Today almost every business conversation seems to start with how much things have changed. Selling is harder. Business is harder. Open any book and the first half seems to be filled with endless reasons competition is harder, whether it is because of the internet, global competition or the down economy.
Harder. Harder. Harder.
But what is really going on and what is a practical solution?
Today we are not simply competing against a similar product or competitor. We’re not even competing for a few of the dollars our customers have to spend. We’re competing against all of that but something even more difficult – their question of should they even spend any money at all. Let’s look at this.
3 Eras of US Business
This may seem like a history lesson or some kind of academic theory but it’s not. The US Economy has shifted and we need to know where we are before coming up with a solution. In broad strokes you can divide business into three movements that dictated how business was conducted.
- Expansion
- Indulgence
- Consequences
Expansion
Business in the US expanded from its founding to post WWII. From conquering the west, the building of railroads, to becoming the world’s leading producer, everything was high speed ahead – growth, expand, expand expand.
This set a mindset. While there were downturns the basic mode was MORE. We built and we did business BIG. This was the age of Robber Barons, IBM, GM. Monopolies and one job careers. The success of this era led to the next, the age of Indulgance
Indulgence
Nothing represents this era better than the 60’s generation – one rolling party after another. The gravy train was never going to end. We spent and then spent more. We reverse mortgaged out houses and spent that money. All levels of government spent beyond their means knowing that future debts would be simply paid for by future expansion. Not realizing that all bubbles burst, that bills come due and that expansion has limits we simply indulged.
This is important because that era lasted until 2008. However our thinking about business and selling hasn’t changed. We still think we’re selling in a world of either expanding resources or abundance. We compete with products and with a mindset that says “this much money is out there lets go get it. None of the former assumptions work in today’s world of consequences.
Consequences
Every challenge today can be explained by the fact that we are now paying the consequences of yesterday’s indulgence. From not having access to decision makers to the chasing of fewer and fewer dollars. Consequences.That is where we are today – the time and mindset we are selling into.
Large debts without the ability to pay them. Companies and individuals are no longer looking for where to spend their money (if they have any) but if they should be spending at all. This has dramatic implications that almost no-one has thought through.
Business is adrift. They need money but haven’t been built for an economy of consequences.
According to Forbes, business growth is the number one priority for almost every CEO. That pushes down to sales. Quotas are up across the board – and commission payouts are down. However in an economy of consequences where will that growth come from? Or put in a way relative to sales: where are the sales going to come from?
Selling is More Important than Ever
As I said earlier, we are not competing against other products. We’re not even competing against other businesses.Today people aren’t asking what they should spend on but rather should they spend at all. That is a profound challenge for sales – one I’m not sure we’ve prepared for.
We have products. We have product knowledge.
We’ve transformed sales, or tried at least, from being transactional to consultative.
We have SPIN Selling. ROI Selling. Value-Based Selling.
What do we have to offer when no-one wants to spend anything? Who is our real competitor then?
Lets get to the nub: in a world where neither the product or the company has enough value to pry limited dollars out of the wallets of wary prospects what will sell?
The Answer Lies in Sales being the Value Creator
Products are a commodity. Solutions are everywhere. Every salesperson is a trusted adviser and consultant. Every company is now the best, the innovator, the pioneer.
In a climate of consequences then what is the DIFFERENTIATOR?
Business still has to operate. They still have to buy and sell things. They still have to meet needs and fill their own needs. It isn’t that sales doesn’t work – it is simply that sales teams need to sell differently – not against other products and companies but rather against the push-back of spending money at all.
Winning is About the Right Sales Mindset
Today there is a hierarchy of needs that you will have to compete and sell to. You have to justify and move from each level to the next in order to make a sale:
- The first sale is that they will need to spend money
- The second sale must answer why money should be spent in your solution/product category versus all of the other needs of the enterprise or person
- The last sale, is getting selected as the vendor of choice for the category.
You must make all three sales today and in that order.
Doubt me?
How many deals have you had recently that pushed or even lost funding entirely? How many of your sales have simply gone away because budgets were changed or eliminated, often at the eleventh hour?
If you’re like the majority of my clients the answer is a massive number.
More sales seem to go away than are being lost. Knowing what you’re really competing against – what is really causing this collapse of opportunity – is the start.
The vast majority of training and preparation focuses sales on the last sale: the actual product/solution competition. In a latter post we’ll explore how to win the first two sales because without them there really isn’t any opportunity at all.