Previously we have written a number of articles about an issue that is currently a problem in many business sectors and that is prospects who delay making decisions, or become un-contactable, once a proposal or quotation has been submitted. This can happen in any type of businesses but seems to be hitting those selling B2B the hardest.
The solutions that we have proposed in the past focus mainly on changing how the process of engagement is conducted from the very first point of contact with a new potential customer. Whilst this is the only effective way to bring about a long-term and permanent solution the use of ‘compelling events’ will in some cases help to move an opportunity that has become stuck.
The most common compelling events involve the use of time or money to get the prospect to “act now”. While both have a place they are often used in a very unsubtle way which risks doing more harm than good. So, in this article we have provided some tips as to how this powerful tool can be used to unstick some deals and if applied rigorously to new opportunities it will help to avoid the sales pipeline log-jams of the future. This will help you to gain some certainty about if, when and how a prospect will make a decision and in some cases whether they will make that decision in your favour.
Viewed as a buyer
For suppliers to understand how to use compelling events to smooth decision making it is necessary to first understand decision making through the eyes of the potential customer.
A compelling event is quite simple in concept; it is something that prompts the prospect to make a decision. At a high level decision making falls into two main areas; to satisfy a need or to satisfy a want, for example, you need to insure your car and your house but although people say “we need a holiday” this is in fact a want driven decision. Need based decisions are driven by the head while wants are driven by the heart. However, in most cases, there will be a mix of head and heart even though one will dominate.
So, taking the insurance need above, if your insurance expires at midnight tonight you must make a decision during business hours today; time becomes the compelling event. If however money is the compelling event, early research will be required; to obtain several quotes and then drill down into the detail to make the final decision. When getting down to the fine detail of the similar quotes the heart may start to play a part in the decision making as you choose between known and less well known providers and their ‘specials’.
The holiday is mainly about satisfying a want so is driven by the heart but as you close in on the final choice, money will become a factor and the head will get involved.
While the examples above could apply to a business they are more typically personal buying examples. A common business issue requiring a decision could be about a new website; do you need or want a new website?
- If the website is delivering less and less good enquiries and it is a key route to market for you then you need a new website.
- If the website is still functioning well but you feel it is looking a little dated then you may want to replace it.
Note the hard fact of falling levels of enquiries = need whereas “feeling” that the website looks dated = want; head and heart.
Viewed from the seller’s point of view
Simplistically this is a mirror image of the buyer’s view point and the concept really is quite simple. Find out what really matters to the buyer, satisfy it and it will increase your chances of getting an order when you want it to happen. The point to emphasise here is what matters to the buyer? Sellers make offers that they hope will be compelling but all too often the offer is driven by the seller’s need rather than the buyer’s. “If you buy by X date we will give you an extra 5% discount.” The seller wants the order by X date but does it matter to the buyer? Will 5% incentivise them to make a decision now when they do not really need what you are selling at this precise point in time?
The problem here is that the inducement is focused on the monetary aspects of the transaction and will have the effect of destroying any work that has been done to build interest in the value of what is being offered. Even if the decision is delayed for another two or three months the supplier may still feel obliged to give the extra 5% but they have not gained what they needed; an order now!
Useful examples of compelling events
Time: most effective when you know what matters to the buyer and this should be established as early as possible in the engagement process. This gives you the opportunity to discuss timing with them as a part of the complete negotiation and they might agree to a timescale to suit you. Calling them today looking for an order by the end of the month can only ever look desperate.
Time can be useful in a number of ways:
- If you genuinely have limited stock “buy now while stocks last” can work.
- If what you provide is seasonal then timing is important. No point taking an order so late that the Christmas cards get to the shop on Christmas Eve!
- If what you are selling will save them money, has a safety implication or could prevent an expensive problem occurring then the sooner they have it the better.
- If you can provide a solution to accommodate an impending regulatory or legislative change, they have a limited window in which to decide.
- If you know they are running out of stock they have a real need to make a decision.
- If you know their current supplier contract is up for renewal, regardless of how happy with that supplier they claim to be, this is a great time for you to propose your solution.
Money: most commonly used through a discount offer but as with time, calling a few days before the end of the month and offering a discount for a decision is transparent and looks desperate. If you do offer a discount it must be tied to something that you need or want and if it does not happen you must withdraw the discount offer – I know you won’t want to but you must!
Money can be very useful to create a compelling event:
- If you are able to demonstrate through, for example, the RoI that will be gained by buying your proposed solution then the buyer will have some tangible evidence as to the value of what you will deliver. If what you sell reduces energy costs then the sooner they have it the more they can save.
- If you genuinely have a price increase coming along in the new year you should share this with the buyer as they may wish to buy ahead to save money.
- Discount can be useful in some businesses but in others it will have little effect; but beware as there is always the risk that it can damage your brand and also any case you might have built up based on the value of what you do.
Problems: Understanding the problems your prospect has will provide the raw material for building your case around a compelling event.
- If the company has breached a regulation such as Health and Safety and what you provide would have prevented this breach they will be interested.
- If buying your solution now will help them defend their case with the H&S Executive they will be interested.
- If the business has lost money due to a production failure that your solution would have prevented they will be interested.
- If the company is suffering high levels of staff turnover, and you can help them reduce this, they will be interested.
It is important to note that the examples above are generic as this will be read by people from a cross-section of business and industries types. This technique is at its most powerful when used by a supplier who really knows what makes their industry tick and what really keeps their customers awake at night.
The other thing to bear in mind is that the supplier must take the actions to create the feeling of ‘compulsion’ in the prospect. A useful technique for this is the SPIN® approach to selling. In effect SPIN® is a specific application of the structured questioning approach where the mnemonic stands for Situation, Problem, Implication and Need-payoff. By asking the sequenced questions you will be exploring the situation the prospect is wrestling with, help them define the associated problem, help them to realise the implications of not resolving the problem and finally you demonstrate the value you will deliver by satisfying the need.
Within the above process; around the ‘P‘ and ‘I‘ stages, you will be able to demonstrate your industry knowledge and perhaps even introduce new ideas they had not considered that will make working with you even more compelling; you are an extra brain on their problem!
Thank you for reading this, but don’t let those queries slip away unanswered, or for a deeper discussion on researching your prospect to create compelling events, feel free to get in touch.
(Photo: Kakakrokodil, Flickr)
Article produced for Talk Business News November edition