John Hirth's commentary on sales...

"History repeats itself..." does this old adage apply to sales??

History repeats itself and those who fail to learn the lessons of history are doomed to repeat them! You've heard that one before, yet may not have thought about that old history lesson in relation to your selling career. Well, the value of this lesson has a lot more to do with sales than you might think... let's take a look.

There are great lessons to learn and strategies to build when you understand the conditions under which you win and those under which you lose. Regularly going through a "win, loss" review will allow you to understand where you typically succeed and where you typically fail and why. Once you understand the conditions that drive the outcome of your selling activities you'll know better how to respond to any given situation. You can build new strategies to support your efforts and increase your percentages!

A company we work with did a six month "win, loss" review (history) on price quotes issued to prospects who they had not previously done business with. They believed that quickly responding to requests for price quotes demonstrated a high degree of responsiveness and would win them business. They knew they were not winning often, but were shocked when they found out their efforts had only gotten a 4% return (4% of quotes yielding orders). By looking at history it became quite apparent that they needed to change their strategy of "demonstrating responsiveness". Not only was it not working but it was costing a lot of staff time and resources.

The new strategy, based on what they learned from looking at their history, was to call every request for pricing first and ask questions about the request. They found that most of the time it ended up being a "price check", but also found that through making a personal contact they actually got information and ended up closing 15% of the opportunities instead of 4%. They also were able to identify that most of the "wins" were not being serviced by one vendor exclusively. So, learning from this historical record drove them to ask the question "how many vendors are you currently buying from?" When they got the answer "one" they knew it was unlikely they would win and drove them to ask more questions to qualify the opportunity better.

This ends up being a clear example of "learning from history and not repeating the mistakes of the past!" Learn from history and you'll be winning more of your opportunities. We'll cover some other "history lessons" in upcoming posts... happy hunting!

How did you do on your "report card?"

I'll bet that headline made many of the people who will read this nervous! It probably brought back some childhood memories...some good and some bad!

Report cards were an evaluation tool used to tell both the student and the parents (gulp) about the progress (or lack of ) the student was making. This assessment tool was an integral part of improving the outcomes of the educational experience. So I wondered, could the same idea be used to improve the experience your customer is having with your company (parent) and their sales people (students)?

Account retention is part of most sales jobs and one that is usually not given the attention that it deserves. Everyone knows its easier to "keep" a customer than "get" a customer but far to often companies and sales people put to much emphasis on "getting" rather than "keeping". Those that realize the importance of account retention spend more time on it but usually don't have an organized way to manage it.

So, in order to improve account retention, how about developing a "report card" that you can use on your most important customers. A report card would allow the customer to "grade" the performance of you and your company keeping you ahead of any "problems" that you might not be aware of. Quarterly "report card" meetings should be set up between you and your customers to get their feedback on the performance of the company and the sales person who calls on them. Report card meetings can be a "metric" and responsibility that sales people should be held accountable for.

The wrong time to focus on account retention is when your customers informs you that they are doing a "vendor review". Stay ahead of the game, develop a "report card" for your company to apply to your best customers. Be open not afraid of honest feedback and you can win the retention game! 

"Your emotions have no business in the business of selling..."

In our ongoing work with sales teams and sales managers we continually stress the importance of maintaining an even keel. Emotional control is a critical element to success in sales (an element of sales DNA) and letting your emotions control your responses in our business is usually not a good thing.

Too often, sales people get excited on sales calls. As soon as you get "excited" you'll probably respond the wrong way. Here is an example:

Your prospect says:

    "I've heard great things about your company...".

We get excited and respond with:

    "Yes, we've been in business for 35 years and have a great reputation in the industry, In fact..." 

Hearing a positive comment that would seem to be in "our favor", we get exited and move in for the kill! Talking more about why we think we are good and sounding like a typical "enthusiastic" sales person. Our emotions are in control and unfortunately, as long as you're talking, you're not learning anything you didn't already know! You are no longer in control of the conversation.

Rather, taking emotions out of the situation and responding "intellectually", you'd be more inclined to respond with:

    "I'm glad to hear that, what have you heard?"

The prospect now answers your question with:

    "I've heard you have excellent customer service and shorter lead times than some of your competitors".

Now look what you just found out! You know what they value in a supplier and it would be important to stay "intellectual" and find out why they said that! I'll bet it relates to some "dissatisfaction" with their current supplier!

Maintaining emotional control is more difficult for some people than others but is certainly an important element of being successful in sales! Work on it and you'll make a lot more money!

"I'll give you the business if you can beat my current price..."

“I’ll give you the business if you can beat my current price…” Ever get this one…sure you have. You’ve gotten it from one of your good customers who seem to always be willing to “give you a shot”. Sometimes you’ll get the business and sometimes not…the problem is “not”.

These requests can waste a lot of time, particularly when you don’t win! Let’s talk about the request and see if you can win more of these opportunities as well as get a little more margin too!

Let’s consider why good customers are willing to give you a shot on additional products? Sometimes it’s just from the good will you have built up…they want to “throw you a bone”. Other times, there are problems with their current supplier and if you were aware of the problem, you could provide products that would work better (add value), as well as build some leverage that would allow you to charge more and get better margin.

So, to improve our percentages and get better results let’s look at some strategies that will help us get more of what we want. First, we’ll need to change the way we think about these opportunities in order to sell more of them and get higher prices. Most of us come to these situations with the belief that unless we can beat the price we won’t get the business. This is called a “non supportive belief” and we need to change it in order to be successful.

If you think about it, why would they come to you to replace a product they use and are happy with? Usually they won’t, and often when they ask you for the “can you beat my price offer”, there’s usually a problem with what they’re currently using that they don’t want to tell you about. In reality, if you knew about the problem you might actually be able to get more money.

So, instead of jumping at the request and immediately getting them the information they’ve asked for, consider responding by asking:

    Thanks for the opportunity… Is there a reason you asked about that product?

    Or Is there anything about what you have now that you don’t like?

Now, if there’s a problem, you might be able get them a product that works better. Or because you know they’re currently unhappy with what they have now you might be willing to go in at a little higher-margin (price). On the other hand if they are just giving you an opportunity, tell them you might not be able to beat the price but you could be within 1% of where they are now. If they’re not willing to accept a 1% increase, suggest that you can’t beat the price but that you could match it. Going in with an “exceed or meet price mentality” is much better than starting at a “beat price mentality” (in negotiations always start high).

Still, if they insist that you have to beat the price…you are at an advantage by having started with an exceed price or match price strategy/mentality. Now, you can more easily suggest that you would be willing to beat the price if they can give you one or two more items to quote. Remember, when you are negotiating, never give up anything without getting something in return! Getting a little more for what you sell over the long run could put a lot of money in your pocket as well as you companies. By changing your selling “beliefs” or thought process you’ll set new behaviors that will help you be more successful in sales!

Hurry...fix my sales problems!

            

I was on a coaching call yesterday with a sales person from one of our technology clients. As is often the case, he wanted all of the answers to his most pressing sales problems...right now! Although I was able to provide some advise that I knew would help, I was also quite sure that the same problem would probably occur again!

In reality, being more successful in sales and making the behavior modifications required is not a "quick fix" proposition. It requires hard work, discipline and a willingness to change. It also requires the application of three basic principles that drive higher success in all learned skill activities (selling skills are learned, not born!).

To understand these principles I often use the game of golf as an analogy. Being more successful in golf requires the application and commitment of these three basic principles:

    1. Play- Just playing the game more often will deliver better results.

    2. Practice- Practice in golf is done at the driving range or on the putting green. This is where we         take new skills and work to develop new "muscle memory".

    3. Learning and developing good skills- Taking lessons and getting coached, on a regular basis.

So, how would we apply these principles to the business of sales and could they improve our "sales game"?

    1. Play- In sales, the "play" is making sales calls (in person or telephone). Like golf, just making         more calls will make you more successful regardless of your level of skill! Remember, selling is         a numbers game, the more you try the more you'll win! 

    2. Practice- The practice in sales is something very few sales people are willing to do...role play! You         need effective strategies (created in the third element below) that are learned and well rehearsed.         When your prospect/customer says "your price is too high" that's the wrong time to come up with         an answer! Your role playing will create "muscle (response) memory" just like the putting green or         driving range in golf.

    3. Learning and developing better skills- Just like golf, you need to get "lessons" and be willing         to learn new skills or selling techniques. Most of the time, you need an outside influence to help         you make and identify what skills need to change. The old adage "if you knew what needed to         change you would have already changed it" is true.

So, if you're "in a hurry"...sorry. But if you are willing to apply these three principles to your selling career I'm sure you'll be more successful!

 

 

Is consultative selling really dead...or is the "Challenger Sale" the answer?

I read a blog post on the site of a good friend and business associate Dave Kurlan, rebutting an article that suggests "consultative selling is dead". If you'd like to read the article here is the link:

this article for Middle Market Executive

Although Dave has had a sales training business for over twenty years, he is also the CEO and creator of the OMG (Objective Management Group) Sales Assessment. His primary business has been to help companies identify and select top sales talent. Selling Dynamics has used the OMG Sales Candidate Assessment (for prospective new hires) and OMG's Sales Force Evaluation tools (for existing sales staff members) for over 15 years. Our clients have made fewer hiring mistakes and have been able to get better production from their existing sales staff.

I read the article and posted a response on Dave's blog which I have included here. Unfortunately, I think there is a lot of misinformation about selling that tends to confuse and mislead people. New selling programs are a lot like diets...new name same basic principles. Losing weight takes discipline and hard work, just like being successful in sales! In both instances, people are "hoping" for the magic formula that will allow them to succeed without either.

    I agree with you on this, Dave, and as you have stated I think the author takes liberty’s and     “defines” consultative selling in a very narrow context. Similarly, the authors of “The Challenger     Sale” do the same thing in the way they define relationships and “the relationship seller” along with     some other successful seller attributes. 

    I would think most savvy sales executives can see through this “repositioning” as what it truly is.     Sales training companies making somewhat outrageous statements that seem to defy commonly     accepted ideas (beliefs) for the purpose of attracting attention and “differentiating their offer”.     They are clever attempts that try to show that “the emperor has no clothes” for the purpose of     selling sales training. 

    Sadly, they perpetuate the myth that there is some “secret formula” that will make what is a tough     job (selecting, managing, training and coaching sales people) easy. We all know that developing a top     performing sales team takes hard work and effort and that most of the people selected for the job     are either unwilling and/or incapable of doing it. The panacea does not exist!

As a sales professional, you need to recognize that the formula for success is not a new program. The formula for success is having the discipline to consistently implement a program based on sound human behavior and sound communication principles. It must also include developing a supportive belief system, consistent activity and behavior management, guided by a selling model that can be learned and duplicated with consistency. We will continue to provide those components for success with our clients and their selling teams.

 

 

 

"Who breaks the tie...?"

I was in a "pipeline management" meeting with one of our clients, running what we affectionately refer to as a "bid scrub". These meetings are tough, but productive, and help to realistically assess the likelihood that we can close what has been bid. This was a new client and had not yet implemented our selling process... hence there was still a lot of "quote and hope" strategy at work!

Initially non-threatening, people catch on quickly and as they go "painfully" through each opportunity it becomes apparent why and how their deficiencies occur. Defensiveness can sometimes get in the way but people at the end of the process have a distinct advantage and leave with a much better handle on managing their own pipeline. In the end they recognize the futility in trying to justify what is often a weak position. In fact many have the good sense of starting out the story with "I can see I am missing a lot of information but I'll go ahead anyway" and accept the "beating" with humility. As uncomfortable as it may be, it is a vital learning experience that will ultimately help everyone be more successful, make more money and reach their goals (getting what they want out of life).

We were well into discussing one of the last opportunities when we ran into a problem. The deal was far along in the selling process and at the point where the sales person felt comfortable and had made an offer. There were strong buying motives, the project was budgeted and we had qualified the decision process and the people making it. With this information at hand the sales person felt confident enough to say this one is a "lock".

Some questions followed and we found out that there were two different groups with an equal number of people and slightly different agendas. I asked a question that had not been asked by the sales person, "what happens if there is a tie, one team votes one way and the other team votes the other way?". There was silence, and then the answer "I don't know"... followed by a sheepish look of confusion.

However,and with aplomb, the sales person quickly recovered and suggested that a tie would be "highly unlikely..." to which we asked "could it happen", followed by the answer "yes". Then, I asked "if there is a tie who breaks it?". More silence... which confirmed my concern that we had not covered all of the decision makers.

The lesson; when working with multiple decision makers we need to ask "what happens if people can't decide and there is a tie?" The answer will be "the real decision maker". Businesses are not democracies, they are monarchies and for that reason there is always someone who can break the tie. The tie breaker is who you really need to get to and is the "real decision maker".

Action Step- When selling to multiple decision makers ask how many people/departments are involved and if it is an even number make sure you ask the question "if there is a tie who breaks it?" It may be all you need to know to get the deal!

How do you handle the objection, “I just switched vendors on that product?”

I got a call a couple of weeks ago from an experienced sales rep with this question. It’s one I’m sure everyone has bumped into in the past and hopefully, after reading this post, you'll be able to handle it much better in the future!

I can imagine this would really “take the wind out of your sails.” You’ve got a great product that should be a good opportunity for this account, and you basically get “shot down before take-off.”  Talk about a buzz killer!

This situation could certainly be embarrassing, and underscores the importance of having a good selling strategy. We have discussed in the past and will continue to discuss the importance of trying to get your prospect to take the lead and identify a current situation, problem or “motive” that might get them to make some type of change in what they’re currently using/buying. Getting this objection would suggest that strategy was clearly not followed.

Looking for the “magic silver bullet,” the sales rep sent me an email asking how I would have handled this and what recommendations I would have for turning the situation into a sale. I suggested, “Apparently you've confused me with Moses!” Maybe he could part the Red Sea, unfortunately I can’t.

Consider for a minute your prospect’s situation. They just changed to a new vendor; went through the time, effort and trouble to make the switch, and believe they’ve made a good decision. Do you really think you have a snowball’s chance in hell to get them to change again? I don’t think so!

Now certainly you might respond with:

    “Thanks for telling me. I’m sure you’re probably happy with the  

     product that you’ve switched to.”

Assuming that they are happy with the change they’ve made, using an assumptive statement keeps you from criticizing their decision. However, if for some reason they’re not, this would be a non-threatening way to get them to identify that.

Interestingly, this would be a perfect opportunity to gain some intelligence on what is important to this account. Maybe the best question to ask at this point would be:

      “I’m curious.  What was it about the product that you were using

        that you didn’t like, and what got you to make this change?”

This would be a perfect opportunity to gain additional insight into what your customer is looking for. Was it a problem with product performance? Was it a problem with vendor performance? Was it driven by the need for lower pricing to reduce cost? Did they make a change to try to get better patient outcomes?

All of these are potential reasons that you want to uncover which could drive you to discussions on other products. Their desire to achieve any of the goals in the questions above is a clear “motive” and reason for change.

Some sales you win… some sales you lose, and some sales you’ve lost before you even start! I think this situation is one of the latter, but with some patience and a good set of questions, you can “turn lemons into lemonade” and get information that will allow you to be more successful with this customer.

Something else we need to consider is why were we not aware of this opportunity in the first place? Here again, you can’t get them all, but are you asking your clients about their regularly-scheduled product reviews? Again, good preemptive account intelligence will limit this objection.

I always appreciate questions from the field, and will provide strategies and tactics that may not get back what you lost, but put you in a better position to win the next round!

 

 

 

"Seduced by the big one... "

A few months ago (July), a good friend of mine shared with me that he had one of the biggest deals ever done by his company "on the tee". It was a monster, that would not only "make his year" but catapult him into "company sales history". It would take a lot of work, but in the end, be well worth it and provide the best commission year of his career. I was excited for him but worried that he might be "seduced" by the big deal and lulled into complacency. I asked how the rest of his territory was looking and he suggested "with this one in the bag I don't need anything else!" I bit my tongue and rather than risk our friendship kept my mouth shut.

Unfortunately, I've heard this story too many times and it almost always results in disappointment. First, our ego gets in the way and we are "seduced" by the notoriety we will receive when we land "the big one". Not to mention the ego strokes we get at the water cooler while bragging about the "mother of all deals". Second, it is human nature to think, with this big one on the line, we really won't have to worry about the little ones and it lulls us into a false sense of security and complacency. "I'm a big hitter now, why would I want to worry about all that little stuff? Besides, it's just as easy to close a big one rather than 10 little ones and takes less time.

So, what happens is we focus all of our attention on getting the big one to the exclusion of the little ones. In the end, what ever results occur, we're disappointed. Think about it... what are the possible outcomes?

1. You get the deal, make your year and after the celebration realize that your pipeline for the

next year is empty!

2. You don't get the deal (ouch!), and not only are you in trouble for this year, but that pipeline

for next year is still empty. Even if the deal comes in Q-1, you're in trouble.

3. The deal gets delayed, you look bad for the year, your first quarter stinks, you get fired and

your replacement comes in and gets paid when the big deal closes (talk about adding insult to

injury)! But, they buy you dinner and say thanks!

So, what do we learn? Selling is a numbers game that demands consistency and discipline... you have to be active and make calls. As much as you might be "seduced" into thinking you have found an easy way... sorry, there is no easy way. As soon as you think "you've beaten the bank" or "fixed the game" think again, there are no short cuts or replacements for consistent activity. To be seduced by the big deal and thinking that you have found your way out of "the numbers game" is a mirage. Simply put, sales success is tied to activity and thinking otherwise is suicide!

I just spoke with my friend and asked how the "big deal" was going. All I needed to hear was "well it's kind of a long story..." and I already knew what he was about to tell me. Is the story about to be re-written by you?

Action Step: Create an activity plan for yourself with a daily call goal. Don't let a day go by that does not include activity designed to make sales. If you find yourself with to many opportunities, we can handle that! We'll teach you to close early and relish in abundance! But don't get behind the eight ball and think you can stop calling just because you've been "seduced by the big one!"

Are you "committed to success in sales"?

The most successful people in any profession are usually the ones who are the "most committed to success in their chosen profession". Without real "what ever it takes" commitment, you'll end up in the middle of the pack doomed to be part of the 80% of sales people that do 20% of the business. You'll be an "amateur" not a true "professional" and your paycheck will show it!

To understand what commitment is it helps to look outside of our profession at examples of people that are truly committed to success in their chosen field. Being a Chicagoan, I need look no further than Walter Payton as a great example of someone "totally committed" to success in their chosen field. Walter was one of the hardest workers during the off season and that work paid off with not only great performance but durability few players have ever been able to match. Commitment to success goes way beyond "game performance" and relies much more on preparation. For sales people, this translates into "preparing" for the call and not just "making it".

"What is real commitment to the sales profession and how do I know if I have it"? Candidly, if you have to ask what real commitment is in sales you probably don't have it. True commitment in sales is the drive that puts everything else in your day "on hold" if it in anyway impedes your daily sales goals. I'm not suggesting that you become a martyr and make your sales career the "only thing in your life". However, during the day when you can be engaged in selling activities they must take priority over everything else (barring life threatening emergencies!). You've got to make a decision that you're willing to do "whatever it takes" (within legal and moral grounds) to succeed in your profession.

We'll talk about more commitment in future posts but part of being committed is finding things to do that will impact your performance and drive more successful results in your day to day selling activities. So,why not start today and identify something that you can do that can improve your results. If you can't think of anything specific, why not go back through some of the blog posts that I've written and commit to an action step that you currently don't take. Make it realistic, measurable, specific and you'll find your success will foster more of the commitment you need to succeed!

Action Step: Review posts on sales strategies and make a commitment to adopt a new behavior to implement and master.