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To Cold-Call Or Not? Here's The Answer

Been tweeting (find me at http://twitter.com/honestselling) about cold-calling a bit lately, because a few people on Twitter have been bashing the activity itself, even though they have no real knowledge of how it can and should be done.

On Soapbox
Cold-callers are an easy "bash them" target, because so many people hate doing it and because so many people have been on the receiving end of bad cold-calling tactics.

I personally believe only a cowardly bully would bolster himself by bashing easy targets.

But that's me.
Off Soapbox

Anyway, I figured I'd do a quick brain-dump of my thoughts on cold-calling so anyone reading this can decide whether to learn how, and then, when and whether to give it a go.

I'll be brief but try to cover everything important. As soon as you find the reason you should not cold-call, you can skip reading the rest.

Should You Learn How To Cold-Call?

There are really only two good reasons to learn how to cold call effectively:

1. You truly love repetitive tasks -- so repetitive they become almost brainless -- and want to control your own income. (Note: Only about 2 percent of the population fits this mold, so there's a 98 percent chance you should not cold-call as your primary means of finding clients or customers.)
2. You want a contingency plan for any time you're in the famine cycle on sales. (Note: It's actually kind of comforting to know that you can find a client and close a deal within one week any time you want to or really need to. I mean, if your family needed feeding and you could find a client using honest cold calling, would you temporarily be willing to do it? If so, then by all means learn how.)

So if you both hate repetitive tasks and don't feel the need to have the cold-calling arrow in your client-acquisition quiver, then stop reading now.

The Right/Wrong Way To Cold Call

There are really only two ways to cold call, and the best way I know of to explain the difference is to discuss the objective of every dial:

1. Wrong: Your objective when you dial the phone is to set a sales appointment or close a sale with the person on the other end of the line.
2. Right: Your objective when you dial the phone is to find people who enjoy buying from cold-callers. When you find they do, you then start the process of building a buyer-seller relationship. When you find they don't, you NEVER CALL THEM AGAIN.

Here's the deal. Only 5 to 10 percent of the buying public will regularly answer the phone, listen to an honest cold-call offer and make a yes/no decision without being pissed that you called. And at any moment in time, only 1 to 2 percent of this small group is ready to buy right now. So if your objective is to "close" everyone you call, it's no damned wonder most of the people you call hate your guts.

However, when your objective is to find the people willing to take your calls and willing to buy when the timing is right, then only the rare idiot will rant and rave when you call (you'll suffer from his wrath toward others who called him using the wrong approach).

The Manipulative Vs. Honest Approach

Manipulative salespeople do whatever it takes to keep you on the line, keep you talking and keep you engaged, because they're too stupid to understand that it's faster, easier and better to build relationships before trying to make the close.

Honest salespeople:

• Make EVERY attempt to disqualify the people who don't want to be called at all, so they can remove them from the call list and NEVER waste their time or their prospects' time calling again.
• Give their true prospects (people willing to buy from a cold-call), EVERY chance to say "No" to "today's offer," so they can build an "I'll take no for an answer" relationship and keep the door open to CALL BACK.
• Respect the time of every person they call. (Even with true prospects, you should never exceed about 20 seconds on your ENTIRE offer. Anything more and you're officially a salesdrip, because you effectively put your own needs and desires ahead of the needs and desires of the people you're calling.)

A Few Summary Points

When a cold-calling system is working, it hardly ever changes. That's why implementing one on a daily basis is so repetitive. All the guess-work, analysis, configuring and tweaking goes into creating the system. After that, it's pure repetition that makes it work.

There are typically two types of minds involved in creating a killer cold-call system and making it work long-term.

• The creative genius who figures out how to make the system work (that's why guys like me get paid).
• The heads-down implementers who actually enjoy banging away at the phones all day.

I will personally dial the phone like a madman in either of the following situations:

• I've been hired to create a cold-calling system and I'm solving the puzzle of how to get it to work.
• I got lazy on my other marketing efforts, ran out of cash and need to pay the rent. (Nice to have this arrow in my quiver when I need it.)

So learn cold calling only if you love repetitive tasks and want to control your income, or if you want the ability to find a buyer and close a deal quickly, should your other marketing efforts suddenly dry up.

As for my last request, I wish everyone who hates cold-calling (because you don't like doing it or because you hate getting called by idiots who do it poorly) would stop bashing the entire profession. There are a lot of outstanding people out there who suffer the effects of your thoughtlessness while working their asses off to earn an honest living taking care of the people they call.

I think they deserve a break and would greatly appreciate your giving them one. (Thanks!)

Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association

Rules Of Gambling, Rules Of Selling

One summer during high school, I was working with Dad on a small remodeling project -- we were enclosing the back porch of a single-family flat in the city. Our customers were a young, recently married couple. He was a Lutheran pastor; she was a nursing student.

My first task early one Friday morning was to remove the door from the back of their house -- turning it into an open doorway -- and reinstall it at the entrance to the newly enclosed porch. The door opened into the kitchen, and as I began my work, I noticed the couple was having coffee at the kitchen table and discussing the pastor's sermon for Sunday.

I had long before learned that the best way to avoid the appearance of eavesdropping was to point out I would be unable to not hear what was being said. In this particular case, the pastor replied, "No problem. In fact, I'm creating a sermon on gambling and struggling to decide how much money is too much to bet. What would you say?"

I offered to share Dad's rules of gambling; the pastor eagerly accepted.

1. Never make a bet you can't afford to lose.
   I once heard a story that Michael Jordan bet one million dollars on a golf game. Whether he actually made that bet or not, I'm sure at any given moment he could easily part with that much money. So while this may be an absurd bet for most of us, for him, it's actually reasonable.
2. Never bet into the other man's game.
   Amarillo Slim (a famous poker player and gambler) once challenged tennis pro Bobby Riggs to a game of table tennis with the caveat that he (Slim) could choose the paddles. Riggs, an experienced Ping-Pong competitor, jumped at the chance to take Slim down a notch -- immediately accepting the challenge. Slim chose iron skillets for paddles and promptly cleaned Riggs' clock.
3. Never bet against the odds.
   Casinos are virtual money machines, because there is not a single bet that can be made where the casino does not have the odds advantage. And when someone develops a system that will flip the odds into his or her favor, the casino will not only ban that person from the building, it will warn every other casino in the world to be on the lookout for the individual. (The one time I ever entered a casino, I went with the express purpose of either having fun losing $100, or walking out with $1,000. I spent three and a half hours at the $10 craps table. I got to $850 before I experienced a meteoric series of bad rolls that completely wiped me out. It's the most fun I've ever had spending $100.)

But what does this have to do with selling?

1. Never go on a sales appointment you can't afford to lose.
   You can't negotiate from a position of power unless it's easy to walk away. If you've ever purchased a car, then you know the best way to get what you want is to walk out of the showroom. Imagine how less powerful that tactic would be if the tables were turned, and the salesperson simply did not care whether he or she sold you a car. (I know a car salesman whose marketing efforts produce more than 10 sales opportunities a day. Threaten to walk away from the deal he shows you, and he'll smile while he opens the door.)
2. Never sell using the prospect's buying system.
   While I'm all for matching your sales process (the order things happen) to your prospect's buying process, I don't advise changing your sales system (what happens) to the prospect's buying system, lest ye find yourself hitting Ping-Pong balls with frying pans. So if you've decided to never submit a proposal without speaking personally to the decision maker, for example, then stand your ground when a prospect asks you to do exactly that. (Note: Following Selling Rule 1 makes this a lot easier to actually do.)
3. Never bet against your own odds.
   The best reason to carefully track every aspect of your prospecting, marketing and selling efforts is to determine your personal odds, so you can make smart choices. Suppose, for example, you close only 5 percent of the deals for which you submit proposals without first speaking to the decision makers, but close 75 percent when you have those conversations. When the prospect demands the proposal without that conversation, reply with "I'm not willing to create a proposal without first speaking to the person who will actually sign it. Where do we go from here?"

I've spent more than 40 years applying variations of Dad's gambling rules when betting on business, on love, on life.

And, I've won far more bets than I've lost. (Thanks, Dad!)

Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association

Measuring Your Sales Funnel (Part 4 of 4)

In Part 1 of this four-part visit, I outlined the goal of this series on measuring your sales funnel, explained some key rules to apply to determine whether a prospect is in your sales funnel and gave you some guidelines for segmenting your sales funnel into different levels you can track.

In Part 2, I explained how to measure your actual sales funnel and how to look at your target vs. actual funnels, so you could easily determine what you should change.

In Part 3, we discussed getting inside your prospects' heads, so you can better tell where they are in their buying cycles and make smarter decisions when dealing with prospects.

In today's visit, we'll talk about relationships between sales managers and salespeople, and then tie everything together so you can make a quantum leap forward in sales success.

The Brutal Reality Of Bad Relationships

The first step to fixing anything is to understand what's broken. So I'll start this relationship subject with the bad and the ugly -- the thoughts usually left unspoken.

You know how every human has an internal voice that never shuts up? That always says what it thinks? That doesn't care about political correctness or the other person's feelings? To help you understand one another better, I'm going to share with you some internal-voice comments that have been shared with me by sales managers and salespeople.

For many people, this is not going to be enjoyable, and it is definitely not going to be warm and fuzzy.

But it will be honest.

Sales Manager's Internal Voice Venting

I'll bet that just about every sales manager managing more than five people is dealing with at least one salesperson who drives him or her nuts. If you're that one, then here is some of what your sales manager's internal voice is probably saying to or about you:

• If there is anything that will always amaze me, it's your limitless ability to blame others for your failures.
• I don't give a hoot what you think might happen with the prospects you've been trying to close for 18 months, and it is not possible for me to be more bored with your complaints about their not acting the way you think they should act.
• If you tell me once more how you can't close at this price, I swear I'm going to drop our prices for a month and then fire you when you can't close at those prices either.
• If you held a gun to my head, I would rather have you pull the trigger than listen to you complain about how the marketing material we supply is not good enough, the website we built is not supporting your selling efforts, the cell phone service we provide is cutting out, the laptops are not fast or light enough, or the customer relationship management system is too difficult to use.
• I've told you a dozen times that the prime time for contacting our prospects is 1:30 to 3 a.m. Yet, in the six months you've been here, I have yet to see you place a single call during that time frame. What, exactly, don't you get?
• If you mention once more how our top salesperson has an unfair advantage, I'm going to show you "unfair" by giving your accounts to [him or her].
• Why can't you just dial the phone and talk to people? It's not rocket science. You don't need hours of analysis to create the perfect offer, because there is no such thing as the perfect offer. Just dial the phone, say what I've taught you to say, learn from the experience and change things as you go.
• Congratulations! You've delivered 37 contracts this year! Whoop-de-frickin'-do! Do you realize that only two of them got signed? And do you have any idea how much it costs this company in man-hours to draw up one contract?
• I'm a sales manager -- not a psychic, not a statistician, not a sounding board and not your mother! In order for me to earn my paycheck, I must do one thing and one thing only -- I must make sure everyone on this team hits or exceeds certain numbers every year. And your subjective guesswork about what might happen, unfounded optimism when evaluating your sales funnel, and complete pessimism when discussing this company and its products and services are flat-out driving me nuts.

Sales Manager Helping

• Tell me you've decided to blow off a prospect who is driving you crazy, and I'll respect you for the decision to cut your losses, help you figure out how to spot the no-win prospects faster and even call that prospect's boss to see if we can circumvent the showstopper and put this one back into your win column.
• Tell me why the last 200 phone calls failed, what you learned from that failure and what you're going to change so that the next 200 phone calls don't fail. Do that, and I'll work with you on anything you need to improve.
• Buy a book on cold-letter writing, and I'll reimburse you for it. Read it and tell me what you've learned, and I'll help you craft your first letter, pay for a professional ad writer to make it rock, hire a copyeditor to perfect it technically and even help you stuff the envelopes.
• Tell me you want to record a four-hour dialing session, and I'll not only buy the recorder, I'll listen to all four hours of the session and work with you to improve your results.
• Give me the recorder and ask me to dial the phone for the same four hours so you can hear real-world examples of how I want you to talk to prospects, and I'll gladly do exactly that.
• Tell me the exact words the prospect used when he said our prices are too high, and I'll help you figure out how to change your behavior so you can close at any price we choose.
• Tell me how you changed your sales process so you can close deals without using our marketing material at all. I'd like nothing better than to have our entire team selling without marketing superfluff, because I'm not that thrilled with the material either.
• Share with me the workaround you created that lets you enter data into our computer system in half the time, and the first time you can't figure out a workaround, I'll go to bat for you to have the system changed to accommodate your needs.

Bottom Line -- Sales Manager To Salesperson: If you want to find the greatest asset you have for being successful, look in the mirror. Then after you've done that, if you want to find the second greatest asset you have, knock on my door. Together, that person in the mirror and I will help you set sales records you never imagined you could achieve.

Salesperson's Internal Voice Venting

Just as good sales managers get frustrated with bottom-tier salespeople, good salespeople get frustrated with bottom-tier sales managers. And their frustrations are usually stronger, I'm afraid, because of the power their inept managers wield.

Not that it will do much to change things, because inept sales managers tend to believe they're great, but here's what good salespeople in this unfortunate situation think about the idiots who manage them:

• How can you pretend to know more than I do about sales when you've never sold a damned thing?
• If you change compensation models again, I'm going to quit, because this company's problems have nothing whatsoever to do with our compensation model. By the way, after I quit, I'm going to violate my non-compete agreement by going to work for our biggest competitor. And when you sue me for it, I'm going to launch a nationwide public relations campaign to beat you over the head with your own stupidity!
• I know you believe there is no "I" in "team," and I know it's your job to make the sales team successful. But I don't get paid based on the team's results. So instead of wasting my time with your team-building garbage, how about letting me use that time to go sell something? Or better yet, let's use that time to get some pros in here for regular training sessions, so we can all grow as professional salespeople?
• Speaking of training, what management training have you taken? And when was the last time you bought a book on how to manage salespeople? How about practicing what you preach just once and learning something yourself?
• Stop living in a world of hype and false information. Find out what really works from successful sales people, not sales psychologists, and pass that along to me. I want to know what they do and how they do it, backed up by real statistics.
• Listen to me once in a while, because I'm out there and sometimes when I tell you the prospect absolutely will not bite at that price, it's because I know what the hell I'm talking about.
• I know the prospect is in Joe's territory, but you and I both know Joe couldn't sell water in the desert. So either turn me loose, or do something to help Joe close this deal. And, by the way, how about a referral-level commission since I produced the lead?
• Have you heard the saying "It's a flat world"? There is no such thing as geographical territory anymore. So how about dropping the false boundaries that are stopping me from selling?
• I'll make a deal with you. You let me know when you want a report on my sales funnel, and I'll let you know when I want your advice on how to sell. How's that sound?
• I'm a salesperson -- not a team catalyst, not a mentor to the people you can't manage and not your "personal project." My goal is to find prospects, build relationships and close deals, and I get paid only when I accomplish all three.

Salesperson Helping

• Start selling with us, so you get some in-the-trenches experience to back up your opinions, and not only will you learn our real-world issues, but I'll have respect for what you say.
• Bring me any idea or technique you've learned from someone on our team and I'll not only pay attention, I'll actually try it to see if it works for me too. And I'll even report my results back to you, so you can help the people who created the idea improve.
• As for your team goals, I certainly understand your job is to make everyone successful. And as a good company employee, I'm glad to offer some help. But don't expect me to sacrifice my own results to help you do your job. Look in your own mirror to find the asset you need to build this team. After that, knock on my door and let's get going.
• I firmly believe that which doesn't grow will die. So I will fully support any effort with the goal of training every person at this company to be better at his or her job. But I will not support selective training efforts designed to mask the incompetence of one person or group.
• If we must have territories, fine. But if you want this company to sell like mad, incorporate a foot-in-the-door payment structure that rewards salespeople like me who are great at finding opportunities in all territories. I'll give one-third of my sales commission to any salesperson who uncovers an opportunity in my territory and hands it to me. How about finding out whether the rest of the team will do the same thing?
• As for our computer software, it was written for managing customers, not producing them, and it slows me down beyond belief. So either come up with a new way for me to report my sales funnel, or suffer the consequences of reduced sales due to abnormal admin time.

Bottom Line -- Salesperson To Sales Manager: If you want me to hit the numbers you've set, realize that from my perspective there is no "team" in "I." And please be more efficient in the time you spend keeping me informed, and the time you make me burn keeping you informed.

Insights

In most cases, salespeople and sales managers never share their negative, internal-voice comments. But the frustration that generates those comments is real, and, unfortunately, present on most sales teams. That's why it's important to get inside the head of your counterpart -- only by walking in the other person's shoes can you glean the insights you need to improve.

So let's glean a few of those insights by looking for common ground between sales managers and salespeople:

• Both want respect.
• Both want efficiency, clarity and objectivity.
• Both want to succeed; although, they do have different goals.
• Both want help succeeding, but both seem to want to be left alone unless they ask for help.
• Both understand the need to fulfill the other's requests, even if it burns some personal time.

Bottom Line: Both want the company, the team and each other to be successful, and are willing to contribute to those successes, but not at the cost of their individuality or their focus on their personal goals.

Tying This All Together

There are a host of reasons I prefer to track and measure sales funnels the way I do (as described in this four-part series). Some of the major ones are:

• Efficiency Of Salespeople's Time: Even using a paper system to implement this sales funnel measurement process, one salesperson can track and report his or her entire sales funnel in less than three minutes per day, because the only things being tracked and reported are those the sales manager needs to know to positively effect change. Add to that the wasted time -- worry time, guesswork time, contract prep time -- that is recovered by understanding what his or her prospects really think, and you have a huge net time gain for this (and every) salesperson.
• Increased Sales: Taking off the rose-colored glasses and looking at brutal reality from your prospects' points of view will always produce more sales, because it keeps you from letting optimism cloud your judgment. And once you eliminate the tire-kickers from the mix, you'll know exactly where to spend your time on any given day.
• Better, More Prolific Management: Using this measurement process also forces sales managers to take off their own rose-colored glasses, which helps them build more solid, trust-based relationships with their team members. And they can more easily tell what's working and what isn't, so they will know what to change and how to change it. Plus, being able to tell which salespeople need help at a glance (comparing target vs. actual funnels as described in Parts One and Two) eliminates the problem of driving the good salespeople crazy with advice.

 

Bottom Line -- Me To You: Measuring sales funnels this way makes sales managers and the salespeople responsible for not only their own actions, but for the success of their counterparts.

If you and your team want to make a quantum leap forward in sales results, go back over this article series, do every bit of homework suggested, and implement the measurement process on paper (call me at 314-416-1440, and I'll send you a form and additional instructions that will help).

And after you've done it for a month or two, call me with any problems you're having doing it. I'll spend 30 minutes on the phone with anyone, any time, provided it's a serious discussion about making improvements to sales results.

--
Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association

Transitional Pain

The more stuff I sell or help my clients sell, and the more stuff I buy, the more I'm convinced that transitional pain is the biggest reason prospects decide not to buy.

What is transitional pain? It's the pain you will always experience any time you change anything.

A week ago I promised to have Part 4 of my four-part series on measuring sales funnels finished by this week Wednesday (two days ago). Why do you not have Part 4? Transitional pain.

You see, last week I switched from mail-merge delivery of "Visit the Sage" to FeedBlitz delivery. And that switch, while I'm convinced was a good choice, is a painful process to say the least. (Basically, I've got a bunch of subscribers experiencing difficulty with some of the spam-avoidance tools FeedBlitz is using to keep their users safe. For example, one subscriber's e-mail address "looks too much like it might be faked," so FeedBlitz won't let him subscribe using that address.

It's this transitional pain, or the fear of it, that very often keeps people from buying what you're selling. Which is why I strongly recommend you discuss transitional pain with your prospects while you are in the sales process. Basically, tell them everything they'll go through after they buy, while they are making the switch to your product or service, because their fear of transitional pain will always be greater than reality, so telling them everything actually increases the chances they'll buy.

As for Part 4, please bare with me as I work out the kinks in the FeedBlitz armor.

--
Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association

Measuring Your Sales Funnel (Part 3 of 4)

In Part 1 of this four-part visit, I outlined the goal of this series on measuring your sales funnel, explained some key rules to apply to determine whether a prospect is in your sales funnel and gave you some guidelines for segmenting your sales funnel into different levels you can track.

In Part 2, I explained how to measure your actual sales funnel and how to look at your target vs. actual funnels, so you could easily determine what you should change.

Today's post is on getting inside your prospects' heads, so you can better tell where they are in their buying cycles and better predict when they'll close, or when you should stop trying and save yourself an enormous amount of time.

Imagine, If You Will ...

We're going to do some pretending for a few minutes. In this scene, you're shopping for a new car -- you're the prospect, not the salesperson.

Got your buyer's hat on?

Good.

Now imagine the conversation that happened between the sales manager (Bob) and his salespeople long before you walked into their showroom -- the one about the process he wants them to walk you through to close the sale in your first visit to their dealership. How they're supposed to ask you a series of questions designed to get you excited about the car. How they should start outside if it's sunny, or inside if it's a dreary, ugly day. How, when the timing is right, they're supposed to get you back to their desks to crunch numbers, discuss options and toss out scarcity conditions, such as the deal they're running that ends today. And, when they get you to finally make an offer on the car, they're supposed to leave you sitting, while they go "run it by" their sales manager to see what he says.

Now imagine you walk into their showroom and the salesperson (Greg) greets you then immediately starts playing his game -- begins to lead you through his sales process like a dog under command.

How long, exactly, will it take you to to see through this? One minute? Five? (I doubt longer than five, because when you walked in you knew you were entering hostile territory, so your manipulation radar was undoubtedly tuned to its maximum setting.)

Of course you're smart enough to see through this garbage -- the vast majority of intelligent adults are. And you're also smart enough to let Greg continue anyway, because you know that doing so is your best way to gather information and better arm yourself for the salesperson at the next dealership you visit.

You listen. You nod. You ask intelligent questions. You even test various objections to see which ones will get you the best deal later.

You throw out a ridiculously low offer just to test the waters. Of course Greg acts surprised at how low it is, and carefully sits back in his chair, so as not to appear threatening, while he says "I don't think Bob will go for that" then leans forward, one elbow resting on his desk, as he whispers to his new best friend "but I'll do my best."

Of course, at whatever point you finally tire of the game, you thank Greg for his time, promise to get back to him later, and turn south as you exit the lot, because the next dealer is in that direction.

Now imagine the utterly pointless conversation between Bob and Greg as they talk about how Greg successfully navigated you to step seven of their eight-step sales process -- and how they can probably salvage the sale by "following up on the phone in two days," or by "inviting you to their barbecue next week."

And think about the sales funnel report Bob will give the president of the dealership -- the one that says you're on step seven of the eight-step process, so there's a 92 percent chance they'll sell you the car within two weeks.

Do you want to be the executive who uses this information to predict your budget for next month?

Back To Reality

You're a salesperson (or sales manager) again. Do conversations like the ones described above -- about your sales process and your prospects' positions in that process -- sound familiar? How about the plotting and planning that happens when a prospect interrupts your process, or forces you to change directions?

And how many times have you found yourself feeling like a prospect was just about to close, only to learn through phone calls not returned and appointments not kept that you once again have no chance whatsoever to make that one sale?

Yes, you should organize your sales process to ensure that you do not miss anything. Yes, you should have a step-by-step approach for selling, so that you're prepared to work with a prospect who actually is willing to buy the way you sell. Yes, you should measure your results against that process, so you can tweak your methods and gradually improve them over time.

But gauging any individual sales opportunity based on where you are in your sales process is totally useless, and a huge mistake when it comes to budgeting, because it's not where you are in your process that counts, it's where your prospect is in his or her buying process that truly tells the tale.

It's The Buyer's Way Or The Highway

To effectively measure a sales opportunity, and thereby predict the likelihood that it will close, you must measure it from the point of view of the prospect to whom you are selling. You must get inside the head of your prospect and measure exactly where she is in her buying process. You must understand the decisions she will make before signing on the dotted line, and you must ask questions that will tell you her answers to those decisions.

To demonstrate how you accomplish that, let me be your sales manager for two of your current sales opportunities.

First, go through your list of opportunities and select one that is In Progress and one that is Contract Out. For each of those two opportunities, I'm going to ask you a series of questions. Because I really don't care what you think might be in the prospect's head, you are allowed only two answers: Yes or No. If you answer with anything but Yes or No, then the answer automatically becomes No.

If you burp, grunt, sneeze or fart instead of answering, then the answer is No.

Got it?

Here goes.

Pick one of your two prospects. On a blank sheet of paper, write the company name and the name of the person to whom you are selling at that company. Write down what you think you are selling (best guess as to what the prospect will buy) and your best guess as to what the account is worth to your company. Write the date you had your first appointment, and the date of your next appointment.

Note: I'm numbering these questions so you can write the numbers 1 to 16 on your piece of paper and place the Yes or No answers next to them. However, these questions do not have to be answered in a linear manner. Treat every one like a milestone that must be met. It doesn't matter in what order these questions get answered -- it's merely important to get them all answered "Yes" before you submit your contract for signature.

Now answer all the questions honestly (remember, I'm your sales manager, so for this exercise we work for the same company):

1. Have you and the prospect agreed on the objective he or she is attempting to achieve?
2. Have you and the prospect defined status quo (the starting point), and how to measure it?
3. Have you and the prospect agreed on the end result, and how to measure success?
4. Does the prospect have the ability to effect change at his or her company?
5. Does the prospect want to effect change?
6. Have you identified the person or people with the authority to effect change, and are they on board at this point?
7. Have the people who can stop this deal been identified and managed?
8. Can we actually help the prospect achieve the objective?
9. Does the prospect agree that we can help his or her company achieve the objective?
10. Have you and the prospect agreed on the date [the project will start?] [the items will be delivered?] (Insert your own wording to describe the starting point for the deliverable.)
11. Have you and the prospect agreed on an end date?
12. Is the start date within our normal sales cycle time frame? (If your normal sales cycle is six months, and the prospect wants to get started in two years, then something is wrong.)
13. Have you communicated the costs for our solution to the prospect?
14. Has the prospect agreed that these costs are reasonable?
15. Has the prospect allocated the budget for our solution?
16. Have you and the prospect done the math to determine the prospect's return on investment if he or she chooses our solution?

Bottom line: These are the 16 things that prospects will always answer for themselves before they buy. So you can either assume you know what the prospect is thinking, or you can ask the prospect questions designed to learn exactly what is in his or her head on each of these issues. And if you submit a contract before getting Yes answers to these 16 questions, you are, quite simply, screwing up.

To drastically increase your success at closing deals, for every sales opportunity in your current pipeline, answer these 16 questions Yes or No. Then, for every No response, go back to the prospect and have whatever conversation you must have to turn that answer into a Yes. Then, once all 16 questions are Yes, submit your contract for signature.

And to make it easier on you, here is a form you can use to track every opportunity in your sales funnel. Just check off any question where the answer is Yes, and work with your prospects to get the remaining questions answered in the affirmative. (Note: Because this is not a linear measurement process, sometimes answers that were Yes change back to No during the sales cycle. When that happens, uncheck that question, and work with the prospect to change the No back to a Yes.)

In our next visit, we'll talk about the relationship between sales managers and salespeople that use this method of measuring sales cycles, and then tie everything together so you can make a quantum leap forward in sales success.

--
Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association

Measuring Your Sales Funnel (Part 2 of 4)

In Part 1 of this four-part visit, I outlined the goal of this series on measuring your sales funnel, explained some key rules to apply to determine whether a prospect is in your sales funnel and gave you some guidelines for segmenting your sales funnel into different levels you can track.

Today's post is on measuring your actual sales funnel and determining what to change.

Measuring Your Actual Sales Funnel

Your first task is to get your list of current prospects and recent closed deals organized into the four levels we discussed last time. Start by using your favorite spreadsheet software to generate a list of every prospect to whom you are currently selling and every prospect to whom you sold within the past 30 days. Include at least the following seven columns:

• Opportunity ID (Combine the name of the company and individual to identify your sales opportunity, e.g., Three Tiers Creative -- Joe Jones.)
• Contact Phone (Enter the phone number of the person listed in the Opportunity ID column.)
• First Appointment (Enter the date of your first sales appointment with the prospect, regardless of whether it was in the past or is in the future.)
• Next Appointment (Enter the date of your next appointment or next step with this prospect. If it's an appointment, enter the exact date and time. If it's "Call next Thursday," type that.)
• Contract Out (Enter Yes if you have already closed the deal or have sent the contract and are waiting for a signature.)
• Closed Date (Enter the date the contract was signed.)
• Sales Funnel Level (We'll cover this below.)

Create your entire list before you continue.

I assume that you understand the four levels of the sales funnel as described in Part 1 and have already done the math to establish your target sales funnel. (If not, go back and do it before you continue.) You must now determine the correct funnel level of every sales opportunity and sale and enter that into the Sales Funnel Level column. Do that by following these steps in order:

1. Set the Sales Funnel Level to 4 (Closed Deals) for every client/customer with whom the deal has closed within the past 30 days of today's date. (If you accidentally listed deals that closed further in the past, delete those rows completely; we're tracking based on monthly targets only.)
2. Set the Sales Funnel Level to 3 (Contract Out) for every opportunity where you've delivered the contract and are waiting for a signature, and you have a follow-up appointment set at a specific, future date and time. For all opportunities where the contract is out but no specific appointment is set, enter Stalled. (In Phil's case, he would set the Sales Funnel Level to 3 for any prospect where he had verbally closed the deal but has yet to deliver the contract for signature.)
3. Set the Sales Funnel Level to 2 ( In Progress) for all opportunities where you've already had the first sales appointment, and you have a next appointment set at a specific, future date and time that is within 45 days of today's date. For opportunities where you've had the first appointment, but the next appointment is not specific, is in the past or is beyond 45 days, enter Stalled.
4. Set the Sales Funnel Level to 1 (First Appointment) for every prospect with whom your first appointment is a specific, future date and time within 21 days of today's date. For opportunities where the first appointment is not specific, is in the past (you called yesterday but the prospect didn't answer), or is beyond 21 days, enter Stalled.

At this point the Sales Funnel level should be set to 1, 2, 3, 4 or Stalled for every opportunity. If any opportunities are still blank, you'll need to figure out why and fix them before you continue.

Now pick up the phone and call every prospect marked Stalled, to see whether he or she is willing to set a specific appointment. A call, for example, might go something like "Hi, Joe, This is Gill Wagner. I have it in my calendar to call you sometime next Thursday to discuss sales training for your team. I was wondering if you'd be willing to set a specific time for that call, so we don't end up in a game of phone tag." (Use your imagination -- you'll be amazed at how many people say "Yes" to this simple request.)

Determining What To Change

To determine what behaviors need changing, you need to literally draw a picture of your current sales funnel by counting the number of opportunities in each level (ignoring the stalled ones) and depicting them in a graphical manner. Then, by comparing the graphical representation of your actual sales funnel to the graphical representation of your target sales funnel, you can quickly see what you need to change.

Here are two very typical patterns I find when working with new clients.

Salesperson: Joe Jones
Level	Target Funnel	Actual Funnel
1 - 1st Appt.	* * * * * * * *	* *
2 - In Progress	* * * * * *	* * * * * * * * * * * *
3 - Contract Out	* * * *	* *
4 - Closed Deals	* *	*

Take a close look at Joe's sales funnel representations above and compare two things:

• Target numbers to actual numbers of each level
• The ratios between levels within target to the ratios of levels within actual.

Here's what I see:

• Joe has closed only one sale in the past 30 days compared to the two he should have closed. But is Joe's problem that he can't close, that he doesn't have enough opportunities to close, that prospects won't sign the contracts he gives them, or something else?
• Joe's ratio of Contract Out and Closed Deals is 2 to 1 in both target and actual columns. So getting prospects to return signed contracts isn't the issue.
• Joe has far more prospects In Progress than he should have. And his ratio of In Progress to Contract Out is way off. This suggests that he could probably use help at identifying tire-kickers (and getting them out of his funnel altogether) and at moving people more quickly through his sales process so he can get them to the Contract Out stage.
• Joe obviously has far fewer First Appointments than he needs.

Literally at a glance, Joe's sales manager (even if it's Joe himself) can look at his's target vs. actual sales funnel patterns and see that Joe is avoiding prospecting in favor of "keeping himself busy" with prospects who are probably never going to buy. And by knowing exactly what to fix, the sales manager can make incredibly smart choices when it comes to training, coaching and so forth.

Now it's your turn. Take a close look at Sally's sales funnels:

Salesperson: Sally Smith
Level	Target Funnel	Actual Funnel
1 - 1st Appt.	* * * * * * * *	* * * * * * *
2 - In Progress	* * * * * *	* * *
3 - Contract Out	* * * *	* * * * * * * * * * * * * *
4 - Closed Deals	* *	* *

Exercise One: Compare Sally's target vs. actual numbers, then her ratios between levels, and tell me what she needs to change. (Respond by entering a comment below.) (Note: You should do this exercise yourself before you read the comments submitted by others.)

Exercise Two: Set your Actual Sales Funnel numbers and draw your picture. Then if you need assistance analyzing what to change, just ask.

Next week we'll discuss how to get inside the heads of your prospects, so you can determine whether they're really going to buy, or whether you're spinning your wheels.

--
Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association

Measuring Your Sales Funnel

This post is Part One of a four-part series on how to accurately and objectively measure your sales funnel from your prospects' points of view. The four parts will be:

Part One: Introduction, Definition And Establishing Your Target Sales Funnel
Part Two: Measuring Your Current Sales Funnel And Determining What To Change
Part Three: Getting Inside Your Prospects' Heads
Part Four: Keeping Your Sales Manager Off Your Back

This series will be most appropriate for people who:

• Sell business to business and salesperson to buyer
• Have a multistep sales process and hardly ever close a deal in one meeting
• Have a sales cycle that usually takes four weeks or longer
• Must close one to six sales per month to hit their quotas or income goals

Each new part will be posted on Friday mornings starting today and continuing for the next four weeks. Note: You might want to subscribe (see right) to ensure you don't miss any of this series.

If you follow along and apply the concepts as I outline them:

• Your wasted time will disappear.
• Your frustration with prospects will greatly diminish.
• You will always have the answer to the question: "What should I be doing right now?"
• Your relationships with prospects and clients will be strengthened.

Definition: What Is A Sales Funnel?

For the purposes of this series, a sales funnel is defined as the period of time beginning with your first actual sales appointment with the prospect and ending when the prospect either stops buying or buys. Marketing (ads, networking, writing articles, etc.) and prospecting (cold-calls, cold-letters, drop-ins, etc.) activities happen before the sales funnel even starts, and we will not be covering how to measure those activities here (although you should measure those also).

Is The Prospect Even In Your Funnel?

While you may be selling, if your prospect is not buying, you have no chance of closing the deal, and you should stop wasting your time!

So the first question you must answer is: "Is the prospect really buying?" If the answer is "Yes," then the prospect is in your sales funnel. If the answer is "No," then you are still in the marketing or prospecting phases with this prospect, he or she is not in your funnel at all, and you should be tracking your progress with this prospect elsewhere.

Determining the answer to this question is actually quite simple, if you use this brutally objective measurement rule:

The prospect is buying only if all three of the following conditions have been met:

1. You have a firm appointment set with the prospect (meaning your name is in the prospect's calendar) at a future, specific date and time. ("Call me sometime next week" is not what we mean by a firm appointment. What we're after is more like the prospect's saying, "I'll expect your call at 2 p.m. on Tuesday, August 29." Or, perhaps, "I'll meet you at Luciano's for lunch at 11:30 Wednesday, August 30.")
2. The date of your next appointment is within 21 days of today. (For example, if you have an appointment set 22 days from today, then that prospect is not in your sales funnel. However, tomorrow when you look at your sales funnel, he or she will be in it, since it will then be only 21 days.)
3. The prospect knows it's a sales appointment, and knows he or she is the one who is buying. (Not a chat. Not a "get to know each other" meeting. Not an appointment where the prospect tries to sell you something instead.)

If these three conditions are not met, then according to our rules, the prospect is not buying and is not in your funnel at all.

Establishing Your Target Sales Funnel

To accomplish anything great, you must have a clear description of your goal. In this measurement system, you'll set a target sales funnel, then work to make your actual funnel look exactly like your target.

To determine your target sales funnel, we'll work backwards from your sales quota or personal sales goal and apply some assumptions that have been proven to be good starting points. Then, as you measure your funnel through the coming months, you can adjust your target based on your real-world results.

We're going to use four levels to establish your target sales funnel and to track your actual sales funnel. here is how we define each of those levels:

Level One: First Appointment -- This is the where you track prospects with whom you've set a first-time appointment to discuss a new sales opportunity. After the appointment, the prospect is then moved to level two, three or four, or removed from your funnel completely.

Level Two: In Progress -- This is the where you track prospects with whom you've had the first appointment but have not yet delivered a contract for signature. So if your name is in the prospect's calendar for a second, third, fourth, etc. appointment, you track that prospect here.

Level Three: Contract Out -- Once you've delivered a contract to a prospect to sign and have an appointment set for the prospect to tell you his decision, hand you the signed contract, or, possibly, start the engagement, the prospect is tracked here.

Level Four: Closed Deals -- This is the level where you track success -- the deals you've closed. In this case you won't have a future sales appointment set. So instead of tracking future sales appointments, we'll track deals that have closed within the last 30 days.

Using an asterisk to indicate a single opportunity, and a goal of two closed deals per month, a perfect sales funnel might look something like this:

L1:	*	*	*	*	*	*	*	*	8 first-time appointments set
L2:		*	*	*	*	*	*		6 next appointments set
L3:			*	*	*	*			4 contracts out -- waiting for signatures
L4:				*	*				2 deals closed in the past 30 days

To get started, set your sales funnel target by building it backwards from Level Four. To calculate your Level Four number, answer the question: "How many average sales must you close per month to meet your quota or to earn the level of income you want to earn?"

Once you have your Level Four target, do the following to set your target numbers for your remaining levels:

• Your Level Three target = Level Four x 2
• Your Level Two target = Level Four x 3
• Your Level One target = Level Four x 4

We use these numbers, because to close, for example, two sales per month, most salespeople must send out four contracts for signature. And to get to the point of delivering four contracts, most salespeople must go through the entire sales process with at least six prospects. And to get six prospects to fully engage in a sales process, most salespeople must meet for the first time with at least eight prospects. These are only averages, of course -- you will adjust your own numbers in the coming months as you track your sales funnel this way.

So, determine your target sales funnel this week, and next week, we'll get started measuring your actual sales funnel against this target.

To Change It, Start By Measuring It

About three years ago, for reasons that still escape me, I stopped getting on the bathroom scale every morning. Over the following six months, I went from 175 pounds of lean, mean cycling machine, to 200+ pounds of flab that totally demoralized me every time the cyclists with whom I ride dropped me like a rock at the bottom of the first hill.

On June 6 of this year, I finally got fed up with myself, so I started getting back on the scale every morning and recording what I weigh. (Note: That is the ONLY thing I measured.)

Here are the results of those weigh-ins:

Week 1: 204, 202, 202, 201, 200, 199, 201
Week 2: 200, 200, 200, 200, 198, 197, 196
Week 3: 196, 197, 196, 196, 196, 195, 194
Week 4: 194, 194, 194, 194. 194, 195, 193
Week 5: 193, 194, 193, 193, 192, 193, 193
Week 6: 193, 192, 192, 192, 191, 191, 191
Week 7: 191, 190, 190, 190, 189, 189, 188
Week 8: 189, 189, 188, 187, 187, 187, 188

I know as I face my food and exercise choices today, I also face the reality that tomorrow’s weigh-in will be the direct result of today’s choices. (Note: Cindy and I had pizza last night, hence the 188 this morning.)

This same measurement concept, by the way, applies to prospecting, marketing and selling. For example, to improve your sales funnel, add this one measurement to your funnel tracking:

• The prospect is in your funnel if, and only if, your name is in his calendar at a future date and time.

Look at your current sales funnel, paying particular attention to your next appointment date with each prospect. If it says "call sometime Thursday" or "touch base in a month," you may be selling, but that prospect is not buying. (When you know you don't get to count a prospect as in the funnel unless your name is in his calendar, you will naturally start asking for specific appointment dates -- and you'll start getting them.)

If you want to change something measure it objectively. Then make the choices today that will positively affect tomorrow's results.

And don't ever stop.

--
Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association

Farming The Field

Did you know that with just a swipe, that mouse or keyboard you're using to read this weekly tip can be tested to determine whether you're taking or trafficking drugs? And on top of that, the owner of the business doesn't have to get your consent to do the test, because the mouse or keyboard is his or her property, not yours.

I learned all about this last week while I was shaking hands and trading business cards at a Yellow-Tie Drinks & Handshakes networking function. And while the technology itself has nothing to do with today's tip, the conversation I had with the person who sells that technology does.

The Value Of Opportunity Not Lost

This is, I think, the smartest thing I've ever said about sales: "The wise man builds relationships and lets sales happen. The fool destroys relationships by trying to make sales happen."

This philosophy is the cornerstone of Honest Selling, and often the hardest thing to get through the heads of people who have been taught to "close the sale, no matter what."

They just don't seem to understand what lost opportunity is worth.

Salesman: "Say what? Are you telling me I should walk away from a deal I could close if I learn that the prospect would be better off not buying?"

Gill: "Yep."

Salesman: "You're nuts. "

Thinking of your own interests over your prospects' interests can often get you a sale today, but the lost opportunity cost is huge.

I Had An "Honest Selling" Moment

Adam Kreitman at Integrity Detection Systems sells hassle-free knowledge to business owners and parents. Specifically, you can use his company's testing processes to learn whether your employees or children are taking or selling drugs, without the legal or personal hassles of drawing blood or gathering urine samples, and without the delay of waiting on a lab to process your test.

I've known Adam casually for about two years. We hang out at the same networking functions, and he's read my book and has been to some of the workshops I've conducted. Last week, Adam and I shook hands at the Yellow-Tie event, and with a twinkle in his eye, he said, "I have to tell you about an ‘Honest Selling' moment I had."

Here's what Adam told me:

A few weeks ago, my partner and I were on a sales call with the executive director and president of a private school for adolescents whose needs haven't been met in the traditional classroom setting. We met to discuss DrugWipe -- a pen-sized device that detects the invisible residue of illegal narcotics that drug users and traffickers leave on the surfaces they touch.

They wanted to use DrugWipe to test for drug residue, but during the sales appointment we found the reason DrugWipe would not work for them. We can identify drug residue on any hard surface, but unless you can attribute the residue to a single person, the data is basically useless. And all of the surfaces in their school, such as lockers, are shared by several students.

After we shocked and surprised them by explaining why DrugWipe wouldn't work for their school (instead of trying to get them to buy it anyway), they asked about other options. So we examined things a bit further then offered PreScreen as a way to gain the knowledge they wanted. [PreScreen tests individuals for drug use by sampling sweat collected directly from their skin.]

Both executives loved the idea of having a portable, noninvasive test that would give them results in just a few minutes. They especially liked not having to send their samples to a lab for processing. And they quickly got excited about the technology and began talking about how and when they'd be using it.

Talk about closing the conceptual sale. Those two were describing their vision of success as though it were in the past, instead of a decision they had yet to make!

But as I listened to them discuss using PreScreen it hit me -- drugs are detectable in sweat for only about 12 hours after entering the body. That's useful for an employer who wants to find employees who are impaired on the job. But they wanted to know whether the students had been using drugs on the weekends, on vacation and that sort of thing, and wanted this knowledge for all students.

Sure, a Monday morning PreScreen would have identified the frequent users -- those who took drugs late on Sunday before school the next day -- but they wanted accurate testing for everyone, not just the worst offenders.

So I made that leap of faith you recommended: I told them why PreScreen would not work for them, and I cost myself a really nice sale.

And that's when I had my "Honest Selling" moment.

The director of the school thanked us for being completely upfront and honest. Then he did two things that made me realize what you mean by "the value of opportunity not lost":

• He told us to bring them a stack of a few hundred flyers about our home-testing products, so they could pass them out to the parents of all their students.
• In an even more generous offer, he invited us to share the school's table at the Hooked on Health Expo at America's Center in January [the conference draws about 35,000 people] for free.

Needless to say, the director didn't have to ask twice!

Adam could have closed a sale and earned a commission by keeping his mouth shut about the deficiencies of PreScreen as it applied to this prospect's situation. Instead, he sowed honesty, trust and respect, and he reaped huge opportunity as a result.

You have a field of relationships to farm.

What seed will you sow today?

What crop will you reap tomorrow?

--
Gill E. Wagner, Sage of Selling
President of Honest Selling
Founder of the Yellow-Tie International Business Development Association