I am still getting over the shock of Geelong getting smashed on Friday night against Collingwood..
(I actually had to re-watch the first quarter to study what the difference between the teams really was.)
But more on that later..
Sales Training Lessons from this week in the land of Blue Rocket Sales Breakthrough’s..
EVERYONE WANTS A DEAL
I went out on the road with a couple of sales athletes this week.
Met several people in retail who told me their war stories… fascinating..
As we spoke of their sales mindsets and sales strategies one of the patterns that became clear when we were talking of closing strategies was..
EVERYONE WANTS A DEAL..
Everyone, when buying, wants to feel like they are getting a good deal.
Everyone wants to feel they are getting something special.
In fact, just last Friday afternoon I was with my darling wife Catherine buying her a bike for her birthday.
She was motivated to get a new bike after our recent visit to Copenhagen (where 37% or more of people commute to school, Uni, work etc on bikes and 55% use bikes to go to restaurants, cinemas, getting around the City. They consider themselves ‘The Bicycle Capital of the World’. They have all sorts of systems in place to support people riding bikes including ‘bike counters’ and public ‘how many people are riding bikes today’ scoreboards. It really is a fantastic place.. Check out this video I found if you’re interested clicking here.) )
Matt, the bicycle sales guy, did many of the things we teach.. (I must say, if he had done some of our training he could have done even better in less time and made a bigger sale… but he did a pretty good job..)
1. He showed us the Rolls Royce of bikes first… (which then made it much harder to move my darling wife down to something a little more realistic..even though it was still a great bike..)
2. He talked value and quality and ‘smoothness of ride…’ and ‘how comfortable and easy it is to cruise on this bike…’
3. As we got to something closer to what I had budgeted on, he also talked ‘great value…it is already marked down’ ‘we sell these at very low margin…’ ‘we don’t make much at all on these..they really are great bikes…’
4. When I offered even lower than his marked down retail price, he didn’t budge. He got out the calculator, did the numbers and gave me reasons why that really was his best price… He paused. He screwed up his face.. He contorted.. and then he offered me a free bike lock as part of the deal. (We had already bought the Gel Seat cover so my darling would be more comfortable and the ‘Bike Paths of Perth’ book…) But at least I had a DEAL… I got something extra… I felt I had a win..
Plus… my wife is happy with her new bike…
She now has the best bike in the family…
Lesson: re-read what I have just written above… 50-80% of people in retail DO NOT DO WHAT I HAVE WRITTEN ABOVE.. and if you do… you will increase conversion rates and sales 20% or more..
Make sure you have scripted in and systematized your sales process… especially the value add and closing sequences..
If you’re in Perth, November 1st is our next New Sales Science Seminar where we will cover off on these strategies and more.. register now FREE by clicking here.
PROTECT THE MARGIN
With one of our furniture clients on Friday and they have a new sales person.
He had come from a competitor where they constantly discounted their products.
He recently said to one of the owners… ‘I have this client who wants $2500 of furniture.. he only wants to pay $2000 for it… there is $200 margin in the deal.. Can I sell it to him?’
The owner said ‘No.. that is too thin a margin… we need at least 30% margin to make the deal worthwhile..’
The sales person says ‘You’re getting $200 profit on the deal… it’s better than nothing.. and we don’t want the customer going to the competition..’
DO YOU SEE ANYTHING WRONG WITH THIS THINKING??
This is where sales people need to understand the difference between Gross Profit and Net Profit..
Tell me if I am wrong but on my calculations $200 Gross Profit on $2500 is less than 10% and my client has calculated, with his fixed and variable overheads, he needs at least 30% GP to cover costs and make just a little bit of profit..plus…what are you training the customer to do if you do the deal with them?
To screw you down on margin every time..
He not going to pay more if he buys low from you the first time..
Let him go to the competitor and let them lose money on the deal. (And acquire for themselves a price shopping, low quality customer)
You want customers who are happy to pay premium for premium quality and premium service.
If your sales people don’t protect your margin, you could be going out of business backwards even though you’re making sales.
Don’t just reward and incentivize revenue, reward and incentivize CONTRIBUTION TO PROFIT… reward and incentivize MARGIN PROTECTION x REVENUE..
Sales people need good financial literacy… or it costs big time..
JUST AS A THING REACHES ITS PEAK
Years ago someone gave me a quote from the ancient Jewish text and teachings of The Kabbala.
The quote read ‘just as a thing reaches its peak it begins its decline….’
Watching Geelong on Friday night was to witness a once great team moving onto the other side, the down side, of the Sigmoid Curve..
The difference in age, speed, hunger, team synergy all added up to decline…
Over the years we’ve seen it with Brisbane Lions, Adelaide, the West Coast Eagles, Carlton..etc..etc..
‘Just as a thing reaches its peak.. it begins its decline….’
Coach Bomber Thompson now has a rebuilding phase to go through.
Collingwood had studied and modeled themselves on Geelong.. and now, as in so many phases of life and throughout history, the student has now become the Master.
Look out St Kilda next week..
See you next week..
Have a great selling week..
The economy needs you..