Subscribe to BirdsEye View, my newsletter (View newsletter archive)
|The Genesis of Our Forums|
Chief Investment Officer
Commercial Loan Automation
A Simple Sales Model (Third and Last in a Series)
Mike Weinberg’s book – NEW SALES SIMPLIFIED – speaks to me. His experiences and sagacious advice resonated with my years of experience as a salesperson and sales manager. Perhaps most of all, his sales model made eminent sense to me (possibly because I come from Israel?):
1. Select targets
2. Create and deploy weapons
3. Plan and execute the attack
You might recoil at this aggressive way of outlining an effective sales model. It makes sense to me. Sales entail a certain level of assertiveness, and this model speaks to that.
This article highlights the first set of elements of this simple model for new sales success – target selection. For the rest of it, please buy the book.
1. Essential requirements for a successful new sales performance:
• Incentives do not work against the desired sales effort
• Sales talent is at least average
These are necessary but not sufficient conditions for effective new sales performance. Some banks have all three in place, and yet sales performance falls short.
2. Why aren’t you closing new deals?
There are three root causes to the problem:
• Poor target selection
• Ineffective sales weapons or ineffective weapon deployment
• Inadequate planning or ineffective plan execution
3. Improving target selection
The proactive business hunter develops a strategically selected list of appropriate targets to maximize personal effectiveness. The very list selection process can focus any salesperson on true strategy. Understanding our best customers and their characteristics is the first step to identifying similar targets to prospect. Further, it critical to align the entire team’s expectations in terms on how much time should be spent on the sales effort and the business.
4. Targets must be FINITE, FOCUSED, WRITTEN AND WORKABLE
• Finite: Develop a manageable list of targets/prospects, and work those for a long time. Do not switch names or change the focus upon early failures. Keep at it. Persistence is an excellent sales tool.
• Focused: Focusing on a vertical market or a certain type of prospect yields many benefits. Repeated calling on the same type of company, small business of wealth prospect allows the sales person to become expert as they learn the culture, jargon and business issues facing similar prospects. We become more comfortable and confident, and find ourselves bringing value-added to the conversations we have as we learn more from each meeting.
• Written: This requirement helps focus the salesperson on the one list of targets they have without distractions. There is some perceived level of commitment to writing down these names vs. scrolling your Salesforce prospect list.
• Workable: What is the right number of prospects on a list? It depends… Hence the word “workable”. Too few prospects will doom you to failure; too many will not allow you to give them the attention they need. The key is to create a target list that can be worked effectively and thoroughly over the defined period of prospecting.
Customers must also be segmented to facilitate you putting your best work toward your best targets. One effective segmentation technique is offered below:
• Size – largest dollars spent (which often isn’t the largest target company)
• Most growable – best opportunity for incremental revenue
• Most at-risk – Highest probability of losing their business
• Most likely to switch – Any Greenwich report will tell you which prospects are disenchanted with their current bank and why
This process compels the salesperson to make intentional decisions about the prospect and the opportunities they present.
5. Preparing for target selection: The WHO and WHY questions
In most banks target lists are provided by the marketing department. They are long and undifferentiated, and some have a rapid decay factor (i.e. if you don’t call the prospect within a couple of days the likelihood of the target conversion declines rapidly). In many of the businesses we call on, the targeting process is quite different. The sales staff develops their own process, utilizing questions such as:
• Who are our best customers (segmented as finely and innovatively as possible)
• Why did they select us initial? Why have they stayed with us?
• Who is the competition?
• Why have we lost business? What are the characteristics of the businesses and individuals who left us?
• What are the root causes for recent losses of loan proposals or investment management proposals?
6. Making the most of referrals and indirect selling
Banks rely heavily on Centers Of Influence (COIs). It’s a fraternity/sorority of professionals who refer each other business from their customer stable. A referral from a trusted advisor is priceless; as a result, most commercial bankers and wealth advisors work their COIs heavily.
Successful proactive Mortgage lenders continually work real estate agents to be the first to get the mortgage referral from them. Private banking RMs target personal bankers and tellers at the branches, trolling for affluent prospects. The COIs are, essentially, our customers, and the ultimate customer is a step removed from the initial sales effort. In reality this is an indirect selling model, which means that we should treat our COIs, both internal and external, as if they are the ultimate customer. One should segment and prioritize them just as we do other leads.
7. Resources to identify targets
There are numerous high-value resources to identify target COIs and actual prospects. The local business journal, for example, could become invaluable for B-to-B salespeople (commercial bankers, institutional wealth, Treasury Management). The association of these papers, American Cities Business journal (Charlotte, NC), publishes weekly business journal in 40+ cities around the country. Each year, each paper compiles a book of lists for its market area, which can be sorted in many attractive ways. There are always resources such as D&B, Hoover, First Research, LinkedIn and Greenwich research, which I mentioned before.
8. Pursuing your dream targets
We all have prospects we WISH we converted into clients. They are our Moby Dicks. The celebration of closing a career-defining deal with one of those defies description. Obviously, those are extremely attractive to your best sales people – as well as to everyone else’s.
When hunting elephants, Weinberg provides two key pieces of advice:
• Limit the list size to 4-5 targets.
• Pursuing dream clients is a high-risk, low probability of success effort. Do not neglect your normal targets as you fall in love with the dream.
AB: I’ve found that there is a special thrill as you pursue the white whale, the one that will change everything for you. The sales cycle here is extremely long (my longest was 7 years), and most do not yield a good return on our time investment. Nevertheless, the satisfaction of bringing in the best “name” in town is too sweet. Everyone should try for one!
9. Targeting contacts higher in the customer organization
It is as important to target individual decisions makers within an organization or a wealth candidate family as it is to select the targets themselves. There is typical anxiety associated with going up the food chain and targeting higher-level prospects, but it is important to establish that connection to win more, if not all, of their business.
“The fear of moving up the ladder is artificially self-induced because of incorrect assumptions”, says Weinberg. Salespeople scare themselves into fearing the executive suite. However, people who made it all the way to the top are often very nice people who are genuinely concerned with resolving business issues and achieving better results. They are eager to learn from folks who can show them ways to improve the bottom line, employee morale, investor relations etc.
AB: there are several points this series aimed at highlighting:
• All of us need to be competent sales people
• We should “own” our sales process
• Waiting for someone else to help, teach, cajole, inspire etc. separates successful sales people from the mediocre ones
• You can’t control what any individual prospect will do, but you can absolutely ensure you will make your numbers if you call on enough people. The law of large numbers is on your side.
• Being PROACTIVE in all that you do, especially prospecting, will reduce or possibly eliminate dry spells, sleepless nights and lots of stomach acid.
• Sales is about organization and discipline:
o Organize your prospects
o Prepare your pitch
o Learn how to handle objections
o Do not get distracted by anything when selling or prospecting
o Be intentional about how you spend your time and resources
• Be professional. A good salesperson embraces the profession and handles themselves, their time allocation and mind-share accordingly.
There are many books about sales. Few are as simple, blunt and honestly true as Mike Weinberg’s “New Sales Simplified” book. It focuses on the hardest sale of all – converting a prospect into a life-long client. It also contains much wisdom for your daily lives.
New in the Nest:
This column will offer fool proof recipes, restaurant suggestions and other foodie tidbits for your consideration and consumption.
You can find more tasty recipes in the Recipe Archive