This video is about 3 sales lessons that I have learnt running 5 businesses over the last 15 years as an entrepreneur and chief salesman. I thought I was good at sales when I first set up my own company. I was not. I had a lot to learn.
Sales is about getting in front of the right people, regularly engaging with people and keeping yourself in a positive, curious, interested mental state.
The 3 Keys to Effective Sales
In this video I share 3 keys:
Is the M.A.N. in the room? (MAN=Money + Authority + Need).
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How to Improve your Sales Process (4 Personal Habits to Develop)
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There is a classic sales interview question where the interview pushes a pen towards the interviewee and says “sell me this pen.” You might have seen the question in the movie The Wolf of Wall Street.
How do you Sell a Pen?
Don’t start with the pen.
Start with the person in front of you.
Do they need a pen? “Are you in the market for a pen?” If not: go find someone else who needs a pen.
Can they afford the pen? “What’s your price range?” If not: go find someone else who needs a pen and can afford one.
Can they make the decision now? “Are you looking to leave today with a pen?” If not: go find someone else who needs a pen, can afford one and has the authority to make the purchase.
Don’t push pens at people. “This is a great pen”, “This lasts longer than other pens”, “This is a better colour than our competition”… all nonsense if the person in front of you is not interested in a new pen.
How to sell a Pen
Find people who need pens, can afford them and can decide today.
I spent over 10 years building entrepreneurial ventures that had a lot of selling involved (insurance, business services, restaurant franchises, aeroplanes).
Fish Where the Fish Are
I met a young entrepreneur last week at Startupbootcamp. He told me “I am not good at sales”. I said “What do you mean?”. He said that he can’t seem to keep prospects interested. I asked him how he selected his target prospects. He returned a blank stare.
I said “do you try to sell to everyone you meet?”
He didn’t say anything but the body language was saying “well, yes of course”
This is how to die young as a salesperson.
My daughter loves fishing. To be honest, she loves the idea that she has of fishing, rather than the reality of fishing. We have a small cottage by the beach in Costa Brava and often we will go and spend some time “fishing”. I don’t really want to catch anything, I just want to chill out with her while we watch the sea and the sun setting and the changes of nature. She wants to catch fish.
If I want to catch fish I go to one place. If I don’t fancy cleaning and gutting a fish, I go to other places.
The place where I go to fish is the place where the fish are.
The place where I go to not fish, is any place that the fish are not.
Fishing Well, Selling Well
Fish wisely: “Fish where the fish are” – not randomly, or where you would like to be.
Selling to a person who is not the M.A.N. is a waste of breath. M is money, A is authority and N is need. If the MAN is not in the room, be polite and leave.
Who are your best clients? Where can you find more? Target well.
In my aviation business we discovered that the people that were most happy to regularly meet were often competitors interested in learning about our business (and copying our brochures, contracts and process). We learnt to be very careful and take time to bring prospects through a long (2-4 months) process before we would actually pitch the deal and put a contract in front of them. It made a real difference – not only in more effective sales, but in a major improvement in my personal motivation and enjoyment of the sales process. Photo Credit: Nicolas Valentin
Over the last 10 years I have increasingly moved from product businesses towards a services business.
In the world of private jets we had simple rules: if the trip is not paid, the plane doesn’t leave. It was policy, not decision.
In the world of coaching leaders to build cultures of disciplined high performance, there is often a wide grey area between free discussion and paid consulting. I find it very difficult to mark that line clearly. I love talking about psychology and high performance and getting the best out of people. I am interested.
My landlord only accepts money for rent. Not good intention. So I have to do the same myself.
6 Steps to Stop Being “Free”
Be clear on the results you can help them achieve – Can you explain what success looks like in a clear, concise, specific and compelling way? in language that your target customers can really understand?
Show testimonials, examples, logos of past successes – capture testimonials and make them as specific as possilble
Find common passions or interests (liking) – build relationships that are broader than pure business
Respect yourself – know where you draw your line (Let the prospective client know that you are the most capable, dedicated and solution-oriented consultant they will find and that you normally charge X-amount for your time.)
Blog, write, speak, publish – direct your potential client there rather than give custom answers – thought leadership is free, customising the advice for a specific person and access to you should be expensive
Ask for the sale – Make yourself a product, set clear prices – and ask for the sale. “Look, I think you value my advice – lets set up a 6 month deal – two meetings per month for €XX”
More on the fine line between free and paid consulting
I teach communication skills. I help entrepreneurs deal with leadership challenges. I find it hard to effectively manage the gap between free advice and paid consulting.
“Would you listen to my speech?”
or “Can we meet for a coffee, I have an important meeting coming up?”
I find it hard to do the “American Lawyer” mode – bring a clock and start timing the conversation as soon as I talk about communications.
I like the little conversations, but I am conflicted about how to set some limits.
How do you set limits on your service?
Are you a coach – how do you distinguish between “free advice to friends” and “professional services”? How do you have the conversation when someone assumes that they should get your help for free (and you’re not so sure)?
…And The Overly Complicated Sales Cycle
The other area that I have challenges is keeping the sales process under control.
I have a Swiss client that calls me, says they need a specific date, signs the contract and pays. Minimal admin. Zero hassle.
I had a Spanish client that asked me to come back and explain my services 11 times before signing the contract. I would not have done the 2nd meeting if I had known that there were 9 more to come.
Sales is not about describing your product, your process or your friends. It is about explaining to the buyer a problem that they have, and giving them a glimpse of a world where that problem has gone away.
What would it feel like to live in a world where that problem has gone away? What would it feel like to have your boss think you are a top performer? What would it feel like to have your kids proud of you? What would it feel like to see your body looking fit? What would it feel like to take your t-shirt off at the beach with pride?
What is your painful problem to solve?
By the way, you don’t get to talk to someone about their problem until you have a relationship of trust with that person. You can’t just dive in and say “we’ll make your pain go away!”. You have to begin a relationship of trust.
The best first step? Generosity. What can you give this person that they need? Often, it is your undivided, non-judgemental listening to what they have to say. Make them feel like they truly exist for you.
Rory Sutherland tells some wonderful stories about the power of framing. If you want to be persuasive, you must get good at framing the argument. Good framing shifts the argument to a playing field where you can achieve your ends and the other can feel that they have gotten a good deal.
Prices are not expensive or inexpensive in abstract, only in relative terms. If I say that “this watch costs €100” – I have allowed you to frame your perspective on expensive or cheap. If I say “other watches in this very category sell for over €1,000; this watch costs €100” – I have started to provide my own framing for the situation.
Compared to what?
Rory talks about small shifts in framing have a powerful impact. He gives the example from car sales that it is far better to give a rebate of €3000 on top of trade in valuation versus giving €3000 off the full purchase price. The framing of a trade-in price of €7000 plus €3000 is much more impactful than offering €3000 reduction on the full price of €22,000. It is the same €3000 in cash, but it is not the same €3000 from a psychological point of view.
This framing also works for selling expensive cars at plane and boat shows – context shifts way we see the price. A €300,000 car seems expensive when seen in a showroom of €50,000 cars… but it feels more reasonable when placed next to €1.2M boats or €6M private jets.
I came across this paragraph in a blog post by sales professional Grant Cardone.
“No one buys a $57,000 watch to tell time. People buy things to solve problems. The cost of the item isn’t what matters. Once the buyer is able to see the problem the product solves, their decision becomes much easier to resolve. Get to the “why” and the sale will follow.” Grant Cardone (original article at Entrepreneur magazine)
How do you get someone to buy something that they do not need?
Just as nobody really buys a $57,000 watch to solve the problem of “what time is it”, nobody does an expensive MBA just because they want to know more about business. Nobody hires an expensive consultant just because they need to finish a simple project. Nobody hires an expensive coach just because they need help with discipline.
Cheap watches tell the time. Cheap MBAs teach you about business. Cheap consultants can get projects finished. Cheap coaches can help you with discipline.
A casio watch can be bought for €2.99. It tells the time as well as the $57,000 watch. Why are they different? The casio watch has 8 functions. The $57,000 watch tells the time, and the date. The casio watch allows me to change the time. The $57,000 watch requires a trained technician to move the clock forward an hour.
Why does someone pay the $56,997.01 difference (and get less functionality)?
There is something else we are buying when we buy.
“Bread and Water. Everything else is marketing.” Tony Anagor
I did an interview with Tony Anagor, one of the coaches who works with my Leadership Communications courses at IESE Business School. Tony said “Bread and water. Everything else is marketing.”
What did he mean?
Once I have food and shelter, I can survive. I don’t need anything else to survive. I want other things, but I don’t need them.
If I say “I need friends, I would die without my friends”: it is not literally true. I want friends. They make my life worth living. They add to my life. They are not needs in the way of food and shelter. I wouldn’t value highly a lonely life, without friends.
If I say “I need an iPad. All of my friends have an iPad.”: not true. I really, really want an iPad. However, the reason that I want it is the important thing for a salesman to find. Why do I so need an iPad?
I want it because it might remove the anguish of feeling left out. I want it because it might give me a sense of importance in having an “in-demand” item. I want it because I like playing with new technology. I want it because my friends are playing some online game and I am less connected because I am not involved.