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NZ’S E-MAG FOR SALES LEADERS | WWW.NZSALESMANAGER.CO.NZ SEPTEMBER | ISSUE 86 Page 6 Tips for Communicating Price Increases 7
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NZ’S E-MAG FOR SALES LEADERS | WWW.NZSALESMANAGER.CO.NZ
SEPTEMBER | ISSUE 86
Page 6
Tips for Communicating Price Increases7
02 | www.nzsalesmanager.co.nz
From the EditorThe run in to the election should be all
about politicians selling themselves, and giving clear information
about the value they will provide to their prospects, the voting public. It is a great opportunity to differentiate themselves from their competition, by how they sell, as well as what they sell.
All this is done under the eye of the media who will make the most of any slip up. After a few weeks of ‘dirty politics’, which has given the media plenty to feast on, we see on our screens just how many politicians are selling by bagging their competition.
Politicians consistently rate as the least trusted people in the public eye for good reason, yet it seems to me that while they are putting so much effort into supposedly keeping
ABOUTShort and sharp, New Zealand Sales Manager is a free e-magazine delivering thought provoking and enlightening articles, and industry news and information to forward-thinking sales managers, business owners and sales professionals.
each other honest, they fail to realise that when their prospects are seeing them discrediting the competition on a daily basis, it doesn’t make them more trustworthy. When all the players are using attack and defence, they all look the same.
There are big lessons for sales professionals during any election time. Stand out from your competition by how you sell.
PNTwitter
CONTACT/SUBSCRIBE&SHARE
W www.nzsalesmanager.co.nz
EDITOR Paul Newsom
ART DIRECTOR Jodi Olsson
GROUP EDITOR Nick Harley
ADDRESS NZ Sales Manager, C/- Espire Media, PO Box 99758, Newmarket, Auckland 1151, NZ
ISSN 2230-4762
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ADVERTISING ENQUIRIES Phone Richard on 09 551 0607 or email [email protected]
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Talk to one of our Business Consultants today and we’ll help drive your business forward.Call 0800 022 249 or visit 2degreesmobile.co.nz/businessM
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04 | www.nzsalesmanager.co.nz
SEPTEMBERcontents
THIS MONTH'S MUST READ...........................................................................................6SEVEN TIPS FOR COMMUNICATING PRICE INCREASES
WHY YOU DON’T NEED MOTIVATION TO WIN BUSINESS...............................12
QUESTION OF THE MONTH..........................................................................................16HOW CAN SALES PEOPLE CREATE REAL VALUE THAT COMPETITORS CAN’T COPY?
TWO MINUTE TOP-UP....................................................................................................18SEVEN MODERN DAY WAYS TO LEAVE A LASTING IMPRESSION
QUICK FIX........................................................................................................................20It’s not what you sell, it’s how you sell
BOOK REVIEW...............................................................................................................21 When Buyers Say No by Tom Hopkins and Ben Katt
EVENTS CALENDAR......................................................................................................22
03 | www.nzsalesmanager.co.nz
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Turn your smartphone into a payment device.
Get yours today. Only at BNZ.Visit bnz.co.nz/PayClip
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06 | www.nzsalesmanager.co.nz
MUSTREAD
7 Tips for Communicating Price Increases
Words by Mark Hunter
Talking about it never makes for an easy conversation. When discussing a price increase in a business-to-business environment, it is important to remember
that our customers have probably had to have the same discussion with their own customers.
A company exists only as long as it earns a profit, and it can only do that if it delivers a quality product or service at the right price. This means that the key to any conversation about raising the price is to emphasize that such an increase will ensure product quality.
As you begin to prepare your strategy for communicating a price increase, ask yourself the following questions:
1 DOES THE CUSTOMER TAKE YOUR PRODUCT/SERVICE AND ADD A STANDARD PERCENTAGE
INCREASE IN PRICE WHEN SELLING TO THEIR CUSTOMERS? If this is the case, you can point out that your customer will make more money by taking a standard percentage of a higher amount.
2 WHAT PERCENTAGE OF THE CUSTOMER’S BUSINESS IS YOUR PRODUCT/SERVICE? If the
percentage is small, tell them that the amount of increase is only a small percentage of their total business. If the percentage is great, then you can emphasize that the price increase is necessary to maintain the level of product quality necessary for them to serve their customers.
3 HAS THE CUSTOMER FACED ANY OTHER PRICE INCREASES FROM OTHER VENDORS? If so, try to
identify what some of the percentages of the other increases have been. If yours falls into the low end, then you can point out how your increase is comparatively smaller than that of many others. If your increase is at the high end, you can either explain how yours is the only one you expect to take, or that you wouldn’t be surprised to see others coming back to take another round of price increases.
www.nzsalesmanager.co.nz | 07
4 How does the customer view you and the
products/services you sell? If you have a quality reputation and record, then you can emphasize that the increase has been carefully thought through and it is only being taken to ensure continued quality.
If you have a spotty record with the customer, then you should stress how the price increase will allow you to begin addressing some of the issues in question by allowing you to improve the overall quality of service they have been receiving. Naturally, it is important to make sure all comments are backed with a commitment to follow -through.
08 | www.nzsalesmanager.co.nz
5 WILL THE CUSTOMER RAISE AN ISSUE WITH THE PRICE INCREASE? Be prepared to show documentation
of how your costs have escalated and how other companies are experiencing the same increases (An example is the increasing cost of oil, which has forced any company that uses petroleum in the manufacturing or transportation of goods to most likely increase prices).
When having this discussion, be sure to show empathy for the customer, but remain firm in what you’re saying. If the customer senses any hesitation on your part, they will likely try to exploit it in the form of a price concession from you. Also, be prepared to share steps that your company has taken in an attempt to avoid a price increase.
This can include ways you’ve already cut costs, or how the price increase is the only way to maintain the quality and service the customer expects. A final point to emphasisze is the time lag between this price increase and the previous increase. Having information available concerning the rate of inflation during that specific time period may also help diffuse the issue.
6 WHY DOES THE CUSTOMER BUY
FROM YOU ANYWAY? Knowing this will allow you to reinforce these points when talking about the price increase. You should also have ready at least two key needs of the customer that your product or service satisfies. Be sure all of your strategic information about the customer is up-to-date before a price increase is announced.
7HOW MUCH BUSINESS IS AT RISK FROM
THE CUSTOMER? We can sometimes get carried away, thinking that if we raise prices, we’ll lose the customer, even though this is rarely the case. Think through what steps the customer would have to take to move to another vendor. Many times the work involved in moving is not worth the effort, and thus the business is less at risk than thought.
We can sometimes get carried away, thinking that if we raise prices, we’ll lose the customer, even
though this is rarely the case. Think through what steps the customer would have to take to move to another vendor. Many times the work involved
in moving is not worth the effort, and thus the business is less at risk than you thought.
The following tips are the best practices to employ when executing a price increase:
• GIVE THE CUSTOMER LEAD-TIME Provide the customer with enough notice to allow them to make adjustments in their information systems and to exercise at least one more order at the existing price.
• AVOID SHOWING FAVOURITES Pricing integrity is always essential, but especially so during a price change. Do not treat particular customers more favourably than others in pricing during an increase. Different pricing levels are fine, as long as they can be logically defended, so that a customer who is not receiving the price break can understand and accept the price change.
• DO NOT ALLOW YOUR CUSTOMER TO FIND OUT ABOUT A PRICE INCREASE FROM YOUR INVOICE Any changes in pricing must come from the account executive or a person of high position within the company. Information regarding a price change should only appear on an invoice after every person involved has been personally notified. (Sufficient time should occur in the price increase timeline to allow at least one invoice to contain a note of the pending increase in price).
Provide the customer with enough notice to allow
them to make adjustments in their information
systems and to exercise at least one more order at
the existing price.
010 | www.nzsalesmanager.co.nz
Mark Hunter, The Sales Hunter, is a consultative selling expert committed to helping individuals and companies identify better prospects, close more sales, and profitably build more long-term customer relationships
www.thesaleshunter.com
• MAKE SURE EACH CUSTOMER SERVICE REPRESENTATIVE AND ANYONE ELSE WHO COMES IN CONTACT WITH THE CUSTOMER IS FULLY AWARE OF WHEN THE PRICE INCREASE IS GOING TO BE COMMUNICATED. One of the most significant possibilities for confusion is when the customer hears conflicting information from different departments. Everyone in customer service needs to be fully aware of the price increase, the reasoning behind it, and the logistics for implementation. They should also be provided with a FAQ guide to ensure that when customers do ask them about elements of the pricing increase, they are able to share accurate information.
• BELIEVE IN THE PRICE INCREASE. In order to be paid what you are worth, you must charge what you are worth. Although this is not something that can be explicitly communicated to the customer, this general sense is what sets apart the best- practice companies and high-performing sales professionals.
• INSTILL AN OPEN-PHONE/OPEN-DOOR POLICY. Any time a price increase takes place, it is important for all senior executives to be willing to answer a phone call from a customer or to make phone calls to key customers. For successful consultative selling, nothing sends a stronger signal to a sales organiszation than seeing their senior executives on the front-line when dealing with a price increase. Before and after the price increase, monitor the sales patterns of your individual customers. It is important to quickly catch any changes that occur as a result of the price increase.
During the 1970s and 1980s, price increases were common and expected. In the past several years, however, we’ve all grown used to lower inflation and the overwhelming impact of the Wal-Mart’s philosophy on pricing [Editor: NZ example would be The Warehouse]. philosophy on pricing.
Today, price increases are again growing more common and acceptable as long as they are well thought through and not seen as a way to merely increase profits. Because they are an inevitable part of business today, we can’t let ourselves avoid dealing with price increases. Instead, we should seek to use them strategically to increase our selling potential. ●
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Why You Don’t Need Motivation to Win Business
Recently I was privileged to attend a complete coaching
philosophy session led by the Head Coach of A-League team, Melbourne Victory and his three key assistants.
There were less than a hundred of us eagerly eating cold party pies, waiting for pearls of wisdom on how their magic structures or formations could help our junior footballers suddenly become heroes and in turn claim bragging rights at the pub.
But there were no great insights into the game plans or strategies, rather, we got something far more powerful, that applies just as strongly to you in winning new business. Here are the three key insights from an elite coaching group and why this will lead to consistent wins in sales:
Words by Elliot Epstein
www.nzsalesmanager.co.nz | 013
Oh, and don’t waste your budget on listening to speakers who have climbed Mt Everest on one leg after contracting the Ebola virus at base camp. You’ll be filled with admiration, but it will last as long as fairy floss and your sales figures next year won’t have increased.
Every Training Session Is At Full IntensityA source of pride are my LinkedIn recommendations that talk about how challenging the sales/presentation/negotiation training was, yet how excited they are about the results they achieved afterwards.
Melbourne Victory train at full intensity week after week, drill after drill. Everyone is committed to match day intensity because they are consummate professionals who want to win.
When I mention the words ‘Role Play’ or ‘Presentation Rehearsal’, some people look at me as if I’ve just announced that I’ll be attaching electrodes to their testicles and delighting in ramping up the voltage.
That only happens when there’s access to off-peak electricity rates, and is highly conditional on whether or not I had an argument with my wife that morning.
The real professionals ask for more air time, more critique, more feedback. Instead of saying “I’m much better than this in front of a client’, they say “Make me better so I can win more business at C Level, win more deals and make more money”.
Can you imagine a footballer saying “I pass much better in a match than I do at training, so I’ll grab a coffee and sit this one out if you don’t mind, coach”.
Motivation Is A Waste Of TimeHead Coach, Kevin Muscat was characteristically blunt when he said there was too much work to do to waste time trying to motivate professionals. If they weren’t self-motivated then they wouldn’t be at the club for very long.
When questioned if he would spend time motivating a player who was having a bad run, he said: “Zero...we would simply get to work on coaching skill or technique”.
Many sales managers have asked me how to motivate a salesperson with “He’s a good guy; I just can’t get him motivated to do X”, my standard reply is “I’m not that good”.
If he/she wants to succeed, I’ll give them a range of skills, technique and ideas to win business, but given he/she gets a six figure salary to turn up, the minimum requirement is desire, adaptability and attitude.
014 | www.nzsalesmanager.co.nz
Elliot Epstein is a sought after keynote speaker and corporate trainer who has coached and trained over 4,000 people, including CEOs, senior management and successful sales teams throughout Australasia.
www.salientcommunication.com.au
The Strategy Doesn’t Change MuchWhilst the team structure is tweaked slightly week to week, depending on the opposition they’re playing, the core strategy, positional play and tactics don’t change much.
The reason for this is that the game strategy is set by the coaches in the pre-season, well before a match is played.
Everyone understands the ‘way we go about about winning’, so if a player is injured or gets sold for megabucks mid-season, someone else can simply slot in, adhere to the well drilled strategy and play their role.
There are a lot of sales people and managers who change their strategy more often than they dry-clean their favourite suit.
End of quarter pressures, product mix issues, bonus incentives and perceptions of different markets often lead people to change tactics dramatically half way through a ‘sales season’.
Existing sales people get thrown out of whack, clients get confused, new sales people are uncertain, and inconsistency in wins creeps in because the whole team (including pre-sales, marketing, service and support) is playing differently every week.
Some people like to call this flexibility. I call it ‘ad-hoc adventures into the unknown’.Elite sport is a multi-million dollar operation run by elite coaching methods. Elite Selling should be no different.●
Whilst the team structure is tweaked slightly week to week, depending on the opposition they’re playing, the core strategy, positional play and tactics don’t change much. The reason for this is that the game strategy is set by the coaches in the pre-season, well before a match is played.
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016 | www.nzsalesmanager.co.nz
QUESTIONOFTHEMONTH
Words by Ross Wilson
According to Tom Roth, Chief Operating Officer of Wilson Learning Worldwide: To avoid the pitfalls of competing on price, salespeople are often told they
need to 'sell the value'.
Another strategy is to 'value-add', by offering the customer extra services or product features without charge. While these strategies can be effective short-term, neither of these approaches produces a sustainable advantage.
How can sales people create real value that competitors can’t copy?
However, salespeople rely on these strategies, ineffective though they often are, because they find it difficult to achieve genuine differentiation based on something the customer values and is hard for the competition to replicate.
www.nzsalesmanager.co.nz | 017
But suppose a salesperson were able to create a highly differentiated offering that provides real value competitors can’t copy - because it is unique to the customer? The secret lies in going beyond features and services that are easily commoditised, and developing what (Harvard Business School Professor), Ted Levitt called 'the potential offering'.
Salespeople can achieve this kind of differentiation by looking beyond their product to all aspects of the customer’s experience across the whole process of buying and using a product or service.
For example, a salesperson for a company that sells paper
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products developed an innovative way for his company’s clients to help their customers recycle used office paper, helping increase sales and customer loyalty.
Another company provided a way for their customers to dispose of empty containers for one of their products that came in the form of an aerosol spray.●
The secret lies in going beyond features and services that are easily commoditised, and developing what (Harvard Business School Professor), Ted Levitt called 'the potential offering'.
Ross Wilson helps organisations improve business and human performance. Read more in the full report here.
018 | www.nzsalesmanager.co.nz
TWOMINUTETOPUP
Seven Modern Day Ways To Leave A Lasting Impression
Words by Linda Coles
1. Pay someone a compliment If there is a genuine reason to pay someone a compliment, make their day and tell them. The person wearing a great shirt or a nice perfume will always appreciate a positive compliment, and that compliment will stay with them all day. I wear the best shoes I can afford and they get noticed, very often making the topic of conversation.
2. Say thanks often Show your appreciation by saying “thanks” when someone holds the door open for you , or goes out of their way to do something. When did you last thank your partner for being awesome or your staff for doing a great job? Appreciation is one of the main drivers for someone staying committed in a relationship or job: don’t forget to tell them.
3. Give generously If you are not the type to get stuck in when manual labour is needed, how else can you give generously? A fellow Rotarian, who didn’t have the time for the physical work, gave his expertise generously instead, allowing the club and other charities to benefit from his experience and knowledge.
Dale Carnegie wrote a fantastic book back in 1936 that really spelled
out How to Win Friends and Influence People, and in my view it was so successful, and continues to be successful, because it contains such a lot of common sense about treating others how we ourselves like to be treated.
Unfortunately, we sometimes forget our common sense due to work and other pressures;, and times have changed a little too, so I have put together a quick list with a few examples of both ‘old’ and modern day areas to focus on to leave a lasting impression and be remembered for the right reasons.
www.nzsalesmanager.co.nz | 019
4. Do what you say you will Don’t let others think badly of you by not doing what you said you will, even the smallest of things. Someone may well be relying on you.
5. Smile I am a big believer in this. The chap that held the door open for me with a beaming smile made me feel like a princess. How can you pass on such great feelings to others to make their day?
6. Use their name What was the name of the barista that made your coffee this morning? Next time you order, thank them as usual and follow up with their name, it will be noticed. Using their name really is Dale 101, “The single sweetest sound in any language is a person’s name”.
7. Follow up The drain- layer that came to give me a quote didn’t follow up until two months after he visited. Needless to say, someone else did the job and he lost out. Do you follow up 100 per cent of the time in a timely manner, before your competitor gets in? You will stand out just by following up every time, because so few people do it.
Build exciting relationships, online and off.●
www.bluebanana.co.nz Linda Coles is a conference speaker and author on building relationships, and New Zealand’s only LinkedIn Influencer.
Do what you say you will. Don’t let others think badly of you by not doing what you said you will, even the smallest of things. Someone may well be relying on you.
020 | www.nzsalesmanager.co.nz
QUICKFIX
Don’t Bag the CompetitionWhen in pursuit of
a sale, don’t bag the competition.
Remember that you have competitors, your prospect has alternatives.
By putting down the competition you run the risk of being seen as unprofessional, and perhaps a desperate salesperson
making a vain attempt to make yourself look good. Politicians do it all the time – does it make you trust them?
You will soon break trust if your prospect has previous good experience with your competitor too. All this could result in you being taken off the prospects list of alternatives.
You should however be asking what alternatives the prospect is considering so that you can position the value of your offer or solution. Differentiate from your competition by focusing on the value you can provide to meet the prospect’s decision criteria and there will be no need to sling mud at your competition.●
www.nzsalesmanager.co.nz | 021
RESOURCECORNER
This is a complete and practical guide thatwhich highlights the authors’ new strategic
approaches to selling when the buyer initially declines or is resistant on a sales opportunity.
Hopkins and Katt explain that most sales reps take a traditional linear approach to selling, but that the trick in closing is in taking a more creative and circular approach. That’s the key.
It all starts with how the buyer initially says no. Too many sales reps don’t pay close attention as to how that’s presented. Hopkins and Katt point out that ‘no’ may suggest all sorts of other options – avenues that can eventually lead to the buyer actually saying yes.
The authors introduce a novel concept called the Circle of Persuasion, which offers sales reps a new approach in this potentially tricky process.
Along the way, When Buyers Say No details prescriptive steps and even sample dialogues that will instruct and guide
When Buyers Say No
sales professionals on how to best cultivate buyer-seller relationships. There’s particular emphasis on how to establish the kind of rapport that ultimately leads to a successful close.●
www.mightyape.co.nz $36.99 by Tom Hopkins and Ben Katt
Essential strategies for keeping a sale moving forward
022 | www.nzsalesmanager.co.nz
EVENTSCALENDAR
DATE NAME PLACE COMPANY
15-17th September Sales Performer Auckland David Forman
15th September Protect and grow your margins Auckland David Forman
16th September Sales Basics Auckland Geewiz
16th September Cold calling and prospecting Auckland Top Achievers
17th September Advanced Serious Selling Auckland Geewiz
24th-25th September
Turning Leadership Inside-Out for Sales Managers
Auckland Gilly Chater
25th September Sales Management Auckland Top Achievers
25-26th September Persuasive selling boot camp Auckland The Marketing Company
13th October Prospecting Auckland David Forman
14th October Sales Training Christchurch Top Achievers Sales Training
14th -15th October Sales Manager Boot Camp Auckland The Marketing Company
20th October Advanced Sales Development Auckland David Forman
21st October Sales Basics Auckland Geewiz
22nd October Sales Management Auckland Geewiz
23rd October Overcoming Objections Auckland Top Achievers Sales Training
28th October Sales Management Auckland Top Achievers Sales Training
29th October Sales Leadership Luncheon Auckland Salesstar.com
www.nzsalesmanager.co.nz | 023
THECLOSE
“Forget about the business outlook; be on the outlook
for business”Paul J. Meyer
