More Profits Makes You CompetitionProof: This Video Shows How

If you want lots of CompetitionProof tips, check out the video series, “How to Make More Profits” on the OCE YouTube channel.

I highly recommend that you take the time to check this out. I discuss profit elements that few have considered, especially the impact of discounting on profits.

[youtube http://www.youtube.com/watch?v=aeF36nHen_M?wmode=transparent]

See the rest of the series at http://www.youtube.com/OutsourceChannelExec

I’d love to hear your opinion on this series.

 

The Three Biggest Mistakes Sales Pros Make and How to Avoid Those Sales Mistakes (Is this you?)

Most sales professionals make career-limiting mistakes everyday. There’s no need to do this. Read on to find out what they are and how to do it differently.

Mistake 1: Pitching products instead of finding out what customers need. If customers really knew what they needed, they’d buy it without a sales person being involved. 

For example, a sales person calls and says, “I’ve got a great new computer program for voice dictation that I know you’re going to love! It has all the features that you’ve been looking for. Would you like to try it out?” You don’t have time to try out something new.

What to do differently:  Have a conversation to discover what they need. Lead with the need and you’ll discover deals. Your questions can guide the conversation direction and the answers will guide what you ask next. Information plus implications creates interest.

For example, ask, “Are you finding that you are overwhelmed with answering emails, creating new reports, and trying to stay on top of all your paper work? If so, I have a tool that can cut by a third the amount of time you spend on these tasks. What would you do with your new found time?

Mistake 2: Cutting price instead of adding value. Slashing price trains customers to expect lower prices and devalues your product.

For example, a sales person offers, “If you buy today, I’ll knock 20 percent off the price.” You know that you can get that deal any time you ask for it.

What to do differently: Add value. For example, offer to increase the quantity for the same price. Or offer training with purchase. Or offer a $10 credit for accessories for each $100 spent. The powerful outcome of adding value is that you can make it a limited time offer to increase urgency. And you’ll protect the list price of your product.

For example, you offer, “If you’re on the fence about this, I’ll include a complementary training session to help you get started right away and so that you’ll be successful fast. We normally charge $99 for this session, but I’ll include it today if that would bump you off the fence.”

Mistake 3: Giving up too soon. Most customers need to think about new ideas before committing, unless the offering solves an immediate need.

For example, a sales person just doesn’t follow up.

What to do differently: Ask permission to stay in contact. Offer to update them with new ideas that you believe that they can use. Check in with them with a new offer, a new idea, a new bit of news that they can use.

For example, you say, “I know you’re interested but the timing just isn’t quite right. May I stay in touch with you to keep you updated and to remind you of what we can do when you’re ready?”

Do these things differently and you’ll be CompetitionProof.

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.

How to Sell at Higher Prices

If you’re going to be CompetitionProof, you’ve got to be able to sell at prices that are higher than your competitors because slashing price is a frequent competitive tactic.

Based on my poll of salespeople, price objections are by far the most frequently heard objection. “They’re a good customer, but now they want me to cut my price?” “Why do buyers always ask me to cut the price, even when our prices are competitive?” 

Buyers ask for a better deal because that’s their job! Your customers are often held accountable for getting the best possible deal. Yet that doesn’t always mean getting the lowest price.

I can get you a better deal. . .

Most salespeople volunteer to cut their price without being asked! There is a clinical term for that: stupid. They will drop hints like “of course there’s a discount schedule,” or “It’s the end of the quarter and we want to make our quota.” 

Or they invite price negotiation from the start because they do not believe their product is worth the price they are asking.

Believe in your price

Some salespeople won’t say the price. They’ll offer, “Let me get you a quote…” or they’ll write the price down on a piece of paper and slide it across the table. This behavior signals a lack of personal commitment to the price, opening up a price negotiation. 

If you want to believe in the value of your product, practice this: double your price. Go ahead, double it. Now justify this new price to a colleague. Then roll your price back to the original figure. It will feel like a bargain.

Don’t hesitate to discuss price. Practice saying your price out loud until it rolls right off of your tongue. Deliver it with the same conviction and tonal inflection that you would use to give someone your phone number or telling the time (neither of which are negotiable).

“What’s your phone number?”

“800-743-4349″

“What’s your price?”

“One hundred-seventy-five-thousand dollars.”

Same inflection. You try it.

What to say when you hear “Your price is too high!”

Your customers probably have been trained how to negotiate with sales people. Basic buyer negotiating training tells them to ask for a discount at least twice before making the deal. You’ll have to resist pricing pressure several times to get back on equal footing.

Frequently salespeople respond to a customer’s price push back with a price cut. But wait a minute! Before you do that, find out if a lower price is really what’s necessary to get the business.

When a prospect says, “Your price is too high,” find out what “too high” means. 

“Too high? When you say ‘too high,’ what do you mean? ‘Too high’ compared with what?” 

Find out if you’re two cents too high, two dollars too high, or two million dollars too high.

Make sure that you’re making a tit-for-tat comparison when your customer declares that your price is too high. Odds are it’s not a direct comparison.

“But I can get it cheaper!”

Your customer may try to use your competitor’s lower prices to extract pricing concessions from you. They want your quality, your reputation, your delivery, your support, your guarantee, and your terms, but at the competitor’s price. They’ll compare your competitor’s apples to your apple pie, and ask for the cheaper price.

Frequently your customer has no intention of buying from your competitor. They’re just using the competitor as a negotiating tool.

You can counter this but-I-can-buy-it-cheaper tactic with the negotiating phrase: “We have no argument with those who sell for less. They know best what their product is worth.” 

Or as a vendor in Maine said, “Well, it’s a lot like buying oats. If you want good, clean oats, you pay a fair price. If you be willin’ to settle for oats which have already been through the horse, well. . .”

Now, you’re CompetitionProof!

If you like these ideas, you’ll like this podcast that goes deeper into this topic. 

 

13 Ways to Sleuth Your Competition

What you don’t know can hurt you. Consider this: What if you spent weeks with your R&D, marketing, and sales staff creating your next product introduction and one month later, read in the trade press about a similar announcement from your competition? How would you feel? What would your boss say? What would your customers think? Why didn’t you know about the competition?

As Yogy Berra said, “You can observe a lot by watching.” There are several good reasons why otherwise savvy companies are ignorant of their competitors. Most assigned to the task of gathering competitive intelligence loath the job. They feel it’s a painful, drawn out process, and mostly pointless. They don’t know how to start, where to go, who to call, or what to ask.

Gathering competitive intelligence is actually fun and easy to do. It can make you a hero in your own company. You’ll avoid “stepping in it” and you won’t be doomed to repeating the failures of your predecessors. Your well-thought-out marketing plan won’t be shot down since you can demonstrate that you know what the competition is up to. With a successful plan, you’ll get more marketing dollars.

When you know more about your competition they know about you, they’re dead!

Make yourself the “Corporate Colombo” and have fun sleuthing your competition. Here are 13 ways to get intelligence on your competitors in no particular order.

1.    Adjust your viewpoint.

Most sales and marketing people look at their competition with disdain and contempt. These emotions create barriers to clear thinking and effective planning. Fear and loathing lead to competitive blind spots where you are vulnerable. View your competition as your prospects and customers do. They are curious, open minded, and excited. They’re trying to solve a problem. We tend to be more critical than most customers. We usually focus on things that they don’t really care about, such as, “I hate that color,” or “That’s a bad place for the on/off switch.”

When you analyze your competition, do so as if you were a prospect, someone with positive expectations. Go in with an “I’ve-got-money-to-spend” viewpoint. Or better still, watch a real prospective customer review your competition’s products to get an idea of what they think is important.

The next step is to look at what your competitors sell as if it were the first time you’ve ever seen them. Or ask someone who’s unfamiliar with the competition to review it. You’ll be surprised at what you’ve missed. In the passion of looking for dirt, more than one company has been baited by false information, or worse, has redirected their marketing plans down a dead-end path. Savvy business pros don’t let the competition blindly set their strategy.

Objective intelligence leads to a precise and successful market attack.

2.    Create your own intelligence network

Enlist your colleagues, associates, and vendors in your quest for competitive intelligence. Let them know that you’re always interested in competitive information. Then reward those in your organization who become “industry experts.”

Make competitive intelligence gathering part of your everyday awareness, and you’ll never be blindsided by your competition.

3.    Watch for their publicity

Have your entire staff looking for news items and advertising about your competition. This is really easy with Google alerts.

Watch the employment help-wanteds. Often they’ll reveal information about upcoming projects. You can determine a lot from staffing requirements, especially when you’ve been watching them for a while.

4.    Get all the materials you can

Get on their web site and download everything you can about them and their products.

Study their materials, just as if you were an excited customer getting ready to buy. Print them out and three-hole punch these materials for a three-ring binder and add them to your training library. If you’re a sales manager, you may want to have a pop quiz with your sales people on competitive knowledge.

5.    Ask them!

You’d be surprised what information you can get by asking your competition. For example, Mike, who’s the sales manager at a major hotel in New Orleans had an association executive previewing the property for an upcoming conference. Mike asked, “Where was the best conference you’ve had?” The exec mentioned last year’s conference at a high-profile hotel in Las Vegas.

After the meeting, Mike called the sales manager of that hotel. “Hello, I just had one of your customers in here raving about you. Would you do me a favor? Would you fax me last year’s contract?” It was no problem because the deal was done and it wasn’t a competitive situation.

Mike patterned his proposal after the Las Vegas contract and won the business.

Just because you wouldn’t give your competition the information doesn’t mean that they won’t give it to you!

6.    Go where they hang out

Where do the workers go after work for a drink? Where do they go to lunch? You can pick up lots of interesting information by just sitting back and listening. Or encourage them with a round of drinks and then listen to them complain.

We’ve heard about more than one industry secret revealed in an overheard conversation in a restaurant, bar, or airplane.

7.    Interview disgruntled ex-employees

Check the grapevine for someone who has just left your competitor. Invite them out for dinner and drinks. Pick their brain by asking questions such as,

  • What do you think they do really well, better than us?
  • Where are we falling down?
  • What three things should we be doing that we’re not?

Steer clear of asking them to violate any non-disclosure agreement they may have signed. You may be liable for misuse of obviously confidential information. Or not.

8.    Take your competition’s customers to lunch

If you want to understand your competitor’s marketing strategy, ask your sales force about a deal that was recently lost to the competitor, and offer to take the buyer to lunch. Explain that you’re only interested in finding out how to improve what you sell so that next time around, you’ll have a shot at earning their business.

Sure, this feels like eating humble pie, and so you might be tempted to reject this idea. But you’ve already lost the sale, so swallow your pride and don’t lose the intelligence the sale generated.

Objectively, without arguing with you hear, ask questions such as,

  • How did you find out about them?
  • What steps did you go through as you made your decision?
  • What were the factors you used to decide?
  • Comparing how we did with them, what did we do well?
  • What could we have done better?

Focus on what the competitor does to win customers, not on how to save the deal. When customers are pushed to reconsider a decision, their natural reaction is to defend and exaggerate the deciding factors. Right now, you want the unvarnished truth.

So consider the lost deal an investment, perhaps an expensive investment, in planning the next battle.

9.    Take stock

Call a discount stock broker and order one share of your competitor’s stock. You are now, in the truest sense of the word, a shareholder. You are entitled to all the information and privileges of a shareholder, and the company information will be automatically sent to you. You are also entitled to attend the shareholder meetings. If you really want to have fun, buy a share of stock for everyone possible in the company. Take a road trip to the annual shareholder’s meeting, and sit on the front row.

Don’t disrupt! But can you imagine the impact on your competitor’s CEO when explaining how they will increase sales next year, and the competition is literally hearing it first. Enjoy the look on their face when you ask for a plant tour.

10.  Become their customer

Experience your competitor first hand. Buy from them. When most companies buy from the competition, they rip apart their purchase and look for the bad things to point out to their sales people. This works in creating a traditional competitive analysis. But you still don’t have an insight on why others buy from them.

What works better is to use the competition’s products just as their customers do. Most buyers gleefully bring their new acquisition into their lives. To truly understand the mind set of your competitor’s customer, you must (begrudgingly or otherwise) do the same.

Treat your competitor’s orders as you would for your most important customer. Scare them with your exceptional customer service. They’ll assume that if you give this level of attention to your competition, you must really be going out of your way for customers.

11.  Use trade show reconnaissance

A great source of competitive intelligence is trade shows. The booths are often staffed by those in-the-know who haven’t been briefed on what topics are safe and which are out-of-bounds. Because of the unfamiliar show environment, these people are just insecure enough to feel that by talking about “insider information”, they’ll command respect. It only takes a little prodding to get them started.

At trade shows the unwritten rule is: “Seller Beware”. Walk up without your badge and start asking questions. Entire marketing plans have been unwittingly revealed to competitors at trade shows.

12.  Get on-line

Compile competitive profiles that include on-line research from LinkedIn, Google, and Bing. Go to newsgroups that customers are likely to frequent and post questions about competitors’ products as well as your own. You’ll find the responses pointed and pragmatic.

13.  Get mug shots

Grab photos from www.google.com/imghpLinkedIn, or other social media sites. Make up a “Wanted” poster so that your staff will recognize them when they see them at events or trade shows.

Adapted from Guerrilla Trade Show Selling with Mark S A Smith, Orvel Ray Wilson, and Jay Conrad Levinson, published by John Wiley and Sons.

 

Getting Prospects to Commit

Sometimes it’s difficult to get your prospect to commit to your solution. Prospects get pulled many directions by your competitors, by their colleagues, and by the fear of making a bad choice.

How can you deal with their lack of commitment?

You might have a thousand reasons why your prospect should choose your product. Ultimately a prospect will decide based on something you probably don’t consider important. To get commitment, you’ve got to figure out what that thing is and make it important to yourself.

You probably already know that people don’t always buy what they need; they buy what they want. Yet many sales people try to sell prospects by telling them what they need. But telling isn’t selling. “If I’ve told you once, I’ve told you a thousand times!” Obviously, telling doesn’t create commitment.

So how do you turn what you have into something that they want? Most people don’t know what they want, but they know what they don’t want! You can rapidly build commitment by finding out what they want and don’t want, and initially focus on just those two areas of your product.

Here are some scenarios and solutions that can help you create commitment.

  1. “We don’t want to commit right now.” Your answer: “I understand. If the timing was right, what would you need from me to commit?”
  2. “We’ve changed our mind.” Your answer: “I’ve changed my mind before. What was it that caused you to change your mind?”
  3. “But I promised the competitor that I would…” Your answer: “I’m confused. You told me that we had a better solution yet there seems to be some loyalty to the other brand. Can you help me understand what’s behind that loyalty? If I called them for you, would that help?”
  4. “We can’t get budget commitment until. . .” Your answer: “O.K. Would you be willing to consider writing a letter of intent because I want to make sure that I can reserve your place in the delivery queue. I don’t want you to suffer because someone can’t yet make a decision on the budget.”
  5. “This has to go to committee for review before we can make a commitment.” Your answer: “I see. Is this something that you’d like the committee to approve?” If the answer is ‘no’, you have lots of work to do. If the answer is ‘yes’, say, “Great. Let me help you create a strategy to get the committee to approve your choice.” Then evaluate what each committee member needs to agree and deliver that customized information to each committee member before the meeting.

Look for ways to create commitment and you’ll be CompetitionProof.

 

How to Sell Against an Entrenched Competitor

When you sell into an established market, if you’re going to grow your share, you’ll have to take business away from your competitor. Dislodging an entrenched vendor isn’t easy, but it is possible and I’m going to show you how!

Try these tactics next time you hear, “We’re happy with our current vendor, thank you.”

1. Don’t Slash Price

When stealing business, many sales people are tempted to slash price. “I’ll beat whatever price that you’re paying and guarantee the quality, too!” they’ll boast. If you have spare margin to cut your prices below your competitor’s, you’ll be able to take some business, but it’s not a sustainable business model. Besides, the competitor probably will retaliate and if you’re going to keep the business, margins will get even thinner. Deliver new value instead of cutting your price.

2. Keep ‘em Honest

Ask your prospect, “When was the last time you went out for a competitive bid? Top negotiators strongly recommend that you get other bids at least every six months to keep your vendors honest. Let me help you keep an eye on the market by allowing me to quote your business at least twice a year. Worst case, you’ll have a better handle on the market. Best case, you’ll get a better deal.”

3. Spare Tire

Say, “Let me ask you a question. Does your car have a spare tire? You have four perfectly good tires that keep you going, so why do you need a spare? Because you might need it! And you’ll probably need it when you’re short on time and need to get somewhere fast. Well, let me be your spare tire. What would happen if for some reason, your vendor misses a delivery, delivers short, or has a blowout? Well, call me and I’ll back you up. Will you agree to that?” And then request an evaluation or certification so that you’re poised when the entrenched vendor slips.

4. What Do They Do Well? What Do You Want to Change?

Try this proven tactic next time you hear, “We’re not looking for any more vendors.”

Say, “Great! I’m so glad that they do everything that you need to your complete satisfaction. I’m always working to improve how I serve my customers. Please tell me, what do you like best about them?”

I know, it might be difficult to say the first time. But, try it, and really mean it! You’ll be delighted at how candid your prospect will be if you ask with honesty. Keep asking, “What else do you like about them?” until they run out of kind things to say.

Your prospect just gave you a list of their criteria for selecting a vendor. You’ll have to deliver on all of these points, and then some, if you’re going to get a shot at the business. Don’t start selling yet. You have a couple more questions to ask first.

Next ask, “What do you like least about them?” With this question you’ll get the criteria that you need to dislodge that vendor. You’ll find the cracks in their armor that they probably aren’t even aware of! Keep asking, “What else?” until they run out.

Then ask, “If you could have things any way you wanted, what would you change?” These are the good reasons for the prospect to switch.

And finally ask, “What would motivate you to change?” And now you’ll discover exactly what you need to do to get them to pull the switch.

With all of this information, you’ll be able to present a compelling reason to give you a go. “Based on what you’ve told me, you owe it to yourself to give us a try. At the worst case, you’ll have a validated second source. Best case, you’ll get everything on your wish list. When can we start an evaluation?”

5. Second Source

Or tell them, “Great! Then you’ll need a second source, just in case.” Pull out your business card and write, Second Source. Hand it to them and say, “Just put that behind their card in your card file. If they slip up, can’t help you the way you need to be helped, or if their performance slides, call me.”

6. Would You Like to Know How We’re Different?

Most companies believe they know why they are different or better, and they believe that their prospects and customers know why they’re unique and superior. It’s a sad fact: frequently, neither of these beliefs are true.

When you hear, “We’re happy with our current vendor,” say, “Great! Would you like to know how we’re different?”

Why You Don’t Want to Lead with the Claim That You’re Better

Notice that you don’t tell them that you’re “better.” Not yet! Better is a personal judgment. Don’t claim that you’re better until you know their criteria for what constitutes better. For example, a fast-food restaurant may be better if you want food in a hurry. A fine-dining restaurant may be superior if you’re celebrating a special occasion.

If your unique points are meaningful, they you’ll be perceived as better than the competition. If they aren’t, then asserting that you’re better destroys credibility because in the prospect’s mind, you are making a false claim.

Identify how you’re different and then determine if those differences mean anything to your prospects. And here’s how you can do that.

7. Your Top Ten Differences List

Prepare a list of ten ways that you’re different than your competitors and share this with your prospects. Your differences must meet the following criteria to persuade your prospect:

The differences must be relevant to yor prospect. If they don’t care, it’s not a point of difference. 

The differences must be specific. Use exact figures because the more precise the number, the more convincing it becomes.

The differences must be credible and believable. Don’t quote numbers that no one will believe. I frequently see this claim; “We can increase your productivity by 53 percent.” Saying that to a prospect is telling them they’re stupid. You’re telling them that they don’t know their business and you, an outsider, does. Stick to a number that’s smaller and more believable, even when you can deliver those outrageous figures.

The differences must be provable. Back up your claim with testimonial letters, case studies, and reference accounts.

The differences must be demonstrable. Do this with ROI worksheets, analysis and assessment tools, and demonstrations.

The differences must be real differences. Avoid the “Cheaper and Better” claims unless you can bring to bear strong evidence. You’re better off claiming “Value and Reliability.”

When your prospect agrees to examine your differences, hand them the list. As you review each point, ask if it is important to them. If so, check-mark it. At the end of the list, count up the check marks and ask, “Are these enough reasons to explore us as a second source?” If they say, “Yes!” begin the evaluation process.

If they say “No,” thank them for their time and leave. Then occasionally send your prospect reminders and proof of the points of difference they found useful and wait for the entrenched vendor to fumble the ball.

8. Don’t Convince Them, Make Them a Hero

If you attempt to convince your prospect, you’re going against the grain of their normal behavior. To be convinced, your prospect will have to admit that they were wrong. And you know that prospects hate doing that.

Your prospect may view switching as an admission that they had the wrong vendor in the first place. Not a politically correct action. So if you’re going to get them to switch, it’s got to be more than helping them save face; you’ve got to make them a hero.

9. Upgrade Them

Take the position that choosing you upgrades their strategy. Before you present your arguments on why you’re a better choice, say, “You know that as time goes by, companies make improvements in every area of their business. They upgrade software, improve productivity, and decrease costs. That’s progress and it keeps you competitive. You make improvements by changing processes and procedures. Usually, that means making an investment, whether it’s money or time. And part of that investment in change is upgrading vendors and suppliers. Would you like to know why our customers choose us as part of their upgrading process?” 

10. “Why Don’t You Give it a Try?”

After presenting your points of difference, say, “Why don’t you give it a try?” This is an easy way of letting prospects check you out without making a commitment. And right now, they aren’t ready for a commitment to you. Of course, you’ll under-promise and over-deliver, making the switch easy to defend to their management.

11. Make the Trial Confidential

They may be worried that talking with you may damage the relationship they’ve worked hard to establish with their current supplier. So offer to keep the trial period confidential so that they won’t risk any exposure. Just sign a mutual non-disclosure agreement and keep your mouth shut until you’ve earned the business.

12. “You Can Always Change Your Mind”

If they’re still reluctant, say, “You know that you can always change your mind. But try it before you decide. You can’t make progress without trying new things.”

How have you penetrated new accounts? I’d enjoy hearing your tactics.

 

How to Steal Competitors’ Customers for the Price of Breakfast

When budgets get frozen many sales people stop calling customers who have put their purchasing decisions on hold. After all, when there’s no budget there’s nothing to sell, so why make a sales call? In addition, customers are reluctant to be taken to lunch when then have no opportunity to return the favor by placing an order.

But the secret to long-term success lies in being the trusted advisor—the go-to person—for your current and future customers. Although most sales pros know this, few know how to effectively accomplish it.

Here’s the problem: 

How can you remain a trusted advisor to your customers when you aren’t talking with them? You can’t. If you want customers to buy from you when they DO get budget, you must stay in touch and offer value now.

Here’s the two-part opportunity: 

First, cement your current relationships to keep your competitors out of your accounts; and second, begin the process of becoming the trusted advisor for your competitors’ customers. If your competitors are ignoring their customers, it may be easier than you think.

Now is the time to call everybody on your prospect and customer list. If your business is slow, you should have plenty of time to make these quick calls. And you most likely won’t have much competition.

Here’s a sample script to start the conversation:

“I know you don’t have budget right now. But I also know that’s not a permanent situation because you still have your job. (Pause) So let’s have a conversation about your future plans, after all, I’m here to offer advice and help you plan for the future. So let’s meet for breakfast this week. I want to show you what’s coming, so that when you do have budget, you’ll be ready to get the edge over your competition. What morning works for you?”

Breakfast makes the best time for meetings because everybody appreciates a free breakfast and it’s the cheapest meal you can buy. Most customers will accept a breakfast meeting even when they would be reluctant to meet you for lunch.

If you schedule correctly, you can have two breakfast meetings every morning, giving you 10 face-to-face calls a week that your competition may be ignoring. (A note of caution, if you’re eating 10 bacon and eggs breakfasts, you’ll have to schedule extra time for your workout.)

In the meeting, instead of pitching your product, ask these four questions.

1) “When do you think your situation is going to turn around?” This question identifies the people you need to track. If they think things will get better soon, they are more likely to buy than someone who’s afraid to spend.

2) “What’s the next step in moving towards your vision for your company?” This identifies their next logical purchase. If you can help them take that step, this is a warm prospect.

3) “Where do you think the funding will come from to do that?” If funding is coming, you’re getting hotter. If not, perhaps you can help with leasing, trade-in allowances, or budget reallocation from operational savings.

4) “What can I do to help?” This is the ultimate sales close because it doesn’t sound like one. You’ll be surprised and delighted with the answers you get.

Now you can talk about your offerings in the context of helping them get to where they want to go. Voila, instant trusted advisor. When their budgets return, these customers will now come to you instead of your competitors—all for the price of breakfast.

Now you’re CompetitionProof!