In the previous article, I talked about the value of prospecting for new accounts. I pointed out the reasons salespeople should constantly be on the lookout for prospecting opportunities.
All prospects, however, are not equal. Some are better than others, either because of the potential they represent or the ease with which you can obtain their business. These differences among your prospective accounts bring about the need to make difficult decisions regarding the time and effort you will expend to turn a prospect into a customer.
If these decisions are to achieve good results, they must be preceded by solid preparation and based on accurate information. The guidelines that follow will improve both the quality of your decisions and the efficiency of your actions by forcing you to approach prospecting logically and wisely. The first thing you must do is to expand your view of what a prospect is. You can do that by thinking of prospects in a kind of hierarchy.
THE PROSPECT HIERARCHY
In the broadest sense, a prospect has a current or future need for one or more of your products or services, but does not purchase then from you. This definition is, however, a bit “clinical” and offers little in the way of motivation. To rectify this, let''s sharpen the definition so you have something to focus on as you go about your work of prospecting.
A prospect is a legitimate potential customer. By “legitimate” I mean that the prospect has a real need for your products or services. By “potential” I mean that the prospect does not now buy the product or service in question from you. And I use “customer” to provide you with a goal, something to shoot for. Prospecting is demanding and often frustrating work for salespeople; and by referring back to this succinct definition, you can both motivate yourself and keep things in perspective.
Since all prospects are not equal, let''s examine the most obvious source of differences among prospects and establish a hierarchy of prospects based on these differences.
Current customers
This first and most obvious place to look for prospects is among your present customers. This suggestion might surprise you, but think about it. It''s unlikely that you are selling all of your customers at their full potential. For some, you represent only one source among several; for other, you may supply only a few of their product needs. In fact, unless you have an unusually close and long-standing relationship with a customer, you can always sell more to him or her.
I place current customers at the top of the prospect hierarchy for one reason: You already have an existing sales relationship with them and consequently they represent little risk. And risk, real or perceived is always the biggest obstacle to converting a prospect to a customer. Because you have established trust and credibility with your current customers (or they would not be customers), you also have the access and the means to lessen the perception of risk further.
Look at each of your current customers and ask these tough questions:
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Why are you selling them at less than their full potential?
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Are they aware of your full range of products and services? Do they buy any of these from your competition? Why?
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Has anything changed since their most recent decision to buy from your competition? Describe these changes, their causes and how you can capitalize on them.
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Describe their purchasing decision-making processes. Are they centralized, decentralized or compartmentalized?
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Do other units of the customer''s organization have product needs that you are not currently fulfilling?
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Do you have access to all decision makers and key influences? If not, how can you gain access?
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Can your current customer contacts provide referrals to others with purchasing responsibility? Have you asked?
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Have you slipped into complacency? Are you content with the base of business you now have and unwilling to pursue expansion?
This last question often generates the most surprising responses. When I asked this of one salesperson, he responded with, “I''m getting a lot of business from these people. I don''t want to upset the apple cart by pushing too hard.”
What a truly amazing statement! It''s really an admission of guilt or, more probably, fear. And it''s an irrational fear because it stems from the false assumption that a customer who is happy with what he currently buys from you will, for some strange reason, react negatively if you attempt to expand your business. The comment about “pushing too hard” also betrays a fear because it, too, is inaccurate. Current customers, because of your established relationship with them, rarely, if ever, require a “hard” sell.
When prospecting, you should look first to your current customers and then to yourself. Use your existing relationships profitably and watch constantly for new sales opportunities.
Former customers
The next most obvious prospect candidates are former customers; those who once purchased from you but for some reason stopped doing so. Because of the memory of past problems, former customers present a distinct challenge, one heightened by the presence of a competitor who filled the void created by your absence. Before pursuing their business, however, you must first determine why they are no longer customers.
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Why did they stop buying from you? What specifically led to their decision? Product or technical reasons? Financial reasons? A change that eliminated the need for your product: Competitive reasons (price, quality, delivery, service)?
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What about decisions made by your company? Many suppliers have consciously, or as a result of policy changes, effectively cut off certain customers. These actions often generate ill will and are not soon forgotten.
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Are personal considerations involved? Did a key individual have a conflict with someone from your company?
Once you have determined why your company lost the business, you need to find out whether these reasons still exist. Most companies react reasonably well (if too slowly) to serious problems affecting customer satisfaction, and your company is probably no exception. In most instances, the problems or conditions that caused past difficulties have been corrected, but the customer won''t know this if no one has informed him. Simply informing the customer, however, isn''t always enough. Be prepared to offer proof in the form of hard evidence that you can share and discuss.
If you were not personally involved before, you should talk to those who were. Find out how people in the customer''s organization felt about the situation. Were they angry or simply disappointed? Does the customer deserve an apology? Was one ever given? It''s never too late to apologize! Sometimes this, in itself, can get you in the door and allow you to present your case.
If the problems were not corrected, you have an internal selling job. First identify those in your company who can solve the problems or bring about the needed changes. Then convince them to act. This demands that you do more than just tell them. It demands real selling. Be prepared to offer alternative approaches to the problem and to prove the business and personal benefits that will result from making the change.
When dealing with a former customer, beware of your human tendency to see the account as it used to be and to assume that the decision makers, key influences and purchasing criteria have remained static. Companies, market conditions and people change over time, sometimes rapidly and radically. Don''t approach the account the way you or your predecessor did before. After all, it wasn''t very successful, was it? Treat former customers as you would a new account. Show that you recognize the changes and growth they have undergone. Emphasize that you and your company have also changed for the better and are now in a position to help them in ways you couldn''t in the past.
Interested (active) prospects
This category encompasses those who have shown an active or obvious interest in your company and its products but have not yet purchased them. Their interest might be expressed any number of ways: a response to an advertisement; an unsolicited telephone call or letter requesting information; a positive response to your telemarketing effort; an obvious willingness to give you a timely appointment; even second-hand information (if the source is reliable) from someone who has had contact with the account.
Don''t delay with these prospects. Approach them now! The fact that they have expressed an interest means two things: 1. They have a current problem or need that they want to solve or satisfy; and 2. They have probably contacted your competition as well. The open door also means that they will usually be willing to discuss their problems and needs openly. Take advantage of this and come prepared to listen and to learn.
Disinterested prospects
These are prospects that, though not expressing open interest, have an obvious need and are probably familiar with your company and its products. It includes those who buy from your competition; those whom you or others have previously called on without success; and those prospects who once expressed interest, but received little or no follow-up from your company.
Prospects who fill the last category probably believe (quite rightly!) that they have been ignored. Make no excuses. Apologize for the oversight but don''t dwell on it. Put it behind you and then move on to the selling job at hand.
Disinterested prospects are among the most difficult to approach. Their lack of interest means they are likely satisfied with their current supplier and see no reason to change. For some this translates into a reluctance even to grant an appointment. Your initial goal, then is to come up with a reason that will make them want to see you, a real challenge to your creativity. But once you are in the door, the important thing is to get the prospect talking. Don''t be surprised if he or she seems hesitant or unwilling to discuss current problems or needs. After all, the prospect knows little about you.
You should avail any form of high-pressure selling with the disinterested prospect. Such tactics usually accomplish little except to reinforce the existing barriers. By moving straight into your sales presentation, you only confirm what many customers already believe — that most salespeople are concerned primarily with selling and not helping.
Before addressing your offerings, you must establish some degree of trust and credibility. Show a willingness to learn about the prospect and his company. Develop open-ended questions in advance that will lead the prospect to bring up his concerns. Stay clear of direct comparisons with your competition, at least for now. There will be plenty of time for that after you learn which areas represent real concerns.
Once you have a sense of the prospect''s problems and needs, show by your attitude and words that your driving goal is to help his company either by solving his problems or by saving him money. Use these identified problems to make logical references to the real benefits you can provide. If necessary, ask your contact to set up a meeting with key personnel and decision makers and don''t neglect to show how this can benefit him or her personally. Because account penetration is critical to success with the disinterested prospect, don''t hesitate to ask permission to approach others in the organization — people from operations (users) or technical or other influences. Even their sales and marketing people are fair game. They present an excellent source of information on their customer''s problems and needs, and they can sometimes act as another access point to decision makers.
Your initial calls on the disinterested prospect should therefore be designed to:
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Uncover the information you need to address their current high-priority problems.
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Qualify the individuals in the account by identifying decision makers, key buying influences and sources of information.
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Increase the prospect''s comfort level with you and your company.
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Move the prospect into the interested category so he/she will be more open and allow you to help him/her.
Unknown prospects
Concerning these, about the only thing you can say for certain is that you know or suspect that they have a need for your products. NO salesperson from your company has ever called on them or, if one has, it was so long ago as to be meaningless. Do not, however, ignore prospects just because they fall in this last category. You want to move them up a few levels to the interested category, and you can''t do that unless you make contact.
You can be certain that a number of these unknown prospects are having problems with which you can undoubtedly help. Some, in fact, will probably display real interest once they see what your offerings can do for them. Many companies, even some of the largest, make poor purchasing decisions simply because they are unaware of the available alternatives. Your job is to heighten that awareness, to bring them useful knowledge. When dealing with prospects, regardless of how you categorize them, if you determine that they have a need for your products and services, and if they are not currently buying from you, it''s not their fault. It''s yours. You simply have not sold them.
THE HIT LIST
Prospects can be divided into distinct categories, each with their own needs and traits.
- Current customers
- Former customers
- Interested prospects
- Disinterested prospects
- Unknown prospects