“I am great with relationships, I’ve been married five times!”
It seems to be a common misperception in human nature that quantity is better than quality. This is a side effect of short-term thinking, which dismisses the long view in favour of the instant gratification. It lowers our standards and hurts us in the long run.
The title of the blog came from a conversation with a women I met about a year ago – an interesting history she had with a definite focus on quantity!
Our society is full of this plague from binge drinking, teen pregnancy, overeating, to over consumption of all kinds.
In business, we have seen the big banks stealing from the very customers on whom their long-term survival depends. Billions paid in PPI, Libor, and Money Laundering penalties. Who knows what will be next?
These are not drunken teens but our best and brightest – or are they?
The world economies are looking to small business to stimulate the economy but too many have adopted the same short-term thinking, looking for the fastest route to revenue growth often sowing the seeds of future failure. In the last ten years I have seen an increasing trend with small business away from careful planning and investment in the future toward buying business and pushing short-term results.
The economy hasn’t helped and both boom and bust economies tend to promote short-term thinking.
I have spent much of my career building sales territories and businesses and I have learned one very powerful lesson about business. If we take the long-view and invest in the development of a solid sales process not only will business grow but it will get stronger and more robust over time!
Plan for today and every day will be the same. Plan for tomorrow and each day gets stronger and better.
The 1993 movie Groundhog Day with Bill Murray is one of the best examples of this concept – very entertaining and thought-provoking – highly recommended.
As a business development consultant, my thinking is always on how companies can best grow today and into the long-term and aside from having a great business plan, a powerful sales process is key to business growth.
A sales process has many aspects and touches every area of the business but for this article I will isolate five areas of the sales process which, if executed properly, will result in a solid and predictable stream of revenue for the business.
The five areas of a sales process are:
** I will add a section each day this week completing this blog article by Friday.
Monday: Sales Leads
We talk all the time about sales leads. But what do we mean? What is a sales lead? What is the definition of a sales lead?
Here’s one I found on Wikipedia:
“A sales lead is the identity of a person or entity potentially interested in purchasing a product or service, and represents the first stage of a sales process.”
My summation would be, “finding people who may want to buy your product.” I would further narrow it to, “finding people who may want to buy your product, may well need or want it and can, or soon will be able to, afford it.”
Let’s stop for a second because this is not the definition that most businesses use!
Most businesses think that the phone book, linkedIn, Facebook or a Networking event is a group of leads – they is not!
I cannot tell you how many owners have said to me that they have lots of leads but that the salespeople cannot convert them. When I ask to see the leads I am told that every business in such and such sector is a lead. It is not and thinking so will stall your business faster than you can imagine.
Thinking that lists of businesses are leads, which they are not, starts the sales process heading down the wrong street right from the beginning. And although following any street in London can eventually get you to Liverpool it would be better to head straight toward to M1.
To develop a target list we need to ask hard questions:
Who is your ideal customer. If you cannot clearly identify what your ideal customers looks like then you will waste a lot of time! For some businesses this is rather straightforward and for others it can be a gut wrenching process.
For example, if you sell/rent cloth napkins then your customers will be found within the hospitality industry.
But let’s drill down a bit more.
Not all businesses that serve food use cloth napkins and so we can eliminate fast food, economy style restaurants, hospitals and low-cost airlines. So, we have a smaller list.
Now we can drill down a bit more.
Are we in a margin position to both wholesale and sell to the trade? Do we provide a laundry service for restaurants that essentially rent their linen? Are we restricted geographically? Depending on the answers to these questions our business might focus on wholesalers and hospitality laundries across the UK or better restaurants and hotels within the M25 / Greater London area.
Let’s drill down deeper.
Do we provide top quality white, all cotton napkins and tablecloths to five-star restaurants and hotels or themed linens in two hundred colours for the wedding market? Again, this further defines our targets.
Let’s drill even deeper!
Are we top price / full service, middle of the road, or value focused? Again, this further defines our targets!
If we keep drilling we will eventually end up with several market segments that we can effectively market to with the knowledge that they are companies with whom our products and services are matched. In this case we move from selling nationally in dozens of channels to a focused, highly definable market.
So in the end we know that our market is ‘four and five-star restaurants, hotels and clubs within 30 minutes drive of central London.’
All of this may take hours or days to complete for your business depending on the complexity but the process will clarify your entire business.
From this knowledge we can create a target list, a real list that we can begin to contact in a variety of ways.
As we contact each prospective lead we will qualify to determine if there is business potential. If there is then that contact becomes a lead.
The same can be done for every single business from luxury car rentals, to business consulting to home pizza delivery. It is easier for some businesses than others but until you do this you will waste enormous amounts of time talking to the wrong people.
If you are one of these networking addicts, who feel that it is worth the investment to speak to anybody I will tell you that, using Six Degrees of Separation, that 3.6 people may connect me to the Pope but I still can’t get you an audience. Focus on your real market!
In the late 1990’s Hertz car Rental made a discovery, which changed its entire way of marketing. Analyzing all car renters it realized that the average American rented a car very infrequently but that some business travelers were frequent renters (more than ten rentals a year). The frequent car renter was identified as being .002 percent of the population – that is 80 people in a football stadium of 40,000.
Hertz also understood that concentrating on the frequent renter resulting in a much more focused marketing campaign and the ability to deliver huge service incentives to those frequent renters. The result was higher customer loyal and profits. That’s ROI
Knowing your target allows you to define your market, focus your efforts and lower your cost of sale.
The Pipeline is the daily workings and management of all of your business opportunities.
It can be a simple as a binder with pages for each qualified lead or it can be a more sophisticated CRM system. There are lots of CRM (Customer Relationship Management) programs. Some simple ones like Capsule CRM are free for single users and allow you to track and manage the customer relationship.
The problem in most businesses is not that the product cannot be sold but that the salesperson gives up selling. A good, well-managed pipeline should eliminate that problem.
Let’s go back to the case of selling/renting cloth napkins to five-star hotels.
Once we have identified a group of leads then these contacts should be entered into the CRM database. Here the pipeline management begins and the magic of CRM systems shows.
Sales guidelines must be determined for prospect management scheduling – how often prospects are contacted and by what methods. Each contact with the prospect is recorded and strategies developed and recorded. As the sales relationship are developed, prospects move down the pipeline until the sale is closed and the prospect becomes a customer.
Once a prospect does becomes a customer the relationship continues to be managed in the pipeline for the development of repeat business, referrals and customer satisfaction. Don’t ignore your customer in favour of hunting new business!
The problem with pipeline management for most businesses is that it simply does not happen. If a system exists then salespeople are poorly trained and lack the discipline to use the system. The result is prospects are rarely contacted enough and at the right frequency to convert prospects to customers.
The pipeline is the lifeblood of the business. If managed properly the future volume of business is highly predictable.
The reason pipelines are rarely managed effectively is that the sales process is poorly devised and poorly understood. Sales Pipeline management is a medium to long-term process and most mediocre performers don’t want to be bothered.
The best salespeople instinctively know that a strong sales territory is not just about closing the customers in front of them but planning three steps ahead.
In my years in field sales I have made thousands of pitches. I have failed and I have succeeded wildly and what you will learn here is based on everything I have learned.
It is possible to close 100% of your pitches with planning, preparation and focus.
Lots of people will tell you that selling is simply a numbers game and that it is all about putting in the work. They will tell you that a certain percentage will say ‘no’ and a certain percentage will say ‘yes’ – these people don’t know how to sell.
I have worked in sales environment where I earned 10 times the average income.
I can promise you that I wasn’t working 10 times as hard. In fact, I was working significantly less hours then the others.
Years ago, I read about an insurance salesman whose pitch was to call people listed in the telephone book, introduce himself and ask, “you wouldn’t want to buy life insurance would you?”
Did it work? Sure, it worked! He made hundreds of calls a days and just out of random chance found people who had a specific and immediate need for life insurance.
This is not selling and not an approach to build a business.
The key to successful pitching is simple.
1) Not all customers are the same. It takes the same effort to sell a client who can spend £10,000 as £500 – identify the cream.
2) Figure out the profile of the customer most likely to buy and put your efforts in that direction. If you are selling a new service look for the early adopters. Don’t try to sell to someone who isn’t likely to buy. Don’t waste your time or theirs!
3) Listen to customer and let the customer write the pitch! If you have identified your ideal prospect correctly then just listen. Let people talk and they will tell you the benefits they want. You can then phrase the pitch in terms that are meaningful to your prospect. The prospect will sell themselves.
4) Understand the overwhelming benefits of your product and present the top three most likely to be meaningful to your prospect. Make it about them!
5) If you are selling to a homogenous group, which you should be, then you can use feedback from each pitch to adjust the pitch and make it stronger. This is another way the customer writes the pitch.
6) Close as fast as possible! Use trial closes to know where you stand and the moment the time is right then ask for the order! Once you have the order quickly move on – sales can be lost.
Lots of salespeople believe that selling is about trickery or grinding down the resistance of the buyer. Still more salespeople feel that if they talk enough that they can convince the buyer with emotion or logic – this is not what the best salespeople do!
The best salespeople
1) Know the real value of what they are selling.
2) Prepare fully
3) Know who wants what they are selling.
4) Find the highest value prospects
5) Listen to the prospect carefully
6) Pitch using the prospects’ values
7) Trial close
9) Know that the best time to pitch is when you have just closed
Selling is a target sport. Know where you’re going and your chances of getting there raise exponentially!
I have been selling since I was fourteen years old when I had my first retail job – I remember the old style cash registers with all the buttons! It seems strange to me that some people have trouble closing but the reality is that even the best salespeople sometimes forget to close.
We don’t think we’ll get the order.
We are afraid to come across as rude or pushy.
We simply forget.
We are focused too much on helping the customer.
Fear of rejection
Closing is easy. First you use a trial close, which is basically any positive statement or suggestion on the part of the buyer, to ascertain that they are ready to buy and then you use a variety of closing techniques.
My favourite is any presumptive close: ‘When can we get started?’ ‘Can I get you card details?’ ‘When would you like this delivered?’ or perhaps, ‘Do you need to issue a purchase order or would you like me to simply invoice you?’
If you get push back on the close then you instantly back off and look to uncover and objectives or concerns. Once you have tried to close and been rejected then you must proceed very carefully. Prospects become very sensitive at this point and there is huge potential to damage the relationship permanently. Remove all pressure and let them lead the process until you get another buying signal.
It is just like fishing! Get a bite, reel them in but once they begin to fight let them swim a bit before you pull again. If you get into a drawn out fight with a fish on the line and most of the time you will lose the fish – it is no different in selling.
Let’s go back to the reasons why salespeople don’t close.
1) We don’t think we will get the order. I have been in many situations where the buying signals were extremely weak and I thought that I would never get an order but I went for the close anyway and got the business – always ask for the order! Always!
2) We are afraid to come across as rude or pushy! If we have a great product or service that we believe is in the best interest of the client then the client deserves the opportunity to buy! Don’t be shy – you’re helping them. Would you ask a drowning man if he needed help?
3) We simply forget. The moment your selling gets into ‘automatic’ mode you will get off purpose and let the client lead. Stay focused on your goal all of the time. ABC – Always Be Closing!
4) We are too focused on helping the customer. I knew a man who sold tools from a van to mechanics. There was one young mechanic who wanted to buy an expensive tool that my friend knew he couldn’t afford and shouldn’t buy as he had a young family. My friend made the decision not to sell to him but on the next visit noticed the young mechanic had bought a similar tool from the competition anyway. Your job is to sell not judge!
5) Fear of rejection. We all have fears and most of them are based on a false perception of our world. We convince ourselves they are real but they are no different from the childhood monsters under the bed. Face your fears and let them go – they are only holding you back!
One of the best-selling films ever made is Glengarry, Glen Ross. It shows the fears that hold salespeople back and is a must see for every salesperson. Warning: Lots of rude language!
Word of mouth advertising is the most powerful you can get!
You’ve just been to the best restaurant ever and you can’t wait to tell everyone you know! When someone asks where they can take someone special for dinner you’re ready with all the information.
You become an advocate for the business.
Referrals are the gold standard of business marketing.
In the old days, although I am sure this still happens, an insurance salesperson would ask upon closing a deal for five referrals – ‘Wouldn’t you like to help your friends make the same great decision?’ This was another close and the best way to strong arm these contacts out of your rolodex was when you had just been weakened by the sales process – you were putty in the salesman’s hands.
This rarely works anymore and social media has changed all of this.
Two strategies that do work:
Referral club: This works great in fields like insurance and real estate where referrals are common and agents frequently pay referrals fees but can fit into every business.
Create a formal club and when you have found a new customer tell them that you have a referral program where you pay a fee to anyone who refers new business. Be clear on what they get, put all of the details in a printed brochure and then develop the referral club as you would customers for your main business – perhaps even a networking party once a year! Deliver great service, pay pre-determined referral fees and nurture and build the relationships.
One of the many powerful opportunities within social media is that it is natural viral. If designed correctly, with lots of share buttons, then your blog, website, whatever can be instantly shared with the reader’s network or sent to specific friends.
I cannot believe how many people miss this opportunity and have none of these share buttons on blogs – even though they are a ready option to be installs in seconds. Make it easy for people who love you to share you!
LinkedIn has a great recommendation process where you can request written recommendations – give them freely and ask for recommendations! If someone writes a recommendation for you – ALWAYS give one in return.
Ultimately referrals come down to relationships. Do you have great relationships with your clients? Do you maintain relationships by continuing to be helpful long after the cheque has been cashed?
A business can be build strictly on referrals with little or no advertising.