Sales and Sales Management Blog

February 25, 2013

Building Your Business on Referrals Pt 3: You Don’t Need Referrals, You Need Introductions

How often as a B2B seller have you been advised to ask your client for referrals?  If your experience is typical then you’ve heard that advice just about every time you turn around.

Most of us have had it pounded into our heads that we need to ask for referrals after the sale has been completed. We just need to do a good job for our client and then, after the sale, ask them if they know of anyone who could benefit from our products or services and we’ll easily and rapidly grow our business.

Depending upon the seller you ask, that referral question can take many different forms, such as:

“Ms. Client, who do you know that could use my products or services?”

“Mr. Client, who do you know that I should be talking to?”

“Mr. Client, who else do you know that I could help?”

“Ms. Client, if you happen to run across anyone else that I might be able to help, would you give them one of my cards?”

But no matter the specific language of the question we’ve been taught to ask, almost all of them have the same root problem that results in our receiving few high quality referrals: all of the questions most of us have been taught to ask require our client to do our work for us.

In virtually every case we are asking our client to come up with the name of someone they know who they believe could use our services—even though our client really doesn’t know who is a really strong prospect for us; even though our client doesn’t know all of our capabilities; and we’ve put them on the spot asking them to come up with a great referral for us with only a few seconds to think about it.

Not surprisingly most of the “referrals” we get—usually nothing more than the name and phone number—prove to be no more qualified than if we had thrown darts at the phonebook and are, thus, nothing more than time wasters.  Certainly one here and there turns into a client—but for most of us the pickings are pretty slim.

So if asking your client for a referral to someone they know who might need your products or services doesn’t work very well, is it possible to get a large number of high quality referrals from clients?

Yes, absolutely it is.

But instead of asking a weak question like “who do you know that might be able to use my products or services,” it makes far more sense for us to do the hard work of finding out who our client can refer by figuring out who our client knows that we know is a great prospect for us and then asking for a direct introduction to that person.

This method demands more than simply popping off a question at the end of the sale trying to get your client to do your work, but it is powerful because:

  • You are making it so easy for your client to give a great referral that all they have to do is say “yes”
  • You have relieved your client of an uncomfortable and often unwanted burden
  • You are far more likely to get a positive response from your client because instead of asking them to rummage around their mental file cabinet trying to figure out who to refer, you’re asking for a specific and easy to fulfill action—an introduction to someone they know
  • The introduction you get will be to a quality prospect because it will be to a prospect that you pick and that you know you want to be introduced to
  • You will have a much greater chance of setting an appointment with the prospect by being personally introduced by your client than if you just get their name and phone number and call them out of the blue
  • Over time, you can get multiple high quality introductions from each client. They become a never ending source of quality referrals by simply asking for additional specific introductions as you earn them

By investing the time and effort to do the detective work necessary to discover who your client knows that you know you want to be referred to you are not only taking the burden off your client, you’re making it so easy for your client to give you a great referral that the only thing they have to do is say “yes” when you ask.

Instead of relying on your client to come up with a top referral you’re insuring that the introduction you receive is one that you want to receive.

The primary issue now becomes how to discover who your client knows that you know you want to be referred to.  That issue demands developing some detective talents such as keen observation, listening, and analytical skills—skills that will be covered in part 4 of this series on referrals.

In addition to being able to uncover great introductions that your client can give you, the question you ask naturally changes.  Instead of asking your client to come up with a name and phone number, your question will now be geared toward confirming that the client knows your intended prospect and then moves on to asking for the introduction.

Depending upon the circumstances the request could look very much like this:

You: “Don, I’ve been trying to reach Janet Smith over at XYZ Company for some time and haven’t been able to connect and it occurred to me that you might know her.  Do you know Janet?”  (Of course since you’ve done your homework you have good reason to believe he knows her.)

Client: “Sure, I know Janet. Why?”

You:  “Great.  Would you be comfortable introducing me to her?”

If you have done your job well and earned your client’s trust and respect, there is an extremely high probability your client will readily agree to introduce you to Janet.  Instead of asking your client to do your work for you all he has had to do was say “yes.”

Although this process is most easily implemented by B2B sellers, it also works well for B2C sellers in situations where the seller has the opportunity to know their client very well.

Rather than asking your client to rack their brain and do your prospecting for you—something they are ill prepared to do—take the time and put in the effort to do the work for your client and you’ll turn introductions from clients into a major source of your new business.

Referrals—rather direct introductions–can be the cornerstone of your sales business if you learn to do a little detective work and make it easy for your clients to give the great referrals you’ve always wanted.

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February 21, 2013

Building Your Business on Referrals Pt. 2: Asking for Referrals is Bad Practice

OK, I know, you’ve been told your entire life as a salesperson that you have to ask for referrals and that if you don’t you’ll fail.  But if you’re like most sellers you’ve asked and on occasion get a name and phone number of someone that turns into a new client, but most of the time the names and numbers you get are about as targeted as taking a dart and throwing blindly at the phone book.

The above situation is so common that a great many sellers simply stop asking, thinking that referrals are nothing more than sales mythology, while others, thinking they are the cause of the failure to generate significant numbers of quality referrals, continue to ask with little success and a growing sense of frustration and failure.

The reality isn’t that generating quality referrals are nothing more than a myth or that the seller himself is the root cause of referral generation failure.

Referral generation fails primarily because of the way most sellers have been taught to seek referrals.  The seller isn’t the problem; the strategy they’ve been taught is at fault.

How have most of us been taught to get referrals? 

For the most part out referral training consists of nothing more than “do a good job for your client and ask for referrals with a question such as, ‘Mr. Prospect, do you know anyone else who I might be able to help as I’ve helped you,’ or ‘Ms. Prospect, do you know of anyone who might benefit from my products or services?’

Certainly on occasion the training may be a bit more in-depth—one trainer might encourage sellers to ask the question early in the sale while another stresses the need to ask only after the sale has been completed, or one trainer might use slightly different phraseology or might encourage the seller to ask for a specific number of referrals, but the essence of the training is the same—do a good job and ask for referrals.

The problem is the process taught causes more problems than it solves.

First, the good news—the traditional referral training solves a major problem—it encourages the seller to seek referrals.  Although the success ratio is typically very low, it does produce the occasional prospect that turns into a client. 

Now the bad news—it fritters away one of the most valuable business generation resources a seller has—the potential quality referrals from a satisfied client.

Let’s take a look at the primary problems the traditional referral “method” creates:

  • The Referral Question Comes Out of the Blue:  Most clients are not comfortable when put on the spot to give referrals.  When we ask for a referral we may be thinking that we’re asking a small favor but most clients take the request far more seriously.  When a client gives a referral they believe they are putting their reputation on the line, something most don’t do lightly.  Clients need time to become comfortable with the idea of giving referrals.  If we really want quality referrals, we have to allow our client the time to become comfortable with the idea of giving us referrals before we ask.
  • We Don’t Give Our Client the Opportunity to Give Quality Referrals:  When we follow the traditional training of “do a good job and ask for referrals” we literally stand in front of our client (or are holding on the phone) expecting them to pop off the names of great prospects for us.  We are asking them to go through their mental file cabinet and come up with great referrals in the course of 10 or 15 seconds.  That is simply an unrealistic expectation on our part and we usually get what we deserve when we put a client in that position—little to nothing of value.
  • Our Client Doesn’t Know Who a Great Prospect for Us Is:  Not only do we expect our client to be able to give great referrals just off the top of their head, we expect them to know exactly who we can help when much of the time our client hasn’t had the opportunity to fully appreciate what we’ve done for them, much less know what all of our capabilities are and who is really a top prospect for us.  We’re asking our client to do the impossible—know our business as well as we know it.
  • It Ignores Human Nature:  The traditional referral request is one-sided and offers the client no reason to give referrals.  There are, obviously, clients who will give referrals even when there is nothing in it for them, but human nature being what it is, the referral request can be far more successful if it can be shown that it benefits the client as well as the seller.
  • It Makes the Client do the Work:  Rather than making it easy for our clients to give us great referrals, we make it as difficult as possible by asking them to do something they are ill prepared–and often not inclined–to do.  Giving high quality referrals should be so easy for our client that literally all they have to do is say “yes.”

Although referral generation as traditionally taught is laden with self-defeating issues, referral generation when practiced properly can be a highly successful business generation tool—one that can literally be the cornerstone of a successful business.

February 19, 2013

Building Your Business on Referrals Part 1: Understanding the 4 Pillars of a Successful Referral

At first glance, a referral is a pretty simple thing.  For most sellers, managers, and trainers, a referral is just a name and phone number that a client has given once the seller has completed the sale, has done a good job for the client, and then asks a general question such as, “do you know of anyone else that I might be able to help?,” or, “do you know of anyone else that might benefit from my products and services?”.

Once a seller has received a referral, contacting the referred party is just as simple.  The seller will call the referred party mentioning to him or her that the client, which the prospect knows, referred the seller to them, or on occasion they will ask the client to write a referral letter to the prospect and then the seller will call the prospect after they have received the letter.  A very simple, straightforward process.

Unfortunately, this “do a good job and ask for a referral” process is totally and completely wrong, and has been proven by millions of sellers to not work worth a darn.  Nevertheless, this is what is taught in almost every sales course that mentions referrals.  And not only is it a waste of time and effort, it deceives the seller who don’t succeed when using it into believing that the fault lies with him or her, not with a “system” that doesn’t work.

Generating a large number of high quality referrals requires far more than “doing a good job and asking for a referral.”

If you want to generate a large number of high quality referrals from your clients, you must understand what creates a quality referral.

A high quality referral is built on a foundation that has four solid pillars—and as the seller; you have control over three of them:

  1. Your relationship with your client:  Most clients don’t give referrals because they like you or even because you did a good job.  Certainly there are a few clients that will give referrals at the drop of a hat, but most clients hate to give referrals and unless they have a deep trust that you will not embarrass them and that you’ll deal honestly and competently with the prospect they refer, they won’t be willing to give quality referrals.Most clients believe that when they give a referral they’re not just suggesting that someone they know speak to the person they are referring, they believe that they are endorsing the seller, in essence telling the person they refer to the seller that they don’t need to do any research because the referrer has already done it and this person they’re referring is the best choice.  To get clients to take this step doesn’t come without having built a strong bond of trust.
  2. Your client’s purchasing experience: Discover what your client’s purchasing expectations and priorities are, then meet and, hopefully, exceed them.Few sellers ever exceed their client’s expectations because even though they think they know what the client’s expectations are, they never really try to find out, they never ask.  You cannot afford to guess or “think” you know what your client’s expectations are–you must know exactly, and you can only do that by discussing them with your client and then making sure you meet or exceed them–nothing less will do.If you don’t specifically ask your client what their expectations are, the best you can do is meet or exceed what you think your client’s expectations should be.Clients assume that anyone they refer you to will have a similar or WORSE purchasing experience than they had.  The further away from their desired purchasing experience they have, the less likely they will be to give a quality referral.
  3. The relationship between your client and the prospect:  This is the one pillar you have no control over.  Clients will refer you to people they have very strong, positive relationships with–and people they have very negative relationships with.  If the prospect trusts and respects your client, some of that trust and respect will be automatically imbued to you and you start your relationship with them from a position of strength.  On the other hand, if the prospect distrusts or doesn’t respect your client, some of that distrust or disrespect will also be imbued to you and you will start your relationship with them from a position of weakness.  Your job is to find out exactly what the relationship between client and prospect is and then plan you introduction approach to them accordingly.
  4. Your initial contact with the prospect:  To this point you’ve invested a great deal time and effort in establishing your relationship with your client, making sure they have exactly the purchasing experience they want, and finding out what the relationship is between your client and the prospect they are referring.  After investing so much time and attention to get this far, the last thing you want is just a name and phone number.  Instead of getting a traditional “referral” consisting of the name and phone number of the prospect and permission to use your client’s name, get a direct introduction from your client to the prospect.There are three primary methods of getting a direct introduction:

    Letter of introduction from your client to the prospect:  Ask your client to write a letter introducing you to the prospect.  However, once you’ve asked your client to write the letter, let them know that you know how busy they are and then offer to take the burden off of them by writing the letter for their signature.  If you allow them to write the letter it won’t communicate a reason for the prospect to meet with you and it will be written on their schedule—which could be never.The letter you write should give a brief overview of what you’ve done for your client and why the client believes it would be beneficial for the prospect to meet with you, as well as the time and date to expect a call from you.  Have your client sign it. Phone the prospect at the exact time your client indicated you’d be calling.

    Introductory phone call from your client to the prospect:  An even stronger introduction is a phone call from your client to the prospect to introduce you.  This method puts additional pressure on the prospect to agree to set an appointment with you as it is difficult for the prospect to say “no” to your meeting request when they know that their friend, co-worker, or associate is standing next to you when you ask.The downside to a phone call is it gives the prospect the opportunity to ask questions of your client. If there were aspects to the sale that didn’t go well there is a good chance they will surface during the phone call.

    Lunch meeting with your client, the prospect, and yourself:  A tremendously strong introduction method.  Have your client invite the prospect to lunch or coffee with the three of you. Encourage your client to let the prospect know this is NOT a sales meeting, just an opportunity for the two of you to meet one another.

    One of the strange things that often happens during the meeting is the client ends up being your salesperson and you are there simply as the consultant.  And, again, it is very difficult for the prospect to say “no” when you request a meeting.

As seen above, you have control of the majority of the pillars upon which a referral is based.  If any of the above is weak, your likelihood of generating quality referrals will decline and the weakness must be made up elsewhere.  In actuality, if one of the first two segments is weak, you will not be getting quality referrals–period.  However, you can mitigate the third one by using a strong method of introduction.

Generating a large number of quality sales isn’t done by chance or luck, and neither is generating a large number of high quality referrals.   Just as you need a well thought out process to consistently sell, you need a well thought out process to generate quality referrals.  You can significantly increase the volume and the success of your referrals if you understand the dynamics that generate quality referrals and then control those dynamics.

February 15, 2013

Guest Article: “The Successful Secrets of Exhibition Management,” by James Barnett

Filed under: Uncategorized — Paul McCord @ 10:10 am

 The Successful Secrets of Exhibition Management
by James Barnett

According to research from the Oxford Economics Facetime publication the Exhibitions Industry contributes £5.6 billion to the UK economy.  Exhibitions if marketed correctly can provide more business for your company then all other sales initiatives combined. An important statistic from Exhibition Industry Research (CEIR) states 88 per cent of exhibition visitors will not have been approached by a sales team in the last year. Therefore providing the right exhibition stand provides potential business for an organization.

There are a number of important elements to consider when putting together an exhibition. The exhibition team will need a strong sales force that can captivate an audience and demonstrate genuine enthusiasm for a product. Put in place a PR strategy that seeks to create excitement before, during, and after the show.  Digital media allows PR to become integrated within social channels; this can build relationships with customers and partnerships. Exhibition management is a crucial factor that will determine the outcome of an exhibit’s success, unless the exhibition is running effectively during the show the exhibition is unlikely to be a success. Top tips to succeed are outlined below.

1. Exhibition Planning. Think strategically in the planning process and ask yourself the following questions. Is your exhibition meeting the corporate strategy of the company? Does it meet the target audience and fit within the budget? Exhibitions often go wrong when they focus purely on the product demonstration but neglect the wider picture.  Plan against your objectives; not just for the moment.

2. Focus on the Detail. Exhibitions require a Microsoft Excel whiz that enjoys working with spread sheets. Each element of the show should be documented and later analyzed by the management team.  Form checklists and adhere to strict guidelines set out at the beginning of the show.

3. Savvy Marketing. Digital technology allows you to promote the event before, during, and after the show. A live brand experience provides excellent real-time exposure whilst the pre- and post-show marketing offers networking opportunities for your business.

4. Teamwork. The exhibition is a good opportunity to build team spirit and reward people for their efforts. Work on a shared bonus scheme and ensure you single out individuals for praise after producing good results. This could be a customer acquisition or a successful presentation.

5. Time Management.  Blink and you will miss it; an exhibition flies by whether you are busy selling or trying to get your exhibition on track.

Master the art of time management and the exhibition will become an enjoyable experience. Avoid procrastination at all times.

6. The Art of Negotiation. Research your customers and analyze their needs and wants. You should be able to connect with them on LinkedIn prior to the exhibit and gain an understanding of how your product will fulfill their business needs. Use your intuition, flexibility and concern to find a mutually beneficial agreement.

7. Positive Attitude. Success is surrounded by positive people with a can do attitude. Try using a vocabulary which reflects these thoughts and feelings and directs the conversation into a positive tone.  Exhibits often require performances from the sales staff and you should use your entrepreneurial skills to motivate staff. 

8. Evaluating Results. Create a system to analyze results by asking the public and staff for feedback on the show. Find out what they enjoyed from your display stand and what they wish to see improved.

9. Perpetual Learning. Embrace the information age and subscribe to influential blogs and industry resources which provide up to date tips. Analyze influential articles on exhibition management techniques and learn from these resources.

10. Keep Your Sense of Humor. Humor maintains sanity in challenging situations. Put things into perspective and learn to laugh at mistakes. This will reduce your stress levels and provide a relaxed environment for staff.   If a product demonstration goes wrong a relaxed approach will impress the audience more than ranting over the technology your company has developed. 

 

 James Barnett on behalf of Nimlok, providers of exhibition stand construction and design.

February 12, 2013

Book Review: How to Close a Deal Like Warren Buffett

Filed under: Book Reviews — Paul McCord @ 11:33 am
Tags: , , , ,

How To Close A Deal Like Warren BuffettKnowing a bit about how the man who is probably the most successful deal closer in modern history operates would be helpful whether you’re trying to buy a company, buy a car, or sell something.  Fortunately Tom Searcy and Henry Devries have given us as close a view of how Mr. Buffett operates as we could ever hope for in their new book How to Close a Deal Like Warren Buffett: Lessons From The World’s Greatest Dealmaker (McGraw Hill:  2013).

First and foremost Buffett argues you have to know what you’re doing because risk arises from not knowing what you’re doing.  That seems self-evident, but how often are deals attempted to be made where that simple rule hasn’t been followed?  And how many of us sellers have been guilty?

So, when it comes to deal making how you can become one of those who knows what they’re doing?  Searcy and Devries go into detail about the Buffett way of finding, analyzing, and closing deals.  Chapter after chapter lays out in simple rule format with accompanying case study the process and the axioms that Buffett follows to mitigate risk and to come as close as possible to assuring success in the deals he makes.

Since we can’t go into great detail in a short, simple review, let me give the seven opening rules or guidelines the authors gleaned from their study of Buffett’s strategy:

  1. 1.    Know the other guy’s money—knowing how the other person views money
  2. 2.    Know the other guy’s wallet—look at the deal from the other guy’s point of view and what impact it will have on him
  3. 3.    Start discussing the money early—gather the economics surrounding the deal
  4. 4.    Use ranges to qualify and disqualify—find out early if you and the other person are even in the same ballpark, i.e., there’s reality in the discussion
  5. 5.    Speak the language of investment and outcomes
  6. 6.    Don’t discount early
  7. 7.    Don’t negotiate until it’s time.

As the authors work through the various chapters and case studies the above rules come to life as you see them at work in Buffett’s deals—both those he consummated and those he walked away from.

A particularly useful and fascinating part of the book is Appendix A: 101 Warren Ways, a collection of 101 Buffett axioms.  These range from the simplistic “Avoid risky deals,” to rules that counter the actions of many modern dealmakers such as “Don’t think computers can do your thinking for you.”   And maybe the most important rule of all: “Don’t do deals just to do deals.”

Although written for those looking to make Buffett type of deals, How to Close a Deal Like Warren Buffett is equally valuable for the seller as sellers are working in the same often murky waters as those seeking to buy or sell companies.

February 8, 2013

You Have to Act the Part to Become the Part

Back in the days when Indians roamed the range, before leather helmets, when the Flying Wedge was all the rage, I played football in high school.  My high school team wasn’t all that great since I went to the new high school in town and the city fathers finagled it so that most of the good players went to the old, established school. 

We had a coach who would tell us that in order to become the player we wanted to be, we had to act the part to become the part—that is, we had to act like good football players in order to become good football players.

That small bit of advice has a tremendous amount of wisdom packed into it—and a lot of room for misinterpretation. 

First let me say what Coach didn’t mean—seems especially important in today’s culture.  Acting the part didn’t mean trash talking, acting like the school stud, or grandstanding.  He would never put up with someone putting on airs, demanding special treatment, or getting too big for their britches. 

Acting the part meant imitating the play of a quality player—doing those things that the good players do that make them good. 

Acting the part means forgetting that one might be relatively new or inexperienced or hasn’t mastered necessary skills

It means consciously forcing oneself to go through the same motions good players go through, using the same techniques and strategies, assuming the same confidence and self assurance (and faking it if necessary).

The philosophy behind Coach’s words is simply that you cannot become the person you want to be if you don’t do the things that person would do.

That small bit of advice works not only in sports but in all aspects of life, especially in selling.

Are you not the seller you want to be?  Are you new or haven’t produced in the past at the level you want?  Are you not one of the top sellers in your organization?  Are you not at the top of your industry?

You can be—but not unless you act the part of a top seller, doing the things top sellers do.

I have heard literally thousands of average or slightly above average—and especially below average–sellers claim that they want to sell their way rather than imitating the top people in their organization.  Some say they “can’t” sell the way the top sellers do, others that they know a better way.  Ultimately they all have the same thing in common—they never make it to the top level.

There are thousands who claim to be sales trainers and gurus, all ready and willing to give you the secrets of selling success for the right price.  And much of what they sell is really good and will help you increase your sales.  I’m not downplaying the role of a quality trainer—after all, I’m one. 

That being said, the quickest, surest way to becoming a top seller is to simply act like a top seller, doing the things a top seller does.  You’ll be surprised at how quickly the “act” becomes the reality.

 

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February 7, 2013

Guest Article: “How Much Interest Are You Paying on Your Debts?” by Chrissy Hoey

Filed under: Uncategorized — Paul McCord @ 12:10 pm

While struggeling with a very slow recovery, many sellers and small companies are trying to figure out how to maximize their dollars.  Maybe you’re overpaying on debt?  Here’s how to find out.

 

How much interest are you paying on your debts?
by Chrissy Hoey

It can be easy to get caught up in debt. Life is full of unexpected problems and things to pay for and loans and credit cards can be a great way to help with financial issues – but only temporarily.

With credit cards becoming easier and easier to obtain, more and more people are relying on them to pay for food and everyday items, often entering a seemingly never ending spiral of debt. The problem is that when your debt gets out of control, you end up accruing more and more interest, which it can seem impossible to ever catch up with.

Similarly, loans can be the only way of financing certain projects and obviously the longer it takes you to pay the loan back, the more interest you will pay. With any kind of debt repayment, if you miss a monthly repayment, you will also be charged a missed payment fee. Missing a payment only lengthens the amount of time it will take you to pay back your debt.

Credit cards have a minimum payment you need to meet each month, although this sum tends to be well below what you need to pay each month to clear your debt quickly. It is generally between 3% and 5% of your outstanding debt – you can check this with your credit card or loan provider. However, by only paying the minimum payment, you are in fact, accumulating more interest on your existing debt. As a result, it is important that you repay as much as you can each month and preferably more than the minimum payment.

Improving your financial circumstances

If you have a lot of debt and cannot afford to pay it back in one go, it can be helpful to try and work out how much you owe and the amount of time you need to or want to clear it in. Work out how much interest you will be charged for this period, add it to your debt, then divide this sum by the number of months you wish to clear your debt in. You will then have your monthly payment. If this is too much, or even too little, you can readjust the repayment period accordingly. You can use an interest calculator for this, which works out how long it will take you to clear your debt and how much interest you will pay for it.

It’s not all doom and gloom, however. There are measures you can take to get back on top of your debt and reduce the amount of interest you pay. For credit card debts, you can attempt to deal with this yourself by creating your own repayment plan. First, find a credit card provider which offers 0% APR on balance transfers for as long as possible and check that you are eligible for this kind of deal. Then transfer your credit card balance or balances to your new credit card. Most will charge a one-off fee for the transfer, which is likely to be a small percentage of the total sum. Factor this fee into your total debt on the new credit card, then divide this by the number of months the balance transfer deal is for – just set up a Direct Debit to leave your account every month.

Alternatively, if you find the prospect of dealing with such financial issues alone too daunting, you can turn to professionals for help. They will help you set up a debt management plan, by talking to your credit card or loan providers and consolidating all your debts into one plan, to ensure that you reach a more feasible monthly repayment.

 

Chrissy Hoey is with Baines and Ernst, a credit management company in the UK.

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