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Innovation or Transformation?

I’m reading Disrupting Digital Business by R “Ray” Wang right now. It’s a good book, and I recommend it. You should read it, too. You can buy it here


As the subtitle suggests, Mr. Wang’s book is about “creating an authentic experience in the peer-to-peer economy.” I think it’s easy to look past what Mr. Wang is suggesting when he writes “peer-to-peer economy.” My interpretation of that phrase is that commerce happens based on infinite interactions among individuals rather than a monolithic conversation between “brands” and “consumers.” In other words, conversations are the new commercials.  

It’s not like word-of-mouth is a new concept. But the notion that word-of-mouth travels at the speed of light is. Before the invention of the telegraph, word-of-mouth was a one-horse-power machine (that was the rate of transmission for a written or oral message to the next house, the next farm, or the next town). The telegraph increased the speed of communication exponentially, but had only a marginal impact on simultaneous reach (one might send a telegram from station to station, but the information still needed to be distributed to individuals through less sophisticated and slower means).  

Nearly 200 years later (the telegraph was developed in the 1830s), instantaneous communication happens with almost zero friction. One-to-one, one-to-many, many-to-one, and many-to-many communication is happening right now among nearly infinite devices, applications, and people with the equivalent power of a private conversation.  

And most of those conversations are about buying stuff. The more things change, the more they stay the same.

So riddle me this, Batman. If most buying decisions are disproportionately influenced by conversations in the cloud, why are most software companies still marketing and selling like it’s 1999? The first Sears, Roebuck & Co. catalog was published around 1888, and we haven’t really changed the model much — advertise to a large group of people with a monolithic message and hope that a small percentage of them order something. The only difference now is that the process happens faster because we have phones and the Internets and stuff … but not much else has changed. What we accept as “conversion rates” for our sales and marketing efforts wouldn’t even add up to a good clinical trial for an OTC itch-relief medication. Frankly, I’m not sure that a placebo sales and marketing system wouldn’t work better than the traditional B2B system.

So back to Mr. Wang’s book. He writes, “The heart and soul of disrupting digital business comes from a passion for transformation.”  He goes on to write, “Incremental innovation, once viewed as the key to sustained success, is now the norm. It’s expected. And it’s just not enough.” And yes … I read more than the first chapter.  

What does this have to do with sales and marketing? Most companies I meet with are trying to innovate a dying system rather than transform their sales and marketing processes to fit into a “peer-to-peer” digital economy. You know where most of your deals come from? Digital word-of-mouth. So what are you doing about it?

I suggest that ye abandon all hope in the concept of the funnel. In fact, you should from now on refer to the funnel as the gauntlet, because what you’re really trying to do is beat the shit out of prospects with your process and technology to see if any are tough enough to make it through the pinhole at the end of the tunnel.   

Don’t innovate your sales and marketing function. Transform it. And do so with the full understanding that we live in a peer-to-peer economy driven by millions-squared of digital conversations happening in the cloud about your brand. Do something about that.  

I’ve not read a sales or marketing book out there that addresses this issue (if you have, please tell me about it). But I will say that Mr. Wang’s book Disrupting Digital Business (which is not about trench-level sales and marketing operations) delivers a compelling case for why businesses should pursue transformation as opposed to innovation. And a good global thinker with trench-level sales and marketing experience ought to be able to extrapolate many excellent hypotheses from the book. Like I said, buy it now