Having spent significant time on both sides of the sales equation, Mike Molson (Co-founder, servicePath) has cracked the code to staying out of the proverbial “sales doghouse”. We all know technology sales is complex and difficult. Product SKUs and pricing changes constantly. Decoding software/hardware interdependencies is like translating Latin. Staying on top of every client configuration is like riding a wild boar.
It’s not surprising that many software and technology sales managers find themselves in trouble with missed quotas, lost deals and underwhelming pipelines – proverbial doghouse. Molson, like most of us, has been there and didn’t like it one bit. Over the years, he has discovered a set of tactics and strategies that has kept him and his sales teams out of trouble. In this webinar, Molson shared ten tactics for staying out of the Sales Doghouse.
- Response time – In a perfect world, the customer received their quote right when they wanted it; i.e. yesterday. While it is not reasonable to expect such preternatural delivery, Mike says, and I quote, “we’re always behind the clock”; needless to say, the importance of being able to respond promptly cannot be stressed enough. Any typical sales process is inherently time consuming, so the trick is to A. convey, early-on, an indicative estimate to give the customer an idea of your understanding of their requirements and how you will be providing support B. identify and communicate the variations (in terms of capacity, performance, availability, redundancy etc.) that the customer may experience.
- Knowledge – Make sure you have a panoramic view of your customers’ purchases. While that is too much to ask of a human being, having a system in place, where all data pertinent to the customers’ relationship with your company is centralized, can prove to be very helpful. This information will likely help you, the sales professional, formulate reselling opportunities, simultaneously, as you provide consistent, real-time support to the deal at hand.
- Pre-sales collaboration – The relationship between the architect and the sales professional is a complex one. Reason being, the sales person has expertise in handling, primarily, the sales processes while the architect is most proficient at designing, more on the technology side of the business. However, more often than not, architects are pulled into the sales motion, of which they are not too fond, and rightfully so; architects are experts at architecture, asking them to actively participate in pricing might just not be the right thing to do. Mike suggests to deal with this pre-sales collaboration delicately, following his guidelines that he’s highlighted in this webinar.
- First impressions – Getting it right the first time is key. If your customer has a good first experience with you, surely, they will know who to turn to when they need a similar, or a series of, services again. In order to achieve this, it is vital to understand the inner workings of your business; this mainly includes rules that govern your business – hard, soft, commercial, pricing – whatever type they may be, various models and configurations. Similarly, it is important you communicate said knowledge to your customer effectively too – in a language that they understand; because in reality, the true essence of sales lies in delivering an extraordinary service to the customer, or as Ian Cross, (Co-founder, servicePath) puts it, “Sales through delivery”.
- Recommendations – Having the right responses/answers/solutions handy is imperative to your success. If you scan through any statement from your customer and come across any “trigger” word (examples include: storage, database etc.) you should naturally come forward with a list of solutions of recommendations (according to the examples mentioned, recommendations can be: backup, database management) and this swift responsiveness and expression of availability should add value to your interaction with the customer.
- Pricing/Quoting Strategy – It is important to realize that discounts are, arguably, not the only way to drive audience engagement. In fact, this widely adopted promotion technique introduces friction within the business; financial and commercial alike. Mike, speaking from years of experience, suggests to avoid discounting and recommends credible alternatives that will ensure longer term commitments, in his webinar.
- Negative Discounting – To reiterate, discounting must be avoided. Instead, a viable option is that of negative discounting. Being sure of the the fact that your customer will demand a lower price regardless of the price you put forward, being prepared beforehand to give them the opportunity to get the price that they want, all the while protecting your business from a decrease in standard price is what negative discounting is all about. It will not only protect you financially, but will also, in effect, make the customer feel valued. This method is better explained by Mike in the webinar.
- Strategic margin – To have a fair idea of the degree of discount that can be granted to the customer, without causing the business to suffer, it is important to protect your strategic margin. Mike goes on to say that hard limits, like minimum pricing, have a significant impact on the decision making process of a sales professional when it comes to discounting. In any business, there are products and services that no longer hold strategic importance, resulting in areas where there is notable price churn. This can be used as an opportunity for introducing loss leader pricing which will help expand the customer base, thanks to the resultant flexibility in products and services which the business can conveniently afford to marginalize and in turn gain benefit.
- Approvals – After fully understanding the customer’s requirements and architecting a solution accordingly, approvals follow. These may be financial or technical. One thing Mike suggests you focus on is building standard configurations as much you can, since end customers can reap great benefits from these with reduced unit costs. However, one thing to remember is that it is essential for the sales person to comprehensibly explain to the customer how much time the process will take based on the standardization. Tools like lower unit price, lesser time to implement, better levels of support and manageability can be used to drive preapproved and preconfig solutions. Additionally, it is crucial that the salesperson is concious of the governance models for the financial models, essentially how the deal is measured financially, the thresholds and the variety of approval gates; this knowledge enables the salesperson to determine how the thresholds can be managed to best suit the customer’s needs. Not to mention, the salesperson should professionally follow the progress and keep a track of each step of the way intently.
- Rule of Three – Lastly, why limit your customers to just one option? Your customers will be delighted to be presented with a variety of options to pick from. Leaving them in charge of evaluating and using their own judgement to choose from variable terms, time to implement, prices, risks, availability etc. allows them to have the freedom to choose from your lineup of good, better and best. While you can, and should, put forward multiple options, choosing the one you lead with can be tricky. Mike suggests to open with the one that falls somewhere close to the top of the spectrum because, in terms of the dimensions mentioned earlier, it should be easier and more feasible to move down than up, if need be. This practice not only opens avenues for customers, but also acts as a catalyst in the price/budget discovery thus helping you serve better.
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