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Solving The Seller’s Paradox
As I shared in my post last Monday: Stop Selling! If you’re selling you’re doing something wrong.
Whenever I share this insight, it’s always greeted with agreement…and frustration. People shrug their shoulders and ask, “I get that I shouldn’t do this, but what should I do?”
Solving The Seller’s Paradox requires that you fully and completely leave the world of the peddler. You must let go of your products and services, your features and benefits and engage – truly engage – with your prospects/customers. You must embrace a diagnostic approach.
The basis of this approach is rooted with what I call The Three Sale Mindset™. A successful sale is really the culmination of three distinct “sales.” They are:
- Agreement defining the problem.
- Agreement defining the best solution.
- Agreement defining the best provider.
The problem with traditional sales (and with about 95% of salespeople) is that they’re completely programmed and focused on making sale three, and as a result skip steps, assume and commoditize.
Diagnosis is all about focusing on the first sale, and realizing that you don’t really have a prospect until you have clearly and mutually agreed on what the problem is, the impact of the problem as well as its priority.
There are three distinct decisions that must be reached in The First Sale™:
- I (the prospect/customer) have a problem.
- A clear definition/description as to what the problem is and the underlying cause.
- Determination that the status quo is no longer viable, and that change must occur.
It is critical to understand that The First Sale has not been made until all three points have been met. It is not at all unusual (actually, it’s the norm) that salespeople move forward when only the first and third points are being communicated.
When a prospect/customer reaches out to you claiming to acknowledge a problem and desiring a solution, if you assume that they either a) understand what their problem really is, or b) are truly committed to solving the problem once they learn everything that is involved you are moving into false positive territory – and you’re peddling!
When you slow it down and spend the necessary time to ensure that all three points are covered, you’ll find you move beyond competition and begin to get treated like the trusted resource your should be. Focus on The First Sale, and you’ll see the next two move through faster than ever.
Networking – Online & Off
Recently, I’ve gotten a number of questions from clients and others about effective social media. It seems a number of people a wondering if now is the right time to jump on the bandwagon.
I was recently interviewed by The Strategic Coach on the subject. They combined my thoughts with insights on networking in general (which I thought was a great idea). You can read the article here.
Here are some of the highlights:
- Networking is networking. The rules for offline networking are precisely the same for online.
- The biggest mistake made with social media is that people view it as a strategy – it’s not. Social media is a tactic, used to support a strategy towards a specific result. If the result isn’t clear, the strategy will be bad, and your social media efforts will be useless.
- Social media is a horrible broadcast mechanism. If you’re think you’re going to use Twitter, Facebook or any other platform to tell the world what you’re doing, and that the world will then respond – don’t waste the time.
- Social media is good for connecting, engaging and pointing. If you’re not planning to actively participate, and build content to support your efforts, then you’ll be much happier doing something else.
All that said, social media, and by extension the creation of meaningful content to share, is increasingly becoming mandatory. Imagine the biggest conversation in the world taking place. You’ve got to answer a simple question – do you want to participate in the conversation or be left out?
If growth is imperative, the answer is simple. It’s the execution that’s tough.
They’re Not Ready
The single biggest, most common, and most expensive mistake made by salespeople occurs when they go to their solution too early. The biggest cause of this mistake is the apparent readiness on the part of the prospect to hear about the solution.
The nature of most small and mid-market organization’s sales and marketing efforts leads to the primary contributor of this problem. 80% or more of the time, salespeople begin their interaction with the prospect after the prospect is looking for a solution. When they first meet with a prospect, or when a prospect first reaches out to them the conversation typical begins with the prospect asking them about their solution.
In my 25 years of selling and advising others in the sales process, the most important lesson I’ve learned is that just because the prospect asks about the solution, or appears ready to make a decision does not mean that the prospect is actually ready. Quite the contrary. At this point in the process, the prospect is not ready to understand the value of your solution, or the difference between what you do versus what your competitors do.
When the sales conversation begins with the prospect asking about your solution, the most effective thing you can do is to slow the process down. Ask the prospect why are they looking for a solution. Spend time clarifying and deepening your understanding of the issues and problems that the prospect has that leads them to believe that they need your solution. Ensure that they understand what’s causing the problem every bit as much as they understand the solution and the results they desire.
The time you spend gaining a fuller understanding of their issues will also help them gain an understanding of their issues as well, and even more importantly gain an understanding as to how your solution is different and better than that of your competition.
When I share this advice with salespeople, they all nod in agreement. When I ask what prevents them from acting upon this advice, the number one response is, “Well, the customer is asking me to explain what we do; they don’t want to take a step backwards.”
Please know, digging deeper and diagnosing IS NOT taking a step backwards. It’s taking a giant step forward by demonstrating that you are not merely a peddler of products, but a true advisor that will enable them to solve problems and achieve critical results.
Don’t Be A Pigeon (Why Selling Is Dead)
Traditional selling techniques are no longer effective in the twenty-first century. A study conducted by Harvard Business Review revealed that only 1 in 250 salespeople actually creates positive economic impact for their companies, and less than 37% of salespeople meet a profile deemed to be “effective.” It is time to end the traditional approach to sales, where most salespeople are considered pests or peddlers and transform that approach so that salespeople are perceived as the valuable assets they can be.
Through 20 years of research, I have learned that the problem is a systems problem, not a people problem. To drive profitable growth, companies must adopt new systems, develop new skills and apply new disciplines to be effective. The good news is that companies that make this transformation gain disproportionate rewards – often 5 to 10 times average rates of return.
The fundamental problem with traditional selling is that it structurally places the focus on the commodity value. If your goal is differentiation and earning margin premiums, then you must work against traditional selling tactics. For six years, the focus of this blog has been to support the development of a better approach to selling. Consider this post a 30,000 foot review of six years of content (with the links to previous posts to support it).
Here’s the problem with traditional selling:
- It is solution-focused. When you begin with the focus on the solution, you are focused on the commodity portion of your proposition. As I’ve written before: solutions are worthless – until there is a problem.
- It views your difference as a “value-add,” rather than as core to your proposition (think IBM pre-1995).
- The playing field is defined by your competition, and the focus is “winning the business.” This make the process far more adversarial than it should be. From a customer perspective it makes it a hodgepodge of “sameness.”
- Because it’s solution-based, the go-to-market focus is broad; too broad. The approach is based upon “who can use the solution,” rather than on where the selling organization can be best.
- The sales and marketing approach are silo’d within the selling organization – leading to misalignment, confusion and brand degradation.
A new, far more effective model of selling flips these issues on their head. The focus is on creating value throughout the entire sales/marketing process. Rather than merely fulfilling demand (which is akin to being a pigeon trying to compete for a piece of bread) the focus is on creating demand – what I call Demand Creation Selling.
- It focuses on critical results – and the barriers that prevent those results – rather than on solutions. It focuses on the problem, and enabling the customers/prospects to better understand their problems and the causes and consequences of those problems.
- Rather than viewing your difference as the “value-add,” it focuses on your difference, your business’ intelligence if you will, as the core of your offering. I refer to it as making The Shift from selling stuff to selling your ability to create results.
- The focus is on creating demand (and markets), and as such, you eliminate competition and you own markets, rather than compete.
- You focus and allocate your resources where you can be the best, and you ignore areas where you’re a “me-too” company.
- Instead of focusing on the solution, Demand Creation Selling means that you manically focus on understanding customers – better than the customers understand themselves.
- Sales and marketing are fully integrated, and the company goes-to-market in a clear and powerful manner. There is no need to differentiate, because you are different.
- Expertise is defined by how well, and how deeply, you understand your customers and their issues, rather than how well you know and understand your solution.
Growth is tough enough as it is. Businesses can no longer rely on systems and approaches that work against them. The time has come to change the way you sell – and the rewards await.
Go Deep & Shorten The Sales Cycle
The importance of asking questions in selling is, well, unquestionable. Much (some may say too much) has been written about the what’s, how’s and why’s of asking questions in sales. What has not received much attention, however, is the importance of assessing what level of information salespeople learn from the questions they ask.
In my experience, there are three levels of information (or knowledge) that salespeople get from asking their questions. The deeper you get, the more valuable the knowledge and the greater your selling advantage. To make The Shift to selling results it is necessary that you get to Level 3.
- Level 1 – All about the transaction. You gain surface knowledge only. The questions are all aimed to assess the “need” for the “stuff” you sell.
- Level 2 – Moves below the transaction to the impact your product/service can have. This is a significant improvement from Level 1. The weakness here is that it’s still all about the product/service and not about the customer/client. If you’re involved in a simple sale and/or you are selling something that fits all of the buyers criteria (budget, specs, process, etc.), Level 2 information is often enough.
However, if you’re involved in a complex sale where multiple people play a role on the buyer side and their desires don’t align, you customer is unclear about their needs or yours, and the buyers assessment don’t immediately align (say, you’d like to earn a premium margin), then Level 2 information is not enough.
- Level 3 – Moves beyond the product or service your are selling and is all about the business results, and the barriers to those results, your customer/client is pursuing. Level 3 knowledge is critical if you want to radically differentiate your company and offerings or if you want to be in the “What’s it Worth ?” conversation that allows you to enhance your margins while shortening the sales cycle.
Gaining Level 3 knowledge is not as simple of merely asking a question and writing down the answer. It requires active listening and an reasonable understanding of your customers business and what drives their results. It requires the salesperson engage with the customer in a true dialogue for two primary reasons:
- The salesperson needs to earn “a seat at the table.” Customers are extraordinarily busy today and don’t have the time to spend with most salespeople.
- The bigger and more common reason though is that in the vast majority of situations the customer isn’t clear on the results they’re pursuing or the barriers that are preventing those results. Far more often than not, the customer/client is treating a symptom and not the cause of the problem. If all you, as a salesperson, do is address the issues as your customer understands them, it is unlikely that a) you’ll create any real value or b) gain any type of advantage in the sales process.
So, next time you come back from a sales call debrief your notes and analyze what level your conversation is taking place at. If you’re not spending half your time or more at Level 3, determine what changes you need to make to get there.
Being Liked vs. Being Valued
The entire concept of “relationship” is being radically re-created today. Last year, I wrote a post asking if what salespeople were doing under the banner of “relationship selling” wasn’t more akin to what I call “acquaintance-ship selling.” In the last year, I’ve had lots of conversation on this topic and I’m more convinced than ever that the post is totally on-point.
What I’ve realized is that traditionally sales “relationships” were about being “liked.” Salespeople were good guys and gals. They were easy to get along with. They made customers feel good. They took people to ball games and had big(ish) entertainment budgets. I remember sitting in a Tom Hopkins Boot Camp and reciting that my job as a salesperson was to get them to “like me and trust me” first and foremost.
The challenge is that being liked is nowhere near enough today. In a world of zero discretionary budgets, if salespeople (and selling organizations) want a customer’s attention they must be valued. And there’s a HUGE difference between being liked and being valued.
While by no means mutually exclusive, you can be valued and liked, these two attributes must be prioritized. If the goal is to be liked first and valued second (which by the way is the old school style – I’ll get them to like me then I’ll get them to value me), the behaviors will not support what’s needed to drive profitable growth today. You’ll be less likely to challenge or provoke. When the customer asks for a quote, you’ll be less likely to tell them they are not ready for a quote, and so on. You’ll be deemed irrelevant and, at best, you’ll be positioned to “catch” opportunities that happen to fit.
When you focus on being valued first and liked second, you’re far more likely to take on the behaviors to create demand. Rather than waiting for customers to tell you what they need, you’ll provoke their awareness. You’ll dig deeper, even if the customer is uncomfortable. You’ll talk to the people in the buyer’s organization that need to be talked to, even though your contact didn’t like the idea, and you’ll withstand the pressure of closing too soon, even though your customer is asking for a proposal.
Being valued means risking, even for a few moments, not being liked. Going forward, the only business relationships that will matter will be the ones where you’re highly valued, even if they like someone else a little more.
What can you do to increase the true value of your relationships?
Is It Time to Kill The Cold Call?
In my efforts to stay abreast of what is going on in the world outside my office, I follow the thoughts of several sales training and consulting organizations. Over the last couple of weeks I’ve seen a significant increase in the chatter surrounding cold calling.
While everyone has had a slightly different take on the practice, the thoughts were probably best summed up by @solutionselling’s blog post: Cold-Calling Beats Aggressively Waiting by the Phone…. EVERY TIME!
When I first got into selling, I wore my ability to cold call as a badge of honor. I remember when I started at Merrill Lynch, a good day was when I made 300 calls in a day, and on my “best” day I made 500 dials. I look back on my “smiling and dialing” days much the way a high school football player looks back at their “great” plays.
But, I got to thinking. I’ve built (IMHO) a pretty good business over the last five years and I haven’t gotten a single client from cold calling. When I look at the best clients I got when I was at Merrill Lynch, not one came from cold calling. Don’t get me wrong, cold calling has certainly helped me in my sales career. But, I wonder if it hasn’t caused as much harm and it has helped.
So, I ask you, Is It Time To Kill The Cold Call?
Here are my thoughts:
We first need to define cold call. There is absolutely nothing wrong with making a first contact by phone with someone who may not know you. If you are making that call with purpose, you’ve done some research on the company, you have a least a hypothesis of the problem they have that you can help address and you have a dynamic, multi-pronged account entry strategy to support that call; then I would not define that as a “cold” call. Let’s call these initial calls. In reality, if this isn’t the sole part of your job, you may be able to make 5 of these types of calls a week.
A cold call, in my opinion, is where you deliver a generic message to a defined (or not) group of people in an effort to generate interest. You know little to nothing about the potential customer and you script yourself (whether written or not) to create a “lead.” With this type of call, you can make a virtually unlimited number of calls..
Now the observations:
Pros:
- There is absolutely no tactic that can be taken on the part of a salesperson that will lead more immediately to creating a sales opportunity than cold calling – NOTHING. So, I agree with the post above that cold calling is far better than waiting for the phone to ring. The reason for this is that cold calling allows you to cover significant ground faster than any other tactic. By the nature of its force, you are able to shake opportunities loose. Now, these are not always (actually rarely) the best opportunities nor best positioned, but they do create opportunities faster than any other tactic. The post I referenced tells the story of a sales rep who continued to cold call a prospect for 18 months. My experience is that this rarely works – and I would challenge the rep with what he could have done to accelerate the process if he hadn’t relied solely on cold calling (and if he didn’t rely on solely on cold calling, then that goes against the author’s argument).
Cons
- Cold calling creates a lot of negative equity. Much has been written about interruption marketing, and I won’t re-hash the arguments here – they’re easy enough to find. While cold calling can thrust you into opportunities, it can also really irritate a lot of people and diminish your authority.
- Cold calling takes a toll on the salesperson. There are two types of people in the world: those who hate (or at least don’t like) cold calling – and those who lie about it. Cold calling is monotonous and forces a lot of rejection. No matter who you are, that eats energy.
- There is little leverage in cold calling. It works only as long as you are working on it. There are few, if any, strategic byproducts that come from it, and the only chance it has of working is if you continue to do it. If you get busy and can’t follow up on your calls from “3 months ago” as the post above referenced, you are basically starting all over again.
- What is it that they say about the first impression? Well another problem with cold calling is that it is the junior people who most often do it. Cold calling itself doesn’t require any unique skill set, however, managing the unexpected opportunities that arise in conversation does. So often, a very high-value salesperson is forced to do a low-value activity.
I could go on, but I think my opinion is becoming clear. That said, I do realize the underlying, even if un-desired, need for tactics such as cold calling. So my answer is that it’s not time to kill the cold call, but it should only be used as a tactic when absolutely necessary.
Here’s my prescription:
- If you are a salesperson responsible for more than just lead generation, your goal should be to get in position so you NEVER have to make another cold call within 18 months. Cold calling should be no more than a secondary or tertiary tactic within 12 months.
- If you are a business and you need this for lead generation, develop a highly specialized individual or team that is responsible for doing this – and doing just this. This becomes a marketing function more than a sales function. Additionally, you should hire a research assistant to develop more of the cold calls you are making into initial calls.
What do you think? Is it time to kill the cold call? What changes do you think we need to make to this tactic?
Stop Closing
Look, I like Glenngary Glen Ross as much as anyone. And Alec Baldwin’s famous scene where he explains that the ABCs of selling are A – Always, B – Be, C – Closing is one of my favorite scenes in any movie.
But, please, PLEASE, can we retire the myth that to succeed in sales you must learn to close early and close often? Can we drop the statistical mumbo-jumbo that you must ask for the sale at least five times before you have a chance to get it? (Neil Rackham destroyed this myth with research in his seminal book SPIN Selling. Remarkably, a couple of days ago I came across a sales consultancy’s website that claims it’s now NINE times.)
Now, I understand just how difficult it is to get people to make decisions. This is true in good times, and it’s especially true in difficult economic times. When I do sales training, I share the fact that decision and homicide have the same Latin root – they both mean to kill or to eliminate. Simply put, people hate to make decisions.
It is the job of professional salespeople to facilitate decision-making. The goal should be to facilitate a mutually beneficial, long-term decision – not to “close the sale.” The problem with the whole idea of “closing” and the idiotic idea that you’re supposed to “go for the close as early as you can and as often as you can” is that it naturally creates an adversarial relationship, and even worse, causes salespeople to miss or speed through critical steps that can both shorten the sales cycle considerably and create much larger opportunities. Four years ago, I wrote an article about the myth that objections are good. The focus on closing only increases the likelihood that you’ll trigger objections that diminish the selling organization.
You don’t facilitate decisions by closing. You do it by diagnosing, by understanding your buyers, and their critical results – better than your buyers do. You do it by being useful and creating deep, results-oriented relationships. You don’t do it by trying to artificially shorten the sales process through the variety of manipulative techniques taught under the banner of “closing” or by celebrating the myth of “the closer.”
So, are you with me?
Finding Demand Creators
Earlier this week, I wrote a post about The 5 Levels of Sales Excellence. It’s generated a lot of discussion, best summed up by this stream of comments:
- Rodney Johnson says:
Doug – you nailed this one. I can tell you that businesses are struggling with the peddlers and commoditizers in their organizations. If they could just find a few Professionals, they would be in heaven. If they could find a Demand Creator, they would have found Utopia.
So let me ask you. Where does one look? How do we evaluate? And are Demand Creators even available?
- Doug Davidoff says:
Rodney, that is a great question. I’ll begin writing the answer now. I’ll post it as soon as it’s done.
- Rodney Johnson says:
I thought about my question, and at least in my world working with CEOs through Vistage, I can say with certainty that the Demand Creators tend to be the CEO/Entrepreneur of the organization. They have the skill set. They have the business acumen. They have the connections. And they definitely have the drive. If this is the case, finding individuals out there with Demand Creation skills is likely a very elite and small group. Your thoughts?
Here are my thoughts:
First and foremost, Demand Creators and even most professionals are very rarely (to a statistically insignificant level) “found”; instead, they are made. The only meaningful exception to this, as Rodney points out, is found at the CEO and entrepreneur level. They create demand, most often, because they are the creators of the value for their company and can’t help but go deep and resonate with buyers. The challenge is that CEO/entrepreneurs create demand in a non-replicable way and that creates a “growth wall” that halts most companies’ growth.
While sales mythology is filled with stories of “natural” sales superstars, reality rarely lives up to the story. The only meaningful difference between these natural sales superstars, Demand Creators and unicorns, is that the sales superstar does actually exist; but they are EXTRAORDINARILY hard to find, they are very expensive and they are very difficult to keep happy. Peter Drucker said you can’t scale a business requiring genius, and the same is true here.
The Critical Element to Make Demand Creators
The prerequisite to make/create Demand Creators is a repeatable, sustainable sales and marketing process. This is where IBM destroyed its competitors in IBM’s heyday. IBM was a superior sales organization, not because they hired better sales people (actually, IBM had a huge advantage in their ability to hire younger, less experienced salespeople than their competitors), but because they had a superior process – in the full sense of the word.
This leads to another myth – salespeople hate process. Properly stated (and in the context of my post on Demand Creators) it is true: pests, peddlers and commoditizers hate process. Professionals and Demand Creators thrive on effective process.
Please don’t confuse a repeatable sales and marketing process with things like the stages of a sale. While I’m a big fan of a lot of sales training programs out there (and they’ve certainly inspired a lot of my thinking over the last 20 years), they do not represent process. At best, they represent stages. Whether you’re talking about Tom Hopkins, Brian Tracy, Miller Heiman, Neil Rackham, Sandler, Huthwaite, Bosworth, et al; they demonstrate stages, not repeatable process (please note, it is not my intention to slight any of these fine organizations, I think they all do a very good job).
Think about this for a moment. If you were interviewing an operations manager, front line worker, accountant, controller, CFO, or virtually any non-sales and marketing position and they said something like the following, would you hire them?
“Before you hire me, I want you to know that I have my own way of doing things. It’s worked for me for years so I’m going to do it my way, rather than yours.”
Of course not. Can you imagine an accountant saying they find GAAP just a little too constraining, so they’ll just ignore it (oops, I guess that’s what happened at Enron)? But companies let salespeople do this everyday. An effective process makes a decent salesperson good, a good one great, and a great one a superstar. (A superstar by the way is merely a great salesperson who follows a process – whether it’s a stated process or not.)
The reason a process works and is so critical is that an effective process introduces constraints. Constraints, properly applied, force increased focus – which leads to more depth. A salesperson can only create demand by going deeper than their competitors do. These constraints create predictability, which is critical to effectively allocating resources (which for a salesperson really comes down to time). As author, professor, and consultant Jim Collins has said, if you take the person out of the process, the person is no longer as good.
Further, a repeatable process is, by definition, trainable and coachable. This means that you can hire people who fit a particular profile (as done in any top notch hiring process, and a subject I’ll write about shortly) and teach them how to do this. This makes the position hirable and it enables a company to ensure it can continue to grow.
The problem that the vast majority of small and mid-market businesses (SMB) have is that they have neither the time nor the expertise to create such a system. So they either rely on the salesperson to “figure it out,” have absolutely no system or overly rely on the “systems” presented in sales training programs (which as I’ve already mentioned are not adequate substitutes for process).
I know this because for the last five years a core focus of my company has been helping SMBs create these systems, and we’ve been helping companies make their sales teams professionals and Demand Creators.
Are You A Pest, Peddler or Demand Creator
For the last 20+ years, I’ve spent my life working with businesses and salespeople. I’ve seen quite a bit change over that time – things that have both encouraged and discouraged me. On the encouraging front, I feel confident that today, the best, most capable and professional salespeople are there. Despite several calls for “The End of the Salesforce,” there are salespeople creating more economic value for both their employers and their buyers than ever before. Today, more than ever, the need for highly trained, capable salespeople is a must-have for businesses.
On the discouraging front, everyday, I see a majority of salespeople failing to create the very economic value that exist to create. While many salespeople have truly become professionals and executives, the overall “center of gravity,” if you will, of the sales profession has not moved markedly. This is damaging for two compelling reasons:
- First, in today’s ultra-competitive marketplace caused by the recent drought, salespeople cannot afford to be anything less than excellent to create economic value for the selling organization, and
- Second, the overall lack of professionalism and value creation on the part of sellers is causing an exponential increase in the number of buyers who actively finding ways to avoid dealing with salespeople altogether. They figure that since so many salespeople are commoditizing themselves, they might as well just treat them that way. This had led to the rapid increases in RFPs and the increase in power of procurement in buying processes.
Part of my company’s underlying mission is to end all of this bad selling and to support the understanding and growth of the strategic importance that sales and salespeople have. So, for the last 15 years, I’ve been keeping copious notes on the difference between bad salespeople, decent ones, good ones, and great ones. This has led to the creation of what I call The 5 Levels of Sales Excellence. Understanding these levels is important to ensuring that your sales efforts create value.
The 5 Levels of Sales Excellence
At the bottom are the pests. These are the salespeople who just go out and bother people. Their disciples of the “sales is purely a numbers game,” and gosh darn it if they don’t go out there pushing numbers. They’re the ones who show up at a networking event and greet all comers with the battle cry, “Nice to meet you, here’s my card.” They’re poor at asking questions, they don’t listen and they extract value from the process. The biggest problem they represent (even if you don’t have pests on your team) is that it is the profile of the pest that first comes to mind, and is most associated, with salespeople. When executives in your buyer’s organization here a salesperson from your company is coming, pest is the picture that comes to mind, even if they know that your salesperson isn’t one. So, you must always manage against this perception.
The peddler is focused on the “stuff they’re selling.” Often times, they’re great conversationalists (in that they can tell some terrific stories and have much charisma), and they play the part of resource, but you know you’re dealing with a peddler because they spend far more time talking than working to understand. Their “solution” is always the right one “if you’d just understand.” Peddlers don’t listen well, when they ask questions they’re not high value questions, and they don’t “go deep”. A peddler focuses on getting to the presentation/proposal/recommendation as quickly as possible and firmly believes that you have to ask someone to say “yes” five times to have a real chance at success. They thrive on objections, as they’re “buying signs.” Peddlers create little or no value in the sales process, and as a result they lengthen sales cycles and increase sales costs.
I used to call the commoditizer a “professional peddler.” The commoditizer is clearly focused on the solution. Typically, they have a significant level of expertise when it comes to the solution, and they believe firmly in it. Commoditizers ask a lot of questions (they’ve learned that’s important in selling), but the questions are very low value questions, and do not provoke and probe deeper issues. The problem the commoditzer has is that they are so clear about the solution that they suffer from the curse of knowledge. This means that to be fully understood and valued, the buyer must fully understand their problem (which they rarely do). Because they are so focused on the solution, buyer’s don’t view them as important until they have already decided that they need what the seller provides. At this point, decision criteria have been established and the buyer is typically in a shop mode, price becomes increasingly important in the selection process and differentiation is difficult (hence why we call this level the commoditizer). At this level, the sales person is doing an awful lot right, but because they are solutions focused they do not create value.
Important Point: This brings me to an important point. If the focus of your go-to-market efforts is on your solution and attempting to “explain why your solution is best” rather than on diagnosing you buyer’s issues, then you are peddling or commoditizing – at best!
The professional is focused on what the buyer needs. It is the professional that begins to earn a “seat at the table” and is viewed as an important player by the buyer. Buyers value professionals because they know that their best interests are being looked after. Professional’s ask high value questions, probe deeply and help to refine the decision criteria. Professionals create value in the sales process. Their primary drawback is that they limit their focus to the direct issues that their solution addresses and they rely heavily on “treating” the buyer’s awareness. While they do diagnose, they are not diagnosticians, so if the buyer is misunderstanding their problem or is merely aware of their symptoms, professionals will struggle in changing the perceived need, hence, they do not create demand.
Which brings me to the fifth, and highest, level of sales excellence: The Demand Creator. Demand Creators are superstars and when you think of them, you rarely think of them as “salespeople.” When Demand Creators sell (and believe me, they’re the most powerful sellers there are), it doesn’t feel like selling. Demand Creators are completely buyer focused, possess a tremendous degree of business acumen, and are viewed as critical resources by their buyers. Demand Creators have mastered results oriented conversations with buying organizations, have the ability to speak to a variety of levels of buyers and create value in everything they do. Demand Creators are tremendous advantages to their selling organizations, the selling organization doesn’t have to worry about “differentiating” because the Demand Creator is different. The Demand Creator is able to take the conversation with a buyer so deep that they eliminate competition. Demand Creators are comfortable that not everyone should buy from them, and that “now” may not be the best time to solve a problem. While Demand Creators work very hard, they make selling look and feel effortless. When you’re working with a Demand Creator, you know it.
So, where are you – and why? What stories can you share about salespeople you’ve encountered at each level?
Selling Is Not War
I admit it. I’ve used military analogies from time to time to explain both strategies and tactics. War analogies are easy to use, easy to understand - and easy to misapply. For years, I’ve written about the various myths of selling, but the one that just gets my goat is this one – Selling Is War.
Recently I came across a sales oriented blog that finished their message on selling strategies with this paragraph:
If you are in sales, you are perpetually in a state of war. All salespeople are warriors who must fight the relentless march of time and enemies who are trying to defeat them daily. Sales is an intense hand-to-hand battle fought between two people or two groups of people who are each trying to win over the customer. The victor outsmarts, outmaneuvers, and overwhelms his enemies. In sales, just as in war, there can be only one winner, and today’s conqueror can quickly become tomorrow’s vanquished. The deciding difference is strategy.
If I searched the world for one paragraph that was at the focal point of what is wrong with selling, I could not find one better than this. What scares me about this, and why I’m pointing it out in this post, is that I think a lot of executives and salespeople believe this philosophy.
After reading the paragraph a couple of times, I admit that I’m not sure whether the author is saying that the customer is the enemy, the competitor is the enemy or both. What I do know, is that author is clearly communicating that sales – at it’s core – is a win/lose proposition. And this belief is at the core of why businesses are being so relentlessly commoditized.
Let’s be clear – SELLING IS NOT WAR; and any allusions to selling as war make your job as a fast growth executive or salesperson more difficult. Is it any wonder that top performers and brilliant salespeople bristle at the idea of “selling.”
The reality is, selling done right, is
• A win/win proposition
• Collaborative
• Creative
• Value Creative
• Fun
War is rarely, if ever, any of these (and the war referred to above is clearly none of these). So, let’s drop the silly war analogies, and get back to creating value for our prospects, customer and clients. When you do that, your competition (the enemy) becomes irrelevant.
Understanding the Difference Between Conditions and Barriers
Earlier this week, we were working with one of our client’s sales reps to develop their sales strategy for an account. We teach a very effective structure for any sales presentation. The key to the presentation is to first focus on the results that your buyer desires (this is harder than it looks) and then to identify the barriers that are preventing your buyer from achieving those results. The more fully you identify the barriers, the more effective your sales presentation will be – as that is the key to your value creation. If you’ve clearly and fully identified the results and barriers facing your buyer, then selling is one of the most effortless pursuits there is (of course, the challenge is fully identifying the results and barriers). On the flip side, if you have not fully and clearly identified them, then selling can feel an awful lot like trying to breakthrough cellophane.
The rep we were working with made a very common mistake – he was confusing conditions with barriers. Most sellers, especially those that purport to be “solution selling,” sell to conditions rather than barriers. Commoditizing themselves even more. As a selling organization it is critical that you understand the difference between conditions and barriers.
- A condition is any circumstance or situation where a company finds itself. Some conditions are negative and some are positive.
- Barriers are the reasons that a company is unable to either a) overcome a negative condition, or b) increase the momentum from a positive condition.
For example, let’s say that ABC Company is looking to double its revenue over the next five years, while increasing its net margins by 10%.
So, you ask the barrier revealing question: “What is preventing you from getting there?” They respond:
- Poor sales effort.
- Ineffective management systems.
- Too concentrated in one area of business.
- Heavy competition.
Those four points are conditions – not barriers. That’s their self diagnosis; it’s what they are already aware of. If you begin “selling” to these conditions, you are no different than every other salesperson that is selling to them. Think about it for a moment – the mere fact that they’ve shared these four conditions with you proves a) they are already familiar with these issues, so addressing only them creates no value; and b) addressing only these issues will not solve the problem – if it would, your buyer would have already solved the problem. As a seller, your job – and the only way to truly and effectively differentiate yourself from the peddlers out there – is to dig deeper. That is what diagnosing is all about. The powerful questions should be focused on why the buyer has been unable to overcome those conditions.
If you’re thinking, “But they don’t know the answer to that question;” then you are on to something. Salespeople create value when they ask questions that buyers do not easily have answers for. Every time I speak about Creating Demand someone says to me, “But, Doug, there is nothing we can say that our competitors can’t also say – even if the competitor is not telling the truth.” And I agree with that sentiment. While there is nothing you can say that can make you radically different there is plenty you can do. And the first step of what you can do is to dig deeper and help your buyers understand their barriers.
Before I give you some examples of barriers, let me highlight two critical points. First, barriers are as unique and unlimited as there are companies out there buying and selling – these four conditions could have any of a thousand barriers. Second, the barriers that are uncovered are going to have a lot to do with what you are selling, or the “solution” you are providing. For example, the barriers I’d uncover would be very different from what an accounting firm would uncover, or any other company. That said, here are some potential barriers for ABC Company (from my perspective):
- Poor sales team structure
- Inadequate or misaligned compensation
- Poor messaging
- Diffuse value proposition
- Lack of accountability
- Poor offering
- Old offering
- Poor hiring/recruiting
I could go on and on. You know you’re addressing a barrier when it is clearly a cause for at least one of the conditions – and most likely for several of them. It’s a barrier when it directly relates to an action the company can take – or avoid. My job, as a salesperson is to have the conversation with the client to narrow potential barriers into a critical list of 3 – 5 that would have the greatest impact towards driving their results. When you do this, you are communicating with your buyers at a level that none of your competitors can. You begin to sell something wholly and completely different than your competitors. Price stops being the driving issue, because your buyer begins to understand through experience that you are different – and better. And that by paying a bit more they may actually solve their problems.
Be My Fan – Please?
Early in my sales career I was given some of the worst advice ever – it nearly destroyed by career. “It’s a numbers game,” I was told. If I could rid the world of one destructive, commoditizing thought it would be that piece of advice.
This philosophy shows up in a number of places. Most recently, it has shown itself as more and more businesses are turning to “social media” to drive the outreach programs. As more and more small and mid-size business (SMEs) executives and salespeople are looking for new ways to stand out, they are experimenting with things like LinkedIn groups, Facebook pages and Twitter. I applaud this effort – however, please stop demeaning yourself by begging and peddling for “fans.” (For those that are not familiar with these tools, fans simply means people that decide to follow your posts and/or be alerted anytime you put something up on one of your pages.)
I’ve lost count of the number of requests I’ve received recently asking me – no, begging me – to become a fan or follower of their new endeavor. This idea is clearly rooted in the idea that if more people are “fans”, then you must be more successful. In reality, this is just another example of modern businesses taking a quantity/volume approach over a quality/profit approach. I am not impressed by the number of followers you have,nor is any reasonable person that I am aware of. I am, however, impressed by the quality of followers you have. One of the ways I judge that is by judging the quality of your content.
It’s funny, I’m a big (BIG) Bruce Springsteen fan – seen him more than 30 times and I’ve got tickets to see him several more times this year, plus I’ve turned on hundreds of people in my life to his music – and he’s never once asked me to become his fan. He takes the harder route – he did (and continues to do) something great and I became a fan. I’ve found this principle exists in business today – those that ask me to become a fan provide the least value; while those that provide great value never feel the need to ask. The more we pursue fans (remember, that’s short for fanatical) who are not really fans, the more we reduce the impact of having actual fans. When that happens, no one is better off – actually, it’s one of the reasons that marketing professionals are in the trouble they are in.
I guess it’s human nature to look for the shortcut – the easier route. Look getting people to click a button to become a “fan” is relatively easy – it’s a lot harder to build a true fan base; a community of people who are connected to what you do and care – passionately – about what you and your company are. It might look better to have thousands of people signed up to be your “fan” – but I’ll take the few that really, truly care.
Selling Mistakes In A Recession
Last week, I was sent a query from a reporter doing a story on the mistakes salespeople make during a recession and how selling is different in a recession. As I wrote my answers to her questions (and knowing that at best an excerpt would be used), I though I’d share my full answers. I hope they help as you guide your sales efforts. Questions are in italics.
1. As a sales manager/trainer, what is the most important lesson you have learned when coaching salespeople through past economic downturns?
The most important thing I’ve learned in guiding salespeople in any environment, but especially in a downturn, is to maintain concentration and confidence. It’s very easy to get focused on what is being “lost,” which erodes confidence and causes salespeople to enter a scarcity mentality. Getting salespeople to focus on what is happening and on the opportunities that do exist is critical. When salespeople focus on what is happening instead of what isn’t happening, they’re able to take an assertive approach and build their confidence. When they’re not focused, they become increasingly reactive, and in a down economy, being reactive is the equivalent of being thrown by the waves in a hurricane.
2. Is selling during a recession different from selling at any other time? Why or why not?
Selling is and isn’t different in a recession. The difference lies in the customer’s mentality. The customer is more likely to be in a defensive posture and to shut down. This means that salespeople need to focus even more on connecting with customer issues and diagnosing the causes of problems, they must make their offerings indispensable. Additionally, salespeople must spend more time ensuring that the customer a) fully understand their problem and b) that salespeople monetize the value of their offerings/solutions. If a selling proposition fails to provide hard evidence of return, the “softness” of the proposition will be overwhelmed by the fear of risk from the buyer and the sale will stall. What’s not different about this, is that this is what salespeople should be doing in any market. They’re able to get away without doing this work when “the tide is high,” but in this environment mistakes are not forgiven.
3. What is the most detrimental mistake salespeople make in a down economy?
The biggest mistake they make is they lose focus. The natural tendency in a down market is to try to put more and more opportunities into your “pipeline” or opportunity filter. This is what I call the wide approach. However, because customers are in a heightened state of fear and the work a salesperson must do to make a sale is greater going “wide” is deadly. We call this going wide instead of going deep. The right strategy in a difficult market (any market really) is to go deep – but few salespeople (or businesses) actually do this.
4.Why is this mistake often made?
The reason for this mistake is twofold:
- Fear – salespeople start getting worried, take on a scarcity mentality and start focusing on volume of “opportunities” rather than the depth or quality of them.
- Lack of strategy – the reality for most salespeople is that they are less “the cause of sales” in good times, than they just happened to be there when sales got made (I don’t mean this a derogatorily). When times get tougher and buyers retreat, salespeople have not developed the skills or planning to truly penetrate and create opportunities. I often say that the definition of a great salesperson is someone who can be selling when there is nothing that can be bought. This is how relationships are built and developed.
5. What can be done to correct this mistake?
The solution:
- Training – the unfortunate truth is that most salespeople need to be taught again how to sell. They’ve operated in a “rising tide” environment for so long that they’ve become lazy and stopped competing. Selling in difficult markets is different than in growing or neutral markets. Every industry has the feel of “decline” to it. New skills and new approaches are needed.
- Focus – The three most important aspects of selling in a difficult market are: focus, focus and focus. We are advocates of what we call Warboards – lists of key targets that we are pursuing. This idea is by no means new or original – frankly all great selling organization utilize a similar approach. Our prototype recommendation is on what we call The Focus 50 (this number is adjusted depending on company issues), which is comprised of The Top 20 (the 20 best opportunities that we are working with to close in the short term) and The Farm 30 (the 30 best opportunities that we are developing). 80-100% of sales efforts should be focused on Warboard accounts.
- Monitoring – One of the first things President Barack Obama did when taking office was to institute a daily economic briefing to mirror the daily national security briefing that Presidents have been getting for decades. The same thing should be done in selling organizations. On a daily or weekly basis (depending on the situation) there should be a Warboard Review meeting. Every Warboard account is reviewed in a rapid fire manner. This increases accountability, requires salespeople to maintain focus on accounts, and identifies opportunities and, more importantly, log jams faster. We find that within a month of instituting the Warboard Review meeting the entire sales culture changes for the better.
Is It A Relationship or an Acquaintance-ship?
I was talking with a client and friend of mine about the challenges facing salespeople today. We were discussing the need for salespeople to take a more focused approach that went deep with a prospect, rather than the far more frequent approach that focuses on volume and activity over depth.
As we were discussing salespeople who went deep vs. those that did not, I made the observation, “It’s interesting, because Person A (who doesn’t go deep) is considered a relationship salesperson, while Person B (who goes deep and produces more with fewer opportunities) is considered a task-oriented salesperson and is not thought of as a relationship salesperson. Yet, Person B is the one who really builds meaningful, compelling relationships.”
As I thought about the issue more (and followers of this blog know that I’ve written about relationship selling before), I realized that what most people call relationship selling is really, what I am now calling, “acquaintance-ship” selling. These salespeople, while they potentially have “big rolodexes” don’t really have meaningful, compelling relationships.
Acquaintance-ship salespeople focus on stuffing more and more opportunities into the pipeline, figuring that if they can be “actively working” 100 or 200 opportunities (and in some cases even more), then certainly something will come through. In good markets, acquaintance-ship selling can even look like it produces consistent results. The reality is far from that, however.
The problem is that acquaintance-ship selling relies on the law of large numbers. While, in the short-term and in good markets, it produces what looks like results, the reality is that the salesperson is not really selling – they’re merely picking up sales that were going to happen anyway. They create very little value and they commoditize the offering and the organization.
You know your sales team is practicing acquaintance-ship selling when the following are true:
- The focus is on quantity of activity rather than quality (BTW, it is rare that one can practice any more than acquaintance-ship selling if there are more than 20 late pipeline prospects and 50 total).
- You see “false positives” in the sales process.
- When querying your salesperson on what is happening in an account or prospect, the salesperson does not clearly articulate the compelling reason for a buy, nor the compelling barriers that must be overcome.
Acquaintance-ship selling is very costly to any growth organization. It makes the pipeline highly vulnerable to competition and/or market shifts, it eats up more and more resources in an effort to “keep the balls in the air” and it fails to create compelling value – further commoditizing your company and making it more difficult to succeed.
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Resources
Doug's Washington Business Journal Columns- Intelligent Growth Articles
Third Wave Selling Blog
Products to Grow
