Why you should say no if you don’t match 100% of your prospect’s need

In the good old days, sales people were able to fill their portfolio with stock items and hit the road selling those, without much preferences if customers’ needs fit to that product. But now, customers are demanding 100% solution of their problems.

Some time ago, in a world of never ending market growth, goods had to be produced cheaper and cheaper, driving competition harder and harder. All eyes were focused on how to source and produce to the lowest cost as possible, not what customer really needed.

Customers thought they were needed the offered goods – and for sure, they couldn’t find anything else. And customers were right, not much were changing from year to year or even from decade to decade. Globalization – as we now it today – driven by the internet revolution hadn’t started yet. Companies were pretty happy to source their business with goods available.

Then something happened. A great paradigm shift, from producers’ point of view to customers’.

The introduction of internet started a customer education process. First at slow pace, but soon accelerating. Customers started to get informed using available information and with social media introduction, they were also able to discuss within their networks about their problems and needs, just to get as informed they could before they engaged with a salesman.

Today, this paradigm shift is fully completed. The customer has made himself comfortable in the driver’s seat and decisions are made fully informed. But they still need help to match products with their needs, in detail.

On the selling side, we meet with fully informed customers, so it shouldn’t be any problem – if you are informed at the same level about your products. In my blog post Why Expertise Outperforms Process , I explain why being an expert on your own products or services is mandatory these days.

But my point is, if the salesman’s offer don’t fit 100%, the customer don’t solve 100% of their problems. The result on your customer’s side is not reaching their fully potentials and goals, leading to decreased competiveness. On the selling side, you may lose the deal to a competitor meeting 100% of the needs. Or, have a lot more work to get it. Work including persuasion, product customizations, discussions, motivations an much more hassle to eventually end up with the signed contract.

My advice is simple. Only go for opportunities you know you will solve 100% of your customer’s needs.

puzzle

In an efficient sales process, the first stage – qualification – secures no deal is allowed to pass if not a couple of qualification questions are having positive answers. Common questions are such as if customer has budget, if you talk to the decision makers, if investment is intended in reasonable time frame, if competition is not too overwhelmingly and so on.

“If your product fit” sometimes is one of these questions, but not too often the most important and never the only one. Why? It should be.

Think about the “good old days” when everything you produced could be sold, no matter what. The salesman was king and customers were trusted him as The Voice from the world outside.

Those days could be revived once again, if your product is solving 100% of your customers’ needs and most of your time is spent on helping your customer understand and trust that.

Doing so before you qualify your opportunity in your sales process, will save tremendous amount of hassle and time. But to afford to spend all your time on fit matching, you need to say NO to opportunities that not have any potential to pass the “Fit Test”.

Good luck!

Stefan

 

 

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3 stories that reveal if your sales attitude is out of date

It’s not easy to cope with all dramatic changes now happening around how to sell. High performing sales reps do, but my following true stories tell many people within sales and SMB’s still have a long way to go before they would be able to compete in the future.

outofdate

Story #1

In my garden there was until recently a huge red leafed beech. It’s height was almost 60 feet and due to that we couldn’t leave it for another year. We had to take it down. In my former life I certainly was a monkey or such animal, so I went out climbing up to the top, taking down one branch at a time.

One day later I was satisfied with my work. However, the tree trunk was still left. I scanned the internet after firms that could help me taking the trunk down. I called a few local firms and selected one that already the coming Friday was able to finish the work. Being an experienced sales person, I appreciate if a buyer comes back to me, even if it’s just to tell me I lost the deal, so I went out texting those firms that lost my deal.

Here’s the text dialog with one of them:

Me: Sorry, but I have to tell I selected another firm for the job. Thanks for your time anyhow 🙂

The sales rep: Now you lost a lot of money! We’re always 30-40% below our competitors.

Me: (slightly sarcastic) Ooops, then it certainly was a lot of money, maybe several dollars? But you didn’t check all of my needs when you called – I wanted to get the job done already this week… By the way; care about what you’re texting – just a small tips.

The sales rep: I always stand up for what I write or say. I’ve been in business since the 90’s and last year we got 96% of all jobs in your town.

Me: (increasingly upset) Think about if I had another tree I needed to take down? Regarding your attitude, do you really think I would be contacting you again? Blaming a potential customer is not a good choice. I’ve been in sales for a long time and teach sales reps, it might be a good advice to join one of my sales training classes…?

The sales rep: You should consider a training class in Foresight to earn some money!

End of story.

Lesson learned. Always accept a lost deal with a smile and a “good luck”. Look at it as a new opportunity that starts. We all know prospecting takes time and even if you lost this deal, you got in touch and next time it’s a warm call.

Story #2

This story is recently shared from my brother. He had some problems with his chainsaw (I know; you may think we are all in forestry…) and went to a retail store to get it fixed. He asked for service and the sales rep took the chainsaw into his repair shop. The brand was one of those they were selling in the store and the sales rep promised to fix it. But this was what happened next:

The sales rep: OK, I know what’s wrong, we’ll fix it. By the way, where did you buy it?

My brother: (little embarrased) On the Internet…

The sales rep: ON THE INTERNET????? Just go away and take your worthless chainsaw with you! People buying things ON THE INTERNET are not welcome in my store!!!

Lesson learned. Not adjusting your attitude and business to modern buying processes where customers using the internet and social media to educate themselves, buy things and compare, are just out of date. It’s a major threat for SMB’s but not aligning to reality is only stupid. Such aligning might be: “Great, we have a special offer for those buying on the internet, it’s a service agreement for only 99 dollars per year and I can make this included as the first repair. Would you like to fill in this form, please?”

Story #3

This story is a short one, also shared from my brother. His mower was not starting, so he called a local shop to get it fixed. However, the shop was closing at 4 PM and he knew he was a little late calling 4.05 PM:

The sales rep: (first thing saying) Do you know what time it is???

My brother: Well yes, I actually do, but I took a chance and called anyhow; and lucky me, you answered.

The sales rep: We’re closing at 4.00 PM, you cannot call later. Come back tomorrow! Then he hung up.

Lesson learned. Nothing is closed anymore. Business is always open, 24/7. Opening hours are restricting in itself, but here’s the worst thing about the short conversation above: The sales rep was actually picking up the phone. It’s not just missing the call if he didn’t answer, he also damaged his brand and that may be unrepairable.

Recognize any of these stories by your own? Do you have any more examples of out of date sales attitudes? Please tell in the comment line below! Maybe we all as high performing sales reps would get a big laugh at least 🙂

 

Real Customer Need Is Not What They Are Telling You

I’ve just started to use my new Apple Watch. It was an unexpected gift on my recent birthday. My first thoughts was:

  • What will I do with such thing?
  • I don’t wear any watch at all
  • Actual time is always displayed on my mobile’s lock screen

Today, that little thing is one of my best friends. And that happened in about four weeks. How did that happen?

Watch

The answer is of course Apple showed me an alternate behavior I couldn’t resist. As I know Apple they are excellent of showing alternate behaviors. The best – and most discussed – example is of course the introduction of iPhone 2007.

At launch, most people said a lot about the iPhone – it’s was too expensive, too bad to make calls, too slow, etc… But when the war was over, it was named The Invention of The Year in 2007 by Time.

In 2007, the market for smart mobile phones was completely dominated by the Nordic companies Nokia and Ericsson. They made phones evolved from a history of making just that – phones. They hadn’t the culture to create anything but phones. Of course, there were some alternatives – but who remember Microsoft CE nowadays…? A compressed windows interface into a small screen, delivered along with a stylus pen. Microsoft claimed it’ll be the way to go, since people would like to have the user interface just like the same as in user’s PC.

In summary, the dominators’ proposal was either to use just phones or micro-sized computers on mobile devices. What Apple created instead, was a new behavior for a lot of people, ending up by taking  the computer into the streets.

Exactly the same happened 2010, when Apple launched the iPad. I remember my words of wisdom; “OK, I have an iPhone and a PC; why should I bother to buy an iPad?” We all know, Apple took the PC to the couch, giving internet surfing it’s natural place or to the kitchen creating a fast and convenient way of searching and reading baking recipes. Again, Apple changed our behavior.

To learn from this stories in your everyday selling, you have to stop think about the needs your prospect tells you about. To make you successful, you have to make your prospect successful – that’s the usual way to go in all sales. To accomplish that, you will have to investigate harder not what they tell you they need today based upon what they see in the near future. You have to propose to them where you think they have to go to change their customers’ behavior.

It’s not enough to make them successful today, to be the one they hold on to in the future. You need to visualize for them what they need tomorrow to get major competitive advantages.

Just as simple as that, Apple Watch changed my behavior in many ways, for example while running. I can follow my pulse, average pace, distance and at the same time discuss my new sale with a colleague. All data collected and summarized in nice presentations compared to my health and business goals.

Apple took my office into my running trails – and gave me additional productive time while keeping my body in good shape. That’s a success for me. Think of what successes you would like to provide to your prospect’s customers in the future.

Only then you will be successful as a salesman.

 

 

Barefoot Sales Process

In 1968 Nike invented the modern running shoe – Nike Cortez. One of the founders of Nike, Bill Bowerman, stuck a large lump of rubber under the heel of the shoe to, as he said, to stop the feet tiring and give them an edge. With the heel raised, he reasoned, gravity would push them forward ahead of the next man. Before this runners like famous Roger Bannister all ran with backs straight, knees bent and feet touching the ground right under their hips, using their toes as a balance. Their only shock absorption came from the compression of their legs and their thick pad of midfoot fat. Thumping down on their heels was not an option.

In addition to Bowerman’s experiments finding the new modern running shoe, he wrote articles and books about a new running style; and it was the ignition of the Jogging Wave .

The rest is history. Today Nike’s turnover is around $25 Billions. The running shoe industry alone revenues over $20 Billions yearly.

But is this industry one of the largest fake in modern times?

According to the book Born To Run by Christopher McDougall it may be. McDougall uncovers a frightening truth: since the introduction of the Cortez shoe the injuries from running have exploded. Leading experts agree it depends on the fact that the modern athletic shoes package the feet so much that they become too weak. The muscles in the feet prevents to be strong, the more they get packaged.

barefoot

And despite some thirty years, all multi-national brands of running shoe makers and their marketing suggestions, no manufacturer has ever invented a shoe that is any help at all in injury prevention. The more expensive, the more injuries.

Some years ago two Nike managers were watching one of the top athletics teams they were sponsoring. They were confused since the athletes seemed to prefer – to run barefoot. “Haven’t we sent enough shoes”, the Nike folks asked. The athletes told they could train a lot more without getting injuried when running barefoot.

If we translate this story to sales strategy and process, it hits me that it’s very near the same. We invest millions of dollars buildning support systems, analytical models, big data, strictly KPI:s to follow, expensive CRM-systems…but do we really solve the real problems? Are we really making more deals? Do we really land higher sales revenues? Do we really find the most profitable opportunities?

My conviction is that we package our sales organization so hard, like machines, that we lose our creativity. We don’t let our feet – sorry: our sales reps – look for the best opportunities, because we tie them up to follow our one-size-fits-all sales process, supported by strictly and detailed KPI:s. The result is that everybody are looking for the same type of deals – even if the market and competition changes very rapidly.

Why not going for a barefoot sales process?

Your reps are thinking people, experienced enough to radar where to search, using the best method, building the most fruitful relationships. You will definitely get a flexibility to meet changes, meet competition; it’s an agile sales process. What you need is a support for Catching Point. That means, it’s rather the beginning that is important, than the process itself. The focus task, with this perspective, for a creative sales rep is to recognize and catch needs, as clever as possible and based on his experience of the industry or as a business man. The only support they need at this point is a sort of easy-to-use app to register what the need is, to whom and when it’s time to take the next contact. Nothing more. When times comes, the rep heavily spend their time to detail the potential customer’s need and the solution to it, but not until then. It’s a Lean Sales Process – or what I call a Barefoot Sales Process.

And like in barefoot running; set your sales reps free and you would obtain a lot more creativity finding revenues and profits. Let them BE true sales reps, not prisoners in stiff shoes – or processes, KPI:s and organizations!

Checkout the Sales Scenario app for iPad, thanks.

Good luck and Best Regards,

Stefan

Sales Decisions have never been easier

Finally, we’re here. I’m very proud to announce Sales Scenario – your Sales Tactics App. It will profoundly change the way you make sales decisions. Instead of reading prepared reports or analyzing fancy charts, you and your team will actually run scenarios of the future to find the best way forward, by asking yourselves “What if …” The result will be better and more well-grounded decisions, which in long term will mean significantly higher profitability for your company. In my last post I told you:

“There are modern solutions, that in one single tool let you run and elaborate among future sales specific scenarios as many times a week you need to, invite and chat with your management team, friends or experts – when they got the time to – and get inspiration from top sales gurus, to make better and more well-grounded decisions that are already implemented from start, so you can stay as the leader in your specific market.”

Let me introduce the core principle of Sales Scenario App. The Tactical Perspective. In The App you fill in sales figures of where you are today (for example revenue achieved so far), where you need to go (for example your end year revenue target) and the chart in the app will tell you what to do. TacticalThe App will calculate backwards in your sales process based on your input. The amount of required numbers in the stages in the process are decreased according to the actual efficiency – the hitrate. An example. Opportunities. The chart will show both how many (in average per sales rep) opportunities that are achieved the current date and how many every sales rep has to create from current date to target date (typically year end) to reach the target. Current - Target In this case every sales rep has created 7 new opportunities every week (the green column in the chart), but from now on until target date they have to create 9 new (the orange column), otherwise the target would not be met. But is that amount really possible? If not, start play with the scenario by adjusting one or several constraints. Or run several scenarios, until you find the best. That’s more dynamic than a report or fancy chart, isn’t it? It’s like running a chart. Summary. The core principle of Sales Scenario is that good decisions are not made in isolation in response to an individual’s idea or individual piece of data. They require shared knowledge and analysis of a combination of different pieces of information. It adds future dimension as well by running several scenarios and asking the “what if question”. The Sales Scenario is available on AppStore today. Please let me know what you think! Best Regards, Stefan

Why the decision process is more important than the charts

Got a paper in my hand, covering the new hypes of Business Intelligence. I wasn’t especially interested though it’s my area of work, because of all superlatives of what you could analyze. There were those fancy pictures showing columns, pies and all other types of charts.

Now, what were the charts showing, really? And if you understand them, what would be your action?

The feeling became more and more obvious. We dig deeper and deeper into the databases, but do we understand the results? I was little bit discussing this in the blog post Big Data anyone? It’s time for Less Data. We hurry finding answers, but we are not really specific about the questions.

However, the paper was showing a lot nice answers to me. A lot enterprises have been pouring billions of bucks into their fantastic systems, costing plenty of money in licenses and consultancy fees for their customers.

But at the end of the paper, there was a tiny little article that cought my interest. It was telling the future of Business Intelligence is you. Yes, you. The humans, the management teams. Discussing what to do using their experience and making decisions.

Besides the thought that the humans have taken decisions long before BI tools were developed, the article pointed out the actions taken AFTER the analytics are presented. The process we use to move forward taking good decisions.

The point was the BI tools for the future should be supporting the decision process it self, not really the contruction of another pie chart or Big Data project.

The analytics and charts will in the near future become commodity, at no or low cost and easy to achieve, due to high competition and the trend of having access more than own the data or charts. But the decision process will still be sophisticated, because we are humans. We still have to make and implement decisions, and we still have to change people’s minds.

We still need to get well grounded decisions to accomplish change. And we need to change even faster than before.

As always, it’s easier to change in small pieces than in one major leap. That’s why it’s more important to start thinking about your decision process than your charts.

But I admit they can be nice and colorful 😉

Best Regards,

Stefan

Strategy Myopia

Are you having an unsettling feeling of not gaining market shares or are you losing growth pace, despite heavily investing in marketing?

First; what does “Marketing” mean for you? Reading various definitions as “Marketing is the process of communicating the value of a product or service to customers or ”Communicating products or services in a multi-channel environment”, I’m confused about why we never learn.

Borg

The year was 1991, the place Monte Carlo. Björn Borg, the world famous tennis player; “Mr. Five-Wimbledons-in-a-row” and one of the best players in the tennis history, steps out onto the Centre Court for his comeback at the Tour. In his hand he held the wooden racket Donnay Borg Pro. When Borg won his fifth Wimbledon title in 1980, nobody questioned his choice of a wooden racket. In 1988, Donnay went bankrupt overtaken by its competitors. His antagonist, Jordi Arrese, was playing with a new material graphite racket, weighing 25% less.

Borg lost his comeback match and retired shortly afterwards.

A large enterprise developing and selling accounting systems for PC’s based in my hometown said in 2001, internet based accounting systems is just a fly and that people wouldn’t dare to put business critical accounting information on the net. The same year the Swedish company Fortnox also headquartered in my hometown introduced accounting systems as a web service paid per month. Today, Fortnox has 40,000 customers, each with several users.

Why?

As early as in the 60’s, Harvard Business Review published Marketing Myopia by Theodore Levitt. This article is one of my favorites all these years and I read it every now and then to get the right perspective when I’m feeling blinded by fantastic business ideas or products. The essence in the article is that we were, and in my perspective still are, so focused on our own products that we can’t see our customers’ needs or misinterpret them.

We are suffering badly from Strategy Myopia, defining our market too narrow. Levitt is discussing examples like train companies that in the 60’s narrowly defines themselves as being in the “Train Industry”, but should being in the “Transportation Industry”, and by that be able to catch new opportunities along the road when customer needs changes.

My recent examples from the tennis courts or accounting should also redefine their markets. Donnay was not lucky defining themselves as the market leader in Wooden Tennis rackets, while the large accounting system enterprise should redefine their market to be more like “Accounting Industry” or similar, not “PC and Mac” making it completely of no matter what platform the customer intend to go for. Why are they giving away 40,000 potential customers?

I think it’s because we are so tied up in our existing strategies, coming from myopia in marketing, sales, finance, R&D and supply chain.

On one side Marketing invests billions of dollars in campaigns explaining why people should buy your product and we are continuing asking our customers what they think about our product, followed by massive investments in R&D aiming only to fulfill the results in our own-defined questionnaires.

We train Sales reps learning key features, USP’s and selling techniques to convince buyers like what is supposed to fit into our templates. We go as far as creating KPI’s only to consolidate they only sell what they are told to. Why on earth would we have to convince buyers if they really need our product or service?

Further down the chain we configure our Supply chains to produce the products at increasingly lower costs, see Håkan Bernhardsson’s blog post Is your company customer driven?

This in turn, will even more cement our ambition to produce a larger number of them – and exactly those produced products, even if they aren’t compatible 100% of the customer needs. And above all, Finance controls that no risk is taken, cost is on an acceptable level and the sales forecasts are delivered timely and accurate on detailed article level.

The last thing we do is to put a huge wet blanket above our existing business model by delivering all necessary reports to the stock markets or owners and then we can’t change anything.

Sorry Stock Market. Five years later we may be bankrupt, like Donnay. They didn’t realize they should fulfill a core customer need – tennis rackets, or even just “rackets” if people intend to play more badminton instead in the future.

I certainly realize it’s not possible not to plan for a demand of an article or product area, invest in supply chains, R&D, train sales forces and let finance do the risk management. But we really need to look into how we can incorporate customer need in our strategies. The Marketing Myopia article was written by Theodore Levitt fifty – 50! – years ago. And still it’s easy to find examples of narrowly defined market strategies.

Just to be sure; start with the definitions. What is a “customer need”? Don’t misinterpret with “customer demand”, which I define as a demand for a certain product or service we already have defined by adding features or functions. A typical core customer need can be the ability to go downhill a skiing slope (containing all products providing just that – carving, snowboard, etc), windows (products letting light into spaces).

Even if your supply chain currently only can manufacture a certain type of, for example, wooden windows, make sure you look into the ability to produce plastic windows as well. How do you know it would not be a hit, in say, eight years? Why give away that market?

Incorporation of customer need means more than just gathering of knowledge. In a recent blog post Håkan Bernhardsson raises some thinkable comments about using Big Data. If your organization is not ready, it may be very risky business to lean on Big Data to get knowledge about core customer need. If you are ready, it may provide some valuable knowledge.

The real problem is instead your long-term strategy, your processes, your culture and your people. You need to drive change management from strategy to tactics, down to operational levels and processes. Aim long-term – five years or even longer horizon, but act agile. Take decisions, but use decision points; fixed dates when you have to take decisions, see my blog post about decision making in an agile world.

Early warnings comes with heavy marketing budgets, too rigid supply chains, upcoming competition, decreasing market shares, powerful R&D department and too much cost focus on existing product articles.

It’s not bad branding narrowly, but can you afford the risks doing only that? It’s one thing what you currently tell your customer, a completely different thing what you are preparing.

Best Regards,

Stefan