You’ll need to break with convention to sell in 2021 Sales is tough – we […]
You’ll need to break with convention to sell in 2021
Sales is tough – we all know that. Worse still, for many in 2020 – a year including a pandemic, restricted spending, lockdowns, redundancies and the largest economic recession since the great depression – it often seemed almost impossible. Now, as we advance further into 2021, for both salespeople and sales leaders it can just feel like you’re lurching from one issue to the next, unable to find the right way forward. Is anyone winning any new business? If they are, what are they doing differently?
Well, unfortunately, the past year has seen a resurgence of an old enemy – a tough competitor who is winning more and more of your opportunities. And the name of that competitor? The status quo.
No, not the 1970s rock band, but the preference for customers to either stay with what they have, or to resist moving at all until the future becomes clearer. This is completely understandable – when the world is riskier, people tend to take control of the things they can. Loss aversion also comes into play. There is a well-known study that was used to highlight the difference between logic-based and emotionally led decision-making. When offered a bet that guaranteed a small gain over the long term, respondents refused to risk their money. The researchers kept improving the odds to see at what point the respondents changed – it took until the odds were significantly in their favour before they’d take the risk. How much in their favour? Between 250% and 300% return on investment.
This might seem unreasonable, but put it in everyday terms. Think about your car. Assuming it is in full working order and there’s nothing driving a change, just how much better would another car have to be for you to swap? It should be obvious that if a salesperson reached out to you and offered only a slight improvement, then you’d maintain the status quo – why take the risk? In fact, if they offered only a few things that were improvements, you’d still be likely to stick to your guns. The research suggests that the new car would probably have to be better in most facets, and a lot better in some, to convince you to change.
So, if you’ve got to overcome loss aversion, confirmation bias and the riskiest market there’s been in living memory, how do you manage it? I’m sure you’d like me to give you a silver bullet, so here it is – you need to be nearly 300% better than the status quo in nearly all facets.
It sounds tough – and it is. However, it’s one of the biggest bugbears of my professional life because, in most cases, it is not something that the salesperson can do themselves. If, as a business, your product or service is the same as your competitors’ and it costs the same amount, you’ve made your salesperson’s job virtually impossible. It’s the job of senior management to give your salespeople an advantage over your competitors – so do it properly.
Personally, I believe a great place to start is with the book Blue Ocean Strategy by W. Chan Kim and Renée Mauborgne. It’s a revelation, and has lots of options to improve what you take to market. One of their key premises is the four-action framework. This approach asks you to look afresh at your industry and remove things that the customer no longer needs, and to improve what has never been improved. Simply ask yourself:
- Which factors of our value proposition can be eliminated because they’re not important to our customers anymore?
- Which factors can be reduced from their current levels?
- Which factors can be raised well above their current levels?
- What new factors can we create that we’ve never offered before?
The plan, as you’ve probably guessed, is to use the money saved from the reductions to fund the improvements. Oh, and did I say that you need to be cheaper? That’s vitally important too.
The endpoint, however, will be arming your salespeople with a lean value proposition that is both cheaper than its competitors, but does many things better than the pack.
So make 2021 a much improved year by giving your sales team the ammunition they need to smash both the status quo and your competition.
This article was written by Rob Allen for the Winning Edge Magazine