This newsletter is for founders and sales leaders who want to scale revenue faster.
I haven't sent an email since June (embarassing), but I trying to get these into your inbox once a week.
In this weeks issue:
- Selling is a Linear Process
- The Curse of Knowledge (a recent essay)
- Surround yourself with ambitious people
- How to Name Anything
Now onto this week's newsletter:
Sales is a Linear Process
The most effective way to sell a product or service is to start with the problem you are trying to solve.
If there is no problem to solve, there is nothing to motivate the prospect to make a change.
This was true 50 years ago. It's true today. It will be true 50 years from now.
People are selfish. That's OK, they should be selfish. The prospect only cares about themselves and what you can do for their business.
So when you are starting your sales process, always start with the most important problem that your prospect cares about.
This concept is very common in sales and advertising. It's is straight out of Breakthrough Advertising - you've heard me talk about the 5 stages of awareness if you have ever attended one of my training sessions or if you have been following this newsletter for a while.
When we sell, it's our job to move the prospect from "unaware" to "problem aware", and so on. You can't skip steps. You can't convince someone to buy a product before they are aware that they have a problem to begin with.
So many sales pitches fail because the salesperson wants to talk about how great their product is and explain all of the features. This is a fools errand if you are trying to pitch the product in your first conversation.
Instead, follow this linear process in your next sales conversation:
Start with the problem: What are the current challenges in the business?
Listen carefully for the problems that affect your prospect. This is how you convert that prospect into a champion (a super-important step).
Define the desired outcome: When that problem is solved, what outcomes will the business experience? What outcomes will your champion personally experience?
When we clearly define the problem, we can clearly define what life looks like when that problem is solved.
People buy for emotional reasons, but they justify their purchases with rational reasons.
So in your first conversation or two, the only job is to clearly define the current challenges and desired outcomes.
Outline why your product is the right fit: What are the features that solve the prospects challenges and deliver the desired outcome?
Make sure to ONLY focus on the features and functions that are aligned with the problem and desired outcome.
Concise product demos are more effective than a full-on training session for your product. This becomes much easier when you are deliberate about defining current challenges and what success looks like for the customer.
State the commercial terms (keep it simple): How much does it cost? What kind of commitment should the customer expect? What is the timeline to make a decision?
This is a commercial conversation, so don't forget to review the commercial terms of the partnership. I've written before about pricing strategy, make sure your pricing is easy to understand and directly relates tot he outcomes for the business.
Review the expected ROI: If the prospect makes this purchase, what are the economic returns (efficiency, cost savings, increased revenue, etc.) that they should expect to achieve?
Your champion should help you co-author this because they will be the one owning the conversation with their team. The ROI should have a 5x to 10x impact on the business relative to the investment that you are expecting them to make.
Remember that you are asking them to make an organizational change, which is much more expensive than the cash that you are charging them for your product or service. The hidden costs of buying your porduct are often the most expensive.
That's the simplest, most linear version of a sales process:
1. Current Challenges
2. Desired Outcomes
3. Why your company is the right partner
4. Commercial Terms
5. Expected ROI
The conversation should unfold in this order. It might take a few phone calls or meetings to get there, but be careful not to skip steps.
A few pro hints:
- when you have a new stakeholder entering the conversation (like the CFO or another executive), assume that they are in the "unaware" stage. Resist the urge to pick up the conversation where you left off with your champion. Slow down and take the time to confirm that they understand the problem and have a similar definition of success for the desired outcome.
- People forget things quickly. This is called the "forgetting curve". So use this process as an outline for your business case for the partnership, and put it into a document. I call this an Executive Summary. Your champion will use this to get the purchase approved within their organization. It's the most effective way to coach your champion through their evaluation process
- Your champion probably doesn't buy software very often, so you have to help them navigate their own dysfunctional organization. That's why the best sales reps use a Joint Execution Plan to show the champion exactly which steps are required to get to a final decision. This also makes it easy to set clear next steps with your champion throughout their evaluation process.
What's got my attention right now:
- I wrote an essay a while back on The Curse of Knowledge and didn't get a chance to send it to you. It's inspired by author Chip Heath and his book Made to Stick. The idea is simple: what seems easy or obvious to you is likely not so obvious to the people you are speaking with. Your experience and exposure to the specific thing that you work on every day puts you in a different category of understanding compared to the general population. Keep this in mind any time you are communicating about a subject you know very well. Slow down. Use simple language (as opposed to jargon). Repeat yourself often. That's how you get your message across.
- A few years ago a friend gifted me The 2-Hour Cocktail Party (Thanks, Jared!). I finally came around to reading it over the summer and I was inspired to put together my own get-together with interesting people.
I live in New Orleans, where there aren't many people who work in tech. I've often felt like I needed to get out of the city and visit New York, San Francisco, or Austin to find other like-minded people. But really this is just me being lazy and not putting in the effort to build my own network of good, smart, ambitious people right in my own city.
I like Paul Graham's essay The Anatomy of Determination where he describes the need for ambitious people to be around a similarly ambitious peer group:
"And fortunately ambition seems to be quite malleable; there's a lot you can do to increase it. Most people don't know how ambitious to be, especially when they're young. They don't know what's hard, or what they're capable of. And this problem is exacerbated by having few peers. Ambitious people are rare, so if everyone is mixed together randomly, as they tend to be early in people's lives, then the ambitious ones won't have many ambitious peers. When you take people like this and put them together with other ambitious people, they bloom like dying plants given water. Probably most ambitious people are starved for the sort of encouragement they'd get from ambitious peers, whatever their age."
So I held my first meeting. It was a coffee/breakfast meeting. About 20 people showed up across all types of businesses - tech, real estate, hospitality, energy, construction, aviation, etc.
There was so much energy in the room. Really glad I did it, will definitely do it again.
That's it for this week. One more ask before you go: Can you please forward this email to one person that might find it useful?
Have a great week!
Martin
Have a question? Hit reply and send it over, I reply to each one of your emails.