March 31st, 2009 — Initial Communication, New Opportunity, Summary
I was having a discussion with a young engineer last week trying to advise her in her career path. She has a lot of drive and ambition, but is young (i.e. inexperienced) so she doesn’t have some of the wisdom that comes with graying hair.
I told her that the difference between an engineer and a good engineer is that the good engineer knows that they don’t know everything and isn’t afraid to ask for help.
I went onto explain that the difference between a good engineer and a great engineer is that the great engineer knows that he doesn’t have to know everything.
The same holds true for good and great salespeople. Don’t go into a call acting like you know everything, because you don’t. I’ve never lost a sale by saying “I’d prefer to conference with my technical team before I answer that if you don’t mind.” Go on to explain that you don’t want to answer incorrectly.
What you’ve proven is that you can be trusted, and whenever you say something as a fact, it should be taken as a fact. If you just spew out “Oh yeah, we can do that” and then you can’t – that breech of trust is next to impossible to gain back. And trust is what we’re all selling afterall.
March 24th, 2009 — Initial Communication, Propose Solution
OK, this is the last post in this little series. So far we talked about saving your customers life cycle money and making your prospects money and both seemed like weak positions in the current economy. So what’s left?
Save your customers money today.
Companies are looking at their costs on a monthly, weekly, and even daily basis right now and juggling receivables, payables and cash like never before. Layoffs and destroyed retirement accounts are on everyone’s mind.
What your customers need is a way to spend a little cash today that results in direct savings next week. That is how they can save jobs and maybe even their company.
So your sales challenge is to package and market your product/service in such a way that your prospect (1) can afford it, and (2) can use it to immediately save cash. (for reference, more sales for them does not equate to money savings – remember that).
This is a key idea and a key post for you to re-read so that you are not emptying out your sales funnel by using the wrong sales strategy.
Imagine you sell tooling to a tier one automotive supplier. Wow, you might as well give up, ‘eh? Well, what if you could propose them a new material that lasts twice as long as what they currently use and they only need to pay for your direct costs up front, so their cash outlay is actually less than the cheaper material and they have less change-over costs because your material lasts longer.
You cover your direct costs, so you’re keeping people working, and you can work out when and how you get the rest of your premium price.
This is no where near my favorite selling strategy, but I’m seeing it work time and time again for my clients in this crazy market, so give it a try and let us know how you make out.
March 17th, 2009 — Initial Communication, Propose Solution
In our previous sales strategy post we talked about the difficult sales approach of saving your prospects money in the future if they only spend more money now.
But what about instead of saving them money, you sold a solution that made them more money. That’s a sure bet right?
Well, it depends.
You need to remember that cash is extremely tight right now and even if you can make your prospect $1,000,000 in October if they just spend $50,000 in March; it is still likely that you will lose that sale. Your prospect probably doesn’t have the $50k to spend right now.
An example here may be if you sold a software package guaranteeing more and better visitors to a Website, thus generating exponentially more sales – but the development and installation will take several months to complete.
So now I’ve gone through two faulty sales strategies and there is only one left – save your prospects money right now, see the next post.
March 10th, 2009 — Initial Communication, Propose Solution
When you try to sell a prospect on something you are typically following one of two sales strategies:
- You’re trying to save them money, or
- You’re trying to make them more money.
An example of the first instance is a new lightweight material for the aerospace market. Everyone knows that saving a pound of weight equals some magic dollar value in life cycle costs for the aircraft. If your prospect would spend $x today, you’ll save them $3x over the 15 year life of their aircraft. Sounds great right?
The problem with that approach in today’s economy is the initial $x cost you are proposing is no doubt more than what they are currently paying. And at this point in time cash is king, queen and jester.
My point is that the sales strategy of trying to get someone to pay more for something right now in order to save them money in the future is a fool’s game when cash is tight, as it is for most companies right now.
That leaves two sales strategies in your sales tool box to keep your sales funnel full – (1) save them money instantly, or (2) make them more money right now – more on these to follow.
March 3rd, 2009 — Initial Communication, New Opportunity
Due to the rather weak economy, many of my contacts are in-between jobs, or at least nervous enough to be looking into other career possibilities – some as sales engineers, others in hard-core engineering or business management.
I’ve treated three people to lunch in the past month that are on the hunt for a new position. While I’m happy to do this and to help them out, the only time I hear from them is when they need help of some sort.
As I listened to what the perfect job for them would be, I proceeded to ask what they were doing to find it – all three said ‘networking’. While that’s great, if you only network when you need it, you’re doing yourself and your contacts a great disservice.
Listen, I’m an engineer as backward and uncomfortable as anyone meeting and greeting new people, but I do a little bit each week so that I’m never in a jam when I need it. 95% of my networking is unselfishly helping others – that is the secret of networking, there you have it.
So when I DO need something, I have no problem asking for help. I don’t mean to imply that I keep score and know who ‘owes me’, that couldn’t be further from the truth – I simply give unselfishly and get that back in return.
So get out there and reconnect with old friends and meet new acquaintances and start your networking with trying to figure out how you can help them – this is the best way to keep you sales funnel overflowing.
If you want to do something today, cruise over to LinkedIn and invite me to your network and I’d be happy to hook you up with anyone I can.
If you’re curious about my three lunch dates, I hooked one up as a managment consultant and the other two are still on the prowl. Maybe I should start a small job board on here?!
February 24th, 2009 — Examples, Initial Communication, Summary
OK, this is the first venting post of this blog’s history – but it’s very appropriate to our sales discussions so here goes…
We were in the market for a new bedroom suit for my little boy who is moving out of his crib. My wife found what she wanted at Value City Furniture. Unfortunately they have no options to do anything over the Web (sales mistake number one), so she had to call to place the order for a bed, mattress set, end table and dresser – I’ll explain later why she can’t get to the actual store.
They told her that they aren’t allowed to take orders over the phone because of credit card issues. What??? I can pay for a bloody pizza over the phone! (sales mistake number two)
So now I have to run to this store with my 2-year old to order the bedroom set. I tell the salesperson, Bruce, that this was very inconvenient for me and asked him to explain why we couldn’t order over the Net or at least the phone. His response was that the “Privacy Act” prohibited them from taking confidential information over the phone. He stated it as such a fact that the President himself must have signed this Act into law. What???
He then made his major mistake and said that it isn’t a big deal to come to the store and it isn’t really inconveniencing me much. Now, what Bruce didn’t know was that my wife had been in the hospital for several weeks due to pregnancy complications and I was running ragged back and forth with work, daycare, and daily trips to the hospital with no family around to help – so this was a major, major inconvenience for me. (sales mistake number three)
He finally goes to ring me up and proceeds to tell me that his computer will only let him enter single unit sales and since I was buying a set, I had to go through the customer service department. What??? (sales mistake number four)
Since I’m extremely short on time at this point in my life, my only punishment was to not order the mattress set off of them. If I had more time, I would have blown out of that store completely.
So what can we learn from Bruce? Plenty.
- Make it easy for your customers to order your goods through a variety of outlets.
- Make sure your offerings are at least as easy to order as your competitors are.
- Don’t make a mistake and assume anything about your customer because here is where you can mess with their deep emotions and really screw up a sale. So stay away from politics, religion and things like that.
- Never tell a customer that you can’t take their order right now. If all else fails, write it down and enter it in the system later, but don’t pawn them off onto someone else to deal with.
Maybe we can start a list of our readers vents and put them together to deliver to sloppy salespeople that give us all bad names.
February 17th, 2009 — Initial Communication, New Opportunity
I was trying to convey the idea of knowing when you are really at the true pain or sales emotion of a prospect. I used the following example which seemed to really hit home.
Imagine this same question with only a single word changed – and how that single word changes your answer over a rainbow of possibilities.
Question: Would you die for your X?
- Pet? No way, I love my beagle, but a dog is a dog when my life is on the line.
- Friend? Nope, sorry Bro.
- Siblings? Hate to say it but probably not, I have a family of my own to worry about and can’t leave them high and dry with no support.
- Parents? Call me ungrateful, but most likely see #3.
- Spouse? Yup.
- Children? No question, bring it on.
Do you see how we went through a sequence until we reached a point of no return – ok, so now you need to craft your pitch around my little buddies and my darling wife. That is where my deep passion lies. Anything else you’re wasting your time.
Our job as salespeople, is to ask the right sales questions in the initial sales call so that you know where my needs and pains really are. My needs may be broad based (say life insurance), but my pain is centered around my wife and children.
Bottom line: I don’t care what you’re selling, the person sitting across the sale’s table from you has a few key pains that you need to uncover. Ever run across a buyer that needs to close a deal by the end of the quarter or they lose their job? Dig, dig, dig.
February 10th, 2009 — Account Maintenance, Examples, Initial Communication
While on a recent outing to Home Depot, I happened across the line of Dremel products and a big sign caught my eye. It was a 1-800 customer service number that you could call right there in the store!
So if you were looking and had any questions at all, you just dial them up and they advise you on what Dremel accessories you might need.
Now I don’t have to tell you what that would mean to the salesperson going to pitch larger shelf space for Dremel’s products. A typical question that purchasing agents at big box retailers ask is “How will you support our sales efforts” (they are looking for what type of marketing you’re willing to do and then make you pitch in to pay for their ads – but that’s a different subject). How awesome would it be to answer, “How about if we give your customers live 24/7 access to our customer service department so that all their questions are answered right here in your store?”
Most of us are not fortunate enough to have such a customer service department as this, but what can you do to get closer to this goal? Well, I suggest talking to your customer service department if you have one and relate this story. Tell them that you realize they are stretched so very thin already, but this display was so motivating that you were hoping to work with them to install some systems that might get you closer to this.
If going up and asking these questions makes you uncomfortable, you must not have followed our previous recommendations to integrate with the CS department – so start now.
I pinged Dremel’s customer service department for a quote on their basic customer service philosphy several months ago and never got a reply, puts a bit of a stain on my theory of their busines model.
February 3rd, 2009 — Summary
We’ve all been through them; the company sponsored training programs designed to improve our sales effectiveness. But have you ever stopped to see if they’ve really helped you?
One effective way to do this is using your performance management process.
Most training programs focus on trying to improve a few particular competencies or skills. To track your progress in honing those skills, check the performance ratings you’ve been given over the past few years. Have your ratings improved both overall and on targeted competencies? Review your progress year-over-year. If your ratings aren’t improving, you need more development.
Another way to check and see if your selling skills are at their peak is to solicit feedback from others. Multi-rater or 360 degree feedback processes are an excellent way to get feedback on your performance from other people. Even if it isn’t a formal part of your performance appraisal process, you should seek out feedback from others. In certain circumstances, I’d even recommend getting feedback from your customers, although you really need to be careful here. The point is, you can always learn from someone else’s perspective. If they have a safe way to deliver the feedback anonymously to your boss or some other third party, getting feedback from peers, co-workers, and other folks who work with you on a sale can really help you get a clear picture of your strengths and weaknesses so you know what to work on to improve.
Automated Performance Management Tools Can Help
As engineers, we love tools! We love anything that saves us time and improves our quality and efficiency. OK and there’s the “sexiness” factor too. Let’s face is, technology is fun! There are some really great automated performance management tools out there that can make it easier for you to get the feedback you need and monitor your performance improvements. Your performance appraisal should be one of your key tools for getting feedback and monitoring ongoing improvements in your performance. If your company doesn’t have an automated system in place yet, maybe you could develop your sales skills by selling the need for one to your HR group!
January 27th, 2009 — Examples, Summary
The Sales Funnel metaphor has its roots in the real world use of funnels. A large amount of liquid, or sales opportunities, can fit into the top wide portion of the funnel. However, as you move down toward the funnel neck, less and less opportunities can fit.
A sales funnel is constructed by stacking several layers together. These layers include:
- New Opportunity
- Initial Communication
- Fact Finding
- Develop Solution
- Propose Solution
- Solution Evaluation
- Purchase Order
- Account Maintenance
The key to surviving in sales is to make sure that each respective layer in your sales funnel never dries up – it really is that simple. You should always know how many companies are in each layer. New Opportunities are put in the top and worked through the funnel (via a documented sales process) until they either issue a purchase order, or become a disqualified lead.
Knowing that it can take weeks or months to walk prospects through the sales funnel process, you better have multiple prospects at all layer in your personal sales funnel.
So the bottom line is pretty straightforward. Make sure that you have action at all levels in the sales funnel and you’ll never be desperate for a deal to close again.
January 20th, 2009 — Examples, Summary
Over the past two years, I’ve been developing an Excel based sales tool to automatically create sales funnels for my team and clients. As we saw in the proceeding sales funnel example post, sales funnels can tell you a lot about your business.
This sales tool allows you to:
- Focus your efforts and make more money
- Better track your current and future customers
- Identify and secure repeat orders from current customers
- Never be desperate to close a deal again
- Identify top performers in your sales organization
- Determine which customers aren’t worth your time and effort
- Provide more accurate and timely forecasts
- Stop wasting time preparing sales quotations on loser sales accounts
After seeing many salespeople successfully use this in practice, I’ve decided to offer it for sale to our readers. A quick look at the directions should help you decide if this would be useful to your sales efforts and how to properly make a sales funnel.
If you have any questions, please ask in the comments so that all can read the response.
January 13th, 2009 — Examples, Summary
It seems an appropriate time to look at an actual example sales funnel that we recently analyzed. Let’s call our salesman Sam since Sam the Salesman has such a nice ring to it.
A quick glance at Sam’s funnel reveals several observations, some good, some not so good.
- Sam’s New Opportunities layer stands strong at 15. So Sam either has a fantastic marketing department that is feeding him a lot of leads, or Sam is great at uncovering his own leads. What we don’t know yet is the quality of those leads.
- There is a large step down from New Opportunities (15) to Initial Communication (3). Something doesn’t smell right here. We need to talk with Sam. He either needs retrained on how to get in touch with his prospects or we need to help him get better leads.
- The relatively low values for Fact Finding through Purchase Orders continues to point to a problem of converting prospects into customers. Is it Sam’s fault? We can’t really tell without talking with him. But we sure can tell that something is wrong somewhere.
- Ah, ha – look at the high Account Maintenance number (12), that’s downright fantastic! Right? Look closer. With the large number of current clients, why doesn’t Sam have much more repeat sales in the upper layers? We’ve hit on a problem. Even if his new leads are garbage, he should be able to churn his current clients back through the sales process at a much greater rate than he currently is. This is where his efforts need to be focused.
This is the type of process you should go through on a monthly basis to make sure you have deals at all levels in the funnel and you don’t go hungry. In practice, Sam would couple his funnel with a brief document detailing each company in his sales funnel.