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April 22, 2005  http://www.thecompetitiveadvantage.net
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CONTENTS:

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The Secret Ingredient of Sales Success: Add Red!
By Jeffrey Gittomer

“How do I make more sales?”

“What’s the secret of sales success?”

“What can I do to get out of the sales doldrums?”

“My product is becoming a commodity, what can I do?”

Take heart, salespeople and sales managers, these are NOT problems. All of these questions are nothing more than sales symptoms. The problem, or better stated, the core of the problem, is the heart of the issue, or rather the lack of heart. Your lack of heart.

Why do you lose sales to competitors?

Why do prospects not return your call?

Why can’t you get to the real decision maker?

When confronted with reality, or sales truths that are uncomfortable, salespeople and sales managers tend to be defensive and tend to have answers for situations that are more of convenience than of fact.

They are quick to blame everyone else and their dog, but almost NEVER take responsibility, much less admit that the fault is their lousy sales skills or mediocre effort.

Why do some salespeople moan and complain, while others are out making big time sales in the same marketplace? In every market product or service, there’s a sales-leader. And more often than not, that leader is not the lowest price. Where’s the commodity issue there? Answer: there isn’t.

Let’s get back to the salesperson. That would be you. What are you complaining about? It seems to me if you took the same effort and energy that you used complaining, and converted it into creative thought, all of your problems, symptoms, and barriers would disappear as you developed answers.

To combat this dilemma I began to write a series of ideas and principles about “how to succeed while others were whining.” The body of work became so substantial that it’s now in book form called, “The Little Red Book of Selling -- 12.5 Principles of Sales Greatness”, subtitled How to Make Sales Forever.

The reasons for “red selling.” are obvious. Red is the color of passion. Red is the color of love. Red is the brightest color. Red is the most visible color. And red is fire.

Salespeople need to love what they do, be passionate about what they do, believe in what they sell, be bright about their selling process (both intelligent and visible), and salespeople have to be on fire.

You may not love what you do enough to create the passion and the drive to go beyond your problem or symptom and prevail. And if your competition DOES have that passion and DOES have that drive they will prevail even if they are not the lowest price.

The good news is so can you.

The question is: how passionate are you? How much do you love what you do? How bright are you? How visible are you?  How on fire are you?

The answers to these questions will reveal your inside thinking and your inside feelings. And it’s those thoughts and feelings that determine your outside success. Your sales numbers. Notice I did not ask how low priced are you.

In the Little Red Book of Selling, you will have the opportunity to understand the elements of why sales happen and why people buy. And by mastering the elements, make sales happen for yourself -- forever. The difference between success and mediocrity in sales starts with philosophy. Most salespeople think “end of the month.” But you have to begin thinking “end of time.” That’s how I think.

If you think “end of time,” each time you are in a selling situation, the sale will always be long term, relationship driven, and referral oriented. And it has nothing to do with sales manipulation, or other seedy tactics, that have given real salespeople a bad rep. The Little Red Book of Selling could also be titled the Little Red Book of Buying. The subtle difference in sales between the successful and the unsuccessful, is the difference between trying to sell what you have, and creating the atmosphere where the prospect will buy what you have. ‘People don’t like to be sold, but they love to buy,’ has become more than a registered trademark to me --it’s my mantra.

If there is a secret of selling, it lies within YOU, not your techniques. At the very heart of your sales success is how deeply you believe in the validity of your company, your product, and yourself. I’ve just chosen the word RED for the book because it seems universally transferable.

Now it’s time to ask yourself a few hard questions. Are you at your job every day because you want to be the best at sales? Are you at your job everyday because you want to help other people? Are you at your job everyday because you love your company? Are you at your job everyday because you love your product? OR, are you at your job because you think this is a place where you can make some money?

When you’re not making enough money you’re looking around to see who is to blame. Let me give you some easy targets. The competition, the quality, your pricing, your management, the economy, your production schedules, the warehouse, the computer system, and in general, everything and everybody else except you.

To me, blame indicates lack of passion, lack of dedication, lack of understanding, and lack of belief. To me blame is the easiest way out. If you’re blaming lack of sales on market conditions, or your company, you’re probably also complaining about the weather.

SECRET: Maybe you need to also re-address the way you “go for the sale.” Your approach is probably backwards. You’re still out there “selling.” What are you doing that for? I just told you, “People don’t like to be sold, but they love to buy.” The Little Red Book of Selling is also a book about uncovering about buying motives.

If you know “how to sell,” and I know “why people buy,” I’m gonna win every time. Full understanding of that simple truth, that simple strategy, will change your selling process forever, and double your sales.

Suppose you could have any sales job in the world. What would it be? Is it just a dream? A dream muddied by financial obligations and geographic obligations that you think you can’t do anything about. Think again. Anyone -- salesperson or sales manager -- who dislikes their job and wants to quit for a “better job” or “better opportunity” usually does it for all the wrong reasons.

I counsel people in sales at all levels. To those thinking about leaving, I tell them to become the number one salesperson in the company, then quit. If you leave a job angry, you’ll get to the next job angry. If you leave a job as the number one salesperson, you’ll arrive at the next job thinking you’re number one before you ever make the first sale.

HOPE: Salespeople can create their own work environment, their own success process, and their own victories; it’s easy to do. All you have to do is sell a bunch of stuff. It’s easy for me to write about it, but the reality is it’s harder for you to do it. Unless you enter the “red selling zone.” Here’s how: By choosing something that you love, by becoming more visible, by building your passion, you become “red.” And that red is easily transferable to your customer.

Belief in what you do drives your passion to succeed at it. Self belief is one of the strongest and most valuable characteristics a salesperson can possess. And it’s not an option. Salespeople who are in sales “for the money”, rarely make it.

Mediocrity in sales does not come from lack of skills, it comes from lack of belief in what you’re selling.

You may know “red” by some other words; drive, focus, belief, positive attitude, and enthusiasm. I’m challenging you that this is not about sales-skills analysis or market analysis. Rather, it’s about self-analysis and self-actualization that will lead you to the reality of where you are today. The best news is, if your reality is not where you want it to be, you can change it.

When you find your passion, when you find your love, you will find your red. Forever.

Jeffrey Gitomer, author of The Sales Bible, The Little Red Book of Selling, and Customer Satisfaction is Worthless, Customer Loyalty is Priceless. President of Charlotte-based Buy Gitomer, he gives seminars, runs annual sales meetings, and conducts internet training programs on selling and customer service at www.trainone.com. He can be reached at 704/333-1112 or e-mail to salesman@gitomer.com
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Engaged Employees Tend to Engage Customers
By Michael Kust

This year – as in previous ones – external marketplace pressures will grow, internal company expectations will swell and customers’ demands will grow higher. You can’t directly control the competitive marketplace and you probably can’t really influence your company’s edict for enhanced profits.  So what’s left?

As a sales or marketing professional, remember that the ‘secret weapon’ in your arsenal for winning the game is delivering a superior customer experience. To do so, you need the basics: the ability to identify individual customers, to differentiate them by value and by needs, to customize aspects of your products accordingly and to interact with them in a continuous learning relationship. But where the ‘rubber meets the road’ – where these sales and marketing truisms literally come to life – is with your employees.  Actions speak louder than words, and as a consequence, engaged employees have the potential to shout your brand promise so that it’s clearly heard above the competitive din. 

There are many good arguments for justifying an investment in employee recognition and reward programs. From an altruistic perspective, it’s simply the right thing to do – treating one another with respect and thoughtfulness.  And then there’s the more self-serving considerations, too: enhancing the company’s public image, reducing expenses associated with employee turnover and retaining the competitive advantage encapsulated in the collective tacit knowledge of your workforce. But the best argument for an employee program is this: recognizing and rewarding employees drives engagement, thereby delivering a positive customer experience that will yield enhanced customer sales, loyalty and brand strength.  Is your company interested in more sales?  Better customer loyalty?  A stronger brand?  Then read on.

Sales.  In Jeffrey Pfeffer’s book, The Human Equation, a research study is described that documents a $27,000 improvement in sales per employee for companies that increase “high commitment work practices.”

Loyalty.  SAS Institute is renowned for its employee practices. Is it any wonder it enjoys a 95 percent renewal rate on its products?

Brand Strength.  Ritz-Carlton is a widely cited example of a company that creates employee brand champions, such as “ambassadors” of the hotel.  As a result, the company has succeeded in winning the Malcolm Baldrige National Quality Award – not once, but twice. And from the customer perspective, Sun Microsystems has demonstrated a statistical linkage between employees recommending the company as a place to work and customers recommending it as a place to do business.

Contrary to what you might intuitively expect, the degree of business result achieved by your employees through delivering a positive customer experience is not symmetrical.  Research shows that a 1 percent increase in customer satisfaction yields a 2.4 percent increase in ROI – but a 1 percent decrease drives twice as large a reduction in ROI.  Another investigation examined the impact of personal bankers on customers’ likelihood to recommend and to stay. Top-notch employee performance enhances those business outcomes, but those who perform poorly actually weaken customer retention relative to not having a personal banker at all. It’s clear that engaged employees delivering positive customer experiences improve your company’s performance. But it’s equally clear that failing to create a positive customer experience through engaged employees isn’t simply money wasted – it’s actually a net negative to your business.

As you work toward achieving your company’s goals in the new year, remember that customer outcomes and employee initiatives are inextricably intertwined. If you want the former, then it’s not an option to neglect the latter. The links are amazingly strong.  A study documented that a one point change on a six-point rating scale for employee satisfaction drove a 40 percent increase in the quality of client relationships which in turn yielded a 104 percent increase in financial performance.

Here’s the bottom-line. Engaged employees are an essential prerequisite for enhancing your sales, loyalty and brand image this year and every year. Too often, however, the chosen path to achieving these objectives is through the adoption of technology – buy more hardware, install more software. Truth be told, technology is important.  But it’s a very special type of technology that makes the difference: one that is wireless, high-bandwidth and embodies the latest neural network architecture.  It’s called an employee. The good news is that you’ve already got this ‘technology’ in your company. All you need to do is ‘activate’ it by using well-developed recognition and reward strategies.

Mike Kust is Chief Knowledge Officer at Carlson Marketing Group. Contact him at MKust@Carlson.com.
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Sales Talk2
Question: “There are conflicting ideas in our office about when is the best time to bring up price during a sales presentation. What is your opinion?”

View from the Field
John R. Graham

A. One way or the other, price issues always seem to surface as the major hurdle in sales. It isn’t that the price is too high, although that may be the common complaint from customers and salespeople, alike.

The central issue involves two distinct approaches: “price focus” and “solution focus.”

  1. Price focus. It’s easy for salespeople to believe that price is all that counts with customers. That’s true for some customers––but not for as many as we might like to believe.
    2. Think about it from the customer’s viewpoint. If you’ve been dealing with salespeople who are constantly pitching price, chances are they have conditioned you to think all that’s important is price––and everything else is pure hype. Simply put, there are salespeople who train customers, without realizing what they’re doing, to look for the lowest possible price, or the best deal, without taking anything else into consideration. As a result, customers don’t want to waste time. They expect the salesperson to give them the price immediately. It’s either on target or it isn’t. That’s it. Nothing more matters if that’s the focus.
  2. Solution focus. The concept here is that the price should not be mentioned until the salesperson successfully has built the case to justify it. Most salespeople find this a daunting, time-consuming and difficult task. They’re correct. It is. The solution is totally different. It requires research, questioning, several customer meetings, thorough preparation and a presentation. The objective of the solution-based salesperson is to train, and in many instances to retrain, the customer to see the purchase in a larger context. The chances of a salesperson moving attention away from price are much better if the focus is on the customer’s situation, rather than the product or service. Oreck vacuums, for example, sell for a higher price than most other vacuums. Most noticeably, the TV commercials for this product never include the price!

--John R. Graham is president of Graham Communications, Quincy, Mass.

View From the Campus
Jeff Tanner

A: If there’s a bet riding on this answer, no one will win. Early, middle, or late – all are appropriate. To some degree, it is the customer’s responsibility to bring up price. While that’s not always the case, much of the following discussion is based on that premise, and assumes you are working with the decision maker.

The best time varies depending on what you are selling and your positioning strategy. If you are positioning on price, then bring it up early, close early and move on. Most companies can’t afford salespeople who sell only on price. At the same time, however, there has been very little scientific research on the timing of price information, so what I’m about to offer represents an overview of selling theory, necessarily broad due to space limitations.

The real issue is when the customer will see the value and accept the price as valid. If you are priced competitively, there always will be someone who costs less than you do. Understand, though, that the role of price, as information, varies during the customer’s decision process.

The customer’s decision process is really a series of several decisions. An early decision is whether to buy something or to avoid the problem. That decision is a function of budget. Can the buyer afford to fix the problem? This decision has to be made before the prospect will consider alternatives. If the buyer already has done some shopping, and most have, at least on the internet, then the issue of budget may have been resolved. At the very least, though, ask a budget question early so you can make sure that you are in the right price category.

If you get a price question early from the buyer, then it may be a signal that the buyer is still setting a budget. Respond as clearly as you can and then ask if that meets the budget. While some sales gurus suggest postponing a price answer, to give no answer only annoys the buyer. If you truly can’t give an accurate price because you don’t know yet what you are selling, then give the range, even if it is ridiculously large. The buyer will get the point and appreciate your honesty.

Another decision is what features are wanted. If you have the ability to mix and match features, then price can’t be completely known until all of the needs and wants are out on the table and the appropriate solutions are combined into one product. Alternatively, you can build both product and price simultaneously, letting the customer decide as you go how much will be spent. This latter method can be very effective if you have the decision maker present because at the end of the discussion, the buyer has decided on what is wanted and what will be paid. Closing the sale is already done.

If a buyer has decided that something will be bought, and has decided on the features before meeting with you, then the price discussion is more difficult only because you don’t know the value of the product to the buyer. Note, however, that in this instance, price can serve as a measure of quality. While you may want to postpone because you know you’ll get a price objection and you have no way to justify with value, failing to answer a direct question is perceived as untrustworthy. Give the price along with a statement about your quality and then ask why they want those features. If the buyer bristles at your questions, point out that you are verifying that you’ve selected the best option based upon their needs.

Early, middle or late. Where is the buyer in making a decision and how will that information be used? This is the factor that will give you your answer.

--Jeff Tanner, Ph.D., is research director at Baylor State University’s Center for Professional Selling, Waco, Texas.

Send your sales management questions to editor Janine Nunes at JNunes@douglaspublications.com. Please put “Sales Talk2” in the subject line.
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How To Differentiate Your Message
By Michael Bosworth and Deb Voigt Swann

Understanding how you "shine" as a company, or how you help your customers, and being able to convey that to potential new customers--your messaging--are critical to your success.  Let’s explore how your messaging may be perceived by your prospects and suggest alternative ways to communicate your uniqueness.

Does your Messaging Convey Your Differentiation?
What makes a prospect want to buy from you? If you can readily and accurately articulate what makes your customer’s experience “unique and sustainable,” then you have just differentiated your company’s offering. Think about it. Companies choose you based on the customer experience you architect; they remain with you because you sustain that differentiation.

A universal concern facing companies today is how to differentiate. Even if they can define how they’re unique, the critical issue is not what these companies believe to be true about themselves but rather what a prospect believes about them. So, how can you communicate your potential value to new customers and motivate them to buy from you? Your Web site, marketing collateral and selling tools are vehicles to make a connection with potential customers. Our philosophy is that messaging should focus on the customer, not on the seller. We want you to connect with a prospect by focusing on what your offerings do to help them in their businesses, not simply on what your products are. We also believe that sales people have the most direct influence on how your company is perceived by a prospect. Sales people can execute messaging, but most can’t create messaging.

So, ask yourself: Does your messaging clearly convey how you help your customers achieve their goals, solve problems and satisfy needs? Can this same messaging be used by your sales people to help prospects understand how, by using your products, they can improve their businesses?

Messaging Examples From Actual Web Sites (Yikes!)
To illustrate the point about effective messaging, we looked at Web sites to see if they readily conveyed the company’s capabilities. We wanted to see if a new sales person could go to your site to prepare for a sales call. Could they understand the business issues faced by your clients? Could they also determine how to position your products in a way to help address specific business situations?

We took actual content from the sites, typically from the home page, and incorporated it into a mock phone script that illustrates how your sales people might be introducing themselves. Let’s call this the “seller-centric” script. As we navigated through the sites, we got a better idea of what you do so we also incorporated our interpretation of your content into a mock phone script. Let’s call this revised version the “customer-centric” script.  Which version do you prefer?

Example #1: Hello, this is John Smith with XYZ Software...
Seller-Centric: At XYZ Software we “accelerate the development and deployment of operational excellence and real-time performance management applications providing global manufacturers a sustainable competitive advantage.”

Customer-Centric: At XYZ Software, we help manufacturing companies meet production schedules, reduce inventories and reduce equipment maintenance costs. We do this by combining all of their supply chain data into a single Web-based view, so that they can act on the data more quickly.

Example #2: Hello, this is John Smith with CompanyX Software...

Seller-Centric: I wanted to let you know that “only CompanyX Software provides product development solutions, expert consulting and innovative technology.” We empower small to mid-sized companies with the ability “to design innovative products, improve your engineering process and competitively manufacture in today's global economy.”

Customer-Centric: Our software is used throughout the product development process to help designers create or modify designs more quickly and to reduce errors, so they can get products to market faster.

You may be thinking, “Our sales people don’t talk like that!” But, how do you know what the sales people are actually saying?   

Loading the Lips of your Sales People

As we’ve seen, messaging that appears on Web sites or in collateral may not be very helpful for sales people. We help our clients to provide their sales people with tools that highlight what to ask a prospect and how to effectively map your capabilities to the prospect’s business issues. Your prospects should be able to:

Does your messaging accomplish this? If not, what impact will this have on building your brand and compelling a prospect to choose your company over another? Effective sales messaging tools can help your salespeople uncover relevant business issues and position your offerings in a differentiated manner so that the prospect chooses you.

Michael Bosworth is founding partner of CustomerCentric Systems, LLC and is the best-selling author of Solution Selling: Creating Buyers in Difficult Selling Markets. Debra Voigt Swann is a licensed CustomerCentric affiliate.
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Direct Mail: Tips for Killer Copy Tactics
By Patricia Fripp, CSP, CPAE

What if you could send a two-page letter to a few thousand customers and it quickly pulled in lucrative new contracts?

To start: Good direct mail letters do not follow the classic rules of composition that you learned in school. In fact, these letters are examples of what I call "the spoken language in written form." They read more like a conversation with the reader than like an essay in formal English.

So it probably won't surprise you that I was having a conversation one day with myself and it turned into the following letter to my customers:

“Dear _________,

“Just the other day one of my best clients, Jerry, asked me: ‘Patricia, would you consider speech coaching for our CEO?’ I replied: ‘Why, as a matter of fact, this is the fastest growing segment of my business.’“Jerry seemed to be a little upset and said: ‘You know, I wish you had told me that earlier; I could have used you last year.’ In the very same week as my conversation with Jerry, three other clients asked how to market their expertise for a fee as a speaker. So many successful executives and business leaders get invited to talk about their experiences. Why not learn how to market that talent and success?

“It has never been my policy to upset clients; quite the opposite in fact. To make sure this does not happen in our relationship, I thought I would update you with all the other services we offer besides keynotes and seminars on marketing and customer service...”

The letter then explains my other services - presentation skills training groups, executive speech coaching and sales presentation training for sales professionals. The reader is given a variety of options on how to take advantage of available services, ranging from free articles on myWeb site to high-end customized programs.

What kind of results did the letter get? It was very successful and resulted in a number of personal coaching contracts as well as some long-term corporate assignments. Let's analyze three elements of this letter.

1) The letter's objective: My objective was twofold: first, to educate the readers - who already knew me as a keynote speaker - about new services I was offering; and second, to generate inquiries.

2) The letter's target audience: The people who received this letter all had one thing in common - they had communicated with me before. This letter did not go to a cold list. In direct mail jargon, it went to my "house list."

3) The letter's opening: It covers the same ground that the reader could conceivably cover in a live conversation with me. In an anecdotal way, it immediately reveals important information that readers of the letter would like to know.

Important point: One reason the letter was successful was that its objective, target audience and opening were carefully selected and worked well together, driving toward a single goal.

Now, let's stop and consider what we've just covered and how you can apply it to the sales letters you send out for your own business. Here's a review of key points:

The best direct mail letters are conversational in nature, rather than formal and overly businesslike

You should start by carefully and clearly defining your objective for the letter.

Pay close attention to who your target audience is for the letter, and write as if you are speaking directly to the people in that audience about their most pressing concerns.

Use an attention-getting opening sentence to set the stage for what's to follow.

You may be surprised to realize how much thoughtful preparation goes into a seemingly simple direct mail letter, but this preparation is well worth it. The actual cost of mailing letters can be very reasonable and the sales return can be astounding.

Patricia Fripp, CSP, CPAE is a San Francisco-based executive speech coach, sales trainer, and award-winning professional speaker on Change, Customer Service, Promoting Business, and Communication Skills. She is the author of Get What You Want!, Make It, So You Don't Have to Fake It!, and Past-President of the National Speakers Association. She can be reached at: PFripp@Fripp.com, 1-800 634-3035, fripp.com.
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American Customer Satisfaction Index: U.S. Consumers are Under-Whelmed
By Corinne Kuypers-Denlinger

Here’s an item that should top every company’s to-do list: Promise to become a customer-centric organization.

The payoff will be customer satisfaction, loyalty and the best advertising money can’t buy—word of mouth. While the advice might sound obvious, the rush to produce faster, smaller, better and cheaper high-tech products and services has caused a lot of companies to forget to ask customers whether they like what they are getting. You might be surprised at the answer.

The American Customer Satisfaction Index finds that consumers are under-whelmed by the newest and most advanced technology products. Instead, consumers are giving the highest marks to companies that are far from the cutting edge. The company with the highest index rating, 90, is H.J. Heinz, maker of family-friendly foods.

Other companies with higher than average ratings include home appliance manufacturer Kenmore (85) and auto maker Ford-Lincoln Mercury (86). Meanwhile, the best a computer maker was able to score was 81, for Apple. Hewlett-Packard scored 70, down from 78 in the first year the index was released.

Overall, the 200 companies in 40 industries tracked by the University of Michigan Business School, which compiles the index, received an average rating of 74.8.

Why such low scores when companies have been working to give customers high-quality goods at rock bottom prices? According to Professor Claes Fornell, originator of the index: “Price has an effect on whether you buy or not. It has less of an impact on whether you’re satisfied or not.”

That fact may be evident in the score of 75 received by the most efficient discounter of all, Wal-Mart. Amazon.com, on the other hand, received a respectable 88. Even though it may not have the lowest prices, the experience of shopping on Amazon apparently leaves consumers more content than shopping at Wal-Mart. While Wal-Mart succeeds on volume sales, most other companies must appeal to buyers’ needs or emotions by offering products and services that solve a problem or make a statement. Others also may rely on cultivating relationships with customers to earn repeat and word-of-mouth sales. That means going the extra mile and creating what experts call a customer-centric or customer-focused company culture.

Dr. Jodi Simco, consultant with the Hay Group, a human resources advisory firm, says two factors determine whether customers will be satisfied and whether satisfaction will translate into loyalty: the outcome that the customer experiences and the process by which the product or service is received.

Meeting customers’ expectations in the buying experience and in product performance requires a commitment to customer service throughout an organization.

As anyone who has made a purchase that has not matched expectations knows, a positive interaction between the company and the customer can be more important than reliable product performance. How the firm solves a problem determines whether a customer walks away angry, buys again or recommends the firm to friends.

Every company knows this, but not every company practices it well.

The start of a new year is as good a time as any for organizations to renew their commitment to customers.

Corinne Kuypers-Denlinger is editor in chief of Trend Letter. Reach her at CKDenlinger@Briefings.com.
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