Archive for June, 2009
Everybody sells. Even your hourly paid janitor or security guard. Whenever they’re seen or approached by a prospect or customer, they’re selling your company.
Think about those 1,000s of interactions every day. And each one has the potential to gain you new business -or- send customers fleeing to your competitors.
Here’s a story that got me thinking about a practical way for you to add 10s, 100s, or 1,000s of salespeople, for free. Read on.
Story of a Lost Sale & Brand Erosion
The following story is true.
A prospect visited a 5-star hotel/resort in Arizona. Her friend had told her about a very romantic casitas (special suite) that she must stay in if she had the opportunity.
The prospect was given a tour of the hotel and saw the particular casitas her friend mentioned. It was true, it was romantic, it was special. She wanted it for her birthday holiday 6 months later in the year.
A week later she called to reserve the casitas. The desk clerk told her the hotel’s policy did not allow reserving a specific room. The hotel assigned rooms, not the guests.
The prospective guest was surprised, this being a 5-star hotel. She asked what was the purpose of the policy.The clerk didn’t know.
The prospect then offered to pay the entire 5-day stay in advance, $2,450 upfront, right at that moment. Still the clerk referred to the policy saying that wasn’t possible.
The prospect told the clerk she’d checked out the hotel to stay in a specific casitas recommended by a friend. And that she wouldn’t be happy staying in just any room. Her heart was set on that casitas. The clerk politely reiterated the policy.
As you can guess, the prospect hung up frustrated and angry, and without a reservation. The hotel lost a $2,450 sale, and much more.
That prospective guest, now an unhappy non-customer of the hotel wasn’t silent. That’s normal. She definitely decided never go there in the future. And she began telling her friends not to go to there. The number of potentially lost sales grew.
Back at the hotel, the desk clerk correctly followed the hotel policy, he did everything right. He was polite, attentive, used all the proper phone etiquette, except he…
…didn’t understand why the policy existed, therefore couldn’t share that with the prospective guest
…wasn’t empowered by the hotel to improvise in a unique situation
…didn’t realize his brief phone interaction lost the hotel a lot of money and reputation, and if the hotel’s business worsened, eventually it would not have a job for him
…acted like an hourly employee, rather than someone who helps keep his own job
Lessons from the Story
This got me thinking about sales and facility service contractors.
All those hourly employees of contractors have many interactions with prospective customers (think about the visitors to your customers’ sites and word of mouth)
Hourly employees, whether they’re planned to deal with prospects or not, do sell your company.
Why not train them to help your company’s sales and health? Rather than hurt it like the desk clerk in the 5-star hotel.
Here are some brief ideas on how to do that.
How to Add 100s of Salespeople for Free
1) Create a Sales Referral Program
This can be relatively simple or complex. The key is for transparency, integrity, reliability and speed.
Your program should only pay out after a referred prospect is a customer and their first check is received. You only pay your referrer if you’ve been paid, a cash neutral proposition.
It must be clear to everyone involved how things work, what needs to happen for money to be paid. This means a well documented plan that’s presented to all employees (hey, it’s a big deal).
It must be fair for all, and rigidly managed to published procedures (no signs of favoritism or prejudice).
It must be reliable and fast. It works against you if the program takes 2 months to pass on a lead and sometimes gets dropped (you’re generating leads here, and motivating for more).
2) Add Brief Training on the Sales Referral Program
Add a 10-15 minute training for all new hires during their initial orientation.
You’ll also need to roll out the program to existing staff. This can be done in a combination of ways that may include:
- Payroll stuffers
- Supervisors presenting during break/lunch
- Managers presenting at all hands meetings on site
- On internal web site
- In employee newsletters
You may want to publish refresher notices every 6 months to keep the program on employees minds.
3) Training Content
The following is a first, quick take on possible content. There’s obviously a lot more needed. You’ll create your own to fit the specifics of what you want accomplished.
“When someone (prospect) asks you about your company, do the following:”
Look the prospect in the eyes and SMILE
Tell the prospect you’d be happy to have someone from SALES contact them if they’d like
Ask for the prospect’s business card (if they give you one, write their name on the back, make a copy if you like, and pass the card to your supervisor)
The supervisor will send it to your company’s SALES contact (NOTE: all this must happen reliably & quickly, no later than 36 hours from prospect to COMPANY to SALES calling prospect)
Give the prospect your company’s phone #
Give the prospect the name of your company’s SALES contact (you?)
Thank them for considering your company
You may want to include training that lets employees know that almost everyone is a prospect, or can influence a prospect.
Reality Check – Don’t Expect High Volumes
These prospects have just happened to make contact with your hourly staff on site, before going to your web site.
So it’s unlikely you’ll be getting 100s of new leads this way. But even one pays for itself.
Any and All Interactions with Prospects Matter
Remember, that first contact with your company is crucial. It doesn’t matter whether it’s with your janitor or guard -or- with you at your tradeshow booth. You’re setting the tone for all future customer expectations. And prospects are already assessing if they want to do business with your company.
What have you got to lose?
Your hourly staff are already on your payroll. You’re already paying for 10s, 100s or 1,000s of salespeople. Take advantage of that, for free.
~~~~~~~~~~~~~~
Chris Arlen
President
Revenue-IQ
June 26th, 2009
Cold calling has been seen as a good thing up to the ’80s and then seen as a bad thing in the 21st century.
Today, nothing strikes more dread and fear in salespeople as cold calling.
Yet business owners and sales managers see cold calling as an essential function for new business development on a budget.
Obviously cold calling means different things at different times to different people. So here’s a look at “cold calling’s” multiple personalities.
Cold Calling as Soul Destroyer
All salespeople will recognize this personality of cold calling. When doing the same thing over and over again, and not getting the desired results….well, it takes a part of you away.
And then some cold calling is worse than others, by far. The lowliest of the low are boiler rooms. Here’s a personal story. As a very young man between jobs (aka out of work) I answered an ad for telesales.
It was a boiler room. The job was to call up companies at random from yellow pages and get the lowly clerk who ordered printer cartridges on the line, and then work him or her over. The boiler room script had us imply we were their source of printer cartridges, and to get a re-order over the phone.
Well, of course we weren’t that company’s normal source. It was a spoof. But the numbers were such that occassionally some tired, disheartened, lowly clerk would actually place an order. And the boiler room did deliver printer cartridges as promised. But the sales was all based on a lie. On trickery. It was just plain sleazy.
I quit half-way through the first day. Didn’t get a commission. Didn’t even stop to pick up the minimum hourly wage. It was soul destroying.
Recent books, including “Never Cold Call Again” (it’s worth reading, but note: it requires cold calling in the beginning, funny huh?), use this cold calling personality to sell copies.
Obviously, if you’re cold calling without integrity, like in a boiler room, your soul withers up and dies. Not all cold calling is like that. But cold calling can have a dragging, depressing effect on the salesperson’s psyche. The numbers are painful, and that can wear you out.
Some times in sales you want to get prospects’ permission to be able to reach out to them via email over a long time period. Cold calling can be employed to help you get their permission.
Obviously this is different from direct mail where junk mail ends up in prospects’ post box. Who cares if prospects really wanted that post card or brochure?
Opt-In, Permission Marketing means prospects are allowing you to send them something of interest/value via email. If you’re buying a bunch of email addresses of unknown prospects and emailing them, well…you’re spamming. And that can eventually bounce you out of your Internet Service Provider (ISP). So, you’ll always want to have use Opt-In, Permission-based prospect lists.
The interesting thing about getting Opt-In Permission is that you need to reach prospects for the first time in order to get them to opt-in. And there lies the rub.
There are other ways than cold calling to gain Opt-Ins. For example, you can place banner ads, Pay Per Click (PPC) and pay other people to promote your request to add prospects to your Opt-In list. But those all cost money. And cold calling doesn’t cost anymore money than is already sunk into a sales person.
So cold calling in this case can be a legitimate and cost-effective way to gain Op-Ins.
Of course you have to have an incentive for prospects to sign up with you, but that’s for another time and blog post.
Cold Calling for “Right-Place, Right-Time” Opportunities
This personality is the reason cold calling still exists. If you call enough prospects, and are at least mediocre in sales talent, at some point you’re going to run into someone who really needs what your selling.
And if you’re selling a high-ticket item, that one sale is going to outweigh all the pain and suffering you’ve gone through to get it.
This is why owners and sales managers still believe in cold calling. That cry of “it’s a numbers game” has echoed through sales meetings since the beginning of time.
Cold Calling is a functioning disfunctional
All the above personalities are true for cold calling. And all at the same time. So when you decide to cold call, the “how your calling” and “what you’re trying to accomplish” impacts not only your results, but also how the salespeople feel about it. And that matters. Because who wants to slam their fingers in the drawer over and over again? It’s just something that won’t get done.
What other personalities do you have for cold calling?
~~~~~~~~~~~~~~
Chris Arlen
President
Revenue-IQ
June 20th, 2009
Yes, there is a secret. Yes, there is a #1 of secrets. Yes, it helps sell more contracts, and the larger ones at that.
Here’s the secret: it’s the difference between a cough and pneumonia.
This isn’t a question on an exam in med school. It is the sales secret for how successful salespeople connect service symptoms to the larger conditions of customers’ businesses.
Sales Symptoms and Conditions
A cough is a symptom. But does that cough mean you have a common cold, or pneumonia? Obviously one condition is minor, the other serious, potentially fatal.
By not being aware of the condition, whatever fix is proposed is likely to fail. The same is true for selling service contracts.
Symptoms = Service Issues
Let’s substitute symptoms for service issues, common ones are:
- Poorly trained contractor employees
- High turnover
- Poor quality
- Service mistakes & errors
Conditions = Business Impacts
For conditions, let’s substitute business impacts, common ones are:
- Customer’s employee productivity
- Total cost of ownership (of contracted services)
- Regulatory compliance (in or out)
- Brand equity (going up or down)
A Common Selling Trap
The trap most contractors fall into is they address the symptom when selling, but don’t dig enough to understand the larger impact on the condition of the business. Since they don’t know the condition, they can’t connect it to symptoms.
Salespeople are guilty of not showing customers how their service symptoms can have a serious impact on the health of their business.
In essence, offering Kleenex to a customer who has pneumonia.
Savvy & Successful Salespeople Know This
Truly successful salespeople uncover those larger conditions, and then show customers how their service symptoms are connected to business impacts.
Smart salespeople make the case for their customized service offering. They show how their service solves the issues (coughs) and either enhances or protects customers’ business (pneumonia-free health).
That’s compelling. That’s a proposition customers value. That’s a winning proposal, and a signed contract.
And business impacts are the real power behind winning more contracts.
Business Impacts Speak to Multiple Decision Makers
Your service impacts customers’ businesses in many critical areas. And customers’ decision makers are looking out for their own agendas.
When service issues are connected to business at a larger level, decision makers feel their agendas are at least being recognized.
Decision Makers: Roles & Agendas
Decision makers may come from different functional departments, but they all fall into common roles. Simplified here into a useful few:
- Gate Keeper
- Final Authority
- End-User
GATE KEEPER
The Gate Keeper’s role is to ensure their business areas are considered in the decision of contractors. Gate Keepers are represented by:
- Procurement, who’s there to mitigate risk from bad buying decisions
- HR, to ensure employment legalities are covered
- Safety & Environmental, to maintain contractor compliance with regulations & in-house programs
- Finance, to keep spend in line & ensure transparency
FINAL AUTHORITY
The Final Authority is the person who pulls the trigger on the decision. Their focus is how their decision impacts business results.
For example, they’re looking to see if the service contractor will help them:
- Lower costs
- Improve productivity
- Increase customer satisfaction
- Ensure regulatory compliance
- Strengthen brand equity: image & reputation
END-USER
This is the service contractor’s typical point of contact. The role that interacts with the winning contractor in the delivery of service.
During the decision process End-Users are focused on the viability of contractors’ offerings. To sort through smoke and mirrors and see what really works and what won’t. That’s why they are included in the decision making process.
As a result, contractors sell to this role almost exclusively.
And that’s a big mistake.
The End-Users’ agenda may align with the contractors solution, but it can still be torpedoed by another agenda, one that’s off the End-Users’ radar screen.
Just think back to bids where your End-User contact said you’d get the contract, but in the end you lost.
Even when the End-User is the only decision maker, they still have to justify their decision up the food chain.
To help them do that, savvy contractors show how their service solution addresses the agendas of the Final Authority and critical Gate Keepers, in addition to the End-User’s own agenda.
Addressing Multiple Agendas
Connecting service issues to business impacts speaks to the agendas of different decision makers. And this is where salespeople can win big.
When a contractor’s solution solves service issues and delivers positive business impacts, that’s the contractor that gets selected. Consensus among decision makers is a slam dunk.
Are you connecting service issues to business impacts?
~~~~~~
Chris Arlen
President, Revenue-IQ
June 12th, 2009
A current trend is for greater involvement by Procurement in service contracts of all sizes.
In the past Procurement had always run large bids. Now it seems they’re running many smaller ones too.
These smaller contract decisions used to be made by the business owner (customer’s manager) alone. Now, Procurement has their hands all over it.
For service contractors, Procurement is not the enemy. They just have a different purpose and agenda, so it’s worth taking a moment to consider their perspective.
Avoiding Negatives to the Organization
As an organizational gatekeeper, Procurement’s agenda is relatively simple – to mitigate risk from purchases.
It does this by avoiding:
- Disruptions in the supply chain
(think what would happen to a Boeing assembly line waiting on a supplier’s parts to arrive)
- Negative Public Relations from bad buying decisions
(such as a Wall Street Journal article pointing out a firm bought their logo’ed baseball caps from a supplier using child labor)
- Litigation from from a bad buy that caused injury, illness or death to customers or employees
(remember recent salmonella outbreaks from peanuts?)
At the end of the day, Procurement’s actions indicate one of it’s major goals is to produce Purchase Price Variance (PPV). In other words, pay a lower purchase price this time compared to the last purchase price. For more about the dark side on PPV, read Reversing into Darkness.
And in contract services we know that’s only part of the total cost of ownership (TCO). For more about TCO, read Contract Governance: The Movie.
Avoiding Negatives to Procurement
As the firm’s “buyer”, Procurement is also looking to protect its reputation inside the organization.
Not that it would be eliminated, but poor performance and lack of organizational confidence in Procurement can minimizes its budget, headcount and internal prestige.
As a department it has to justify its job too, just as marketing, safety and support services must.
This means part of the Procurement agenda is to avoid blame and finger-pointing from unhappy business owners who feel they they were stuck with a bad buy.
Adding Value to Buying
Procurement also seeks to add value from its existence. But in practice this contribution seems secondary to mitigating risk, and in some organizations is rarely seen.
Procurement adds value by:
- Imposing buying disciplines, which translates into consistently good purchases
(a common process is A.T. Kearney’s 7-Step Strategic Sourcing, here’s a link for Information Products but you’ll get the idea)
- Bringing negotiation expertise to lower purchase pricing
(service contractors may not like it, but this is one of Procurement’s roles)
- Selecting the best supplier to deliver a contract service
(in many instances this is Procurement lip-service to show a more politically correct face within its organization)
The Selling Part
There are two times when service contractors need to sell Procurement.
#1 Getting on the RFP bid list
#2 Participating in the RFP process
#1 Getting on the RFP bid list
Vetting potential service suppliers is only one of Procurement’s many responsibilities. They’re busy, and unless they’re looking for your service at the moment you’re not likely to get much of their time.
A strategy that came to light in the Procurement Talks: Interviews with Microsoft and Expedia was for service contractors to get the business owner to bring them to Procurement and make sure they’re (contractor) on the bid list.
According to the interviews, this seemed most successful when contractors were seen as experts by the business owner.
Procurement at both Microsoft and Expedia mentioned contractors being added to their bid lists because the business owner heard them speak at an industry trade show, seminar or training session.
That’s the recommended startegy: Become known as an expert in your service by speaking at tradeshows, holding seminars, etc.
And it won’t hurt to contact Procurement directly and respectfully follow their process for getting on bid lists.
#2 Participating in the RFP process
“No one ever got fired buying (fill in: IBM, Microsoft, etc.)”
Unless you are the IBM or Microsoft of your service, this is your initial struggle with Procurement.
Because their focus is mitigating risk (to their org & themselves) they’re not in a risk taking mood when selecting contractors.
But Procurement does value expertise. And they are looking for value and performance. They’re just a little more sceptical than many business owners.
Here are several strategies to use once you’re in an RFP process with the 800 pound Procurement gorilla:
- Present as many 3rd party certifications of your capabilities as you can (i.e. ISO 14001, Homeland Security SAFETY designation, etc.). Plaster them all over your proposal, make them conspicuous.
- Present quantitative benchmarking results from your business showing your improvements across customer businesses, and more specifically within the industry you’re bidding(it’d be wise to protect yourself with confidentiality clauses). Not only does this demonstrate your improvements, but it show Procurement your data-based and driven. And a good ally when Procurement needs to justify their decisions upstairs.
- Present case studies, ideally with the subject’s name and quantitative specifics in cost savings and value delivery spelled out. Again, the more concrete the better.
Obviously these aren’t all the strategies, but you can see they reference outside one’s own marketing claims.
If your job was to mitigate risk from bad buys, what proof would you look for in an RFP bid process?
~~~~~~
Chris Arlen
President, Revenue-IQ
June 1st, 2009
