Prime your prospect and sell more effectively

Today we’ll reflect on the fascinating story of the demise of Kodak, the huge Rochester, NY company that filed for Chapter 11 bankruptcy in January 2012.  During its heyday as a growing profitable company, Kodak employed 145,300 worldwide, and in the 1990s it hit a revenue peak of over $16 billion and a market cap of about $30 billion.

Gregory at Medtronic 10-2010 CroppedToday Kodak has a market cap of $351 million and employs 7,300, destroyed by the inexorable move to digital, which was foreseen by everyone except the Kodak executives who blindly believed there would never be a substitute for film. Looking back, it’s easy to see why they could not let go. At its peak, about 70% of the U.S. film market was in Kodak’s hands, and its gross margins were about 70% as well. Kodak was making a ton of money.

The saddest part of Kodak’s story is that it had the key to renewed success right in its hands, as digital photography was originally a Kodak invention.  The digital camera was invented during the mid-1970s by Steve Sasson, a Kodak electrical engineer.

Other companies were able to make profound shifts in strategy based on changing market demands.  IBM, a major early developer of personal computing technology, watched profits drop as personal computers became less expensive, so they shed their PC business and moved into the technology consulting sector. But Kodak’s attachment to film blinded it to the need to make a strategic change.

Kodak’s story is now well known, and I mention it here only as a follow-up to Tuesday’s newsletter in which we looked at solid research experiments in priming, and I promised to help you see how priming can help you sell more effectively.

Let’s suppose you sell technology, insurance, wealth services, treasury services or other financial solutions.  On your next prospect call you might begin with a plain declaration of the reason for your call:

“My most important goal when I call on a prospect or a customer is to ensure they are taking advantage of the latest technologies and advances in their industry, so that they don’t incur a competitive loss by missing out on good opportunities, such as Kodak did when it stuck with film.”

Then go on to recap the story above in your own words. Your intent is to prime the prospect to contemplate the distasteful possibility of loss, a subject which I have written about on this site in the past.  (See this post from June, 2013 on why professional golfers putt more effectively for par than for birdie.)

Remember:  Customers’ fear of loss is about twice as powerful as their desire to gain!

Now your customer will be happy to answer your discovery questions, such as,

“What is it that is most important for you to achieve this year and what gets in the way?”

“How are you using these services now? There may be opportunities to bundle for better pricing, or consider more effective alternatives.”

“What information do you need to have immediately for better decision making?”

“What will happen if you do nothing?”

Now you are in the customer’s wheelhouse discussing subjects that matter to him or her, and as long as your questions are thoughtful and helpful, you have a far better opportunity for constructive dialog.

Selling is easy as long as you remember to…

 

Think Like Your Customer!

Fable Friday:  RIP Jerry Weintraub and how stories help you sell

This week saw the passing of Jerry Weintraub, the great Hollywood writer, producer and agent. I wrote one of my first posts about him in 2011, and I’m repeating it here because it contains a useful sales lesson.

Gregory at Medtronic 10-2010 CroppedOne of my clients is CEO of a software company selling to a niche industry.  But his software wasn’t so robust, and glitches, crashes and lots of service requests left his customer base disgruntled.  Many abandoned him and went with other providers.  He told me, “Now the software works fine.  I’ve corrected the weaknesses, created patches for some defects and provided better central support.  But when my salespeople go to former customers and tell them how we’ve fixed the software and ask them to come back, they won’t budge.  What should I do?”

So I told him a story about Jerry Weintraub, who handled a number of top entertainment clients, Elvis Presley, Bob Dylan, Led Zeppelin, Frank Sinatra and John Denver.  In his book Weintraub told of the time John Denver wanted to fire him:

“He was in Europe on tour. And everything was wrong. He hated everything. He hated the venues. The airplanes were no good. The sound systems were no good. Everything was no good. And he said, ‘Jerry I’m going to fire you; everything is wrong here.’ I said, ‘yeah, I know, I know.’

I said, ‘John, everything is going to be fine because today I fired Ferguson.’ He said, ‘Why did you fire Ferguson? What is firing him going to do?’ I said, ‘He’s been responsible for all the things that you’re troubled by: the hotels, the sound system, the venues, all of it.’ And he said, ‘It’s going to be okay now?’ I said, ‘Yes, I’m putting other people in.  Everything will be great.’

And that evening at dinner I said to him, ‘John, you know, I feel really terrible about firing Ferguson.’ He asked why. I said, ‘Because it’s not like you and it’s not like me.’ And John Denver said to me, ‘I agree with you; it’s not like us. What can we do to help the guy? We’ve got to help him.’ I said, ‘I’ll put him in another area in the company. He’ll be fine. We’ll take good care of him.’ He said, ‘That’s great, I feel so much better.’

Of course, there never was anybody named Ferguson.”

So I asked my client, “Do you see what you should do?”  And of course he did.  He had his salespeople tell the old customers, “That software we sold you had too many problems.  We got rid of it and went with a new supplier. The new software works perfectly now.  We want you to come back with us and we’ll give you a free trial,” and then he started getting his old customers back.

There’s a lesson here, or maybe several of them.  First, powerful stories are a great way to teach. In the training room when I say, “Let me share a story with you,” there is an immediate and positive change in the learners’ body language.  Second, while it’s not right to lie to customers, the ability to position what you say will help influence the way people think.  By packaging all the customers’ problems in one box called “Ferguson” and saying, “That problem is now gone,” both Weintraub and my client were successful in helping people see things in a different and positive way.

The customer simply wants to hear the solution, not about the patches and fixes.  So just tell him, “I fired Ferguson.”  That’s how to…

Think Like Your Customer

Fable Friday:  Positioning Russian cars and other tips

At the height of the Cold War, when the Soviet Union was trying desperately to keep pace with the U.S. while boasting of its own superiority, they issued a challenge to the U.S.:  our Russian-made Zil automobile in a track race against your Ford.

Gregory at Medtronic 10-2010 CroppedWell, it was no contest, and after a few laps the Ford simply cruised away, leaving the inferior Zil far behind.  So what was the Soviet newspaper Pravda to do with this unhappy news? Here’s how they positioned it the next day:

“In a recent track race featuring the Soviet Zil and the American Ford, the Zil finished second, while the American Ford was next to last.”

Had the reader not known it was a two-car race it would be easy to think the Zil had prevailed.

Now I’m not suggesting that you should create disingenuous phrasing like this to delude your customers, but you should give some thought to the way you position the most common questions and statements when speaking with anyone you are trying to influence.

For example, if you are selling a product or a service, you might position the way you explain the price.  If your offer has some high price tag, position how much it costs for a small period of time.  That’s what health clubs and insurance companies do.  Suppose the product costs $300 to $400.  You will see ads that say, “For just a dollar a day, you can enjoy the peace of mind of having this unbelievable coverage…”

And if the investment you are selling has a rather modest return, you calculate the total benefit over a long period of time and position it that way: “After ten years your initial investment of $X will be worth more than $100,000.” And so on.

The same thinking applies when you must ask difficult questions of prospects or customers. You can position these also.  Let’s look at one.

“When are you planning to retire?” you ask, which may cause the customer to feel the question is a bit too intrusive or abrupt.

But here’s an easy model to fix this:

Step One:  What do you want to know?  What is your question?

Step Two:  Ask yourself, “What is the customer-centric reason why I am asking the question?”  Your reason must be one that benefits the customer.  How does he gain by responding?

Step Three:  In statement form, tell your customer the reason you came up with in step two.

Step Four:  Now ask the question.

So let’s work through the question, “When are you planning to retire?” Why would you want to know this?  Well, if you’re selling retirement plans, investment or wealth services, or insurance, you certainly want to know this.  But the key is, “What is the customer-centric reason?”  If you’re thinking like your customer, you know that a big fear is outliving your money.  People worry that if they retire at the wrong time they won’t have enough put away.

So let’s tell the customer this in Step Three:  “My experience has been that most people worry that they may not have enough put away to live comfortably, so my role is to help you make the right decisions now about how much and how often to invest, and of course that solution begins with knowing your planned retirement date, so may I ask when are you planning to retire?”

Positioning is easy if you just…

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Three easy tips to make your clients see you as a winner!

There’s a curious phenomenon in the world of professional sports:  when the team is winning, fans show up in droves, and when the team is losing, no one goes to the games. You’ve seen this happen everywhere.

Gregory at Medtronic 10-2010 CroppedPeople just love winners, don’t they?  They want to be around them, be friends with them and do business with them.  Ask yourself why realtors generally drive an upscale automobile, like a Mercedes or Lexus.  Clients don’t say, “I’m not going to do business with that realtor.  If he drives a fancy car, he’s probably going to charge me a lot of money.”  Instead, they think, “He must be very good at what he does. I want to do business with him.”

So today I’m going to give you three quick tips on how to position yourself as a winner, simply by making subtle but effective changes in your communication skills when dealing with clients. You have choices in the words you use, and every communication with your client affects the client’s perception about whether you are a winner or not.

Here’s a simple scenario.  Let’s suppose you’re a real estate broker and a buyer has put in a very low offer on a home you’ve listed for your client, and your client has counter-offered a small reduction in price.  But the buyer has remained adamant, sticking with his original offer.  Time to call your client with the news. How do you phrase your opening?

  1. Well, I’ve got some bad news.  They didn’t budge.
  2. Let me bring you up to date on my conversation with the buyer. Unfortunately, they’re holding firm on their offer.
  3. I’ve just gotten off the phone with the buyer. They’re holding firm on their offer, which is a bit of a problem, but I have some ideas.
  4. I’ve just gotten off the phone with the buyer, so let me bring you up to date. They’re holding firm on their offer, which gives us some new information. Now let me share some helpful ideas on next steps.

I’m betting that you see how much more powerful it will be if you chose D), so let’s go through the others to see the three tips:

  1. First, never start any conversation with someone you are working for or trying to sell to by positioning “bad news.” There is only “news,” and you have choices on how it’s positioned.  Start off the conversation in a down-mode and you’ll never get out of it.
  2. Get rid of other positioning words such as “unfortunately,” “sad to say,” “sorry to have to tell you,” and other negative first comments. Report facts neutrally, then show solutions.  Keep the client optimistic and confident in you.
  3. The opposite side of a problem is an opportunity. Quick:  name a problem.  Now tell me what is the opportunity that problem just gave you.  Here’s a quick example. Problem:  I’m overweight.  Opportunity:  This will be a great time to start eating a more healthy diet.

 

You can do this every time.

 

A friend of mine told me that at work, someone came out of the copy room and called out, “The printer is out of paper.”  My friend is a winner and he added, “He should have said, ‘The printer is out of paper.  Does anyone know where we keep the printer paper?’”

Remember that you have choices in the words you use.  Give some thought to your own “language inventory” and what you might change today.

 

Think like your customer!

Fingernails on a blackboard:  The worst question you can ask

It often happens that I sit in a training program, sales meeting or similar gathering and the leader sums up the content with this standard question, which I’m sure you’ve used many times yourself:  “Does anybody have any questions?”

Every time I hear this question I jump right out of my skin, and today we’ll talk about why it’s a poor choice and what you must do differently.

Gregory at Medtronic 10-2010 CroppedBut first let’s look at this problem from two points of view, first from the facilitator or manager, and then from the meeting participant. Say you’re the facilitator, and there’s a reason for that word, one who makes the learning easier for the group.  What you want to have in your sessions is learner engagement, dialog, discussion and the certainty that the learners understand, or have skill in the content delivered.

Accordingly, you LOVE questions!  The more the better. When the learners ask questions, they’re telling you they don’t fully understand, lack clarity or need additional information.  All skilled facilitators know this and encourage learners to speak out.

Now suppose you’re the sales manager wrapping up a meeting with an action plan for back-on-the-job performance. Do you want your team to leave the meeting with any uncertainty or misunderstanding about what to do? Of course not.  You’d love for them to ask questions, so you can be sure the whole team is on board and clear about the mission.

So now let’s turn to the meeting participant.  Think of when this has happened to you.  You’ve heard everything, paid careful attention and have the best intentions to perform, but you have just one little uncertainty.  You might ask a question to get some help, but you’re worried about being the first dope to speak up.  You don’t want your colleagues or the leader to think less of you.  I can tell you from experience that no one in a group meeting wants to “look dumb” or be embarrassed. So you half-heartedly put your hand up, then pull it back down.  No questions.

Get the idea?  So promise right now to strike from your canned presentation this horrible closing:  “Does anybody have any questions?”  And instead substitute the more welcoming, “What questions do you have about what’s been covered?

Do you see the difference?  The ineffective question assumes “You ought to understand this and there shouldn’t be any questions.”  The better approach is “I assume there will be questions and I would like to help you with them.”

Remember that skilled, polished communicators are intentional about the way they form sentences and position what they say.  Often their professional approaches are simply small changes in the words chosen, in order to bring about the desired effect.

You want questions?  Then say, “What questions do you have?”  You want the meeting to end and everybody in a fog?  Then say, “Does anybody have any questions?” Get it?

Good.  What questions do you have about what I just covered?

Think Like Your Customer

F. W. Woolworth and how to understand your customer’s real needs

You may know that F. W. Woolworth was the original king of the 5 and 10, or dime store merchandising approach, and that after creating his empire, passed away at the age of 67 in 1919.  But do you know how he died?

Because people nickeled and dimed him to death, that’s how.

Okay, bad joke.

Gregory at Medtronic 10-2010 CroppedBut I wanted to use the phrase “nickel and dime you to death” as an example of a concept that requires your attention when you are selling.  This is a follow-up to my newsletter from earlier this week when I advised you to speak like a gangster, which you can read here to refresh your memory.

Let us say you are talking to a prospect and you ask what is important to him in choosing a provider of your services or products, and the prospect says, “One thing I don’t like is dealing with a company that nickels and dimes me to death,” or he is an existing customer and he accuses you of doing this to him.

Remember the lesson:  this phrase is conceptual, not specific. No one is actually charging the customer a nickel here and dime there. It has a negative connotation of cheapness and greed, always looking to make a little extra profit at the expense of the customer. It’s bad for you when you are accused of it, no doubt.

So once again, make sure you don’t let the comment pass.  You don’t know whether the customer is right or wrong, but his feelings on any subject are reality to him. So by all means slow down and get this phrase out on the table and discussed.

If it’s your customer and he accuses your company of this behavior, make a statement of understanding:  “I’m sorry if you’ve been treated this way…”  or “I’m sorry you are unhappy with any of our fees or charges.”

Then say, “Can we discuss this? I’m interested in knowing which charges were objectionable to you.  Please tell me what happened.”  Then let the customer talk. The idea is to get rid of this negative concept of cheapness and have the customer talk it through, confirm you understand, and then explain or justify any fees or charges the customer may have paid, showing the benefits of the service delivered and the value the customer received.

Here are some other negative phrases you may hear from customers, all of which should tell you “STOP!”  Get the customer to talk them through in behavioral language:

“Your admin gave me the runaround when I called last time!”  Response:  “I’m sorry. Please tell me what happened.’

In negotiations:  “Well, that idea is a non-starter” or “that dog won’t hunt.”  Response:  I’m sorry to hear that. Let’s talk it through and see where your concerns lie.”

“I don’t want to do business with some ‘ivory tower’ company that just dictates what the policy is.”  Response:  “I completely understand. Neither would I. What’s been your experience in the way the company communicates with you?”

“The design you created for our new branch looks tired and old-fashioned.”  Response:  “Thank you for the feedback. Let’s look at it in detail so I can get a sense of your view of old-fashioned.  That way we can focus on the right changes.”

The obstacle for you in sales is that some of these clichés have some negative associations for people, and if left alone will leave the customer with that negative image for you to overcome.  The solution is to get it out on the table and pick it through for specifics.

That’s how you…

Think Like Your Customer

Fable Friday: “Thanks for the Feedback” tips

A friend of mine used to be a wine merchant, or wholesaler, selling to local distributors. He was good at it and made a ton of money.  He told me this story about developing young talent in the sales business.

“I would take a new guy on a call with me and let him handle most of the call.  Soon as we left the customer’s office and had driven out of sight, we’d pull over for some ‘curbside coaching,’ while the call was still fresh in our minds.

These guys were eager to learn because the income opportunities were so great, so I didn’t have to sugar coat anything.  They wanted to know exactly what to do to get better. Giving them feedback was easy.”

Gregory at Medtronic 10-2010 CroppedThere’s a simple rule to remember here:  the more desire the performer has, the more direct you can be with your feedback. Think of Olympic performers, college scholarship athletes and the like.  You don’t require a carefully facilitated conversation.

But this is not the case in most work and personal situations, in which giving and receiving feedback are such critical and delicate skills.

So I’m excited to see that Douglas Stone and Sheila Heen, the Harvard Law school lecturers who gave us the outstanding book, “Difficult Conversations,” a must-read for any negotiator, have come out with “Thanks for the Feedback,” a book directed not at those who give feedback, but on those of us who receive it.

I’m not going to steal or even paraphrase any of their fine work here, as I strongly recommend you read this book. But I do want to add to the discussion with some ideas I’ve written about here in different contexts, one of them being the way in which we handle customer objections.

Initially, it’s good practice to respond to feedback you have been given about your performance in work or in life the same way you should do so when you hear a customer object to your sales presentation.  Here are three useful communication tips:

1)       Pause before you say anything at all.  There are numerous benefits in taking your time before responding.  It shows your counterpart that you are not being defensive, that you are taking the comments seriously, that you are thinking about what to say next, and it allows the speaker to keep talking, all very desirable outcomes. Just count, “A thousand one, a thousand two…” before responding.

2)      Say “Thank you,” just as in the title of the book. No matter if you’re boiling with rage, smile and offer a pleasant thank you, just as if someone has asked, “How are the kids?”  Say, “Thank you for your thoughts. I appreciate your concerns and would like to talk further about these issues.”  Again, this mitigates any negative emotion in the conversation.  These words signal that you are willing to share and solve a problem, not be defensive or argumentative.

3)      Make a transition statement to continue the conversation that does not include these three words:  but, however, or nevertheless.  Imagine I say to you, “You did a great job on that call. I’m really happy with it, but there are a couple of things you could have done better.”  Now quick, what was the power word for you in that feedback? It was the word “but” which tells you I just discounted your good job.  Make sure you don’t use these words to begin your response.

Order this book today, and see how small changes to your conversational style will have a huge impact on how you work with others and how you…

Think Like Your Customer