By Tom Reilly
“A moment’s insight is sometimes worth a life’s experience.” — Oliver Wendell Holmes
What is on the minds of distributor salespeople? In a recent University of Industrial Distribution (UID) presentation I had the opportunity to survey attendees (salespeople and their managers) to determine t heir greatest challenges. Their responses give us insight into the hurdles they face in their territories.
We presented the attendees with a list of 12 common challenges that salespeople face and asked them to select the six that affect them the most. Using a frequency distribution, we came up with a rank-ordered list of their greatest challenges. Each of these challenges represents perceived barriers to achieving their goals. By addressing the three that form the core of this article, sales managers can help salespeople leap over these hurdles and race to the finish line.
Challenge One: Price Shoppers
Ninety-three percent of the respondents told us that dealing successfully with price shoppers or customers that commoditize the seller’s product was a challenge. One reason salespeople find this difficult is because their companies lack a coherent and consistent pricing strategy. These salespeople hear mixed messages from management on how to price their goods and services. Some are even told to never pass up an opportunity because of price: “Get the order and we’ll figure out a way to make money on this.” Managers can simplify the salesperson’s life by practicing a pricing discipline that gives the salespeople an anchor to hold on to when things get turbulent with customers.
Ironically, salespeople who work for companies that refuse to discount and do not burden salespeople with pricing authority bring fewer price objections to seminars. A number of them have told me that it is liberating to talk to customers who know this supplier will not buy the business with a cheap price. One young sales rep said to me, “Since I know we will not compete on price, I spend all of my time trying to figure out a way to sell our value.”
Challenge Two: Communicating Value
Eighty-five percent of the respondents told us that communicating their value and differentiating their solution were challenges. This is amazingly close to another study that found that 82 percent of salespeople fail to differentiate themselves from the competition. More than half of the people I train cannot answer this simple question: What are your definable and defendable differences? Many salespeople will bring price objections to our seminars that really are not price objections.
The buyer says, “Why should I pay a dime more for your product when I don’t see a penny’s worth of difference?” Salespeople may process this as a price objection when it is really a failuretodifferentiate objection. Price is not the issue; a lack of differentiation is the real issue. Managers can help salespeople with this perceived barrier by doing two things. First, conduct an internal audit that identifies visible and hidden value. Make a list and equip the sales team with copies that they can use on sales calls. Second, explore the company’s uniqueness. Distributors fail miserably in this area. When I ask them how they are different, many respond with the perfunctory superlatives: great service, awesome people or best quality. All may be true, but as such, they lack the energy of these compelling differences:
• “We were the first in the industry to …”
• “We are the only ones that …”
• “Our customers tell us we’re special because of …”
Even managers struggle their way through the answer to the uniqueness question. They can fix this by having a meaningful conversation with their sales team about their definable and defendable differences. This presumes that their companies stand out in some fashion.
Challenge Three: Buyer Inertia
Sixty-two percent of the salespeople told us that buyers who do not want to change are an obstacle for them. Buyer inertia is nothing new. It is a common phenomenon that humans resist change at times. This is especially the case when no one has given the person a compelling reason to change (the second challenge discussed). Buyers refuse to change for several reasons.
First, the buyer may be legitimately thrilled with what he or she is doing and feels no compunction denying the salesperson the business. Second, the salesperson may not have offered a good enough reason to change. Buyers change for pain or gain. If there is no pain and no perceived gain, things will remain status quo. Sometimes, when the gain is overwhelming, even in the absence of pain, buyers will change. Third, the buyer ignores the pain. I believe this is the most common expression of inertia – unknown or unarticulated pain. The buyer simply does not realize how miserable he is until the sales person helps the buyer to discover his pain. The salesperson uses simple diagnostic tools like questions to uncover the pain. When the pain reaches a high enough intensity, buyers change.
Our research has found that two thirds of buyers’ objections can be traced to insufficient fact-finding by salespeople. They are not asking enough quality questions. Our research has found that two thirds of buyers’ objections can be traced to insufficient fact-finding by salespeople. They are not asking enough quality questions. Managers can help by building in practice probing sessions to their weekly sales meetings. This hands-on training helps salespeople become better interviewers and diagnosticians.
These challenges are common across distributors, manufacturing and the service industries. Commodity-minded buyers exist in every segment of society. No one has a monopoly on price resistance. Communicating value and standing out from the crowd has long been the aspiration of marketers. In fact, 75 percent of sales and marketing executives believe that getting the value proposition right and communicating correctly is the number one objective in customer messaging. Buyers who are satisfied with the status quo have confounded generations of salespeople. It’s not so much that buyers resist change as much as they resist being changed. Change that emanates from within is a powerful dynamic force.
Salespeople need not feel helpless. Clarity of pricing practices, knowledge of one’s value and tapping into the dynamic forces of change equip salespeople to tackle these challenges successfully.
Tom Reilly is a professional speaker and author of Value-Added Selling. You may contact him through his website, www.TomReillyTraining.com.