The introduction of the Arabic system was not without controversy. Universities, government, and religious authorities expressed suspicion of the new numbers because they originated from “infidels.” In stubborn defiance, many European universities continued using the abacus and Roman numerals. The merchants, however, could not afford to wait for the approval of professors and priests. They needed a practical means of calculation and immediately began using the Arabic system.
The new numbers proved to be practical and spread quickly throughout the commercial centers of Europe, producing a mathematics revival, which helped clerks, bankers, and merchants perform the tasks of converting money, calculating interest, and determining profits and losses.
Selling: a Numbers Game
To maximize selling success, it’s important to grasp the relationship between numbers and results. Like the ancient merchants of Europe using Arabic instead of Roman numerals, sellers who grasp the relationship between measurement and performance have a distinct edge over competitors who don’t.
We have all heard the saying, “Selling is a numbers game.” Despite this clichés overuse, it is true. Measuring activity, success, and rejection rates gives sellers the statistical averages to determine the number of sales calls they need to make to achieve financial objectives.
It is no secret that most salespeople don’t like maintaining numerical data or creating reports. However, the pros of reporting far outweigh the cons of not keeping score. In fact, without reporting, it’s impossible to consistently achieve peak performance standards.
By closely monitoring prospecting activity results, sellers establish prospecting schedules based on factual data. By determining the number of calls it takes to eventually close a sale (call to close ratio), sellers can evaluate how much time they need to cold call each day to meet personal goals, sales quotas, and financial expectations.
Know Your Numbers
Cold calling is a ratios game. If you know your ratios, you can adjust selling focus and efforts accordingly. If you don’t know your numbers, how will you know whether or not your sales approach is working?
Note: Tasks that are measured are accomplished. Tasks that are not measured are forgotten. You can only expect what you inspect. Keep score.
In order to know your numbers, answer the following questions:
• How many cold calls do you need to make each day to reach your sales goals?
• How many dials does it take to talk to a decision-maker?
• How many calls does it take to set an appointment or qualify a lead?
• How many appointments or qualified leads do you need to close a sale?
• What is the average dollar amount of each sale?
By maintaining accurate prospecting statistics, you can adjust sales strategies, fine tune sales plans, and make needed changes to cold call approaches. Knowing your numbers allows you to understand your prospecting strengths and weaknesses. Armed with this data, you can make intelligent modifications to your selling behaviors.
To measure the success of your prospecting efforts, get in the habit of tracking five vital statistics:
1. The number of dials: How many times you dialed phone numbers over a specified period of time (day, week, month).
2. The number of completed calls: Actual discussions with prospects.
3. The number of objective successes: The number of set appointments or qualified leads.
4. The number of sales: Actual purchases that resulted from cold calls.
5. The average amount of each sale: The combined average of total sales.
Note: Use The Weekly Prospecting Report (Figure 21.1) to quantify the relationship between dials, completed calls, successes, number of sales, and sales amounts.
Calculate Your Daily Cold Call Quota
I was once given a territory with an expected quota of $500,000 in gross sales over a 12-month period. The average sale was about $20,000, so based on the average sale amount, I knew I needed to make 25 sales to reach my quota. At the time, this particular sales organization was closing about 20 percent of their appointments—in other words, about one in five. I knew that I needed to set at least 125 appointments to close enough sales to hit my quota of $500,000. Cold calling was the primary method for setting appointments, and they typically set one appointment for every 20 calls made.
• Quota: $500,000
• Average sale amount: $20,000
• Required sales to reach quota: 25
• Average appointment close percentage: 20% (1 in 5)
• Needed number of appointments: 125
• Number of appointments set per cold call: 5% (1 in 20)
• Needed number of calls over a 12-month period: 2,500
• Needed number of cold calls a day to hit quota: 10
Based on these numbers, I calculated that I needed to make 2,500 hundred calls a year to meet my quota of $500,000. That averaged 10 cold calls a day if I worked 250 days a year (not a mammoth task by any means). Of course, meeting my quota was not my goal. I wanted to surpass my quota, so I set aside one hour a day for cold calling in order to make at least 20 calls a day to exceed my quota—which I did.
Why Keep Score?
By utilizing a consistent tracking system, sellers can identify exact numbers to measure return on investment ratios. Armed with performance data, they can determine areas that need improvement, establish appropriate prospecting schedules, and make accurate revenue projections.
An added benefit of reporting is building confidence. When sellers can review a sales report that reflects productive selling statistics, it builds certainty and eliminates doubt.
Power Prospecting Weekly Report
Figure 20.1
Chapter 21
The Ten Commandments of Cold Calling
As a child in Egypt, Moses was saved from the slaughter of all male Israelite children by being hidden in the bulrushes in the Nile where he was found by one of Pharaoh’s daughters and raised in the Egyptian court. He later became the prophet and lawgiver of the Israelites and led them out of Egypt. After wandering in the wilderness for forty years, the Israelites approached the promised land of Canaan.
In an attempt to communicate with God, Moses climbed Mount Sinai. There, Jehovah gave him the Ten Commandments for the Israelites to keep in order to maintain their favorability with God. Throughout their history, when the Israelites obeyed the Ten Commandments, they flourished, but when they disobeyed the Ten Commandments, they floundered.
Similar in principle to the original Ten Commandments (in a purely contextual sense), The Ten Commandments of Cold Calling are rules of engagement. They are proven success formulas and tested prospecting principles that lead to success. By following The Ten Commandments of Cold Calling, sellers achieve predictable sales results. By violating The Ten Commandments of Cold Calling, sellers proceed at their own risk.
Commandment 1: Develop a Spontaneous Tone
People do not react well to calls that sound dull, boring, or as if they are coming from a machine, so develop a positive, spontaneous tone that establishes believability and genuine rapport between the buyer and seller. Monotone calls drain the life out of cold calls and encourage prospects to terminate the conversation. Calls that sound artificial project shallowness and scream, “Inexperienced, gum smacking, minimum wage telemarketer!”
Be upbeat, positive, and enthusiastic. Sound human and natural to establish cold call chemistry. Even when reading from a script or using an outline, use an upbeat, conversational approach. Practice good telephone skills, and you will maximize your selling efforts. If necessary, use a recorder or telephone message machine to record cold calls to review and improve delivery skills. Do whatever it takes to develop a spontaneous tone.
Commandment 2: Get Down to Business Ea
rly in the Sales Call
Far too often salespeople try to initially engage buyers with small talk about sports, weather, golf, or other non-sales related items. While momentary small talk is perfectly acceptable (and in some cases even preferable), don’t over do it. Sellers who chit chat about non-business related issues too long run the risk of sounding phony and insincere.
Note: Small talk is good—in small doses. Big talk is better. Get down to business early in the sales call.
While engaged in small talk, avoid controversial topics such as religion, politics, and sex. People have an amazing amount of stored up energy (and sometimes frustration) with regard to social and political topics, so even casual remarks by a seller can set off a powder keg response from a buyer. Sellers are better off avoiding controversial topics completely.
Commandment 3: Avoid “Show Up, Throw Up” Presentations
Remember not only to say the right thing in the right place, but far more difficult still, to leave unsaid the wrong thing at the tempting moment.
—Benjamin Franklin
During World War II, the British Intelligence agency assembled Britain’s finest mathematicians and chess players to crack the German communication code. These mathematical and mechanical geniuses deciphered a predecessor to the modern computer, a machine called Enigma. The first intelligence Enigma deciphered was information concerning a massive bombing of Coventry, England. British Intelligence was suddenly placed in a precarious dilemma. If they scrambled extra forces to meet the attack, the Germans would be alerted that their code had been broken. On the other hand, if they did not muster a defense, thousands of people in Coventry would be killed. Winston Churchill and other British leaders decided that to achieve long term military objectives, it was necessary to allow the attack to proceed unimpeded. British leadership was forced to exercise almost unbearable patience as they watched the town of Coventry bombarded into rubble.
Like British military leaders during World War II, cerebral sellers do not sacrifice long term objectives for short term advantages. They avoid the temptation to rush in and share all the information they possess about the benefits and capabilities of their product or service.
One of the most common mistakes sellers make on initial sales calls is jumping into premature solution presentations. Solution presentations should be reserved for face-to-face meetings or later in the sales cycle, not in the initial cold call because premature presentations can potentially bore a buyer, create unnecessary objections, or kill the sale early in the prospecting stage. Premature presentations bring up features and capabilities without first identifying correlating needs, pains, and problems. As a result, questions, obstacles, and objections are sometimes introduced that have to be overcome later in the sale. In addition, too much information can confuse or overwhelm a prospect.
Of course, product and service capabilities need to be introduced to prospects, but in the initial sales call, delivering an introductory presentation and asking questions should be the focus of the call.
Commandment 4: Concentrate on Discovery-Qualification and Need-Problem Questions
Good sellers focus on fact-finding and qualification questions early in the sales relationship. The DNA Selling Method’s first step is asking discovery-qualification questions (see Chapter 11). These questions are critical to the success of the qualification-based cold call.
Discovery questions help identify information that can be used to make informed proposals and accurate recommendations. Once a salesperson has obtained discovery information, prospects should be qualified. Qualifying questions determine if prospects are worth pursuing. The remaining steps of The DNA Selling Method are based on information gained from discovery-qualification and need-problem questions.
Note: Remember, no problem = no sale. Focusing on need-problem questions in the initial stages of the sales call will ensure you address the needs, issues, and interests of the prospect.
Commandment 5: Avoid Exaggerated Statements and Rhetorical Questions
In most cases, sellers set the tone of a sales conversation. If the seller sounds cordial, professional, and positive, normally buyers will respond “in kind.” If you want a quality response, have a quality opening statement and avoid exaggerated statements and bizarre questions such as, “If I could save you millions of dollars, would you be interested?” Most people feel insulted and manipulated when they are asked questions like that.
Opening statements that use wild exaggerations to gain attention come across as eccentric. Avoid opening cold calls with over used hyperboles that begin with “ultra,” “mega,” “awesome,” “incredible,” “amazing,” “remarkable,” and other superlatives prospects have heard a thousand times before.
Like exaggerated statements, prospects do not respond well to rhetorical questions, so avoid using questions such as, “Is productivity important to you, Mr. Nugent?” “Is quality important to your business, Mrs. Liddy?” Or, “Would you like to increase your sales?” Of course productivity, quality, and increased sales are important to buyers, and it’s insulting to have to state the obvious. Prospects immediately recognize rhetorical questions as manipulative and self-serving.
Eccentric openings don’t work because they produce eccentric responses. From the beginning of the sales process, be professional. Avoid exaggerated statements and rhetorical questions.
Commandment 6: Be Organized
I managed a salesperson who had a wonderful personality, excellent sales and presentation skills, and a great sense of humor, but he lost winnable sales because of his lack of organization. He lost leads and phone numbers. He miscalculated travel times between appointments and was often late for presentations.
I worked with him on a major account that involved hundreds of thousands of dollars. We ran into a small emergency and needed to contact the primary decision maker instead of the project coordinator. It was a Saturday morning and we had a problem that needed to be addressed immediately, but even though personal and business contact information for this decision maker had been provided, our salesperson had lost the information. He was so unorganized and had so much paper and so many piles of folders and trash on his desk that the phone number had been lost in the clutter. We failed to contact the decision maker, and, as a result, missed a fantastic sales opportunity.
It would be difficult to exaggerate the importance of being organized. Unorganized sellers are less successful than organized sellers. Without an organized means of tracking sales leads, sellers duplicate calls, misplace names, lose phone numbers, and lose sales.
Use a contact management system to keep track of calls (see Chapter 3). Record detailed notes for follow-up calls, emails, and letters. A computerized system allows sellers to easily access contact records and facilitates the sales and prospecting process.
Regardless of whether you use an electronic or paper system, you should implement a lead tracking system to be organized.
Commandment 7: Make an Appointment with Yourself to Cold Call for One Hour Each Day
The 80/20 rule is a fundamental business principle, equally applicable in sales. Top sales performers spend 80 percent of their time selling and servicing their customers and set aside 20 percent of their time for prospecting. Scheduling time for cold calling decreases the peaks and valleys of selling. Elite sellers make appointments with themselves each day to make uninterrupted cold calls. Making an appointment with yourself to cold call for one hour a day (without interruption) allows you to constantly generate qualified opportunities without getting burned out.
Note: Prospect between the hours of 9:00 A.M. and 10:00 A.M. (buyer time).
I recommend prospecting between the hours of 9:00 A.M. and 10:00 A.M. (buyer time) five days a week. This hour is sometimes referred to as “The Golden Hour of Selling.” According to The American Telemarketing Association, a person is five times as likely to reach a pr
ospect during these hours than at any other time of day.
Commandment 8: Use a Telephone Headset
When I cold call, I prefer to use a telephone headset because I like to stand up when I make my calls. Not only do headsets free my hands up for taking notes or typing, they also allow me to walk or move while cold calling. Additionally, because I am standing up, my voice resonates, my energy is higher, and my mind is more alert. Headsets help me multi-task with focus. By freeing up one of my hands, I am more capable of utilizing cold call resources such as notepads, automation programs, and script sheets.
Headsets also make cold calling more comfortable by reducing stress in shoulder and neck areas. Headsets are readily available and make sense for sellers serious about cold calling. It sounds like a trivial issue, but use a telephone headset.
Commandment 9: Have Achievable Expectations
The power prospecting model is not designed to work 100 percent of the time. The goal is to improve call-to-close ratios (sometimes referred to as a “hit” ratio) and increase call-to-sale percentages.
Far too often sellers are pumped up about cold calling only to become discouraged due to unrealistic expectations. Even Babe Ruth, the greatest big league hitter in the history of baseball, was not successful a majority of the time. The greatest salesman on Earth is not going to hit sales homeruns the majority of the time, so don’t set yourself up for failure. Have realistic, achievable expectations when cold calling.
To keep things in perspective, and to maintain a positive attitude, I recommend that every now and then you just blow one for fun. “Hello, does someone in your organization speak Swahili? We’re doing a survey but only to people who speak Swahili.” Or, “We’re selling security certificates that are specifically designed for three-year olds. Do you have a three-year old I can speak with?” Have fun. Lighten up. Understand that losing a few battles is a part of winning the war. Have realistic expectations.
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