Sales and Sales Management Blog

January 15, 2015

Guest Article: “The Most Underutililized Strategic Advantage,” by Lee Salz

Filed under: Closing Sales,sales,selling,small business,success — Paul McCord @ 2:15 pm
The Most Underutilized Strategic Advantage
By Lee B. Salz

You have been chasing this account for six months and feeling optimistic as the buying process is coming to a conclusion. The sale is between you and two other firms. The competition is fierce, but you feel you are ahead. At 11am, the Procurement Agent asks for three references to be provided to her by the end of the day. In a panic, you send a company-wide email in search of these referenceable clients. At 4:58pm, you get the three references from your colleagues and quickly send them out to the Procurement Agent. Whew! Mission accomplished! They wanted three references and you got it done. And so did everyone else. You see the finish line, forgetting that many a sales person has fallen one step short of winning.

This scenario plays out in companies every day across the country. It doesn’t matter if the company is big or small, nor does it matter the type of industry. The request for references is a standard part of any buying process. However, few sales people use the reference stage of the process to their strategic advantage. They simply desire to provide a quick response to the prospect with their requested references. In the mind of the sales person, the speed of the response communicates supplier performance. While somewhat true, the discussions the prospect will have with the references carries more weight in the selection decision than the speed of the response from the potential supplier.

When I talk to sales people, one of their most common gripes is that they are selling a product that is viewed as a commodity in the marketplace. They cite “price” as their biggest bugaboo. Right behind that they lament about their inability to differentiate their product. (The truth is that price and differentiation are directly related, but that is a topic for another article.) When I ask sales people if they would like to learn of an easy way to get a competitive edge, they are all ears. After I share with them that they have the ability to differentiate themselves through managing the reference selection process, they look at me in shock as they can’t believe they have been missing this opportunity. Then the stories start to come out. “Yeah, I lost a deal because they called the reference and we had just screwed up their order. I should have checked before I used them” The stories just continue from there.

But why do prospects ask for references? Webster’s defines “reference” as someone who can make a statement about a person’s qualifications, character, and dependability. Interestingly, there is a perception disconnect on references between sales people and prospects. When I talk to sales people, I usually hear that references are just a standard part of due diligence. Some use the term “rubber stamp” of an award. However, when I talk to buyers, I hear a very different message. Many buyers look at the reference step of the buying process as their opportunity to validate the message that they have been hearing from the potential supplier. In essence, prospects are searching to ascertain whether a supplier can deliver on the promises made during the buying process. Can the supplier really handle this size account? Are they really that fast? Or that accurate? Is the service as good as they described?

In many cases, the change of provider carries with it the ownership of the supplier’s performance. If the new supplier does not perform to the expectations that have been represented, there is risk for those who selected it. Heads will roll! Sometimes, prospects ask the same questions of the reference that they asked of the sales person to see if there is a difference in response. Other times, they ask specific questions relative to their needs that may not have been shared with the sales person. For the prospect, this is their most critical evaluation step of a supplier’s expected performance.

It is the little things that winning sales people do that makes them winners. So, if all of the competing sales people are going to provide “good” references, can you provide the “best” references? You most certainly can! However, there is a process to do so as “best” is different for each prospect.”

The first step is a conversation with the Procurement Agent. “I received your request for references and I’m happy to provide them. So that I can provide you with the references that best support your initiative, what are you hoping to learn from our clients?” If you can gather that information from the Procurement Agent (don’t say it can’t be done until you try it), you have the roadmap to identifying references. Even if they can’t or won’t provide you with this information, you have at least shown that you care. And “care” can be the differentiator that pushes you across the finish line. All is not lost if you can’t get that information either.

Going forward by taking a step back, think about the account and what is important to them. Reflect on what was learned during the needs analysis discussions. Thinking about that, imagine a different approach to responding to the request for references. If they were concerned about implementation, you provide an account that your company recently implemented. Perhaps, the decision is being made by a CFO, and you provide a reference of a CFO from one of your clients that can speak to your performance. For the third reference, you provide a client that is purchasing the same amount of the same product. From the prospect’s perspective, how great is the opportunity to speak to three clients who can relate to their needs. They are able to gather the information they desire from someone with whom they share something in common. They feel confident in their ability to perform due diligence on their potential supplier. They can make an informed decision.

To take it a step further, imagine rather than simply sending the contact names and phone numbers to that Procurement Agent, you provide a brief narrative explaining to what each client was serving as a reference. How many sales people are doing that?

Still raising the bar, imagine contacting each of the three references and informing them that a call was coming their way to discuss your performance as a supplier. During that call, you share that this prospect is calling to discuss particular areas of the business. Thus, when the prospect calls the reference, the reference is expecting the call and is prepared for the conversation. What a great experience for your prospect and your client. Keep in mind, one great way to burn a relationship with a happy client is to surprise them with a reference phone call. No one likes to be blind-sided or unprepared. I’ve seen more than a few opportunities lost where the prospect cited the reference experience as the deciding factor. An unprepared reference reflects negatively on the supplier.

In a competitive marketplace, every opportunity that you have to demonstrate value to a prospect is critical. Leveraging the reference step of the process can give you just that little edge that pushes you over the top.

 

Lee B. Salz is a leading sales management strategist specializing in helping companies build scalable, high-performance sales organizations through hiring the right salespeople, effectively onboarding them, and aligning their sales activities with business objectives through process, metrics and compensation. He is the Founder and CEO of Sales Architects, Business Expert Webinars and The Revenue Accelerator. Lee can be reached at lsalz@SalesArchitects.net

January 14, 2015

The “Prospecting” Disease

During my three decades in the sales industry I’ve worked with, met, coached, and observed thousands of sellers from a multitude of industries.  They’ve been new and experienced, inside and outside sellers, big ticket and small, specialized products and services as well as common, commodity products, some very successful and a great many barely holding their own or failing.

Some have been hail fellow well met types, others have been shy introverts.  Some pound the phones, others pound the pavement.  Some are highly attuned to technology, others can barely turn their cell phone on.  Some like to hit the office or the road early, others prefer to work late, a few do both.

But with rare exceptions they all have one thing in common—they’re busy.

They’re all doing stuff.

And a great deal of the time when you ask them what they’re doing they tell you they’re prospecting.

They’re busy trying to find business.  They’re focused on getting a contract in the door and getting paid.

Some, not the majority by any means, are very successful.  Most are not.

So the natural question is what’s the difference?  Why are a few really good at finding prospects and brining in business and most aren’t?

Turns out that most of the time the answer is really pretty simple.

The successful sellers spend their time prospecting.

The majority are simply infected with the disease of “prospecting,” that is, the illusion that what they are doing is prospecting when in reality it is nothing more than busy work to keep them from having to do the tough work of actually prospecting.

These unsuccessful sellers can show lists of several hundred names and phone numbers they have spent hours and hours researching that they have on a call list—a few dozen will have check marks beside them, even fewer will be scratched through.  They can show stacks of fliers and letters they have mailed out.  They can produce a list of networking events they have attended over the past couple of months.  They can produce a passel of emails they have sent out.  They may even have their business card pinned to every corkboard in every restaurant, laundromat, and other business that has a board to display customer’s cards.

Certainly they’ve been busy; no doubt about that.  The problem is although they have been busy, they haven’t been prospecting.  Instead of prospecting, they’ve been “prospecting”—creating filers, writing letters and emails, attending non-qualified networking events, making a phone call here and there—and increasingly spending more and more time “connecting’ with prospects via social media, tweeting and updating their facebook page and searching LinkedIn for any warm body that might be a prospect to try to connect with.  They confuse preparatory and busy work for prospecting, with the actual activity of interacting with a qualified prospect.

Although they spend a great deal of time doing busy work, they spend very little time actually prospecting.  They “feel” they are always prospecting, but in reality they are always finding ways not to prospect by spending their time preparing to prospect.  They engage in a great deal of activity, but the activity isn’t the activity that will produce business; instead, it is the activity that makes them feel good, feel productive, allowing them to convince themselves that they are being extremely active.

We salespeople tend to focus on activity—after all, activity is what gets us in the door, gets us the business we must have in order to succeed.  But activity alone is fruitless.  Activity for activity’s sake is just as sure a way to failure as inactivity.

Prospecting isn’t preparation to prospect; it isn’t finding easy ways to feel like you’re getting your message out; and it isn’t simply being busy all of the time.  Prospecting is a very specific activity—connecting and interacting with qualified prospects.

If you cold call, that means being on the phone, not getting ready to get on the phone.  If you network, it means actually being in front of and meeting prospects or garnering introductions to prospects from referral partners, not researching events or even spending time at non-qualified events where you’ll meet few, if any, prospects, or spending your time at the event hanging with friends and co-workers.

Investing time and energy in the wrong activities has killed as many sales careers as inactivity has.

As salespeople we have three very basic duties—finding and connecting with quality prospects, working with those prospects to help them satisfy needs or wants, and insuring that they are taken care of during and after the sale. 

Everything else is busy work and busy work doesn’t make a sale, doesn’t generate income, and doesn’t move us toward our sales or income goals.

Before you engage in any activity consider whether that activity is income producing or not.  If it isn’t directly producing income, does it really need to be done?  If not, move on to an activity that will directly lead to a sale.

To succeed you need to spend your time prospecting.  Getting infected with the “prospecting” disease where you “feel” you’re prospecting but in reality are finding ways to keep from having to prospect is a career killer.

January 12, 2015

Take Action Now to Create the Success You Want this Year

Are you in control of your sales career or are you simply going with the flow hoping that you’ll end up somewhere on the plus side?

If you haven’t done so already, here are some things you need to do now to insure that this year is the year you not only meet your annual goals but that you exceed them–that, if fact, you blow them completely away.

1. Flush out all of the tail chasing “prospects” in your system.
We all have “prospects” in our pipeline that take up time and energy but that we know in our hearts will never buy. Get them out of your system now. Don’t spend any more of your precious time on them. Concentrate on real prospects not  the “hope someday.” Vow not to spend any more time chasing your tail.

2. Get organized.
Most of us spend as much or more time “organizing” each day as we do working. Take a day or two and get yourself organized and then 30 minutes each evening getting ready for the next day. Don’t waste half the year “getting ready” to sell.

3. Know who a real prospect is.
If you haven’t already defined your ideal prospect(s) in detail, do so now.  Many waste a great deal of time chasing unqualified prospects because they haven’t taken the time to define for themselves exactly who their real prospects are.

4. Focus only on real prospects.
Even many who have defined in-detail who their real prospects are find themselves chasing after those who don’t qualify.  Commit yourself to staying on track.  Defining your prospect doesn’t do any good if you allow yourself to wander.

5. Eliminate the success killing busy work.
If what you do isn’t directly involved with finding qualified prospects, making sales presentations and closing sales, or getting a sale completed its busy work.  Busy work may make you feel like you’re accomplishing something but it isn’t making you a dime. If it doesn’t make you money, don’t do it.

6. Learn to generate referrals.
Referrals are the best, most cost effective prospecting and marketing method there is. Nothing can beat referrals in terms of ROI, close ratio, and client loyalty.  Yet, few salespeople generate many quality referrals.  Less than 15% of all salespeople generate enough quality referrals to impact their business.  Learn the process that really generates a large number of high quality referrals and turn your clients into your marketing platform.

7. Create a consistent client communication campaign.
If you don’t already have a consistent communication campaign for your clients and prospects, create one now.  You should be touching each of your clients and long-term prospects 12 to 16 times a year.  Use a combination of media–calls, emails, newsletters, letters, postcards.  Make sure each of your communications brings value to your client.  The key question to ask yourself before making any contact is “does this benefit the client or only me?”  If it doesn’t benefit the client, don’t send it or don’t call. Never waste your client’s time.

You have a choice–you can either take control of your time, energy, and sales business or you can go from crisis to crisis putting out fires while desperately trying to get a sale here and another there.

Life’s a whole lot better when you’re in control than when you’re at the mercy of chance dictates.

January 8, 2015

3 Steps to Getting High Quality Referrals From Your Clients

Are you one of the majority of sellers that isn’t converting the majority of the referrals you get because the “referral” is nothing more than the name and phone number of someone who isn’t a real prospect?  Are you one of the sellers who have simply given up even asking for referrals because they have proven to be more of a waste of time than anything else?   Chances are you said yes because that’s the experience of most sellers–weak or worthless “referrals” that cost more time and waste more energy than they’re worth.  Oh, sure, we all have some clients that will give us referrals all day long.  Just ask and they’ll give you name after name.  Other clients, the majority, aren’t nearly as generous with their referrals.

The biggest problem in both cases is so often the referral we get isn’t much better than pointing at a name in the phonebook at random.

How can you guarantee that you get great referrals?  Simple.  Make sure the client gives you a great referral by creating the referral for them to give you, rather than relying on them coming up with a quality referral to give.

The reality is that clients really don’t know who we’re looking for and most of them just don’t have a real incentive to invest the time and energy to come up with a great referral.

But we know who is a great referral for us.  And certainly we’re willing to invest the time and energy to find a great referral (if we’re not, we have some real serious issues to deal with).

Since we’re the one with the need; and we’re the one with the desire; and we’re the one who knows who makes a good referral for us, why would we rely on anyone else other than our self to come up with the referral?

So how can we create a great referral for our client to give us?

Here are three steps to guaranteeing you get great referrals from your clients:

  1. Get Your Client On-board to Give Referrals.  Most sellers wait until after the sale has been completed before they bring up the idea of referrals.  Bad idea.

    Most clients need time to get comfortable with the idea of giving referrals, so bring up referrals early in the relationship.  Don’t ask for referrals; just let your client know that your business is built on referrals and then drop referral seeds as the sale progresses.  Since your prospects and clients aren’t stupid, if they hear you mention referrals often in a casual manner, they’ll get the impression referrals are important to you and they will be expecting you to ask for them at some point.

  2. Find Out Who Your Client Knows.  We’ve already established that in order to get great referrals you have to do the work for your client, so do it by discovering during the course of the relationship who they know that you know you want to be referred to.How do you find out? Through small-talk (who do they mention in conversation they know); paying attention to what’s in their environment (pictures, association directories, membership plaques, and such); their background (where did they work previously); their work (what vendors and suppliers do they interact with).  Your job is to be a detective and to uncover the relationships they have with people or companies that you know you want to be referred to.  The more you uncover the more quality referrals you uncover.
  3. Don’t Ask for Referrals, Ask for THE Introduction.  Now when it comes time to ask for referrals, you’re not going to be like every other seller and ask a weak question such as, “Donna, do you happen to know anyone else (or another company) that might be able to use my products or services (or that I can help—or any other such weak question)?”

    Instead you’re going to ask for a direct introduction to someone you know is a great prospect for you and that you have reason to believe your client knows:  “Donna, I’ve been trying to connect with David Jones for some time without success.  You mentioned that you’ve worked with David for several years, would you be comfortable introducing me to him?”  You know she knows David.  You have reason to believe David is a good prospect for you.  Don’t waste Donna’s time with that weak general referral question; ask to get connected to a person you know she knows that you know you want to connect with.

Referrals can be the foundation of your sales business if you just develop the skills necessary to be a referral-based salesperson.  If Donna knows three people or companies you know you want to be referred to and you can get introductions to them from her, how much time and energy have you saved getting those three introductions through referrals instead of cold calling or sending out direct mail or hoping to bump into them at a networking event?

Forget what you’ve been taught about asking for referrals.  Referral generation is a PROACTIVE process where you do the work, not your client.  Your client doesn’t have the motivation, you do.  They don’t have the understanding of who makes a good referral like you do.  Your client doesn’t have the time to invest in figuring out a good referral like you do.  It’s your business, not theirs.

March 1, 2013

Book Review: Principled Selling: How to win more business without selling your soul

principled-selling-cover-191x300Ethics.

Honesty.

Integrity.

Principles. 

All of these terms are on the tip of virtually every seller’s tongue.  We sellers talk about them, we proclaim we exhibit them in our personal and professional life, and we bombard our prospects and clients with the claim that we epitomize them and they can, thus, trust us without reserve.

To a great extent prospects have heard these claims so often and so loudly that the integrity and ethics of salespeople are a running joke.  For many as soon as a seller says they can be trusted the prospect expects to get screwed.

To top it off many sellers work for companies that preach integrity and ethics and then turn around and practice the worst possible business practices.

Many sellers are working hard to be the ethical, disciplined seller they claim to be.

Nevertheless, the question can legitimately be asked if it is possible to sell with integrity.  Can we as sellers be principled and succeed or is selling by its very nature an endeavor that demands a bit of larceny, manipulation and deception?

David Tovey has addressed the issue in Principled Selling: How to win more business without selling your soul (Kogan Page:  2012).

Tovey argues that it is in fact possible—and not only possible but profitable—to with integrity than to sell using manipulation, deception, or by stretching the truth and trying to be all things to all people.

Principled Selling sets forth a comprehensive look at the sales process—both how it has been practiced in the past and how it should be practiced in today’s rapidly changing sales environment. 

The heart of Principled Selling is the five principles of selling:

Principle 1: selling is about motivation not manipulation

Principle 2: profitable relationships require investment

Principle 3: there must be congruency throughout the business development process

Principle 4: long-term relationships depend on being authentic

Principle 5: being human gets results

From those five principles Tovey constructs a process and shows in detail how to find and attract prospects and then turn them into clients. 

Unlike many books that start out and stay in the ivory tower of sales theory, Principled Selling gets down to the real world through the use of case studies and fleshing out the skills and attitudes necessary to successfully sell with full integrity.

If you’re struggling with how to become a fully transparent and ethical seller or if you’d simply like to learn more trust based skills, pick up a copy of Principled Selling—you really can sell more without selling your soul.

February 25, 2013

Building Your Business on Referrals Pt 3: You Don’t Need Referrals, You Need Introductions

How often as a B2B seller have you been advised to ask your client for referrals?  If your experience is typical then you’ve heard that advice just about every time you turn around.

Most of us have had it pounded into our heads that we need to ask for referrals after the sale has been completed. We just need to do a good job for our client and then, after the sale, ask them if they know of anyone who could benefit from our products or services and we’ll easily and rapidly grow our business.

Depending upon the seller you ask, that referral question can take many different forms, such as:

“Ms. Client, who do you know that could use my products or services?”

“Mr. Client, who do you know that I should be talking to?”

“Mr. Client, who else do you know that I could help?”

“Ms. Client, if you happen to run across anyone else that I might be able to help, would you give them one of my cards?”

But no matter the specific language of the question we’ve been taught to ask, almost all of them have the same root problem that results in our receiving few high quality referrals: all of the questions most of us have been taught to ask require our client to do our work for us.

In virtually every case we are asking our client to come up with the name of someone they know who they believe could use our services—even though our client really doesn’t know who is a really strong prospect for us; even though our client doesn’t know all of our capabilities; and we’ve put them on the spot asking them to come up with a great referral for us with only a few seconds to think about it.

Not surprisingly most of the “referrals” we get—usually nothing more than the name and phone number—prove to be no more qualified than if we had thrown darts at the phonebook and are, thus, nothing more than time wasters.  Certainly one here and there turns into a client—but for most of us the pickings are pretty slim.

So if asking your client for a referral to someone they know who might need your products or services doesn’t work very well, is it possible to get a large number of high quality referrals from clients?

Yes, absolutely it is.

But instead of asking a weak question like “who do you know that might be able to use my products or services,” it makes far more sense for us to do the hard work of finding out who our client can refer by figuring out who our client knows that we know is a great prospect for us and then asking for a direct introduction to that person.

This method demands more than simply popping off a question at the end of the sale trying to get your client to do your work, but it is powerful because:

  • You are making it so easy for your client to give a great referral that all they have to do is say “yes”
  • You have relieved your client of an uncomfortable and often unwanted burden
  • You are far more likely to get a positive response from your client because instead of asking them to rummage around their mental file cabinet trying to figure out who to refer, you’re asking for a specific and easy to fulfill action—an introduction to someone they know
  • The introduction you get will be to a quality prospect because it will be to a prospect that you pick and that you know you want to be introduced to
  • You will have a much greater chance of setting an appointment with the prospect by being personally introduced by your client than if you just get their name and phone number and call them out of the blue
  • Over time, you can get multiple high quality introductions from each client. They become a never ending source of quality referrals by simply asking for additional specific introductions as you earn them

By investing the time and effort to do the detective work necessary to discover who your client knows that you know you want to be referred to you are not only taking the burden off your client, you’re making it so easy for your client to give you a great referral that the only thing they have to do is say “yes” when you ask.

Instead of relying on your client to come up with a top referral you’re insuring that the introduction you receive is one that you want to receive.

The primary issue now becomes how to discover who your client knows that you know you want to be referred to.  That issue demands developing some detective talents such as keen observation, listening, and analytical skills—skills that will be covered in part 4 of this series on referrals.

In addition to being able to uncover great introductions that your client can give you, the question you ask naturally changes.  Instead of asking your client to come up with a name and phone number, your question will now be geared toward confirming that the client knows your intended prospect and then moves on to asking for the introduction.

Depending upon the circumstances the request could look very much like this:

You: “Don, I’ve been trying to reach Janet Smith over at XYZ Company for some time and haven’t been able to connect and it occurred to me that you might know her.  Do you know Janet?”  (Of course since you’ve done your homework you have good reason to believe he knows her.)

Client: “Sure, I know Janet. Why?”

You:  “Great.  Would you be comfortable introducing me to her?”

If you have done your job well and earned your client’s trust and respect, there is an extremely high probability your client will readily agree to introduce you to Janet.  Instead of asking your client to do your work for you all he has had to do was say “yes.”

Although this process is most easily implemented by B2B sellers, it also works well for B2C sellers in situations where the seller has the opportunity to know their client very well.

Rather than asking your client to rack their brain and do your prospecting for you—something they are ill prepared to do—take the time and put in the effort to do the work for your client and you’ll turn introductions from clients into a major source of your new business.

Referrals—rather direct introductions–can be the cornerstone of your sales business if you learn to do a little detective work and make it easy for your clients to give the great referrals you’ve always wanted.

February 21, 2013

Building Your Business on Referrals Pt. 2: Asking for Referrals is Bad Practice

OK, I know, you’ve been told your entire life as a salesperson that you have to ask for referrals and that if you don’t you’ll fail.  But if you’re like most sellers you’ve asked and on occasion get a name and phone number of someone that turns into a new client, but most of the time the names and numbers you get are about as targeted as taking a dart and throwing blindly at the phone book.

The above situation is so common that a great many sellers simply stop asking, thinking that referrals are nothing more than sales mythology, while others, thinking they are the cause of the failure to generate significant numbers of quality referrals, continue to ask with little success and a growing sense of frustration and failure.

The reality isn’t that generating quality referrals are nothing more than a myth or that the seller himself is the root cause of referral generation failure.

Referral generation fails primarily because of the way most sellers have been taught to seek referrals.  The seller isn’t the problem; the strategy they’ve been taught is at fault.

How have most of us been taught to get referrals? 

For the most part out referral training consists of nothing more than “do a good job for your client and ask for referrals with a question such as, ‘Mr. Prospect, do you know anyone else who I might be able to help as I’ve helped you,’ or ‘Ms. Prospect, do you know of anyone who might benefit from my products or services?’

Certainly on occasion the training may be a bit more in-depth—one trainer might encourage sellers to ask the question early in the sale while another stresses the need to ask only after the sale has been completed, or one trainer might use slightly different phraseology or might encourage the seller to ask for a specific number of referrals, but the essence of the training is the same—do a good job and ask for referrals.

The problem is the process taught causes more problems than it solves.

First, the good news—the traditional referral training solves a major problem—it encourages the seller to seek referrals.  Although the success ratio is typically very low, it does produce the occasional prospect that turns into a client. 

Now the bad news—it fritters away one of the most valuable business generation resources a seller has—the potential quality referrals from a satisfied client.

Let’s take a look at the primary problems the traditional referral “method” creates:

  • The Referral Question Comes Out of the Blue:  Most clients are not comfortable when put on the spot to give referrals.  When we ask for a referral we may be thinking that we’re asking a small favor but most clients take the request far more seriously.  When a client gives a referral they believe they are putting their reputation on the line, something most don’t do lightly.  Clients need time to become comfortable with the idea of giving referrals.  If we really want quality referrals, we have to allow our client the time to become comfortable with the idea of giving us referrals before we ask.
  • We Don’t Give Our Client the Opportunity to Give Quality Referrals:  When we follow the traditional training of “do a good job and ask for referrals” we literally stand in front of our client (or are holding on the phone) expecting them to pop off the names of great prospects for us.  We are asking them to go through their mental file cabinet and come up with great referrals in the course of 10 or 15 seconds.  That is simply an unrealistic expectation on our part and we usually get what we deserve when we put a client in that position—little to nothing of value.
  • Our Client Doesn’t Know Who a Great Prospect for Us Is:  Not only do we expect our client to be able to give great referrals just off the top of their head, we expect them to know exactly who we can help when much of the time our client hasn’t had the opportunity to fully appreciate what we’ve done for them, much less know what all of our capabilities are and who is really a top prospect for us.  We’re asking our client to do the impossible—know our business as well as we know it.
  • It Ignores Human Nature:  The traditional referral request is one-sided and offers the client no reason to give referrals.  There are, obviously, clients who will give referrals even when there is nothing in it for them, but human nature being what it is, the referral request can be far more successful if it can be shown that it benefits the client as well as the seller.
  • It Makes the Client do the Work:  Rather than making it easy for our clients to give us great referrals, we make it as difficult as possible by asking them to do something they are ill prepared–and often not inclined–to do.  Giving high quality referrals should be so easy for our client that literally all they have to do is say “yes.”

Although referral generation as traditionally taught is laden with self-defeating issues, referral generation when practiced properly can be a highly successful business generation tool—one that can literally be the cornerstone of a successful business.

February 19, 2013

Building Your Business on Referrals Part 1: Understanding the 4 Pillars of a Successful Referral

At first glance, a referral is a pretty simple thing.  For most sellers, managers, and trainers, a referral is just a name and phone number that a client has given once the seller has completed the sale, has done a good job for the client, and then asks a general question such as, “do you know of anyone else that I might be able to help?,” or, “do you know of anyone else that might benefit from my products and services?”.

Once a seller has received a referral, contacting the referred party is just as simple.  The seller will call the referred party mentioning to him or her that the client, which the prospect knows, referred the seller to them, or on occasion they will ask the client to write a referral letter to the prospect and then the seller will call the prospect after they have received the letter.  A very simple, straightforward process.

Unfortunately, this “do a good job and ask for a referral” process is totally and completely wrong, and has been proven by millions of sellers to not work worth a darn.  Nevertheless, this is what is taught in almost every sales course that mentions referrals.  And not only is it a waste of time and effort, it deceives the seller who don’t succeed when using it into believing that the fault lies with him or her, not with a “system” that doesn’t work.

Generating a large number of high quality referrals requires far more than “doing a good job and asking for a referral.”

If you want to generate a large number of high quality referrals from your clients, you must understand what creates a quality referral.

A high quality referral is built on a foundation that has four solid pillars—and as the seller; you have control over three of them:

  1. Your relationship with your client:  Most clients don’t give referrals because they like you or even because you did a good job.  Certainly there are a few clients that will give referrals at the drop of a hat, but most clients hate to give referrals and unless they have a deep trust that you will not embarrass them and that you’ll deal honestly and competently with the prospect they refer, they won’t be willing to give quality referrals.Most clients believe that when they give a referral they’re not just suggesting that someone they know speak to the person they are referring, they believe that they are endorsing the seller, in essence telling the person they refer to the seller that they don’t need to do any research because the referrer has already done it and this person they’re referring is the best choice.  To get clients to take this step doesn’t come without having built a strong bond of trust.
  2. Your client’s purchasing experience: Discover what your client’s purchasing expectations and priorities are, then meet and, hopefully, exceed them.Few sellers ever exceed their client’s expectations because even though they think they know what the client’s expectations are, they never really try to find out, they never ask.  You cannot afford to guess or “think” you know what your client’s expectations are–you must know exactly, and you can only do that by discussing them with your client and then making sure you meet or exceed them–nothing less will do.If you don’t specifically ask your client what their expectations are, the best you can do is meet or exceed what you think your client’s expectations should be.Clients assume that anyone they refer you to will have a similar or WORSE purchasing experience than they had.  The further away from their desired purchasing experience they have, the less likely they will be to give a quality referral.
  3. The relationship between your client and the prospect:  This is the one pillar you have no control over.  Clients will refer you to people they have very strong, positive relationships with–and people they have very negative relationships with.  If the prospect trusts and respects your client, some of that trust and respect will be automatically imbued to you and you start your relationship with them from a position of strength.  On the other hand, if the prospect distrusts or doesn’t respect your client, some of that distrust or disrespect will also be imbued to you and you will start your relationship with them from a position of weakness.  Your job is to find out exactly what the relationship between client and prospect is and then plan you introduction approach to them accordingly.
  4. Your initial contact with the prospect:  To this point you’ve invested a great deal time and effort in establishing your relationship with your client, making sure they have exactly the purchasing experience they want, and finding out what the relationship is between your client and the prospect they are referring.  After investing so much time and attention to get this far, the last thing you want is just a name and phone number.  Instead of getting a traditional “referral” consisting of the name and phone number of the prospect and permission to use your client’s name, get a direct introduction from your client to the prospect.There are three primary methods of getting a direct introduction:

    Letter of introduction from your client to the prospect:  Ask your client to write a letter introducing you to the prospect.  However, once you’ve asked your client to write the letter, let them know that you know how busy they are and then offer to take the burden off of them by writing the letter for their signature.  If you allow them to write the letter it won’t communicate a reason for the prospect to meet with you and it will be written on their schedule—which could be never.The letter you write should give a brief overview of what you’ve done for your client and why the client believes it would be beneficial for the prospect to meet with you, as well as the time and date to expect a call from you.  Have your client sign it. Phone the prospect at the exact time your client indicated you’d be calling.

    Introductory phone call from your client to the prospect:  An even stronger introduction is a phone call from your client to the prospect to introduce you.  This method puts additional pressure on the prospect to agree to set an appointment with you as it is difficult for the prospect to say “no” to your meeting request when they know that their friend, co-worker, or associate is standing next to you when you ask.The downside to a phone call is it gives the prospect the opportunity to ask questions of your client. If there were aspects to the sale that didn’t go well there is a good chance they will surface during the phone call.

    Lunch meeting with your client, the prospect, and yourself:  A tremendously strong introduction method.  Have your client invite the prospect to lunch or coffee with the three of you. Encourage your client to let the prospect know this is NOT a sales meeting, just an opportunity for the two of you to meet one another.

    One of the strange things that often happens during the meeting is the client ends up being your salesperson and you are there simply as the consultant.  And, again, it is very difficult for the prospect to say “no” when you request a meeting.

As seen above, you have control of the majority of the pillars upon which a referral is based.  If any of the above is weak, your likelihood of generating quality referrals will decline and the weakness must be made up elsewhere.  In actuality, if one of the first two segments is weak, you will not be getting quality referrals–period.  However, you can mitigate the third one by using a strong method of introduction.

Generating a large number of quality sales isn’t done by chance or luck, and neither is generating a large number of high quality referrals.   Just as you need a well thought out process to consistently sell, you need a well thought out process to generate quality referrals.  You can significantly increase the volume and the success of your referrals if you understand the dynamics that generate quality referrals and then control those dynamics.

February 8, 2013

You Have to Act the Part to Become the Part

Back in the days when Indians roamed the range, before leather helmets, when the Flying Wedge was all the rage, I played football in high school.  My high school team wasn’t all that great since I went to the new high school in town and the city fathers finagled it so that most of the good players went to the old, established school. 

We had a coach who would tell us that in order to become the player we wanted to be, we had to act the part to become the part—that is, we had to act like good football players in order to become good football players.

That small bit of advice has a tremendous amount of wisdom packed into it—and a lot of room for misinterpretation. 

First let me say what Coach didn’t mean—seems especially important in today’s culture.  Acting the part didn’t mean trash talking, acting like the school stud, or grandstanding.  He would never put up with someone putting on airs, demanding special treatment, or getting too big for their britches. 

Acting the part meant imitating the play of a quality player—doing those things that the good players do that make them good. 

Acting the part means forgetting that one might be relatively new or inexperienced or hasn’t mastered necessary skills

It means consciously forcing oneself to go through the same motions good players go through, using the same techniques and strategies, assuming the same confidence and self assurance (and faking it if necessary).

The philosophy behind Coach’s words is simply that you cannot become the person you want to be if you don’t do the things that person would do.

That small bit of advice works not only in sports but in all aspects of life, especially in selling.

Are you not the seller you want to be?  Are you new or haven’t produced in the past at the level you want?  Are you not one of the top sellers in your organization?  Are you not at the top of your industry?

You can be—but not unless you act the part of a top seller, doing the things top sellers do.

I have heard literally thousands of average or slightly above average—and especially below average–sellers claim that they want to sell their way rather than imitating the top people in their organization.  Some say they “can’t” sell the way the top sellers do, others that they know a better way.  Ultimately they all have the same thing in common—they never make it to the top level.

There are thousands who claim to be sales trainers and gurus, all ready and willing to give you the secrets of selling success for the right price.  And much of what they sell is really good and will help you increase your sales.  I’m not downplaying the role of a quality trainer—after all, I’m one. 

That being said, the quickest, surest way to becoming a top seller is to simply act like a top seller, doing the things a top seller does.  You’ll be surprised at how quickly the “act” becomes the reality.

 

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January 31, 2013

The Myth of the Nobility of Failure

I’m a failure.  I’ve had two failed businesses in the past.  I agonized over them.  I lost lots of money trying to build and eventually save them.  I lost sleep over them.  I lost self respect over them.  My failure hurt other people—people who worked for me or whose business my business helped support. 

I learned a great deal from those experiences—although my initial lessons learned were false lessons.

Friends, family, acquaintances, and business “gurus” assured me that my efforts to build something were quite noble and that I really hadn’t failed, I simply came up a bit short of my goal.

I was told that I should take pride in my effort as I was one of the few who had the courage to take the risk–and that itself was a magnificent reward.

I was told that failure wasn’t my fault—I was a victim of the marketplace, seeking to compete against a system that was stacked against the little guy where I could only succeed through luck.

I was told to shrug it off as simply a learning experience; that the only failure was failure to learn.

At the time, I bought into that BS.  Because I wanted to believe it.  Because I didn’t want to admit that I had failed. 

Because I wanted—needed—reassurance that I still had value, that I wasn’t worthless. 

Over time I came to realize a painful truth, one that to some extent is still a bit difficult to admit—I failed.

And there’s nothing noble about failing.

There’s no magnificent reward in failure.

I wasn’t a victim of the system—I failed because I didn’t do the right things.

My failure wasn’t someone else’s fault or the economy’s fault or the “man’s” fault or my employee’s fault.  It rested completely and totally on my shoulders.

While buying into all of the excuses provided me for failing, I believed I had learned a good deal from those failures.

It wasn’t until after I came to the realization that all of those supposed reasons for my failure were nothing other than feel good excuses did I really learn some valuable lessons from my failures.

Only after I was willing to take responsibility for what happened and recognize how I was the architect of my failure did I learn the real lessons to be learned.

We live in an era where there’s a great deal of excuse making for failure.  When you fail there are people everywhere willing to give you a reason why it wasn’t your fault.  In today’s culture—even our business culture—everyone is given the victim excuse.

When you fail—and you will, whether it be big or small—don’t allow yourself the luxury of being fooled by family, friends, and supposed gurus.  They’ll try to make you feel better by letting you off the hook.  It’s an attractive but deceptive lie.  It’s a lie that will prevent you from learning the real lessons to be learned from failure.  It’s a lie that will set you up for further failure.

Rather than falling for the kind lie, face up to the harsh truth of your responsibility for your failure. 

There is no nobility in failure.

You weren’t a victim of anything other than yourself.

Failure isn’t a reward in itself.

Yes, it’s much harder than the alternative.

The weight of that realization is far greater than when others try to lift the weight of failure through their lies.

But the lessons learned will serve you well—and most importantly, wage war against future failure.

 

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