One of the challenges in working with consumer electronics is the price shopper! They have recognised what you sell is a commodity and so they just want you to give them a price. They have been on the internet and checked out the prices, they have been down the road and knocked on your competitors door and know it all! They just want a price.
Does this sound familiar? I am sure it does.
The question is how do you respond to this?
Most retailers just give the ship away. They immediately just “drop their pants” and go down to the most common level which is price. It is easy to compete on price. In fact why do you even need a sales person if that is what you are going to do! You might as well just put a bank of machines in the store where the customer enters a price and it automatically responds with a price that is lower!
Yes, I am being smart, but the reality is if your total focus is on price you are on a natural road to disaster as margins are squeezed to a point that even with manufacturer rebates gone, so are you!
So one thing is critical is that you train your sales people to handle price shoppers so that they stop and buy with you! But not only do they buy the product that they came in for but you use the opportunity to sell another at the same time also.
So how do you do that?
By asking questions!
In my eCourse “The Secrets of Selling Warranty” I teach a couple of techniques for deflecting price questions. One is by asking “Is price your only concern?”
Sadly, most sales people don’t ask this! They think it is too contrived. In fact what am I getting them to do? I am giving them a simple way or system if you like for getting them to understand what is important to the customer!
Customers only buy for their reasons! Not yours!
You can give them all the features and benefits under the sun! But if you are not talking in their language and thought patterns they won’t buy.
So you must train your staff to have a questioning system in place that gets to know your customer. What is important to them? What is their situation? How, why, where or what are the using the product for? Don’t assume you know. Ask lots of questions.
Have they shopped with you before?
Are they responding to a promotion?
Have they been looking for long?
Where have they been looking?
Have they used the product before?
What happened to the last one?
What didn’t you like about your last one?
What did you like about it?
When would you like to take delivery of it? (Timing can be very important)
Would you be able to install it?
How long do you want to keep it? (Good warranty intro)
What other brands have you been looking at?
The questions are limitless! The value and information they bring you the sales person are invaluable.
By asking questions you will get to know what the customers concerns are. What are their fears, frustrations, wants and needs? You will also get to know how valuable this customer is to you now and in the future.
Armed with all this information you can then position/ package the sale of your product or service so that price is not the main decision criteria.
Focus on delivering value in the customer’s terms and you will win every time!
Tuesday, February 26, 2008
Know Your Numbers!
For Commission Based Sales People Working in Retail
I get absolutely amazed at the number of commission sales people working in retail that do not simply know their key sales figures. Then they wonder why they never make commission or never grow their income figures.
Why do they fail? Basically because they drift! They never go that extra mile! They never focus on the end result! They never think about how they can help their customer by finding add on solutions and thus growing their income.
So how do you change that?
Firstly, the sales person must believe they are working for them selves. They need to change their hand out mentality. Instead they need to take total ownership, accountability and responsibility for their role as a professional sales person. This means they must plan for their success. Be totally responsible for their results and be responsible for their own personal development. They need to stop being excuse merchants but to take total responsibility for their outcomes. After all they create their own destiny and have the power to change their income.
Secondly, they must plan for their success. This means setting goals. Many hate the “G” word. If you don’t know where you are going how will you know when you have got there. One of the most powerful things that you can do to build your own self esteem is to set goals for yourself as you can then measure your success. Not only does goal achievement make you feel good about yourself but achievement will flow in to making you feel more positive about your job and how you treat your customers. This will flow into making you more successful. As they say “Success breeds success”.
Setting goals for yourself, and I am not talking about boss imposed goals provides you with a great way of accessing your own performance. If you are under performing then it is like having a car that is misfiring. Do you need a tune up! In sales if you don’t know your numbers daily then how do you that your sales machine is misfiring. Once you know your numbers you can then take remedial action or seek help before it is too late. Where are the gaps in your performance? Are you asking enough customers for the sale? Are you having difficulty closing sales, handling objections, have enough product knowledge or having difficulty in building rapore with your customers?
What ever the problem unless you are measuring your performance daily you are setting yourself up for failure and the disappointment at the end of the week, month or quarter when the boss says ‘Sorry Fred. You have not made your sales targets so we are unable to pay commission this month. What a pity you only missed your target by $30.”
If you know your numbers you can quickly compensate for the low days but also stretch yourself further so that you do get that pay rise or promotion. Why drift when by knowing your numbers you can quickly help yourself to rise above all your peers and lead the field in your chosen career.
Finally, doesn't it feel good when you exceed your sales goal. You immediately feel more successful and those who feel good about themselves always go on and do more!
I get absolutely amazed at the number of commission sales people working in retail that do not simply know their key sales figures. Then they wonder why they never make commission or never grow their income figures.
Why do they fail? Basically because they drift! They never go that extra mile! They never focus on the end result! They never think about how they can help their customer by finding add on solutions and thus growing their income.
So how do you change that?
Firstly, the sales person must believe they are working for them selves. They need to change their hand out mentality. Instead they need to take total ownership, accountability and responsibility for their role as a professional sales person. This means they must plan for their success. Be totally responsible for their results and be responsible for their own personal development. They need to stop being excuse merchants but to take total responsibility for their outcomes. After all they create their own destiny and have the power to change their income.
Secondly, they must plan for their success. This means setting goals. Many hate the “G” word. If you don’t know where you are going how will you know when you have got there. One of the most powerful things that you can do to build your own self esteem is to set goals for yourself as you can then measure your success. Not only does goal achievement make you feel good about yourself but achievement will flow in to making you feel more positive about your job and how you treat your customers. This will flow into making you more successful. As they say “Success breeds success”.
Setting goals for yourself, and I am not talking about boss imposed goals provides you with a great way of accessing your own performance. If you are under performing then it is like having a car that is misfiring. Do you need a tune up! In sales if you don’t know your numbers daily then how do you that your sales machine is misfiring. Once you know your numbers you can then take remedial action or seek help before it is too late. Where are the gaps in your performance? Are you asking enough customers for the sale? Are you having difficulty closing sales, handling objections, have enough product knowledge or having difficulty in building rapore with your customers?
What ever the problem unless you are measuring your performance daily you are setting yourself up for failure and the disappointment at the end of the week, month or quarter when the boss says ‘Sorry Fred. You have not made your sales targets so we are unable to pay commission this month. What a pity you only missed your target by $30.”
If you know your numbers you can quickly compensate for the low days but also stretch yourself further so that you do get that pay rise or promotion. Why drift when by knowing your numbers you can quickly help yourself to rise above all your peers and lead the field in your chosen career.
Finally, doesn't it feel good when you exceed your sales goal. You immediately feel more successful and those who feel good about themselves always go on and do more!
Monday, February 11, 2008
Business Owners Don't Buy Tax Deductibility
To be successful at selling anything to business owners you need to think like a business owner, not an employee. Sales people often struggle with this concept as until you own and run a business yourself some of the concepts are foreign.
The sales person tends to focus on the features of the product rather than address the key benefits to the purchaser’s business.
The classic statement a sales person will make is that the cost of this widget is tax deductible. Blah! Anything purchased for use in the business is tax deductible. Wake up! So what if it is tax deductible! It is a cost! A cost, is a cost, is a cost!
The businesses core reason for being is to make profits for their shareholders or proprietors. Selling something on the basis of increasing a cost does not make any sense to a business owner and in fact will dilute the respect they have for your advice.
Business owner’s buy for three key reasons
- How can it reduce business costs?
- How can it improve revenue?
- How can it improve business efficiency? In other words how can what you are selling improve profitability?
Of course there are other things a business owner will consider like service, convenience, processing times, past experiences and a multitude of other issues. Of all of these things the key reasons a business owner will buy will always come back to these three core reasons listed above.
So when selling to business owners all benefit statements need to be expressed in these terms –
“With our replacement warranty the cost of replacing a faulty printer during the extended warranty period can be reduced by 80%”
‘The cost of replacing the ink cartridges on this printer is 30% less than the nearest comparable model”
“The new Microsoft Office package has many forms and templates available which will save you time and help improve the efficiency in you office”
Sales people tend to make the classic mistake of trying to sell on price rather than focus on what that widget can do for the business expressed in terms mentioned above.
If you understand the key customer benefit, want, need, fear or frustration and then communicate your solution in a way that addresses those key things you are well on the way to creating an irresistible reason why a customer should buy.
The golden rule in selling is to think like a customer, put yourself in the shoes of your business customer and watch how over night your sales results will grow.
Wednesday, February 6, 2008
Handling Price Rises
Everyone hates a price rise!
"We can’t do that!", " It is too expensive!", " No one will buy that!", " We are uncompetitive!". The comments go on.
Interestingly having watched warranty sales people over many years handle pricing and product changes it is the sales person who has more problem with the price change not the customer.
Prices change daily up or down with any other tangible product with hardly a murmur but when it comes to the intangible product, “the warranty” all hell seems to break loose!
Sales results immediately plummet! Sales people stop asking! Confidence is gone over night!
Why is this? I guess over the years we have trained sales people to have great empathy with our customers. To put themself in the shoes of the customer so they can then position their sales presentation that satisfies the customer’s needs and wants and at the same time overcoming customers fears and frustrations.
The reality is the sales person is turning their thoughts “It is too expensive! No one will buy that! We are uncompetitive!” into their reality. In essence we all create our fears from our thoughts and so don’t take action because we are more scared of the perceived outcome; “They won’t buy that! Or, they are going to complain about the price.” In other words the salesperson has created a blockage to action in their mind which flows through to their words stopping them continuing to present the product in a positive light.
So how do we overcome this?
First the sales person needs to understand what is happening – their thoughts are creating their reality. Remove the negative thought and replace it with positive ones and overnight you will see a change in performance. You need to change the underlying belief levels.
This is a very powerful concept to understand and can be life changing for many people. Not only for selling warranty but all parts of life. Many people fail in life to achieve their dreams as they have already created their reality by thinking and focusing on all the reasons why they can’t do something, rather than thinking of the end result and all the positive things that will bring.
"We can’t do that!", " It is too expensive!", " No one will buy that!", " We are uncompetitive!". The comments go on.
Interestingly having watched warranty sales people over many years handle pricing and product changes it is the sales person who has more problem with the price change not the customer.
Prices change daily up or down with any other tangible product with hardly a murmur but when it comes to the intangible product, “the warranty” all hell seems to break loose!
Sales results immediately plummet! Sales people stop asking! Confidence is gone over night!
Why is this? I guess over the years we have trained sales people to have great empathy with our customers. To put themself in the shoes of the customer so they can then position their sales presentation that satisfies the customer’s needs and wants and at the same time overcoming customers fears and frustrations.
The reality is the sales person is turning their thoughts “It is too expensive! No one will buy that! We are uncompetitive!” into their reality. In essence we all create our fears from our thoughts and so don’t take action because we are more scared of the perceived outcome; “They won’t buy that! Or, they are going to complain about the price.” In other words the salesperson has created a blockage to action in their mind which flows through to their words stopping them continuing to present the product in a positive light.
So how do we overcome this?
First the sales person needs to understand what is happening – their thoughts are creating their reality. Remove the negative thought and replace it with positive ones and overnight you will see a change in performance. You need to change the underlying belief levels.
This is a very powerful concept to understand and can be life changing for many people. Not only for selling warranty but all parts of life. Many people fail in life to achieve their dreams as they have already created their reality by thinking and focusing on all the reasons why they can’t do something, rather than thinking of the end result and all the positive things that will bring.
You can change many of these negative thoughts by
- Developing positive self talk – "This warranty is cheap", "I am really looking after the customer by showing them the benfits of the warranty!", "We have got the best warranty in the market place!"
- Holding a team “Grist Session” to get out all the issues, to develop positive strategies going forward that help each other develop a positive mindset
- Create the right atmosphere that encourages a positive, supportive and fun loving, achievement orientated team
- Regular one on one coaching – this is very powerful and often overlooked and under valued
The other reality which is often overlooked by sales people is that the warranty is not being bought by the same customer every day. In other words your customer on average only buys a new Plasma or Fridge once every 5 years or so, and the customer doesn’t know the warranty price. Only you the salesperson is aware of any changes. Not the customer.
Remember the customer doesn’t buy price! They buy the benefits. Focus on the benefits and value the warranty brings. Not the price! In Part 2 of “The Secrets of Selling Extended Warranty” e-course I teach you how to understand those benefits. You can sign up for the course at the top right hand corner of this blog.
I look forward to hearing your thoughts.
To your sales success!
Alistair
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