How do you measure sales success?
Is it all about making quota or is it about having customers that like to work with you? If you were to judge by the way that most sales people are managed, goaled and rewarded, you would say that the only thing that matters is the achievement of quota. What you measure is what you get! So it is little wonder that many companies find it very hard to manage the difficult dichotomy between making the sales number and maintaining happy and delighted customers.
Do your customers need to like you?
There are many businesses that might focus on delighting the customer, and use ‘customer sat’ as a key measure of success. But customers can be very happy and not buy anything. That doesn’t enable sales success does it? Of course the reality is that both are important. But there’s the conundrum. How does a sales leader manage the joint goals of sales quota and customer satisfaction? On the positive side we can see that happy, delighted customers are more likely to be loyal, and thereby more likely to be returning, to be repeat-buy customers. Happy customers will be more likely to provide good references and even introductions to potential prospects. But do happy customers actually ‘like’ the vendor sales people? Presumably they grew to trust them, otherwise they would not have bought from them, but do they need to like them?
The importance of trust
“TRUST – LIKE – DO THE JOB” these are the 3 key tests of any partnership and a buy/sell
partnership is no different. Customers must trust the vendor. They must like the vendor (meaning their people, especially the sales people). And the vendor must be able to do the job that they promised to do
when they sold their solution. The problem for sales teams is that in an increasingly competitive marketplace there are many, many different providers who are actually perfectly capable of ‘doing the job’. Providing the solution just gets you a seat at the table.
How customers decide to buy
Customers make buying decisions based on the sales team and the service, support, implementation team that they feel they can trust and the one that they feel they will actually enjoy working with.
If you are selling a complex solution, or a solution which will involve a long-term vendor/customer relationship, being ‘liked’ is as important as providing a win-win solution. You’re going to be in this together for the long-term. It’s not enough just to be able to say you made quota this year when you made the sale if you lose all the other sales in the future. Or is it?
The answer probably lies in whether you work for a company or a manager who only cares about the quarterly numbers, or one with an eye on long-term, sustainable success.
The importance of customer satisfaction
With so many companies changing their typical go-to-market model to focus more on ‘software-as-a-service’ and other similar service-based delivery models, it will become increasingly important to measure, motivate and incentivize sales teams to deliver long-term customer-satisfaction, not just short-term business results. Many sales teams are ill-equipped to be successful in this new market because they have spent their entire careers chasing the monthly or quarterly target with little regard to the next 2-3 years.
It’s no wonder that so many companies are focused on trying to improve the consultative selling skills of their sales teams.
Read any book, article or blog about sales and you’ll probably come across some reference to the need for the sales person to provide value to the customer. But the real question should be “how can a sales person make their value more visible to the customer?”
Sales people who differentiate their value succeed
Most sales people work for a company where they have developed solutions which can add value to the customer’s business. The challenge is to persuade the customer that the value that one company (or sales person) provides is greater than the value presented by their competition. In many cases it is not the ‘best company’ or ‘best solution’ that wins the sale but rather the sales person who was able to make their value more visible to the customer. You’ll often hear people say that company 'A' was simply “out-sold” by company 'B'. What they really mean is that the sales person in company 'B' did a better job of making their differentiated value more visible to the customer.
How sales people make value visible
It’s no use having the best solution for the customer if you can’t make that value visible. So how can sales people make value visible? The starting point has to be to focus on the customer first, not on your product or service. This may appear counter-intuitive but the problem is that most sales people think that the value proposition is all about themselves and their product. It’s not; the value proposition
should be all about the customer and what your product or solution can do for the customer. Therefore, the sales person who can articulate the value that their solution can provide to the customer is more likely to win the deal.
Understand the value the customer is looking for
In complex sales scenarios (where there is more than one person involved in making the buying decision) this is even more important. This is because the sales person has to determine what type of value each individual member of the customer’s buying team is looking for, and then make that value visible to them personally. If they succeed in doing this they are more likely to win the support of all involved.
For example, let’s say that one sales person believes that part of their value proposition is that they are the market leader in their space. What does that mean to the customer? What is the value to the customer of this vendor being the market leader? The answer depends on who the sales person is addressing in the customer: for the CFO, or financial buyer, it might mean financial stability, the fact that the company is likely to be here for the long-term. For someone in marketing perhaps it has to do with brand and market perception. They want to be seen to business with a successful company. For someone in the implementation team perhaps it has more to do with experience and having a trusted, tried and tested solution. For others it might represent the potential economic value of being able to buy a solution at a fair price because the vendor has better economies of scale.
Sales people tell customers engaging stories to articulate their value
The key task for any sales person is to determine what their differentiating value is, and to find a way to make it more visible to the customer. One of the most effective ways of doing that is for the sales person to have a story to back-up any claim or value proposition. People remember stories. They re-tell stories. Customers are far more likely to remember a story which provides a good example of the value that the vendor provides. Good stories, customer success stories, references and market innovations help the customer to see and appreciate the real value that the vendor can bring to them. People will buy from sales people they trust – and sales people who are able to bring their value to life, to make their value visible by telling meaningful success stories.
When we teach people about consultative selling, adopting a consultative sales approach, what exactly do they need to do? We believe that becoming a consultative sales person requires becoming more proactive and developing a new mindset. A mindset which is different from the traditional transactional focus.
Transactional salespeople focus on the transaction, on making the sale. They focus on what they have to sell, their products and services and how these might be able to benefit the customer. The focus is on closing the deal; and therefore it tends to be short term.
Truly consultative selling requires a new mindset, a different approach, a change in the way we are seen by the customer. A consultative sales person wants to be viewed by the customer as being an expert, as someone who is focusing on them, and on their clients too i.e. the customer's customer. Consultative sales people focus not simply on winning the deal but on helping the customer to win. This requires developing a more long-term focus. Clearly the objective is to still win the business, but at the same time a consultative sales person wants their customer to win too – so more business can be developed with their customer in the future.
Developing a new mind set
This new mindset is fundamentally about being more proactive and less reactive in the sales approach. Reactive, transactional sales people respond to customer needs and react to customer demand. Proactive sales consultants look for ideas and opportunities to help the customer to win in their market.
Consultative sales people understand that customers value insight
Research conducted by Huthwaite research reinforced this point; thousands of senior executives said they would be willing to meet with a sales person who was proactive and could deliver real value and insight. These executives said they would be happy to meet with a sales person who could do the following:
1. Identify unrecognized opportunities
By this they meant they wanted ideas, proactive ideas about new opportunities, opportunities ‘that they had not recognized themselves’. In other words, the value to the senior executive wasn't from the sales person’s products or services but from their potential insight, being able to suggest and discuss new ideas and opportunities which the senior executive had not yet considered and
helping to identify a new business opportunity.
2. Find solutions to problems
Senior executives also said they would talk to sales people who could help them to find a new solution to an existing business problem, which they were struggling to resolve. They thought that the sales person might be aware of a solution from talking to other customers. Again the belief was that the sales person could bring insight from outside the company.
3. Highlight future business problems
The third area was perhaps the more challenging for sales people. Senior executives said they would meet with sales people who could highlight a future business problem which they might not have realized was coming. Again, the sales person's value is in their insight and expertise, because they are out in the market, they are aware of what’s happening; observing trends, being proactive.
The insight and value of a consultative sales person
The value a consultative sales person provides comes from their expertise and insight, not just from their products and services. It comes from their ability to identify new opportunities, to find new solutions and to identify future business problems. A consultative sales person's value is in their proactivity and in being able to articulate these to the customer - this is the approach and mindset we advocate for consultative selling.
Why is thorough call preparation of such critical importance? Haven’t you already spent enough time in research through the process of reaching out to prospective customers and getting the appointment? The customer has agreed to see you, so must be interested in what you have to sell, surely all you need to do next is to prepare a succinct presentation articulating the benefits and features of what you have to offer to convince the customer to buy from you?
This is not the thought process of the consultative sales person. A consultative sales person isn’t aiming to just make a ‘one time’ sale but to position themselves as someone that understands their customer’s needs, someone to be trusted, someone that the customer can turn to for solutions to their problems. Good call preparation is a key component in building this partnership relationship. (See ‘How to develop a successful sales relationship’) Consultative selling starts with thorough preparation, a preliminary analysis of the customer’s market position and what is happening internally within the company itself.
Understanding the customer's market position
This means determining the customer’s areas of business stress and what their future goals might be; understanding who their customers are and what they expect from them. It includes looking at their competition and why they might be more successful; a review of their channel strategy and how it operates; their competency and utilization of technology; considering their regulatory environment, the economy and how trends and groups like banks, unions and business analysts might impact their business.
Understanding the customer's company
This is about understanding the customer’s company’s key priorities and business issues, researching their organizational structure and business strategy. Do their people have the required skills and systems, to do what it is needed? What is their company structure, is it well aligned to their strategy, what is their corporate culture, their values, are they innovative and likely to be responsive new ideas?
Where to source this information
Web Research is the most obvious source, the customer’s website and also their competition’s which often includes useful information in annual reports and brochures. Look at the press, industry pages relating to their specialty, industry periodicals and the financial press. Consider reference sources like Yahoo finance, Google and Hoover's, business analyst’s reports, credit status reports and ‘Hold, Buy or Sell’ recommendations.
There are several sales apps available to help keep you updated on industry news, competitors in addition to the achievements, projects and thoughts of people you follow, take a look at apps like Cloze and Newsle.
Never forget the importance of talking to people, both in your internal team and in the customer’s external network. Allies in your customer’s company are an essential way of supporting and adding to your research. Also talk to the customer; customers love to talk about their business and if they detect your interest they will more likely share information with you.