Sales Blog with Sales Tips

Unintended consequences are things we don’t intend to happen. The federal government is infamous for this.

An example. The federal Cash for Clunkers program resulted in a net increase in car sales of only 125,000 cars – at a cost to US taxpayers of $24,000 per vehicle (see Further sales tips reading below).

I don’t mean to pick on the federal government (well, maybe a little bit), but the truth is that unintended consequences occur in all areas of our lives. They also, as you have already guessed, occur in sales.

Unintended Consequences In Sales Are Accidental, But Avoidable
We’ve all seen salespeople heading toward a customer three-car pileup with the best of intentions. You might see the danger ahead, but they’re completely unaware of what lies in front of them.

While they don’t mean to blunder, they could have avoided the unwanted problems by thinking ahead. By projecting where their current course of action is leading and consulting with the more senior members of their team for advice, a customer car wreck might be averted.

6 Common Unintended Consequences In Sales

1. Overdoing the “friendly” part of sales can frequently backfire on us. Customers hate disingenuous people. Customers realize you don’t care about them that much.

2. Asking prospects intensive qualifying questions can put them on the defensive. No one likes being backed into a corner. This occurs so frequently that I’m planning on writing a sales tips post about it in the upcoming weeks.

3. In order not to offend customers, we frequently don’t introduce additional products and services to them. “This customer is buying $35,000 per month from me of product X; I don’t want to rock the boat by pushing for more.” This guarantees they will be looking at your competitors to find other products that you’re afraid to sell them because it might be offensive.

4. Pushing for a close is so 1950’s. Again, no one likes being backed into a corner. When this happens, customers bring out the heavy artillery loaded with plenty of objection bullets.

5. Don’t most of us already know that talking badly about the competition always cheapens us and ironically gives more credibility to our competitors?

6. Selling to a non-decision-maker (e.g. recommender, information gatherer) makes us feel good because it’s easy and we feel we’re making real progress. Nothing could be further from the truth. We’re in fact wasting our time and alienating the real decision makers because: a) They don’t think we’re smart enough to figure out who the real DM’s are, and b) They think we perceive them as unimportant.

Sales Tips Wrap Up
I’ve identified six of the most common unintended consequences in sales. Believe me, there are a million more. Unintended consequences are costly to us. They are preventable if we take the time to stop and think where we are heading and frequently collaborate with the more experienced members on our team.

Further sales tips reading:
Cash for Clunkers Results Finally In

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>©2010 Scott R. Sheaffer

Scott Sheaffer’s New Book, “Comatose Management”
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Six Short Stories of Destructive Management Practices, Volume I
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Available in printed and Kindle edition on amazon.com
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—

Sales forecasting is the curse of every sales professional. It’s an art and a science that we all struggle with.

Why Our Sales Forecasts Frequently Miss The Mark

• We feel forced to tell our sales managers what they want to hear.
• In our desire for more sales, we operate from a position of baseless confidence.
• We don’t understand our industry.
• We aren’t properly qualifying our prospects.
• To create the illusion of a full funnel, we hang on to dead prospects ad infinitum.
• We don’t develop our skills at reading a prospect’s buying/not-buying signals.

Sales Tips For Sharpening Your Sales Forecasting Pencil
1. Re-qualify them. Don’t be afraid to re-qualify prospects in the middle of a sales cycle. It’s a good idea to constantly check the cards your fellow gamblers are showing when betting in Vegas.

2. Understand the steps of your sales process. If your company doesn’t have a defined and effective sales process, create one of your own. This will act as a benchmark.

3. Get real. Look at your normal closing ratio and apply it to the prospects in your pipeline. After you do that, reduce it by 25% to take into account all the unexpected delays, budget problems and competitive moves you’ll undoubtedly encounter.

4. Look for signs of commitment from the identified decision makers. If there is not a shred of skin in the game from them, then let them die a natural death. Remove them from your funnel.

5. Know your industry. It’s hard to anticipate buyers’ next moves when we don’t know their game.

6. Be sensitive to the vibes your prospects are sending out. Once we establish a relationship with them, they rarely tell us when they are unequivocally no longer interested. We have to be sensitive to their vibe or meta-message. The biggest mistake I see here is when sales professionals don’t make eye contact with prospects. A prospect’s eyes rarely lie.

Sales Tips Wrap Up
Forecasting is an important part of being a sales professional. Your employer doesn’t want you to overestimate or underestimate the business you’ll be bringing in. Your proficiency at this art and science will enhance your credibility with your sales manager and within your organization.

Further sales tips reading:
4 Sales Tips For Managing Your Pipeline
Are You Asking This Powerful Qualifying Question?
3 Reasons You Need A Sales Process

>You can automatically receive Sales Tips Blog by Scott R. Sheaffer >by email< or >by RSS<.
>Follow >Scott R. Sheaffer< on Facebook, LinkedIn or Twitter.
>©2010 Scott R. Sheaffer

Scott Sheaffer’s New Book, “Comatose Management”
—
Six Short Stories of Destructive Management Practices, Volume I
—
Available in printed and Kindle edition on amazon.com
—
—

I have to admit that I’m a skeptic. I don’t give much weight to palm readers and crystal ball types.

Sales is no different for me. There really is no “magic” when it comes to sales superstars. There is always a formula for their success. Always.

I’m going to share a piece of their “abracadabra” below.

But First…
Before I write any further, I’d like to bring your attention to a new addition to my sales tips blog, Scott’s Inbox. It provides a video venue for me to answer readers’ questions. You may have noticed that I started including these a few weeks ago.  Just click on my photo to start today’s 1 minute video.

Today’s Scott’s Inbox is a little different because I’ll be introducing you to my best friend and sales tips consultant. You may be a bit surprised who it is. I’ve mentioned him a few times before in this sales blog.

Back To The Abracadabra Thing
Why is it that rainmakers (i.e. sales superstars) have such high close rates and always seem to be in the right place at the right time? Is it magic? Hardly.

Rainmakers know when they call on a prospect company that the decision maker will be in one of four situations:

1. The decision maker has just had a new hand dealt to him or her that is disruptive. It could be a budget change, need for a new product or service, time frame change, etc.

2. The decision maker is unhappy with the performance of his or her current supplier(s). We all know there are a million reasons this can happen.

3. The decision maker has recently changed. When this happens, we know this is a golden window of opportunity.

4. The decision maker is happy with the status quo.

How To Make It Work For You
To ascertain which of the above four states the decision maker is currently in is the challenge. You have to find out where he or she is coming from within the first 30 seconds of your call. If you can place them in category 1, 2 or 3, the decision maker will have a reason to give you more time. You’ll also accurately know where to direct the conversation.

Every industry will have different questions that can be asked to identify which category fits the decision maker you’re talking to. These are normally closed-ended types of questions. You already have this list, right?

I constantly preach about researching prospects before contacting them the first time. One of the best tools for this is Google Alerts (see Further sales tips reading below). It’s a perfect tool because it alerts you to new information about a company just as it is happening.

Sales Tips Wrap Up
However, nothing is free. For this to help you reach rainmaker status, you’ll have to spend time developing your cold calling skills. You’ll need a razor sharp set of qualifying questions that are tailored to the prospect. You’ll have to research your prospects before calling.

However, the payoff will be huge. Some studies suggest a 5X improvement in closing rates. Abracadabra.

Further sales tips reading:
A Powerful Sales Tool You’ll Use Every Day – And It’s Free
7 Sales Tips For Getting To Decision Makers

>You can automatically receive Sales Tips Blog by Scott R. Sheaffer >by email< or >by RSS<.
>Follow >Scott R. Sheaffer< on Facebook, LinkedIn or Twitter.
>©2010 Scott R. Sheaffer

Scott Sheaffer’s New Book, “Comatose Management”
—
Six Short Stories of Destructive Management Practices, Volume I
—
Available in printed and Kindle edition on amazon.com
—
—

I believe we have completely lost our way on which KPI’s (Key Performance Indicators, i.e. metrics) are important when measuring our performance in developing new business. I’m going to introduce a KPI today that cuts through the fog.

First, Some Not-So-Fun Facts
The following three numbers will come as no surprise to experienced sales professionals.

Only 3-4% of voicemails left by salespersons for prospects are returned.

Only 1% of phone contacts with prospects culminate in a sale.

Only 3-5% of direct (i.e. on-site) prospect contacts result in a sale.

It’s Broken
Everyone who does any volume of prospecting knows how ineffective conventional cold calling is. We don’t even like to talk about it. Sales managers assign new account goals knowing what they’re doing is really assigning a task, not a goal.

The problem is that sales managers and sales professionals aren’t paying attention to the yield they are getting on their new business development efforts. “Prospecting Yield” is a simple and accurate indicator of prospecting effectiveness.

Prospecting Yield Defined

Prospecting Yield = Total Revenue Generated ÷ Number of Prospects Contacted

The resultant number will tell us what the average revenue is for each of our prospecting contacts for a defined period. A high Prospecting Yield indicates higher efficiency in the prospecting process.

There are a number of common variables missing in the simple formula above. The missing variables tell us everything we need to know about why Prospecting Yield is a useful and important number.

The Missing Variables
Close Ratio. Who cares what our close ratio is if our average order size is a nickel? This number is worthless.

Average Order Size. Average order size only tracks the prospects that ordered. Scenario One: A salesperson makes 1,000 new business contacts and closes two orders with an average order size of $2,000. Scenario Two: A second salesperson also write two orders with an average order size of $2,000 but does so by making only 50 contacts. The yield (or efficiency) of the second sales professional is twenty times that of the first.

Number of Orders.While any smart sales manager doesn’t want to see members of his or her sales force get the majority of their business from a handful of orders, 200 orders that average a couple of dollars each aren’t going to get anyone promoted.

The Wrong Focus
Sales management and sales professionals are guilty of viewing the process of new business development as the end game, the goal, the task to be completed.

It becomes a feel-good exercise of activity. Since most of us have concluded that conventional cold calling doesn’t really work, we focus on the mechanics instead.

Sales Blog Rx
The following is a prescription for prospecting success. It also will shine light on the true effectiveness of a business development program.

Stop seeing only the nuts and bolts of prospecting; the goal of prospecting is revenue – i.e. nice-sized orders.

Use Prospecting Yield to measure prospecting performance. Note: This KPI is increasingly more accurate as the number of contacted prospects grows.

Create a standardized prospecting process that uses best practices that have been learned from the rainmakers.

Sales Blog Epilogue
We have to realize that quality of prospecting, versus quantity, is what yields the highest results in 2009. Prospects want us to know about their company, their industry, their needs and even their points of pain before we initiate the first contact. Higher Prospecting Yields will mean fewer prospect contacts – but with much higher net results.

Further reading:
Prospecting By Going-Through-The-Motions, Part 2 of 4

>You can automatically receive Sales Tips Blog by Scott R. Sheaffer >by email< or >by RSS<.
>Follow >Scott R. Sheaffer< on Facebook, LinkedIn or Twitter.
>©2009 Scott R. Sheaffer

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