STEP 1: PROSPECT
PROSPECTING IS ALL ABOUT GOING INTO THE WORLD TO find
prospective customers.
Everyone is not going to buy from you. Prospective customers are people and/or companies who are likely to buy from you. You need to find as many of these people as possible to qualify your assumptions around the need they have, and which your company is about to solve.
What is a prospect? There is a lot of debate about this and many people see a prospect as being the same thing as a lead. The best way to define a prospect is by first looking at the definition of a sales lead.
Accord to Investopedia:
A SALES LEAD is a prospective consumer (or client) of a product or service that is created when an individual or business shows interest and provides his or her contact information. Businesses gain access to sales leads through advertising, trade shows, direct mailings and other marketing efforts.
From this, we can conclude that a prospect is someone you believe may be interested in your product or service. But you need to test your assumptions on whether this prospect is indeed a qualified lead. How do you do this? You ask a series of questions designed to reveal if the prospect is in fact a qualified lead.
How do you prospect?
The key to successful prospecting is to know your customer profile. Your customer profile should be as clear, specific and finite as possible. The more detailed your customer profile is, the higher your prospecting hit-rate will be.
Note: Refer to your Customer Segment section of your Business Model Canvas for this detail.
Sources are key
We are fortunate to live in a digital age, where much hard work can be done quickly, in front of a computer. It is foolish to focus only on digital sourcing and equally simple-minded not to use computers at all. Your aim should be to establish a wide base for sources that takes advantage of real world and digital social networks.
Think about:
COLLEAGUES, FAMILY AND FRIENDS
Ask people in your daily life if they know any potential prospects to whom they could introduce you. This is a great training ground for those still finding their sales feet, and it’s a space where resistance from prospects will be low.
NETWORKING
Attending networking events is one of the most cost-effective ways to find prospective clients. Ask Google where you are most likely to find a congregation of prospective clients in your area. Register to attend. Show up and be ready to meet your prospects.
SOCIAL MEDIA
Explore your social media network for prospective clients. You’ll be surprised at the power of connections you have already established on social media. Start working on your different social media profiles in preparation for the time you will need to go prospecting. And don’t get the order of this wrong! Prepare your profile long before you start prospecting. Assume every contact will look at your profile in fine detail for proof that you are the real deal.
ADVERTISING
Yes, people still do this. Good old advertising is still effective. It can be expensive, but the avenue has expanded in the last few years. Channels such as Google Ads, banners on websites, and Facebook for Business can be cost effective. And, of course, advertising can also be free. Think of second-hand car sales. I doubt that there are many dealers left in the world who don’t post vehicles on second-hand car sales websites.
If you operate in the B2B (Business to Business) space, you can easily find potential prospects on Google by simply searching for businesses in a particular category.
YELLOW PAGES
Do these still exist? Well, I do see them lying around sometimes, and they aren’t just incredibly useful door- stops.
Flipping through the Yellow Pages is a different, quite physical, experience to Googling or searching online. Never mind what people say, the Yellow Pages can still be a great source of prospects for you – you are likely to see new opportunities in different ways by switching search techniques occasionally.
THE SALES FUNNEL…
…IS A SYSTEMATIC APPROACH TO SELLING A PRODUCT or service. It is also referred to as a sales pipeline:
Typically, you need to work through a lot of prospects to achieve a sale. Let’s say you have 1,000 prospects. Out of those 1,000, 500 may be interested in your product or service. Out of those 500 people, only around 50 people will end up buying, at least in the first year.
Why is this?
Well, some prospects fall through the cracks because you don’t follow up with them. They may well end up buying from a competitor or are simply “qualified out” of the sale because they can’t afford your product or service, or because they lose interest. Therefore, you always need to fill your sales pipeline with more prospects.
Of course, there are other things going on as well. Sometimes people just aren’t ready to buy – yet. According to Gartner Research, 67% of prospective buyers that say “no” today will be ready to buy in the next year. And, according to Sirius Decisions, 80% of leads you currently consider to be “dead” will buy from you within two years.
The result of ongoing prospecting is a Sales Funnel. This is a dynamic way of generating leads and selling your products and services, using several sales stages. It initially starts with collecting your prospective customers’ set of contact details that includes company name, (if applicable), and the contact person’s name and contact details (a phone number and/or email address are vital, and a physical address is always useful, where
STEP 2: CONTACT
THE ELEVATOR PITCH
As you move from internal communication (talking with business partners, potential investors and early adopter customers) to talking to the world at large, you need to refine your message so that it is as clear as possible, using as few words as possible.
The elevator pitch is a useful concept here.
Coined by Donald Trump, believe it or not, the elevator pitch refers to the idea that you should be able to present your business (and arouse interest in it with a potential customer, investor or partner) in the time it takes an elevator to get to the top floor of a New York skyscraper; that is, in about 30 to 60 seconds.
The reason the idea has taken hold in the business world is that it forces us to do that thing with which we all struggle. It forces us to edit and refine, to reduce a concept to its essentials. This is always particularly difficult to do when you are the owner of the concept, which is why significant work and focus is required.
An elevator pitch should include:
1. WHO you are.
2. WHAT you do.
3. FOR WHOM you do it.
4. WHY YOU – the Unique Selling Proposition (USP); and
5. An ending with a QUALIFYING QUESTION (i.e. something that prompts the listener to think about whether they would benefit from your product/service).
Of all the elements of the elevator pitch, the USP is, in my experience, the factor that most clearly defines success or failure when businesses start communicating with the general market.
UNIQUE SELLING PROPOSITION (USP)
CREATING YOUR USP MEANS CREATING THAT STATEMENT, benefit or advantage that differentiates your product, service or company from your competitors.
This is the time to start taking your competition that much more seriously. This is the time to:
• Let go of revenue streams that haven’t delivered.
• Explore revenue streams you might have overlooked.
• Think about complimentary products or services internally and externally.
• Consider which suppliers or partnerships you could leverage off to help add more value to your offering.
• Investigate how else you can make your offering that much more unique – relative to what is already in the market.
Think of the likes of McDonald’s with their drive-thru – now copied by every other fast food franchise. Or Scooters with their “we will deliver in 39 minutes or the pizza is free” promotion – also widely copied by rivals. Or Kellogg’s, the first breakfast cereal brand to put prizes and toys into a cereal box.
A powerful USP has many advantages. It can launch your business on a large, public scale and can help you to gain a lot of media and PR coverage if “sold” correctly. The media is always looking for stories of unique businesses, as well as stories about how entrepreneurs make the lives of customers easier. This is the stuff that gains the ears of journalists and editors alike. Your challenge is to develop a USP that gets your story out there and allows you to leverage these low-cost marketing and communication opportunities.
EVOLUTION IS EVERYTHING
AS SOON AS YOU LAUNCH YOUR PRODUCT and its USP into the market, you need to look to evolve. Competitors will be frighteningly quick to start copying your idea.
FIRST CONTACT
YOU NEED TO CONTACT PROSPECTS TO QUALIFY THEM. This can be done primarily by phone or email, and, in some cases, will lead to a conversation which will eventually need to happen in person. There are, of course, several methods to make that initial contact.
COLD-CALLING
Cold calling is when the person receiving the communication (which can happen via a phone call or email) was not expecting the interaction. Cold-calling is often frowned upon – for obvious reasons. But that doesn’t mean it can’t be effective, if done correctly.
Most people don’t appreciate random contact about a product or service that isn’t at the front of their mind. An equal number of people hate unsolicited sales conversations in general. The truism I mentioned earlier in this book stands: people love to buy, but they hate being sold to.
Even when a prospect is potentially interested in your product or service, you may still get a negative response to a cold call. It is essential that you respect people’s privacy and choice around wanting to meet with you or not. Being able to respectfully change someone’s decision around wanting to converse with you, is what will make you successful at cold-calling.
Don’t give up too easily:
• 81% of sales happen after seven or more contacts with the same person/prospect.
• 85% of the time we stop after one or two contacts with the person/prospect.
SETTING UP THE MEETING
The more potential customers whom you see face-to- face, the more sales you can make. So, how do you get an opportunity to speak to or meet with prospects? You ask to meet them. It’s that simple.
Two weapons will serve you well in getting people to agree to a meeting:
WEAPON 1: A CLEAR AND CONCISE VALUE PROPOSITION
Even though people don’t like being sold to, most will give you a chance if you can give them a Bloody Good Reason to listen. Your value proposition is this Bloody Good Reason.
DOES YOUR VALUE PROPOSITION HOLD UP?
CLICK THROUGH TO The A-Game Business Blueprint online course to assess whether your value proposition is effective, and to access tutorials, videos and exercises.
WEAPON 2: AN IMPRESSIVE AND ATTENTION-GRABBING ELEVATOR PITCH
We’ve covered what an elevator pitch is already above, and you can access the online course to get some practical examples and exercises.
General advice: shoot for a conversation, not a hard sell.
Don’t ask your prospect, on the phone or in your first email, if they are going to buy your product or not. This is too aggressive.
The aim of this contact is to slide gently into a conversation. This conversation will help you to understand if there really is a possible fit. Does this person have a need for your product? You must know the answer to this question before you try to sell your product or service.
Keep in mind that, in some cases, you will meet people who are immediately open and honest about why you are both talking. In this case, follow their lead, and talk directly about why you are meeting with them.
Remember: Follow-up is the mother of all sales!
STEP 3: MEETING THE PROSPECT
IF YOU GET A MEETING WITH A PROSPECT, you have achieved a lot. This is the time to focus and be prepared. Before you get anywhere near the meeting, you need to understand what your objectives are.
THE BIG THREE SALES MEETING OBJECTIVES
1. BUILD RAPPORT
A meeting is a precious opportunity to build a relation- ship and establish trust. If you manage to do this, you may well have laid the foundation for repeat sales, and this is the Holy Grail. Use the first moments of the meeting to tell the prospect more about who you are, what you have done or achieved, and how you have helped other customers. Remember to be honest and open. Don’t focus too much on business. Let the person get to know you in the most general sense.
2. NEEDS ANALYSIS
Once you reach the technical aspects of the meeting, focus on the problems or pain the prospect is experiencing. In other words, find out what the potential customer needs.
Not everyone will buy the same thing for the same reasons, so make sure you pay real attention to the what, why, when and how of the client’s pain. Don’t make the mistake of rushing to offer a solution without listening to the detail of the client’s issues. When you rush to offer your product, you are sending a clear signal that you have your own interests at heart, rather than the person you have come to see. Also, you can’t genuinely help a customer until you know the exact details of their need.
Make sure you listen carefully to the language the client uses. Some will speak about problems they are experiencing, while others will speak of aspirations they have. Recognizing the difference between the two mindsets will help you to better understand why the prospect would eventually invest in your offering – and, therefore,
how you should position your offering in their eyes.
HOW DO YOU FIND OUT WHAT THE PROSPECT MIGHT NEED FROM YOU?
ASK QUESTIONS!
Examples:
How much do you spend on your electricity bill every month?
What about your current logistics service provider would you change if you could?
How does not having pay slips affect your relationship with your employees?
How does that make you feel?
What do you think would help solve your problem?
Tip: Ask your prospect if they mind if you take notes during the conversation. This is a great way to show respect for the subject at hand, and notes are always useful as a relationship develops. You’ll be surprised, once the sales process is moving, how often you need to refer to what seemed like a minor detail at the time.
5. QUALIFYING
Once you have listened to the potential customer describe their problems, you will be able to understand if they:
– Have a need for your product; and
– Have the budget to spend on your product or service.
Dealing with prospects who are a mismatch, or who don’t qualify as an ideal customer, can be a waste of time, energy and money. On the other hand, dealing with a client that is a great fit increases the probability of success for you and the client. This is your priority. The great fit. These clients are the least likely to bail out of the relationship at short notice. They also cost less to bring on board and have the highest Customer Lifetime Value (CLV).
WHAT IS CUSTOMER LIFETIME VALUE (CLV)?
CLV IS A PREDICTION OF THE NET PROFIT ATTRIBUTED TO
the entire future relationship with a customer. In other words, CLV describes the amount of money you stand to make throughout the relationship with that customer.
Do the math
To calculate CLV, you need to multiply 3 pieces of information:
In the example below, the CLV total is $5,000. Knowing the worth of each customer can help you find ways to connect better with each customer.
STEP 4: MAKING YOUR PROPOSAL
ONCE YOU ARE CONFIDENT THAT YOU UNDERSTAND the nature of the potential client’s pain, make your proposal.
If you are sure of your perceptions, make your proposal on the spot. Alternatively, start by demonstrating how your product works. The more your client is able to touch, feel and experience your product, the better they will understand the benefits, and the closer you are to closing the sale.
Remember, it is vital to tailor your presentation to the wants and needs of this specific customer. Don’t do a generic presentation unless you have no other choice. The more specific and tailored your presentation (and, therefore, your value proposition), the better your chances of moving the lead to the next stage of the sales process.
THE THREE ESSENTIAL ELEMENTS OF A PROPOSAL:
I. How much do you normally spend on this every month (qualifying)?
II. What budget would you like to allocate to this (qualifying)?
III. This is what we can offer you (your value proposition).
Your proposal can be as simple as a quote. But this will only work if you offer the prospective client a (very) compelling value proposition. I highly recommend that you draft a proposal, even if it’s only one page long. This will help you to reiterate the benefits and value that the customer will gain by buying your product or service.
HANDLING OBJECTIONS
OBJECTIONS ARE CONCERNS A CLIENT HAS that prevent them from buying from you. Objections do not mean ‘NO’.
Objection handling is effectively addressing the buyer’s concerns. It is a vital skill for salespeople. So, how do you handle objections?
You use a working technique:
• First, acknowledge the objection. For example, you could say something like: “I hear you, and thanks for bringing that up.”
• Then, ask a question (or two) about the objection, so that you understand why it has been raised, and if there are any dimensions to the issue you haven’t thought of yet.
Handling objections, example 1: “It’s expensive”
• Your response: “I hear you and thanks for bringing that up. What are you comparing it to when you say it’s expensive?”
Or
• “What makes you say it’s expensive?” Or “Is cost the most important factor to you in this assessment?”
Handling objections, example 2: “I don’t have money right now”
• Your response: “Thanks for telling me that. When do you think your budget will be able to manage this cost?”
Or
• “Is a payment plan an option for you? This is something I could consider.”
Or
• “It’s always an option for you to pay a deposit now. When you are ready you pay the balance, then we can deliver. Would that work for you?”
Or
• “How can I make it easier for you to buy from us?”
Try a bit of role-play.
This all sounds fine, I’m sure, and reads well too. However, there is nothing that beats real-world practice. It can be a very valuable exercise to pair up in two’s and practice handling each other’s objections by sharing role-playing duties, using the examples detailed above, or scripts you have developed yourself. Role-play works well, because it gets the words you need to use onto your tongue, and once they are there, they become much more familiar to you than if they stay on the page, or in your head.
STEP 5: CLOSING THE SALE
THIS IS THE MOST CRITICAL STEP OF THE SALE, and one that most entrepreneurs and salespeople either get completely wrong or fear doing the most, or both. Closing is all about asking for the order. In other words, asking for the money!
But wait … have you covered all the potential customer’s objections? Don’t try and close the sale before you have addressed every single one of these. If there are outstanding issues, big or small, deal with them. Make sure your prospective customer is happy with the solutions offered.
Now you can close.
But, I hear you ask, how do you close? How do you actually ask for the money?
Well, ask the right questions, in the right order, and closing has a natural flow all of its own.
THE QUESTIONS:
1. Which color would you like to order?
2. How many would you like to order?
3. When would you like us to deliver?
4. Can I get an order number from you?
5. Can I send you a quote?
6. Would you like us to go through the agreement and then sign it?
7. Can I write up the invoice?
STEP 6 AND 7: COLLECT THE MONEY, AND DELIVER ON YOUR PROMISE
THE SALE IS NOT COMPLETE until the money is in the bank. Actually, scratch that. The sale is not complete until the money is in the bank and the customer is satisfied with the product. This is a particular issue in the world of services, where often 50% of the project fee is paid up front, and the balance is paid according to a delivery schedule. Now, you might think that only having half the money would ensure business leaders are wise and judicious with project spend, especially seeing as much of it goes to covering hard costs, but this is often not the case.
Why?
Well, a business is not a one-client concern. The operation will most likely be servicing several clients at once, and if there is any kind of average cash flow crisis across the business, one project’s budget is all too quickly spent on another project’s costs.
So, let me repeat.
Make sure you complete the sale by:
– delivering the goods or services as required at a high standard; and
– collecting the money that you and the customer have agreed on.
It is important that you have an agreement, or some form of signed document, to prove that you and the client have agreed to the terms of this transaction. This document can be referred to if there are any misunderstandings, issues around damages, complaints about quality and so forth.
STEP 8: SURVEY THE CUSTOMER
CUSTOMER FEEDBACK IS AN EXTREMELY IMPORTANT aspect of business that many medium-sized players miss. In fact, it’s interesting to me how many of these businesses miss out on feedback opportunities, even when they are channeling important resources into getting the feedback from customers in the first place.
One of the primary reasons this happens is some- thing that cognitive scientists call “confirmation bias”. This is the tendency that all humans have to look for evidence that supports what they are already thinking. A lot of the time we struggle with negative feedback, critiques and criticism. It feels bad emotionally when a customer expresses a negative sentiment, so we shield ourselves from these when it comes to our strategic thinking and focus on the good stuff – the positive feedback we like to hear.
Unfortunately, and especially in the early years of business, it’s the negative stuff that holds the most value. This is where you can gain key insights into evolutions and changes to what you’re doing that will improve margins, profitability, general sustainability and the customer’s ultimate experience.
There are several tools available to help you get this feedback. You may want to think about incentivizing your customers to participate in the process. Always keep in mind that the modern consumer is consistently pressed for such participation by a variety of brands and companies.
This doesn’t mean ignoring positive feedback. What it requires is an approach that strives for balance between the attention given to negative and positive feedback.
FEEDBACK CHANNELS
WEB SURVEYS
There are many tools designed to help you design feedback forms which your clients can fill in with a few clicks of a mouse. Top performers include:
– Survey Monkey: http://surveymonkey.com/
– Survey Gizmo: www.surveygizmo.com/
– Google Forms: www.google.com/forms/about/
POST-SALE/SERVICE QUESTIONNAIRE
A word document (or a link to an online survey) can simply be emailed to the client once the sale has been concluded, or the project completed. This is a good methodology to build into your business because it will force you to collect contact details and email addresses for your clients, which are very useful for all sorts of things.
Remember to ask the client if they would prefer to do a telephonic session to save them the hassle of typing.
ASK FOR REFERRALS AND A TESTIMONIAL
Ask the client for referrals. Do this by simply asking them if they know anyone who could benefit from your product or service. If the client has praised you enthusiastically, ask them to write a one-paragraph testimonial for your website. These can be used in many contexts, but the website explanation is easy to understand, and hard to refuse.
REPEAT THE CYCLE – IT’S A PROCESS!
OK, BACK TO THE BEGINNING. The very beginning. In the introduction to this book, I spoke about the emotion of doing business, and how process is the solution to managing this emotion.
Now read through the first eight steps of this process again. It sounds like a lot, doesn’t it? Damn right it does. It sounds tiring. Extremely tiring. And endless, and not in a good way. If any of the steps above go wrong, it could be a terrible kind of Groundhog Day, in which you find yourself repeating the same mistakes over and over.
This is where a process is extremely valuable. The key is not to get caught up in the results of any one of these elements. Somewhat surprisingly, the results are not what counts. What counts is refining the process and seeing how you can improve each step within it to make things more efficient and effective for your company and your customers.
When you focus on the process, you’re in a strong position to manage negative events (by managing the process well, while not getting too caught up in the event itself), as well as to appreciate that good events can get even better (by improving the process as much as possible, while not getting too caught up in the success of the event itself).
Your ultimate goal?
To develop a road map to each of the eight steps that will allow a total stranger to arrive at your company and carry out any of the steps, according to the instructions provided, and with the tools supplied.
Get this right, and you’re on the road to achieving scale – to establishing a business that reaches far be- yond your personal life.
ASKING AND ANSWERING THE KEY QUESTIONS
IF YOU DON’T KNOW WHERE TO START when it comes to understanding your approach to sales, write down some answers to these questions. Once you’re done, you’ll have a clearer view of where you stand, and what you need to do.
Most of these questions should already have been answered in your Business Model Canvas exercise)
1. What service(s) or product(s) does your business provide, and what needs does it fill?
2. What is unique about the products or services you offer?
3. Why will a consumer buy from you, rather than the competition?
4. How will you reach your potential customers?
a. Advertising
b. Social media
c. Marketing and public relations
d. Events and experiences
5. Describe your best client:
a. Where do they live?
b. How old are they?
c. Are they married/single?
d. What is their gross total income?
e. How do they think and behave?
6. Average Client Value:
a. How much will your best client spend on an average purchase?
b. How often will they buy from you each year?
c. For how many years will they buy from you?
7. How many sales will you need each year to reach your sales targets?
8. How many new clients will you need to add each year to meet your sales goals?
9. How many salespeople will you need to generate and to convert this number of sales each year?
10. What geographic areas or markets do you serve? Will you be selling:
a. Just in your metropolitan area?
b. Across the country?
c. Internationally?
