This Week@Work, be sure to split your time and attention into growing your business revenue AND deepening its capital value. The cost of realising this too late is as devastating as it is unforgivable.
ThisWeek@Work cut through the noise of a million products and services bombarding your target customer by creating an experience of your solution that leaves them feeling something.
This Week@Work scaling growth through funding raised a bunch of questions that we should all have answers to. I loved the conversation with you Master Artisan Sourdough Baker Barry Cork and Rick Hooper… and will follow the breadcrumb trails of your certain success.
How often are you ghosted after a positive, warm sales call? You were on fire; the client was positive and responding and it was clear that your offer was right on point. And then, nothing. You can’t get hold of the client. You’ve tried email, phone, social media even and nothing.
Getting this sales challenge sorted needs you to get a couple of things right. Listen to Pavlo Phitidis discuss this on The Money Show:
- Why does your business exist?
Whilst your purpose might be to make money, create wealth, support the economy, generate employment, or make a difference to the world, your businesses doesn’t care. Its only purpose is to solve defined problems through a great experience for its customers.
- Become expert at serving customer segments.
You hope that it is enough to have an excellent product or great service offering, with all the right features to solve defined problems. The problem is that your competitors have equally good offerings. Let me be clear, without a good product or service offering you wont even exist. But on its own, it’s not enough.
- Develop a sales engagement system.
Whilst your product or service offering can fix a customer’s problem, how you engage with the customer creates the experience. This includes how you market to them, engage them in the fist meeting and should they select you, how you deliver on your service thereafter. All these activities stack up to create the overall experience. Your sales engagement process is an essential element of the experience.
- Master your sales discovery meeting.
Often when selling, you spend most of your time talking to your product or service offering. This product-centric selling was valuable in the 1700’s to early 1900’s. It simply is not good enough today. A smiling, nodding customer (seemingly hanging on to your every word) does not mean that they are engaged at all. Polite yes, but not engaged.
- Understand the “why” behind the problem at an emotional level.
Problem-solving selling has 3 layers of sophistication behind it. The first is to engage with the customer in such a way that they tell you the problem that they have. This is where many sales techniques go wrong. Mostly, you jump in with how your product or service offering can solve it and…. deal done! A fatal mistake.
Once the problem is stated, you should transition your line of questioning to understanding how and why and when the problem comes about. Spend time on this conversation. Get into the detail. Let your customer really drill down into the detail. At this point, your customers would almost be living the cause of the problem, and then you transition into a line of questions to understand how it makes them feel. That is the gold in selling. The emotional outcome of not having the problem solved, creates the opportunity for you to solve it and remove that personal, emotional pain.
- Solve the problem and resolve the “why”!
Now talk to how your product or offering can resolve the problem. Be sure also to ask how, with that problem resolved, the customer would feel. Be sure that in your engagement, that feeling, attributed to you and your product, confirms the emotional outcome of relief and certainty.
We all buy emotionally and justify logically. Fitting your product or service features to a stated problem is a lost opportunity and matches you to any other competitor in the market. Turning the stated problem into an emotive need matched to a personal problem is what sets you apart and ensures that “yes” is very highly likely a real yes.
MARKETING GENERATES, SALES CONVERTS
Sales and marketing are two very different activities and should never be confused or combined. Getting customers to know about you is one of the single toughest things for entrepreneurs to get right. This is why you need marketing. Effective marketing should generate new business leads.
With a firm new business lead, your sales effort becomes paramount. Successful selling sees the conversion of leads into customers. This is how you measure your sales efforts: the number of leads that become your customers.
How do I make sure new leads translate into sales?
Align marketing and sales and tell a great story
Marketing and selling are both sciences. Each compromise different activities which should be organised by the the entrepreneur into a sequence, and then set up as two systems that can be measured. Marketing and sales should never be built on the back of a personality because one person’s individual style can never be replicated.
An effective marketing effort creates an expectation with a potential customer about what they can expect from your business. In turn an effective sales effort should create a unique experience that builds trust and cements a relationship based on belief that the expectation generated by marketing will be met.
Converting leads to sales
Translating leads into sales is informed by tow core systems that must be set up in the business first.
Organise each lead generating activity into a sequence
Multiple activities should be driving leads all the time (emails, direct selling, cold calling etc) with each activity organised into a logical sequence that can be measured. For example, sending a promotional email to a database involves:
- constructing the email
- preparing the database
- dispatching the mail and
- recording the number of responses to measure the impact.
Create a selling system based on your unique offering
Selling is less about a great personality and more about creating a compelling experience for the enquirer. This experience is informed by what makes your business special and what differentiates it from others in the same industry. Selling completes the story started during marketing when the anticipation is formed is its the encounter that wins the customer over to your business.
Knowing how to focus your sales efforts on the most profitable customers can accelerate the growth of your business exponentially. It is a critical exercise because, with limited resources on hand, you need to focus your efforts, to maximise your impact and build your business’ momentum. On The Money Show with Bruce Whitfield, Pavlo Phitidis outlined a useful technique for positioning your business:
KNOW YOUR CUSTOMER
As the owner of a growing business, you may feel tempted to try and be everything to everyone. This impulse is rooted in wanting to generate an income as quickly as possible, but it’s never a good idea to try and solve every problem, for every potential customer that comes your way. Finding, and knowing, the customer that you are best suited to serve, and who would be most profitable for your business, is vital.
A TECHNIQUE FOR POSITIONING YOUR BUSINESS
We used this technique with a group of technology entrepreneurs and, through it, you’ll be well equipped to find the right kind of customer for your business, and solve their specific problems. This technique will help you to build your business to be customer-centric, rather than product-centric, by positioning your business correctly. To showcase this technique, we’ll focus on the product of a tin of baked beans.
1. UNDERSTAND THE ESSENCE OF YOUR PRODUCT OR SERVICE
Undertaking an in-depth analysis of your product will help you to better understand and define its capabilities and suitability for customer groups. Create a brief, feature-filled definition of your product, isolating what it can and cannot do, what it looks like and how it works. If we look at a tin of baked beans, we may ask the following questions: What does the tin look like? How many beans are in each tin? What do these baked beans taste like?
2. DEFINE THE GROUPS OF CUSTOMERS YOU COULD SERVE
Once you understand your product, look towards discovering the types of customers it can serve. Define who the people are that your product can serve, by detailing their demographics; lifestyle; likes; dislikes, and needs. We’ve outlined four definitive customer groups who may enjoy or eat our tin of baked beans:
- A mom with 6 kids
- A competitive athlete
- A busy business executive
- An artisan worker
3. UNDERSTAND THE PROBLEMS THAT THEY EXPERIENCE THAT YOU CAN SOLVE
Each of your defined customer groups will have unique problems they face, that your product could solve. These are some of the unique problems each of our chosen customer groups may face:
- Mom: needs our tin of baked beans to stretch as far as possible, and for it to be easy to use when her children are hungry.
- Athlete: needs a healthy, high-protein meal, that has muscle building capabilities.
- Business Executive: needs a convenient, on-the-go meal that’s nutritious and easy to make.
- Worker/Labourer: needs a filling, hearty, energy-boosting meal.
4. PLOT YOUR CUSTOMER GROUPS ONTO A MATRIX
Plotting your customer groups onto a matrix may sound complex, but it’s really a simple, four-block graph, that helps you to define your most profitable customer group. You’ll assign your customer groups into each quadrant by showing which group:
Has high or low profitability: Which of these customer groups can I serve immediately, with the product I have right now? How useful is my product to them?
Has a few, or many, members: How many of these customers are out there?
Through this, you’ll discover your ideal customer: the most reachable and most immediately profitable customer will be in the top right quadrant. For our tin of baked beans, that turns out to be the Business Executive.
5. CRAFT YOUR MARKETING AND SALES MESSAGES TO FOCUS ON THE TOP RIGHT QUADRANT
You can now focus your marketing strategy and messaging on your most profitable customer group, and find ways to communicate with them, in line with your business positioning.
6. BE DISCIPLINED, FOCUS AND PERSIST
Focus most of your marketing effort and budget on your most profitable customer groups, and remember that persistence is the key to momentum. Wealth, and the development of a successful business, is a cumulative exercise and not an overnight task. Once you’ve established a solid marketing effort that focuses on your ideal customer, you can look at apportioning some marketing effort towards the other customer groups, and perhaps even think about new product developments that may serve them best.
Do you need help with figuring out your ideal customer is, or positioning your business correctly? Aurik can assist, as we work alongside you to build your business into an Asset of Value.
Getting sales right is one of the most difficult tasks an entrepreneur faces, it is the ultimate testament of business understanding and sophistication.
Great salespeople don’t build a sustainable business – they do deals.
Pavlo chatted about the need to build a “selling engine” in your business on The Money Show . Listen to what he had to say here:
So what is a sales engine versus a sales team?
Things to consider:
1. A sales engine is bigger than a sales team and its more sustainable
2. Sales people walk in and out of the door daily, the engine if properly built is locked into the business
3. Horror stories
- Lose the star sales person? And having no sales capability at all.
- You pass on sales because you don’t like it! Not everyone is a natural sales person.
- You build a channel driven business model!
4. Success stories
- 97,8% of customers never met.
- Break the sine wave
How do you build a Sales Engine?
You should always take the Asset of Value approach which means:
1. Turn the business to the customer
- You can’t be everything to everyone
- The better you define the customer, the better the alignment
- It’s about solving customer problems not products
2. Understand the experience that customer wants to buy from you
3. Map out the activities that you need to create that generate that experience
4. This creates the selling system
5. Employ against that system
6. A clear job description is vital
7. Measurement of the system is vital
Even before Covid hit, you might have noticed that it takes longer to get deals done. What took 6 weeks is taking 12 to 16 weeks; what took 3 months is now taking 9 months if not a year. There are many reasons for it, but the reality is that to get deals done, you have sell across three domains.
Today, you need product value propositions, mindset value propositions and economic value propositions. Missing out one of them will double up on the time it usually takes you to do your deals.
Listen to the podcast here:
1. Product mindset value proposition
Products are great but seldom do they set you apart for a sustained period. There is simply too much competition to hold such an advantage unless you have patents. If you do, you’d better get a big bank account too. A patent is only worth your ability to protect it.
Having said this, why do people buy anything? They do so to solve a problem that they have. A problem not solved is a cost to that customer. It may take the form of hard cash for example a dripping tap costs money for so long as it drips. It might take the form of time. A good example is an old, tired computer whose hardware has run too many miles and cannot keep up with the demands of updating software. Alternatively, it could take the form of an opportunity cost. A tatty old suit might not leave a funder impressed with your request for investment.
Be sure you have understood what problem you solve and for who. Not everyone has the same problem or put differently, not everyone experiences the problem in the same way. Once you have understood the problem, cost it out. A problem that cannot be quantified is not well enough understood. That means, you are probably still suck in a product, not problem, value proposition. In understanding the cost of the problem, consider the cost of your product or service. the gap between the two is the value you have to offer and that’s what people and businesses buy.
In stressful times and economic apprehension, people only act and spend in relation to their immediate felt needs. Identifying and quantifying a problem that you can solve for them means you become their priority on attention and spend.
2. External/economic value proposition:
In a zero-growth economy you need to find growth and make things happen differently to when the economy is growing. Here are three areas that you can find growth in.
Change your value proposition to be relevant
A tough economy means things change for everyone. Think about unemployment rising; its impact touches everyone in that economy. When people loose access to money, they turn to family and friends for support. This means those who had the money now have less to spend. That means that the things they budgeted to buy – from new furniture to holidays, educational support or home improvements – all go on the back burner. It feels grim but only if you are selling in one dimension, the product dimension. It’s a great opportunity if you are able, with your current product or service, to understand its value differently.
Think of a landscaping and gardening business. It booms in times of plenty and is the first service cut in times of stress. A proposition that says invest in your garden now is unlikely to work when cash is tight. Or is it? What if the proposition suggests investing in your garden now at a fraction of what the family holiday would cost since it means summer fun around the pool at home instead? A different proposition, solving a new problem, emerging from an environment of financial stress, that disabled the former proposition that worked in times of plenty.
Outcompeting your competitors
In a tough, stressed economy, all your competitors feel the pressure. Sustained negativity and apprehension disables people and businesses. Consumer and business spending has, like a tap of flowing water, switched on and off consistently, and almost immediately with each Brexit announcement. In South Africa, we have literally become immune to political announcements since they happen at such a ferocious pace. Most people have resigned themselves to any action. That’s where the opportunity arises. Your customers want to buy services from a company that is positive and is investing. Those customers being served by negative competitors are the customers up for grabs. Approaching them today will increase your marketing and sales response rates.
Taking business from corporates
In this tough economy, the rate and pace of change from an emotional and financial perspective is seeing markets fragment. Corporates struggle in these instances. In addition, they are big, heavy, complex and slow-moving. Look at who your corporate competitors serve and approach them with a more flexible, faster-acting service offering and response. You will get reaction there.
3. Mindset proposition: Move from denial through anger, acceptance, change to adaptability
Who’s in control
Behind every business client is a person. Inside of every customer is a person. In a poor, negative economy you must add a psychological dimension to your sales activities. The best way to shift negative people is to help them see that they have full control over their futures. By far, most people are in the same space and by far, most are waiting for things to happen before they strike on deals. Whether it be for the elections to come and go or the sun to rise and set. Acting gives you power and acting over things you have control is extremely empowering. Have the conversation.
Fear versus gain
Loss carries more weight in cations than gain. It’s well known. Most people would rather act to first prevent loss, then act to attain a gain. Create an urgency by focusing on the cost of not having a problem solved. This spurs action far faster than promising a hoped-for utopian outcome in the future.
Finally, logic. Use logic to get people to act. This only works if you understand who your customer is, what problem they have that you can solve, what the cost of not having the problem solved is and how you can provide real value in getting it done.
Business today must stretch itself across all three domains. And it’s a great thing. You get better when you succeed in this. Your business grows and when the economy turns, you’ve developed habits and a way of working that sees you excel. After all, excellence is a habit.
Because we work with clients that come to us to grow, we are already in a good headspace. Because we pride ourselves in our ability to deliver growth, we eek out all the angles, arguments and opportunities to make it happen. Because we like to do so at scale, we work with you to build the systems to make this happen. It’s tough out there, don’t make it tougher. Let’s work together to take advantage of this period whilst it lasts so that when it fades, acceleration will be your norm.