have metrics on this, is this good, is this bad, and different, I don’t know, but at least we have the data and we can look at that and eventually we can look to tie that back on sales and say look, this activity, this webinar that we did eight months ago, we have all these different touchpoints throughout the process and then boom, sale over here, or hopefully shorter than that, but it depends on your sales type I’m sure.

Agreed, agreed. Now some folks may come back and say okay well what do I do in the short-term. I don’t have that time. I don’t have that investment to be able to do that. I think some other things that marketers or customer experience leaders can do, show how the market is changing. Proof points are work great, right. What are your competitors doing? What are our customers doing that’s different? Get connected outside of your own organization so you can be a little bit more connected to how the landscape is changing around you. I think bringing those proof points back and those examples back to the leadership and back to the organization, it helps, versus just saying I believe it to be. This is why it’s actually changing.

Totally, and so on that point, for any of our listeners who are listening or watching who, we did a big survey, we talked to about 150 manufacturers to get data on exactly what you just talked about, to find out what they’re doing relative to digital, what they’re not doing, what they’re looking to do in 2019 and beyond, and so if that’s something you’re looking for, go download that, there’s a button somewhere on the video or in the blog article you can go get that, but to help address that problem, to say hey, it’s not just like, I think that we’re fine versus I think we need to make a change, if you’ve got that data. And I love what you said too about talking to your customers, like go see what they’re doing. That makes a lot of sense. That makes a lot of sense.

In this space, I really fundamentally believe that we’ll push and pull each other along. So as the manufacturers get a little bit more sophisticated and a little bit more contemporary in their marketing, so will the customers and vice versa. So if I have a distributor partner that really wants to push the envelope from a digital perspective, I have to follow, I have no choice to follow. One great example that we haven’t touched on yet but I think is really important is around the need for the digital content, and when you think about the product management organizations in these very traditional industries it’s not native when you are releasing a product to say I need all those digital aspects to go along with it. The specs and all of that, that’s one thing, but it’s all that enriched content, it’s just, it’s not native, and that’s something that we’re getting a lot of pressure from our distributor partners in order to improve because they want to improve as well.

Yeah.

So, going along with your customer on this journey I think is really really important.

That’s fantastic. That makes sense if you think of your typical product launch it may just hey, there’s a whole different suite of assets that you need to have that need to go part and parcel with that. You touched on something, or you made me think of something there. A lot of manufacturers kind of struggle a little bit with marketing activity related to sales, specifically when they’re working with a lot of dealers or distributors, because unless if you’re dealing, well actually let me ask this. Percentage-wise, or at least anecdotally, how much are you going through distribution versus selling direct?

About 70%. It’s fair to say, yeah, about 70%.

Okay, so unlike going direct, which it’s a lot easier to come back and say okay boom, there’s the sale on here with the distributors and dealers, depending on how that’s set up. How have you managed to kind of track that and look at that, ’cause that can be even more difficult to try to figure out how have we made an impact here?

It is, it’s very difficult. It’s very difficult. I mean, it’s knowing your installed base when you go through distribution can be a big challenge. I think this is where having partnerships with your larger distributors is incredibly important. One of the things that we’ve been trying to do over the last couple of years is really engage with some of those larger partners and say maybe, can we go and embark on this together. So let’s identify maybe two or three kind of transformational, digital transformational projects that we’ll work on together, and maybe it’s getting better at the digital content, maybe it’s having more online promotions together, maybe it’s looking at pieces of technology that would help both of us, but setting up these strategies almost like you would set up an annual strategic sales plan with one of your partners, do that around marketing with digital, and follow that, it should really be no different, and I think, but that’s a little, for a marketer, that’s a bit of a different approach, but that’s one way to do it, is to really partner together on this and track the progress that way.

I love it. Totally makes sense, like treat the sale, ’cause a lot of times sales sometimes, they get all the budget, they get all the, and marketing over here, well, you know, well you go make your brochures, right. It’s changing now. It sounds like it’s changed in your organization.

Yes. It needs to change. It needs to change. We’re talking about this now in the context of customer experience. There was an iteration there before which was around commercial marketing. There was a time in my life where I remember we were moving away from traditional marketing and then it became well I’m a commercial marketer, and that got you a little bit more credibility, because you’re like, I’m not a communications marketer, I’m a commercial marketer, so I want to be treated as such, right, like give me the budget, hold me accountable that I’m going to make an impact to this account or I’m going to make an impact to this partner, and now we’re evolving to more of this customer experience, so there is something to be said about approaching marketing as you would a salesperson.

Yeah, well it’s scalable. Marketing sometimes doesn’t get sick, although sometimes they do, maybe, depending on your marketing organization, this plan there. So, one other question that I have, and I forgot to ask this early on, and I totally should have. For those who aren’t familiar with your product line, what do you guys manufacture? Tell me the industries and everything that you’re in, just so we can have a little bit better frame of reference.

Absolutely. So we are in the electrification products business so think about it with medium and low voltage electrification products, so circuit breakers, the large industrial ones that you would see in commercial buildings, as well as the breakers that you would have in your residential homes as well. Also EV chargers, which is a fabulous market and an industry to play in right now, getting really sophisticated as it relates to e-mobility, and then when you think about that products that you really play across a lot of different segments. So you can play in the commercial and residential construction, you can play in renewables, buildings, food and bev is another big, data centers is a great example, so think about places where you need to turn on electricity, that’s where we play, and what I love about this product, and what I love about this market is it can be a bit of an invisible product. Like how often do you think about the breaker that’s in your home? You know when you think about it? You think about it when it doesn’t work, when you’re sitting in the dark.

That’s when you think about it, yup.

Exactly, so it’s these types of products that are really critical to our everyday lives that people really don’t think about, and it’s how do you bring that awareness to folks, and to be honest, and we said this before, kind of in an unsexy environment. How do you make marketing sexy with these types of products?

Well, my great next question on that, how do you solve that challenge where you’ve got particularly a product where it’s not necessarily a, let’s talk about, I don’t know, residential or commercial breakers or units, okay, we’re looking at A, we’re looking at B, we’re looking at C, how do you differentiate?

Well I think a big portion of that and where this market is really going is around the connected devices. So it’s not just about that one particular product, but it’s how does this product interact and connect with everything else. Let’s take your home, right, with everything else in your home, and in this concept of an augmented home, and now you’re starting to get to a different level of kind of switch a little bit and talk about value props. Now you’re starting to develop value propositions that really mean something to people. So it’s not about just keeping the light on in my house but what if it’s when I’m not home? How do I make sure that things are okay when I’m not home or my children are home and I’m not there, and so I think when you talked about these types of products you have to think about the solutions, and not the individual widget. So what is the solution that we’re solving for here?

Yeah.

And then you can make it much more of a personal type of buy and a personal type of experience with that product.

Absolutely, no, makes a lot of sense. That’s great. I know a lot of manufacturers struggle with that too, particularly, you’ve got OEM manufacturers that come and it’s like hey, like, it’s a widget, or they think it’s a widget, rather.

They think it is, right, but it’s much more to that, and I would argue, or kind of that takes us to how do you then also appeal to new talent to come into organizations like mine, where there’s so much, it’s so much sizzle and demand with some of these other high-tech companies and in the retail space, it can be challenging to bring talent over, but I think that goes back to you have to change a little bit the type of marketing that you’re doing, and show people that the value that you can bring in this space I think is incremental, versus the value that you can bring in maybe industries that have already kind of crossed that chasm of digital transformation.

Yeah, and that makes sense.

How many buzz words can I use in that one sentence?

You’re good, you’re good there. So if I understand what you’re saying correctly you’re saying as far as recruiting new talent, attracting them, by going more digital and having, specifically what is it, it’s interesting ’cause we’ve heard from a lot of people, I’ll give you an example. We had a client that their website had not been updated, I mean, very simple analogy here, but very outdated website, and I said you know, listen, we’ve got people, it was an engineering firm, these engineers are coming in and these guys have done everything, and they were awesome, but we were not able to get people to want to come work with us because our website, or if they finally did come and do an interview they looked around the office like oh, wow, this is like way different than we thought it would be, and then they get this new website and they’re like oh my gosh this is amazing. Is that part of what you’re talking about or other elements?

No, it’s about brand perception out there, and so for sure wherever, and I would say that this goes to the customer as well. Whatever that initial touchpoint is from your customer experience, that’s the impression that you leave, so bringing in younger talent or newer talent to the organization, and nine times out of ten they’re going to go to your website and check you out, and see what you’re all about, so you’ve got to make sure that that avenue to them is the message that you want to portray. Our customers are starting to do that as well, but maybe for them the first touchpoint is a trade show, or maybe for them the first touchpoint is one of these digital cul-de-sacs that we’re talking about. So what we’re starting to now kind of border on here where the conversation is going is making sure that that customer experience, no matter where they are, is consistent, and is obviously positive is what we want, but there’s also a big portion of what customer experience needs to focus on is also the consistency of message.

Yeah, absolutely, across all the channels as well.

Across all the channels, absolutely.

So to your point, yeah, you encounter with a brand at a trade show versus online, you’ve got to have that, I love it, that experience, because that’s really, in essence, a brand, I mean it’s what we perceive up here.

Yeah. Oftentimes I say to folks, what we’re talking about really isn’t rocket science. But in traditional manufacturers and in these industries, it can be challenging, just to get people there, just because it’s not the way that they’ve thought in the past and I think it goes back to the whole changing of the workforce as well.

Yeah. Yeah, absolutely. We had ADP on a couple weeks ago and we were talking all about that, and it’s a big thing. I mean, Google, golly this was a stat back in 2015 or 2014 saying that nearly 50% of B2B buyers were millennial. I think it was 49 at that point, and that was 2014 or 2015, so I think time has progressed a little bit since then and I suspect that number is going to go up.

Yes, I would say that.

I was okay at math in school. So anyways, well Monique, I’ve really enjoyed our conversation. We probably could go for hours more, because I could totally geek out on this stuff all day but is there any last parting words you have for our audience or any piece of advice for somebody that says you know what, we’re on the fence and, oh gosh, I would love to get this going in my organization. What would you tell them?

So here’s what I would say. In industrial environments and traditional manufacturing companies, it’s anywhere but up, or it’s only up, only up, and so there’s a lot of runway here, and I think any effort that you make you’re going to see improvement, you’re going to see a return, and so for me, that’s why I stay in these environments because there is such much opportunity to grow and to help, and to really change, so if you want to make an impact I fundamentally believe it’s these more traditional industrial environments where people should go. So I would say stick it out. It may not be fun at first or it may not be easy at first, but you will definitely make an impact, absolutely.

That’s awesome. I have one quick follow-up question.

Yes.

Do you have a favorite story or something when you said, you’re trying to implement this or maybe some changes that you were trying to bring to the table, and you were just really, just oh man, really struggling, but then finally had oh, we had that breakthrough moment or that aha moment. Maybe you’d share a story? Might not be there, but I’ve just–

Yeah, no no no, it’s a personal story and it’s a few years back, and I was leading a marketing team in Dallas, I was based in Dallas, and I was actually working in a financial services organization at the time, very traditional, right, very conservative, and I was struggling with trying to get a seat at the table with marketing and not have marketing always be, “Hey, can you make this brochure, can you go update this PowerPoint pitch,” or what have you, and we were a couple years into the development of this organization, working very very closely with the commercial leader, and there was a big leadership meeting, and I wasn’t there, but someone came knocking on the door and they said, “So-and-so says that we can’t start the meeting until you’re there, and he needs his marketing leader next to him at this,” and that, for me, was the moment of, “We have arrived,” at being a critical component to this leadership team, and from that moment on marketing was at the table, and so that was very, like I said, that’s very personal, and a very emotional experience but that meant a lot that that leader of that business could not conduct his strategic meeting on this very important topic without having his marketing leader there.

That’s huge.

That’s for me, that’s when I know it happened. Yeah.

Absolutely. I mean that’s awesome, that’s such a great story. How long? It sounds like you put a lot of blood, sweat and tears into that to make that happen. How long did that take?

It was about two years working in that organization before that moment happened.

Wow.

Many years into the career, but in that particular role or that business that I was with, that was about two years until we got there.

Well you know it just goes to the point that it’s not something that’s going to happen overnight, and you just have to I’d say continue to have hope, and have faith, and keep moving forward and just educate and do things, look for the quick wins but measurable things and to keep communicating that that you will make that impact, and that’s such an awesome story. I really thank you for sharing that.

Thank you for asking, yeah, tenacity and grit, right, tenacity and grit.

I’m reading a book about grit. Gosh, I can’t remember her name. Once I finish I’m going to plug that on the show. It’s awesome, but it’s talking about all those things and how much, it’s almost even more important than talent, saying if you have that determination and the perseverance, grit, just to keep pushing forward, so that’s awesome. So, we got to stay gritty on IndustrialSage here. That’s for all of our subscribers, you’ve got to stay gritty. Thank you so much for your time and spending that with us and just really sharing your experiences, and your stories, and advice and what you are doing with ABB. I think it’s awesome, it’s fantastic, and we just really appreciate it.

My pleasure. It’s been a joy this afternoon. Thanks for having me on. I appreciate it.

Well thanks for coming. All right, so okay, hey, wow, we just covered a whole lot of topics here on this episode with Monique, and just so many awesome things. A couple things, I think what my favorite part actually was really the story that we heard at the end, talking about the grit and that perseverance of rolling in with this digital solution, and it took two years of putting in the time, say I’m going to do this, and she got the seat at the table, and really making a positive impact in the organization, and that’s exactly what we’re seeing right now with manufacturing companies, with industrial companies. If you are there saying we need this and we have to bring this in, but getting this organizational buy-in is so difficult and so challenging, look, stay the course, keep going, keep doing these things, keep pushing forward because you and I know, we know, Monique knows this that this where we have to go. I mean, organizations that don’t make this transition and that don’t adapt, there’s company names that you don’t want to be associated with. Think of Netflix and Blockbuster. Think of what just happened with Toys R Us. Just not listening to the customer. I love that. So anyways, I’m going to stop rambling. There’s so many amazing elements here you need to, I’m just super thankful for this. It was awesome.

So thanks for listening. If you have any questions you’d like us to answer on the show, we’d love to do that. You can reach out to us, IndustrialSage.com/questions. If you’re listening on a podcast, ’cause we’re on all of them, we’re on Spotify, TuneIn, Stitcher, iTunes, everything there, we love a review. If you’re looking at our stuff on social media, please share, like, comment, all of the above, and last but not least if you’re not on the email list, you want to get on that. We got all kinds of great freebies, and resources, and tools and things that are going to help make you a sharper marketer and sales professional, as we tackle this big challenge of making that transition over from traditional over to digital marketing. I’m Danny Gonzales and thanks for watching IndustrialSage.

Thanks for reading. Don’t forget to subscribe to our weekly newsletter to get every new episode, blog article, and content offer sent directly to your inbox. You can also subscribe wherever you download podcasts so you can listen on the go!

All right, so let’s jump into today’s episode. Shonodeep, thank you so much for joining us today on IndustrialSage.

Danny, great to be here, good to be here.

Now we’re super excited. So we’ve got Shonodeep Modak, Chief Marketing Officer in North America for Schneider Electric. And so we just, again, really thank you so much for spending some time, I know you’re super busy to share some information and some insights with the IndustrialSage nation or our audience here. So before we jump into all the really cool fun techie stuff, for those who aren’t familiar with Schneider Electric, tell us, who is Schneider electric?

Yeah, Schneider Electric is a leader in industrial automation and energy management products. So much like, you think about your house, how there’s a load center, where you turn the circuit breakers on and off, that’s just the very basics of what Schneider Electric does, it goes all the way around smart manufacturing to building management and energy management systems, to newly announced joint ventures, with infrastructure companies. And so we span the space of buildings, data centers, infrastructure and industry and helping out those customers control, protect, and monetize a better experience for their customers.

Excellent. So that’s kind of a big deal. A lot of things going on in that digital transformation piece, talk about industrial automation, a lot of big buzz words, rightly so, a lot of transformation happening now in manufacturing. Maybe give me a little bit of your background, as Chief Marketing Officer, so second day on the job and market, you know.

Yeah, no, I’m officially a year in Schneider now, so loving it, it’s a great organization, lots of great leadership. My responsibility is essentially across North America, so Mexico, Canada, United States, and I’m essentially responsible for how we market to our customers and build a seamless experience to help customers understand awareness of our products, help challenge them and solve solutions for their biggest problems, and then work on the how do we keep them engaged through both the aftermarket and through this great service experience.

Big challenges that we can all focus on. I didn’t ask you this before, so let me throw a little curveball, but it should be an easy question, tell me a little about your marketing background, like how did you get into marketing, like, did you go to school for it, or well, do you have a different background, just curious.

Yeah, no, good curveball. Interesting story there. So I mean, I’m an engineer, I’m a chemical engineer. You may not tell by my deep southern drawl, but while I’m a resident of Atlanta, I actually grew up in Mississippi, so I went to Mississippi State University, and while I was there in my internship in my last year, I did a fantastic internship with a power generation manufacturer, and got to go crawl around boilers and nuclear power plants and cell service solutions. And I said, “You know what, this is much more exciting “than being in a plant “and potentially blowing it up with my engineering skills.” So I said, I’m probably better off, and I actually enjoy the value sale, and how you define what makes your product make either intrinsic or economic sense for the customer and benefits. And so that got me into marketing and sales.

My first job, when I left, was I joined a big oil and gas company, and I did sales for about three years, crawling around more boilers, making recommendations in the industrial customers, and based on all this great data that we were finding. And from there, I moved into a finance role, and then finally into a marketing role for the Consumer Products Division in the oil and gas company. And I had some of the best times of my career figuring out how to position products on the shelf of big retailers and make sure that we optimize the product mix, and we introduced a lot of cool new products too. And that got my passion for marketing. And I ended up going to school at George Washington University, and did marketing there and got my MBA, and then left and joined another industrial manufacturing company, and then Schneider Electric about 10 years later. So lots of different marketing experiences, but all B2B, and be some B2C, but all B2B, and all in the industrial side.

That’s awesome, that’s a great story. Sometimes I like asking that question just to see like, hey, ’cause I always find it fascinating that people actually went to school for marketing, or they started totally different, and you kind of started totally different. It’s interesting, you see a lot of crossover from engineering Product Manager, whatever, into sales and marketing, that kind of role, but sounds like that you got plucked early.

Yeah, I found my way, I think, just being able to be involved in the customer experience, I think is kind of the common thread. The other thing I’ll just point out to you is that I’ve kind of, it’s a little bit of some introspective analysis on my career is that every product I’ve been involved in, be it in terms of marketing motor oil, or marketing hydraulic industrial fluids, or if it’s been power generation plants, and now even at Schneider Electric, with energy management and industrial solution, IoT, it’s all what I call ghost brands, meaning that you can’t touch, feel, taste the products like a power plant, you can’t feel the electricity, you can see the see the light, but can’t tell the difference of one versus another, motor oil when you put that in your car, you can’t tell, and now even with a lot of energy management systems, the fact that they’re working, you never know.

You can’t tell until they’re not working.

Until not working.

It is a big problem.

And so I coined the term ghost brands, and that’s something that I feel like requires a different way of looking at things, and different way of marketing, and that’s where I feel like I’ve been able to add a lot of value in these companies and make what’s intangible, tangible, and the IoT transformation, it makes it dynamic in a whole new way, digitization in marketing changes that for us, where in the past, you were selling on a lot of great PowerPoints and great collateral, now we have something we can really bring to the customer.

Now that’s awesome, I love that. So, ghost products?

Ghost brands.

Ghost brands, ghost brands.

Ghost brands, yeah.

Yeah, it totally makes sense because it’s very hard to sell a blank canvas or something that you can’t touch and feel, so that might be another episode, might have to jump into, because that’s a huge challenge, but I think, speaking of challenges, I think it’s a really good segue into talking about kind of what I wanted to address in this episode a bit more is today’s challenge for the CMO, and just really just marketing in general, there’s a lot of great tools, there’s a lot of transformation happening right now, but that’s creating a lot of other challenges. So maybe you could speak to it, what is the number one challenge, in your mind, for today’s CMO?

Yeah, and I’ll partition that in today’s CMO, industrial B2B CMO, just because I know that’s a lot of the folks here listening in. And I would say that, especially in industries, where you do sell through a channel, the biggest challenge is to be able to continue that engagement when you’re two degrees away, and you’re separated from that customer experience. And so at the transactional level, the transaction is between your channel partner and the customer, the end user or the intermediary, and that disconnect is probably the biggest challenge that we have. I think in Schneider Electric, we have a huge percentage of our business that we call goes through the channels and also goes through diffuse customers who are too small to even really have that one-to-one relationship. And it’s obviously a big challenge that B2C has been having for a while, but it’s easier, I feel, not not to offend my B2C comrades, I think it’s easier to be able to have that relationship, especially, when you’re going through retail or normal channels.

Sure, I mean, looking at attribution models and things can be a little bit easier if you can have the whole life cycle of the sale.

The whole view.

From beginning to end.

You got it.

Certainly a big challenge. Yeah, you answered one of my other questions is, unlike most manufacturers, it looks like most of your sale is driven through distribution channel partners. So do you do any direct type of work, or something?

We do, on some big projects, we’ll go to direct on but our preferred channel is go through partners, and they have the best path to market. In many cases, they’re influencing a lot of the projects, too, so we prefer to choose the partner route.

Right. Yeah, no, and this is such a big challenge for everybody, is that you have, essentially, like those two kind of audiences, you’ve got where A, selling to the channel partners to make sure, “Hey, like we’re going to help make you guys “look great, and we can help roll out “your totally different message,” versus then selling to the end user, but kind of having the, you know, like, “Hey,” we don’t have as much connection to them. So that makes a little bit more difficult. How are you addressing this?

Yeah. There’s a few things that we’re trying to do. One is, I guess, I would say, maybe I can summarize it in three things, number one is, while we lose the visibility in the transaction side today, we do have visibility on the, call it, the initial search and the initial kind of, call it, solution-seeking that you hear all these stats about most B2B companies make their decisions, well ahead of on the digital space, right? So we have that responsibility, I feel, to be able to help navigate customers into understanding where we can help with the right solutions, giving them education and thought leadership. Example is, as people come into our website, we’re looking at their IP addresses and their cookies and really understanding where they’re coming in and looking at the paths that they’re coming into.

The number two thing is that also along that kind of informational journey that these customers are going on, we also are establishing we’re changing the way we interact with them. So we’re no longer going from big Schneider corporate Schneider Electric corporate to, call it, a vast space of all these customers, we’re going from one-to-one, basically, our inside sales, or our individual, call it, customer service agents, directly into those customers so they feel like they have this one-to-one relationship. We’re leveraging marketing automation technology, but there’s still very much a personal touch. And so that’s another way that we’re trying to bridge that gap I talked about. The third way is actually eliminating that gap. And so we are working with our partners on establishing point of sale satellite data analytics platforms that will allow us to collaborate with these channel partners to look at exactly, here’s the people that we made awareness of and then let’s actually look at the transaction and then look at just the traditional what should they have bought, what could they have bought, and then where are they now few years into the sale and the install base, and how are they using it and how can we be able to help them further?

So you’re measuring things like touch points, just all the way from the journey from, “Hey, we generated this lead through X, “and then we processed and followed them through here “and then we handed over the lead to you guys. “Okay, here you guys go, like make this happen, “and hopefully we see a sale on the back end.”

That’s right. And before, we didn’t have that visibility and now we’re slowly kind of going through the fog here and parting ways so we can see through that?

How did you get that visibility, what was that main catalyst?

A lot of the main catalyst is technology and having those access to all these new, call it, account based marketing platforms, having access to marketing automation platforms, and having access to sell-out data, data lakes that we are able to use in the what was the future is here now.

Okay, that makes sense. Yeah, account-based marketing, big thing. Actually, we have an episode we’re going to be recording. Hey, after yours, we’re going to talk to Terminus actually about–

Oh, yeah. I’ve got good friends there.

Yep, we have Sangram Vajre.

Sangram Vajre, yeah.

He’s going to come on.

Cool.

Talk all about that, which is super exciting. I love, not to gush all about their platform and everything, but I just love all the great cool toys and stuff, which you can do with it.

Well, he’s got tremendous energy, so the audience is going to love him, yeah.

Get ready, we’re ready. Well, on that note, you mentioned you’re using some of these different platforms, is there a particular like critical martech stack that you use, I mean, as far as like the backbone? I know there’s no lack of marketing technology out there, but have you found the kind of the backbone? What have you found that’s helpful?

Yeah, I think part of it is. A lot of the technologies work in the core fundamentals in a similar way, the experience may be very different in terms of the usability, but making sure that you have a CRM system that talks to your marketing automation system, you have an account-based marketing platform that also talks into the CRM, and then finally, that you have the ability to enter your CRM, plug in your, in this case your satellite data, or all your data analytics sort of tools that can help you synthesize and analyze things. And I think for us, in Schneider Electric, we have a customer analytics team that’s been fantastic, that’s helped us kind of think through and look at these pieces and how they work together. Change management, the biggest challenge that I think lot of us face when it comes to onboarding these platforms, ’cause not a lot of the platform providers, I would say, no offense to a lot of you, have a great change management process. And I think that’s something that we’ve got to work towards.

Yeah, it’s super difficult, and there’s a lot of reasons for that, you’ve got I think a lot of people that are just generally resistance to change, there’s a lot of fear, there’s a lot of resistance to change for many reasons, I’m either afraid of it, or I don’t want to mess with it, or I’m worried that I’m going to lose my job. So what have you seen that has been successful in terms of deploying? So, as you said, you didn’t have this visibility before, and now you guys are kind of like going through, cutting through fog a little bit, what were you guys able to do or how are you guys managing that?

I wish I could take credit for a lot of it, well, since I’ve been here only for a year, but I think the methodical approach that we’ve taken has made it successful, meaning that we never turn on everything all at once, we start either in a geography or in a sub geography, and we trial and test it out, and then we start to scale. Especially when you go from country to country, and you have different languages, et cetera, right, that is a big problem. But that kind of testing and phasing in, is what’s been working. And we’ve partnered very closely with our Schneider Digital, which is our information technology side, and as they’ve been really helpful at coordinating the platform developments and establishment with us. In my team, I have a Digital Customer Experience team that’s responsible for the implementation of those platforms. And so that makes it also successful too, is by having a focus dedicated team versus somebody that kind of has to live with it, but then doesn’t necessarily have the chance of, call it, onboarding.

Yeah, no, that totally makes sense. Yeah, we see that a lot. Yeah, what we also see a lot is flip side. So not taking like little chunks, like, hey, we’re just going to focus on this group with this geography or this department, or what have you, it’s we’re doing everything, we’re going now hoo ah, again, then it’s like, oh, my gosh, and then you come to realize, man, big thing, we really liked process, we didn’t know that. We though that buying Salesforce was going to, not to throw shade on Salesforce, actually, this week’s episode is on top CRMs, so anyways, that’s neither here nor there. These are all great platforms, but if you don’t have the framework behind them, man.

You got it, you got it. You mentioned Salesforce, we’re one of the biggest Salesforce users, and so for us, it’s really important that we look at those processes. And now some of the things I’m doing with my team is we’re going through a massive transformation where we’re reorganizing, re-architecting from product focus to customer segment focus, customer segment orientation, and along with that, that incorporates and entails the integration of the portfolio products into a customer segment, but along with that, it’s about now how do we develop processes because now we’re changing things around that allow us to make that we’re using CRM consistently, using marketing automation consistently, and that’s going to be a big phase for us in the next few months.

No, it’s great. I mean, here’s the thing, you were talking about rolling out with Salesforce, and you guys being a big users, I think it’s super needed, and it’s really important, once you get to a certain phase, but going from like over here to, like from zero to 60, like that is like, okay. ‘Cause I think what you guys do is great, just get those wins, build that in there. ‘Cause I would imagine, from a change management perspective is that when you have a more focused group, that maybe just communicating and internalizing those wins, like, “Oh, my gosh, look at this, “this helped us do this. “We have visibility now, this is amazing,” and the internal cheerleader is like, “Oh, yeah, this is awesome, “this has made my life a million times easier,” or what have you, then that’s how you’re going to win fans and scale, right?

Absolutely, and just to add to your comment, I mean, we found the success points, like remember, the change we’ve made around using our inside sales team and our customer service team, to multiply, force multiply, their one-on-one interactions by using marketing automation technology, has turned these teams into true fans of marketing. Before they may have been like, “Yeah, that’s great content, how do I use it?” Now we’re involved in the use of it. And so we’ve developed nurture paths, say, call it, steps of five emails, where we’ll go through with the inside sales team, and then we’ll actually do boosting, we’ll do paid boosting after that, to then re-engage those customers who maybe didn’t open it. But we’re seeing open rates, call it, five times higher than what we would have if we were just doing big Schneider corporate emails. So it’s changed things.

It’s going to be more tailored, I imagine.

Yes.

All right. So for those in our audience that are, “Okay, nurturing and whatnot, all this stuff,” like, sometimes, we can throw up big terms and whatever, but really, at the end of the day, I mean, I think one of the really exciting things, this is a conversation that I had with one of our clients before, we were talking about trade shows, “Hey, listen, how many follow-ups do you have?” Let’s just take this real simple, right? “Okay, well, you we met all these people at a trade show,” or, “we have this list of people that we’re working.” Said, “Okay, well, “we can create an automated email sequence. “So instead of you sending an email to 50 people, “like one by one, let me send to this person, “now let’s send it to this, “I mean, how long is that going to take? “So imagine doing that like that?”

And I think the awesome thing is that where you guys have it right, is that a lot of times we have this major disconnect between sales and marketing. So sales is on this part of the building, marketing is way over here, and both are like, “Oh these guys, I can’t believe,” like, “why did marketing make this? “What the heck do they know?” And sales like, “They don’t even use anything that we made.” And I think by walking in and getting an understanding of like, what they need, and saying, “Hey, this is how it’s going to help you guys,” and then, “let me show you these couple of things.” Like, “Oh, wow, “you mean I can like increase my productivity like big time, “you mean I can have more interactions with customers “in a shorter amount of time? “Wow, that’s amazing, that’s super exciting,” so.

And I’ll just say maybe another helpful hint for the audience would be as you assess that with your different sales organizations, there are some that are much more transactional, that don’t have the time to be a hunter, per se, so what we found is that that type of, so I’ll call it lead-gen trends, coordination, opportunity management, doesn’t necessarily work as effectively. But when the primary goal, like inside sales, or our customer service team, is meant to look for those opportunities, and seek out that value add that they can provide and go after that diffuse market that the guys that are going after the big projects would never have a chance of shooting at, this is a way for these teams to be successful. And I think starting, and maybe it’s smaller dollars, but you can make a big name in marketing, or make a big mark in marketing when you focus in those areas.

Absolutely. And you have the whole land and expand opportunities there.

That’s right.

So, that’s awesome.

We’re trying to still figure out how to do this with our channel partners, and force multiply with their sales force, who, in many cases, is more opportunistic, but I look forward to your next episode to learn more.

Learn all about the secrets, yeah, absolutely. So one other thing I wanted to talk about a little bit was, from as far as another challenge, I would imagine from a marketing standpoint, is that now we have all this great marketing technology, and it’s awesome. There’s a key thing you said earlier, you had a great partner as far as your data and analytics, is now that we’re generating all this activity, we’re generating all this data, we’re generating all this analytics, and we’ve got ABM platforms, we’ve got CRM, we have marketing automation, and who knows how many other technologies we’ve got, pouring into marketing automation, is having that visibility and taking all of this structured or unstructured data, and making what’s what of it, is that a challenge for you guys?

It is, because I say, firstly, it’s so easy to get distracted by the next shiny thing. So the next sales person that emails me and says, “Hey, we’ve got this great new platform for your content, “or this great new thing,” and it’s so easy to get distracted, but we are trying to stay ultra-focused, I mentioned the transformation that we’re going through right now, what I’ve done is I’ve said, “All right, “we need to make sure that in every key area, “be it lead-gen or be it social media, “we need to make sure we have listing analytics, “we need to make sure we have lead-gen “and performance analytics. “For our campaigns, we need to make sure “that we have analytics on the ROI for campaigns.” So part of the redeployment has been to make sure that we have analysts that we’re positioning across the different touch points, or the different areas of marketing, because the worst thing that we can do is move on to the next thing without learning it, or go after the next shiny thing without learning. So that’s a big investment that we’re making in our team.

Yeah, no, that’s great, totally makes all the sense in the world to me. So well, Shonodeep, I’ve really enjoyed our conversation. I feel like we go like hours more.

Thank you for the opportunity, Danny, I really, really appreciate it.

Any parting words you would have for our audience who are maybe facing or struggling with this challenge?

Yeah, no, I think that I’d love to have the dialogue with a lot of the folks here in the audience on their challenges and how they’re solving for it. In Schneider Electric, we have a large marketing organization that’s doing some amazing things in different spaces, and I hope we get a chance to maybe, in the future episodes, have a chance to bring in more of the team.

Absolutely, yeah.

And showcase more of the great learnings that we have.

That’d be awesome. Well, Shonodeep, again, thanks so much. We really, really appreciate all your insights, super valuable to our audience. And I’ve learned a lot too, so thank you.

Thanks again for the time, Danny.

Anytime. All right, well, there you go, there you have it. Listen, some great stuff, we have some recurring themes here. The big challenge, right, is, and I know everyone can, almost everybody can relate to this, if not 100% of you, is that we’ve got essentially these two audiences, how do we get that visibility in from working with channel partners, or distributors, or what have you, or even independent sales reps, all the way down to the end user? And digital has a really great way, a great opportunity, to be able to get that visibility. If you’re thinking about that whole marketing automation, CRM integration, that kind of PC, you can start doing that but don’t do it super fast, we talk about this all the time, take that segment, take that small test group and just kind of, as one of our previous guests said, nail it and then scale it. So, Malika said that, Malika, I’m stealing it, but I’m crediting it to you, nail it and scale it.

So anyways, listen, this is it for today’s episode. If you have any other questions, we’d love to answer them for you. You can reach out to industrialsage.com/questions. If you’re listening on any of the podcasting apps, we would love a review, if you’re on social media, please share stuff, we’d love it, and last but not least, if you’re not on our email list, you need to go to industrialsage.com, get on there ’cause there’s a lot of great content that you’re not hearing or seeing, if you’re watching this on social media, or listening on iTunes, that a lot of stuff is coming down the pipe through your email that you don’t want to miss. So go to there, sign up, and you can take a look at all the really cool things there, and I will check you later, check you out next time, next week. I’m Danny, thanks for watching.

Thanks for reading. Don’t forget to subscribe to our weekly newsletter to get every new episode, blog article, and content offer sent directly to your inbox. You can also subscribe wherever you download podcasts so you can listen on the go!

All right so let’s jump into today’s episode. I have Kelly Costello who is the owner and founder of PuppyCake. Kelly?

Hi, I’m so happy to be here. I love talking about business, love talking about manufacturing so happy to share some of my stories with you.

Well I’m excited to jump into this. So, all right, like we were talking about a little bit before we kind of kicked off is that, you know, there’s a lot, like your business, well first of all, you know, it’s kind of a little bit of a different area than we might typically have on IndustrialSage, which typically we’re talking to a lot of B2B manufacturers, or, so it could be manufacturers, or material handling, and so you guys are a little different, but like a good different. I’m excited about it because you guys have a very interesting fascinating story that I want to dive into. So, before we get into all of that, if you just tell me from a high level, like okay PuppyCake, what do you guys do?

So PuppyCake makes, manufacturers, and sells cake mix and ice cream mix for dogs.

All right.

We sell a ton on Amazon and a lot of our business is actually business-to-business, we sell to a lot of independent pet stores and a couple of larger stores as well.

Okay, that’s awesome. So, I really want to get into your story, I’m super excited. So I don’t mean to, there was like, Shark Tank‘s involved with this and we’re talking about how the business has been around since, you know, before the Great Recession and that was all fun and all kinds of things in-between then there. So, tell me, take me back to the beginning. Why, you know, how did PuppyCake start?

So I used to work for a sales and marketing firm and one of my clients was Pillsbury.

Okay.

And so I was looking at their old cake mix ads and I thought, oh wouldn’t that be great if they made that for dogs and then I thought, I could do that. So I started researching it, there wasn’t anything on the market for it and I created some recipes, did a bunch of testing, and after a couple of months launched it. So I was 21 when I came up with the idea and then I turned 22 shortly after that and so I launched it officially on the market in November of 2007. So we got started, I was bright-eyed, young and bushy-tailed and thought that having come from the consumer packaged good background with working for larger companies like Pillsbury and Smucker’s I really ambitiously thought that I would be pacing to a million dollars by the end of my first year and I was so wrong.

One of the biggest challenges that I faced is after I launched it the recession started to hit and after the bailout banks weren’t lending money anymore so even at 22 the amount of credit that was extended to me was kind of unreal, today it’s not happening. But I had like one line of credit that was like $15,000 and I had a $7800 balance on it. After the recession they reduced my line of credit to only $8,000 so I had $200 over what I owed and essentially I had no money to be able to run my business. So I learned some really tough lessons, had to kind of restructure and focus on more grass-root sales because that’s the only thing that I could afford was me making phone calls because I just had no money to grow the business.

And the first couple years were really tough, and like you mentioned, I got on Shark Tank in 2012. So after a couple years of struggling a producer found my products and sent me an email and asked me if I’d be willing to audition. So in 2011 I filmed for Shark Tank and then in February 2012 it aired and after that I mean it really set up my business for success. I got some great advice from the sharks, I did not get a deal, I mean my numbers were pitiful. What I said that we made annually, whenever I filmed, we do in less than a week now.

Wow.

So that is the difference of the level that I was at when I filmed for Shark Tank to where we are here in February of 2020 eight years after my episode aired.

That’s awesome, so all right, actually I’m curious about the Shark Tank experience. What I’ve heard is that it’s, and I’m sure you can tell us your experience on there, I’m just curious. I’ve heard that it’s like, it’s a much longer pitch and then it’s edited way down so it’s an actual more like a traditional pitch and I think I’ve heard that it’s like an hour long or so, but then they obviously, they cut it way down. What was, is that kind of how it runs?

Yeah–

Okay.

You’re right, I was in there for probably 45 minutes or so. They ask great questions and I was really prepared for it but I knew that my answers weren’t going to be great, but that’s part of why I got aired, because not everyone that films actually airs.

Right yeah.

So, I was very honest and very candid about the mistakes that I had made, some of the issues that I’ve had, my own personal shortcomings that, you know, one of the reasons we had struggled for so long is that sales wasn’t really one of my strengths. Like the, you know, face-to-face sales and cold-calling was a real thing that I didn’t find pleasant at all. So Mark Cuban called me a, wanttopreneur, and I mean at the time he was kind of right–

Ouch.

You know.

Yeah.

Yeah, they definitely lit a fire under my butt to really take my business to the next level and make, like look hard at my business. It kind of made me ask the question, well, if you had a pile of cash would you buy your own business, like is it, are you going to get your money back? And at the time like the answer was no and that’s why I didn’t get a deal. But it was a great experience and I am so thankful that I got to do it and the publicity’s been awesome since then.

Well it sounds like it’s been amazing. So what we’re, I mean, you go through that experience and you know Mark Cuban calls you a wanttopreneur which, ouch, right, I get that. But, I mean you took that and said screw that and I’m going to make a go at it, what were those key changes that you made?

So one of the pieces of advice that Lori gave me, she said, “I think you have a good product, but you don’t really have a business.” She suggested that I create more products and do, so I can have a line of products and her advice was very sage, you know, too, pun intended. Because when I started getting into the industry more deeply by going to trade shows, and that’s our biggest expenditure marketing-wise is going to trade shows, is that I heard the same thing. Distributors were saying we want to see a line of products we don’t want to just take on two products, or one, five different flavors of one product because it takes a lot of work to set up a product and also start working with a brand that they want to have an arsenal of products that they can, they can sell to their customers. So that was one of the things I started doing.

I launched a couple of things that were okay, not great, I launched Puptato Chips which was a dehydrated sweet potato treat which I discontinued after a couple years when a few other products really surpassed it in sales. I did a cookie mix which I thought would be a slam dunk, but it wasn’t. People are completely content with buying biscuits. They like buying the cake mix because they want a soft cake, but they’re perfectly content with hard cookies from the pet store which is an interesting lesson to learn. But the thing that really turned my business around was I thought, ah, you know I need something for the summertime because people don’t bake as much in the summer, it’s hot, you don’t want to turn your oven on, you’re already 78, 80 degrees in your house and you’re going to turn the oven on. So I was like I need something for the summertime that is going to supplement the sales that I’m missing from the cake mix because at the time the cake mix was my best-selling product. And I was like, well you know I already work with yogurt powder. I wonder if there is a high-fat milk powder that I could use and make an ice cream mix?

And I kind of just didn’t think it was going to be, you know, that popular, but I launched one product, it started selling like crazy, I launched three more flavors of it we got first place at the New Product Showcase, actually it might’ve been second place, I hope I didn’t misspeak, but in the New Products Showcase at Global Pet Expo, because it was so popular, and what I learned was that retailers don’t have much freezer space, if they have any at all, it’s also a logistical nightmare to ship frozen food, I’m sure you’ve had plenty of companies that deal with that as well. So offering an ice cream mix solved several problems and allowed lots of retailers, like independent pet stores that you would see like mom-and-pop type stores, allowed them to carry an ice cream for dogs and overnight doubled the business.

Wow, overnight, wow.

And so, yeah, I mean it was just like a huge edition to our company. Our cake mixes really served that answer to, “I want a cake for my dog,” but the ice cream mix is like all year round as people are buying it as a treat for their dog.

That’s awesome.

So it has a really high sale-through rate, we’ve launched more flavors. I’m actually launching a new line of ice cream mix to complement our current line of Puppy Scoops. So that was, that piece of advice that I got from Shark Tank that I needed to have a line of products resulted in making my business explode. So in 2015 is when I launched all four flavors and it really turned everything around since then.

That’s awesome, you know, so that’s a, that’s a long run to go from 2007, launching 2007, and then 2015 that’s when it really made it, it’s interesting, so I started my first business in 2007 actually so and I was in, and I still have it so I’m still running it, but it’s, that, it’s a long run, you’re playing the long game. What kept you motivated and what pushed you through, there’s, I know there’s tons of ups and downs. I know that when your line of credit gets cut like that, and you’re like, crap, I owe more now than what the actual, like my balance is higher than what the actual limit is because they just came in and did this. What kept you, what kept pushing you through?

Oh a lot of things did. I think part of it was like my gut saying that I had a good company and that if I stuck with it I could, you know it’s like little things, good things kept happening to encourage me to keep at it. And because it continued to grow, I mean it wasn’t profitable, but it continued to grow and so I thought, and I wasn’t doing it full-time, I was doing it part-time, I mean partly out of necessity just because it wasn’t making me any money for the longest time. But I aired in 2012 and then we launched the ice cream mix, or sorry, before we launched the ice cream mix in 2013 I got this really really big order with BarkBox, it’s a subscription box that’s probably the most popular dog products subscription box in the United States. They placed an order for like 40,000 units of my Puptato Chips–

Wow.

And I had to do my business full-time and so then once I was literally hungry because I was completely relying on my business to feed me, and put gas in my car, that was the push that I needed to be creative, be innovative and figure out how I could take my company to a profitable level where it would be worth it for me. And like one of the interesting things that surprised me after all these years of doing it, is that we didn’t really get profitable until we hit a million dollars, which I always thought like, oh once I hit 500,000 in sales I’m going to be just living high on the hog–

Yeah.

And it’s just, in manufacturing economies and scale really do make sense and it wasn’t until we could buy bigger, better equipment that now when we make more products it’s just so much more profitable and that one million dollars was kind of like our break-even point almost.

Yeah.

We hit that then things really took off.

Yeah, that’s awesome. So let’s talk about the manufacturing a little bit in this space. So, traditionally, I mean typically, I mean we’d work with, especially at the on-set, a co-packer or, you’re developing something there. You mentioned that you, earlier, that you are currently manufacturing stuff so you’re not outsourcing that, that is you have a manufacturing facility where you’re doing that?

We have, I’ve always manufactured PuppyCake stuff. I would’ve loved to have had a co-packer, but the minimums were so high. Like a minimum for one flavor was like 10,000 units and then the cost just to have them do it was 25 cents per unit whereas it was costing me like five cents to make a bag of our yogurt icing.

Right.

And so it just never made sense. I knew that if I hired a co-packer I would pay a lot of money out-of-pocket and then I would have product that would expire because I didn’t hit, I didn’t have enough orders to justify a 10,000 unit minimum.

Yeah.

So that’s why we always manufactured. The interesting thing about doing powders is that you don’t really need a lot of equipment to put powder in a bag, mix it up and put it in a bag. I mean I started with–

Yeah.

A KitchenAid mixer and an Impulse Heat Sealer which then I upgraded to a Continuous Band Sealer thinking I was like, you know–

I am it.

Pretty hot, yeah.

That’s awesome.

It was like where have you been all my life? And then just like little bit by little bit went from literally taking a scoop that I had cut so it was the right volume every time you scooped it and scraped it, to a laboratory filler from Logical Machines up in Vermont, which wasn’t, isn’t great for powders, but it was good enough for us because it causes a lot of dust because you’re vibrating the powder. And then my now husband, he was my boyfriend at the time, is a mechanical genius, he always blushes whenever I say that but he really is, I found this really cheap Form and Fill machine in 2016 and it was cheap because the company that made it said that they would not service it and so I was able to strike up a really good deal for this Form and Fill machine knowing that my husband could fix it for me. And he did have to fix it several times. But we used that Chinese-made Form and Fill machine for a while. We would literally walk upstairs and dump buckets into the top of the funnel. And then last year we upgraded to buying a brand new mass-ee pack machine and my husband, again, took a flexible screw conveyor and created the brain for it so it would communicate with the Form and Fill machine and now we’ve got a really sweet system where we can do thousands of bags an hour where we were doing 300 an hour at best.

That’s awesome.

So I’ve always done it myself just because it made sense for us from a profit standpoint and also from just like numbers, now we could afford a co-packer but don’t need it because we’ve got the facility.

Yeah, keep those margins. So what, all right, did you have, I guess you did this yourself, but you know you get to a certain point, you said you started with a KitchenAid mixer and, okay that’s one thing right, and then I guess it’s just the next thing, it’s like well we need to scale a little bit, so did you have experience with any of these other machinery’s, how did you, what did you do to go learn to say, hey, I need something bigger but I don’t know what that is, or how did you do that?

I kind of of joke that… I joke that my nickname here at work is Jerry, because I jerry-rig a lot of stuff. When I was deciding on what my major was going to be in college it was between business and engineering.

Okay.

And I decided to do business instead. So I have more of a mechanical brain that whenever I see videos I start, I start thinking like, well okay, so this is what I’m trying to do is there something already on the market that I could buy and sort of jerry-rig it to do what we need to do? We just, just natural progression of researching the, the Form and Fill machine I actually found when I was on YouTube for something else and it was an advertisement that popped up, or it was like the next video, oh suggested next video, and I was like, oh man, wouldn’t that be nice to have a vertical Form Fill machine, it’ll make the bags for it oh I was like drooling over it and then I clicked on the link and went, oh, it’s actually for sale and it’s not that expensive. And so I was able to get an equipment loan because we had enough sales at the time to justify getting an equipment loan. Which I have learned that equipment loans are a lot easier to get than like a line of credit. So for other companies that other people are looking to upgrade.

So largely just because it’s collateral-based versus in factoring or something like that?

Yes, it’s like collateral-based so they can always take it back and usually get some of their money back almost, or all of it.

That makes sense.

So between myself and my husband we were able to come up with the next step. And I’ve gone to trade shows like a bulk powder show where you can really see like, well how are other companies moving powder? Because powder is a little bit challenging, it just, it’s kind of corrosive, gets everywhere and it’s a little fickle because every powder is a little bit different. Some are really free-flowing and others are like cornstarch and they kind of keep their shape however you put them. So between just being in the industry for a long time and sort of having an engineering brain that tells me to figure out what our next steps would be.

That’s interesting, okay, but all right, so cake mix is one thing, you mentioned, well obviously the ice cream thing was kind of big, was a big piece, so that’s, I mean, yes, from a mix standpoint I get, but you still have to like test out how to actually make it and that’s kind of a different thing. And then you also mentioned chips, you mentioned you were doing some sort of like, you call it Puppy Chip, or maybe that’s now?

Potato, Puptato Chips.

Pup, okay yeah, Puptato Chips, like that’s different, a different process there. So you’re just, you’re jerry-rigging it?

Yeah–

No.

I ended up discontinuing–

Okay.

The Puptato Chips because I realized that what I could do in 10-man hours on the ice cream mix, and what that value would be versus 10-man hours with Puptato Chips I mean it was like–

That makes sense.

The difference of like $500 and like $5,000 for the ice cream mix. So from a profit standpoint it didn’t make sense for us to do something that was really not our core competency. It ended up being for us that powders are our core competency and that’s all we do is just powder.

That’s very cool. No it’s a super interesting story. I mean I love the hustle, I love the drive, I love the ingenuity, hey I’m going to figure this out. I think that’s super fascinating and obviously there’s a huge drive, push, because otherwise there wouldn’t, you wouldn’t be able to, there’s just no way, there’s no way. So let’s talk a little bit about some of the, a big big topic in the industry is this digital transformation piece. A lot of manufacturers are struggling and realize, hey we need to, we need to bring in more digital solutions, and we need to throw away the paper process and we need to look… get things a little bit faster because the world is demanding it. The world that we live in, I call it the Amazonification, call it just business in general, we need things better, faster, cheaper, that’s always the push. How have you managed to kind of embrace that in your business?

So from the internal-manufacturing standpoint one of the big things that we’ve added, and I luckily stumbled upon this, was Katana MRP which is a cloud-based manufacturing resource planning software and for us, to dumb it down, it basically, it tells me if I make 3,000 packages of peanut butter cake mix on Tuesday, 5,000 bags of banana cake mix on Wednesday, will I have enough resources to make 3,000 pumpkin cake mix on Thursday and if I don’t when will I have it and do I have enough man hours for it? I have this many employees, they work this many hours, what day will we be able to complete all of this?

And before we found that I had a person who I was paying quite a bit of money and was just using spreadsheets and every time we’d get a change, which we’re a smaller company and one of our benefits is that we can move on a dime, is we get a big order for 3500 boxes of cake mix, you want to say yes to it. So every time that would happen you’d have to sit down at the spreadsheet, go back and count all the boxes, do we actually have enough because we don’t have a central inventory system for these components, maybe the finished product, but not the components, or the parts, or the raw materials. And that person would spend 30 hours a week just calculating whether or not we had enough resources–

Wow, yeah.

From time to material to complete what we needed and it was very archaic. So when I found Katana it saved me tens of thousands of dollars in no longer having to have someone do all that manual calculation. I use it, I’m a big champion for it, I don’t get paid for it, but I love Katana, it’s a start-up and it’s been an awesome company. It’s fun to watch them grow and add more features for us. But that was like a big thing for us to upgrade to more of a digital cloud-based software so that even when I’m traveling for business I know what’s going on in the warehouse, I know how much inventory we have. From like a sales point of view we are, we’ve really embraced Amazon. We sell a ton of product on Amazon. For a while PuppyCake was the number one selling cake mix for everybody–

Really!

People and dogs.

Wow.

And somehow it was beating out Duncan Hines until someone figured it out and re-categorized it, but we were number one for a while, several months. So we sell a lot of our products on Amazon. We actually sell them for higher than MSRP on Amazon which helps protect our independent retailers. They love it when someone goes into their store, pulls out their phone and checks to see, “Can I get this cheaper on Amazon?” and they see that they can’t, so then they buy it in the store. So it’s really a win-win for us.

Oh they must love that.

And our retailer.

Yeah.

Yeah, so we sell a lot on Amazon, we sell a little bit on our website and then we also sell to independent retailers which are our primary customers and really how we grew the business. Amazon from the, for us, why we were able to be so successful was that when you, when someone Googles, dog birthday cake, we’re the answer. And so I tell other businesses you want to be the answer to something. If you can be the answer to a Google search you will make money.

Yeah.

You know no one really… we’re growing our brand, but we’re still a very young brand and we don’t have great market penetration yet, but we are an answer to that solution and that’s a big reason why we’ve been able to grow so much.

I love that quote. I’m going to use that, again, I’m writing it down, “If you can be an answer to a Google search, you will make money.” I like that, no I love it because it, I mean it, but that’s where we’re at, right, I mean, forget the yellow pages, we’re not looking up for, that’s gone. Unfortunately a lot of people still operate that way, but that’s not the case that’s not where we’re going and it’s super, I don’t know, I just really like your story. I like how you’re embracing this technology is how you’re just making stuff happen.

Yeah so one of the things that I’ve kind of lamented throughout my career in manufacturing is you know why did I pick something so hard, like why I do powders? Like they’re hard to work with, they’re messy, you get dirty. Like when I was on Shark Tank and I’m like how am I going to bake these cakes in a hotel room like why didn’t I just pick a hard good, like something plastic I can get made in China. But I realized over the years is that choosing the path that is harder is usually the path to success. So don’t be afraid to do something hard because if it’s hard that means other people aren’t doing it and that ultimately is going to lead to your success.

Oh, that’s awesome, I love that. No, you’re 100% right, you’re 100% right. And even anything that’s worth it in life is tough, it’s hard, you know I like the, I’ve been preaching this. You know the T-shirts and the memes, oh the struggle is real, or whatever, I’m like okay, yeah it’s funny right the struggle is real, but I want to make a T-shirt, but N Necessary.

Yeah.

Because there’s a piece of value associated with it. So you go back and you look at all those years, the time and the ups and the downs and the freakout and whatever, it’s all, I feel like it’s necessary to go through that. You can’t come out on the other side without having, without kind of going through that process because there’s, or you certainly don’t appreciate it on the backend because it’s… the meaning and the purpose isn’t there and you have to go through pain. It’s like it’s transformative. I got a couple other questions for you that are maybe, okay, stupid question I think I know the answer, but you know, could I eat your cake? Can humans eat your cake or is it just for dogs?

So technically I can’t recommend that you eat our cake just because we don’t have the health inspections for people–

Okay, yeah.

So we don’t have that little certification; however, I can tell you that I have tested all of our products, I regularly test our products, like with the new ice cream mix I will always test that out and, because I know how it’s made and we use all human-grade ingredients and we have very high standards. When we get, we do a voluntary audit annually for good manufacturing practices and we got 97% compliance on our last inspection.

That’s awesome.

So, again, I can’t legally recommend that you eat it–

I was just curious.

But I can tell you that I have eaten it–

Yeah.

A lot.

So, how many dogs do you have and what are they?

Okay, I have five dogs. I live in the country so whenever I take my five dogs for a walk none of them are on leashes and we don’t really have to deal with some of the other messes that you know someone who has a backyard might deal with. So having five isn’t such a challenge as someone who might live in the suburbs or in an apartment. And they’re all rescues, all mixes. I’ve got three Terrier mixes that are all unrelated and look very different. One I’ve joked that he’s a short-haired Pomsky because everyone thinks he looks like a little mini Husky with short hair. I’ve got like a little, basically a Rat Terrier that’s like 25 pounds and then my other Terrier’s name is Gary and I think he’s the cutest thing in the world, but my husband thinks he’s really ugly. And then I have a brother-sister pair that are cattle dog Boxer-Beagle mixes. And so we’ve got quite a gamut of animals. And then we also have two three-legged cats.

Okay.

That get along with everybody.

Two, three-legged cats, okay, and they’re rescues as well I’m guessing.

Yeah.

Yeah okay, that’s awesome, but they are probably, they’re probably very excited to be, to you know be in your home because I’m sure they get to be the guinea pigs, so to speak, for–

Yeah.

For all of your products so they’re very lucky.

They are my taste testers and sometimes they get to come to work too.

That’s awesome, no that’s super exciting. So, I, you know, I just want to thank you for coming on and kind of sharing your story talking about just the different, just the, the ups and the downs and just the whole, I think it’s super fascinating. I think what you’re doing is really exciting. I think it’s awesome that, from a manufacturing standpoint, that it’s just kind of like I’m, you’ve got that mechanically inclined side to just, maybe it’s that process side, to be able to say, hey I want to, I know I can do this there’s a way to be able to figure it out. And I think it’s interesting we’ve talked to a lot of different manufacturing leaders, you know, companies that have been around since, 100 years, 75 years, or, I talked to a guy the other day he had his business for, he’s had it for 50 or 60 years, and very sort of similar stories and I think there’s a really awesome entrepreneurial spirit with that, but it’s also the process mind and that comes together and it’s just very cool to hear these stories. So congratulations.

Thank you, yeah I love manufacturing. I’m definitely in the right industry. I like to show how it’s made, I love to just watch machines work so–

Yeah.

I’m definitely like efficiency-minded and this is the right place for me to be in.

Well, that’s awesome. So my last question is, what’s next? What is next for PuppyCake?

So we are launching a ton of products at Global Pet Expo. I mentioned to you that trade shows are our number one marketing spend because they’re well-worth it. Global Pet Expo is one of two of the largest trade expos for pet products in the United States. The other being SuperZoo in Las Vegas. So I’m launching a birthday station floor display to help independent pet retailers have a birthday display instantly in their store which will include our cake mixes and our ice cream mixes and some toys and accessories. We’re also launching a new line of no sugar added ice cream mix called Hoggin Dogs.

All right.

And that’s spelled H-O-G-G-I-N, we did get the trademark for it.

You always want to make sure there, yeah.

Cross your fingers that we can keep it.

Yeah.

And then also we’re launching a smaller version of our ice creams. We started with a pint size and now we’re launching a cup size because a lot of households have small dogs, like under 25 pounds and so that’s also going to come with a gift pack. And so that’s what’s coming up for us. We’ve got a really big year. I think it’s going to be great and we’re excited about it.

That is awesome. Well that’s super exciting, again, I’ve already, I’ve sung your praises a bunch, that’s awesome. Keep up the great work and the innovations and I’m excited to see what the next five to 10 plus years, or whatever that is, what that looks like for you because it sounds like you, you’re really, really on to something and you have continued success. So congratulations, thanks for coming on. If people want to come check you out I’m assuming puppycake.com?

Yep, that’s it.

And I encourage everyone, yeah just go check it out, take a look at the story. I’m sure there’s the Shark Tank clips and things on there you can go Google and do all that stuff. And obviously if you have dogs and you want to celebrate things puppycake.com. And you can go get them on Amazon, or visit a retailer, right?

Yes.

All right.

Thank you so much I really enjoyed this.

I did too, thank you. All right so listen I loved this. I’m super excited, I love hearing these kinds of stories. This is, you’re going to hear more of this with IndustrialSage when we come out, we’ve been getting some feedback that hearing entrepreneurial stories and just the people behind how they’re starting things, whether it’s a manufacturing company that’s been around since for 50 or 60 years, or companies that have been around a lot shorter, and I think this is just a really great story of that blend of that passion and that entrepreneurial spirit, process, really figuring things out.

And I think really at the core that is, you go back to American ingenuity, and you go back to The Industrial Revolution and if you look at how we have progressed in a hundred to 150 years, it’s really on the backs of innovation of people who are saying, whoa, maybe there’s a better way to do this, we can do it faster and we can, and that’s the focus and it’s been, if you look at our history, it’s super exciting to see that and that’s what you’re seeing here with Kelly. That’s why I love her story because it was just like, I don’t know how this, but we’re going to figure this out, we’re going to do it and make it happen. So that, just capturing that spirit. Oh man I love it.

So, thank you for listening or watching. We’ll be back next week with another episode of IndustrialSage. If you’re not on the email list get on it and we’ll send you all this information and more. We’ll obviously have puppycake.com so take a look at them, they’ll be in the show notes and I’ll be back next week with another episode of IndustrialSage. I’ll see you then.

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