Monthly Archives: May 2011

How to Sell to the Entire Buying Team to be CompetitionProof

Savvy sales people understand that few purchase decisions are made in a vacuum without the decision maker consulting others. If you miss even one member of the team, you can lose to a better-prepared sales person. You’ve got to identify the players or you’ll be left out in the cold.

Here are the people involved in the decision-making process, either directly or indirectly.

Gatekeeper

The gatekeeper is the receptionist, secretary, nurse, administrative assistant, spouse, or voicemail. The gatekeeper answers the phone and guards the door to the rest of the organization. They are trained to say, “no,” and don’t have the authority to say, “yes.”

Sales people usually treat gatekeepers with disguised contempt. Sure, they’re nice to their face, yet sales people do everything they can to minimize the gatekeepers power.

Yet gatekeepers have great influence on the decision making process because they decide who gets consideration. More than one gatekeeper has killed a deal by mentioning, “They’re real jerks. Are you sure you want them working with our people?”

Sales people often try to bribe them with food or small gifts. Yes, these would be effective if every other sales person wasn’t using the same tactic. Executives often resent their gatekeeper being bribed. They see extended interaction with a sales person as taking them away from their prime task.

Savvy salespeople treat gatekeepers with deference and respect. Treat them as if they run the company. Because they do. 

So, sell to them first. Let them know what you can do for their organization, what problem that you can solve, and how you can make their headaches go away. Ask them for a favor, “Will you help me? I know that you know who’s the best person for me to speak with. What’s the best way for me to approach them? What drives them crazy?” Ask them when is the best time to call. 

Ask them when other sales people usually call, so you can avoid those times. Ask them if you can call in advance to see what the schedule looks like that day.

The gatekeeper is an incredibly valuable resource. They know the politics and will tell you things that no one else will.

Influencer

The influencer is someone who has technical or financial knowledge about what is being purchased. An influencer can be someone who has successfully used your product, or has read good reviews about your products, or is skilled at analyzing your type products. They influence because of their respected knowledge and wisdom.

You find influencers by asking, “Who else, besides yourself, is involved in making this decision?” Even if you think you’ve found the decision maker, continue to ask everyone else this question.

Once you’ve found the influencers, ask them, “What process do you use to make your decision?” or “How will you know who’s the best vendor?” or “What criteria do you use to make your recommendation?” Once you know their decision process and criteria, you’ll know exactly what to show them, do, and say for a favorable decision.

Economic Buyer

The economic buyer places the order, sends out bids, issues a purchase order, or is the end user. The economic buyer may be charged with getting the best possible price for what you sell, so they may bid you against your competition.

All things being equal, the economic buyer chooses lowest cost vendor. Your job is to ensure that nothing is equal. Buyers will almost always choose reliable delivery over lowest price. Win them over by illustrating that you’ll always deliver at a fair price.

Decision maker

This is the person who ultimately makes the final decision and takes responsibility for the choice made. They can say “no” when everyone else says “yes,” and vice versa. Most sales people are taught to find the decision maker and sell to them. Yet most decision makers are not influenced by sales people. Decision makers are influenced by their staff – willingly or unwittingly. The decision maker will be most influenced by you when they regard you as a professional colleague.

Approach the decision maker with a summary of what their staff suggests. “I’ve had your team review this product and here are their comments.” Go over how your product will take them closer to their goal and ask for their commitment. When the staff is on your side, the decision maker will almost always give you the nod.

User

The user is the ultimate decision maker. The people who use what you sell ultimately will decide if the purchase decision is sound. Users can sabotage the purchase decision.

Savvy sales people will invest time with users to understand their concerns. They then offer the decision maker solutions that preempt user issues and instill confidence in the ultimate success of the purchase decision.

Spy

The spy is someone who, for their own reasons, wants you to get the business. The best spies are people who you have served well at one facility and have moved to a new location. They want you to serve them like you did before.

You can recruit a spy by seeking the advice of a non-decision maker. These people are flattered by your attention and will tell you things that no one else can or will.

The Decision-making Team

When you get all of the team pulling your direction, the purchase decision will go your way, and you’re CompetitionProof.

 

 

Create Differentiation from Your Hidden Strengths

Frequently companies ask me to help them create ways to differentiate themselves and their products from competitors. This strategy pays off big because with clear differences, they can sell based on value instead of price. Rarely can a company really come up with real differentiators–they can’t see the trees for the forest.

You don’t know your differentiators until your customers tell you what they are. And those differentiators will change over time.

Let me share with you some of the secrets of how you can do this on your own. 

Discover Your Strengths 

Start by asking your happiest customers why they buy from you. Take them out for a meal and interview them about their reasons for choosing you instead of the competitors. Ask them, 

  • “Why do you buy from me?” 
  • “What makes you the happiest about our company?” 
  • “What would cause you to buy from another vendor?” 

Take notes and prepare to be amazed at the answers you get. You may wish to take an audio recorder (or use your smartphone’s recording function) and ask to record the conversation for audio testimonials on your Web site. 

Discover Your Competitor’s Strengths and Your Weaknesses

Phone customers who have defected to your competitor to find out why they left. You might think that it’s difficult to get a former customer’s attention, but they’ll give you a few minutes if you tell them, “I really want to know what happened so that I won’t make the same mistake again.” 

When they agree, ask 

  • “What was it we did or didn’t do that caused you to leave?” 
  • “What did the competitors do or not do that caused you to switch?” 
  • “What could I do differently to win you back?” 

Even if you don’t get their business back, you’ll discover important information about the competition’s strengths that you can counter with your own strengths. 

Discover Your Competitor’s Weaknesses 

Interview customers that you’ve won away from the competition. Ask them, 

  • “Why did you choose me over the competition?” 
  • “What did the competitor do or not do that made you change your mind?” 
  • “What did I do that made the difference?”

Position Yourself with Your Customer’s Words

Now you have everything you need to present real, powerful differentiators to prospects. Bring them up early in the conversation to defuse the competitor’s position before your prospect brings them up. You can present them with real power if you frame them with the phrase, “My customers tell me that they choose me because…”

Continuously Schedule Customer Interviews 

Make a point of repeating this process regularly so that you’re operating with the latest reasons, because your competition probably isn’t sitting still. It’s also a great reason to contact customers and lost customers as part of your regular sales activities.

Getting Customers to Buy: Rewarding the Behavior You Want

“I want you to put together a kick-butt program to get our new product line going ballistic,” your boss tells you. “And I want results. None of this spend-a-bunch-of-cash-and-get-no-payoff garbage, either. Oh, and make it interesting.”

Your boss leaves your office and you have one more complex project to add to your already overloaded schedule. Where do you start? How can you make sure the program works? How can you make it interesting? So you start by thinking about what would be the ideal incentive program for you, personally. And, being brighter then the average human, you consider the elements of human behavior.

Any Behavior that is Rewarded Tends to be Repeated

Virtually every study on human motivation shows positive reinforcement of a behavior leads to that behavior in the future. Conversely, negative reinforcement of a behavior tends to discourage that behavior in the future.

The secret to a successful incentive program is to make the prize a positive reinforcement. One can learn a lot by watching animals in training, a child learning a new skill, or an executive negotiating the first few weeks of a new position. In every case, new behavior is quickly learned and reinforced with small, often subtle rewards. For a dog, a tidbit for a trick; for a child, a hug and a smile for trying to walk; for an executive, access to information for following corporate protocol.

What’s Their Motivation?

You’ve probably noticed that a percentage of people aren’t influenced by your incentive program, no matter what you offer. About 40 percent of the North Americans are primarily internally motivated. They know they’ve done a good job when they feel like they’ve done their best. You can recognize internally motivated people because they are less interested in what other people think or do. They tend to be independent thinkers, not as interested in what you’ve done for others, but more interested in what you can do for them. They make choices based on personal ethics and morals.

The most effective incentive programs are based on activities that internally motivated people are already committed. An incentive program makes it easier for them to do what they’re inclined to do. A powerful reward could be a donation to a favorite charity in their name.

Externally motivated people are motivated to “look good” or do things because other people tell them they should. They seek acceptance and an incentive program delivers tangible proof of acceptance.

Most sales people are externally motivated. Sales positions attract externally motivated people – they’re motivated by quota and rewarded with commission and sales contests. Sales people will work night and day for a $35.00 plaque and a pat on the back. They tend to quit working hard once they’ve reached their numbers. Well why not? Their manager can’t fire them: they’ve reached their sales numbers.

Externally motivated managers insist that commission is the only way to motivate a sales person. They’re right if they only hire externally motivated people.

Create a Powerful Incentive Program

So you begin designing your incentive program by answering three questions: Whose behavior do you wish to influence? What behavior do you want to have repeated? And when and where do you want that behavior repeated?

Who Do You Reward?

You can reward employees for meeting production and safety goals, or sales staff for reaching sales and profit goals. You can reward superiors for their support of the staff or innovation in increasing profits.

You can reward your friends for helping you move to a new house or for taking care of a pet.

You can reward customers for their loyalty, for purchasing more product, more often, or for referring new business.

You can reward prospects for paying attention to your sales message or for directing other prospects to your business.

The most successful incentive programs include rewards for people who are influencers or who are important to the program participants. For example, selecting prizes that a spouse will find attractive increases their support. Prizes for the team increases the team’s moral.

Why Incentive Programs Fail

Many incentive programs reward the wrong behavior, or reward behavior that is likely to happen without an incentive.

Or worst of all, the “reward” creates negative reinforcement. For example, it’s insulting to offer a bottle of wine as a reward to someone who’s going to AA meetings. It’s less effective offer sports tickets to someone whose spouse hates sports than to offer a romantic evening meal.

Often prizes are selected based on the desires and tastes of the boss supervising the program. Yet not every employee shares the love for modern art prints or golf accessories.

How do You Know You’ll be Successful?

Here are the elements of successful programs. Use this as a check list to make sure your program works.

  • Successful incentive programs result in measurable results. If you can’t measure your desired behavior change, you’ll never know if your program was a success. Build a measurement phase into your program.
  • Aim for permanent behavior change. You not only want a customer to try to your brand, you want them to switch to your brand. Price-based incentives tend to attract price-sensitive buyers. You don’t want people without loyalty who will switch to the next vendor with the lowest price.
  • Create programs that increase profits. The only true measure of success in business is profit. Know how much this program can bring to your bottom line.
  • The promotion must be easy to run and require little or no staff training. If you need a complex document spelling out the rules and exceptions, your program is doomed to failure. A successful promotion can be described to a 12 year-old in 30 seconds.
  • The most effective promotions use multiple influence agents. (See sidebar below: how to influence your target audience.) These are the factors that motivate people to do things. Isn’t that why you’re launching an incentive program.
  • Align with a commitment your participants have already made. The hottest programs let people meet multiple commitments. For example, when Total Petroleum ran “Total Thursday’s,” in selected markets, you could simultaneously fill up your car, get a free drink, and donate a few cents per gallon to your choice of charities. The brilliance of this incentive program is it let people give to charity – something most people want to do – while filling up their gas tank – something to which most people are committed if they’re going to drive to work. The program broke all sales records.

Reward Your Employees for Profits

Most progressive companies offer profit sharing for employees, most often by creating a pool and dividing that pool by a formula that gives more to higher wage earners. In three studies for his graduate degree, TAFA ( Concord, NH) Senior Marketing Manager Elliott Sampson discovered that the most effective profit sharing plan split the pot equally with all employees. When the president gets the same share as the janitor, the president will listen to the janitor’s money-saving suggestions. Relatively large gains in profitability occur when you reward saving money and increasing profits at all levels.

When you’re creating an incentive program to promote other behaviors, such as quality control, waste reduction, safe behavior, let the participants decide on the reward. You’ll discover they’ll usually pick prizes smaller than you had in mind, and may select social events – a keg party or pizza night – over other prizes.

Reward Your Sales Force for Knowledge

Perhaps you want your sales force to sell more profitably. The problem with most sales incentives is that it rewards behavior that by their job description they’re supposed to exhibit: selling things. Savvy sales managers reward behavior that is beyond job description.

For example: next sales contest, reward competitive knowledge. Have your sales people learn about your competitors, their products, and their customers. Have pop quizzes, and hand out prizes on the spot for correct answers. You reward behavior that is proven to improve sales – there’s no better way to increase your confidence in your product. Best yet, your sales people are more aware of competitive activity long after the contest ends.

Reward Your Customers for Loyalty

Every marketing manager agrees, it’s more profitable to sell to an existing customer than to find a new customer. So why not reward your existing customers for being your customer.

Often marketing programs encourage new customers to buy at the exclusion of existing customers. The offer giveth: “Sign up for a year’s subscription at the trade show, and we’ll give you a free leather briefcase.” The small print taketh away, “Not valid for renewals.” Oh, great! Tell your customers that they don’t deserve a leather briefcase for their loyalty. It’s enough to make them cancel their subscription and sign up anew.

An unconventional approach is to give your customers a better reward for renewing on the spot, and offer new customers a lesser reward. New customers learn you appreciate loyalty. When your incentive program focuses on profits, you’ll work hard keeping customers. Your cost of acquiring a customer plummets, and your profits soar.

Instead of giving a customer a dining gift certificate as a thank-you reward, tell them to take their spouse to dinner, and send you the bill. The secret here is to not set a spending limit. The gift is your trust in them to spend what they’d like. You’ll find they’ll often spend less than you had in mind. Use your judgment when offering this incentive to a customer with a history of taking advantage of you.

Reward New Customers for Saying Yes

Often, marketing managers create incentive programs so new customers purchase sooner rather than later. When you understand the psychology of a buyer, you’ll better understand how to influence them to buyer sooner. People buy to satisfy a personal urge or desire and to fulfill a commitment they’ve made to someone important or influential in their lives. They won’t buy unless there is a compelling deadline to move forward. That deadline could be driven by pain or hunger, a project deadline imposed by a superior, or the desire to have new shoes for the party tonight. New customer incentive programs work best when they move up the deadline.

Many sales people use a discount to impose a deadline. “I can give you a 10% discount if you buy now!” An item being “on sale” rewards customers for buying during the sales campaign.

A better approach is offering an added-value reward. Estee Lauder beauty products never go on sale. Yet often you’ll receive, “$25.00 value gift when you buy today.” This works since the gift is more of what they sell. The beauty industry knows that they’ll sell tons of cosmetics when they turn a sample into a reward.

Kick Off Your Event

Now that you understand what behavior you want to encourage and you’ve researched the rewards that are meaningful to your group, you plan a kick-off party to let everyone know about the program. At the party, people make and accept challenges. You stimulate and encourage statements like, “I’ll hit my quota in 10 months,” or “I’m going to beat your number, George.” Using the power of public commitments, you not only guarantee a program that works, but you’re boss is overwhelmed by the success of the program before you’ve handed out a single prize. Congratulations!

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Sidebar: How to Influence Your Target Audience

Professor Robert Cialdini, in his book “Influence: The Power of Persuasion,” identifies six factors that substantially influence people. When you use any of these influence agents in your incentive program you’ll increase your success. You’ll have the most impact when you can use all possible influence agents.

Consistency

People tend to act in a way that is consistent with public statements. So as part of your program, have participants write, audio record, or video record a statement about their intentions. You could set up a telephone hot line for recording their commitments on voicemail. Transcribe and publish the commitments.

“‘I love working here because…’ in 25 words or less” contests work is because people tend to make positive statements and then act consistently with those statements.

Referral programs are one of the most powerful ways to get customers or employees to stay with you. The secret: when a person who is referred buys or joins the company, the referring person’s behavior is re-enforced. One who gives advice won’t act contrary to their own advice, especially when the advice is accepted by others.

Reciprocation

In many cultures, granting a favor requires a return favor. Random acts of kindness create big emotional ties. One shopkeeper when handed a $20 bill on a $10.25 sale returned a $10 bill and said, “I didn’t want to break your ten.” For 25 cents, the shopkeeper created a lasting impression that he may not have gotten from a more expensive program.

Social Proof

If everyone’s doing it, I guess it’s OK.

Coupons work because we’ve come to believe that a coupon means value, whether it does or not. Referral programs encourage participants to use social proof to our advantage. Holiday tie-ins are a natural, since the holiday is part of our psychology. Trade-in’s allow you to get the old products out of the market, increasing the proof that your product is superior.

Authority

Most cultures are trained to respect certain authority, and respond to their influence almost without question. Deadlines are created and followed. An official product is often more desirable than an unsanctioned one.

Liking

When a person likes you, they are more easily influenced by you. Making charitable contributions in the name of a participant is a powerful way to circumvent problems with gift giving limitations. Allying with associations is an easy way to transfer the existing relationship with the association to your company. Associating with sports teams often creates instant liking with fans.

Scarcity

Anything that is perceived as being scarce is perceived as being more valuable, even though it may not have better functionality. Offer serialized, limited edition gifts, autographed memorabilia, or antiques for increased impact.