Sales Blog with Professional Sales Tips

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Every customer you have was once a prospect. Either you, or someone in your organization, had to initially get a decision maker’s attention. The following are some things I have learned about doing it simply and effectively.

What I’m talking about here is what is commonly called an Elevator Speech because it represents how much time you have to show the prospect your value when you first meet. An elevator ride is usually no longer than 30 seconds, which should be the maximum length of your Elevator Speech.

I first met many, if not most, of my best customers in the most unexpected places (car dealerships, weddings, drivers license office, etc.) where having a good Elevator Speech in my hip pocket paid off. It can also be used effectively in routine prospecting.

Decision makers have two things you want: attention and time. You’ve got about 30 seconds to get their attention. Here are the basics to start crafting the two different types of Elevator Speeches that you’ll need (you’ll use one of the two depending on the situation).

1. Someone asks you what you do for a living.

a. Introduce yourself if you haven’t already. b. State one or two key standout value propositions that you and your company provide to your industry. Please do not sound like you are reading from the Yellow Pages. Boring! I do not believe these value propositions necessarily have to be unique in your industry; they just need to be compelling. c. Tell them the bare bones basics about your company and its products/services. d. Ask for their Elevator Speech, which will help qualify them and provide you with their contact information (not to mention that it shows you have some interest in them, which never hurts).

2. You initiate the conversation. Basically this just represents some important changes to the sequence.

a. Introduce yourself. b. Ask for their Elevator Speech. You can optionally skip the next two steps if they are absolutely not a prospect for you. c. State one or two key standout value propositions. d. Tell them about your company.

This is one skill that requires a lot of practice. My wife used to make fun of me for practicing my Elevator Speech prior to going to a prospect rich event until she saw the positive results. I eventually even got her to play the role of the prospect when I was practicing.

© 2008 Scott R. Sheaffer

For us to be most effective in attacking our target markets we must first define them and, secondly, be able to identify individual companies within them. This sounds really simple but it is amazing how many companies haven’t taken the time to do this.

One of the primary ways that we have traditionally identified markets and individual companies within those markets is by assigning them SIC codes. You remember SIC (Standard Industrial Classification) codes; they’ve been around since the 1930’s. The problem with SIC codes today is twofold. They were created when the U.S. was predominantly a manufacturing oriented country and SIC codes only have four digits, which can be limiting.

SIC codes needed to be updated to better reflect a changing North American economy and provide more options for classification. To do that, NAICS (North American Industry Classification System) codes were created and are replacing the old SIC codes. This industry coding system was jointly developed by the U.S., Canada and Mexico and has six digits. The Federal Government has been using NAICS codes since 1997.

NAICS codes can help us in several ways:

1. SIC codes are falling out of favor and are being rapidly replaced by NAICS codes. What a golden opportunity for us to take a fresh look at how we segment our markets.
2. Many industry reports that are now available either from public or private sources use NAICS codes. If we are still using SIC codes we won’t be able to use this new information very effectively as a benchmark for our own businesses.
3. NAICS codes can open our eyes to many service industry opportunities that were missing in the old SIC codes, which could play a prominent role in how we re-segment our markets.

CRM (Customer Relationship Management) systems are giving us increasing abilities to segment our markets through automation and NAICS codes are playing a key role. NAICS codes can be a very helpful tool in helping us focus our sales efforts. For a complete list of NAICS codes please see 2007 NAICS Codes.

© 2008 Scott R. Sheaffer

Allow me to introduce you to a tried and true warehouse operations technique that can also work beautifully in sales.

Have you ever heard the term Cycle Inventory or Perpetual Inventory? It’s a concept used by companies that have a large warehouse of goods that require a high degree of inventory accuracy.

Let’s say a company has 25,000 items that they stock in inventory. Instead of doing the inventory all at once they break it up into pieces and do a little each day.

If they wanted to inventory their entire warehouse every six months they would only need to inventory 192 items per day using this technique. They make it a manageable task.

Prospecting is no different. If we Cycle Prospect or Perpetual Prospect we can take a time consuming and challenging chore and break it into much smaller pieces. At the end of a month, quarter or year we can achieve some remarkable numbers without ever having to binge prospect.

Here are the steps to make this happen:

1. Calculate how many new customers we want to add in a month.
2. Calculate what our personal closing average is (i.e., for every 100 prospects we contact how many turn into customers?).
3. Divide the number of new customers desired by our closing average.
4. Take this number and divide by 22 (the average number of work days in a month).
5. This number represents how many prospects we need to contact each work day in order to achieve our new customer goals for the month.

Example:

Jill wants to add five new customers each month and her closing average is 10%. She takes the number of desired new customers (five) and divides by her closing average (.10) and the result is 50. Next she’ll divide 50 by 22 to see how many prospects she’ll need to contact each work day, and the result is 2.3. By contacting just 2.3 prospects each day Jill can realistically expect to add five new customers a month.

With discipline and time this technique can break down a sales chore into reasonable chunks and yield nice long term returns.

© 2008 Scott R. Sheaffer

When we are prospecting by phone, one of the most common dismissals we hear is for the prospect to say, “I’m familiar with what you do and we don’t need any of that product/service now.”

We’re left with the feeling that they actually probably don’t have the slightest idea what we’re selling. Frequently we’ll respond to this dismissal by forcefully trying to tell them about all the added value our company brings to the table.

The prospect becomes even more disinterested at this point, but there is a very effective and simple way to handle this situation by using the following question:

“Just so I can be sure we’re talking about the same thing, would you tell me your understanding of what my company does?”

Not only does this question pour water on the dismissal, but it gets the prospect talking. Note that this question is an open ended question which is effective at getting information from prospects and building relationships with them (our two main goals when prospecting).

Yes, I know, this question could potentially be viewed as a little offensive by the prospect. Your tone of voice and demeanor can soften how it comes across over the phone.

We all know that it’s easier for prospects to blow us off on the phone versus when we’re face to face with them. The prospect has already dismissed us when they tell us they know everything about us and don’t want any of what we sell. We really have little to lose by trying this effective response.

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

Chris R. of Lincoln, Nebraska submitted the following question, “Scott, I’d be interested to hear your take on leveraging social networking to develop prospects and clients.”

What a great and timely question. I’ve noticed recently that many sales professionals are not aware of how much things are changing when it comes to networking for business opportunities. I’m going to provide just an introduction to this important topic.

We’re all familiar with what I call “Legacy Networking.” This consists of schmoozing at your local chambers of commerce, leads groups and professional organizations. These forums work well, but there are new and potentially more effective ways to prospect using, you guessed it, the Internet.

MySpace.com and Facebook.com are the two giants in social networking on the Internet. These sites allow users to store all kinds of information about themselves and share this with others with similar interests. The only problem is that these sites have a social focus and not a business focus. They are trying to have more appeal to business professionals but still need further development in this area.

LinkedIn.com, Plaxo.com and Ryze.com are three social networking sites that are oriented toward business professionals. These sites can be a source for finding information about prospects. However, none of them are specifically designed to aid sales professionals.

Jigsaw.com is a social networking website that is specifically made for sales professionals looking for leads. It works like a leads group but with a lot more horsepower. You build up credits by submitting information which in turn gives you access to information. Because it’s web based the only geographical limit is the planet.

This site is an outstanding tool for those of us in sales and I would encourage everyone to take a look. The larger your geographic sales territory the more you could benefit from a site like Jigsaw.com.

We are in the early stages of social networking sites that are geared toward businesspeople. We are in even earlier stages when it comes to social networking sites that are specific to sales professionals. This is a trend that will continue and is going to provide tools that will ultimately change how we share information about prospects.

Thanks for your question, Chris.

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