Sales Blog with Professional Sales Tips

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Customer Referrals. For some reason this resource for prospecting is often overlooked. It’s as if we are walking on gold nuggets and don’t take the time to stoop down and pick them up. This is a very quick way to find prospects that are already warmed up to some degree. Here are some things to keep in mind when getting and using referrals:

1. You can get great referrals from both your small customers and from your large customers. The most important thing is your relationship with them; it doesn’t matter how big or small they are. Just because your contact works in a small company doesn’t mean that they don’t know a lot of people, some of which might be great prospects.
2. Be sure to help your customers qualify what a good referral would be. Instead of saying, “Do you have someone you might refer to me?” say, “I’m looking to build my customer base with $100M+ companies that need 24 hour service on their printing equipment.”
3. Ideally you’d like the referring customer to introduce you to the referral on the phone or in person. If that’s not possible, then an email or phone call from the referring customer to the referral letting them know you are going to contact them is the next best thing. If none of the above is possible then at a minimum ask your customer if you can use their name when contacting the referral.
4. Always follow-up on customer referrals and make sure you let the referring customer know what happened, and thank them too. If you routinely take this step you’ll find that customers will provide you with referrals without your even asking; this is your ultimate goal in the referral business.
5. When asking for referrals specify the number of referrals that you want. If you just ask for a referral you might get one, and only one. If you ask for three you’ll get three. “Debbie, as you know I’m always trying to build my business. I’m looking for companies that would use our chemical products, are located in the Denver area and have 100+ employees. I would be greatly in your debt if you could give me three names to work on.” Guess what happens next? Debbie gets busy coming up with three names for you.
6. Getting referrals is not only for established salespeople with long term customer relationships. I’ve frequently seen new salespersons get referrals from their new customer base. “Mark, I’m new and need to find some more good customers like you to build my account base. When I feel that you are completely confident in me I’m going to ask you for three referrals that I could contact.”
7. I’m not a big fan of monetary, or other, compensation when customers provide referrals. When the motivation becomes money the quantity of referrals picks up but the quality nosedives. Besides, would your best friend charge you money to set you up on a great blind date?

Customer referrals are a great way to quickly build your business and are one of the most overlooked tools in the sales business. As a final note, an interesting thing about customer referrals is that they also build your relationship with the referring customer.

To receive this sales tips blog by email <click here> to receive by RSS <click here>. © 2008 Scott R. Sheaffer

People ask me how I come up with material for this blog. It’s actually quite easy; all I have to do is pay attention to the sales behaviors that I observe every day. Some of the stuff I see truly fits in the category of, “You could not make this up.” Below is a conversation that I observed between someone that was in the final stages of making a big ticket purchase and the CEO of the selling organization who was “helping” his salesperson close the deal. I am not making up the dialogue that follows.

Prospect: “I have a few more questions that need to be answered before we ink the contract. I was hoping to hear from you last week regarding those questions. Are you still interested in moving forward with this?”

CEO: “Oh yes, we are very interested in having you as a customer. I would have gotten back with you last week but I’m just a busy CEO.”

Despite the CEO’s best efforts at being the CEO of the sales prevention department, the prospect actually did sign the contract and purchase the service. The customer in this situation always referred to the CEO as Jason “I’m just a busy CEO” Short (not his real name) after that. One cautionary note, CEO’s and presidents can absolutely be the worst people to bring along on sales calls. Don’t assume they have a clue about selling just because they might be paid more than you.

Where did this CEO blow it? He blew it because he made it loud and clear that the prospect was not his number one priority. The CEO also communicated that he thought he was a higher priority than the prospect. Individual prospects and customers want to believe that we build our world around them. Even though they know that we deal with other companies, they want to at least feel like they are: number one in our minds, our only customer and have 100% of our attention. Think about your personal experience with doctors. Even though you might be visiting a doctor that has 500 patients, if he or she can make you feel like you’re their only patient it scores big points with you. The same is true for you and your customers and prospects. Make each of them feel very special; they’ll pay you for your attention.

Have you ever fired a customer? I have on several occasions. It’s the most liberating and educational thing you will ever do in sales. When I say “fire” I’m talking about this kind of conversation with the not-so-desirable customer:

You: “Mr. Customer, we want to thank you for your business (well, not really but it seems like the kind of thing you should say at a moment like this), but we feel that your needs could be better served by another company (at this point you might want to give them the name of your most hated competitor…which I have actually done).”

Ex-Customer: “What!? You can’t do that. I thought we had a good relationship. Who is going to provide us our widgets/service in the future?”

Early in my career I had a public sector customer that was a pain in the neck to deal with, paid slowly and wanted us to sell them our products and services below our costs. One day the president of the company I was working for at the time blew into my cubicle and said, “Lose this customer. Fire them. Today.” I was a little nervous when I was actually firing them, but here is what I learned:

1. There are many prospects out there; don’t waste your time on bad customers who squeeze you on margins, are high maintenance, tie up resources and don’t pay their bills in a timely manner.
2. Bad customers will frequently try to bluff you into thinking that you are easily replaceable and that you should be happy to have them as a customer. The truth is that your knowledge of how they do business is very valuable to them.
3. You are more powerful than you think when it comes to your relationship with your customers. Don’t abuse this knowledge, but know that a sales/customer relationship is a partnership. A partnership implies parity.

Am I suggesting that you go on a wild customer firing spree? Of course not. But the process of eliminating a chronically high maintenance and unprofitable customer will empower you and free your time to go after profitable and professionally rewarding customers.

The sociological definition of a dysfunctional work environment would broadly state that as a consequence of a social practice or behavior pattern the stability of the group is undermined. It’s disturbing to me that the subject of dysfunctional work environments is one of the most popular business topics today. Most workplace psychologists agree that every company has some kind of dysfunction. There is no perfect workplace. That really shouldn’t come as a surprise to us since nothing is perfect in this world. Families, churches, schools, etc., none of them are perfect. People are messy.

While virtually every workplace has some level of dysfunction, there are levels and types of dysfunction that are tolerable and those that are not. There are books written about this and I have personally worked in sales environments where there were some really nasty things going on. The dysfunctional behavior I want to touch on in this post is that of management by intimidation. This one is particularly prevalent in sales management. The sales manager thinks, “If I put pressure on those lazy stupid sales people and show them who’s boss, I’ll increase their productivity.” The worst part about this “strategy” is that it works, but only in the short term. People will in fact work harder for a boss that is screaming at them, but only long enough to pacify him or her. While the sales manager is throwing his or her daily/weekly fits at selected individuals, these same individuals are planning their exit. The ignorant sales manager is also most likely naive about the outgoing salesperson’s plans to take their customers with them. One important note here. It has been my observation that management by intimidation is not gender biased. While I have certainly observed unbalanced individuals that were men, I’ve seen women that were equally as bad.

How can you tell if you are working for a sales manager that rules by intimidation? Here’s a quick checklist with some common symptoms:

Always fault finding
Various threats, most are veiled
Reckless and irresponsible behavior
Belligerence toward customers
Substance abuse
Temper tantrums
Needs subordinates to be completely submissive
People frequently comment about his/her irrational behavior
His or her boss also rules by intimidation (or a corporate environment of intimidation)

If you find yourself in one of these environments see if you can get moved to a different boss. This is a primary strategy although I have to caution you that if a company tolerates this kind of behavior from one manager, they’ll probably tolerate it from others. Your next strategy is to find a new company to work for. Please do not wait for the individual to see the errors of his or her ways and get better. That won’t happen. While everyone can have a bad day and say something that may hurt someone else’s feelings, a sales manager that continually rules by intimidation is someone you need to get away from before you internalize their toxic message.

We’ve all heard the expression, “In golf you drive for show and putt for dough.” I love that expression because it applies to just about every area of your life, especially sales. If you love golf there is nothing more satisfying than hitting a 300+ yard drive from the Tee Box. There is most assuredly a positive correlation between the distance driven and one’s ego gratification. But here’s the killer. Each stroke counts the same whether it’s a 300+ yard drive or a two inch tap-in at the cup. Things aren’t so satisfying if a golfer gets to the green in beautiful style and then takes five putts to get in the hole. Those short missed putts add up quickly.

Sales is the same way. Everyone with even an ounce of sales ability loves to meet that important prospect for the first time and make that first sales presentation. Don’t we all love making a good first impression and knocking them dead with our presentation skills in front of a group? When we do these things well, the sales process moves ahead nicely. However, “moves” means something completely different than “closes.” The sale is not completed until the decision maker gives it the thumbs up. After the initial meetings and presentations are over there are plenty of other details that need to be handled before the sale is completed. Get out your putter.

Because most sales professionals are good at the front end of the sales cycle, our prospects tend to judge us on the small things that follow instead, i.e., our putting. Prospects also know that they are seeing us at our best and at our company’s best during the start of the sales process. They know our responsiveness and thoroughness aren’t going to improve after the sale is consummated. For these reasons they put a lot of weight on how we follow-up with them on the details of the transaction as the sales process progresses.

I’ve seen many interested prospects turn sour when they realize that the salesperson and the company are all show and no go. Potential customers know that once they purchase from you that the day-to-day maintenance of their account will be nothing but details and timely follow-up. It’s your ability to handle the details during the sales process that will gain their trust and confidence. Go ahead and have your splashy sales presentations for show, but handle the details and follow-up for your dough.