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Uncovering The Real Power of Brand
As I’ve written before, “Brand” and “Branding” are words tossed around in a variety of ways. For small and mid-market companies, the vast majority of what’s thrown around about branding is crap.
I’d like to highlight the portion that isn’t. To begin that journey, I ask: Do you really understand what your brand is, and the power behind it?
I’m always looking for new ways to help owners and executives of growing SME’s understand that, and recently I came across a branding study designed to guage the power of a brand. I’m a big fan of Marty Neumeier, and since his firm was behind the study, I looked at it closely.
The Brand Impact Study highlights four important attributes to determine a brands power. These four attributes are valuable for any executive looking to expand sales, margins or both. They are:
Awareness
- Do the right people know who you are?
- Do they have a positive, meaningful impression of your business?
Consideration
- Do they consider your business relevant?
- Do your prospects position you as a problem solver, or merely a solutions provider?
- Do they view you as someone to engage with while they’re figuring things out, or after they’re ready to issue an RFP?
Preference
- Does your target audience understand your value proposition?
- Do they acknowledge, understand and value the difference your bring to the market?
Purchase Intent
- Do your prospects understand your impact ?
- Do they understand, and can they articulate the consequence/cost of not doing business with you?
Strength in these four areas – with the right prospects/customers – is the definition of a powerful brand (even if most people don’t know who you are). Keeping these four components at the top of your mind when developing your marketing and brand strategy will go a long way to accelerating your growth and protecting your margins.
Insurance Companies Prove Problem With Most Marketing Approaches
The comedic approach taken by a number of insurance companies is not working, according to USA Today. While I admit that I find the Farmer’s Insurance commercial entertaining, it hasn’t even tempted me to think about buying anything from them.
As I’ve written many times before, being different should never be the focus. Today, it’s not even enough to be different and better; instead, you must be different, better and relevant. The problem with most traditional marketing approaches is they do nothing to make companies, products or services relevant.
The article highlights the changes Nationwide Insurance, among others, is making to their advertising campaigns.
“While the World’s Greatest Spokesperson helped boost brand awareness for the first time in over a decade, the two-year campaign couldn’t stem eroding market share — off 9% since 2009 — even as Nationwide was pouring more and more money into advertising. Last year alone, Nationwide hiked annual ad spending more than 35% to more than $200 million.”
How do you like that?! Increase ad spending by more than $70 million dollars and lose 9% of your market share. Where is Sergio Zyman when you need him?
If this isn’t proof that awareness means nothing, I don’t know does.
Growing your business today require more than awareness; it requires engagement. It requires bridging the chasm between your marketing and sales efforts and building a system that focuses on creating meaningful conversation, rather than just making claims.
The failure to radically change this approach will continue to cost businesses – large and small – millions in lost sales, profits and equity value.
The Challenge of Different & Good
I love simple graphics that tell big stories. As I was reviewing some of my article archives, I came across this graphic from Marty Neumeier on The Dynamics of Different and Good. It’s about as simple and insightful as you can get.
I often remind small and mid-market business executives that being different should never be the goal, instead, it’s different and better. Yet, as this graphic explains, achieving the goal is the beginning of the journey – it’s not the end! When you achieve “difference” going to market becomes difficult. The market resists because it’s not used to it, and as a result your sales and marketing strategy must educate and influence your market. (For a deeper dive into this subject, watch my 25 minute video on the subject.)
What equally interesting and critical is the failure to achieve this goal results in the appearance of an easier path to the market. The market (and those whose opinions you seek before going to the market) respond more positively to what they’re familiar with. The challenge is that there’s little to no growth on that path, and lots of price pressure.
Market resistance is a part of the game. Don’t avoid it, embrace it.
Selling Done Right
What profession is best suited for a liar?
How do you know when a salesperson is lying?
It’s unfortunate that salespeople have become the butt of so many jokes. In the past I’ve written about pests, peddlers and Demand Creators, and shared the advantages to being a Demand Creator.
As the world continues to move forward from the deep recession, there are still not enough companies that are building the organizational capability necessary to consistently grow profits. Selling, on the whole, is not creating the value necessary to support higher margins and faster profit growth for small and mid-market companies.
Ineffective sales efforts are actually contributing to:
- Greater commoditization
- Lengthening sales cycles
- Greater price pressure
As I’ll be sharing next week in our free webinar on The 7 Steps to Shortening The Sales Cycle, businesses need to create a new path and implement new approaches to sales. Now, more than ever, it takes an organization to sell effectively, not just a salesperson.
Done right, your sales effort is the most powerful, leverageable resource to accelerate revenue and profit growth, and to increase the value of your business. Building the capability enhances your brand, allows you to bypass competition and serves as a virtually insurmountable competitive advantage.
Selling properly requires that you stop focusing on making a sale. Instead, you need to focus on being relevant, helping your customers achieve their objectives and teaching your prospects how to improve their worlds.
It means slowing things down a bit, (really) putting customer’s interests first and understanding that sales, profits and business value are the result of a proper focus, and cannot be the focus.
When you realize that the job of sales is to help, and you build the system to make that happen, suddenly the sales process becomes easy.
A Crucial Decision to Drive Your Profit Formula
I often talk about how salespeople and companies can Move Beyond Price to put the focus on what your products/services are worth instead of what they will cost. As part of the process, I explain that price is really a signal, telling both buyer and seller how the other values of the proposition being put forth.
The implications of The Drought we find ourselves in as we continue to emerge from the deep recession puts more pressure on sellers to justify their prices and margins. Sellers must be able to answer a very simple, clear question: Why should a buying organization give your products/services a favored status, allowing you to earn higher prices and margins?
Increasingly sellers are failing to have compelling answers to this question. In my experience, the underlying reason for this is because sellers are either unwilling to put forth the effort to offer propositions that are truly different and better than others, or sellers are merely afraid to make a compelling promise.
Companies have a crucial decision they must make:
- Do they want to focus their profit formula on enhancing and growing margin? or
- Do they want to focus their profit formula on growing volume faster than anyone else?
Companies that choose the former must go further and ensure that their value proposition connects more deeply with their customer’s businesses. They must find and/or enhance their ability to make their customers more efficient and effective.
Companies that choose the latter must aggressively eliminate costs within their organizations so they can continue to deliver their products and services faster, cheaper and better than their competition.
Either road is difficult, but today, more than ever, you must make a choice. Straddling these two approaches is simply becoming too precarious and risky to sustain.
To get you started, here are two articles I just read that show how other companies are meeting this challenge.
- USAToday shares insights into how FedEx and UPS are deepening the value proposition and building adjacent business to drive their growth.
- In the recent filing for Facebook’s public offering, founder Mark Zuckerburg shares the Facebook philosophy with what he calls The Hacker’s Way. Every entrepreneur should read this (regardless of how you feel about Facebook or Zuckerburg). My favorite quote in the piece: We don’t build services to make money; we make money to build better services.
What choice are you going to make?
The Key to Differentiation: Be Bold, Be Different
Sunday, while watching The Washington Redskins (finally) win, I saw an interesting ad from Chevy. I have to admit that it tugged at my heartstrings a bit.
It told the story of a family who tracked down their father/grandfathers original 1965 Chevy Impala SS. The emotional message was, “More than a car…a Chevy.”
I’m not sure how effective the ad will be in selling more cars, but I certainly hope its effective with the management and senior leadership of GM, and other companies. See, the thing that created an emotional bond between Dad and his Impala, is that, like it or not, the Impala was not a boring car. The Impala had character.
GM’s problem today (and for most of the last 20+ years) is that their cars are boring, me-too vehicles. With the possible exception of the Corvette (which has stayed strong), there’s nothing interesting about a Chevy. With all due respect, what the heck is a Chevy Malibu? Don’t get me wrong, the Malibu is not a bad car (I drove one recently when traveling), there’s just nothing special about it. It’s like every other car I’ve driven.
If GM, or you, want to be more than just your product or service – a worthy goal – then take a risk. Stop differentiating and do something different. It’s not a guarantee for success, but I promise its a great first step.
Another Word For Solution
Do you want to know another word for solution? It’s commodity. That’s right, any time your focusing on a solution, your solution, you are focusing on a commodity.
Let me share some examples:
- ABC company develops unique solutions. Really, it’s ABC company develops unique commodities.
- ABC’s dynamic solutions enable companies to create advantages. Really, it’s ABC’s dynamic commodities…
Think about that. How can a commodity be unique? How can it be dynamic? It can’t!
A commodity is anything with a perceived alternative – and every solution has an alternative.
Last year I shared some important insights into pricing and how to increase the desire people have to pay you more. I talked about the importance of focusing on the right-side of the value equation, not the left.
Solutions are at the core of “left-side value.” Results are the core of the right.
When you focus on the real results companies desire, you’re having a “what’s it worth conversation.” When you spend your time exalting the superiority of your solution, you are merely commoditizing yourself.
So, get out of your own way. Forget about you and focus on the customer. Understand them, and what it is they really want. What are their end results? Tie them back to your approach, and the solution takes care of itself.
Stop Differentiating – Start Enchanting
This book review originally appeared in Baltimore, Washington and Philadelphia SmartCEO Magazine May issue.
Two of my absolutely least favorite marketing terms are: differentiate and brand. The reason I hate these words is because they are both results that a whole bunch of marketing agencies and advisory firms turned into means so they could both make the process insanely complicated and therefore charge ridiculous fees for it.
My distaste for these words is far more than merely semantics. My problem is that when companies focus on differentiation and/or branding, in the traditional sense, they are focusing on the wrong things. Both words cause you to focus either internally or on your competition; neither of which are effective for driving profitable growth in today’s hyper-competitive times.
Why Differentiation Is Not Enough
I regularly advise CEOs to stop differentiating, and instead just be different. In working with thousands of small and mid-market companies (and studying thousands more companies) I’ve observed that the only companies that spend significant time on differentiation strategies are the ones that aren’t different.
Think about it. If your business is different, how difficult should it be for someone to realize that? How hard should you have to work to “differentiate”? Companies that are different are differentiated, those that aren’t – are not.
In my experience, I’ve seen what happens when differentiation becomes the focus of company executives. They stop focusing on the critical questions about their customers and what really matters to them.
Instead their center of focus becomes the competition. They start asking, “Is this our unique selling proposition,” rather than, “What would absolutely delight the people with whom we want to do business?”
Without meaning to, they commit the very sin they were trying to avoid – they start feeling and acting just like every other company. They quickly become what I call a “Me-Too” company.
The Problem With Branding
Don’t get me started on branding (okay, too late). The biggest myth in marketing is the idea that businesses can brand themselves or control their brand – they can’t! Business don’t control their brands, their customers do!
The problem with branding is very similar to the problem I have with differentiation – the questions branding leads executives to answering are bad questions.
Branding isn’t something companies do to their customers; it’s something customers do to businesses. It’s not about telling your story; it’s about having our stories understood.
Branding isn’t about logo’s, brochures, ad slicks, and any of the other trivial things that businesses do in an effort to “re-brand.” Rather, it’s about ensuring that that what your business is, is what it is supposed to be. It’s about delighting your customers and creating meaningful experiences for everyone that comes in contact with you. Far more than merely being liked, branding is about being valued.
If Not Differentiating or Branding, Then What?
For the last five years I’ve been sharing my discovery about the fundamental difference between great companies and non-great companies. I’ve learned that great companies have mastered five simple rules that others have either ignored or failed to master. I call these The Five Unbreakable Rules for Creating Demand.
Summarized these rules state that the key to creating a great company (and anyone can do this) is to focus – manically – on who your customer is and how can you delight them.
It’s as simple as this:
- Great companies know who their
customer is – and who they are not. They never confuse the two. - When you are delighting your customers, you don’t have to worry about differentiating anything – your customers will take care of that for you.
There is probably no greater example of how to do this than Apple. In the 3 Acts of Apple they have delighted a core group of customers so deeply that they achieved a cult-like status, they’ve failed to delight customers and nearly went bankrupt, and in Act 3 they returned to delighting customers and are the single best performing company in the last 15 years.
While I try not to review the most popular books in the business space in this column and instead try to highlight authors and books that readers of SmartCEO may not be as familiar with, I’ve decided to make an exception.
Guy Kawasaki was there for Apple’s first act, heck, he was Apple’s Chief Evangelist. Since he left Apple he’s been delighting a core group of customers. He newest book Enchantment: The Art of Changing Hearts, Minds and Actions is an absolute must read for anybody in business.
From their first sentences in Chapter 1, “The world will not beat a path to your door for an insanely great mousetrap. In fact, the greater the mousetrap, the more difficult it is to get people to embrace it …” Kawasaki enchants readers with simple how-to’s to stand out, resonate and build great businesses.
So stop differentiating and start enchanting.
Branding Is Crap!
There, I finally said it. Branding is crap! Sure, it might be fine, even important, if you’re Coca-Cola, Starbucks, Proctor and Gamble, etc. While I’m at it, the whole idea of Top of Mind Awareness (TOPA) is crap too! Maybe if your competing for the 2 second purchase decision of what laundry detergent you’re going to use then all that stuff matters. But – and this is a big but – if you’re a small or mid-market company selling products or services to other businesses (large or small) stop worrying about your (Capital B) Brand or top of mind – trust me, your customers and prospects have far, far more important things on their minds than thinking about your company.
A great brand is a result of being relevant, important and delighting people. It’s not a logo, an icon or an exercise. As I’ve said hundreds of times – your brand is what others say you are, not what you say.
I’m writing this post because it’s making me sick seeing how much money small and mid-market B2B/B2G companies are spending on useless “branding” exercises.
I’m working with a potential client who currently has 20 clients that his company works with. Success for him is adding 2 – 4 solid clients/year. He just spent more than $20,000 to “assess the market and his brand.” Here’s the problem – HE DOESN’T HAVE A “BRAND”! And that’s okay.
He’d be far better off taking the $20,000 and investing it in building an effective marketing asset; and so would every other B2B company.
The problem I have with branding is that it puts the focus in the wrong place – twice.
- First, it places the focus internally on you, rather than your customer. Great companies look outside, not inside.
- Second, and worse, it looks at the world as it is, rather than as it could be. As a marketer, I’m not particularly interested in what customers think today. I’m interested what you want them to think, and the actions you can take to increase the probability that they’ll think that. And you can’t ask customers what they want – as Steve Jobs says, “It’s impossible to ask people what they want, when what they want is around the corner.”
It’s your job to figure out what they want – and then to focus maniacally on making that happen. If you do that, you won’t have to worry about your brand – you’ll have too many people wanting to work with you to have the time.
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.
Build It…They Will Come
The 1989 movie Field of Dreams is, in fact, the daydream of every marketer. The line made famous in the movie, “If you build it, he will come,” embodies the desire of every marketing organization since the beginning of time.
Of course, marketing has never been that easy. John Wannamaker, a famous retailer, said, “I know I’m wasting 50% of my marketing budget, my problem is that I don’t know which 50%.” My own experience indicates that not only are most companies wasting 50% of their budgets, but also the 50% that is not wasted is only getting about ½ of the results it should be.
The fact of the matter is that marketing – traditional marketing, at least – is broken. Just like traditional selling, it is built on an ineffective, highly inefficient foundation. This means that improving your marketing efforts isn’t going to do you any good. Quite the contrary, merely throwing more to this inefficient system is going to further thrust your company into the black hole of The Commoditization Trap.
There are two critical flaws with traditional marketing:
- It is a broadcasting mechanism, and
- It only communicates value and typically fails to create any.
Broadcasting
It’s trite and it’s true. When there were only three channels and virtually no other way to communicate, broadcasting worked. Today, broadcasting is highly ineffective.
Picture yourself in Times Square in New York City. How difficult would it be to get the attention of people there? How loud would you have to yell? It would be virtually impossible (before you protest, the Naked Cowboy is the exception that proves my point).
You need to understand that today we all compete in Times Square. Here are some scary statistics for you:
- The typical person is exposed to 3,000 commercial messages a day, yet the human brain is incapable of processing more than 100 per day.
- In the last 5 years, the number of pages indexed by Google has expanded by more 360 times.
- In 1986, America had more high schools than shopping centers. Today shopping centers outnumber high schools by two to one. Plus the stores are three times denser than in 1986 – and that doesn’t even account for “online shopping centers.”
This means that there are a lot of people shouting and if all you’re doing is broadcasting (shouting) with a static website, advertising, direct mail or whatever, the likelihood of getting through and driving real results is highly unlikely. Whatever results you do create will be swept away by the costs of getting and maintaining your presence.
Value Communication
Before the age of the Internet, people relied on traditional advertising and marketing as a means to know what was going on, what was available and how much stuff cost. Today, people are building bigger barricades to keep advertisers and broadcasters out.
With all of the noise in the world today, the only effective approach to marketing now is to earn people’s attention. And, in case you didn’t know this, your customers and prospects don’t really care about you, your products, or even your goings on.
What they care about is themselves. They care about their lives and they’re constantly looking for ways to make it better. Contribute to that – before they have to buy from you or even give you their name – and they’ll give you their attention.
The Good News
The marketing tools available to businesses today make it relatively easy to overcome the barriers of traditional marketing and to transform your broadcasting approach into a finely tuned, pull marketing system. Today, if you follow the new rules: if you build it – they will come.
Even better, where traditional marketing approaches favored large, high capitalized business, today size is at worst a neutral factor; and in my experience the new world of marketing plays to the strengths of small and mid-market companies willing to work at it.
There are three simple rules you must follow:
- Create value by providing useful information and knowledge that will help your customers and prospects.
- Give it away and give up control. That’s right – give it away. Don’t ask for money, don’t ask for commitment, and don’t even ask for an email address. First give, then over time you will receive.
- Consistently engage. This is not an overnight success strategy; you must “be there.”
If you follow these three simple rules, you’ll be able to build an enormously valuable marketing asset and you’ll be able to eliminate marketing expenses.
Is BlackBerry A Dead Product Walking?
There are 2 types of companies in the world today. You are either:
- The best, or
- You’re a “Me-too” company
Only “best” companies will earn margin premiums and enjoy the growth worthy of the hard work of business executives and salespeople.
I’m becoming increasingly convinced that BlackBerry is rapidly falling into the “Me-too” category, and will become increasingly irrelevant (and less profitable) going forward.
Full Disclosure: I’m an Apple fanatic (of course, if you’re reading this blog, you probably already know that). I’ve owned every version of the iPhone within a week of its release. So maybe that colors my thoughts, but I don’t think so.
One of the fundamental precepts of great businesses is to narrow your market focus and expand your yield. Great companies are maniacally focused on who their customers are – and who they aren’t. Jim Collins made that clear in his seminal book Good to Great.
BlackBerry, at one time, was an absolute killer device. I had one and loved it. Ever since the iPhone came out, and the smart phone category exploded, BlackBerry has been struggling with finding its place. The Storm was a disaster (on all counts), and they continue to lose market share.
To fight that, they keep “innovating” and coming out with new products. A recent view of their website highlights seven different models to chose from. So I ask, what is a BlackBerry?
In contrast, Apple offers one model (two if you consider the fact that they are still selling the 3GS), and no one need ask the question, “What is an iPhone?”
Watching BlackBerry’s approach reminds me of the 1991 movie, Other People’s Money. In it, Danny DeVito played the memorable character Larry the Liquidator. In trying to takeover a dying company, he said:
We’re dead alright. We’re just not broke. And you know the surest way to go broke? Keep getting an increasing share of a shrinking market. Down the tubes. Slow but sure.
Here’s my corollary:
You know the surest way to go broke? Keep introducing more new products while you continue to lose share of a growing market. Down the tubes. Slow but sure.
Think about this for a moment. Who loves – I mean really loves – their BlackBerry?
Heavy duty email users – that’s who.
Email was the entire basis of BlackBerry’s success to begin with. They invented technology and a device that solved a critical problem for people.
Now, what’s their newest device? The BlackBerry Style. Huh?! What?! If someone is buying a phone for “style;” guess what – they’re buying an iPhone.
People who buy BlackBerrys buy them for function. BlackBerry is superior to the iPhone if email is critical. The iPhone is superior in just about every other way.
What Should BlackBerry Do?
To ensure its future, BlackBerry needs to stop playing other people’s games. They need to focus on their core market – heavy duty email users.
Is that a smaller market than the size of their current business today? Yup. But guess what, BlackBerry isn’t as big as it thinks it is.
BlackBerry needs to answer the same question that small and mid-market companies are faced with every day:
Do I keep fighting for volume and size which will result in less profit and greater vulnerability, or do I accept the market for what it is and focus on what we do best and become relevant?
What would you decide?
Product vs. Service Sale: A Crucial Distinction
For as long as I’ve been in sales, guru’s have always focused on the differences between selling products and selling services. The approach, skills and talents required to successfully sell products are quite different from those needed to successfully sell services.
A major trend I’ve noticed over the last 5 – 10 years is that the distinction between “products businesses” and “services businesses” has become increasingly blurred; as product oriented companies have added services, and services companies have “productized” their offerings.
While the distinctions between companies has grown more nuanced, it’s impact in the selling process hasn’t. It’s critical that you decide if you are selling a product or a service. This simple statement of need can best illustrate the difference between a product and service sale:
Which word do you focus on – “it” or “now?”
If you focus on “it” over “now” you are making a product sale. You’ll focus your sales process, marketing and positioning on the product being offered. You’ll gear your sales efforts to late stage buy-cycle opportunities. Because your focus is on the product, you’ll deal with commoditization on a regular basis (you may even be the chief commoditizer), and as a result your margins will be tighter; hence, you’ll focus more on volume.
If you focus on “now” over “it”, you are making a services sale. You’ll focus your sales process, marketing, and positioning on the consequences of not getting it now. You’ll spend more time educating your customer base on the barriers to “now” and the impact that “now” has on their organization. Your efforts will focus on radical differentiation, and while your volume may be lower (everyone that needs “it” doesn’t need it “now”), you’re margins will be much higher.
A perfect example of the two can be seen between the two most profitable companies in the technology space:
- Microsoft focuses on “it,”
- Apple focuses on “now.” (Realizing that “now” is a metaphor.)
The Big Mistake
Everyday I see companies, especially small and mid-market ones, make a critical mistake. They try to focus on both “it” and “now.” At the risk of over-simplifying the issue, let me be clear:
You must focus on either “it” or “now;” you cannot focus on both.
For those that have been reading this blog for a while, you realize that the product sale focuses on “left-side value,” while the service sale needs to focus on “right-side value.” When you try to focus on both you fall in the middle, and there is no room in the middle.
The middle is Death Valley. You face the on-going margin pressure like a products company with the increased complexity and costs associated with services businesses.
When you’ve chosen which sale you will focus on, your job is to ensure that everything you do – the questions you ask, the ads you run, the social media strategy you implement, etc. – is completely aligned behind the decision.
I am not saying that the product or the service sale is either good or bad. My point here is that they are different. If you want to accelerate your profitable growth in the future you need to chose one – and only one.
Revisiting: What Do You Sell?
In April, I discussed the need to shift from selling “stuff” to selling results. Making that shift requires a change in mindset far more than merely talking about what you do differently. In your mind and actions, you must change the focus of what you sell.
For example, at Imagine, our promise is:
- More sales
- Faster sales
- More profit per sale
One of the things we do to help companies achieve this is 1:1 sales coaching of their salespeople.
If we start our conversations about their salespeople or their coaching/training programs, then we are selling on the left side and will be commoditized. Even if we’re asking questions and learning what they like or don’t like, we are in the “we-do” trap and our sales process will get bogged down.
This is true even if the customer/prospect calls up in search of sales training/coaching (or whatever it is that relates to what you sell). As a matter of fact, this is one of the most common – and costly – sales traps out there. The customer sounds like they’re looking for exactly what you provide, using the exact words you use to describe it. Figuring you’ve got a “lay-up”, you explain your stuff and before you know it the customer is lost or pressuring you on price.
From the very first moment you engage with a customer, you’ve got to make a critical decision: are you going to focus on the stuff or on the result? If you’re going to focus on the result, which is critical if you want to be selling on the right side, then you must not engage at the tactical level until the result has been clearly defined, as well as (at least) the initial barriers to achieving that result are identified.
When I get a call from someone who wants to talk with me about doing sales training, my response is always – “What do you want to do sales training for?” When they respond, “To increase sales,” I follow up by asking them to explain what is preventing them from making the sales they desire.
That opens up a line of questioning and conversation that allows me to radically differentiate our programs and create the value necessary to make profitable sales.
Growing in a Recovery
After three of the toughest years in the lives of growth-oriented CEOs, the signs are finally pointing towards sustained growth opportunities. While most of the headlines are still very negative, the underlying fundamentals show new opportunities for companies ready to make the transition.
While our research clearly indicates that we are out of “The Great Recession” that has provided the narrative for the last three years, this recovery will not be anything like the “recoveries” of the last 20 years.
We’ve summarized the key ingredients for succeeding in a recovery to five points, or The 5 P’s to Ensure Success in a Recovery. Now is the time to give yourself a check-up in each area, and ensure that you are prepared to create a newer, bigger future.
The Five “P” Checklist:
- People
- Process
- Proposition
- Profit Formula
- Posture
If you want to learn more about The FIve P’s, here are three options:
- For a quick summary, check out the latest issue of The Demand Creator Newsletter.
- On November 9, 2010 at 2pm EST, we will be hosting a special webinar on The 5 P’s to Ensure Success in a Recovery. We’ll have more details about the webinar out early next week.
- If you can’t make the webinar, you can order our soon to be released report – The 5 P’s to Ensure Success in the Recovery.
Of course, you are always welcome to pick up the phone to ask one of our experts any question or send us an email.
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Resources
Doug's Washington Business Journal Columns- Intelligent Growth Articles
Third Wave Selling Blog
Products to Grow
