Differentiate or Die

How do you really differentiate yourself from your competitors? There are normally three types of competitors in a market.They are:

*The big solid national/global company.

*The small regional company with a good reputation.

*The small cheap competitor.

There may be several of each.Lets take a look at the most common combinations.

If you are the global leader, and you are competing against a good regional, they will say that you are too big and impersonal and have too much overhead.They will say that they are local and give personalized service.

If you are the global leader and are up against a cheap competitor, they will say that they do everything that you do but for less money.They will say it is because they have no overhead.

If you are the global leader against another global leader, they will try to differentiate with their product or solution, i.e.;develop better relationships with the economic buyer, say something negative about your company, or try to come in at a slightly lower price.

If there are three competitors, two global and one regional, the regional will say all big companies are the same and by so doing, actually reduce the competitive situation down to two choices, (big impersonal or small personalized).Meanwhile, the two big companies must compete against two competitors, the other big one and the regional.

Have you developed an effective strategy for each situation.If not, why not? Those of you who have been long time subscribers to Ray’s Rules have heard me say, “If you can predict it, then you can prepare for it.”You should be able to predict all the possible combinations of competitive situations in your market.Then, you should be able to brainstorm with your team to develop a strategy to deal with each combination.Lastly, you should then practice, including role play, executing each strategy until you can do them in your sleep.

I know that many of you are wondering if I have a solution for each combination.Of course I do and wouldn’t you think less of me if I did not do what I teach?If I can do it then you can do it.Here is an exercise to get your started.Think about how you would sell against your own company if you were each competitor, and make sure that you include all your weaknesses.Then assume that is the presentation your competitors will use with each prospect, develop a strategy to destroy those presentations, and practice until it drives you crazy!You know that the presentation strategy you develop against yourself will be stronger than anything the competitor will actually use.Therefore, if you can come up with a winning strategy against your own presentation, it will certainly work with the less effective strategies of your competitors.

If there is enough interest, I will conduct a webinar on this rule.
The tuition will be less than $100.

Until next time. . .

Ray Leone

www.salesfunnel.com

ray@rayleone.com

PS:I have just returned from my trip to Madrid, Istanbul, Vienna, and Brussels.I am really, really happy to be home for a few weeks.

PPS:My May Boot Camp is sold out again.Thank you all for your support.It is greatly appreciated.If you know of a company in need of my services, please put in a good word for me and pass along Ray’s Rules to them.

Whole Brain Selling

There has been quite a lot of information and theories published on Left Brain/Right Brain leadership. In fact, my latest leadership course has a section on Left Brain (systems, processes, skills) and one on Right Brain (motivation, trust, empathy).

However, not much has been published on how to sell to the whole brain. Left Brain is logic and Right Brain is emotion. On which side of the brain does your sales strategy focus? Have you thought about it? How much more would you sell if you could sell to the side of the brain that your prospect uses to make decisions?

Selling to the Right Brain requires you to be a story teller because Right Brain people think in stories as they relate to emotions. Think about the commercials of Folgers Coffee and Master Card.  What are they selling? It is not coffee and it is not 21% interest rates. It is love of family and magic moments that are priceless.

When President Obama was selling “Obamacare”, he was not selling the cutting of Medicare by 50% or tax increases. He sold the story of a young boy whose mother died without proper medical care. He was tugging at your Right Brain to override the logic of your Left Brain.

What are you selling? If you are selling 21% interest rates instead of selling magic moments, then you are missing a lot of sales.

Till next time,

Ray Leone

www.salesfunnel.com

ray@rayleone.com

Lagniappe

Lagniappe is a popular term in customer service circles. It means giving a little extra, especially when unexpected. Most organizations know the definition, but few practice it. It may be the number one way to increase customer satisfaction. I just returned from a poker tournament where I experienced lagniappe. This tournament was an invitation only free roll tournament, which means that it was free but you had to be invited and first prize was $15,000 cash. Oh, and did I mention that the room was also free. But none of that was the lagniappe. All of those things were advertised and when you receive exactly what you expect you are a satisfied customer. But your goal should not be satisfied customers. What you should be striving for are advocates. An advocate is someone who goes out of their way to sing your praises because you exceeded their expectations.

Back to my story. When we registered for the tournament we were given our choice of a watch (which was my choice) or a World Series Of Poker Chip set. What a wonderful surprise. The retail value is probably $100 and they gave away a thousand of them! Now Harrah’s in Las Vegas has a thousand more advocates than they had a week ago. How many advocates has your company added to its customer list this year?

What would Harrah’s have gained if they advertised the free watch? Almost nothing. Maybe, even a few customers may have complained that the watch was too cheap, lousy design, etc. But by holding something back they surprised us with something we did not expect.

Till next time

Ray Leone

PS- The greater the sales skills, the lower the customer expectations.

The lower the sales skills, the higher the expectations.

www.salesfunnel.com

ray@rayleone.com

Beware The Cheap Price

I had just completed dinner in a Shanghai restaurant and was reading the local newspaper. On the front page was an article about swill oil. It turns out that swill oil is used oil that is to be recycled for fuel but often finds its way back in to the kitchen. It is filtered and re-bottled and sold as new oil for a 200% profit. The article further stated that as many as one in ten meals in China is cooked with swill oil. Oh, and did I mention that swill oil is loaded with carcinogens?  My stomach started to feel strange. Then I turned the page and the next article was about recycled paper products. Specifically, paper plates, cups, and plastic forks. The article cited two of the largest restaurant chains in China as users of these products. Oh, did I mention that they are loaded with carcinogens?

My stomach is feeling worse just writing this Ray’s Rule. I am sure you have seen the reports on Chinese sheetrock. Not only does all the sheetrock have to be removed from the homes that have it, but most of the plumbing and wiring also has to be removed. This is not a slam on China. That these articles were in a Chinese newspaper was a big surprise to me. Many of their products are fine. The Yugo car was the cheapest car ever built and was also a disaster. What is my point? We need to make sure that we convey to our prospects the risk of buying cheap.

Do not be afraid of your price. Be proud of it and learn how to sell your product’s value. I try to always use a combination of the carrot and the stick. I highlight all the benefits of buying from me and I also highlight the potential dangers of buying the “cheap alternative”. Every buying decision is a risk/reward decision. It is seldom worth the risk of buying cheap for the small reward of saving a few bucks.

My next trip takes me from Hamburg to Madrid to Istanbul to Vienna to Brussels. This trip is mostly leadership training for senior executives. I am sure I will have some interesting experiences to share with you when I get back. I just hope they have nothing to do with food.

Till next time

Ray Leone

PS- Thanks for sharing Ray’s Rules with your friends and colleagues. Our subscriber base is growing.

www.salesfunnel.com

ray@rayleone.com

The Personal Touch

A few days before I went to South Africa, I received a call from an old client that was also a friend. I hadn’t heard from him since I last spoke to his group. I asked him why he was calling and he said he just wanted to let me know that I was a great guy and that he was there for me whenever I needed him. He then offered to take me to his farm to do some hunting and then he offered to help me on my property. While In Africa I received a response to my last Ray’s Rule from a great guy that I met at the Jersey Boys seminar. If you recall, I asked for suggestions for topics for Ray’s Rules and his suggestion was that we should not forget the personal touch. He reminded me, (I did need reminding) that too often in this high tech world we have replaced face to face interaction with Skype and hand written letters with emails.Social Networking has its place, but don’t let it replace the personal touch. He wanted my thoughts but I think his are better than mine would be.Here is his recommendation in his words:

“Happy New Year and thanks for the latest Rule.  I hope things are well with you and family.  A good topic would be the proper use of electronic technology in sales.  Too many times I see sales people take themselves out of the relationship equation by relying too much on social media tools like e-mails, linkd, facebook, and twitter.  These items are great for instant contact, but rarely do they lead to real relationships.  It is still important to write letters, have telephone conversations, and meet face to face.  Social networking will never replace one on one in building the true relationships that lead to making the big sale.”

Roosevelt Heyward, III

President/CEO

______HFA__________

Haywood and Fleming Associates

Thank you Roosevelt, your friendship is valued.

Till next time

Ray Leone

PS Boot Camp for 2nd week of May is sold out.  We are considering one for 3rd week of May. Let me know ASAP if interested.

What is your BATNA?

Your BATNA is the Best Alternative to a Negotiated Agreement.

If the client will not allow you to pass on your increased cost to him, what is the best alternative? Is it to terminate the contract or is it to eat the cost increase yourself? If you are asking for a promotion or a raise, do you have another job lined up? You must determine your BATNA before you sit down to negotiate with someone. You have more control and power when you have a satisfactory BATNA. Many times your BATNA is a better action than making a concession that can hurt your reputation or the profit of your company.In a previous Ray’s Rule I said that you should never enter into a contract with which you would be angry to fulfill. Instead, choose you BATNA . You will happier and more productive when you do.

Till next time
Ray Leone

The RR Factor

Do you have the RR factor? RR is short for Rubber Rear. The higher your RR factor, the quicker you rebound from setbacks. It is one of the most important traits of a salesmaster. We all lose deals. The question is, what do you do when that happens? Do you analyze the results and do a fishbone of the entire pursuit to determine what went wrong, so that you can learn from it? Does it make you want to try harder the next time and anxious to get out there as soon as possible to implement your new found knowledge? If you do, then you are a salesmaster.

However, if you feel like you lost a member of the family and shutdown for weeks, then work at developing your RR factor. How do you do it? Like so many things in life, it is simple, but difficult, to achieve. All you have to do is follow the above process of the salesmaster. Use the outcome as a learning experience. Get angry! Get moving!Get motivated! Celebrate losses because they mean you are closer to a sale. If your closing average is 25%, then you lose three out of four times. That means you need three “no’s” to get to a “yes”. Instead of mourning the loss, think of it as a step closer to a sale. Remember failure is an outcome, not a person.

Till next time
Ray Leone
PS The mid May boot camp is already sold out.
We are considering adding one the 3rd week of May.
Let us know if you want to attend.

WHAT RATIOS ARE YOU GOING TO IMPROVE, IN 2010, TO GET BETTER RESULTS THAN YOU DID IN  2009?

Resting on your laurels is not an option in sales.  In many professions, one big idea can carry someone for a career. In entertainment, a single hit record can make you famous. But in sales you must prove yourself every day, every week, every year.  That is what makes you special. Most people can‘t take the pressure of having to continually perform at a high level.

If you had a great year, you must improve your skills to repeat it because your competition is upgrading their skills. If you had a less than stellar year, then you have to identify the reasons why your performance was not what you wanted and lay out a game plan to improve your performance.

There is no magic bullet. If you want to earn $200,000 in 2010 and your average commission is $5,000 then you must close 40 deals. If your closing average last year was 20% and you earned $100,000 then you must see twice as many prospects or increase your closing average to 40% or some combination of the two.

What is your plan? And as the book says, “Hope Is Not A Strategy”.

Let’s refer to our Italian friend, the great Pareto. You know, the guy who came up with the 80/20 rule. If you want a different result, you must replace activities that bring you pleasure with activities that bring results. Rarely are they the same activities. For instance, if you enjoy playing golf you may have to play fewer rounds and spend that time prospecting or practicing your presentation. Analyze all of your ratios (leads to appointments, appointments to presentations, presentations to sales, referral sales to non-referral sales, average contract size of wins versus average contract size of losses) and then target the ratio that will give you the most dramatic improvement in results. Decide today how much time you are going to devote to improving your performance. Then do it!!

Happy New Year

Ray Leone

PS – Email me if you have a topic that you want me to address in Ray’s Rules.

PPS – I’ll be in South Africa next week. The next Ray’s Rule will be when I return,  assuming I don’t get eaten by a lion.

Sometimes The Economic Buyer Is Not The Best Person To Call

Most sales pros, including yours truly, are constantly telling salespeople to try to initiate contact with the economic buyer. However, sometimes it is better to initiate contact with someone at a lower level. The person that owns the problem, that your product or service impacts, is often a more receptive audience.

Example: If I am the maintenance engineer at a manufacturing plant and responsible for keeping the production line running, then any product or service that helps me do that would be of interest to me. The plant manager, who would be my boss and the economic buyer in this example, may not care because the line never goes down. He doesn’t know all the stress I am under and long hours that I have to put in to maintain the line. Therefore, he would be less interested in speaking with you than I would.If you can get to me and convince me that your product will make my life easier, then I will be motivated to get my boss to listen to you. Sometimes it is better to light a fire low so that the flames creep up.

A real life example occurred when I was trying to sell my services to a university. The president of the university was the economic buyer, and as most economic buyers, had gatekeepers that kept me from personally contacting him. I am sure this has never happened to you.The service that I would render would increase donations from alumni and would directly benefit the athletic department.So I met with the athletic director who needed increased donations to fund his expansion plans for the athletic department. Once I convinced him of the value of my proposal, he had the university president meet with me. And you know the rest of the story….

If you have been trying to penetrate an account and have not been able to get past the gatekeepers, maybe it is time for a new strategy. Identify the owner of the problem and target them instead of the economic buyer, and your results may improve.

Till next time

Ray Leone

www.salesfunnel.com