As true road safety experts will tell us the killer is inappropriate speed for the conditions; this is also the case with sales deals – the pace of engagement needs to match the needs of both parties. Overselling is characterised by the sales person doing more than is required and never quite getting to the point of asking for the order and they usually lose as the prospect will have passed the point when they were most likely to have said yes. This is an example where the speed is too slow for the conditions.
A common example of a situation where the speed is too high for the conditions is the classic double glazing story where the sales person takes up residence in the potential customers lounge and stays until they get the order. The householder may well say yes just to get rid of the sales person but cancel the order the next day. Not only is this a waste of time for both parties it will cause some damage to the supplier’s brand.
To understand these two related issues and offer some insight to the antidotes and potential cures we look at these two prime culprits below …
Speed Kills? So set the pace appropriately!
Should I be Mr Hare or Mr Tortoise today?
There is a general feeling these days that everything has to be instantaneous but impatience is now a common cause of poor decision making. The example quoted earlier, where a prospect says yes at the point of sale then cancels the order later, is what is known as “buyer remorse”. Having acted in haste, the buyer is avoiding the second part of the saying which is to repent at leisure. Even worse, not only does the first company lose the order it often opens the door for a competitor – the first company does all the work educating the prospect and a competitor collects the prize.
In business there are guidelines such as calls to be answered within three rings, or if someone making an enquiry leaves details we must get back to them within two hours. While I fully agree with the setting of targets it becomes an issue when the speed of response is deemed more important than the quality of the response which, in my experience, is often the case these days.
I mentioned the example of the double glazing sales person in the domestic setting and other examples would include the various miss-selling scandals connected with financial products. Most of us have experienced this or at least know someone who has but the problem is not the preserve of the domestic setting and is also present in B2B sales. This behaviour is typically driven by the supplier wanting the deal to be done this; day, week, month, quarter and is a clear case of the commercial needs of the supplier driving the rules of engagement. This pressure often leads the supplier’s sales people to ignore or subjugate the needs of the potential customer and is at its worst when sales people are “commission only” as they need to make sales to live
This behaviour usually comes with inducements from the supplier such as; discount, BOGOF, free maintenance, pay for 12 months get three extra months free, etc. This is a major cause of mistrust of sales people as the “offer” can feel too good to be true which leaves the prospective customer suspicious when what is required for effective commercial engagement is trust.
An alternative word to speed, which perhaps better portrays the topic, is pace. For a business negotiation to proceed successfully, the parties need to be moving towards the shared goal at a similar pace and towards an agreed date for arrival. There will be typical patterns for different industries and types of proposition. The sales cycle for commercial aircraft is measured in many years while a decision to move to a hosted cloud solution might be two to three months for a small business stretching out to nine to twelve months for a large business with multiple sites and 100s of users.
So, knowing your industry and what might be typical is an important input to the thinking. Of greater importance to knowing the industry norm is putting in the effort to “know” the individual prospect otherwise the result will be a generic response to an individual need.
Here are some tips for creating your own rules of engagement:
- Review the timescales associated with deals you have done in the past two to three years. Look for patterns to create guidelines that you can apply to future deals and be aware of changes that may have happened over the period of observation (many businesses are reporting lengthening sales cycles).
- Lay out the steps you need to go through in getting from a first meeting with a new contact through the point of identifying an opportunity for which you will submit a proposal. Allocate the time you think will be required for each step taking account of the information you have about past deals.
- Define the steps required to pursue an opportunity through to the point of decision. You will need to give due regard to all the factors the typical customer expects; formality/informality, RFIs/RFPs, allocation of time for; multiple meetings with multiple contacts, presentations, proposals, site visits, etc. If you collaborate with people outside of your business to help win new work you will need to consider their time constraints.
The combined results of these steps, will enable you to create a framework – a skeleton plan and timetable – for a typical scenario when taking a new contact through all the stages of becoming a customer for you.
Combining all of the above you now have the makings of a process of prospecting for new business, you have a model timetable, your staff know what they must do and by when and you know what you need to do to meet prospects’ expectations.
As mentioned earlier to be successful you must consider the individual customer, so why not ask the customer if they have a preferred decision model and associated timetable?
- If they do, review it and if you are happy with it formally agree that is what you will work to.
- If they have a decision model but from your point of view there are critical gaps, then negotiate to fill those gaps and get sign off on the new composite model and timetable.
- If they do not have something, which is more common than you might think, then present your model and ask if they are agreeable to work to it. There may be some debate around detail but reaching agreement should be quiet straightforward and as before both parties should sign off on what has been agreed.
Either of these last two approaches will lead to a win-win scenario in terms of building trust and helping one another to improve the engagement process.
You now know the appropriate pace of engagement for your market and you have a mechanism to determine the correct pace for each prospect so you can set expectations with the prospect, your staff and suppliers. This structured approach will, over time, also enable you to build more realistic and reliable sales forecasts.
This approach will also help in cases, as discussed in the June newsletter, where customer decision making is unpredictable – with an agreed and common process outcomes will be much more predictable.
Health warning – the proposed approach will probably make life harder initially but once the process is established the rewards will become obvious.
Overselling is about doing too much, doing the wrong things and/or doing things in the wrong order. In most cases overselling also leads to suppliers taking too much time to get the prospect to the point of stating their decision.
Remember the 5 Ps
Too many products. If you have multiple products or services focus on the ones that directly relate to the issue the prospect is wrestling with at the time. By all means make them aware of the full range of what you do but in a 30 minute meeting this should take 2 minutes with the rest of the time being focused on the matter at hand and the solution you are offering.
Make sure you do the first deal very well and there will be plenty of time to come back and sell them more of what you do; give them the taster for your solutions and they may be more willing to commit a larger investment next time.
If during the conversation about the current issue they raise a separate unrelated matter, acknowledge it and ask if they are happy to “leave that to one side for now”. If they have decided issue two is more important you can switch, otherwise stick to plan.
Too many benefits. Can there be too many I hear you ask? There can; this starts with an approach where the sales person assumes they know what will be of benefit to a specific prospect. For example, it is common for suppliers to assume that everyone wants/needs to save money. Of course no one wants to pay more than they need to but equally no one wants to buy something that is inferior or unreliable for the sake of saving a few percentage points on the price. A subject discussed in previous articles, is the need to appreciate the difference between Price, Cost and Value when making buying decisions and sales people need to have this in mind when presenting their offer and the benefits.
A tool to help work out what might be beneficial to an individual prospect is FBI – Feature, Benefit, Incentive. The approach:
- In the early stages in the engagement with a new prospect you establish what matters to them with respect to the solution you are discussing; size, colour, weight, speed, delivery time, maintenance intervals, throughput rate, service intervals, repair response times, power usage, … It will differ from industry to industry and within that from prospect to prospect.
- Consider each feature of your proposition and how it can deliver against the criteria that matter to the individual prospect. For example if your product delivers a very high throughput rate, and this is significant to your prospect, they will see it as a benefit of choosing your solution. If this was not an issue then the prospect may see the feature as irrelevant and potentially something that makes you more expensive than a competitive offer.
- Summarise all the relevant benefits your proposition can offer and ask the question “If I can demonstrate that our solution will do; X, Y and Z, and that we can deliver by dd:mm:yy will you go ahead and order from us?” The demonstration that you have the features to deliver what the prospect needs and that you can deliver in a timescale that you know matters to them provides an overall benefit for them in dealing with you which in turn will act as the incentive to go ahead with you.
A benefit only applies if it satisfies an explicit need and anything else is just hot air that, far from adding value, is certain to detract from the things that you can do that actually matter to your prospect. Scary I know but even for complex deals three or four benefits are probably enough.
Over promising and under delivering. Do I need to say much on this? Too many potentially good relationships are spoilt by suppliers offering more than they can deliver and even if the prospect needed everything offered it would be far more honest to offer what can be delivered well, as you will be quickly found out.
Find out the real needs, focus on your features that satisfy those needs (by delivering the benefits that matter), confirm and re-confirm that the list of requirements is complete and that your prospect acknowledges that you can deliver the complete solution.
Now; some good advice from way back runs “ask for the order and shut up”. We all have two eyes, two ears but just one mouth; use them in that proportion. Don’t break the silence, don’t offer to do more; make the offer, ask the closing question and shut up.