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Research Triangle Business Advisors October 2013 Newsletter |
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Finding Sales Success... Sales success is achievable if the seller uses tools, techniques, and proven strategies. Unfortunately, top managers and new sales people don't always understand the basics that bring repeatable success. And, the seasoned veteran sales professionals often forget the value of following the basics. I had to decide to cover this topic in one article or break it up over a few smaller articles over the next months. I decided to put it all in one place and at one time. This month's article is a bit longer than my normal short subjects. This newsletter attempts to cover sales from "soup to nuts." I'm sure you will find at least a couple of items that will help you improve your sales success. Feel free to contact me if you have questions.
Bob De Contreras 919-280-1307
Finding Sales Success 1. Selling Skills Selling is an art and a science. Successful sales people never sell the same way twice. They understand, shift, communicate, present, negotiate and more in different proportions depending on the situation, client needs, and products or services they are selling. However, the sales process does have basic steps that include:
2. Situational Fluency In order to be an effective sales person requires a basic set of skills that are driven by the need for flexibility in the buy cycle. These skills are continuously changing based on where the seller is in the buy cycle. This goes from marketing and prospecting all the way up to the signed contract. These skills can be grouped into four basic areas:
We will discuss developing some of these skills later in this article, but the best approach would be for sales people to attend formal sales training education offerings. 3. Sales Person Vocabulary Often sales people are characterized by that time honored image of the “used car salesman.” Most people do not have a good view of sales people. Adjectives used to describe them include: liars, cheaters, slimy, fast talkers, double talkers, etc. Therefore, top sales people use vocabulary that does not make them sound like that “used car salesman.” Likewise, top sales people don’t use “wimpy words.” These are words that imply a lack of self-confidence or lack of belief in the communication they are presenting. These are both about the sales person sounding more professional. Examples of words that should never leave the lips of a sales person include:
4. Selling Principals There are many books that have been written on the subject of selling skills or selling principals. To present all the information on this topic is beyond the scope of this article. Therefore, what follows is one view of the most important selling principals or basics. These principals are based on the fact that the top sales people have conversations, ask questions, and are Interactive with the buyer. This is in contrast to less successful sales people who tend to make “canned” presentations, tell the buyer what they need, and are repetitive (telling the same story over and over again like a song on the radio).
There is a good lesson that sales people can take from doctors. Doctors diagnose before they prescribe. They do the diagnosis even if they already know what’s wrong with the patient. Let’s look a situation that occurs in the doctor’s office: You have a cough and sore throat, you came to see the doctor, and when the doctor comes into the examination room he says: “Good morning, how are you doing today? What seems to be the problem?” You respond with: “I have a sore throat and a cough.” He immediately says: “Here take this prescription and have it filled, take one pill morning and night until it’s all gone. If you don’t feel better in a week call me.” HOW DO YOU FEEL ABOUT THAT INTERACTION WITH THE DOCTOR? Not good? Why? Your response is, “Because you didn’t ask me anything.” The doctor might respond to that thought with, “Oh! Well you didn’t know, but there is a flu bug going around, you’re the 10th patient I’ve seen today with the same symptoms, it had to be that and I gave you a prescription to ease the symptoms.” DOES THAT MAKE YOU FEEL BETTER? No? Why? Your response to that might be, “You still didn’t look at me - you didn’t examine me.” The doctor might respond to that thought with, “Didn’t you see my diploma on the wall. Don’t you know that I went to school for 20 years to get those diplomas?” DOES THAT MAKE YOU FEEL BETTER? No? Why? Your response to that might be, “I want you to examine me and diagnose my illness and then prescribe the medication based on the diagnosis!” This little story explains why your doctor always checks your heart, your ears, your eyes, your throat, your reflexes, etc., even when you come in to see him with a problem with the nail on your big toe. The diagnosis is not for the doctor, it’s for you – so you feel like he has diagnosed your situation. It’s the same with sales – your buyer wants to feel like you have diagnosed his situation before you prescribe your solution. Top sellers ask a lot of questions.
There are three plateaus or levels of business need. They are foreground, background and vision of a solution. These plateaus describe the buyer’s mental image of needs and solutions. A foreground Need is one where the buyer recognizes the need, but does not know how to solve it. A background Need is one where the Buyer is ignorant of the need or rationalizes that the need can’t be satisfied. A vision of the solution is the result of the buyer and seller participating together in determining the when, who, what, via of the buyer’s solution to his need. The sales process then is the sales person using the diagnosis or asking questions to move the buyer from background need to foreground need to the vision of the solution. If the sales person has done a good job, this vision will be the one using the seller’s capabilities. The reference story, anxiety question, capability question, and feature statement are sales tools to build to the vision of the solution. This process is sometimes called needs development The vision of the solution might look like the following: You’re (who) driving home after work in your car (when), in a severe thunder storm - it’s raining cats and dogs. It’s one of the worst storms you have ever seen. All the way home you think about how you’re going to get soaked or hit by lightning running from your car to the garage door to open it (what). Wouldn't it be nice if you could push a button on a little box (via) that is attached to your sun-visor, yes from the comfort of your clean and dry car seat, and the garage door would open automatically so you could drive into the garage without having to get out of your car in the pounding rain? If this was possible would that help?
People buy from people says more than those simple words. First of all it says that “paper” does not sell. That means that proposals, Request for Proposal responses, Request for Quotation responses, and other documents don’t sell. And, therefore generating paper is a waste of time with regard to winning and completing the buy cycle. However, people can do things that cause the buyer to be uncomfortable with buying from them. We have all been made aware of the importance of the first impression. The first impression, that first 60 seconds after meeting a person, can make the difference between sale and no sale. The first thing we see in the first impression is how we are dressed and groomed. Top sales people have learned how to “mirror” their buyer – dress and act like the buyer. This is about helping the buyer be comfortable with the seller. For example, if the buyer is dressed in a shirt, tie and coat, and the seller is in an open collar shirt, there is a misalignment. The buyer might be thinking, “I can’t buy from this guy, he doesn’t even know how to dress professionally.” And, the sale is lost before the seller even starts the buy cycle. The next thing that could derail the impression of the seller is Sincerity. Some people call this being genuine. One of the things sales classes have taught can make the seller appear insincere. They are taught to look around the buyer’s office when they enter. Look for trophies, photographs, wall hangings, etc. Then use one of those items to seed the start of the discussion. For example, “Is that a golf trophy? Golf is a great game. Do you play often?” But, if the seller is not a golfer or know a lot about the game of golf, it will only take the buyer a few seconds to figure that out. The result is that the buyer sees the seller as insincere. The seller should only guide the discussion onto topics he is well informed on. Better yet, the seller should come prepared to kick off the discussion with some planned comments to show sincerity. This a good place to use the reference story. These comments could be comments about the seller’s company, the seller’s industry experience, and why the seller is there to meet the buyer. If the seller is not seen as sincere, there is a high probability that there will not be a sale. If the seller gets past the first impression and sincerity, the buyer is going to then be focused on competency. Think about it – would you trust or want to spend your valuable time with an incompetent seller? Competency comes into play when the seller starts talking about why he is there. If the seller starts this part of the meeting with the proverbial, “How’s it going,” the meeting is probably going to end quickly. At this point, the seller should extend or elaborate on the reference story with how he was involved, what he contributed to the situation, or how he has been involved in other similar situations. The discussion should be anything that builds credibility and shows competency. People buy from sellers who understand the buyer’s situation. So, all during the first impression, sincerity and competency phases, the seller needs to show how he understands the buyer’s situation. This could be understanding the buyer’s company (after a good question and answer phase). Or, it could be understanding the buyer’s industry or similar customer situation. As we discussed earlier in this article, buyers don’t like to be told what to do. “You need…” should never leave the lips of the seller. In the context of this part of the buy cycle, the seller should empower the buyer. The buyers believe they know what they need and they want to make the decision to buy. So, empower the buyer to make those decisions. The seller owns the decision on how the buy cycle proceeds. The hardest thing about “people buy from people” is that they buy from people they like. Believe it or not, if the seller does the things we just discussed, he will be “liked.” Clearly there are some relationship skills, body language skills, and social skills that the seller must possess, but if the seller only talks on the planned topics and is prepared for the meeting, the buy cycle will progress.
Another reason for using the sales processes, tools, and methodologies we have discussed so far is that buyers often make emotional decisions. Buyers are not always consistent, predictable, or rational. Consider the following situation: A golfer has not been thinking about anything but buying a new golf club - a Big Bertha. Not a knock-off, but the real thing. He’s decided to buy it at the country club on Saturday when he plays his regular round of golf. When he gets to the club house, he gets into a conversation with his foursome and hears that one of their friends has been killed in a carjacking. This has really touched close to home. He immediately stops thinking about the Big Bertha and starts thinking about his safety and automobile security systems. You know the kind you buy from Smith & Wesson. This golfer wanted the Big Bertha because all the other members of his golf foursome had one. It was not because he “needed” it – an emotional decision. Clearly the decision to NOT buy the new golf club and buy from Smith & Wesson was an emotional decision. In this situation the seller cannot tell the buyer that he’s made a bad decision. The only thing the seller can do is remind the buyer of his stated need and what the buyer said was his reason for his vision of the solution.
In order to have the best chance of getting to the signed contract, the seller must find out who has the power to buy. And, the seller must get access to the power person. There is a simple test to find out if the person being sold to can buy. The seller can ask, “… If you decide that this solution is what you want, what then; does anyone else have to approve the purchase?” There are only two answers to the question. The best answer for the seller is, “No one else has to approve the purchase - this is within my authority and budget.” With this answer the seller is on the way to a signed contract. The second answer is, “I have to take this recommendation to my manager for his approval.” At this point, the seller has just discovered that he has been selling to someone who cannot buy. This is most often a waste of time. At this point the person that was perceived to be the buyer will often say, “I’ll talk to my manager and tell him we need to have this solution.” In other words he is saying he will go sell to his manager. The chances of success at this point are weak because no one will sell the solution better than you. Now the only way the seller can get to a signed contract is to get a meeting with the manager and start selling to him. Buy the way, when the seller gets to the point of agreement with the manager on the solution, the question has to be asked again to verify if this person has the power to buy. Another important point related to finding the power person is the fact that power buys from power. Just as the seller must find the person who can make the decision, the buyer wants to be working with the seller who can make the decision. This means the seller who can commit the resources of his company, agree to price discount and deliverables. The buyer does not want to have to go searching for the real seller. This means that most successful sellers are empowered by their company to satisfy the buyer needs and make the sale.
One of the most difficult sales concepts for sellers to learn and accept is that the solution to their buyer’s need must be the buyer’s view of the solution. Inexperienced sales people know their capabilities and they know where and how they fit in the buyer’s company. This leads to that trap of telling the buyer what they need – “You need this solution.” As we saw earlier, buyers don’t want to be told what to do. Now, this leads to a seller problem. What if the buyer’s view of the solution does not include capabilities the seller provides? Again, the seller is tempted into saying something that could lose the sale. Upon hearing the buyer’s vision of the solution, the seller might say something like, “… Oh! That’s not the best solution. The best solution is [my solution] that uses [my capabilities].” The trap is that upon hearing this remark the buyer hears that comment as, “You’re a dumb executive and you have chosen a stupid solution.” Therefore, the best sales approach is to accept and agree with the buyer’s view of the solution. This keeps the buyer and seller in alignment with each other. The seller can now start working to expand the buyer’s vision of the solution to include capabilities of the seller. The seller does this by asking more questions. The buyer/seller dialogue might go something like this: Buyer: “The way I’d like to solve this problem is to develop a mobile phone application and distribute it to all our customers.” Seller: “That’s a great idea. Buyer: “Thanks.” Seller: “Would it also help if you could capture and save customer satisfaction comments from that new mobile application? Buyer: “Well, I hadn’t thought about it, but yes, that would help.” Seller: “Would it also help if your customer service department could be contacted by your customer directly from the new mobile application?” Buyer: “Well, yes.” Seller: “So, what I’m hearing is that you want to implement a new mobile phone application and you would like to also include the ability to track customer satisfaction and allow customers to contact your support department directly from that new application.” Is that correct? Buyer: “Yes, that’s correct.” Seller: “Our customer support system can provide those capabilities and more.”
It’s not usually a good use of seller time to sell to someone who can’t buy. If the person doesn’t have the authority to sign the contract or get the money for the sale, they can’t buy. If the seller is “selling” to someone who can’t buy, the seller is basically doing free education, marketing or seminars. And, that means the seller is not going to meet sales goals. “Selling” to someone who can’t buy is only a good idea if that interaction will get the seller introduced and access to the power person (the person who can buy). 5. Buyer Focus Over Time Research has shown that buyers go through phases of shifting concerns as they progress through the buy cycle. These psychological steps a buyer goes through to buy, can predict the buyer’s behavior. Buyers usually express four typical concerns:
We have discovered that as buyers progress through the buy cycle the priorities of each of these concerns change. Let’s look at each of these concerns in more detail. The first thing a buyer focuses on is need. They ask themselves if they have a need, and if they don’t perceive a need they don’t even start the buy cycle. Therefore, at the beginning of the buy cycle, buyer need has a very high priority. Next the buyer focus shifts to cost. The buyer now has a potential vision of a solution and the buyer wants to see if an affordable solution exists. Then the buyer focus shifts to exploring the available solutions. At this point the buyer is comfortable with the need, cost, and vision of the solution and has made a decision to buy. After the decision to buy has been made, the buyer focus shifts to risk. The buyer starts worrying about the risk of making or not making the decision to buy. Risk includes thoughts like: did I choose the best product, will the poor economy impact my job, how long will the solution last, am I getting the best price, etc. If the seller sees the buyer getting nervous about the purchase, this is a good sign. It means the buyer has made the decision to buy and is now focused on risk. It should be noted that the seller cannot help the buyer with feelings of risk. The buyers have to work it out by themselves. The only thing the seller should do if risk is seen is to remind the buyer of his stated need and benefits from the vision of the solution. The four concerns change priority over time and to show this I have broken the buy cycle into three phases:
Looking at the graphic shows that in Phase I: Need is the highest focus and risk the lowest focus. In Phase II: Solution is the highest focus and price the lowest focus. In Phase III: Risk is the highest focus and solution the lowest focus. The seller can stay in alignment with the buyer by understanding the buyers changing focus over the buy cycle. 6. Why Sellers Lose the Sale It’s a fact of human behavior that people don’t really want to hurt you. So, if the seller lost a sale and then asked the buyer why he lost, it’s not likely that the buyer would say the real reason. The buyer does not want to say, “You were a poor sales person and I didn’t trust that you could do what you said.” Instead, buyers say things like, “They had a better price,” or “They were able to provide several features you couldn’t.” In the end, the seller does not know why it was a loss. Research has been done over the years and you might be surprised at the results. On average, 15% of the time the seller wins the sale. 25% of the time the sale is lost to a competitor. And, 60% of the time the buyer makes a decision to not buy – a no decision. If a seller wants to improve his sales rate, he should focus on getting more of the “no decision” business. That begs the question, “Why do buyers choose to not buy?” It turns out that the top two reasons are that the seller didn’t have access to the power buyer – the person who could really buy. Or, the seller and buyer didn’t jointly develop the vision of the solution – get the seller’s capabilities into the solution. 7. Required Information from a Sales Call Believe it or not, many sales people “wing-it.” They “sell” to a prospect without having planned the effort. These sales people may not know anything about the prospects industry, their company or their competition. But, the biggest problem is that they don’t have a structured approach to the sales call. Now, that may not be a problem as long as the sales person walks away from the sales call with some important information. As long as the seller gets the following information the sales effort can lead to a new sale.
8. Buyer’s School You are reading this sales information and you may even take a sales training class. I hope you don’t think your buyers aren’t doing the same. Your buyers are in fact attending buyer’s school. Some of the things they learn at buyer’s school include:
9. Negotiation If you don’t know where you are going when you start, how are you going to know when you get there? It’s important to build a negotiation plan for your interaction with the buyer. Decide on three or four “stands” or positions you are willing to take. This starts with the most optimistic view of what you want and ends with the least you will take. You must know that bottom line position before you begin negotiating. As part of the planning, get as much information as possible about the buyer, the situation, and competitive alternatives. The person with the most information has an advantage in the negotiation. Information equals power. As the seller negotiates he should not give without getting – Quid Pro Quo. And, to do it right, the seller should take before he gives. The words might be something like: Seller: “If you could do this for me, I might be able to do something for you.” Buyer: “That’s possible!” Seller: “OK then. If you can do this I can do that.” You have heard this, but most sellers will just not do it. Be willing to walk (out of the meeting) and do it at least once. The buyer needs to know you are serious and this is the only way to show it. When it’s all said and done, the buyer must believe he’s getting the best price and function. 10. Summary
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