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!

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“I’m happy with my current provider.”

Because I’m happy

Clap along if you feel like a room without a roof
Because I’m happy
Clap along if you feel like happiness is the truth
Because I’m happy
Clap along if you know what happiness is to you
Because I’m happy
Clap along if you feel like that’s what you wanna do

—Pharrell Williams

 

Gregory at Medtronic 10-2010 CroppedOf all the sales skill workshops I conduct, by far my favorite is helping salespeople get appointments with prospects and customers over the phone. In addition to giving the learners a number of important guidelines in making effective outbound calls (e.g., never say, “This is Name from Company, how are you today?”), we spend a lot of time helping them through objection handling, the biggest obstacle to the initial goal of getting a conversation started.

One of the toughest objections we all hear is that the prospect is deliriously happy with his current provider. Of course we know this is seldom true. Who on earth is madly in love with his bank for example?  But to hear the prospect tell it, you’d think they were holding hands.

In objection handling, you have to be careful not to sound defensive. In other words, you would never say, “Oh but you don’t know how great our services are!” It’s important to listen and be consultative.  Help the prospect solve his “problem” in the role of a thinking partner.

Do you need your Business Banking sales team to get more appointments?  Do you need your retail bankers to get customers to come into the branch? Do you need your investment sales reps to have more face-to-face appointments? If you’re in health care, do you want your reps to get into that hospital or those doctors’ offices? Of course you do.

So helping them become more effective on the phone is an important priority, and a great deal of their improved effectiveness will come from dealing smoothly with the “I’m happy” objection.  Of course there are other difficult objections which I’ve discussed here before: “Send me something in the mail,” “too difficult to switch,” “too busy to talk to you now,” and a few others.

Off the top of my head I can think of three very strong responses to “I’m happy” that will keep your conversation on track and lead to an appointment. How good are you at doing the same?

Here’s a deal for you.  Send me just one of yours by email and I’ll send you back my three, no charge of course.  Then you’ll have some good techniques to practice and share with your sales team. If this is an important issue for you, write me offline at:  Gregory at actionsystemstraining dot com.

I’d love to help you…

Think Like Your Customer

Fable Friday: How to beat a grandmaster?  Change the rules of chess

1972 was the year that everyone was talking about chess, as the U.S. grandmaster Bobby Fischer unseated the USSR world champion Boris Spassky in Reykjavik, Iceland and claimed the number one title for himself.

Gregory at Medtronic 10-2010 CroppedThe United States Chess Federation was located near my home in NY at the time and soon after the championships were over, our chess club was visited by Bent Larsen, the famous Danish grandmaster who at the time was ranked 4th in the world.  Larsen was staying as a houseguest of the USCF Director and to pass the time he decided to do a local tour of the area and play in a number of simultaneous matches. I was privileged to play against him in one of the early ones.

The story of how he slowly crushed me to death like an anaconda is not very interesting, but I do recall one amusing incident from that match.  A friend of mine, Dave Baker, had just returned from an Army tour of duty in the Far East and he had with him a chess set he had bought there.  The pieces, unlike the traditional Staunton set that is mandatory in all serious matches, were instead replicas of ancient warriors, with the knights looking like Samurais with huge swords, and all the other pieces difficult to identify.

I sat a few chairs away from Dave and watched as Larsen took in the set at his first move. “What are these?” he exclaimed.  Dave showed him each of the pieces as Larsen studied them in their home position.  But once the game began and pieces were all over the board, Larsen became more confused. “What is this piece here?  Is this a bishop?” I should point out that the strategy in a simultaneous for the grandmaster is that he moves very quickly, so he can get around the room faster, thus giving all his opponents less time to think. Dave was driving him crazy.

I wish I could say that Dave’s strategy of changing the rules on the grandmaster by playing with these exotic pieces was entirely effective.  Truth is, Larsen destroyed him. But it did slow the grandmaster down and gave us all a bit of extra time.  That was a fun evening.

The point here is that when you are in sales, and you don’t have a strong competitive advantage, give serious thought to changing the rules of the game.

Let’s say you’re a commercial banker serving the middle market.  The customary ground rules aren’t complex.  Customers will often borrow from institutions that give them the best rate and collateral terms, unless there is a very strong relationship in place. And because banking is a highly regulated industry there isn’t much differentiation in the offers available to you.

So why don’t you just change the rules?  Tell every prospect, “Of course we lend money, but we’re not solely in the lending business.  We offer our customers a sophisticated and technologically superior package of services that help you manage all your cash, from Treasury and Information services to investments, in addition to loans.  This gives you a 360 control position of all your financial needs, and saves you time, money and risk.  Why not let us explore all these areas?” And now you bring other departments from the prospect company into play, build additional relationships and influence the types of offers in the proposal.

And now you have effectively repositioned yourself as a provider of business solutions, rather than a temporary lender of funds.  And when your competitor shows up with his loan proposal, your customer will look at it and ask, “What is this?”

Think Like Your Customer!

Five tips on preparing for the commercial banking sales call

When I was a young commercial banker in the ‘70’s, we often went on joint calls to visit prospects.  One guy would drive and the other would look through the file for the first time and say, “So what are we gonna say to this guy?”  And that was about it for call preparation.

Whenever I tell this story in commercial bank workshops there’s always some nervous laughter because some of them know that’s about all they’re doing today, despite the fact that there is far more pressure on bankers to do a better job of preparing for any call, especially to a strong prospect.

Gregory at Medtronic 10-2010 CroppedYou hear the words, “value proposition,” “resonate”, “differentiate,” “provoke,”, “disturb” and so on, approaches intended to get the prospect’s attention so that you don’t sound just like the other banks’ calling officers.  But how often are you successful at it?  Maybe there’s something lacking in the way you’re preparing for your calls.

Here are five ideas. See if any of them remind you of your own approach, or more importantly if you are a manager, what you see your team doing.

 

  • You don’t put enough time into it.  If you’re calling on a strong company and you’re the new bank, two hours is the absolute minimum to prepare.  The resources are abundant for learning.  You just need to use as many as you can. Before the Internet back in my day, we had those Dun & Bradstreet and other reports that told us almost nothing.
  • You prepare for the wrong things. The primary skill set of most commercial bankers is lending, so they prepare to explore borrowing needs, despite the fact that the majority of businesses don’t use credit. Many lenders forget that banks are in the payments business. Every business has to receive money and disburse it.  They do it every day. Why not explore how you can help with it?
  • You were trained to be a banker, not a salesperson. This means you go into calls prepared to talk about business issues, but not to lead the prospect through self-discovery regarding what he is trying to do, how it’s working and how he feels about it.  And don’t forget that your manager got the job as the sales manager because he or she was a very good commercial banker, so the corporate calling behavior never changes.
  • When you do prepare, you focus on learning all you can about the prospect, instead of the industry and the market the company is in. Focusing only on the company limits your opportunity to discover those tidbits of information that your prospect will find more valuable.  Imagine calling on a company and saying, “Last year 1400 companies in your industry wasted an average of $50,000 because they failed to take advantage of two readily available tax breaks. I’d like to share that information with you today and learn how you are approaching it.”  I’d sit up and listen if I heard that from a banker, wouldn’t you?
  • You won’t call above your “sweet spot.” The bigger the company, the bigger each sale is, but you feel more comfortable calling on the $2 million rather than the $10 million company.  Since your goal in the first call is to conduct needs discovery, you’re going to be asking questions and getting the prospect to talk to you. Don’t worry about your “presentation” just yet. Reach up a notch and get out of your comfort zone.

Call preparation is easier when you…

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…

Think Like Your Customer

Fable Friday: How to make role play work as a training tool

One of my clients negotiates payments between their insurance company customers and the health care providers who send the bills. My client makes its money by taking a cut on what they save the payer.  I help their sales team with calling skills and their telephone negotiators with negotiation skills.

Gregory at Medtronic 10-2010 CroppedIn one of our sales team workshops we discussed a tactical approach to a delicate conversation, and one of the learners raised her hand and said, “Let’s role play it.” Because I seldom hear this from a workshop participant, I was surprised and pleased.  What I have learned over the years is that the more committed and engaged the employees, the more willing they are to do anything they can to improve. Not everybody hates role play.

In my last post here I talked about the down side of role play, when it doesn’t work. But because it is such a powerful learning tool, let’s balance the scales today and share some best practices that will make it more effective.  Here are three ideas to consider in using role play to train your sales team:

Keep them short—Practice short, realistic scenarios.  There is less discomfort, greater concentration and greater likelihood of retention.  For example, at a sales meeting you’re discussing how to open the on-site call. After various ideas have been shared, say to your team, “You are making an on-site call to a good prospect.  After the introductions when everyone is seated, what’s the first thing you should say?  (Name), you go first.”

Provide expert, relevant feedback—Remember that practice doesn’t make perfect. Perfect practice makes perfect.  This means that whoever is giving the feedback should have some expertise. If you’re the sales manager or the training facilitator, it’s usually you. In the scenario for opening the call above, it’s good to have other team members share their best practices when it’s their turn, but make sure the feedback is on target and provides specific help.  Say, “It helped when you asked the prospect to comment on the agenda you sent. It was a useful way to get him engaged right away.” Don’t say, “You asked a couple of good questions.” See the difference?

For this same reason, short fishbowl role plays, in which each learner practices before the entire group, are preferable to learners working in pairs where the partner may not be competent to provide useful feedback.

Use a structured feedback model to build confidence—My preference is to seek comments from the learner first about what went well, and have others comment specifically on the same topic, to reinforce positive behavior. Only then do I allow the learner to talk about an opportunity for improvement, which allows for self-discovery and commitment and keeps the learner from being daunted by the negative data dump of what he didn’t do well.  “You didn’t ask enough open-ended questions and you forgot to mention the promotion…” Unless I nip this early, there is a tendency for the other team members to overload.  Once the learner acknowledges a key area for her own development, you’re pretty much done with the feedback.

Keep in mind that role play, along with simulation, is the most powerful of all experiential learning tools, so don’t abandon it. Just work harder to use it well.

If you have tips, ideas or practices that work well for you, please feel free to share them in your feedback.  My wife keeps telling me I don’t know everything and of course she is right.

Think Like Your Customer