Who are we selling to anyway?

Do you have a clear picture of who your customers are?

In a discussion the other day with a group of people putting together a proposal for a retail company it struck me that even large, reputable companies in some cases get lost in the woods. Then they run into a candy cottage and think they’re on to a good thing. The company in question was doing well and getting lots of browsers. They were looking to get more people into the store by offering an enhanced experience. So far so good. What did they have in mind?

“Well they want people to enjoy spending time in the store so we are considering various fun activities such as using the game consoles, book reading corners with beverages, play spaces for kids… “

I was expecting “shoulder massage while waiting to pay” to creep in somewhere. Why?

“What do you mean why?”

Why are they looking at this shift, change, transition or whatever you want to call it?

“Well, people are walking in but they aren’t buying stuff”.

And this will be remedied by rewarding browsers just to be browsers?

“…”

Then we got to talking about how the company is branded. Is it branded? What do you think of when you see the logo? And please note that this is a successful retailer with a dynamic approach to doing business. So how did we get to the point of examining what meat lockers we need to install without determining how many of our customers are vegetarian?

It all boils down to knowing who your customer is. In some cases you should also be looking at which customers you are attracting? Are they the same as the ones you are targeting? If not, which way do you go? How strong is the brand? Is it strong? Has work gone in to building it? What are you changing and why? The fact is that in real life there are loads of companies that start a change initiative without taking a good look at the facts and figures. In an unbiased manner. With an open mind. And if the figures aren’t there, for God’s sake get some. Who is your customer? Who do you think your customer is? And who are you targeting? Impulse buying came into the conversation. Then it went downhill.

So you are targeting customers with enough disposable income to embark on impulse purchases by offering free pastimes in a pleasant and accessible environment with free beverages and use of facilities?

I got a few looks and changed the subject. There was really no reason to walk out of the room having created a bad atmosphere I wasn’t being paid for.

But do stop to think: what are you selling? To whom? If it’s working, instead of trying to change it, find out why it is working and enhance it. A Captain not willing to change course is more likely to crash into the rocks than the one that sees an unexpectedly favorable passage and follows it.

 

Sell hard

In the die hard movies, the guy just doesn’t give up. The same should apply to sales people. They should never give up. But. There’s always a but. There’s a difference between working hard on a sale and hard selling. Hard selling is dead. Some sales reps do not want to accept this. Most everybody else was glad to bury it. Influencers, decision makers, managers, you name it, nobody has the time for hard sellers any more.

The hard seller is the sales rep that lives by the belief that they can sell ice cubes to people living in areas adjacent to the polar ice caps. This is the person that you will buy from only to get them out of your life. If it’s a once off sale. “Yes! OK! I’ll take the printer!” and then in the privacy of your own mind “Just as long as you go away and stop bugging me!” The hard seller is the sales rep that that always knows better and believes that he can break your will not to buy. It gets personal and somewhere along the line it’s becomes a contest. And nowadays buyers just don’t have the time. So if you are looking to lose sales, keep the hard sellers in your sales force. As mentioned previously, hard selling kills opportunities. And an opportunity is a terrible thing to waste. Believe me, buyers have developed antibodies for hard selling, similar to anti SPAM software.

Not the way to sell

So the modern sales person uses more sophisticated techniques. They are trained to ask questions. They uncover needs and wants and pick up on motivators and, guess what, the hard sellers are back! Let me recount a personal experience. I was sitting in my office waiting for an acquaintance from another time to turn up when he did. After the pleasantries he mentioned that he was now working for an insurance company. Yes, really, totally different to what he was doing in his previous position. He was in Sales at that. And then he pulled out a laptop. My polite smile froze. He opened it and turned the screen towards me. The PowerPoint was already in slideshow mode. Complete with logos and a corny wannabe catchy title slide. Then questioning technique started

“Wouldn’t you like to know that no matter what might be wrong with you, somebody has you and yours covered?”

“Well, actually…”

“And how would you feel if you could choose any medical facility in the world for your health needs, whatever they might turn out to be?”

“Look, John, I think…”

“Good. You should always be thinking about your health. When was the last time you had a physical?”

The guy just wouldn’t stop. He explained over the coffee, I was no longer happy to have offered him, about the merits of colonoscopy with what I felt was more attention to detail than necessary. In question mode. “Have you ever seen the probe?”, “Have you ever wondered if you are conscious during the process?”.

The technique was in there somewhere. He was asking questions. But he wasn’t paying any attention to the answers or to my reaction or body language. Plus, he didn’t mention during the long-time-no-see phone call that he was actually making a sales call. His fault? No. His manager’s. Or the maybe the consultant that trained the sales force was to blame. Or both. This was hard selling in  sheep’s clothing. Which made it worse. At least the other type comes at you both guns blazing. This was sneaky and had an even worse effect. At some point I began to feel that my intelligence was being insulted. After the first few questions I pointed to the sign on the door. “John, the sign says “Sales Manger” for Pete’s sake. He still didn’t get it. After going through the motions he ended up with a triumphant slide that had a figure on it. “Am I buying insurance, or part of the company?”

“Surely this is an affordable amount for somebody in your position”. He was now making assumptions on my financial status. And it was all part of the misbegotten, misguided training he had received at some seminar called something like “Increase your sales, guaranteed or your money back”.

The point here is that if you want your sales people to be successful, think like a prospective buyer. Sales techniques are meant to be used as facilitators not to be practiced religiously without straying from the path. You need to be listening to your prospective customers, who by the way have done you the favor of taking the time to listen to you, and you need to be hearing what they have to say. Then you need to ask more questions and then you need to decide if you can genuinely satisfy their needs. If not, you need to be mature and honest enough to say so. Then you have gained their respect, the right to call on them again and maybe even a referral. Because you have integrity. If you do believe they need what you are offering, then proceed. Find out how you can tailor your solution to fit their need. Sniff out what they would change if they could. And have an intelligent conversation. Otherwise you are not building a lasting relationship. You are reminiscent of professionals of an adjacent discipline and your discussions are the same as their lines: untruthful and just part of the script.

 

What a brilliant presentation! Don’t call us we’ll call you.

We’ll be in touch…at some point

When your sales people say they are making sales calls, what are they actually doing? The assumption here is that your people are in fact putting in the road hours (are they?). Even if they are on the road and visiting customers, many sales people tend to set (if any) vague call objectives. Nowadays it is becoming crucial, wherever this is not endangering the sale and of course without becoming pushy fridge to Eskimo type sales people, to reduce the closing time of our sales. We simply can’t afford to wait as long as we could four years ago for the prospect to sign. The key phrase here is “efficient planning”. This requires sales persons to set targets for each sales call. Just booking an appointment and playing it as it comes once we sit down in front of the customer to be, was never a best demonstrated practice but under today’s circumstances it is criminal. Time is a resource and this is no time to be wasting resources. Customer facing time is a valuable commodity and not a minute of it should be squandered. On the sales person’s side, their company has probably made cut backs so that they are doing more with less. Maybe sales support has been trimmed; maybe some of the lagging sales reps have gone the way of the dodo. Whatever the case, time is money. The same applies on the other side of the desk so prospective clients will appreciate professionals who don’t waste their time.

Make sure that your sales people, especially the less experienced, can rate the success of a sales call. According to one school of thought a sales call always results in a sale: Either you sell them a product or they sell you bull. The more scientific approach is that, barring an outright rejection and the equivalent of a kick in the proverbial, there are two possible outcomes: A continuance or an advancement. In the first case the customer may comment favorably on the presentation, the sales pitch, the excellent brand name and so on, but doesn’t commit to anything. The rookie sales rep feels good leaving the customer’s premises and is satisfied with a job well done. The seasoned sales person recognizes the continuance. The whole process has been pushed to some vague point in the future. What the rep should be aiming for is the advancement. Some deliverable that brings the closing phase that little bit closer. This could be a meeting with the CFO, a request for specific prices or referrals etc.When planning their calls, your sales people should have in mind what kind of advancement they are aiming for, and then go out and get it.

So, are you selling or being sold?

 

On assumptions and lost opportunities

Stop assuming and start digging

When I was a kid (all those years ago) I saw a comedian advising his audience never to assume because “when you assume you make an ass out of u and me”. He was right about the assumption part anyway. It is particularly dangerous in a rapidly changing environment to make decisions or act based on unfounded assumptions. This is especially true when talking to sales people about opportunities. It is especially especially true if the discussion refers to existing customers or opportunities that have been examined in the past. The basic message here is that everything changes.

“Have you spoken to client X about product Y?”

“They don’t need it”

“How come?”

“We discussed it last year”

This is the trap many sales reps and even their managers fall into. The point should be that we don’t reject an opportunity unless we can swear on whatever holy book or relative’s final resting place that we have followed it up, revisited it or looked into it and we are sure beyond a reasonable doubt that there is nothing there.

The other common assumption is that existing clients actually know what we sell. Customers build up an image of their suppliers and in many cases don’t even consider them for services or products that for some reason fall outside the scope of what they have come to conceive as your range of offerings. You need to talk to more than the usual contacts in companies and gain a thorough understanding of what they do and which suppliers they use, namely your competitors both direct and indirect. You will be surprised by the number of times you will receive answers along the lines of, “I didn’t know you guys did that!”. These days, in many cases the lines between direct and indirect competition are blurring as companies adapt and become more elastic in their effort to increase share. Throw in commoditization and a reality check and you may be opening up a whole new world of opportunities. How wide is the line that separates two market segments? Can you turn a boundary into a continuum?

Make sure your sales force has disabled preconceptions before they visit prospects. Get out on the road with them and lead conversations that uncover possible hidden opportunities. Give a fresh perspective. Then let them follow it up. They should then go out and emulate this in their own way. Hey! A coaching ride! Stress the importance of meeting with different people in your clients’ organizations. New acquaintances will, most probably, not be familiar with your offering and may well be in other departments that you can cater to with an additional product or by adapting one to their needs. Another assumption you should stop making is that everybody in a client company (especially the bigger ones) is talking to everybody else and knows what is going on three divisions down the road. If your service is something of a commodity, don’t assume that top management actually knows the details. You need to take the differentiating factors to them.

Stop losing opportunities because of routine thinking.

 

On customer satisfaction

Make sure this is the digit they raise

What makes for a satisfied customer? When do you feel satisfied as a customer? When are you not a satisfied customer? It all boils down to good old expectation management. What have you led your customer to expect? Or even worse, what are his or her default expectations or preconceptions? It is so easy to become customer critics instead of customer advocates. “Oh God! it’s Mr. Jones again! He’s such a royal pain!” and so on. This is not the time for such behavior. People are angry with the downturn, with shrinking incomes, with bad payers, with increasing running costs and cost of living. It’s so easy for them to add you and your company to the anger list. Don’t give them reason to. So, manage the expectations. If you sell dirt cheap and have a crappy service, then advertise this fact. People expect not to expect good service and they walk out so happy with the bargain they got. If you buy something for ten dollars and its value turns out to be ten dollars, you are most probably not a satisfied customer. At best you are a neutral customer. Paid ten, got ten. Nothing to post on the social network about (my first, outdated impulse was “nothing to write home about”). If on the other hand the value turns out to be eight, then you are a peed off customer. Depending on your character you may be a letter writer or a lawyer user or a thumper of fists at the front counter. Or maybe you just take your business elsewhere in future. Take your pick – they are all loss makers. And nowadays word of mouse is much stronger than word of mouth. One click and the whole world knows about it. Welcome to the wonderful world of antisocial networking. Finally, on a brighter note, we have the case in which you pay ten and for some reason the value you get is twelve. Your expectations have been exceeded. You are now a satisfied customer and net promoter of the company that went the extra mile, click or even smile for you. Yes, even a polite smiling employee at the counter can make the difference in the value received.

Manage your customer expectations. If you really want satisfied customers you need to create the correct expectations and then exceed them on the deliverable. And remember, you can do it even by proactively notifying a customer of a problem with their purchase. Most of all, we expect companies we give our money to, to act responsibly.

So walk the talk.

 

What sales plan?

If you plan to sell, sell to plan

When talking with small companies (and some not so small ones) It never ceases to amaze me how little concentrated effort goes into Sales. What is even more surprising is the fact that this also occurs in organizations with reasonable earnings. So I have come to soundly believe that mediocrity will indeed ambush excellence nine times out of ten. This, I feel is a factor contributing to the deep… hole many companies have found themselves in during the past four years or so. If you are getting along, why rock the boat. “We’re in the green”, “We’re not out to dominate the market”, “We don’t expect miracles”, are common answers from people asked (pre-downturn) why they are not pushing for more sales.  “What do you expect in these conditions”, “Can’t you see what’s going on out there?”, “There’s no growth left”, are but a few sales reps’ responses to the question “Why aren’t you selling more?”. Put the managers giving the first set of answers in the same company with the sales people giving the second set and you might as well call it a day and go home before the debt becomes unserviceable. Entrepreneurs are those alive go-getters. The when-the-going- gets-tough guys. The “we’re doing OK” guys are simply not entrepreneurs. Like I said, excellence has very slim survival chances in a mediocrity infested environment.

The first thing you notice is the total absence of planning. More specifically there is no sales plan. No matter whether there is one, two, ten or a hundred sales reps in the company you need to have a sales plan. The company’s revenue and profit is built up from the bottom, sales territory by sales territory. It depends on all sales people delivering on target. Admittedly, most companies do have sales targets. They are handed out in a top down fashion without any attention to what are supposed to be the constituent parts. Someone upstairs decides on the figure and then the sales force is expected to miraculously deliver it. Then once a quarter there is some sort of sales review where sales people are chewed out over their results and the target is upped to cover the gap. Come on, guys!

Sales management is a rather complex and specialized discipline. However, you don’t have to be a guru or have thousands in software to be able to put together a serviceable sales plan. For a company already selling something, it’s a matter of going territory by territory and then customer by customer. What is their performance? What is their potential? Are they splitting with your competitors? Are they growing, shrinking, going belly up? Are you selling them everything you can? Do you know everything they need? Once your sales people put your customers under the microscope, then they can make informed decisions about what sort of revenue they can pin on them for the next period. Some will be up, others will be down, a few may be lost. The result should show where you stand in relation to the target (which has been shared across the sales territories depending on their potential. People then know how much new business they need to drum up to make target.

Find a way that works for your company, but get a sales plan in place. Otherwise  you are just taking pot shots in the dark. And more often than not they miss.

 

How much?

Sell on value, not on price

How many times have you entered a sales call, shook hands, sat opposite the prospect and then got shot in the face with “What’s this going to cost me?” or something along those lines. Talking to a free lancer friend of mine the other day, I realized that the instinctive reaction is actually  to blurt out  number. In some cases I have coached sales reps that not only give a figure but also proceed to apologetically justify it. If this is your instinct, DON’T FOLLOW IT!

Nowadays, managers and business owners, the people you should end up selling to, are busy and possibly harassed by sales reps. They have heard it all before and either know what they should expect to pay, or think they do. Even if you are selling on price and you are confident that you are the cheapest, don’t try to blow them away with your rock bottom price. The buyer’s instinct is to knock you down a few notches.

So, here is one of the rare cases in sales for which there is a golden rule which is also black and white: Never start your pitch with a price. Whatever you say, the response will be something along the lines of, “That’s way too much”, “Your competitor Blahblah Inc. just gave me a much better offer”, “That’s too much for our budget these days” and the list goes on. If you are in sales, then I’m sure you can add another three or four without batting an eyelid. And, by the way, the person opposite you will be right to respond this way. You didn’t take a second to build up the value of what you are selling. Why should they assume it exists?

When confronted with the how-much question, brush it aside. One response could be, “I’m not here to quote a price. I’m here to build a relationship. If we can agree on everything else, I’m sure we will agree on the price”. Something like that. You should then proceed to go through your well rehearsed presentation of the benefits he or she will receive by choosing your offering. Highlight the efficiency it supports, the economy inherent in it’s use and sketch a picture that shows the long term benefits which, of course, by far out-weigh the number at the bottom of the invoice.

Remember, if you don’t build up the value in the prospect’s mind, whatever the price, it will always be too high.

 

How do you measure your sales force?

From a physicist’s point of view, a force is any influence that causes an object to undergo a certain change. So, how effective is your sales force in influencing prospects so that they become loyal customers?

Many companies have sale forces. Some companies use them properly. A sales force is a terrible thing to waste.

Do you know your close ratio? Is it all you expected?

In the case of medium or smallish operations, the sales force has probably evolved from an ancestor that doesn’t necessarily resemble or preordain its contemporary descendant. Think of dinosaurs and birds. Who could have known…

So maybe the founder acted as sales rep as well as sales manager and everything else. Perhaps one of the original partners had an inclination towards sales and adopted the role. It is conceivable that some junior person was actually hired to run after sales (and I use the phrase literally). A sale would be made and then somebody had to run after the details. In any case, companies grow and then maybe somebody else is brought on board and before you know it the top sales person has been named sales manager and, if you are lucky, sales meetings happen. This, believe it or not, is not the way to set up and run a sales force.

It doesn’t matter how it started. People running businesses make decisions and often have to make do with whatever or whoever is at hand at the time. If you are successful, i.e. you are making more than you are spending and are experiencing more sales that you were this time last year, you are probably doing something right. Rule no. 1: Don’t take it for granted. There are so many reasons that may be the root cause of your success; you are a business genius, your competitors are useless, the customers you gained, liked you more as a person, the customers you gained were seriously peed off by the other guys, sheer chance… the list goes on. If you can not face your mother and without a hint of a blush tell her that you are the reason for your success, than you are well on the way to achieving your goals. If you are not 100% sure, substitute the ego trip with some good old-fashioned analysis and lots of time face to face with your sales people and customers.

Your sales force should be as big as it needs to be. Not bigger, not smaller. You need to determine the type and size of your sales force. What is the size of the market you are targeting? What sort of share do you realistically expect to gain and by when? Where are your customers located? How do you serve them? How many sales people do you need to create break – even sales?

Everything becomes easier if you spend some quality time learning about structured sales. This is where you stop leaving things to luck and “talent” and start building a sales infrastructure that supports a sales force that knows its targets, gets measured against them and delivers on them.

What you need to look at:

1. Sales force structure
   1. How many sales people?
   2. Who looks after which customer?
   3. What are my sales channels? Key accounts? Telesales?
   4. What skills do my sales people need?
   5. What type of sales persons do I need?
   6. What type of sales organization do I need?
2. Sales force infrastructure
   1. How do I support my sales force so that most of its time is spent face to face with customers?
   2. How do I manage the sales pipeline? (do we know what it is?)
   3. What software do I use?
3. Sales force performance
   1. How do I measure sales force effectiveness and efficiency?
   2. How do I make the sales force passionate about achieving targets on all KPIs?
   3. What are the KPIs?

When sitting down to tackle this crucial subject, always keep in mind what is driving your business. What is that single crucial KPI that threatens to give you an ulcer if it isn’t where it should be and makes you want to kiss people in the office when it is? Then communicate to the sales force what is expected of them and get them to go about achieving it.