In this issue…
SALES
• Profiting Within the Customer Buying-Cycle
NEWS
• You really do get what you pay for
• Email marketing hits and misses
• SBA cuts will hurt small business
TRENDS
• Understanding the Boom-X market
TIPS
• Get new clients off to a strong start
• Dealing with a common problem in negotiations
• Find out how well your website is optimized for search engines
• Use “persona” marketing to develop marketing materials
• An easy way to get glowing customer testimonials
• Much more…
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SALES
Profiting Within the Customer Buying-Cycle
Trying to force buyers to shorten the buying cycle is almost always ineffective and can result in alienation.
ANY DISCUSSION OF customer buying-cycles is an unpopular topic with management, sales managers and salespeople. We all want to believe that by using the right words, making the right offer and displaying the right sales personality, just about any buying-cycle can be cut to one meeting. Whether they admit it or not, many a sales manager dreams of hiring “buying-cycle slashers.” In lieu of such a rare creature, they urge the sales force to do whatever’s necessary to shorten the cycle.
Trying to force buyers to shorten the cycle is almost always ineffective and, in some cases, results in alienation. The task for every company is to recognize the nature of the extended buying-cycle phenomenon and to use a strategy that leads to getting the order.
Here are components of a buying-cycle strategy:
1. Don’t quit too soon. This is the biggest mistake salespeople make when it comes to dealing with prospects. Salespeople get in their heads that someone is “just a tire kicker” or “all they wanted was to pick my brain.” Of course, that happens. But these are often the ones who say six months later, “After all the time I spent with them, they up and went with someone else.” After investing time and effort, salespeople often give up and move on, a tactic that opens the door wide for a competitor to walk through and get the order. Persistence and patience help to keep the door open.
2. Recognize that the sale is made before the final presentation is given. Promises of great service, a positive relationship and reliability don’t count with today’s customers. They want assurances. While testimonials and references can help, they pale in comparison to first-hand experience.
This is why the time between an initial contact and the customer saying “yes” can be the most crucial period in the entire sales process. A salesperson told me about a sale that took more than six months of discussing the issues and developing and refining the proposals. It was during this time that the salesperson was really being tested and it paid off. When the company president called and said, “We want to work with you,” the salesperson sensed a solid commitment in the prospect’s voice. “There was nothing tentative about it,” he reported. “He was firm.” Once satisfied, the decision was made. In other words, no one today wants to take chances. Being confident in making the right decision takes time.
3. Build the prospect database. There are those in sales who still describe selling as “a numbers game.” Just make enough calls and it’s payday. While this view of selling seems appealing, it’s nonsense. Each year, surveys show that about 75 percent of salespeople fail to “make their numbers.”
Allowing chance to be the primary component of the selling process is perhaps the most inefficient way to go about developing consistent sales. Instead, develop a profile of the desired type of customer and then identify prospects that fit the profile. Whether they come from salespeople, referrals or lists, they must be tested against the qualified prospect profile. Only certain fish get into the tank.
4. Develop a prospect relationship development strategy. A large regional insurance broker lists its top 50 prospects on a display board in its meeting room. Every week, the sales manager reviews each one with the agency’s producer team. This is prospect relationship development and it’s the heart of the sales process. It’s not about software as such; it’s about constantly focusing on one simple but critical question: “Who’s going to do what to whom and when?” In other words, where are we and what’s the next step? Prospect relationship development is about getting inside the customer’s head and staying there until the moment of readiness arrives.
5. Create testing opportunities. Internet sales continue to grow and companies that meet customer expectations get more business. Not surprisingly, eBay and Amazon.com lead the pack by demonstrating consistent performance. When making a purchase on the Internet, we’re quick to evaluate the quality of the service. Was there good communication? Did they do what they said they would do? Was the delivery efficient? In other words, we “test” sellers to see if they deserve additional business.
Giving customers similar testing opportunities can create confidence if the performance lives up to the expectations. Before asking them to make a major commitment, give customers several smaller occasions that together communicate the message that your company can deliver on its promises.
6. Never stop working. After trying all the gimmicks, it’s easy to conclude that nothing really works. What does work is persistence in staying close to prospects using a constellation of tactics that include personalized communications, seminars, solution-centered newsletters, informational e-bulletins, relevant advertising and public relations activities that are designed to connect with prospect needs.
Whether a company’s prospects are consumers or businesses, there is a similar “buyer mentality” that includes these qualities: 1) Everyone wants to feel in charge of the sale; 2) No one wants to be rushed; and 3) Everyone wants to make the right decision.
Selling today isn’t just about making calls or trying to psych-out prospects to find their “hot buttons.” It’s about creating an environment that gives them an opportunity to discover, evaluate and appreciate the value that a company or business can bring to them. That takes a commitment to be persistent. All of this suggests that it’s essential to give close attention to both understanding a prospect’s buying-cycle and to use it as a way to create an environment that ultimately results in the sale.
John R. Graham is president of Graham Communications (www.grahamcomm.com), a marketing services and sales consulting firm. He is the author of The New Magnet Marketing and Break the Rules Selling. He can be contacted at (617) 328-0069 or j_graham@grahamcomm.com.
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NEWS
You really do get what you pay for
If two brands of aspirin are side-by-side on a store shelf and one is on sale for 25% off, the customer will most likely select the discounted one. However, the fact that a product is discounted may make it work less well for the customer. Recent research at Stanford Graduate School of Business found that marketing actions, such as pricing and advertising, can actually alter the efficacy of products.
It has long been known that consumers’ beliefs and expectations influence their judgment of products and services. Consumers often judge lower-priced items to be of lower quality. What makes this new study different is that it shows marketing actions can go so far as to create “placebo effects” regarding product effectiveness.
In three different studies, participants were given energy drinks that supposedly make consumers feel more alert and energetic. Some participants paid full price for the drinks; others paid a discounted price. They were then asked to solve a series of word puzzles. The people who paid discounted prices consistently solved fewer puzzles than the people who paid full price for the drinks. The people had no idea that price was actually influencing their performance, signaling that this was largely a non-conscious effect.
Advertising also can impact the effectiveness of a product. For example, promoting the efficacy of a medication can have significant improvements to a consumer’s health. Advertising, if done well, can give rise to a positive placebo effect.
Source: Stanford Knowledgebase, Jan. 2006
Email marketing hits and misses
Consumers request plenty of product information by email. Unfortunately, many do not get what they ask for.
According to a Harris Interactive Poll compiled by Quris, although 77% of consumers report wanting to receive special offers from select companies, only 8% report receiving them. Moreover, 69% report wanting to receive regular updates on products and sales specials; however, only 19% are receiving these types of email communications.
On the other hand, a majority of respondents said that permission email is doing a good job of providing other wanted information, such as shipping and transaction information, as well as electronic statements.
As a result, consider combining service and marketing messages into one email, providing service information first and then targeting receptive customers with relevant offers within those messages.
Source: eMarketer, Jan. 17, 2006
SBA cuts will hurt small business
Small firms will feel the pinch this year from federal budget cuts at the Small Business Administration, a situation that is expected to worsen in 2007.
Loan guarantees will be pricier and other aid will be harder to get. Borrowers and lenders in the 7(a) guarantee program will face higher fees by fall. Beginning in April, the SBA will back only 50% of 7(a) loan amounts, down from 80% now. In addition, small contractors will soon pay more for the surety bonds they need under and SBA program that guarantees the bonds. Premiums for bonding will rise in April, after the SBA increases its fees for surety companies by more than 50%.
Equity capital will be scarce. The program that funded Small Business Investment Companies – private firms the SBA licenses to invest in start-ups or small-firm expansions in exchange for a piece of the company – was eliminated by Congress. Existing SBICs can still operate, but they’ll likely run out of capital by 2012.
Unfortunately, more cuts are likely. President Bush is expected to propose killing the SBA’s MicroLoan and Small Business Innovation Research programs when he submits his next budget.
Source: Kiplinger Forecasts, Dec. 30, 2005
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TRENDS
Understanding the Boom-X market
The Baby Boom generation is typically defined by a period of high birth rates, but this isn’t really a helpful way to predict the attitudes and behavior of this market. After all, the world view of younger baby boomers may not be as hopeful and confident as their protest-marching, idealistic, older siblings. In fact, it’s thought to be more accurate to place younger boomers with the older end of Generation X regarding a common culture.
So what defines this group of 35- to 54-year-olds that could be called the Boom-X market? For one, they spend a lot of money, but they spend it carefully. This group is feeling the pressures of raising families and worrying about their financial futures. But rather than reining in spending, they want to spend more. They need to indulge themselves a bit, as if thinking, “If not now, when?”
They want to get a deal and feel smart, but not be taken on quality. They may prefer the Kirkland cashmere sweater from Costco instead of a designer name. They’re also willing to pay more for products that perfectly meet their needs, so offering highly differentiated options should pay off.
Finally, they are very concerned with fitness and well-being, but this has more to do with health than narcissism. They do not want to be defined in terms of how old they are, but, instead, by their attitudes and education, health and wellness, adventure and excitement.
Source: Advertising Age, Jan. 2, 2006
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TIPS
- Get new clients off to a strong start with a “new client kit.” Once a client says “yes,” have a crystal clear process in place to teach them how to get the most from your relationship. The kit might include pages that explain: what to expect from us next, how to contact us if you have a question, how to get the most from your new product/service, what we need from you to get started, what we agreed upon today, how we invoice our work and a copy of our invoice. Having a system in place that communicates crucial information demonstrates a high level of professionalism and lessens the possibility of failing to meet initial expectations.
Source: www.ducttapemarketing.com
- In highly complex negotiations, some opponents might “forget” concessions they made earlier in the process. Help them remember by writing down any agreements as you go along. Before you start negotiating, say “I’m writing down the points as we decide them so I won’t forget. I think that will save us time later on.” Then each time you agree on something, say “Hold on. Let me jot that down. We’ve agreed that you will do X and I will do Y. Did I get that right?” By asking your opponent to take part by approving what you’re writing, it’s tough for them to forget or disagree with details later on. It also suggests that you’re trying to work with – instead of against – them.
Source: www.briefings.com
- How well is your website optimized for search engines? Find out at www.linkvendor.com. This site offers an extensive list of free tools to measure link value, domain popularity, Google page rank, keyword density and more. It even has a “SEO Challenge” that allows you to compare your website against a competitor’s to see whose site is better optimized.
- When pursuing big companies, most sellers want to ensure that decision makers know the full range of solutions that they provide. Proudly, they brag that they provide customers with “one-stop shopping” or that they can “handle all your ____ needs.” They hope prospects will be impressed with their vast capabilities, or that maybe something – one thing – will interest the decision maker. However, according to sales strategist Jill Konrath, this approach can backfire. Corporate decision makers today don’t want to deal with the “jack of all trades.” Instead, they prefer dealing with experts who really understand their business and needs. When you dump your entire offering on them, you’re not connecting with any urgent or compelling business need. With no focus, there’s nothing there for prospects to grab on to. Use a foot-in-the-door strategy that revolves around only one subset of your entire offering. Once they’re a client, you can present your other products and services.
Source: www.sellingtobigcompanies.com
- Hire recruits that are a good fit for your company by determining what kind of work environment they find motivating. Ask the following questions: Describe the work environment or culture in which you are most productive and happy; What goals, including career goals, have you set for your life?; How would you define “success” for your career? At the end of your work life, what must have been present for you to feel as if you had a successful career?; Describe a work situation that demonstrates how you motivated another person.
Source: Manager’s Edge, 1101 King St., Alexandria, VA 22314
- Get glowing testimonials from customers – even if you are too shy to ask for them directly. An easy way to collect testimonials is to create a customer satisfaction survey and include a space for comments. Be sure to ask “May we use your name and comments in our marketing materials?” Include a space for them to check “yes” or “no,” along with their signature. Most people are delighted to have you use their comments.
Source: www.businessknowhow.com
- Use “persona” marketing to develop marketing materials around your customers’ personalities. This technique was originally used by top Web designers, but can effectively help in all areas of marketing. Persona-based Web design means the Web team creates detailed profiles of fictionalized typical users. The profiles, which include a headshot, psychographic and demographic data, guide everything from copy to navigation to graphics so the site appeals to real individuals instead of missing the mark by trying to appeal to an averaged mass. Personas help you create marketing materials that are relevant at the gut level for prospects. However, it requires you to have an intimate understanding of your market.
Source: www.marketingsherpa.com
- Need to rally the troops to get through a slump? Watch the language you use. If your idea of inspiration is to gather your team and tell them “Now’s the time to pull together, folks, or we could go out of business,” think again. Vague, panic-ridden language only heightens employee anxiety without providing clear suggestions for how to cope. Instead, engage them by asking for their suggestions for what to do during the slow period in order to pave the way to future growth.
Source: www.roundpeg.biz
- Make a powerful impression on trade show contacts by following up with a customized e-newsletter. This helps establish your credibility as a leader in your field and makes prospects more receptive to follow-up calls. Segment your list into categories: customers, prospects and potential partners – each will get a different version of the e-newsletter. Begin each one with a personal note that continues the conversation started at the show. The rest of the newsletter provides targeted content that explains how your company can help the recipient and includes links to relevant articles in industry publications.
Source: www.clickz.com
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