The Sales Café

By Elisabeth Watson

“Your hold time will be approximately 87 minutes.”

Who likes to hear that? Certainly not your customers.

We spend so much time (or we should) on training customer service people or sales reps or both. We study our potential customers’ responses to every possible method of engaging with them. We tweet, we follow, we friend, we call, we don’t call, we do whatever we think is possible to convert a prospect to a customer.

And then we put them on hold.  Or process their return in 4-6 weeks. Or refer their questions to someone who has no understanding of the product or how they use it.  After the romance of the sales cycle, that is more than a little abrupt.

We’ve done the hard part, convincing someone to buy from us, but then we often drop the ball. Revenues, especially new revenues, are the Holy Grail and it’s easy to forget that the cheapest and the easiest sales come from our existing customers.  And no matter how relevant our collateral or how effective our message, referrals are our most credible sales resource. It’s vital that we make it easy for our customers to pass along those referrals, long after they’ve signed the contract and committed to our products and services.

So how do we ensure that our customers have a great experience throughout the lifecycle?  By applying that old management adage, what gets measured gets done.  We need to evaluate each aspect of the customers’ experience from their perspective and look at how it impacts the customer experience—from that first call through every interaction.  We forget that our cost centers touch the customer, too. As Nigel Blair-Johns, Operations Manager at HP often reminds me, “Paying the bill is part of the customer experience.”  If our invoices are inaccurate or not timely, paying us can cost the customer money, not to mention frustration.

I know, I know, you can’t spend money and time on those cost centers. You need to focus on revenue. This economy is brutal.  I understand.  But.  Yes, but.  You can start with something as simple as your attitude.  Look at each of your processes from your customer’s perspective.  Just for a minute, stop channeling your accountant and consider ALL of your organization’s customer touch points.  Are any of those customer experiences less than great?  If so, that experience is hurting your customer retention, not to mention your brand.

Are you thinking that good service costs more than bad service?  Maybe, maybe not.  A customer-focused invoicing process, supported by reasonable technology, might mean fewer interactions, electronic funds transfers, and improved DSO (Days Sales Outstanding). That translates into lower costs and faster access to cash, which will enable you to return to channeling your accountant.

Reviewing, analyzing, and updating your processes, in the context of your customer experience, could not only improve your top line, but will help your bottom line as well.  What if you cut your fulfillment and invoicing costs by 20%?  What if accounts receivable process made your cash available 3 days sooner?  What if you cut an FTE from your invoice processing staff?  Or redeployed that FTE from problem resolution to reporting or fulfillment?  What if you could cut your accounting error management by 5%? That would be good news, but what’s even better?  Lots of pleasant encounters with—and, maybe even a few referrals from—those people you worked so hard to sell, your customers.

ELA's lead generation survey results are in!  Nearly all respondents are from or with sales organizations where they are responsible for the relationship or partnership with their customers. Everyone expects salespeople to generate new leads, every month.

The best return on time invested included local networking/public speaking and asking for referrals.  Over 80% thought the lead generation approach used was vital or important to developing trust.

Respondent advice on lead generation ideas sorted into four primary buckets.

• 1) Reward lead generation activity as part of overall sales process
• 2) Focus on the Customer in all interactions
• 3) Be professional including making and keeping commitments to prospects
• 4) Always provide value by knowing your product and value proposition

Since relationships are based on trust, then the lead generation approaches like asking for referrals, networking, and public speaking must cultivate trust between the prospect and the sales person.  Let's create a list of tips for each approach that are both effective and build trust.  I will post a short ELA RTG blog entry on each approach over the next few weeks.  You can enhance the approach by adding your comments and ideas. 

Thank you to all who participated.

Outside-In selling -- may the best product win . . . not always!
by Jeff Williams

Second in a Series
As part of the on-going discussion about how an Outside-In sales organization operates, let’s talk for a moment about the importance of the product. 

Many companies -- more than would like to admit it -- believe that customers buy from them because they have the best product in the market.  Well, in some cases (like advanced technology) this philosophy can appear to work for a while, luring the unwitting company down the road of complacency (best case), or the road of arrogance (worst case).  In either situation, the sales successes that are enjoyed early in the game tend to disappear, leaving sales management scratching their heads and asking, “What happened to our lead?”  

The piece that can be easily overlooked during the “we have the best product in the market” exuberance phase is that customers rarely buy based upon who has the best product.  Instead, we find that they are more often looking for a supplier who demonstrates a true understanding of their business and can help them solve underlying business problems.  And, solving complex business problems requires more staying power than simply having the current hot product.  

An Outside-In sales organization builds an understanding of the customer through active listening, and finds ways to strengthen the relationship with the customer over time.  By building trust with the customer, the Outside-In sales team can effectively remove perceived risk in the customer’s purchase decision-making process.  Whether the sale is for something as simple as a single copy machine for the shipping dock, or as complex as a new company-wide accounts payable system, the customer is interested in a lot more than just the initial purchase.  Aspects like long-term reliability, serviceability, and alignment to company values can all play a big role.  Many times the deciding factor comes down to something as simple as how easy it is to “do business” with you.  Rather than the performance attributes or feature set of your product, a mundane thing such as flexible credit terms that fit the customer’s buying process could spell the difference between Deal or No Deal.  

As a case in point: a Fortune 50 computer company I worked for was being consistently beaten by its arch rival in the scientific server market place. Despite having a superior product, customers were beginning to turn to the competitor as a better alternative, and this was causing some consternation for our sales and marketing organization, since we could not fathom why customers were gravitating towards a clearly inferior product. Well, as it turned out, our quoting process had become so bureaucratic that turn around time on new quotes had grown to longer than 14 days. By asking customers what was important in making their purchase decision, our competitor discovered our Achilles heel, and quickly developed a streamlined quoting process that could produce a quote to customers in less than 48 hours. Needless to say, the competition continued to take away market share until we woke up and addressed the real underlying issue. Thus, by steadfastly staying in tune with the unique needs of customers, the Outside-In sales organization – in this case, our competitor – stayed one step ahead of us, even though we had the best product.

I would love to learn about your own experiences with an Outside-In sales organization, so please let me know your thoughts, and what examples you have seen.

At some point in their evolution, all sales organizations go through a thorough analysis of their sales process, with the goal of maximizing the efficiency of pulling customers through their new and finely tuned sales cycle. The prevailing notion is that if we just understood our selling process better – what the steps are, who performs them, the timing of each step, etc. – then we could optimize our selling process, thereby improving our closure rates and overall quota achievement.  Viewing the world in this way – what is best for us – is what I call an Inside-Out approach.

Instead, we should recognize that the only reason that our selling process even exists is because our customers have a buying process that they are trying to get through as efficiently as possible.  Once we make this realization, things can really start to fall into place.  Rather than trying to find all the ways to more efficiently pull our customers through our selling process (Inside-Out), we should focus on how well our selling process aligns to our target customer’s buying process, which is what I call Outside-In.

Let’s take an example of a potential sale near the close of our fiscal quarter (end of January) for $150k worth of forming equipment for a small lamp shade assembly plant.  In the normal Inside-Out (sales cycle) approach, our sales team would naturally be fixated on convincing the prospect how our forming machine is superior to anything on the market, and at a price that beats the competition.  We would focus on moving the customer through the stages of our sales process, including: 1) confirming that they need a new forming machine, 2) verifying that our machine meets all their requirements,  3) checking that the price of our solution fits within their budget, and 4) that we can deliver our solution in a timely manner.  Sounds like we have this deal in the bag, right? 

Wrong. 

If we had been focused Outside-In rather than Inside-Out, we would have put ourselves in the shoes of our customer.  Doing so would have indeed verified all the steps above, but would have also uncovered the fact that any purchase for over $100k requires Board approval, and that the Board only meets four times per year, just after the close of each calendar quarter.  Since that meant the Board held their recent meeting about a week ago, we now have no chance of closing this deal until next quarter!  Bummer . . .

This is Part 1 of a continuing series on Outside-In thinking.  Please let me know what you think – post your own “ah-ha” moments in the comment field – and stay tuned for more to come.  

The subject of demonstrating our product or service always burns in the back of our minds, especially with something as inherently useful as the great solution we sell. A picture is worth a thousand words! We want to show people how their lives will be easier, or more successful. We want to be of service. The question we want to answer today is…..When do you do it? (I’m not going to tell you how, since you already know how.)

I have a recent experience to share with you. I had been working with a business development guy for a while who told me he could bring me qualified leads. We discovered together that nobody in his “Rolodex” owed him any favors, so he tried one last tack with me: “Let’s get everybody to experience a demo of the One Page Business Plan and we’ll generate leads that way.” Well, I like to talk about my stuff as much as the rest of you do, and I don’t do public speaking engagements, so I went along with this as an experiment. In the first quarter of this year, we ended up with about 10 demos to “qualified leads.”

How many systems did we sell, do you think? One - we got lucky! (How many of you are lucky all the time?) Why did they buy? Actually it wasn’t the demo. We knew ahead of time that our client was having difficulty integrating new companies he purchased, and so we tapped into his personal motives.

How many of you are old enough to remember that cars used to last about 2-3 years before you had to trade them in, either because they were junk or because they were so boring that you couldn’t stand them anymore? How many of you still have that occasional itchy Saturday where you go out and kick tires and shop, or in my case pretend to shop for a car? Why do you do this? Do you ever not buy a car when you do this? Do you ever buy a car and why do you buy a car? Did you ever buy a car off of eBay or without driving it first? Did the salesperson—who couldn’t figure out what to ask you—ever suggest that you should go for a test drive? Do you buy then?

Usually not.

You see, when we don’t know what’s driving a customer and we can’t figure out what to ask them to get to their interest, we tap into the lizard-brain part of our inner sales personality and start doing demos. It’s the old, “I have a hammer in my hand, and everything out there looks like a nail.” I would submit to you that doing demos drives away more prospects than it attracts. Why is this? Why wouldn’t your amazing solution just make people start drooling over the prospect of doing business with you? In general, it’s because you’re out of phase with the buyer. Specifically, you haven’t identified what the prospect needs and wants yet and cannot appeal to their task motives, and, more importantly, their personal motives.

Now, today I’m not going to teach you how to sell. If you want to gather up your colleagues and friends, we’ll run the best sales class you’ve ever attended since that’s part of what we do for a living. But, I am going to teach you something really handy that will help you determine when it’s the best time to do a demo.

Take out a piece of paper and draw a line down the middle from top to bottom. Now on each half of the page – that’s left and right half – divide each section with another line drawn from top to bottom. You should have 4 columns? Does anybody have 3?

At the top of the first column, write SHOP. Top of the second, write BUY. Top of the third, write USE. Top of the fourth, write DISPOSE. I’ve been using this tool for years. It comes from Wilson Learning’s Differentiating Business Solutions and originally from Barbara Bund’s Winning and Keeping Industrial Customers.

Customers travel through these four distinct phases in usage: Shop-Buy-Use-Dispose. Each of the phases has distinct characteristics and many steps. The customer determines their behavior either by following a plan or following their nose. The more complex the purchase or corporate bureaucracy, the more steps in each of these phases. It is important to remember to conduct your demos based on where in the cycle the customer is, not where you, the seller, are.

Shop is all the steps a customer takes before selecting a vendor or making a buying decision.

• Seeing what’s out there – Web site search and visit
• Vague notion of a problem – Web site search and visit
• Comparing vendors – Web site visitDo not demo for any of these steps. It is a waste of time. You should focus instead on relating, demonstrating propriety & competence, and overcoming the buyer’s lack of trust. Technology won’t do this for you. More Shop steps include:
• Discovery – do not demo during discovery! Focus on the buyer’s interests, not on solutions. And please don’t use a demo to help a customer self-determine a solution. What little control you have will evaporate in a wisp of smoke.
• Advocating – Now you can demo your product or service as part of showing someone how your solution will solve their problems. At this point, the customer has shown some level of commitment to you as either the person they’re primarily interested in, or the process is down to two people. The solution is not just your product, it’s you and your product!

Buy is all the steps between making that decision and taking delivery. There is little need to demo at this phase.

Use is everything between taking delivery and either using up or completing the usage of the product or service. Here you would use a demo your product or service to expand usage to other people or departments.

Dispose is all the steps a customer takes when they have either used up the product or service or decides it no longer works for them. If you have a licensed or perishable product or service, you might demo to induce repurchase by the customer - but only after you have conducted a thorough discovery!

The lesson here is that all customers or potential customers are in one of these phases at all times. Doing product demos out of phase, for the wrong reason, in the wrong way, and most importantly, in the absence of a defined business problem, leaves everything totally to chance, luck, and probably does little to engender trust between you and the buyer. It will also short circuit the discovery process which, by the way, benefits the customer just as much as it benefits you.

When you demo out of phase, you leave it to your product to create the trust for you and very few products sell themselves. This reduces your close ratio – and as salespeople, we should care about improving our close ratio because it lowers our cost of sales.

On the positive side, and this is what I want to leave you with, understanding how customers buy and where they are in the cycle informs you, among other things, of when and what type of demo to conduct. An early shopper can easily go to your Web site on their own and take a quick trip through, or attend a talk that you’re giving. You can follow that up with an email or phone call while they’re warming up. Remember, they are just shopping; you are just marketing. A late phase shopper can more easily make an informed decision about the solution you’re offering if your demo is on-target with their task and personal motives. Someone who is in the Use phase of another process or product might benefit from a demo of some sort (at a talk or in an email luring them to your site) to see that there might be a better way to do things, and that might send them on a shopping expedition in which you end up pulling the strings. Someone who is disposing of an old process is also generally self-determining how they want to replace it, so a demo would represent an early attempt at getting them to shop with you.

Any thoughts? When do you demo?