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.

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

 

 

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.

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 🙂

 

What is Lean sales? – Identify your internal customers!

Continuing from my earlier blogs:

What is Lean sales?
Identify your external customers!

This is where I believe we all assume too much. Most people in an organization have their own networks and routines for communicating within the organization. This has been developed during a long period of time and is handed over from person to person as people change position in the company and as the company grows. It has not been put in place, it has just happened…how do you know that this is the best way to perform the tasks in your company?

Understanding is better than believing, so find out who in your organization you as a sales group hand over information to. Is there a secondary party within your organization that receives information that comes from your group? Should this information not be passed on directly?

“Any fool can know. The point is to understand.” ― Albert Einstein

Is there a white spot on the map? Is there a group within your organization that is seeking information that you could be providing, but you are not?

I heard a great example of a white spot. In a company working with industrial installations in the 80’s. In some cases the customer provided engines that were supposed to be used in the final product. Normally the purchase department was responsible for all the incoming goods and when they placed the orders, goods management was already planned and article numbers were in place. The customer unique engines would turn up out of the blue, the team handling the receiving would call the purchase department and ask about them, but since the purchasing department had nothing to do with these engines they had no information to provide. The result was that the engines would be stashed somewhere and many where lost on their way to production costing a bundle of money and irritated customers. If the sales department had seen the goods receiving department as a customer and understood their responsibility they would have set up a routine with the receiving group and communicated to the customer how engines need to be labeled and shipped in order for their company to manage them.

These days Big Data is widely discussed. The requirements to enter information are constantly increasing. A lot is probably rubbish, but some will definitely bring value to you or to some other part of your organization who is a customer of this information. Look through your entire business process and organization scheme and truly define who is a receiver from your sales department. It is better to do a few things well rather than trying do a lot and making a mess of it all…so find out where your input will have the biggest impact.

Why Expertise Outperforms Process

Our home has a kitchen that is divided into three different sections. Not very well planned at all and now we’re gonna make something about it. Two heavy walls will be demolished making room for a large kitchen in one single space.

We’ve got in contact with two different suppliers. The first one really caught us. The salesman listened to us, asked a lot questions and, finally, when he presented his layout proposal for the new kitchen we totally gave up. It was fantastic and, even if it was over half a year to when we had to make our decision, we thought we already had made our selection of supplier in our minds. He told us about the process forward, the steps towards the order and after that, the installed kitchen. It was obvious he followed an established sales process – I can see his checkboxes and drill-down questions in front of me. As a sales executive myself, I admit I liked it.

We thought we had met a structured and professional salesman. Indeed, we were in safe hands.

The second supplier also asked some questions, but was more quiet when it came to present her solution. She just sent it by an e-mail, and asked us to just pick up the phone if we’ve got any questions. Her solution was overall much the same as the first; it met our needs and wishes very well. However, we regarded the presentation of her solution as more or less a copy of the first supplier’s one and paid not that much attention to it, because we were so overwelmed by the first charismatic, process driven and professional salesman. The second one didn’t get a real chance to stick in our minds.

Several months later it was time to get into the details. You know, all those detail decisions to make: colors, appliances, equipment, knobs, countertops….etc. If you’ve any time been done a such big project as rebuilding a kitchen in your home – or any other major renovation in a house – you certainly know what I’m talking about. For sure, you can’t do it alone. You need an expert to talk to.

  
And now the expertises of the two salesmen were revealed. The first one – the charming sales guy we fell in love with – he just didn’t manage the situation. All those hundreds of detailed questions we had to get answers to, were left to general responses, references to their website, guesswork or just not responded at all.

In the beginning of this intense decision making phase we, first just to be polite, we asked also the second supplier these detailed questions. All in all, she had put a lot work into her proposal, so why not? But her answers were rapidly back to us with advices from a real expert attached. Sometimes we couldn’t phrase our questions by ourselves, but then she did it for us. Several times one answer led to another question we couldn’t tell from start but the answers came timely, accurate and always with a smile.

In the end we found ourselves completely impressed by her and extremely sure our new kitchen will be just as in our dreams. Of course we selected her as supplier.

How come the first guy didn’t make it? Actually, he did all well by the book. He got a fantastic sales process to follow, told all prepared questions, was charming and made the social game to excellence. I think most salesmen in the world are molded in that way. The creepy part is also that management follows up in this way, so no salesman can leave the beaten track – one size fits all…

No room for a Barefoot Sales Process at all.

To be honest, what went wrong? Of course, the first salesman didn’t had the deep knowledge of what he was selling. And here’s my point: Expertise outperforms process. Everytime. The tricky part is how to find salespersons with that expertise. Think about it; it’s an engineer in a salesman’s suite. That’s really hard to find. 

In general you’ve got two options; 

1. Train an engineer to become a salesman
2. Train a salesman to be an expert on what he is selling

To establish (1) is nearly impossible and providing product knowledge on an expert level to a salesman as in (2) takes long time and is really costly.

Instead, I’ve got an easier (?) suggestion. In my Blog post Sales people are heroes – how can we help them I mentioned three properties that distinguish a Super Hero in sales from an ordinary one:

• Extremely high creativity skills
• Very interested in customer needs
• Huge skills doing “matchmaking” between that need and the products or services that would be delivered (with several twists of course).

What I mean is, try to be CLEAR about your work descriptions and to SUPPORT your sales heroes, so they are able to provide:

Answers rapidly back to her prospects with advices from a real expert attached.

Then your prospects perception of your salesmen will be as real SALES EXPERTS.

Best Regards 

Stefan

Starting in the right end – marketing and sales collaboration

As usual I have been reading up on what is going on and I came across this blog post: Marketing Bingo – You Might Be Playing And Not Even Know It. I have never been part of working within Marketing, so there might be something I’m missing, but for me Kyle makes a good point. Work from the outside in…

I started to think about how I percieve marketing, wich is more inside out: Who are we selling to? Is this changing? Can we see any trends? What precision can we expect in the conversion from Lead to Opportunity? How do we segment the market? How do we process the leads when they come in (different approaches based on segmentation)?

From a B2B sales perspective, the marketing actions need to create leads or make the lead creation possible. In order to give the sales organization a fair chance to sell, the leads need to be half decent or the customers need to be interested. There needs to be a common approach on the pipeline effeciency, in my view this is Gross Margin, taking all costs in account.

I made a model (probably exists but I could not find it anywhere) I would like to get some feedback on:

If Sales and Marketing create a plan that does not reach the intended market they have an “Ineffective Strategy”. If Marketing reaches the market, but these recipients never come in contact with sales, then we get “Uncaptured Lead”. If Sales work the Market in order to reach the quota and land prospects without the support of the Marketing we have a “Lead Deficit”. When Sales and market work the market in the same area we hit the “Sweet spot”.

Companies need to find a way increase the collaboration between sales and marketing to get better at targeting the sweet spot. First of all you need to have a common picture of what market looks like, what you want to achieve and how this transforms into customers.

An example

If we look at how this can be done, let’s start with a segmentation of our customer:

Let’s say that S1 is Low price/Low complexity, S2 is Low Price/High Complexity, S3 is High price/Low complexity and S4 is High price/ High complexity.

If we study our customers purchase behavior the last 12 months we find that we have a strong tendency to land in the S4 segment:

Looking the Marketing we are targeting the following area:

Looking at this picture it is easy to see that there is untapped potential. What needs to be cleared out is if Marketing I over reaching / targeting the wrong market, or if Sales are missing out on Prospects because they have the wrong approach to the market. Wouldn’t you like to know why and correct the situation?

My thought is to try and move the circles by increasing the collaboration and  achieving a higher efficiency in the sweet spot = more results with less work:

Stay tuned…a blog comming up on the topic of “Lead Profiling”, how to increase the “sweet spot”…

Why KPI’s both matter and don’t matter.

I can see that there is a lot written in the areas around measuring performance and that this cripples a companies’ creativity, that this can suffocate a company.

Two blogs i recently enjoyed reading on the subject are Barefoot Sales Process and Look Past the Measurements.

The purpose of a KPI usually comes with good intentions, but as they say…

The road to hell is paved with good intentions

We cannot ignore the fact that KPI’s are extemely powerfull, used in the right way with the right measurement.

I am a runner, as my VP Stefan is. We both have set the goal of running Lidingöloppet (30k in tough terrain). We discuss running a lot, we have totally different approaches to running. Stefan runs with his gut, if it feels good, he is content and as a goal for the race his ambition is to keep a good pace, but to leave some energy for the last 10k. He has no program, he will run as often as he can and run as far as he feels like at that time. I have a different approach, a set target for this race, a time I want to achieve, so I have put together a training program based on last year’s training program. I have a goal and a plan.

My strategy is to train hard without getting injured. My vision is to feel good, to feel fit. This is where Stefan and I agree.

My plan is ambitious. To achieve the goal, I need to train in tougher terrain this year compared to last year. I have two KPI’s for operational measurements, two for tactical, and one for reaching my goal.

Operational
For each training in the plan there is a purpose of how it will influence my physique. So as operational KPI’s I have heartrate and pace as a feedback every 5 minutes. This helps me pace my training to reach the development it intends to provide. After each training I try to reflect on the general feel of my health, to see if I am in tune with my strategy.

Tactical
Every week I look at the summery and how it compares to the other weeks. My KPI’s are average pace, to see if I’m moving in the direction, and distance, because I need to reach a certain level of endurance. The distance is a measurement that needs to be in line with my plan. If I don’t reach the distance I could change the plan for the week to follow.

Goal
To reach my goal I have one KPI and this is my best pace, this needs to go down to a certain minutes per km and then stay below this level.

Now all I have to do is stick to my plan, no matter what the weather is or if I don’t feel like running.

There is no right or wrong in the different approaches, but in Stefan’s case it would be a waste of time to use my KPI’s, even if we were to have the same goal.

This is where the confusion begins
The tricky part is if we are asked to pass on our experience, or if we are supposed to report our progress to a coach. Once again, the right KPI’s are of value, but not without presenting the correct arguments. You need to sell the KPI to the people providing the information. There needs to be a clear understanding of:
1. The purpose of the KPI (WHY)
2. When is the result presented, what frequency (WHEN)
3. How to report, how to read the result (HOW)
4. Who takes part of the report (WHO)

If you get a buy in on all points there is no problem, if you don’t, well you might have your work cut out for you…

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.

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

KPI:s before the sales process starts

In my last Blog post The Death of the Cold Call I described a trend that has become more obvious the recent year; the customer buying process has been ongoing for quite a while before the sales process starts. The consequense is that you cannot influence that much you could before, because of much more informed customers. The customers put you on their short list, not you. The phases Lead and Qualification are becoming obsolete very quickly having no registered sales activities.

SInce we cannot control it anymore, should Sales then hand-over this part of the process to Marketing? Well, it depends. The discussions in the forums are there and people’s opinions deviates which is the most suitable. Marketing is good at communication of the brand and what it stands for. Promoting the brand in these phases is really important, but could you just exchange Lead or Qualification activities with more marketing?

I’m not sure. I think it’s still Sales responsibility to refine and qualify a Lead, even if there are no obvious sales activities. But if ordinary sales activities are gone, what comes instead?

Let’s suppose the definition of Lead and Qualification are like “sort of need any of the companies in our target segments have and the activities to clear out if it’s something for us”. Typical sales activities to create (or catch) and Qualify such Lead would have been:

• Prospect calls in
• You call the prospect (cold call)
• Prospect leave interest on your website
• A trade show
• Timeframe within …
• Budget allocated
• Decision maker identified
• Product fit

Now. If most of these activities aren’t visible anymore, how and what can you do instead to survive the early phases so you will be one of the short list members? And how can you construct a KPI that drives you there? It’s about communication – and what types are relevant for your company. A simple method constructing a new KPI is using the PDCA: Plan, Do, Check, Act.

Plan-Do-Chack-Act based on a solid communication plattfolm.

Then consider what new types of “sales activities” would be replacements for the above ones. Here’s some examples:

• Investigating and register for X forums or discussion groups in your industry
• Growing the number of connections in target networks
• The number of comments or likes in discussions
• How many started threads within your product range
• The number of discussion threads (within your business area of course!) started by you
• The number of blog posts per month
• Referrals to your comment or Blog post
• Number of net followers
• Number of decsion makers taking part in your discussions or comment on your input.

As you may see, it’s not easy. But mostly it’s not easy because we aren’t used to it. Our experience is not covering what is a relevant target figure – what would be enough? And how can we measure hitrate? I think you can’t direcly, but if you measure some of the above and compare the result over time, you can have the trend for sure.

After all, it’s just surviving.

Good luck! Stefan

Checkout the Sales Scenario app for iPad, thanks.

 

 

The death of the Cold Call

I’m sooo tired of sales persons calling me. A completely unknown person steals my time. Since it’s working time it’s my most valuable asset! The cold call itself is a one-directional intention of contact. There are no possibilities knowing if there are mutual interests before the rep calls. How can those companies authorize the destroying of their own brand year after year? Are there more clever and modern tools to connect with prospects early in their buying process? The phone was invented over hundred years ago. It seems that using it as the major tool in prospecting has come to an end.

Dating for its own sake? 
Several years ago I met a client that told me they would totally focus on the “dating” part of the sales process. By the “dating part” he meant to segment a suitable number in the CRM database every Monday and book sales meetings for the coming week. Tuesday, Wednesday and Thursday were field days performing those sales meetings. Friday was the reporting day to management. And so the pace went on and on, for weeks, months and years.

At first, it was enough with 6 meetings a week for a rep to perform, but after a while the pressure from management and owners pushed the number up to the levels of 7, 8 or even 9 meetings per rep. Last time a spoke to them every rep has to perform 12 sales meetings every week to be on the gold side. The consequense is that the prospects are flooded by more and more stressed sales people just trying to keep the pace of booked meetings, not stressed helping you.

Getting first touch too late
Recent reports and my blog post Early Customer Buying Process… tell us the customer buying process has been ongoing much longer before the sales process even is started. That’s mean your sales process starts when the prospect already has done the major part of their homework before they get in touch with a sales rep.

The thing is: You don’t call the prospect; they call you. Or not. In other words; if they have found you, if they believe you’ve got an interesting product, if your brand is strong, if you already have any relationships and so on.

The risk not being contacted at all is huge. Can you afford that risk? And even if you would be one of the chosen ones, the only part left to shape would be negotiation of price and terms.

The new generation way of connecting
I sat down with my son last week. He studies international marketing and he needed my help filling in a form to the authorities. He smiled about the fact the form was in paper, not a web service on the net. It was so old-fashioned he told me all the time. When the form was filled in, he was roaring with laughter. The paper form must be put in an envelope, with a by hand written address (approximately in the right position of the front side of the envelope), he had to buy a stamp and, finally, he had to wait several days until he would get any feedback!

You may laugh, but this was the first time ever he posted an ordinary letter. You may think he’s too young or that my parental education is a joke? Well, think of the fact in just three years from now he would be influencing some decisions related to your business. Even using e-mail for communication is too old-fashioned in his mind. Instant action and reaction is essential for the new generation way of connecting. They are grown up with internet, fed with Facebook, Twitter and Instagram in mother’s milk, are online-alltime and never installs a local program on their computer – they don’t own any. Softwares are services and they like to try instead of buy. They know exactly what products you sell, your weaknesses compared to your competitors and even got referrals long before you would ask to send your case studies of your most loyal customers to them.

Summary
First thing is to stop destroying your own brand. Discontinue using the phone as a tool if you don’t know the recipient. Second; start take part in industry forums, blogs and social networks. Try not to sell, try to help. Even if the buying process would be invisible you will increase the possiblility they will contact you later on. And last, but not least; be prepared of people like my son soon will be the decision maker of your deals.

Would you make a cold call to him? You’d rather wait…

Please download the Sales Scenario app for iPad, thanks.

Take care / Stefan

Niche marketing defeats large competitors

Just finished reading David and Goliath by Malcolm Gladwell. In the book Gladwell tells how apparent weaknesses instead may be to your advantage. Gladwell references to research regarding successful entrepreneurs having dyslexia in larger extent than others. Resistence and difficulties, Gladwell tells, are driving forces seeking alternative and maybe “odd” ways to success in life and business.

Another example in David and Goliath is Caroline Sacks – a very talented student with top results all years until she went for University studies. She chose between Brown and Maryland for studies in Science. Brown is one of those elite schools, while Maryland is only “good”. Sacks chose Brown.

Sacks loved science, but after just a short while she left University without finishing her studies. Why? According to Gladwell she found herself not being the No 1 for the first time. Gladwell points out if Sacks had chosen Maryland she had still been in Science; it’s better being a big fish in a small pond than a small fish in a big lake.

It’s like niche marketing – being a market leader in a tiny vertical is many times regarded as a successful strategy. Reconnecting to my blog post Strategy Myopia (inspired by Marketing Myopia by Theodore Levitt) I was discussing companies’ strategy defined too narrowly. However, that’s may not always be true for Marketing.

According to Geoffery A Moore, and theory of Crossing the Chasm implies that marketing in very niche segments to achieve market leadership is essential for fast and organic growing.

Moore points out success against established competitors requires seeking niches where you can be The Number One and act from that point. Why? Because most buyers hates risk and therefore prefer established market leaders.

The tricky part is to find a very tiny vertical, but with potential adjacent – and tiny too – niches to expand to. Moore describes this as The Bowling Alley, where the bowling pins are the niches. If one pin falls, it’s likely some of the adjacent will fall too. The result is a wider market leadership managing several niches in one big, recognizing you as The Number One. Pragmatic and Low Risk Buyers start turning to you instead of their former established suppliers.

Summarizing, the process starts when you are under pressure and you think about giving up. Difficulties and inferiority are really good things; they are the sparks thinking differently, finding other ways. Such way may be your first niche. Having a wider strategy, you would think of several adjacent verticals, but you start only with one. Select one where you got good customers with strong success stories.

Best Regards
Stefan

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