COMMERCIAL SALES MARKETING ASSESSMENT Steering Committee Update 1222020

COMMERCIAL SALES & MARKETING ASSESSMENT Steering Committee Update 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 1

PROBLEM STATEMENTS • Recent Tiger Team assessments found areas of concern & examples of initiatives being performed out of sequence • All regions missed the commercial number last fiscal year • There is no organic growth in the commercial segment • There is a lack of a centralized sales or marketing strategy. No mechanism exists to ensure best practices are shared internally • There may be wasted efficiency and duplication of efforts • There has been little recent sales training at the rep or manager level • The sales process has not been adopted by the field • Market Segmentation work has been performed, but lacks Account level and Buyer level segmentation 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 2

OBJECTIVES & DELIVERABLES PHASE 1: SALES & MARKETING ASSESSMENT Objective: • Assess current state using evidence from the market, customer, field and corporate lenses to identify and quantify sales and marketing effectiveness gaps. • Identify, validate and quantify opportunities for growth. • Prioritize the opportunities for growth based on the financial return, level of effort and probability of success. DELIVERABLES • • • 12/2/2020 Sales and Marketing Gap/Gulf Analysis Sales and Marketing Critical Success Factors Execution SWOT PHASE 2: SALES & MARKETING STRATEGY PREPARATION Objective: • Work with senior management to prepare and present a Sales & Marketing Strategy using the results of the Assessment. The Strategy will address gaps in the company’s operating plan. DELIVERABLES • • A Sales & Marketing Strategy document that covers the assessment areas from the framework on the next slide Feasibility Analysis / Resource Assignments SBI Proprietary & Confidential. All rights reserved. 3

ASSESSMENT AREAS: PHASE 1 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 4

Strategy | Market Segmentation Leverage ACME INC. Segmentation and align to marketing and sales strategy: Current State § Current penetration is 20% overall (1) § Market has been segmented by employee size and vertical § Segmentation has not yet created actionable plans for sales on how to attack segments with most potential § Targeting by buyer behavior (low tech, comfortable with tech and high tech aptitude) has been analyzed § Product plans are based on horizontal solutions § Some Competitor Analysis has been generated but it relies largely on feature function comparison, not how competitors market and sell § Actionable plans need to be determined to attack vulnerable competitors (by competitor) § Commercial Strategy plan may be outdated Sources (1)“Commercial Impact ACME lacks an understanding of which commercial prospects and customers it should target by product and by geo. Therefore, ACME INC. has have an incomplete understanding of how to staff and deploy resources in order to increase penetration to 40% in 5 years (1). Considerations should also include competitors by region, company size, buying behaviors and verticals. 12/2/2020 Best Practice § Total Available Market - No. of businesses passed and communications spend by small, med. and enterprise § Competitor Analysis – view into how the ILEC, CLEC’s and cable position their services and win & retain customers § Product/market Mix Assessment - determine the appropriate product sets to lead with in acquisition. Determine market size by product set. § Marketing SWOT – determine strengths and weaknesses of each competitor and how to differentiate on what matters to each segment § Product/Sales Lifecycle Assessment – determine a upsell methodology for each segment that informs the next most likely product a customer will purchase Strategy” presentation, Executive interviews, Market analysis SBI Proprietary & Confidential. All rights reserved. 5

ACCOUNT SEGMENTATION Focus sales’ money, time and people on the accounts which will generate the most revenue over the shortest period of time. 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 6

GULF: ACME INC. HAS NOT IMPLEMENTED A CONSISTENT METHOD FOR DETERMINING ACCOUNT POTENTIAL Strategy | Account Segmentation § Ideal customer profiles (ICP)s identifies the “most ideal” commercial customers for ACME INC. to target § Propensity to Buy (Pt. B) factors provide insight into who buys, why, and when. Consists of ACME INC. and 3 rd Party data. § Account Potential enables companies to project annual spend from customers and prospects. Also used for territory design modelling § Account Scoring— leverage the ICP and Pt. B to provide each business a score to then stack rank each account and point sales assets at it. § Account Segmentation Model – an MS Excel based tool that contains the above 4 components and allows for advanced analytics § Customer Acquisition Cost (CAC) is calculated regularly and used for resource and GTM channel planning § Customer Lifetime Value (CLV) is calculated regularly and used for service/support investment and cross-sell/up-sell planning Curren t State § Opportunity to align marketing identified ICP’s to sales strategy § Sales does not incorporate results vs potential in stack ranking. § Results should be matched to potential opportunity in territory, instead of “peanut butter spread” across regions § No Propensity to Buy determination for any channel § Lack of Account Seg Model prevents Marketing from tailoring campaigns to specific industries, verticals Source s Documentation review, Data Review, SME interviews Impact Best Practices • Without Account Seg, ACME INC. doesn’t know how to properly set quotas or determine territories for the sales org, or which prospects and customers to devote resources towards now v. later • Sales plans and results can’t be analyzed by comparing actual results to the real potential 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 7

BUYER SEGMENTATION Help sales people understand how buyers in their accounts make purchase decisions. 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 8

GULF: BETTER UNDERSTANDING HOW/WHY KEY BUYERS OF YOUR SOLUTIONS MAKE PURCHASE DECISIONS WILL ENABLE MORE EFFECTIVE DEMAND GENERATION Strategy | Buyer Segmentation Current State § Basic Buyer personas exist but do not capture all the relevant details of each buyer § BPMs have not been developed § Sales training is inconsistent/ineffective; not delivered by sales professionals, and not supported by all RSMs § Too much emphasis on ACME INC. operations/products instead of customer’s needs and buying cycle § ACME INC. is not engaging prospects early enough in buying cycle § Leads are not tracked by persona § Very few sellers (40%)(1) hitting quotas, creating a large gap between actual and target pay § Market is not aware of ACME INC. as commercial grade provider. § Desired positioning of ACME INC. as able to ‘save time’ is not aligned to all personas’ psychographic profile (1) § Buyer Personas capture all relevant detail on key personas on the Buying Decision Team; they are leveraged by content developers, creatives, campaign planners, and even sellers Best Practice § Buying Process Maps (BPMs) visualize how your buyers purchase and track their evolution from ‘Not in the Market’ through to ‘Solution Implemented’ § Buyer Value Chain Analysis shows what your buyers value from the provider -- marketing and sales related -- when engaging with them § Critical Success Factors (CSFs) establish the minimum boundary for best-in-class performance, again, by persona Sources (1)“Commercial Impact Since ACME INC. hasn’t created complete buyer personas and buyer process maps for each type of commercial buyer, Sales and Marketing have an incomplete understanding of what stimulates latent demand with actual buyers, and how to create relevant marketing content and run effective campaigns. Buyer Segmentation is a must for demand generation, sales productivity, decreasing churn rate and improving client relationships. 12/2/2020 Strategy” presentation, Documentation review, SME interviews, Sales Force Reports SBI Proprietary & Confidential. All rights reserved. 9

ACME INC. COMMUNICATIONS COMMERCIAL SALES & MARKETING ASSESSMENT Appendix I 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 10

MARKET SEGMENTATION Divide the broad target market into subsets of buyers who have common needs and priorities 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 11

SEGMENTATION: MARKET SEGMENTATION • Leverage Market Segmentation to Understand where Growth is Achievable What is Market Segmentation? • It is dividing the broad target market into subsets of companies and buyers who have common needs and priorities. What is the purpose of Market Segmentation? • To identify the market potential revenue for priority and resource allocation What is the benefit of Market Segmentation? • Connect Corporate goals to Product, Marketing and Sales Strategy • Products positioned to top segments and horizontally to all others • Align Marketing & Sales Resources 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 12

SEGMENTATION: MARKET SEGMENTATION • Example Output of Segment the Serviceable Market • TAM = Total Addressable Market Reachable over 5 years • SAM = Serviceable Addressable Market. Can be reached today with build outs • Target = Immediately Serviceable • ICP = Immediately Serviceable and in top segments 12/2/2020 TAM $3. 70 B SAM $1. 93 B Target $900 M ICP $525 M SBI Proprietary & Confidential. All rights reserved. 13

SEGMENTATION: MARKET SEGMENTATION • Example Use of Market Segmentation Once Segments are identified and compared to actual results, penetration and other variables by segment can be determined Confirm: Methodology to prioritize segments: low vs high penetration, share of wallet etc. Outcome: Actionable list of segments to attack and why 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 14

ACCOUNT SEGMENTATION Focus sales’ money, time and people on the accounts in your market which will generate the most revenue over the shortest period of time. 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 15

SEGMENTATION: ACCOUNT SEGMENTATION • Account Segmentation is the Foundation for Sales and Marketing Success Demand Generation, Lead Management Quota Setting Account Potential Compensation Account Prioritization & Coaching 12/2/2020 Talent Management Territory Design SBI Proprietary & Confidential. All rights reserved. 16

SEGMENTATION: ACCOUNT SEGMENTATION • Account Segmentation Model Customer Segmenting • • Account Segmentation Workbook Industry Sales of Customer Bookings Geography Pipeline Revenue Customer Master File 3 rd Party Data Pt. B Formula Translation & Transformation Booking Potential Account Scoring 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 17

SEGMENTATION: ACCOUNT SEGMENTATION • Account Segmentation informs Corporate Strategy Account Score Propensity-to-Buy Factors Growth & Predictive Factors (Y-o-Y Growth %) Ideal Company Profile Factors Firmographic Factors (Revenue/Employee size) “How much can they spend? ” Prioritized Accounts Account Potential Segment Potential – Over all spend of other similar companies Share of Wallet - % of spend that ACME INC. has Prioritized H Pursue “Who should we pursue? ” “Where should all resources (people, money and time) be allocated? ” M L Deprioritized L M H Potential 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 18

SEGMENTATION: ACCOUNT SEGMENTATION • Example Account Scoring Formula Company Rev. Employee Size 40 pts. Total 2014 company revenue of the company 12/2/2020 Company Growth % 35 pts. Total employee headcount in company 15 pts. Company revenue growth over 3 years Industry Total 10 pts. 100 pts. Industry SBI Proprietary & Confidential. All rights reserved. 19

SEGMENTATION: ACCOUNT SEGMENTATION • Example Quarter over Quarter Implementation Component Quarter 1 Quarter 2 Quarter 3 Quarter 4 Key Activities • Leverage Market Segmentation Analysis to connect to Corporate Goals • Conduct RACI Workshop • Combine with Account Segmentation to align Product, Marketing and Sales • Implement Product, Marketing and Sales execution plans • Continue to monitor lead process and update as necessary. • Refresh analysis • Identify execution gaps • Modify plans and take corrective actions • Incorporate market and competitive changes Success Metrics • Market Penetration Calculation • Market Penetration & Share of Wallet • % Attaining Quota • Financial Metrics • Misalignment of Marketing and Sales Strategy • Strategy breaks down at the sales activity level e. g. they do not shift activity to prioritized segments • Sales operates on a ‘peanut butter’ spread of quota • Results are not compared to potential • Do not hit the number Ownership Risks 12/2/2020 • Accountable – TBD • Responsible – TBD • Consulted - Marketing and Sales Leaders • Informed – Executive Leadership • Misalignment of Marketing Strategy to Corporate Goals • Incorrect understanding of where growth will come from SBI Proprietary & Confidential. All rights reserved. 20

BUYER SEGMENTATION Help sales understand how buyers in their accounts make purchase decisions. 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 21

SEGMENTATION: BUYER SEGMENTATION • Buyer Segmentation Toolkit Capabilities 1. Standardize Training and Buyer Engagement 2. Think Outward-In vs. Inward-Out 3. Understand who your buyer is and what influences their decision making process 4. Use Buyer Personas and BPMs to engage your buyer at the right time with the right message 5. Align Conversations and Solution Positioning with Persona needs at each point in the process 12/2/2020 SBI Proprietary & Confidential. All rights reserved. 22

SEGMENTATION: BUYER SEGMENTATION • BPMs Help the Customer Make a Purchase Decision What is a Buying Process Map? • A Buying Process Map is a representation of the decision making process which a specific persona goes through prior to working with a vendor What does it mean to use a Buying Process Map? • 12/2/2020 It means you understand where the buyer is in their decision making process Not in the Market Stimulated Problem Definition Options Evaluation Finalize Recommendation s Execution How does a Buying Process Map help? • • • Focused Conversations: Sales and Marketing use BPMs to target messaging directly at Personas and their stage in the buying process Alignment to the Buyer: BPMS help direct sales and marketing activities and become more buyer-centric Move Opportunities Forward: BPMs enable sales and marketing to anticipate questions and concerns the buyer has and address them upfront SBI Proprietary & Confidential. All rights reserved. 23

SEGMENTATION: BUYER SEGMENTATION • Example BPM Showing Two Stages Finalize Recommendations Buyer Action Check References Get Boss’s Approval Questions Dave Asks ‐ Do the references validate my decision? ‐ Am I in compliance with my purchasing department policies? ‐ How am I going to position this with my boss? ‐ Do these guys do what they said they would? ‐ Are these references relevant? ‐ Can the project team get it done? ‐ What’s it going to take to get my boss to go along with this? Dave Title: Dir. of Network (Enterprise) Segment/Role: Ent (Buyer) Employees: 500+ 12/2/2020 Execution Buyer Action Submit Final Approval to Formal Approval Process Questions Dave Asks ‐ Who do I have to get to sign it? ‐ What is the time lag? ‐ How do I get them to sign it ‐ What is the alternative to a quickly? signed contract to kick the ‐ Will the vendor get started before project off? the final SOW is signed? SBI Proprietary & Confidential. All rights reserved. 24

SEGMENTATION: BUYER SEGMENTATION • Leveraging Personas & BPMs in Marketing Creation of Marketing Collateral Persona / BPM Design and Execution of Marketing Campaigns Creative Brief Marketing Collateral Offer SEO – Organic Persona / BPM 12/2/2020 Marketing Input High Value Searched Content Collateral and Cadence Direct/ Email SBI Proprietary & Confidential. All rights reserved. 25

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