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Fear, Uncertainty and Doubt or more commonly known as FUD is a tactic used in the 21st century to manipulate customers into buying more of their product over the competition.
It is considered unethical when manipulating customers with a false information.
However buyers still act on these emotions, whether they are generated from their own perceptions or from sellers.
Through positive stories and focused on shared benefits, we can guide our customers to their uplands.
Sales people are human and can sometimes read their customers (i.e. other humans) wrongly.
Known as “Perception Bias”, its a type of unconscious bias that occurs when our perception is skewed based on inaccurate and overly simplistic assumptions about a group a person “belongs” to.
This bias may include biases or stereotypes about age, gender, and appearance.
We are sometimes in a Matrix of our own making.
We believe the customer is thinking X and will do Y.
We can get it wrong.
“Is that air you are breathing?”, from the first Matrix movie is the perfect question to challenge whether our mind is interpreting truth.
You never want the customer to hate you.
But when it happens, what do you do?
First option is to drop the customer. It may have appeal. You can’t change their opinions of you. Work to accounts that you have a better chance to influence more positively.
The second option is about trying to get the customer to see the light. However this “educating” often creates more heat than light. The customer knows that they are right, even when they are wrong.
The third option of empathy can be hard. It requires humility to understand the customers perspective. It’s especially hard when you think they are wrong.
Not to long ago, I worked for an ICT services company, I supplied consulting services for a large account worth about $4M per year.
Then something bad happened.
Our most senior technical consultant was unprofessional towards an executive at our customer’s company.
The executive was not happy.
Because our “guy” was led a small team and was creating had been promoted to team leader within our small team because of earlier contributions.
Unfortunately we could not remove him mid-project. So we tried to work with all parties to smooth things out until the end of the project.
Nothing worked. There was anger and frustration on all sides - especially our customer.
The only thing we could do was stay as close as possible to the customer. To listen to their frustration and be empathetic to their situation.
I remember one morning getting “drilled” by the executive about how bad we were. That this was damaging our corporate brand. He was right. I could not disagree in any way. My first instinct was to not like the guy. But as I listened to the executive I gained a much clearer view of his situation. Even though he was angry at us in the cafe, I felt sorry for him.
When our guy left, things started to get better. The customer was happy and projects continued on.
Remember the customer is always right. Even when you think they are wrong.
Your job is to serve them and build empathy for their situation.
It was 2018, and I had been working at a privately owned ICT Services company (Access Testing) and decided to leave and join a publicly traded company, DWS.
At the time my manager was retiring and I was convinced I had reached my limit in that company. I would have stayed if they had given me my manager’s old job, but that’s another story!
In the first 12 months at DWS, I worked hard and found some moderate success. Overall it was a good company. At times there were sales pressure and stress, which is normal to any sales job.
Then on one sunny afternoon I was contacted by a recruiter to entice me to a “new company” that peaked my interest. To this day I regret even listening to that guy! If I had of stayed at DWS, there would have been a few bumps, but I was on a good wicket and hitting my sales targets.
Instead I ended up accepting a role with a mobile app developer that was a bad fit for me and for them. If I had my time again I would have stuck with DWS and enjoyed a successful sales run.
The first two years of a sales role is the most challenging. You are yet to establish a track record of sales as well as mature relationships with important people in the organisation and industry that you work in.
Not surprising, according to According to HubSpot, the average sales rep tenure is only 18-20 months! That’s not even two years!
It’s a great tragedy when sales people do not stay for a good tenure. They waste all the energy of building external relationships with buyers and learning the product. Both the sales person and the company do not realise a full return on their investment.
So if you are starting a new job, consider the following:
Read The First 90 Days book. It guides you how to establish yourself in any new role.
Work your but off in the first two years! You need to achieve both short-term and long-term wins.
And be ready for a bumpy ride! You will get challenged by senior management to see if you are delivering. Show them both sales results and activities that lead to long-term success.
This strategy will work if you try it.
And finally if you manage to stay for two, three or four years, the job will get easier. You will understand the role and what’s needed for success.
Being successful in the role will give you more freedom.
Enjoy the ride!
I once joined a company, and their services were underpriced.
Sure, they were profitable. But compared to the value that they brought to the customer, I believed the price needed to be increased.
The problem was that the company viewed this service as an add-on to the main product, not a value driver .
In addition the engineers were doing the sales for the services they provided.
Engineers are great at designing and building things. However in general are terrible at sales because they complicate the sales process. They go into too much detail instead of identifying how they can solve the customers’ problems.
For example a car salesperson does not focus on the technical superiority of the car at the get-go. Unless there are technical questions, they will want to find out what the buyer is needing, what her priorities and motivations are.
Now back to my story. I realised in order to start uplifting the price of the services, I needed to first sell it to myself. If you do not believe your own pitch the customer will not believe it either.
Fortunately the more I understood the situation, the more convinced that a modest increase in price would be accepted by customers.
Selling to yourself is the most important step in being successful.
If you do not believe what you are offering will make a dramatic difference to our customers, then your customers will not buy.
The engineers struggled to sell value because sales felt “dirty” to them. Putting up prices was outside their comfort zone.
A higher price means we can deliver a better experience for the customer. When they are happy they feel they are getting a good deal.
The reverse is also true. When we sell cheap, we are looking for ways to cut corners to retain margins. The more we do this, the value chain gradually erodes. It s a lose-lose deal. They don’t feel they are getting good service, and consider us as expensive. How ironic!
As a result of reviewing prices, I tested the increased prices on new customers. When explaining it to the value they created, it was a no-brained.
After two years, the price leadership that I initiated was adopted globally. The customers were happy with the service and the business unit was happy because of the sustainable revenue. I was happy because value is being created and monetised for my customers.
In my sales career, I have experienced the feeling of being ahead of my sales targets budget and also behind. For some reason, the feelings of “being behind” are much more stronger and impactful on my emotions. I don’t know why.
When I am ahead in my sales targets, I just feel the absence of stress and loss, instead of feeling like I am a champion.
Scarcity is a principle that refers to the idea that people place a higher value on things that are in short supply or becoming less available.
In "Pre-suasion" by Robert Cialdini, the author provides examples of how marketers utilize the scarcity principle to drive people's behavior. For example, he cites the use of limited-time offers, which create a sense of urgency for people to take action, and the use of phrases such as "limited stock available" to make people believe that a product is rare and valuable.
Another example is the use of waiting lists, which makes people believe that a product or service is in high demand and therefore more desirable. These are just a few examples of how the scarcity principle is used in marketing to influence people's behavior and decision-making.
Microcontent refers to short, bite-sized pieces of information that are easily digestible and shareable. They can be used to help sales people be more persuasive by:
Providing clear and concise information: Microcontent makes complex information easy to understand and remember, making it easier for salespeople to get their point across.
Improving engagement: Microcontent is highly shareable, allowing salespeople to reach a wider audience and increase engagement with potential customers.
Building trust: By providing value and education, microcontent can help salespeople establish themselves as experts and build trust with potential customers.
Supporting the sales process: Microcontent can be used to educate potential customers, answer common questions, and provide compelling reasons to buy.
Microcontent is very important because buyers have very little time to listen to you. Think about the messages you share. How can they make a greater impact?
I recently managed a new customer sales opportunity which had a value of seven-figures in annual revenues.
Although my sales target had already been achieved, winning this one would be a great psychological victory over my competitors.
During the tender process we made a 110% effort to win.
Sadly, our bid was not successful!
The loss made me feel depressed and unhappy for the rest of the day! 😭
Afterwards one question remained: Why is it so difficult to win accounts that are held by competitors?
These reasons came to mind:
When you don’t have a direct relationship with the buyer you are always at a disadvantage
Companies rarely change their suppliers unless they are having BIG PROBLEMS
It is easier for buyers to change suppliers when the switching costs are low.
What can be done?
Firstly, a careful review of the buyer and their motivation needs to happen. There may be factions unhappy with their incumbent supplier, but is it a big enough problem for the EBI (Economic Buyer Influence) of the firm to do something about it?
Perhaps a survey to determine their situation will help you determine if the opportunity warrants major investment? If they are just going to market for a price check and have no intention of changing, perhaps a simple quotation will suffice?
Secondly if this opportunity is worth your investment, what factors help the most? Consider one of the following:
Eliminate all your setup costs. This approach reduces the switching cost for the buyer. It can be offset by a longer contract terms to recoup your investment
Offer something that “blows away” the competition. Something new that will garner excitement from sectors of the buyer firm. For example, can you boost their “green credentials”? Or can you leverage the latest advancements in Machine Learning (AI) that will propel them in their industry?
If you cannot win the customer over completely, consider a gradual takeover. Get on their books for something small and then excel at customer service and quality. Over time you will build a trusted relationship with them that will help you win the account!
Final Option: Change the Game!
And finally if the chance of winning is almost zero, choose to be disruptive. Change the game! Do not expect to win in the short term but find a way to question the value chain between those existing parties.
For example you could help the buyer save millions through helping them build an open source solution.
Taking the disruptive path can be very risky. So be careful. Avoid any strategy that could undermine your integrity and credibility to the marketplace. It is very difficult to rebuild from a damaged or lost reputation.
You can do it!
It is tradition for many companies at the end of each year to give gifts to their customers.
A few years ago my neighbour, John, called me with an unexpected offer to give me a gift. I got on well with John and he would often invite me to attend his multi-level marketing (Amway) meetings. I had previously declined these opportunities because they were not appealing to me at the time.
I was aware of the power of reciprocation, that by receiving the gift it would put me in John’s debt, and most likely he would invite me to his upcoming meetings. Only this time I would feel internal pressure to repay John by attending. I was left in a conundrum! If I accepted the gift I would feel compelled to accept John’s invitations to attend one of his meetings. If I refused the gift, I would be discourteous.
And to be honest, even with my understanding of this principle of Reciprocation, it would be very difficult to refuse an invitation to attend one of his meetings after accepting his gift.
So what to do?
For days I wrestled with that question.
Eventually I realised that this was a conscious plan of John’s to recruit me. With that perspective I no longer felt uncomfortable declining his gift.
The lesson has stayed with me because the power of gift giving influenced me into something I did not want to do.
In 1984, Robert Cialdini wrote, Influence: The Psychology of Persuasion. The six universal principles of persuasion contained in the book have helped millions to be more influential with others in their lives.
These principles of influence are:
Reciprocation
Commitment and Consistency
Social Proof
Liking
Authority
Scarcity
Reciprocation is when you receive a gift from someone which makes you feel compelled to return the favour.
According to one scientific study, customers entering a lolly or candy store are 42% more likely to purchase when they receive a small gift of chocolate upon entry into the store. The same principle applies to nearly every other type of product.
You will be most influential when your gift is:
Meaningful
unexpected; and
customised to the person receiving it.
If John’s gift to me was something I needed or wanted, its influence on me would have been much greater.
How can I use the principle of reciprocation to be more successful with my startup?
Here are a few suggestions….
Take your customers out for coffee. You are given them a free coffee and an excuse to take a break from the office. If they have a pleasant experience with you, they will feel a greater urge to return the favour in some other way. Enterprise Sales is complex and involves multiple stakeholders. Getting relevant and timely information about your customer and their decision process is vital to your sales success!
Do something for your customers in a meaningful way: Support their industry or user groups. Whether it is for law librarians or mining engineers. Spend time with them and try to help their cause. For about six years, I sold IT project services to government agencies. We would provide free educational sessions on Customer Experience and Usability to address their particular concerns. When we did this in the right way and it was needed. However there was an increase in demand for services from our customers.
Give them a gift. Customers love merchandise! It allows you to give them something that reminds them of your company. And if they love the gift... even better!
Consider offering freemium products. Giving a part of your product away for free is the ultimate reciprocation play. How can you do it without cannibalising your current business? That’s something you will need to work out.
Whether we apply reciprocation consciously or unconsciously, we all experience it. The more awareness you have of this power of persuasion, the better you can apply it.
Back in the late 1990’s, I was studying a business degree full-time at university. But I was getting bored with my part-time job at the hardware store. I wanted to feel the excitement of being part of a business and not just reading about it in a textbook.
Something needed to change!
After speaking with my friend, Chris he offered me my first sales job selling door-to-door security products. The work was commission-only, meaning if I would only be paid when a sale was made.
Chris took me out on a trial run and the work felt exciting and potentially profitable. Chris was a sales pro. He had developed a very relaxed approach to greet people at the door and make them feel comfortable. He connected instantly with people by being curious and light-hearted at the same time.
When he identified a suitable customer, he adjusted from relaxed to a razor-sharp sales pitch which gave him a very high success rate. However when he could not qualify them as a good customer, he would stay in his relaxed position and relocate to the next house.
Chris possessed a vast library of sales and influencing skills that simply went over my head at the time.
Feeling high in self-confidence I decided to give it a go. The first few weeks I was earning slightly higher than my previous job. I would usually only need to knock on doors for a 90-minute session a few times a week to earn a comfortable student living.
Then I had this brilliant idea. I decided to sell for an entire Saturday and make my biggest sale ever! My goal was to make enough money to afford a short holiday.
So the next Saturday I started nice and early. My energy and motivation was high because I knew what I wanted - more money!
The first hour of selling went by. No sales. That was okay. But then it stretched to two hours. I was feeling a bit anxious. I had ever gone this long without a sale. Was I doing something wrong? Was I targeting the wrong people?
Without realising it I had stopped trying to connect with my potential customers, and just my internal questions and fears. I finally made it to four hours of selling. I had come close but no sales. After lunch I kept going. This time I was on autopilot. I needed to talk to as many people as possible!
Finally after six hours of no sales results, I gave up.
Feelings of both failure and frustration swept my mind.
I concluded I did not have the charismatic or outgoing nature to ever be successful in selling.
Fast forward 20+ years, I have been fortunate to have had a rewarding career in sales. I would not swap it for any other job in the world.
David Mayer and Herbert M. Greenberg wrote a wonderful article in the Harvard Business Review (HBR) entitled, What Makes a Good Salesman (2006). https://hbr.org/2006/07/what-makes-a-good-salesman
To put it simply the best sales people have the following two characteristics:
They have strong customer empathy skills
They also have strong “ego drive” to achieve success
When these two characteristics are both high and with a salesperson, their chances of success will skyrocket.
In hindsight my friend, Chris had developed these skills in his door-to-door business. He developed a great connection with potential customers, knowing how to relate to them instantly. He also possessed high ego drive. Behind that relaxed exterior was a focussed and calculating sales professional who was highly motivated to achieve his numbers.
Key takeaways
As a startup founder, reflect on how you are connecting with your potential customers. Do you know how they are feeling? Do they feel you understand them? If the answer is maybe, then perhaps you can work on that?
Secondly we all need to feel accountable. It can provide positive pressure for us to reach the “unachievable”. I invite you to find a coach or mentor that will keep you focused constantly on achieving both short-term and long term sales goals.
