As a manager, you have probably seen your sales and marketing representatives in the following scenario.
They're trying to convince a potential customer that your company's great products or services will solve the customer's most pressing problems. To prove the point, they explain precisely how their solution will work.
Mr. Potential Customer listens carefully, asks many questions and takes copious notes. Everything is running smoothly. The customer nods and says all the right things, and the rep leaves convinced that the sale is in the bag.
The problem is, when they call to close the sale, Mr. Potential Customer is nowhere to be found. Later, you hear from your rep that the customer has decided to buy from your top (and less expensive) competitor.
You've seen this play out dozens of times; frustrated, you ask yourself, “Where did this go wrong? Why didn't I see it coming?”
What really happened is that once again they've fallen prey to an all-too-common trap: unpaid consulting. This is another painful reminder of how these scenarios play out… unpredictable forecasts, lost sales and reduced margins.
Unpaid consulting starts when the rep crosses the line between diagnosing the problem and explaining the solution. When sales or marketing reps start designing solutions, they begin acting as unpaid consultants.
In past decades, this was not a monumental issue. Generally, there was limited competition in complex sales. If your reps figured out the problem and designed a unique and valuable solution for a customer, the sale was almost guaranteed and the rep was rewarded for his consulting effort.
Today, however, there is an ever-increasing proliferation of competitors in complex sales, and once a solution is designed the customer can easily shop it to the competition.
Why the change?
It is the outcome of the technology explosion in the past decade or so. Simply put, no matter how sophisticated your products and services, chances are that numerous competitors offer the same thing. And because geographic location is no longer a critical factor—due in large part to the advent of the Internet—a manufacturer in New York can easily access a supplier in Los Angeles (or China, for that matter) just as easily as it can the one across the street.
So what's a sales manager to do to help his/her sales force? In today's complex business arena, there are no simple solutions. What is required is a systemic approach to an environment characterized by long sales cycles, multiple decision makers and numerous perspectives that may cross national and cultural borders.
A system called Diagnostic Business Development provides a navigable path from the first step of identifying potential customers through the sale itself and on to expanding and retaining profitable customer relationships. These are the four phases in this system:
- Discover: The sales and marketing professional researches, prepares and sets the stage for a compelling engagement and a continuing relationship based on trust and respect.
- Diagnose: An in-depth determination of the existence, extent and financial impact of the customer's current situation is pursued. Diagnosis is meant to maximize customers' objective awareness of their dissatisfaction and determine whether that dissatisfaction corresponds to the salesperson's offerings.
- Design: The goal is to get the marketing professional and customer working together to identify the optimal solution to the problems that were uncovered and quantified in the Diagnose phase—even if it involves alternative solutions offered by competitors. This phase is the “dress rehearsal” before the final presentation is made. It is here that many salespeople make the mistake of giving away valuable information and becoming an unpaid consultant.
- Deliver: This phase begins with the presentation of a formal proposal and the customer's subsequent formal acceptance of the solution. Implementation and support of the solution are next, followed by maintaining and growing the relationship with the customer.
This process is a 180-degree turn from conventional selling, and your reps need your coaching and support to help them apply the process. To avoid the pitfalls of using outdated methods (including, but not only, the unpaid consulting trap), work through the following ideas with your team:
- Prevent premature presentations. Discuss this question: why should we present a solution to customers' problems before they clearly understand what those problems are—and, more to the point, before a customer fully comprehends the problem and recognizes that you do too? While most salespeople devote the majority of their face-to-face time presenting and handling objections, the most successful salespeople spend the majority of their time collaborating with customers, diagnosing their situation, designing or creating a desired solution, and building their resolve to actively solve the problem.
- Don't lead the witness. The traditional sales or marketing representative draws conclusions for the customer—often prematurely—and presents them to the customer before the customer is prepared to hear them. It is important that the customer discover and take ownership of the problem before deciding to seek a solution. If the rep moves ahead of the customer, the customer is likely to interpret the rep's actions as pushy or manipulative. This leads to a lack of trust and creates a confrontational rather than cooperative atmosphere.
- No pain, no change, no sale. Dissatisfaction is the most basic human motivator for change. It is the natural defense mechanism that tells people that if they don't change and deal with a problem, they will face consequences. Change itself is painful. As a result, change will not occur until an individual or company recognizes that it would be more painful not to change. This is why it's critical that your reps conduct a thorough diagnosis that uncovers the pain of the current situation and the lack of the future outcome. As you know, nothing less will motivate the customer to change.
- Go for the “no.” One advantage of a thorough diagnosis is that it allows the salesperson to quickly identify the 20-30% of prospects who have the immediate reason and resources to make a change. This focused approach to viable opportunities is critical to managing your sales goals. A thorough diagnosis is the difference between an intellectual conversation about a desirable future and an objective observation and measurement of real indicators of an unacceptable present. The traditional salesperson wastes time arm wrestling with prospects that have no pain, and hopes to win the sale by sheer tenacity. You know this behavior: it leads to unpredictable forecasts and sales that never come to fruition.
To change your reps' approach it is important to understand that this behavior has its roots in the mindset that a good salesperson never takes “no” for an answer. Many salespeople think that “no” equates to personal failure. Help shift this thinking. Coach your reps to always ask themselves, “Is there someplace better I could be?”
Clearly, the role of the sales and marketing professional has changed dramatically. The often-ignored reality is that customers need expertise to help them (1) understand the problems they face, (2) design optimal solutions to those problems and (3) implement the solutions.
It is up to you to equip your sales force with the ability to provide the help your customers need. Help your reps see themselves as project managers for their customers' buying decision. That is the secret behind succeeding at the complex sale.