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The Value of Key Performance Indicators for Tracking Sales Growth

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Too often when looking at a sales team’s success, managers only focus on the actual sales — aka the closing of the business. Of course this is important, but the sale is a lagging indicator. If you have no sales closing today, it indicates that your team hasn’t been performing well for months. By the time you’re at the stage of no business, you’re already well into trouble. In fact, you’ve reached the point of no return.

So how, as sales leaders, do you create leading markers that track the behaviors required today for successful sales tomorrow? The answer is Key Performance Indicators (KPIs). KPIs are important leading indicators that ensure you have a healthy pipeline and future business. They provide an objective form of measurement that allows you a glimpse into your future — before it’s too late to change direction or solve issues with your team.
 

The top three KPIs

The first step in determining which KPIs to measure and how to gage them correctly is to differentiate between a sales pipeline and a sales forecast — two terms that many sales professionals mix up or don’t distinguish between. A sales pipeline provides clear visibility into all of your opportunities, regardless of their probability of closing, whereas a forecast is a subset of the pipeline that only includes those qualified opportunities that are expected to close in a defined reporting period.

A properly-defined pipeline and its stages help you organize your sales process and create effective tools and benchmarks for your sales team, making it much easier to predict the future success of your sales force. In fact, by using KPIs it’s possible to get within five percent forecast accuracy, meaning that you’ll always know not only how your team is currently performing, but also what roadblocks might lie ahead.

A sales forecast is a forward-planning tool for budgets and spending, and measuring KPIs around lead conversion success — such as the cost per lead — can help you budget appropriately as well as accurately predict your revenues.

The three KPIs that every sales team should measure are:

1.    Early-stage KPIs: Indicators for opportunity development

·         Number of qualified leads in the pipeline

·         Sales cycle length

·         Total length of time to qualify a new prospect

·         Qualification to proposal ratios

·         Number of evaluations/short lists per year

·         Number of new (first) client meetings per month

·         Cold lead to qualified ratios with conversion rates

It’s important to not only measure your opportunity-to-close ratio but to measure conversion from stage to stage, which may be a new concept to you. Keeping an eye on the length of your sales cycle, the number of new client meetings you have each month, and the conversion ratio of new leads to qualified leads, will provide insights on whether you will be ahead or behind on future revenue. And how you can best adjust now to ensure you’ll hit your future revenue goals.

2.    Late-stage KPIs: Profit and quota-focused measurements

·         Proposal to closed ratio

·         Average deal size

·         Number of sales per year

·         Annual quota

·         New vs. existing client sales

 

3.    KPIs for account management and client retention/growth

·         Average client growth year over year

·         Client retention rates

Depending on your business, you may have additional KPIs to take into account. A product distribution company, for example, might measure target margins versus actual margins achieved on a per product basis. A parts manufacturer with a supply agreement in place might measure the estimated annual value of the supply agreement versus the actual parts ordered on a monthly basis. Software as a Service companies would measure average contract value and average length the client stays in the program.

Be objective and use data when establishing KPIs. Each should have an appropriate benchmark based on actual data and information from your sales history or benchmarks from the industry if you’re a new startup. Review your sales from prior years or quarters to help you calculate averages and quotas. Understanding your average deal size and combining that with your lead conversion rate will give you an idea of how many opportunities need to be in the pipeline in order to hit your quotas in a very objective and scientific way.

 

Stay on top of weekly indicators

Of course, measurements are only helpful if they’re paid attention to. Get to know your KPIs and review your data weekly. Pay close attention to any trends — both worsening and improving — so you can react appropriately. It’s helpful to include your sales team in this process. Review each person’s KPIs once a week in a coaching session. This will help them to understand the types of behaviors that are important and will ensure that you spot any lags in performance early and can course correct quickly.

No one likes to be blindsided by poor sales, and there is no reason to not see what’s coming! There are few opportunities in life to accurately predict the future, but paying attention to leading indicators now is an opportunity not only to predict, but to change the future course of your sales. 

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Marketplaces Without Boundaries: Creating Communities in Today’s Sales World

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Today’s marketplace is in the midst of a profound transformation in how sales are generated and sustained. And nowhere else is this more apparent than in the changing relationship between sellers and buyers.

Gone are the days of pure transactional selling. Buyers don’t wait for you to come to them anymore. Instead, they seek out what they’re looking for. When they’re prepared, they choose to do business with those who best meet their needs. More than ever, the strength of the connections you cultivate determines how successful you’ll be in positioning yourself in the minds of your buyer as that top pick.

Let’s discuss how you can act on opportunities in the marketplace today. Also, let’s explore a valuable case study that underlines how this new approach can translate into steady sales growth.

Build relationships within communities

If you look at the current selling landscape, you could say it resembles the rise and success of the modern farmers’ market. These operate on a small scale across multiple communities and thrive on local connections. You see your neighbors all the time, which is community building, and vendors all promote each other through a rich network of selling goods and services. For example, the local heritage pig supplier recommends buying tomatoes at another farmers’ market up the road for a delicious sauce to compliment the meat. Or the bread maker tells customers that the cheese and jams of the neighboring vendor are second to none. A buyer can confidently find what they’re looking for in these networked communities. And the seller’s work and reputation is measured by how useful they are to both the marketplace and customers.

In other words, success at farmers’ markets hinges on relationships.The same is true of today’s selling landscape. Communities are where relationships get forged now, and to be part of a community means to put in the time to share what you know so that you help something meaningful grow for the benefit of others.

Seek spaces, not places

It’s not just about closing the sale anymore. And it’s not about telling others to follow you as leader in a monopolizing way. Today’s marketplace without boundariesmeans that buyers from the four corners of the earth can find what they’re looking for in spaces where people congregate. I’m choosing my words carefully here: I’m talking about spaces rather than places. Spaces don’t occupy a fixed location, nor do they have limits on who can join or what they can contribute. Spaces can be created online. They can be found in professional associations. And they can be forged in the content that you create for others, addressing topics that people are thinking about. By occupying spaces, you’re creating a sense of kinship and shared purpose.

Out of this, communities are born — and with it, a sense of permanency and socially-tested credibility that provides the potential for perpetual sales growth, month over month, year over year. When managed correctly, it means an end to the boom-bust cycle of sales, because unlike the old way of doing things, communities are populated first and foremost with people, not buyers.

The four groups to establish

To adapt and grow a sales force that can thrive in a marketplace without boundaries, there are four types of communities your organization needs to build and sustain. Each of these should be a formalized part of the platform that you create to offer to prospects and customers.

1. Intelligence communities:Information and field-tested insight are highly valuable commodities in today’s marketplace. People are hungry for good ideas, and that’s why it’s important to share what you know. When I say this, I don’t just mean on a personal level; this applies just as much to groups of people you manage. Today, many businesses are building intelligence communities to better engage their prospects and customers. They’re posting videos, publishing case studies, developing whitepapers and e-books, and posting fresh ideas to their blogs. The content that you generate has more than just “new release” shelf appeal today. It also creates a valuable backlist — just like a publisher (who, it’s worth noting, generates a significant percentage of their sales in this area). The more you add to your knowledge backlist — especially if you post your content online — the more valuable the information becomes for your audience today and in the future.

2. Specialist communities:No matter what line of work you’re in, you’ve been honing your professional skills throughout your career and have built up a library of know-how. Multiply that by the number of people in your sales force and you’re looking at an incredibly deep pool of expertise for audiences to draw from. Skill complements knowledge. It adds proof to the promise of good ideas. That’s why specialist communities help nurture prospect relationships. They help build trust, proving your competence and adding value so you can establish and retain more customers in less time. They showcase the mastery of your sales force or your executive team — how you use your sharpened skills to achieve great results. Building specialist communities can also include your clients, giving them the opportunity to share their expertise or even to talk about how they have benefitted from the skills they’ve gained by doing business with your organization.

3. Business communities:What I’m seeing in the marketplace today is smart leaders in sales working hard to develop a good corporate rapport with their clients. In particular, they seek multiple buying influences inside their own accounts. They create a community of advocates inside their best customers. The outcome is they gain a broad base of support throughout the organization while building a library of knowledge about how that client’s business operates (e.g., who makes decisions and according to what criteria). This is about more than mining a corporate hierarchy for influential decision makers. In fact, every point of contact has value. Every conversation is a good conversation — whether it’s with a CEO or a gatekeeper. Insight comes in many forms, and each contact you make in that corporate community plays a role in the sales process. You will never lose business by forming too many of these relationships, but you’re sure to lose business if you fail to engage too few of them.

4. Education communities:Create a community of clients who talk about how you’ve helped them solve challenges, helped them make more money, saved them money or time, or retained their employees. You can leverage that learning opportunity to help grow your business even bigger. Learning communities come in many forms. It can be as simple as forming an advisory group or a user forum. It can feature shareable best practices or case studies, each one underlining the advantage of doing business with you. Smart, successful companies today recognize the power that results from bringing people together. They don’t settle for sales teams who operate in isolation. They create these communities where everybody can learn from each other and gain from that expertise.

Why the four communities count

Just like with farmer’s markets, buyers today are looking for more than a transaction: they want to do business with people who can provide knowledge and insight on top of the products or services being offered. That meeting point can only be achieved if you take the time to build a rapport with your prospects and customers. This means you put their needs first: help them learn and grow, and deliver value far beyond what your product or service provides.

Consider the following case study, which reveals the power of leveraging community and relationships.

A few years ago, Engage Selling began working with a mid-sized medical devices company. Their previous business model had hinged on their clients acting as resellers of their product. It meant that the product itself remained static, since there was no opportunity for their clients to provide feedback. They were reactive rather than strategic. With help from Engage Selling, this company decided it was time to do things differently.

A senior executive within the firm spearheaded a bold initiative to create a client-focused community. Doing this meant embracing one of their biggest fears: their clients would only use the forum as an opportunity to complain about what was wrong with their product.

Instead, three interesting things happened. First, the clients began offering suggestions about product features, leading to entirely new applications that had never been considered before. Second, the company suddenly found themselves with a range of success stories as their customers began to share with them and with each other all the ways they were using the product. Third, the firm’s customers became deeply loyal, and not just because they felt their input was valued; they also had a sense of personal ownership in the new direction of the firm. The outcome of this community and relationship approach was immediate. Sales skyrocketed and continued to do so quarter after quarter for several years.

Amazing things can happen when you embrace change as an opportunity to work differently than you’ve done in the past. Find ways to build your own communities. Think about how you can become a trusted part of today’s marketplace without boundaries. In doing so, this year could be your most profitable one ever. 

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Seller Styles, Application & Responsibility: Why Sales Training Isn’t Working, Part 2

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In Part 1 of this series, we discussed how the motivation and skill of individual sellers have a direct impact on your company’s growth. And, that once you evaluate team members, you’ll know if sales training is needed and how to customize it.

Now it’s time for specifics. How can you determine, more precisely, where individual sellers fall on the motivation and skill spectrum? How can you leverage and nurture their abilities? And, how can you fully apply sales training and hold sellers responsible for their progress?

Let’s start by identifying the four styles of sellers:

·         Unmovable

·         Slacker

·         Most Likely to Succeed

·         Team Leader

 

Unmovable

These are individuals with low motivation and high skill. Therefore, training them with new ideas to make them change and achieve growth won’t work. They’re content with the strong skill set they have — hence, unmovable. They’re not willing to learn new methods to achieve better results. Often, Unmovables are veteran sellers who are happy with where they’re at: managing current accounts, not having to make new calls, and satisfied with their current salaries.

Instead of trying to make them grow your company or adopt new ideas, Unmovable sellers could do much better with maintaining your business and account management. Consider reallocating them to new roles that play into their talents, such as account managers, or providing training that leverages what they’re already great at and are motivated to do more of.

For example, a client in the manufacturing field needed to grow the business by 12 percent. However, the seller that covered the health and beauty sector — and the company’s biggest client — flat out refused to participate and was visibly hostile during a training session. She was unmotivated to accept new ideas, yet was very skilled and successful at what she was doing.

Evaluating the situation, we determined her expertise was this major health and beauty customer. We changed her pay and made her sole objective to manage the one client. The result? She’s pulling in even higher numbers on the account and the company is happier.

 

Slacker

These are sellers with both low motivation and low skill. Slackers won’t grow your company. They also won’t expand current accounts because they lack skill and don’t want to learn. Essentially, there’s no use for Slackers on the sales team, so let them go.

 

Most Likely to Succeed

This covers team members with high motivation and low skill. They want to grow and try new things — but they lack the know-how.

These are individuals you need to train, coach and mentor because they’re your future superstars! Stay on top of them and make sure they’re applying new sales skills on a regular basis to grow your business. Recognize and celebrate their wins with them. Add bonuses to keep them motivated.

 

Team Leader

These sellers are the cream of the crop with both high motivation and high skill. They’re the top one or two individuals on your sales team. They’re always over target and they’re growing the business like crazy.

With Team Leaders, the key is leveraging them to encourage growth among your other sellers. For example, you can:

·         Make them subject matter experts within the company

·         Give them new projects

·         Allow them to expand their territories or have better ones

·         Join them out on sales calls to document how they’re achieving success

·         Let them run monthly training sessions to give them a leadership role

A natural resources company I work with followed this last step with great results. A number of people on the sales team were struggling to hit their quotas, so the VP assigned a seller that was a Team Leader to run training segments of the weekly sales meetings. The struggling sellers saw this colleague sharing techniques that worked and it motivated everyone to quickly adopt them. Sales, in turn, were driven upward.

 

Apply and hold responsible

Once you’ve classified your sellers and the initial sales training is complete, it’s time for your company leaders to buckle down. That means using two powerful drivers of growth: application and responsibility.

To avoid sales training falling to the wayside, the leadership team must install the framework for application and responsibility before the first training session. This means:

·         Plan to measure progress

·         Set targets

·         Tell sellers they’re responsible for what they learn

·         Schedule coaching sessions

Then, after training, the leaders need to closely coach and monitor activity. Have sellers document the top three ideas they’re committed to applying. Compile a list and share with the sales team so everyone remembers what they thought was best practice. Use this list in your one-on-one coaching sessions.

“Hey Bill, you mentioned your top three priorities for this week. Were you able to take care of them? Is there anything from me that you need to help you succeed?”

Once those first three items are in effect, return to the list to determine the next set of priorities.

 

Create personal goals

It also works to establish growth targets for individuals rather than a broad one for everyone. A temporary staffing company client had a positive outcome with this. He tracked seller progress through activity-based key performance indicators (KPIs), which both provided an early warning if something needed correcting and gave ongoing feedback about which activities were best for achieving particular kinds of sales.

This client also held the sellers responsible through one-on-one coaching, regular sales meetings, and executive gatherings to go over KPIs and prospects. Within a year of sales coaching, the team achieved their growth targets each month and, for the past two years, has broken new sales records each successive quarter.

Every company can achieve this type of growth. The first step is to always understand where your team members fit within the skill and motivation matrix, followed by appropriate training. After that, all it takes is a deep focus on application and responsibility. With these drivers of growth, you’ll be surprised how quickly your sales take off!

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Motivation & Skills: Why Sales Training Isn’t Working

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In my experience, I’ve found most companies approach sales training the wrong way. This might sound surprising, but hear me out. When sellers consistently fail to meet growth targets, the automatic assumption tends to be, “It’s a skills-related issue.” The company believes that all its sales team needs to succeed is proper training by an outside consultant or someone within the organization.

The truth is, skills aren’t always the problem. And, if they aren’t, sales training will only be a waste of everyone’s time and resources. As a sales consultant and trainer myself I’m continually trying to save clients from making this mistake.

Before your company invests in sales training, you should consider two important factors: the motivation and skills of each individual on the team. To what degree do your sellers want to contribute toward growth? And do they have the tools to do it? In other words, do you have a sales team that’s:

·         Skilled but unmotivated?

or

·         Motivated but unskilled?

(Or unskilled and unmotivated, which means it’s probably time to hire new sellers!)

Knowing these answers will determine if training is the right choice for your sales team.

Skilled but unmotivated

I once worked with a company that, despite having a great team of sellers, constantly missed its growth targets. There was plenty of demand for the laminated trade show booths, restaurant tables and signage they sold. However, all the training from the past had only made them better sellers to existing clients, not to new prospects.

Then I discovered this: The company wasn’t reaching its goals because the team, in reality, wasn’t motivated to grow. The sellers were in a rural area with a very low cost of living and were on full commission. They lived comfortably, so they didn’t feel a need to push themselves to make even $75,000 a year. Short of forcing everyone to buy bigger homes and expensive toys, there wasn’t much we could do. Sales training would’ve been useless.

In another case, I saw age and experience have a direct effect on motivation. I interviewed a potential VP of Sales who, at age 64, was very successful. He was interested in working with a client of mine at a start-up where a major hunt for business was underway. Right off the bat, however, he said he wasn’t willing to make cold calls — that he was “beyond all that.” In the end, he wasn’t the right fit because he wasn’t motivated to do the work needed and receive further training in that area — even though he was skilled enough to succeed.

 

Motivated by unskilled

Let’s now examine the skills factor. Consider those sales teams that are motivated to grow but can’t because their abilities aren’t up to snuff.

 

For example, a software client of mine works in a very mature market with a well-established team of channel partners and resellers pushing their products to buyers. Their sellers have never had to make cold calls, develop territories or request referrals before. The reason? The company’s resellers have always pushed the deals to the sellers and called every hour with leads.

Recently, though, there’s been a drive to grow more aggressively and increase market share in response to stronger competition. Now the sellers have to do the work of the resellers. The problem? They were hired to be reactive versus proactive and don’t know how to prospect. They’re being asked for a 30 percent increase in sales  more than three times what they’ve ever accomplished — but their current growth rate is still hovering at 10 percent.

In this case, the sellers are motivated but unskilled. Sales training is clearly vital in order to sharpen their abilities so the company can achieve target growth.

Personalize the training

Once your company decides sales training is the right approach, it’s time to gather input. If you’re a leader who approaches training based on what you think your sales team needs, you’ll likely miss the mark and nothing will get implemented. Sellers won’t accept new information nearly to the degree they would if the training were based on what they actually want to improve.

Before calling in a consultant for training sessions, ask your sellers to describe their trouble spots. This does the following things:

·         It ensures your company isn’t wasting time and money by addressing the wrong areas in training.

·         It allows your team to be involved in creating the solution. They’re being heard and see that training is being developed to meet their needs. This means they’ll ultimately buy in and implement the information.

If you option for one-on-one coaching, rather than a group training session, you can often skip this step because sellers will typically provide straightforward feedback during your coaching session. In this case, the material covered can therefore be adjusted on the fly to meet their immediate needs.

What’s next

We’ve discussed, in overall terms, the effect of motivation, skills and personalized training on your company’s growth. In Part 2 of this article series, we’ll get down to specifics. This includes how to determine what level individual sellers are at and how you can harness their talents. Further, you’ll learn how to fully implement sales training and use the power of responsibility to ensure long-term success. 

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Beware of These Prospects

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Wishy-washy answers. Heel dragging. Elusiveness. Favoritism toward competitors. And, sometimes, downright unethical behavior. We’ve all experienced at least a few of these aggravations while going through the qualification process with prospects. 

The real problem, however, is not reacting to red flags soon enough. Instead of taking a moment to ask deeper qualification questions that will straight out reveal if the prospect is legitimate, some sellers push on in the hopes of landing the prospect until it becomes glaringly obvious it’s a “no go.” This is a complete waste of time and energy that could’ve been used on more viable candidates.

So what’s the solution? Learn to quickly identify the prospects worth disqualifying. In my experience, there are five types that set off warning bells. And, despite further questioning, more times than not should be eliminated from your sales pipeline.

The Bargain Hunter

This is the prospect who’s looking but not ready to buy. Ask them questions and you’ll receive vague answers. For example, a shipping client of ours got a call from a prospect who wanted a quote on a shipment. And yet, the prospect didn’t have a date for a pickup or a delivery. He was clearly just looking around and had no intention of doing any actual business.

The Bargain Hunter will also indicate, through answering questions, that they’re considering well-known competitors with whom they have long, successful buying histories. You’re basically the last stop on their list.

Additionally, this prospect:

·         Won’t be clear about why they’re considering an alternative to the company they’ve used

·         Won’t give you access to their buyer

·         Won’t connect you directly to any of the decision makers or influencers

 

So essentially, The Bargain Hunter is just using you to compare prices and product features with the incumbent. In this case, I would ask again, very directly, “Why haven't you purchased from your usual company?” If the prospect’s answer is still vague, politely shake hands and move on.

 

 

The Heel Dragger

This one is pretty obvious. Slow to make decisions, won’t commit to a timeframe or budget, and keeps saying, “Call me next quarter.” This prospect wants to do business, but there’s no urgency.

The Heel Dragger might not have the right decision maker in place or they simply can’t make you a priority at the moment. Years ago, when I first started Engage, I encountered a prospect whom I kept following up with. Finally, after six months, the VP tells me, “You know, Colleen, I’m retiring this year and don’t want the expense to hit my budget because it will reduce my bonus. This can be a project for my successor.” I don’t remember what prompted his honesty, but his response led me to disqualify the client for the time being and try again the following year. It was also a lesson to ask more questions earlier on.

The Moving Target

This prospect hides their key decision makers while you run around trying to find them. If you’re being kept from the buyer, you can’t win the business.

A medical devices client I work with is particularly assertive with this part of the qualification process. He firmly states to prospects, “In order for us to move forward I’ll need to meet with the owner of the company.” If the prospect says no or stalls, he continues with, “I’m sorry. Then we will not be able to submit a proposal.”

It’s very rare he reaches this stage, but in the few cases he does, he’ll explain further that, “We have an ethical and fiduciary responsibility to talk to the person who’s signing the checks.” This usually persuades Moving Targets who are stalling to give a direct answer and can change a “no” to a “yes.”

The lesson here is to make a statement rather than ask a question. When you tell a prospect having the buyer’s name is a requirement, it puts you at a peer level. In other words, subordinates ask to speak to decision makers and peers explain how the process works.

The Lost Cause

This prospect comes to you with decision criteria that are clearly written for the competition. Recently a client of ours had a prospect whose number one, non-negotiable criteria was that the product had to be manufactured in the U.S. Our client is an American company that does all its manufacturing in China. In this case, because of regulations, it was critical that the prospect bought something manufactured in the U.S. And there was no way around that. Our client decided to drop the prospect. Why waste time with sourcing and siting when it was clearly the wrong fit?

As soon as something appears to be intended for the competition, ask the prospect about it. More times than not, you’ll probably have to back off.

The Shady Operator 

Engage once had a prospect who wanted to pay $10K in cash. Now, this wouldn’t be that unusual for South American or European companies because of currency exchange rates, but this prospect happened to be a fellow Canadian resident. Immediately a red flag went up about the possibly criminal way the money might be acquired. Whether this was a Shady Operator or not, we disqualified them. Better safe than sorry.

If you detect even a whiff of abnormal behavior, be on guard. In one client’s case, a prospect asked if the seller’s daughter was single and “what are you going to do about that?” Another client, a large Fortune 10 company, had a shipping industry prospect with no website, phone listing or credit card history who wanted to pay cash.

Also beware of prospects asking for gifts and favors before they’re even customers – essentially, “Do this and maybe we’ll talk.” Though you might feel pressure to qualify as many candidates in your sales pipeline as possible, The Shady Operator is definitely not worth it. Just think ‒ if you’re uncomfortable when they’re just a prospect, it’ll only get worse when they’re a customer. Simply walk away.

The more you immediately address red flag behaviors of these five types of prospects —asking direct questions up front — the easier and faster the qualification process will become. And you’ll land much more reliable clients who are worthy of long-term relationships.

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How NOT to Talk about the Competition

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Last summer I received a text from a friend cursing my basketball team in the upcoming season. We had just lost a star player and my friend was dancing in the streets. (He cheers for the rival team.) I took it in stride and fired back a zinger about how his team hadn’t won a championship in years. Back and forth we went in good fun. (And of course I won and took the last word!)

In the sports world it’s a tradition to jeer the competition and cheer for your own team. When it comes to selling, however, it’s a risky practice that will make your company appear less-than-desirable to prospects and clients. And who’s to say your competition won’t return the favor by bad-mouthing you in the marketplace?

With that said, the rule of thumb is to never talk about the competition. Whether it’s in the sales process, on a customer support call, at a networking event, or in social media, no employee should ever bad mouth a competitor publically.

There are, however, exceptions ‒ certain times when it’s necessary to acknowledge your opponents because customers are pushing for information on them.

In order to maintain your Nonstop Sales Boom you’ll need to address these moments gracefully while maintaining your company’s integrity. Let’s look at how to do that now.

Be general vs. specific

I’m sure you’ve been in this situation before: A prospect or client is debating whether to sign on or continue working with you and they’re researching other companies. They start grilling you for information about your competitors, essentially backing you into a corner. You can’t avoid their questions, so now what?

In this situation, when it’s necessary to satisfy a client’s curiosity, you should talk about the competition – just not directly about their offerings. What do I mean by this? Keep your answers general, never specific, making sure to use a positive tone. Then, bring the conversation back to you.

For example:

Customer: “What do you know about _______?”

Seller:  “I can tell you that we see them a lot in this marketplace and they’re a strong player.”

OR

“We love competing against them because they’re a really good company.”

And now switch the focus back to your own company.:

“The reason customers choose to do business with us is because _______.”

By keeping your answers general with a positive tone, you’re protecting your company’s reputation. Think about it: Anytime you say something specific about a competitor’s products or features there’s an automatic risk that what you’re telling your customer is wrong. And worse, if your client knows more about the competitor than you do, they’ll spot the mistake and it’ll hurt your reputation. For example, you might claim another company doesn’t have your product, but you really can’t know that for sure unless you’re working for the other company. Perhaps the competitor recently added that product or made other changes that you’re unaware of.

By giving specific information about a competitor that’s not accurate, you can single-handedly destroy a business relationship. The customer will start to distrust you in other areas. “What else is this seller telling me that’s wrong?” It will bring all other information you provide  ̶  and not just about the competition ‒ into question.

I know it can be difficult in the heat of the moment, especially when you feel like you’re battling for the win. But if you want to win more you must avoid the specifics and always be general with your answers.

Lay landmines to promote yourself

Sometimes a customer wants to know about your competitor’s strengths and weaknesses. How do they measure up compared to your company? In this case, again, keep your replies general about others before turning the question around to be about the strengths of your own business.

For example, your company offers training on your product and you’re certain the competition is lacking in that area. You don’t want to say to the customer, “The competition offers zero training, so you should go with us.”

Instead, tell them:

“Our customers love the fact we’ve always offered training. We make our customers successful because we have a training program that’s integral for our product.”

OR

“I know you’re looking at a few other companies. One thing our customers have found useful is asking detailed questions about our training program.”

I call this second approach laying a landmine. You’re giving the prospect information to show what you have is better than, or exclusive to, the competition and is therefore important to them. In doing this, you’re setting up your opponents to fail even though you’ve said nothing about them. Positioning here is key. When the customer asks your competition about training and the response is, “We don’t have any training,” they’ll be thinking, “Yeah, but, successful customers want training.”

A further example of general, innocuous statements? When I was with a Canadian-based software company, a customer of mine was particularly focused on knowing a competitor’s positive attributes. My reply? “The reason we win business is because of A, B, C and D. When we lost business to that competitor, the customer told me it was solely because we were a Canadian-based organization and they felt more comfortable doing business with an American one.”

This answer was true and yet general enough to be a non-deal breaker.  

Offer proof through testimony

If your company is number one or among the top providers in an area, you can really emphasize this without calling out the competition’s weaknesses. The key is providing evidence. The most effective kind? Client testimonials.

If a customer asks, “What do you mean you’re the top provider in this area? The competition says that, too,” you can tell them, “Rather than me going over the data, why don’t I share with you our client success stories?” Then offer up the latest case studies and testimonials to satisfy any need for hard data.

Having already laid strategic landmines about your company’s strengths, these testimonials will only tip the scales in your favor. And you will have won business without putting down your competition and while maintaining integrity with your customers

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Raise Prices Without Losing Customers

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After three years of selling products and services at the same prices, your company decides a change is in order. It’s time to make a few price increases to better reflect the current market and rising costs.

Of course, anytime prices go up sellers are bound to hear complaints from long-term customers. Some companies, in fact, believe regular clients should be exempt from price increases altogether; that there should be a reward for loyalty. And yet there are several other pricing methods that businesses employ as well.

The key factor in all these cases, of course, is providing advanced notice of your company’s plans. Pricing surprises are never good thing in sales!

As the economy continues to gain strength, a number of clients are introducing price increases to the market. To help, let’s review the three most common ways to raise prices. And how to do it without losing business from your regular customers.

A universal increase

The first scenario is the most straightforward: raise prices for everyone – new and old customers alike. In this case, you’re hoping your steady clientele will remain loyal even if they’re not thrilled to be paying more for the same products and services.

Ample notice is crucial. Make sure you give your existing customers at least three months advance notice to ensure you can work through any issues, address exceptions and negotiate if you have to.
If you’re in a “mission critical” situation with a customer, or have them locked into a one-year contract, then chances are lower they’ll leave. Still, prepare for the fact that when you change your terms of service, you’re opening the door for long-time clients to say, “You know, we haven’t reviewed our contract for a while. Maybe we should shop around.”

To lessen the possibility of losing business, offer to extend the customer’s current rate for a few months or an extra year. Yes, this gives them more time to shop around, but it also increases the likelihood they’ll become more comfortable with the idea of your price changes. They might ultimately decide it’s easier and less costly to stay with your company than start over with a new one.

Go 50/50

Scenario number two is to keep prices the same for existing customers and only raise them for new ones. A client of mine sells to law firms and often sees this method applied. The lawyers will increase the billable rate for new customers, but not for long-term ones because the services and products they’re offering are the same.

In this case, it’s not just the customer but law firm that are benefitting. That’s because it costs less each year to manage the same products and services for a long-term client. You know them well and therefore aren’t continually trying to figure out what they want. And you’re also not investing money, time and energy toward marketing because you’ve already attracted their business. So even though you’re keeping your prices the same, you may find you’re increasing your overall margin with these existing customers.

Add services and a choice

The third and final scenario has several components: add more to your current offering, raises prices, and then give your long-term customers the choice to opt in or opt out. For example, “We’re increasing your rate to $150 because the service offering is changing. Now you’re going to have A, B, C and D as opposed to the A and B you were receiving before.” Then allow the client to choose. “Do you want to stay with what you had before or do you want this new, enhanced service?”

A client of mine recently did this with great success. They increased the price on their software maintenance and told their regular customers, “You were paying 10 percent and you received all the updates. Your rate is going to 12 percent, but that allows you to call the help desk whenever you want with questions and issues. We can keep you on the 10 percent plan to give you just the basic support if you really want, but we’re encouraging our clients to switch to the 12 percent package so you have the opportunity to call into the help desk.” More than 75 percent chose the new enhanced service.

This client has a rock-solid product and knew the company rarely received help desk calls. So while that 12 percent was providing more value to the customer, our client considered it low risk because the chance of people calling in on a regular basis was slim. And they were right. Customers only tended to call once or twice a year.

Extra value of advance notice

As mentioned before, giving advance notice about a price increase to your long-term customers is crucial. But it’s also just as important for your sales team. For instance, if clients are notified six months ahead, it gives sellers a chance to hear feedback and determine who’s unhappy about paying more and considering taking their business elsewhere. They can work to save those customers but also have a chance to backfill if some clients are determined to leave.

Gathering this type of information allows your company to do two things:

  1. Make a decision to reverse the price increase or change the new service offering if you realize you caused a huge exodus. After all, companies do make mistakes – just make sure you catch them before they bankrupt you!
  2. If sticking to the price increases, it equips your sales team with the time to go out and find new customers to replace the ones who are leaving.

However your company chooses to raise its prices, in the end it’s the strength of the relationships sellers build that will ultimately help decide if a long-term customer stays. And hopefully for many more years to come!

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ARE YOU THINKING BEE?

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My boys love "The Bee Movie," an animated film staring the voice of Jerry Seinfeld. At risk of spoiling the movie, one of the messages is around how bees have their own unique way of thinking; a language which only a bee can tap into, with concentrated effort. Once a bee learns to "think bee," they begin to have insights into exactly what they should do in order to achieve success.

 

As a business owner or executive, are you Thinking Bee?

 

During an event I spoke at this past week in Phoenix, we discussed how some of the most successful entrepreneurs and business owners think. Those that are highly successful think big. Greg, a client and friend, has successfully built his father's business from $5 million in annual sales to now over $150 million in annual sales in just under thirteen years. The business is still privately held, and he is still the CEO and main shareholder.

 

Through discussions with Greg, I have determined that there are several key practices that he has used in order to think big and achieve the levels of success he has achieved.

 

1. Audacious Goals: The goals that Greg set early on for growing his business were not small. He didn't focus on annual incremental growth, but set extremely high revenue targets that seemed impossible.

 

2. Support Network: Greg surrounded himself with people who were highly successful. He sought out these individuals by networking at industry events and joining a peer advisory group. Greg attributes highly successful people as a key ingredient in helping him realize what was possible.

 

3. Focus on Your Strengths: Having known Greg for fifteen years, I can tell you that he is a natural-born seller. The cliché that Greg could sell ice to Eskimos comes to mind. Early in the business, Greg hired people to take on the areas he realized weren't his strengths, allowing him to focus on what he was good at - sales.

 

4. Outsource Sweating: Greg is not a detail-oriented person by nature, although he can be if necessary. It's for that reason that Greg delegated the small details to others - he didn't sweat the small stuff, but kept his mind de-cluttered to allow him to focus on bigger and more ambitious opportunities.

 

From my experience, the most successful business owners and executives all have a similar way of thinking, the key characteristics of which I have captured in my latest e-book - Journey to Success.

 

You can tap into this way of thinking by incorporating the ideas above into your own business. So are you Thinking Bee, or just buzzing around?

 


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Talking about my generation and yours: Everyone can do more with new technology.

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One of the most common ways we tend to define generational gaps today is by the way we think about technology and how we let it influence our lives and our work.

 

I can say that with some authority. Even though here at Engage we are advanced technology users  in our daily work, at times I still find it a little mystifying what younger generations are doing with it (can someone please explain to me the legitimate appeal of Snapchat?).

 

It’s okay to say no to chasing every trend that pops up in the digital zeitgeist, but you owe it to yourself and to the organization you lead to keep an open mind about how new technologies can help you improve your work as a sales leader.

 

How we perceive and apply new things.

To illustrate, have a look at this recent survey of Fortune 500 CEOs. While it suggests “80% of them find communication across generations to be a most challenging issue in the workplace,” it goes on to explain that the real issue isn’t a matter of who is or isn’t using new technology.

 

The challenge is in how it is perceived, and in the assumptions we make about how it’s applied to the workplace—especially in the workplaces of our buyers.

 

Technology is not a replacement for communicating with people. It does not render obsolete the time-honored business skill of building a great rapport with others. It enhances that skill.

 

It does not mean you no longer have to conduct regular follow-ups with prospects directly. It means you have a greater selection of tools at your disposal to do so, and you must choose those tools that are most important to your buyers.

 

It doesn’t mean you should just start messaging all your clients via LinkedIn rather than picking up the phone or arranging face-to-face meetings, but maybe there’s a way it can improve your workflow and give you better results in less time with those buyers that are on LinkedIn.

 

Do your reseach. Since you and your sales team do your jobs well, you’ll have already developed a deep, detailed profile on each person you do business with (you’ve done that, right?). You’ll know which ones are open to using which new technology platforms and new approaches to achieve goals that matter on both sides of the negotiating table.

 

Timely versus timeless goals.

 

Accelerating sales to more people in less time is a timeless goal. What’s changed are the range of choices you have in how you achieve it, and the degree of openness to which people are willing to try new things.

 

I have a client with whom I negotiated and closed a major contract—all via text message. That happened only because I knew them well and understood this was a method of staying connected that they were comfortable with. Just as important, I understood how much they valued their time and the ability to make decisions quickly. So I used a tool that helped both of us meet those needs.

 

Consider your outcomes.

 

Here’s a simple test you can apply to your team when faced with a choice of whether to introduce a new technology into your sales process.

 

 

1) Does it get you measurably closer to your customer, either in terms of gaining regular face time or a deeper understanding of who they are and what matters to them?

 

2) Does using it save time for both parties without undermining the quality of the buying experience?

 

3) Does adding it to your workflow reduce the number of steps required to complete a business transaction while maintaining great personal rapport?

 

If you can answer yes to these questions, odds are good you’re making a smart choice that will help you land more business and foster deeper relationships with customers and prospects. 

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Drop These Clients Now

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Not all clients are created equal. Nor should you be compelled to treat them equally. There’s no law stating you must sell to everyone, or keep servicing clients who don’t fit with your business.

It’s as fair to say that your business has outgrown some types of customers as it is to say you have customers you should’ve never brought on in the first place.

If you’re suffering working with a client who you know isn’t profitable, you won’t be motivated to serve them well. And, if that client isn’t receiving the best treatment, they won’t hit their desired goals or be very happy either. By virtue of this predicament, you’ve created a lose-lose situation: You’re not helping the client reach their objectives and they’re not helping you reach yours.

Besides the ones who clearly aren’t profitable for you, here are four other types of clients who must go immediately:

  1. The ‘it’s all about me’ client: These are the clients who expect you to work only for them and all the time. They drag phone calls into demanding, in-person meetings and lunch appointments into all-day events. They even call your cell phone on the weekends.

These relationships never work and turn ugly when the client’s inappropriate expectations aren’t met. I fired one of these “I expect you to be in my office for a 6pm meeting today” clients after only one month. Life’s too short.

  1. The ‘or else’ client:Walk away from any client who constantly peppers you with threats. They might warn you they’ll withhold payment, leave for the competition, or shop your solution around. You can’t do your best work for them if you’re constantly under negative pressure.

Recently a technology company client fired a customer who used “or else” a lot. They told my client, “Do this or we’ll replace your software with your competitor’s product!” and “You have to give me free support or I’ll leave!” At first my client obliged because this was a big customer. Then, however, the demands became so outrageous it was no longer worth the effort.  

 

3.      The ‘pay you later’ client:You aren’t a bank, even if you work for a bank! Cash flow is the lifeblood of any business. When a client starts abusing the financial aspect of the relationship, talk to them immediately. If they won’t rectify the situation, stop work until they do or fire them immediately. No matter how prestigious.

 

A manufacturing client recently ran into this issue. Despite repeated requests, their customer was 90 days late on a payment. The solution? They stopped making the product for the other party. Without the needed shipments, the customer was forced to shut down their own manufacturing line and lost production time. Needless to say, the overdue payment arrived quickly after that!

 

4.      The ‘drama queen’ client: Success and failure should be a shared experience. When you and the client achieve a desired outcome, it should be celebrated as a team effort. And, when something goes awry, there shouldn’t be any finger-pointing on either side. Everyone accepts responsibility for their part in what went wrong and quickly resolves the issue.

 

Rarely is a mistake one-sided but if it is (and all on you), accept responsibility immediately and resolve the issue. If a client is continually parading your joint success as their own singular success while at the same time foisting all the blame on you for any failures, your relationship is one-sided and can never be profitable for you.

Cutting ties

Firing a client may mean a short-term hit to the organization’s profits, but it’s critical for the long-term emotional health of your team and the company. Cutting ties now with troublemakers not only frees up time to focus on your more profitable clients, it also provides a boost of morale internally. When you step up and fire a bad customer, you win everyone’s trust, loyalty and respect  ̶  especially your own.


Here’s the easiest, most respectful way to fire a client:

1.      Phone them:Don’t use email. Acknowledge your business relationship and explain you’re no longer the best fit. For example, “Thanks for all your past business to date. I sense at this point we’re not in the best position to meet your future goals.” Always keep the focus on the client’s interests.

 

2.      Stay classy:Don’t use this call as an excuse to tell the client everything that’s wrong with them and their approach. Simply explain they’ll be more successful working with another company.

 

3.      Provide options:This way you can quickly find the client a new home. For example, one of our staffing agency clients always has a list of other local staffing agencies that might be a better fit in case he gets a call from people he can’t service.

Once you gracefully let go of problem clients, you’ll have room to focus on the higher-caliber ones who will, in turn, strengthen your business. 

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