Power Prospecting
Page 3
Specific marketing activities include:
• Internet marketing
• Website advertisements
• Magazine, print, and publication advertisements
• Radio and television advertisements
• Yellow Page advertisements
• Billboard advertisements
• Competitor analysis and customer research
• Brochure creation and distribution
• Newsletter circulation
• Direct mail campaigns
Some endeavors that appear to be prospecting activities are actually marketing functions. For example, using pay-per-click search engine submissions to drive qualified traffic to your website is a fantastic way to generate new leads; however, it is not a prospecting activity. It is a marketing activity, a method that attempts to get buyers to contact you via the Internet, not the other way around.
The Top Three Methods for Prospecting
In the 1960s, Pentagon experts concluded that aerial combat in the future would only be fought from a great distance. Airplanes would fly at supersonic speeds, radar would see the enemy, missiles would be launched from great distances, and battles would be won and lost by pilots who never saw the enemy planes. The Air Force engineers and military experts were so certain that close range dogfighting was antiquated that they built the first fighter aircraft in the history of aerial combat that was not equipped with a machine gun or rapid firing cannon—the F-4 Phantom.
Over North Vietnam, their decision proved disastrous. The F-4 Phantom was defenseless against the lighter, more versatile Soviet MiGs. The MiGs would maneuver at close range where the American missiles weren’t effective and shoot down the bigger, less maneuverable and gunless F-4. The decision to build combat airplanes without machine guns was a tragic mistake for many of America’s finest young men.
Like the Pentagon experts who considered aerial dogfighting to be a thing of the past, many sales “experts” casually dismiss cold calling as an archaic means of generating qualified accounts. They claim that cold calling represents a primitive approach to selling practiced by old school salespeople. Unfortunately, like the F-4 Phantom debacle, salespeople who neglect to utilize validated prospecting strategies, including cold calling, will be outmaneuvered and shot down by less naïve and more savvy competitors.
Highly successful salespeople and sales organizations employ numerous prospecting methods to find new customers. These methods include:
• Networking at social functions
• Interacting at chamber of commerce meetings
• Attending trade shows
• Getting involved in community organizations
• Conducting seminars
Obviously, not all prospecting activities are equal. When I first started my sales consultation business, I joined the local chamber of commerce and attended one of their networking functions where I exchanged business cards and brochures with dozens of attendees. Seasoned chamber of commerce members swarmed to get my business. I had insurance agents, financial advisers, printing representatives, and other salespeople calling my cell phone, office phone and even my home phone. I spent the next month dodging salespeople attempting to sell goods and services to me! The experience proved to be so time consuming and useless that I was embarrassed to have attended the event.
While the aforementioned prospecting activities can be worthwhile for particular sellers in specific industries, the three most consistent and effective prospecting methods remain:
1. Asking For Referrals
2. Reference Selling
3. Cold Calling
Asking For Referrals
There is nothing unconventional about asking for referrals, except that no one does it. When was the last time a salesperson asked you for a referral?
Asking for referrals is one of the most powerful ways to generate qualified leads; in fact, leads obtained from satisfied customers are almost always more qualified than leads generated from other prospecting sources. The close ratio on a referred lead is invariably higher than a lead from any other source.
Research shows that referrals strengthen direct communication with prospects more than any other method. Beginning a sales conversation with, “Hi Ms. Thompson. Jerry Peterson suggested that I call you” is the best way to begin a buyer-seller relationship.
Referrals also differentiate you from competitors and give you an edge. If out of six cold calls to your potential buyer, you are the only one who can say, “Your colleague, Susan, informs me that you’ve been investigating new CRM software and that I may be of service,” you have an advantage. You are offering your help at the suggestion of the buyer’s friend. Referencing a buyer’s colleague makes it much harder for him or her to toss you aside into the “send me a brochure” pile.
Sellers have nothing to lose and everything to gain by asking for referrals. With that said, why do many sales professionals overlook this opportunity? There are many reasons, but the most common reason is forgetfulness. Many salespeople simply forget to ask buyers for referrals.
Sellers need to make asking for referrals a part of their selling modus operandi by keeping in mind that:
1. Referred prospects represent a higher-quality lead than non-referred prospects.
2. Referred prospects are more likely to meet with sellers than non-referred prospects.
3. Referred prospects are statistically more inclined to purchase proposed products and services.
Referrals are the most potent form of new sales leads, but they seldom happen without effort. After a sale is made, sellers should make polite, professional requests for leads and referrals. For example, a seller might ask a new customer, “Ms. Taylor, do you know of anyone else in your company or industry who might benefit from our product?” Or, “Jim, is there anyone else who might be interested in using our service?” The key is to solicit the assistance of satisfied clients who are excited about your product or service.
Once a referral has been provided, be sure to send thank-you notes, emails, and/or letters to the person who provided the referral. You might reward customers who provide referrals with gift certificates, credits, extensions, or other incentives. The well-rewarded customer will look forward to your calls and visits. I’ve had customers actually call me to ask how they may be of help. Wow! Think of the folly of not tapping into this resource of satisfied, happy customers.
The Point? Don’t underestimate the power of a referral from a satisfied customer. Make asking for referrals a standard part of your prospecting activities.
Reference Selling
There are two challenges all sales professionals face when prospecting:
1. Getting through to ultimate decision-makers
2. Establishing trust and credibility with buyers
Reference selling overcomes both challenges. By having a satisfied customer call a prospect as an “account sponsor,” sellers increase the likelihood of getting through to ultimate decision-makers on the first call because it’s not a solicitation call; it’s a testimonial call. Because the sponsor is a third party there is an immediate bond of credibility and trust.
Reference selling is one of the most available yet under-utilized prospecting methods that exists. I often ask training participants to raise their hands if they have satisfied customers in their territory. Next, I ask them how many satisfied customers they have. Participants usually answer, “I’d say at least ten, maybe more.” “Forty-five.” “Twenty-six.” “Hundreds.” O.K.—so far, so good. We then ask them to keep their hands in the air if they have ever used even one of their satisfied customers to make a call on their behalf. The fact that ninety percent of the hands go down, never surprises me, but always amazes me.
Because most executives refuse to take solicitation calls, sellers find it difficult to
start at the top of the business chain without employing nontraditional selling strategies. Existing client executives or satisfied customers calling on your behalf is both an effective and unconventional way to access top executives and decision-makers.
One of the reasons executive networking is so effective is that it has the dual effect of being both a sales call and a testimonial call. This provides an opportunity for sellers to open the call at the highest echelons of an organization with power and credibility.
If some clients are more inclined to send an email than to make a telephone call, that’s fine. Use the reference email as a springboard to contact the buyer and set up an appointment.
Sellers need to provide incentives for the customer who is making the prospecting call. For instance, a seller might send the person making the call a gift certificate or a discount on a future purchase—some type of reward for making the call.
The Point? Reference calls are typically (in fact, almost always) more effective than cold calls. Utilize satisfied customers to contact potential clients as account sponsors to open the sales relationship.
Cold Calling
Asking for referrals and using reference selling principles are effective prospecting activities, but no prospecting game plan is complete without cold calling. Like the F-4 fighters being equipped with only bombs and missiles, they lacked a complete aerial arsenal without machine guns for close range fighting.
Although most salespeople recognize the need for cold calling, they don’t like to make cold calls. In fact, only people who have it “floored in neutral” enjoy large doses of cold calling (They do exist; I’ve met them). Salespeople don’t like making cold calls, and businesses don’t like receiving cold calls, so why are people still cold calling? It’s simple: it works. Cold Calling is one of the most consistent lead generation methods in sales. Regardless of who prospects (sales representatives, sales assistants, call centers, outsourcing centers, etc.), cold calling consistently generates qualified leads and sets appointments.
Cold calling is like the grit in the oyster that produces the pearl . It’s estimated that every week close to one hundred million sales calls are made by telephone. Yearly these calls generate close to $380 billion dollars in sales revenue.
Note: Because cold calling is a primary method for generating new opportunities, it is the principal focus of the remainder of this book.
Isaac Newton created a mathematically quantified account of gravitation that embraced terrestrial and celestial phenomena alike. In the process, he demolished the Aristotelian interpretation of the universe and established a physical basis for the Copernican universe. His laws, theories, and observations are regarded as scripture in the scientific community which still uses them today to guide spacecraft. When astronaut Bill Anders’ son asked his father who was driving the Apollo 8 spacecraft, Anders replied, “I think Isaac Newton is doing most of the driving now.”
By nature, Isaac Newton was a loner who did not revel in social settings. Filling his lonely days with books and research, Newton died a virgin. While a college student at Cambridge, he commented, “Plato is my friend, Aristotle is my friend, but my greatest friend is truth.” Newton’s constant quest for knowledge necessitated his inventing a new branch of mathematics titled calculus (an invention most college graduates wish he had not invented!). His search for knowledge was so extensive that he actually surpassed the existing theories and thoughts of his day.
Although it would be difficult to exaggerate Newton’s contributions to science, he is most often remembered for his three laws of physics known as Newton’s Laws.
Scholars and scientists who marvel at the inventions, discoveries, and creativity of Isaac Newton repeatedly ask, “What was his secret?” “How was he able to discover and accomplish so much?” “Was it really just pure intellectual genius?”
Newton’s success was, of course, influenced by his rare intellectual genius. But his natural brilliance was not enough. Surviving drafts of Newton’s primary work, Principia, support Thomas Edison’s dictum that “Genius is 1 percent inspiration and 99 percent perspiration.” Newton’s work ethic and willingness to abandon previously held notions led to his unrivaled scientific discoveries. Newton was, in effect, “teachable” and ever ready to yield to new truths. This was particularly the case when the newly discovered truths flew in the face of assumed authority that was based on false conclusions. Newton tested everything. He did not merely rely on theory or assumptions.
In like manner, successful prospecting is the result of hard work, persistence, and a willingness to test and implement intelligent prospecting strategies.
Total Market Opportunity
Isaac Newton’s first law of motion states that mass persists in a state of rest unless acted upon by external forces. This scientific law is referred to as the principle of inertia. In sales, potential clients often remain in a state of inertia until acted upon by external forces that embrace effective prospecting skills and activities. In other words, most prospective clients remain in a state of complacency until nudged into action by sellers with the skills and strategies to generate interest.
In any given market, the majority of potential buyers are not actively looking for goods or services to purchase. Most markets reflect the 95 > 5 rule, which states that less than 5 percent of a total market opportunity is actively engaged in evaluating products or services. The remaining 95 percent is still a market opportunity but remains in a state of inertia unless advanced into a state of interest through effective prospecting.
Figure 1.2
The purpose of prospecting is turning inactive opportunities into active opportunities. To achieve this objective, sellers need to implement prospecting skills that propel potential clients out of a state of inertia and into a state of interest.
1. See Chapter 3 for more information regarding pipeline management, terminology, and reporting.
Chapter 2
Overcoming Prospecting Fears
Our doubts are traitors
And make us lose the good we oft might win
By fearing to attempt.
—William Shakespeare
In the winter of 1925, a deadly diphtheria epidemic broke out among the children of Nome, Alaska. Nome had no serum to combat the disease, and the nearest supply was 700 miles away in Anchorage. Given that the snow-covered landscape was virtually impassable, and the two state airplanes were in storage for the winter, the governor decided the serum would have to be “mushed” to Nome by a series of dogsled teams. After transporting the lifesaving serum to the town of Nenana by rail, officials delivered it to Wild Bill Shannon, whose dogsled team was the first of 18 teams to carry the serum 674 miles across the frozen tundra.
While the drivers raced against time, weather conditions could not have been worse as temperatures dipped to 40 degrees below zero, and gale-force winds created walls of blinding snow. On the fifth day, the sled carrying the serum lost all contact with the outside world, and Alaskans feared the worst. Suddenly, on the morning of February first—127 hours after the first dogsled team left Nenana—Gunnar Kaassen and his team of dogs emerged from the darkness, successfully delivering the serum to the children of Nome.
At times, conditions were so bad that Gunnar had to rely solely on his lead dog, Balto, for direction. Balto quickly became a celebrity throughout America when his picture was circulated by the press. He toured the country and even had a statue erected in his honor in New York’s Central Park.
This epic journey of strength and endurance is commemorated annually in the great Anchorage-to-Nome dogsled race named after the trail on which it is run: the Iditarod. Today, the Iditarod celebrates the men and dogs that conquered their fear of the brutal Alaskan winter and achieved one of the most heroic feats in U.S. history.
Conquering Our Fears
Like the dogsled te
ams in the race to Nome, salespeople who conquer their fears achieve seemingly impossible tasks, reach their goals, and accomplish their professional and financial objectives.
As sales managers, directors, and executives know, getting a team of sales professionals to spend 20 percent of its time prospecting can be incredibly challenging. As a former sales manager, I met regularly with our salespeople to discuss pipeline issues because many of them did not have a sufficient supply of qualified accounts. As we would discuss the need for cold calling, I noticed a clear and consistent pattern of explanations for avoiding cold calling: explanations were always emotional and never rational. I never had a salesperson say to me, “Patrick, cold calling is an absolute joke; only idiots cold call. No one here has ever closed a sale generated by a cold call!” It was impossible for them to make such a statement because a significant amount of our pipelines were built with cold calls, resulting in major sales.
I regularly train salespeople who tell me with great fervor that cold calling is a waste of time and that they have much more productive ways to generate leads. My standard response is, “Like what?” Typically, they respond with, “Well, for instance, contacting existing customers,” ”following up on current leads,” or my personal favorite, “sending emails.” I usually reply, “And how many qualified leads did you obtain last week from doing that?” The response is usually something like, “Well, I, uh,… ya,… uh… usually… let’s see… uh, I think I got a couple of follow up emails.” Right.
Explanations for not cold calling almost always migrate away from prospecting activities into other selling or marketing activities. One of these activities, for example, is following up on current leads, which is not a consistent method for generating new leads. Of course, if you call all of your existing leads and ask them for referrals that will be terrific. You will probably generate some excellent leads. It will also take you about an hour.