Barrett Thompson: If you think about what we've come through in the past 18 months, it's been a time of tremendous price increases that the market expected, and many businesses have had record price increases, and in some cases they've actually had record earnings to go with that. But when the economy turns, if it does, a different kind of action is going to be required. More the case of taking prices down by just the right amount, not too much. And just the right time. Not too soon. And not too late.
Lindsay Duran: Welcome to B2B Reimagined. My name is Lindsay Duran, and I'll be your host for this episode. For the first time, both co-host Barrett Thompson and I will share the mic as we take stock of a new year and look back at some highlights from 2022.
How are you doing today, Barrett?
Barrett Thompson: I’m doing great, Lindsay. Thank you.
Lindsay Duran: Before we get into [00:01:00] the more serious topics at hand, do you have any personal updates you can share? Any recent voyages into the Arctic?
Barrett Thompson: Perhaps you remembered when I took that snow camping trek up into Canada. Last year. There were some personal records set there in the below zero camping. No, this year we turned it the other way and we took our scouts south. We went down to the Okefenokee Swamp and spent two nights sleeping out on the platforms in and amongst the alligators.
So that was a wonderful experience and everyone should try it.
Lindsay Duran: That sounds amazing. And also slightly terrifying if I have to admit.
Barrett Thompson: Well, the mosquitoes are probably the biggest risk.
Lindsay Duran: I can imagine. Did you have to wear a mosquito net over your face?
Barrett Thompson: No, I didn't. I will say we were smartly, we chose the colder part of the year because that sort of minimizes the bugs.
Lindsay Duran: Excellent, excellent. Well, it sounds like it's not your first rodeo, then.
Barrett Thompson: Make sure that we study our handbook because this got all the tips in it and go with a great [00:02:00] guide. We had a wonderful ranger who'd been there many times that he knew the ropes. And Lindsay, I know you're quite the world traveler. Wonder if you've had any globetrotting recently.
Lindsay Duran: I have had some globetrotting recently, although I'm pretty excited about an upcoming trip that I'm planning. Last year I sort of fell in love with the Canadian Rockies. I went to Banff on a couple day hiking trip in the summer, and so the same group of us we're planning a trip to Whistler this year, so we'll be back in Canada doing more hiking, but I'm more of a, I'm more of a day hiker and then sleep in a hotel kind of person. I'm not really willing to risk it and camp out there and incidentally run into a bear.
Barrett Thompson: It's all good. I mean, if you're gaining some altitude and seeing the great outdoors, it's qualified in my book.
Lindsay Duran: Absolutely. And probably also on the horizon is a trip to Albania later in the year and [00:03:00] a visit to a place that's been on my list for a while that I think maybe flies under the radar for most people. But Albania has some beautiful beaches and I'm ready to go check those out as well.
Barrett Thompson: I'll be looking for my postcard in the mail. Gotta see it.
Lindsay Duran: Absolutely. Well, Barrett, let's go ahead and dive in. I know that you've hosted many an episode of the podcast. But maybe we can spend a little bit of time and just remind our listeners what your role is at Zilliant.
Barrett Thompson: I'm the GM of Commercial Excellence, and in this role I lead our solutions engineering team. Those are the folks that are very close to the use cases, the customer needs, and the technology capabilities itself, and bringing those together to define that solution that will best serve our customers. And you Lindsay?
Lindsay Duran: I lead the marketing team at Zilliant. I've been at the company for about 11 years in marketing roles and in sales roles, and currently the CMO for the past three and a half years.
So now that our [00:04:00] listeners have gotten to know the two of us a bit better, I wanted to start things off by thanking them. 2022 marked our most successful year of podcasting by far. Not only are the download numbers higher than we ever thought they'd be, I've also heard anecdotally from partners and customers that it is a regular part of their media consumption diet.
It's really gratifying to hear, and it's all thanks to you, our audience, and a lot of word of mouth as they share with colleagues. So a special thank you to, to all of our listeners.
Barrett Thompson: That is a great milestone for us, Lindsay. I agree with that and I want to give the shout out to our fascinating guests. Because they have really made the podcast go.
They've brought their experiences, their business acumen and their accomplishments right here to our listeners. So I've really enjoyed those interviews that I've been able to conduct and we’ll each share our must listen episode recommendations at the end of this podcast. So stay tuned [00:05:00] for those.
Lindsay Duran: With the new year upon us and so much economic volatility and digital transformation happening, we thought it was a good time to take a pause from our regularly scheduled programming and share notes on what we're both seeing in the market, me from a marketing perspective and Barrett you from the sales and solution side of the house.
Barrett Thompson: Yep. That sounds great. So let's each take turns asking each other the questions, and we'll see where it goes from there.
Lindsay Duran: Perfect. I'll start. Barrett, what concerns are you hearing from the market as you and your team work with prospective customers that maybe differ from what you heard this time last year?
Barrett Thompson: I think at the highest level, it's just becoming clear that businesses need to prepare for a new normal, a new reality.
Now, post Covid, so many things, of course, were disrupted and challenged during that period. It's not as if we'll just return to the [00:06:00] way it used to be. And that touches on a lot of areas. What do your customers expect and what do your employees expect? Your sales team, for example, and what are the relationships with your suppliers likely to be like, and how predictable or stable will the economy be or not be?
So these things are changing. I think they're sort of permanently changed. The degree can be different for different industries. But what I would characterize that I'm seeing is people are gearing up. Companies are gearing up for a new normal, and typically that means things like automating processes where we can, because they look at the inefficiencies of how they've tried to respond.
When things were very predictable, you would see something coming from miles away. You would have years to get ready or quarters to get ready and respond. Now those very same changes, you may only have three weeks or six weeks visibility, and then you need to get busy doing it. So I see a theme, for example, of help me get ready [00:07:00] to respond quickly.
I see a theme of help me enable the fact that I have remote workers. And so I'm not going to bump into them in the coffee room. I'm not going to bump into them or go by their cubicle and say, Hey, let me just check in and see how things are going. Were you able to follow up with X, Y, Z? They're looking more at a systems approach or a tools approach to keep track of that because people are maybe working different schedules or they're working different locations, different time zones, but they still need to coordinate all their work together. And I think these companies rightly see technology as a path to help address that.
Lindsay Duran: Absolutely. Companies and some of our listeners probably know us mostly for our pricing solutions, but we've had what I'll call revenue operations and intelligence solutions for quite a while in the market and they solve a really unique problem for a lot of our customers. How do you see those solutions as a way to counteract some of the supply chain [00:08:00] issues and sales headcount challenges for B2B companies?
Barrett Thompson: That's a good question. I think there are complementary pieces there. I want to, I'll start with that last one first. Many businesses are acknowledging that they'll be running their business and even trying to achieve their goals with fewer headcount than they had before. That could be for a variety of reasons that might be budgetary for them.
People might have selected out of the business. There's a lot of competition for talent right now. So they look at that and they say, well, how can I enable my teams for greater effectiveness and greater productivity as individual contributors to the organization. Those revenue operations and intelligence solutions, they're built to do that.
They're looking through the data, finding the things that a sales rep would find most likely if they had 20 extra hours every week to comb through reports and try to generate some charts or some analysis. They might find some of the very same things, [00:09:00] but no one has that. They never have, and they certainly don't have assistance and staff, human staff to help them.
The rev ops and intelligence solutions go and find those actions, those missing products or missing categories, cross-sell opportunities, that sort of thing. It finds them very easily and then puts them front and center. So there's a playlist, if you will, that the sales reps are alerted to go for these things.
These are great opportunities in your portfolio, specific to your customers. It's not just a high level idea. It's very specific coming out of the customer's buying behavior, and that turns into a very direct action. Sales reps can pursue those actions. And then they're adding immediately to their top line and bottom line for doing so.
That's how I see that headcount angle being addressed, making those individuals more productive by lifting up those actions right on the front line, right at the time they need it when they're about to walk in and speak to a customer or pick [00:10:00] up the phone and have a conversation with that customer.
On the supply chain side, there are maybe some different ways that the solutions adding value. One example is that I found so relevant. When you are looking ahead or getting a notification from a supplier that you're likely to have a shortage in a certain product, then using the revenue operations and intelligence tools, you can begin to suggest immediately which products would be a viable substitute for the SKU that's about to go on back order.
And then you can push that straight out to a sales rep and say, let's be proactive about this. Let's call these four or five customers that you have out of your portfolio of 100, all of whom consume this particular item. It's about to go impossible to find in the market, but we have several substitutes that would be viable.
Call them ahead of time. Talk to them about that situation. Suggest and recommend the sub. [00:11:00] If they agree that they can and will take that substitute item, let's get that immediately entered into the systems and on the ERP so that they can place a seamless order and they won't have a negative experience when they're trying to order some item and then you say to them, oh, I'm so sorry, that's out of stock.
And now we, and it will be for a while to come. It's on back order. And now we need to have a conversation around what products might be an acceptable substitute and how much will we charge you for them? And let's get that all entered into the ERP. That can all be done upfront, and that's a relationship saver in many ways.
It takes friction out of the process. That's an impact that Rev ops and intelligence is having on the supply chain issue.
Lindsay Duran: I think that's such an important point. Barrett, in the approach that companies have normally taken to try to solve for those challenges is running a BI report, parsing it out by sales reps, sending out a report via email, and what inevitably happens.
The report's not super actionable. It gets buried in the pile of other [00:12:00] emails, and it's sort of a send and hope that some action is taken. And it's not specific enough for sales. It's not clear enough of what they need to go do and frankly, it largely gets ignored because they're so busy doing so many other tasks.
And so what you just described is a way to really operationalize what people have been trying to do for many years and by giving sales something actionable and concise and super specific. So it really is quite a game changer for companies that decide to take advantage of it.
I think so. So Barrett, if an executive asks you what the number one thing they should do to prepare in the face of a potential recession, what advice do you give them?
Barrett Thompson: I tell them that they need to make certain that they have price agility, right? The ability to be quick and surgical. If you think about what we've come through in the past 18 months, and we see this in some [00:13:00] of the 10K filings and other corporate reporting, it's been a time of tremendous price increases that the market expected them.
It wasn't so complicated. In terms of customer relationship, I mean, customers don't like it when the prices go up, but they understand why it's happening, and many businesses have had record price increases, and in some cases they've actually had record earnings to go with that. But when the economy turns, if it does a different kind of action's going to be required.
More the case of taking prices down by just the right amount, not too much, and just the right time, not too soon, and not too late. And so that's the kind of agility that I'm thinking about here. Recognizing that price decreases may be on the horizon. The timing of those is important and the amount of change is important.
If you miss the timing or you overshoot or undershoot, the amount of change, either of those will have a deleterious effect on your business. So that's what I tell the execs. They need to be thinking about being very price [00:14:00] agile and very surgical about that. They'll need typically to adopt technology and perhaps some process changes as well to their business to make those things happen.
Lindsay, if I may, let me ask you what you're seeing in the marketplace. We've been beating the drum for some time at Zilliant about replacing those manual commercial processes with software. Now, from your perspective, how do you think that message has been received? Are you seeing an uptick in interest given the economic curve balls that have really overwhelmed those spreadsheet driven processes?
Lindsay Duran: Absolutely. I think agility and speed have really been the name of the game for companies that invested in pricing software pre Covid, I think they really benefited from just the flexibility to change price and I think about a story from one of our building products manufacturing customers that when Covid started and demand sort of dropped in the market[00:15:00] for building products, it certainly didn't stay that way.
But at the very beginning, yeah, there was a little bit of a dip, and what they found was that their salespeople really wanted to cut prices and they were thinking that they were losing to the competition when in actuality it was just a drop off in demand. And so the pricing team and the commercial team really used the price elasticity measurement that are an output of our price optimization solution to help defend where prices should be.
And if you think about, taking a big drop in price when there's an economic shift. It really then reinforces your customers on a new price. And it can be really hard to get that price back up to previous levels. And so that's why having data and really kind of, I'll call it advanced data, informing your decisions and using that information so that everyone working [00:16:00] off of an objective measure as opposed to the emotion that can come with big swings in the economy or something like a pandemic as we certainly all experience, I think is, it's just so important. And so companies that made that investment really saw the benefits as we saw a massive amount of volatility. And, as inflation crept in, they were able to keep pace with that in a way that companies that were only used to executing one to two price changes a year and did that through sort of brute force, Excel spreadsheets and manual processes were really behind in that regard.
And we're seeing companies that got to that level of pricing sophistication of really having pricing software now being more forward thinking and proactive, asking the question that you touched on of, energy prices and prices of certain metals and lumber and building products and certain industries and certain commodities are seeing a [00:17:00] little bit of a price drop, or at least the rate of price increase is slowing.
And so they're already thinking about how do I handle that with my customers and how do I do that intelligently and not drop prices too soon and not lose volume? And I think that becomes, especially as we see a softening in demand and so companies are really going to have to balance maintaining the margin gain that they were able to get with trying to keep wallet share of their customers and not speeding and overpricing in the market.
And it's really hard to do that if your go-to method is spreadsheet.
Barrett Thompson: This is such a great insight. I mean, what you've described here is it's not just the circumstance that may present. Which will challenge you, the market circumstance, the economic circumstance, et cetera. But your own response to that circumstance, your reaction, or overreaction to it, is a whole other level of challenge and a systematized approach.
A data-driven approach [00:18:00] will support you and keep your discipline right, and protect you even from your own overreaction, which is not necessarily how we always promote the benefit of the solution, right? It helps you do the right thing you'd want to do if your cool head were prevailing. But I see that's a great insight.
Lindsay Duran: I think discipline is the right word there, Barrett. And there's so much discipline that can be gained from having the right tools and data at your fingertips so that humans can make good decisions using those.
Barrett Thompson: Let's look forward then what is your prediction for the trajectory of the pricing and revenue optimization management space in the coming three to five years?
Lindsay Duran: We all wish we had a crystal ball. I certainly see a bit over the last 10, 15 years, companies had spent quite a bit of money and time and resources investing in what I'll call commercial execution. Things like CRM and ERP and configure price, quote [00:19:00] software and e-commerce platforms and marketing automation tools and what have you.
And, all of these tools are really powerful and, are needed to run a business in many instances. But what I think companies have increasingly come to realize is that all of those tools are, they're just not very smart in and of themselves. They're great for executing processes for helping you run your business, but they're not really adding intelligence to a process.
That gap has probably been acutely set over the past three years as companies are looking for any advantage and any leg up during this really volatile time that we're all living through. With all of that in mind and that realization that companies are beginning to have, I see pricing and revenue optimization and management as really the next wave of where companies need to invest.
In five years, if you're still using, if you're a company of [00:20:00] any significant size and you're still using spreadsheets, email, and swivel chair between systems to run your business, you're gonna be really far behind and you look at projections, the percentage of commerce that's going to happen through online channels.
You can't rely on a sales rep to be the filter between the overly broad prices that you set at corporate and the price that the customer actually sees. You've got to get a price to a customer that makes sense and the exact context of their selling situation without necessarily needing a sales person to intervene.
Now, that doesn't mean that the role of the salesperson goes away. But the role of the salesperson might not be to translate your corporate prices into a good price for the customer. Their role will be to sell and add value and maintain that customer relationship overall, because that doesn't necessarily go away.
And so I think, as [00:21:00] companies will look towards their digital transformation journey and what's next on the horizon, I think adding that layer of intelligence to how they're getting their work done and how they're making decisions is sort of on the forefront. And we're really seeing that with an uptick in demand, certainly for our solution.
I think about things like chatGPT and what that's able to do in many instances. And it's adding, people are realizing the amount of intelligence that it can add to things. Sending a sales follow up email or writing a marketing email or, what have you. I think the sky's really the limit.
And so as people embrace AI and embrace fact that data and models can really do things that humans just simply can't do at scale, I think this space is really going to take off over the course of the next three to five years. I'm curious, Barrett, what your prediction is for [00:22:00] this.
Barrett Thompson: I certainly agree that the technology is improving at an exponential rate, and so that's opening some doors for us that weren't there before.
I want to key in on the word transformation. I think that's an important one. We'll hear digital transformation often to label an internal initiative, but that's got a complementary transformation of what some of our traditional job roles have been. If it's on frontline sales, we'll add value in different ways, product recommendations, product selection, advice on application, et cetera, et cetera.
Which is a higher value than just getting your invoice line item correct. Because we can get the, we can get a system to do that. We can get a technology set to do that. So I think transformation is a big part of the outlook that the tools will continue to open more doors for us and allow us the people in the process to do higher value activities that we used to have to spend time doing before because we didn't have that automation.
I think that's a great [00:23:00] point, Lindsay. As I mentioned at the top of the show I want to leave our listeners with recommendations for the shows that we've each hosted in the past year. It's hard to pick because there's so many great ones, but I'd like to share these with the listeners. Episode 46, “Your Value Prop is More Than a Tagline.”
This features Jose Palomino and episode 50, “Stop, Drop and Roll Won't Extinguish Your Selling Pains.” I know that's an odd title, but check it out. That features Ian Altman, his keynote address for Mindshare. Those are two episodes that they're just full of sales strategies, blending of revenue operations and intelligence software, sales coaching, leadership methods.
Really fantastic. I encourage the audience to engage with those and just listen to the passion, enthusiasm, and practical ideas for effective B2B selling. And then two others that have something in common. Episode 50: “The Need for Speed” featuring Jeet Mukherjee from Holden Advisors and episode 61, [00:24:00] “Inflation, Value-Based Pricing and Trucking” from Gene Metheny of Carlisle and Company.
I group these two conversations together, not only because they focus on the pricing side of commercial excellence, but they also deal with that headline issue of our day: inflation and volatility. And so there's great information lent by both of those knowledgeable leaders into that situation. So please check those out and apply that content for yourself in the days ahead.
Lindsay, how about your episodes?
Lindsay Duran: Those were all great episodes, Barrett, that really drew a lot of attention from our listeners. I agree this was a challenging exercise, but the interviews I conducted that really stand out for me are episode 62, “Rush Enterprises Overcomes Supply Chain and Inflation Challenges with Data Science.”
Gonzalo Benitez, who leads pricing and data analytics at Rush gave us a look behind the curtain of how supply chain and inflation [00:25:00] problems have impacted heavy duty truck parts and how Rush Enterprises have been primed to persevere thanks to data science driven pricing and sales. Gonzalo was an awesome guest and had such fun stories to share with us.
Episode 67, “Building Materials and Construction: Perspective and 2023 Forecast.” This was featuring Craig Webb, president of Webb Analytics and episode 69, “Addressing Margin Erosion and More Manufacturing Trends” featuring Frank Borovsky, who's the VP of Industry Sales for Manufacturing at Salesforce. One of my favorite things about this podcast are the deep dives that we get to take into specific B2B industry verticals.
I don't see a lot of content out there that really matches it. For two of our final episodes of 2022, we took stock of the building products and construction industry with Craig and manufacturing, automotive, and energy with Frank. These [00:26:00] quickly became some of the most popular episodes of the year as our guests brought really fantastic insight into what the future may hold for these bedrock industries in a volatile time.
Barrett Thompson: Those are also great recommendations, Lindsay. I hope those in our audience will please be sure to check out those episodes if you haven't heard them yet or hear them again, give them a re-listen. Thank you for being with us for our first podcast episode of 2023. There will be new episodes coming your way soon with more great guests.
Lindsay, could I ask you to share some special news that you have with our listening audience?
Lindsay Duran: Certainly Barrett. Thanks. I am sad to say, and it's bittersweet that I share that this will in fact be my last episode of B2B Reimagined. I am stepping down as CMO of Zilliant to take some personal time off, to spend more time with family and friends and traveling and relaxing.
So you will [00:27:00] be in fantastic hands, as you already know, if you've listened to any other episodes of our podcast with Barrett Thompson leading the charge here on the podcast. So I'd like to thank all of you for trusting us and spending your time with us and listening to the insight that we and our amazing guests have.
It’s been a real pleasure hosting the podcast as well as spending the past decade plus with my friends and colleagues at Zilliant.
Barrett Thompson: Lindsay, we're going to miss you. Let me say, on behalf of the entire Zilliant team and this listening audience, let me offer our most sincere gratitude and fondest farewell and best wishes to you as you go on to your new adventures.
We look forward to hearing. And I hope that our paths will cross again, thank you so much for your contributions to Zilliant and your contributions to this podcast, immeasurable in all fronts, we [00:28:00] appreciate you.
Lindsay Duran: Thank you very much, Barrett. I hope you enjoyed this episode of B2B Reimagined. Very special episode in more ways than one.
We remain committed to your success at Zilliant, and if there's anything we can do to help you address pricing or sale challenges in your business, please reach out to us on zilliant.com. Please also feel free to connect with me on LinkedIn. I hope to hear from you. And as always, if you are enjoying the content on the podcast, please take a moment to rate and review the show as it helps us to continue to put out great free content.
Until next time, have a great day.