Why Discounting Your Price is the Wrong Strategy

One of the common responses to a tough selling environment is to let anyone on the sales force can offer a discount.

When you discount your price it's usually because  you are either under time pressure or you have not done a good enough job laying out the price/value relationship.  

Let’s look at both of these issues.

Discounting Price Because of Time Pressure

First there is the issue of discounting due to the time pressure of such circumstances as needing to make a quarterly number or liquidate inventory.  In these and similar situations, you’re not only signaling your methods to immediate customers, but you’re also signaling future customers.
Look at the automotive industry and how people buy cars.  The auto industry has conditioned the marketplace to buy a new vehicle at the end of the month when they’re all chasing their monthly numbers.
Does this result in more cars being sold? No. The only thing it does is accelerate a purchase, but it does so at a discount.  Ouch!  Lost profit.   If you add up the total sum of month-end discounts being given, there is no way it equals the extra mythical profit of a few accelerated sales.  Keep in mind too that those sales likely would have come in the following month or two anyway.
The example I use is autos, but look at your own industry. What signals are you and other salespeople sending?  What games are being played?  And for what reason do you believe incremental profit is being generated?  If you run the numbers, I think you would discover you are not gaining anything by consistently discounting to close sales.

Offer Value, Not Discounts

The bigger argument about price discounting is also the most simple.  Discounts are given because the selling process lacks the focus it needs to create real value for the customer.   Salespeople are the first to yell how they are losing sales because the price is too high.  This argument is so lame that it borders on ridiculous.
Salespeople are yelling this because they don’t want to admit their own selling process is ineffective.  Rather than saying it’s their fault, it’s easier for them to blame something else. The scapegoat is usually the price.
Yes, setting the right price point is a delicate process, but all this work gets wiped out by a panic attack of trying to close a sale.
A salesperson should not attempt to close a sale until understanding at least three of the customer’s needs or desired benefits. Remember, a customer will pay an amount equal to the level of need they have.   Put another way, consider this: If there is no need, then why should they even buy, let alone at full-price?
Many salespeople are diligent in making sure they are selling to someone empowered to actually buy.  Identifying a decision maker, though, is only one aspect of the selling process. The salesperson must be confident in establishing a relationship between the price and the value of the product or service being sold.
When I say “value,” I’m talking about the value as determined by the customer, not the salesperson.   The problem is many times the customer doesn’t understand or know how to grasp the full magnitude of their situation. Salespeople need to uncover those needs and sell to the outcome, not to the feature.
An example I like to use is a company looking to buy tablets for some of their employees.  One company might be buying the tablets to provide people who occasionally travel with a more portable way to work away from the office.   Another company might be looking to buy tablets for salespeople to use in multi-million dollar presentations to senior level executives.
Both companies have needs, but most likely the second company is looking at a larger outcome.  If you the salesperson only knew the customer was looking to buy tablets for some employees, you might view the price as “x.”  On the other hand, if you knew the impact the use of tablets could have on the customer’s business, then you would immediately realize the value to them is much greater.

What About Price Integrity?

There are some of you reading this right now and wondering, “What about price integrity and the need to treat all customers equitably?”  Yes, that’s correct and I do believe in pricing integrity, but let’s not forget the customer in the equation.
In the end, it’s the customer’s level of confidence that is going to determine pricing integrity.  If you price at different levels by customer group, but can back it up with valid reasons and a sound selling proposition that allows the customer to achieve their desired outcome, then you have pricing integrity at whatever price being paid.
Just remember that discounting is not a strategy that is effective in the short or long term. Focus on your selling proposition and uncovering at least three needs or desired outcomes of the customer.
When you do this, you will be able to present a full-value offer and protect the profit that otherwise would be lost to discounting.

5 Warning Signs of CRM Readiness Syndrome

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Today, many small business owners are suffering from a syndrome that, while treatable, can hamper the future growth of their business. Common symptoms include unexplained lost deals, a vague feeling that leads are falling through the cracks, and a frustrating inability to get a view into their sales pipeline.
While most shrug these symptoms off as just the way life as a growing business, others look for relief in the wrong ways…working longer hours, creating yet another spreadsheet to track data, drinking more coffee. Few people talk about it openly.

Fortunately, there is relief. It is called CRM – Customer Relationship Management. A CRM system can alleviate many of the headaches that come with managing a small business that is poised for fast growth.
Don’t wait until it’s too late and your pain spreads to the rest of your team — or worse yet — to your customers.

Take our 5-point diagnostic check-up to see if you suffer from CRM Readiness Syndrome.

Do you…

1. Struggle with time?

The first sign of CRM Readiness Syndrome is finding yourself wishing you had more time to focus on what you do best – selling your product or service to prospective new customers -- and less time spent on administrative tasks such as managing your sales team's progress or looking for customer information in multiple locations.
Remedy: A CRM system can give you one source of truth for all you customer data, in real-time, to help your teams stay connected.

2. Struggle with revenue?

As symptoms develop, you may start to have increasing concerns about how to grow your revenue without growing your sales team and expenses.
Remedy: A CRM system can give you insights to find new customers like your best current ones, and mine archived opportunities. 

3. Struggle to grow your customer base?

As your readiness for CRM develops, you may notice that you are wasting precious time on your most vocal or familiar customers, and ignoring potentially high value customers who need attention.
Remedy: CRM can help you focus on data-driven insights to help close more profitable deals.

4. Worry about retaining your current customers?

Anxiety about keeping your current customers happy is common in today’s competitive economy. Customers have endless choices today, so creating loyalty with your highest value customers is crucial.
Remedy: A CRM system can help you communicate with existing customers at the right time in the right channel with the right message to keep them coming back and, better yet, become an advocate of your business.

5. Need more visibility into your business?

Nothing causes stress like not being able to predict where your business will be at the close of the quarter.  Do you know which sales team members are closing the biggest deals? The status of opportunities in the pipeline? When you experience this most painful of symptoms, you'll know its time to act.
Remedy: A CRM helps you keep track of data to make actionable decisions and course-correct when needed.

If you've experienced one or more of the symptoms listed above, you may suffer from CRM Readiness Syndrome. Fortunately, relief is in sight. The right dose of CRM can address these symptoms and ready your business for future growth.

What are some of your common "growing pains" that you face as a business? If you already use a CRM system, how has it alleviated your headaches and helped you become a healthier business?

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Tips For a Strong Close to Your Sales Quarter

The end of the quarter is fast approaching. And for sales professionals there are only two outcomes.

Will you finish in the red, or in the black?

Winning near the end of a quarter is a trait of all the best sales people I’ve ever met. And while closing out strong is primarily the effect of a consistent quarter, there are still a handful of things you can do to strike off checkboxes in the win column.

We consulted with sales closing expert Trish Bertuzzi of The Bridge Group and she offers up some powerful tips to help you close your quarter strong.

1. Be Direct 

There’s no substitute for being pleasantly persistent and respectfully blunt. Get out there and be straightforward. One of Trish’s favorite questions is to ask customers is: “If you were me, would you forecast this deal to close this month?"

Remember, the shortest distance between two points is a straight line. Being direct will help you get real with your customer and align yourself with the true sales cycle. It might also enable you to pull out a quick win.

2. The Quid Pro Quo 

Prospects are always asking for ‘extras’ like discounts, special service, or that unique integration quirk. Even if these requests are within the scope of what you’d typically provide, respond with a “yes - if request” from your end.

It could work like this: “If we give you those terms, then we’ll need you to authorize the deal by the end of the quarter” or “I’ll talk with my manager and if she greenlights these provisions, could we have the purchase order by Monday?”

3. Use Your Executives 

Another surefire strategy Trish employs is using your executives to call your prospect executives. This tactic may enable you to get a deeper sense of the deal and what can be done to close it by quarter’s end. Your executive team can be a very effective and persuasive resource for you - use them.

4. Stack-Rank Your Prospects 

We will never be able to manufacture more time, but we can manufacture more focus. Trish recommends looking at your pipeline and grading each opportunity on a scale of 1-4 with 4 being “highly closeable by the end of the period.” Then, focus your closing efforts on the 3’s and 4’s ONLY. You don’t have time to waste.

5. Purge Your Pipeline 

Almost every sales pro has them. They’re those big opportunities in the pipeline that you’ve been working for months. Everytime you think about killing them, you get a glimmer of hope.

Remove them.

They don’t deserve to be on your radar right now. Coming clean with yourself will open new vistas and invigorate you to add more productive opportunities to your pipeline.

6. Start Planning for Next Quarter 

How much revenue do you plan to book next quarter? And exactly how many new deals do you need to earn that? Knowing exactly what you plan to earn acts like a magnet that attracts business your way. Having this exact number also allows you to project your required activities into month one of the new quarter.

If you’re accurately measuring your deal metrics, you’ll be able to predict with some certainty how many calls, emails, demos, or opportunities you’ll need to make it rain.

One last suggestion: ask for a review by management. Knowing your numbers is one thing, but to positively affect the business, it’s equally vital to understand your ongoing culture fit and progression opportunities.

Bonus Tips: What NOT to Do at the End of the Quarter

1. Do Not Bring on Bad Fitting Clients Just to Make your Numbers 

Any client outside of your ideal customer profile will complicate servicing, produce a higher likelihood of churn or failure, and ultimately cost you more time and resources than it will be worth. Instead, focus on filling the pipeline with high quality leads for next quarter. It’s never too early to start filling the funnel.

2. Never Give Away More Than You’re Comfortable With 

It’s just not worth it. You only have one reputation for your brand and offering, treat it respectfully. Concessions can quickly become a crutch that hides other issues. Sell on value, not on price.
The key to closing out your quarter strong is to keep up the momentum that got you to where you are now. If you’re struggling to meet your numbers, it’s a time to embrace new sales insights and start building effective rhythm.

Take the last minute shots on goal listed above, but remember to always be thinking about the bigger picture: Your reputation is the product of your past actions. Sales that allow you to produce predictable revenue are the future.

How to Conduct a Sales Discovery Call

When a potential customer agrees to a discovery call or first meeting, it is paramount to maximize that time. Are your discovery calls launching a business relationship, or failing to connect? 

The best discovery calls build rapport, generate trust and help buyers make informed choices. The key to a perfect sales discovery is excellent preparation. Here are eight items to focus on:

1) Do Your Homework

Zero in on what sparked their willingness to speak with you, and review your lead tracking system for all related data. Spend ten minutes exploring their company website, community forums, and social media channels.
TIP: Research four names of people in your prospect's department on LinkedIn prior to your call.

2) Focus on Their Needs

Put the spotlight on your prospect’s issues and establish yourself as a valued resource to help them make the right decision when they’re ready to buy.
TIP: Let them do 80% of the talking. Favor listening over pitching.

3) Ask Upfront Questions about Buying Ability

Get to the bottom of timeframe to purchase and decision-making while steering around budget allocation questions. If they need it, they’ll find a way to pay for it.
TIP: Directly ask questions like, "When are you looking to have these improvements in place?"

4) Share 2-3 Benefit Statements

Make a direct impact with 2-3 benefit statements relevant to your prospect's pain points. Select specific topics based on what you've learned.
TIP: Think "how," instead of "what," in your delievery. List the steps in your process of working with clients to explain how your company helps customers.

5) Get Your Prospect to Elaborate

Enable dialogue, and avoid dominating with a presentation. Think two-way conversation, and ask, “why?” to learn the true meaning of their needs.
TIP: For every statement they make, ask three questions to expand on the topic.

6) Provide Solutions to Objections

Know the difference between an objection and a question that’s a desire to learn more. Clarify issues and illustrate how your product or service will address their concerns.
TIP: Regularly rehearse up to twenty possible objections and handling tactics. Anticipate possible objections prior to each discovery session.

7) Establish Understanding and Agreement

Restate details of your prospect's needs and understanding of how you help their business. Use notes jotted down during the call.
TIP: Outline expectations, outcomes and a timeframe for moving forward in a concise Letter of Understanding (LOU) as a follow up message to your prospect.

8) Measure Success! 

Create business metrics that allow measuring the time between sales stages. Generate customized pipeline reports based on discovery call criteria.
TIP: Add checkboxes in your account records to get more specific in filtering information in reports.

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20 Motivational Sales Quotes to Amp You Up

I just finished reading Dan Pink’s latest book, “To Sell is Human: The Surprising Truth About Moving Others,” in preparation for his Sales Performance webcast.  In the book, Dan slams old school sales tactics and reveals why knowing how to move others is crucial in today’s digital era.

 So I felt inspired to compile a list of my favorite sales quotes to get you and your sales team moving for the week. Plus, it's Tuesday afternoon – not quite midweek yet – so I’m sure you can use some motivation too! Feel free to bookmark this post – and come back to it whenever you need a boost of motivation. Enjoy!

20 Motivational Sales Quotes to Amp You Up! from Salesforce

5 Business Success Tips from Cake Boss

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When Buddy Valastro’s famed Hoboken New Jersey shop, Carlo’s Bakery, opened their doors over a hundred years ago, they tracked each of their orders on a single piece of paper, and back in 1910, that worked pretty well. The only problem was, when Carlo’s hit the big time in 2009 with a hit reality show, Cake Boss, they were still taking orders the very same old-fashioned way.

Here are five takeaways from Buddy about the difference between doing business using the old-school version, verses his new online platform.

1. You can have your cake and eat it too

“The one thing I always wanted to do when I grew my business was to be able to maintain quality,” says Buddy. By creating an online platform for operating his business and taking orders using iPads, he’s actually been able to increase efficiency in terms of all the processes in the creation of cakes to deliver a more consistent product.

2. You need a back end engine for your cake to rise

When the business was still small, I was talking to Leo Minervini (now his CIO) and Leo said, “You’re getting so many hits on your website every week,” says Buddy. “I said, ‘I know, but how are we going to make the cakes?’ We needed an infrastructure to support a larger business.”
Carlo’s Bakery implemented a back engine in the cloud, what they dubbed “Cakeforce” to track every aspect of the bakery from production to delivery, so that they could scale their operations to a larger size, and improve communication between various people involved in the operation. Now, the business can support operations, such that they’ve been able to increase efficiency by 60% and begin national delivery of their products.

 3. Turn hungry fans into satisfied customers

With 366,000 Facebook fans, Buddy needed to find a way to capture those fans and turn them into customers. Using Salesforce Marketing Cloud, Carlo’s bakery staff can now interact with those same fans online through social, and when customer’s share their positive experiences about Carlo’s famous cakes, thousands of fans are able to hear about how much other people love their products.

4. Cooking reactively to proactively

In less than eight weeks, Carlo’s was able to turn what was a chaotic work environment into a proactive work environment, where instead of operating in a fog of confusion, there is now more visibility about what’s selling best this month, cannoli’s or fudge, and where the best profits are really coming from.

5. Delivering better customer experience

With 20 million dollars in sales annually today, Carlo’s bakery has been able to grow and at the same time deliver better customer experiences. Making cakes is a lot more complicated than it looks on the show, explains Buddy. “It’s the person who takes the order; it’s the person who makes the sponge, the person who fills it. The person who decorates it. The person who delivers it. It’s a lot of people who have to interact with this cake.” And that means a lot of room for error.
When Carlo’s used a paper system, they used to make mistakes, because every change had to be tracked manually, now by using a digital platform, not only are they getting orders out the door correctly, but the bakery has been able to enhance customer experience, and increase customer loyalty.

6 Tony Robbins Insights That Will Change Your Sales Game

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When it comes to helping people improve their lives there is nobody in the game with stronger credentials than Tony Robbins. The “Michael Jordan” of thought leaders, Tony has affected millions of people around the world through his performance coaching.

Tony has certainly made an impact on me. Last year Marc Benioff invited him to be the closing keynote at Dreamforce, the largest software event in the world. There he laid down sales coaching like I’ve never seen. Through his books, videos, and presentations, Tony gave us each new insights into effective selling.
Tony empowers his readers and audience to improve themselves. So we’ve scoured the web and found source after source of his advice:

6 LESSONS FROM TONY ROBBINS:

#1 Know Your Purpose
In your day-to-day sales world, you MUST have a sense of meaning. Walking into the office, grabbing a coffee, checking your email, and taking your day “on the fly” is just not gonna get it done. When you’re at the office everyday you have got to know what you’re going to get done that day. Knowing your purpose will make the biggest impact you can imagine.

# 2 Give positive meaning to everything
The sales rep’s life is all about risks. The more you take the more you win (and lose). It’s how you respond to the losses that makes you special. Keeping a positive attitude, regardless of the issue, will keep your head in the game and ready for the next opportunity.

#3 Realize that everything you do has a consequence
A sales rep's interactions with customers can either be positive or negative. There’s no neutral in sales. Every action you take matters. It’s not just about being on your best behavior, it’s about knowing your strengths and lining them up to reach your desired outcome.

#4 Know that everyone is unique, different, and amazing
Sales is a competitive world where people put themselves on the line every day. They often get shot down. Looking at the world through the lens that everyone has meaning will positively affect every facet of your performance. Don’t get deflated when buyers and competitors don’t behave like you want.

#5 Be driven by your desire for adventure
What drives you? Your past? Your competitors? Or even your fears? Or are you focused on your successes - on solving the next client problem and taking the next step for your company? It’s important to know what moves us and makes us do what we do.

#6 Expect the unexpected
What are you going to do when something unexpected happens in sales? By the way, something crazy always happens in sales. Why do you think we’re always the storytelling life of the party? When any situation arises, it’s important to respond with the right action that helps you solve a customer problem and take the next step.