Block the Knockouts from All Your Competition
The rules for doing business have shifted. In times of slow growth or shrinking markets─and even new and expanding ones─companies must find ways to take market share from competitors to succeed.
This intensified competition puts the need for effective selling in a brighter spotlight. So having a solid plan to manage competitive selling situations is more crucial than ever.
In nearly all industries, products and services have become more complex, more varied, and more prolific. By the time the prospect makes a buying decision, something better has already come along.
Change isn’t just in the air; it is the air.
Challenging Prospect Opportunities
You can’t tout products anymore; it’s no longer enough. Sales professionals must thoroughly understand their competitors, prospects, and their own companies. They must do their research if they hope to acquire new customers, those their competition let get away.
In the time I spend coaching and listening to salespeople, I keep asking myself: Why do so many salespeople have difficulty opening new prospect opportunities?
First problem: Someone already has the account. As you enter the new sales opportunity with your value proposition and differentiation, the incumbent provider, who already has the account, waits to ambush you and protect his relationship with your prospect.
The incumbent’s goal is to knock you out by interceding to get a “last look.” How many times have you done all the work to improve a prospect’s situation, only for him to stay with the incumbent?
The incumbent matches your price or makes the improvements you suggested. No prospect wants to rip up the sidewalk and move a relationship if they don’t have to.
The second problem: Most salespeople do not differentiate themselves enough to be viewed by their prospect as better than the competition.
As Mark Hunter says in his book High Profit Selling: “There’s a reason why customers don’t see value in salespeople, because to be quite blunt, most salespeople don’t bring value. To many customers, there’s zero difference between salespeople and, therefore it doesn’t matter who they deal with.”
If you sell in a commodity-oriented business or industry with a lot of competition, you must stand out from the crowd. You must stand out to give the prospect a reason to want to buy from you and, more importantly, a reason why they should refer you to others.
Types of Competitive Selling Situations
Of course, when selling in a competitive situation, you must convince the prospect that your products or services can satisfy his needs more effectively than those of your competitors.
Often, you may face a combination of these situations with a single prospect. For example, the prospect is:
looking at your product(s)/service(s) and at one or more of your competitor’s
using a competitor’s product(s)/service(s), and you’re trying to displace the competitor
facing an issue he knows he must fix; currently has no solution, and has asked some companies to bring him a solution.
- using your product(s)/service(s), and a competitor tries to displace you
Too Many No Decisions
Many of these competitive selling situations end up in no decisions. In fact, an amazing 58 percent of the sales pipeline ends up in no decision or stalled deals because salespeople have not presented value effectively. The inability to communicate value rests largely on misalignment with buyer stages.
That’s why you must understand why the prospect is considering a change, what they are seeking to fix, accomplish or avoid, and then be able to leverage your unique differences to those needs.
Establish Prospect Buying Vision
To close complex sales, one must help the prospect establish his buying vision or concept. In a recent study by Forrester Research, 74 percent of executives indicated they give their business to the company that establishes the buying vision.
In other words, they choose to work with the company that helps them see clearly the need to change and clarifies their needs and solution requirements. It’s a good thing for salespeople then that only 26 percent of executives rely on a competitive comparison or true “bake off” to choose their winners.
Making Your Solution Ideal
This first aspect is quite basic: Know how your offering is different from the competition. Which means you must do your homework, research your industry, and figure out why a prospect might find your product more attractive than a similar offering from your competitor.
If you don’t do your homework, you might as well forget it because you’re probably going to lose the sale. However, if you do know how to position your product, you can address the second aspect: Guiding your conversation with the prospect such that the superiority of your offering becomes clear in his mind.
The third aspect: You need to understand the prospect’s business needs and what he considers a personal win. Clear understanding only happens when you ask the right questions. Then, as the prospect becomes more aware of his needs through your good questioning, he self-discovers.
You also must understand the intensity of the prospect’s pain and its role in determining his motivation to change. What is he trying to fix, accomplish or avoid, and what happens if he does nothing? At this stage, you need to develop the prospect’s concept or vision for a solution.
Too many salespeople jump the gun and try to connect their solution before they have the concept clear. It’s more than just connecting your product or service to the prospect’s problem. It’s about the why.
But don’t get into why your solution is so great; it’s not even about your product yet. It’s about your concern for the prospect’s business and how it’s in danger if the company stays where it is, facing the challenges, threats, changes, problems and other issues. It’s about what they are trying to fix, accomplish or avoid.
And finally, put your prospect’s hat on and list out the pros and cons (be completely objective) of why he would select the competition over you. His pros become your warning flags, and the cons become your strengths.
As an example, if he can integrate data using your system, and his current system or the competitors can’t, then that’s a strength you need to leverage.
If moving from the incumbent disrupts his business, that’s a red flag you need to overcome. How can you convince your prospect that the transition will run smoothly? How can you point out the advantage of integrating data?
Indirect Competitor Knockouts
Many times we focus so much on the direct competition that we overlook the others. You need to identify all the likely alternatives to the solutions you’re offering. The rival firm targeting this business is only one alternative. Your prospect could also choose to provide an internal solution, use budgeted dollars or resources elsewhere, or do nothing.
The exercise I mention above should be used here, too, to identify red flags and strengths from the buyer’s standpoint. To help you clarify these other options, ask your prospect:
Do you have other more pressing business issues to which needed resources or budget might be diverted?
Do you have a tendency to try and solve projects like yours with internal resources? Do you have internal options available for the issue you’re trying to solve?
What could make the money for your solution go away?
Is there any benefit for you to do nothing?
- Is that a safe proposition? What is the cost or danger of not fixing the problem?
Remember that for any one of these questions, you might have one or more answers.
There could be two or more competitors competing for this business; there could be decision makers who see doing nothing as an advantage; there could be internal resources who feel they will lose control if the solution is outsourced; the prospect could have a dozen alternative uses for the money.
Handle on all the competition and identify the pros and cons of each, as part of your effort to sell more effectively in this fiercely competitive world.
Are you ready to block your next competitive knockout?
See you on upside,
For more information on how to simplify the complex sale, go to www.pleinairestrategies.com Or call William L. MacDonald in San Diego at PleinAire Strategies LLC at 760.340.4277 or 213.598.4700