Monday, January 31, 2011

Sales Prospecting Techniques: How Winners Prospect

If you are currently in a situation with a weak pipeline and few, if any, resources available to generate leads for you, you may have to do what so many salespeople avoid, and that is to prospect!
Effective prospecting is a critical component of sustainable sales success. However, prospecting is not selling. You may be a well-trained and/or experienced salesperson. But your training may not have included prospecting. Or perhaps you never prospected at all. In either case, read on.

The output of prospecting is a list of qualified leads that may buy your product or service. Selling begins only after a lead is categorized as qualified. If you start selling too early, you run the risk of pigeonholing your products and services before you have the opportunity to understand your prospect's requirements. That generally leads to commoditization--where price becomes the most important buying criteria.

Winners understand that, as with effective selling, prospecting should not be done by the seat of one's pants. You need a plan. That means an objective assessment of your situation, a goal, and resulting strategies and tactics to achieve that goal. So if you aren't comfortable with prospecting or haven't had to do it, I would like to share with you my plan that has worked for many of those winners:

When designing a prospecting process you'll need to take a comprehensive as well as objective look at your individual situation. Here are eight of the considerations for filling the "new business" pipeline:
  • What are the key characteristics of your territory? Customers, references, competition, supplier market share, etc.
  • Where and how does your product or service best fit? In which companies, markets, geographies?
  • To what degree is your company name or brand recognized by your potential market?
  • How effective have you been at prospecting? Do you have the skills, tools, and determination to make it work? Has your company provided the training you need?
  • What have been your traditional sources of business leads: blind RFPs, referrals, networking, business partners, your company's telemarketing function? What statistics can you find that will provide you with guidance on where your efforts should be best invested?
  • What has been your conversion rate? That is how many leads does it take to create a new customer?
  • How much potential business is out there for you, based upon your analysis of your territory?
  • What are your current time commitments to customers, internal meetings, etc.? Realistically, how much time can you dedicate to prospecting?
There is a new business revenue number to which you must commit --to your management and to yourself. You must be convinced, based upon your assessment, that this goal is achievable.

Winners will typically devise a number of strategies, which together provide the how--as in, "How am I going to achieve my goal of $3.5 million in new business this year?" Here are my 14 proven strategies:
  • Improve the skills you determined were weak in your assessment.
  • Ask every key person in every existing, satisfied customer for ideas on where you might find new business opportunities. It's important to reassure your existing customer that any new opportunities will not take away from the attention and value you provide to them now or in the future.
  • Target a list of say, fifty companies. You must be able to justify why every company is on that list based upon the situation assessment that you performed.
  • Commit to prospecting two to eight hours every week, depending on your pipeline. Lock in that time in advance and build the rest of your schedule around those regular sessions. Have (or find a way to have) the discipline to stick with your plan.
  • Qualify, qualify, qualify! I've seen salespeople waste incredible amounts of time trying to convince prospects to buy something from them without ever really asking the tough questions. A few of the key criteria in obtaining your leads are: identification of decision makers, current supplier situation, their financial situation, decision timeframe, and price as a buying criterion. Remember, "Opportunity may knock only once, but temptation leans on the doorbell."
  • Commit to following up. Lots of opportunities are lost because the salesperson gets distracted or simply does not keep on top of potential business opportunities. Have your follow-up materials at hand and make sure you record next steps into your calendar, CRM software or contact manager.
  • Make prospecting a quality, not a quantity effort. Sure, you are going to have to make a certain number of contacts, by phone, by mail, in person to come up with one good lead, but if you focus on activity rather that productivity, you'll be left with very little for your efforts. After all, you most probably don't get paid for the number of calls you make. You get paid for how much you sell.
  • Make it a practice to do some research on every company which you target to prospect. Winners look for information about the key executives as well. There is plenty of valuable information about this and other strategies listed in my archives. Click here to view past issues.
  • Get your messages and talking points down cold. Those messages must include value statements that will provoke interest or action at each level of contact you have with an organization. Don't be afraid to use a script. However, if you do, make sure you are so familiar with it that it absolutely does not sound as though you are reading it.
  • Decide in advance whether you are going to leave a voicemail message for people you can't reach and what that voicemail will contain.
  • Be prepared. Make sure you know and have responses to all the common objections posed by your potential customers. Those should gracefully be turned into benefits wherever possible.
  • Provide value at every point of contact. Think: Why should this person speak with me, provide me with information, meet with me, buy from me?
  • Take notes. Record key points. It will improve your efficiency and build your credibility with prospects when, during the next call, you can recite what they said last time.
  • Invest the time for tracking and measurement. You can't improve what you don't measure.
Tactics are the actions, tasks, efforts you have to take to execute your strategies. I suggested above that improving key skills required for prospecting might be a necessary strategy. Planning, questioning, listening, Internet research, relationship building, networking, and telephone skills are all critical for effective prospecting. If you are not where you'd like to be in any of these, or other areas, put a plan together to get the required education, training, or coaching. If you don't, you are limiting your success and your income.

If you don't like to prospect or have convinced yourself that you can't do it effectively, get out of your comfort zone and try the approach I outlined above. It will make you money!

Thanks to Dave Stein  of Side Road for his insights.