Sales and Marketing

If there is one common characteristic among sales people it is persistence. People in a revenue-generating role find it difficult to cut and run from an opportunity. In their mind, the prospect or market segment they are trying to develop just needs a little more effort to come around. So they are persistent, sometimes to the point of misspent money and effort.

Even when they realize there is a slim chance of converting their efforts into revenue for their business, persistent sales people leave the now-dead prospective opportunity on the “potential list.” That is when procrastination takes over. Failure to face up to the necessary thinning of the pipeline by some sales people and entrepreneurs ignores reality and prevents focusing on new opportunities. Instead it provides some false comfort to keep them on the list.

But most of this wasted effort can be avoided if we are honest with ourselves and practice the skills of qualification. Qualifying the prospective opportunity requires some probing into the situation and for some this is an uncomfortable activity. But if we approach it on a businesslike basis, it is simply an effort to make sure all parties involved are spending their time productively.

Qualifying the opportunity means determining that the people involved have the money, the need, and the authority to buy. This is easier said than done in many cases. Sometimes the best you can do is infer that you are not dealing with the real decision maker. This can be truer when someone seems to be the right person (or says he or she is) but there are some missing buying signals.

For example, maybe the prime contact indicates the need to consult a higher authority about some aspect of the proposition. Try not to lose control of this opportunity to join the contact in meeting with the higher authority. Have a standard reason you can use that supports your request to go to the meeting.

Perhaps the prospect is simply too nice to tell you to “get lost.” You may have developed a good working relationship and the two of you get along well. Maybe the prospect is enjoying your attention. In this situation the prospect will often delay by asking for more time to think about it. You find yourself making constant follow-up calls but seeing no real progress. This is the time to review the whole proposition with the prospect and ask what additional knowledge the prospect expects to learn by thinking about it, since you have answered every question and proven the value of your proposition.

Some prospects will delay the inevitable by pushing for changes in terms and conditions without actually intending to buy. They lack the forthrightness to tell you they are not truly interested. Perhaps digging into the reasons behind the repeated requests for changes in the “deal” may indicate the need to cut and run.

In these and other situations a sales person needs to become decisive. Yes, you are not working in a marketplace filled with an infinite number of prospects, and so you are not happy to be the one to break off the relationship. And it doesn’t mean you will never revisit the opportunity. Certainly do not burn bridges in cutting off your sales efforts with a prospect. Find a way to leave the door open and maintain your “right” to contact the prospect at a later time. But bringing reality into your current pipeline is an energizing activity.

So as you look at your year-end marketplace activities, be honest and ruthless about your opportunities. Classify your pipeline and work on those that are ready to buy. How do you know who is ready to buy? These are the people who have convinced you they have the money, need and authority. You will be convinced when you “vet” them properly and thoroughly. In today’s economy you cannot afford to do anything less.

Persuasion is fundamental to sales and effective leadership. We need to convince someone to accept our product, service, or point of view. Welcoming an objection to our proposal is alien to most of us because we think it means we failed to sway the prospect. But experienced sales people know that rather than leading to rejection, a well-handled objection is the fast path to a sale. An objection means you are making progress. The prospect is giving your proposal serious consideration.

Objections are opportunities to sell, and an indication of interest, or at least curiosity. Usually they show up in the middle or near the end of a sales call. If they don’t show up, good sales people will try to draw them out because the reasons for an objection are really the keys to the sale.

People make buying decisions emotionally and justify their decisions with facts. A case in point: as a serious photographer I enjoy buying gear to make my photography more interesting or creative. For several years I have watched the development evolution of a new creative lens called Lensbaby. Finally I bought the newest and most expensive version. This was an emotional decision, but I justified it on the fact that it would enable me to create stronger images for monthly competitions. My original objections involving ease of use were answered by the new version, and the fact that a photographer was teaching its use at a conference convinced me that it had a place in my camera gear. Emotion closed the sale, facts justified the decision.

So look for objections as the opening to satisfy an emotional need of the prospect. But sometimes the real objection is several layers deep. Price is often tossed out as the first objection. But we know people do not buy on price alone. It’s one of the top 3 or 4 considerations, but often not number 1. The challenge is to get beyond price to unearth other objections. One approach is to promise to handle the price question but first ask the prospect what other than price that stands in the way of a sale. Handle these other objections first, and then come back to price if needed.

Digging beneath the first layer of objections can be tricky. You must be sincere and honest. You must promise to answer the primary objection, but you should ask the prospect to help you understand more about their concerns. What is it specifically about the issue that they are having a problem with? If the issue is product or service specs, you will need to explain why the specs are what they are and why that is a benefit to the customer.

Sales people often fail to translate a feature or spec into a benefit for the particular prospect and then, most importantly, to seek the prospect’s reaction to the benefit. Sometimes objections can be handled effectively by the old “feel, felt, found” approach that uses a reference to a satisfied customer. Again seek a reaction from the prospect.

Remember to stick with open questions in digging into an objection. “What” and “how” questions are less threatening than a “why” question. Although you may get more specifics with a question starting with “why.” Some have said it takes seven levels of “why” to get to the base objection, but I think that would be hard to do without angering a prospect and losing the sale.

Newer sales people often fear objections and will shy away from responding properly. Two things they need to remember: 1) Know their product, themselves, and their prospect so they have a high degree of self confidence, and 2) Never make up an answer. Instead be honest with the prospect by saying that they will find the answer and get back promptly. Then be sure to do just that.

Most of us do not relish handling objections whether from prospects or employees, and yet they are the fastest way to clearing the air to make the sale. There are some helpful sites on the web for picking up techniques. Here are two--

http://changingminds.org/disciplines/sales/objection/objection_handling.htm and http://www.dummies.com/how-to/content/six-steps-to-handling-sales-objections.html.

Just Google “handling objections in sales” to find many more.

Maybe your sales efforts are so good that you cover everything the prospects wants to know and you can close the order without the need to handle objections. Congratulations! However, I don’t believe that is a frequent occurrence. Instead, we are all regular people trying to show prospects how our product or service meets their needs and relieves their “pain.” We believe our offering is right for the prospect. When the prospect doesn’t see it our way, we need to elicit why and then handle the objections to move toward closing the order. Sometimes it can be frustrating, but it’s our job to help the prospect improve his business success with our product or service and that takes patience and skill in handling objections. So welcome the objection—and know that it does not mean rejection.

After you have identified your target market niches for 2009 (concentrating on revenue retention from current customers and seeking new revenue in all the right places) it is time to decide what steps to take to bring in the revenue.

Marketing and sales differ, of course. Marketing activities are to generate qualified leads, and sales activities are to take the leads to a successful, prompt conclusion (i.e. get an order from good leads, and quickly drop leads that have limited potential to close.)

Here are some areas to consider in developing 2009 sales and marketing activities that do not cost a fortune to implement.

More B2B sales are made through referrals than any other way these days. Prospects are more willing to give you a chance if they know someone who has used your product or service. The problem is most of us are afraid to ask for a referral. It’s awkward, isn’t it? Well, if someone is really happy with what you do for them, they are probably comfortable giving you the name of someone they think might want to use your product or service too. Asking is the only way this will happen. And what’s the worst response you will get? Probably nothing more than a polite “can’t think of anyone right now.” Here’s a website with a useful article “7 Sure Fire Ways to Build Your Referral Business.” Check it out at http://sbinformation.about.com/cs/advertising/a/aa020203a.htm

A close second in using customer help in building business is getting testimonials. These endorsements for your business can be used on your website, in marketing collateral material, and in your sales presentation portfolio.

I’ve asked customers to provide testimonials and it usually has been a difficult process to complete. They took forever and when it showed up, it was not as good as I would have liked. But then it's awkward to go back to get an improved one.

A better way to go about it is to tell the customer that you know he has found your product/service valuable. Tell the person your understanding of the specific value you believe he has experienced. Explain that your company likes to use testimonials. Next ask him if you could send him a draft of a testimonial for his review and approval. Follow through promptly with a draft and be sure to include his name and company at the bottom as part of the testimonial. Unsigned testimonials are not too effective. If there is a confidentiality problem with this, suggest his title and a generic industry description be used at the bottom, e.g. Chief Financial Officer, Large Eastern Manufacturer. If someone later questions this, you can, with the CFO’s permission, identify the company specifically. You can find a useful article on testimonials at http://www.sitepoint.com/article/testimonials-increase-sales/

There is another way to find prospects/suspects. Consider using an online lead provider, like Salesgenie. You can slice and dice the lead search a number of ways and to give it a try, you can get 200 leaders free. Check it out at http://www.salesgenie.com.

Improve your sales productivity by using contact management software. Google the term and you will get a good list to consider. Most popular is ACT by Sage. Good contact management software gives you a complete, integrated view of your contact relationships. It promotes the follow-up that can make a difference between winning and losing a sale.

The Internet is more important than ever in generating leads. Everyone turns first to a search engine to find a supplier. So if your website needs freshening, this is the time to do it. Look at your website with an objective, critical eye. (Or get someone else whose judgment you trust to look at it with you.) Does it have a look that matches your collateral material? Is there a call to action on each page links to an email form? Can a visitor sign up for your newsletter?

But even more important is the need to be sure your website address comes up on the first page of a relevant search. Search Engine Optimization (SEO) is now an arcane science that should be outsourced. Costs can range from a couple of thousand dollars for a six month program to four or five times that. Selecting an SEO provider can also be tricky. Perhaps a referral is the best way to go. But you could also use a search engine to find one. If an SEO provider can come up at the top of the page maybe the company can do the same for you. But certainly ask for references and check them out before committing. SEO needs to be redone periodically. Google offers some helpful guidance at http://www.google.com/support/webmasters/bin/answer.py?hl=en&answer=35291

Have you thought about using Webinars to educate prospects and customers about your product or service offering? It can beat the cost of in-person sales calls by a lot. Yes, it takes some preparation and not everyone is a skilled presenter, but once the Webinar presentation is developed, it is easily reusable. I’ve known some small companies that service the whole country and use Webinars to make individual sales calls. It’s an easy way to present a complex product or service.

Webinars services come in various “flavors” and you need to do a little online research before signing up with any particular provider. Here’s one article on running a successful Webinar: http://www.buyerzone.com/telecom_services/web_conferencing/webinar.html. I’m not endorsing this provider because I know nothing about him. The article is a quick overview of the process, however. There is also a white paper from Citrix Online “How to Present Effectively Online” at http://www.webbuyersguide.com/resource/white-paper/8803/How-to-Present-Effectively-Online. However, you do need to register to download the paper.

Stories in the trade press have always appealed to me as a way to promote a business. While they are not easy to get placed, they provide an implied third party endorsement of your product or service, and they are excellent reprints to use as a “leave behind.” The stories usually are about applications of your product or service, and involve interviews with users, as well as a description of the product or service and perhaps a few paragraphs about your business plus contact information. If you advertise in a trade publication, ask your ad rep for the editorial calendar. Or else go to the publication’s website and look for the calendar there. Check three months and more out from the current month and note what subjects are featured in future issues. When your product or service application fits into one of the featured subjects you have the potential for a story.

Finally, you need to contact the editor to see if there is interest in your story, and if so would the editor assign a writer to work with you on it. Or you can offer to hire your own writer to do the story for the editor, if that is acceptable. Remember that editors need to find material to fill every issue, and they need to have stories that would be of interest to readers. So think like a reader when you are pitching your story idea to the editor. In the trade press, by the way, the traditional wall between the advertising and editorial departments is a lot lower than in regular publications. So if you advertise, you may have a built in favorable bias.

This blog has gone on too long! Sorry, but I kept thinking of ideas and adding them. I have still more, e.g. writing press releases that get printed, low cost postcard direct mail lead generation, and using email newsletters. But I’ll cover these in a later blog.

Ram Charan, one of my favorite business gurus, has published a book “What the Customer Wants You to Know.” The subtitle is “How everybody needs to think differently about sales.”

As I scanned the review from Business Book Review (www.businessbookreviewcom) I expected to see some revelation that would open new insights into selling in today’s marketplace.

The review says that the sales process used by most companies today has changed little through the decades. These processes had their roots in a seller’s market where supplies were tight, deliveries long, prices non-negotiable, and sales people were order takers.

Well, that may be true for the huge companies Ram Charan works with, but it reflects neither my understanding of the sales world confronting the owners of small businesses over the last 20 years, nor my training and experience as a salesman for IBM.

Ram says customers are looking for suppliers who can help them develop their business, improve their earnings, and keep the cash flowing. Duh! Of course they are. What’s new?

But wait, maybe that approach is not as second nature for most salespeople as I think it is. How have you trained your “feet on the street?” Or perhaps more importantly, is your sales incentive plan in synch with the way you train your sales people?

Certainly you tell your customer contact people to ask good, open-ended questions to develop an understanding of what the customer needs. And while you probably tell them it’s best to “sell off the wagon,” do you also tell your sales team to bring back the needs of customers that you might be able to meet with some product or service modifications? Few businesses can actually direct the market; most must be market directed and the feedback from customers and prospects can play a big part in helping you lead in the marketplace with products and services customers want.

Getting your sales compensation plan in synch with the need to be responsive to customers may entail taking a fresh look at what you are “saying” in your plan. If the plan is 100% commission, it means your sales people will need to sell products and services that they have available and can close quickly. On the other hand, if the sales person receives a salary plus commission, it can be argued that the salary is to pay the rep for the time spent developing customer relationships and discovering unmet needs.

One thing about sales compensation plans is that they need to be simple and flexible. Smart sales people will be “sales plan driven.” They will learn where the gold is hidden in the plan, and that’s what they will sell. Sometimes it can be good to add the gold only as a short-term product bonus that will expire in a month or two. Keep the primary incentive compensation based on overall performance against a quota or total revenue, and calculated on a year-to-date basis paid monthly with charge backs and credits figured in.
Another important way to keep a sales team focused on the customer’s needs is to have regular key account reviews. These can be for prospects and customers. The review ought to include a discussion of the customer’s current business situation, the results of contacts made by the sales rep, review of an annually created plan for sales to the customer, and a discussion of strategic actions the rep plans to take. Then you should be sure to inject some accountability procedures to track progress.

It’s always been my philosophy that sales people will say what you expect, but will do what you inspect. And the best thing about managing sales people is that it is abundantly clear how well they are doing. The annual review for a sales person is pretty straightforward: Did the rep make the numbers?

The toughest thing about managing a sales person is deciding if you’ve made a hiring mistake. How long do you give the newly hired rep to prove his/her ability to sell for you? I’ve made mistakes in hiring sales people throughout my 40 years in business, but in each case it was very difficult to let a new hire go. Sometimes it happened in only three months; other times it was over a year.

I think the most important thing in developing a good sales person is to pay attention to what Ram Charan says. Be sure your sales rep is truly knowledgeable about the customer and recognize the good performers with lots of praise and encouragement. Your best sales people are gems worth keeping in the company vault. The best sales people already think differently about sales. And if you have one or two like that, just “be lucky.”