Has the Complex Sale Process Changed? Are You Kidding?

Dave Stein is the author of “How Winners Sell,” and has been a long-time contributor to Expert Access. “How Winners Sell” is a step-by-step book on how to win in the complex sale.

In 2005, Dave founded the ES Research Group, which is the “Consumer Reports” of sales training and sales-training approaches and programs.

Dave is often quoted and recognized in leading magazines including: The New York Times, Business Week, Fortune and Forbes. He writes the feature monthly column for Sales and Marketing Management Magazine, and his “Commentary on Sales Leadership” blog has been featured on the website of Fox News, Reuters, Nielsen and Hoover’s.

HAS THE COMPLEX SALES PROCESS CHANGED?

Yes, a lot. The complex sale, five, eight, 10 years ago was complex and difficult enough. But now that buyers have a new tool from their perspective—a new weapon from our perspective (sales)—that is a significantly improved, enhanced and deeper internet to find out about us (vendors)—our successes, our failures, our competitors, our capabilities, our strengths, our weaknesses and our challenges—they have so much at hand.

THEY DON’T REALLY NEED US AS MUCH ANYMORE—GET OVER IT

They need less of us than they’ve ever needed before.

By the time they call us in, they are well-educated and have a good idea of who their buying preferences are. That’s important. Ten years ago, they’d have to call us to get information, speeds, feeds, features, functions, performance specifications, colors and delivery dates. But now, just a few quick touches of the keyboard and a lot of that is already available.

Things have changed a lot. Great salespeople adapt. They win. Others don’t.

THE NUMBER-ONE COMPLEX-SALE CHANGE—YOU ARE NOT IN CHARGE

The number-one change in the Complex Sales Process is that buyers are in more control now than they’ve ever been before. This all accelerated with Walmart years ago with their focus on low cost and lowest price.  I’m not in anyway judging Walmart, they’re obviously very successful. They decided that when they were in control of the sales cycle—and their suppliers and vendors were not—they were in a much better position to serve their customers.

THE SQUEEZE IS ON

So they learned very early on how to squeeze providers, how to squeeze vendors and make them abide by Walmart’s rules of purchasing and procurement.

This whole approach and concept was well-studied amongst senior executives and corporate boards in America. It evolved into, and a whole new intent and approach on strategic procurement and strategic purchasing began. When the economy tanked and Boards of Directors looked at ways that they could save money if they weren’t able to increase revenues—because there wasn’t as much money being spent—the only way to do it was to reduce expenses.

THEY NEGOTIATE FOR A LIVING

The way they decided to do that, in many cases, if it wasn’t a direct modeling of what Walmart had done, it was at least a derivative of it. We wound up with very, very strong procurement organizations within many mid-to-large-sized companies. When you think about it, these are people who have had the best consultants in the world; there are scores, if not hundreds, of programs that they take. They spend 40, 50, 60, 70 hours a week negotiating with suppliers and vendors.

AND GET PAID FOR IT

Their bonuses are based upon how much they can squeeze a vendor, even one with whom they’ve been loyal for 10 or 15 years. They also take incumbents out to bid and will do whatever is required in order to be able to squeeze that extra dollar out of a supplier.

This has put us all (all of us on that sales side) in a much, much more challenging position. Why? The average salesperson might spend 2% to 5% of their time negotiating on an average sale, but the people that they’re up against spend 100% of their time negotiating.

There are some pretty sharp firms out there now that have very effective approaches to what they’re calling strategic negotiation. So it’s not put a salesperson through a two-hour or even a half-a-day or even a full-day negotiation class once every 10 years. They build the negotiation process into the sales process so that the very first interaction that a salesperson has with his customer is a negotiation.

By the time the salesperson, on behalf of his or her selling company, reaches what would have been previously recognized as the time for negotiation—when a contract is about to be signed—that company is in a much more advantageous position than they would’ve been if they had waited until that last moment.

That’s a steep challenge for sales professionals, and it’s just one example of the way things have changed in the past decade.

HOW TO SELL IN THIS ENVIRONMENT?

How do you sell in this new, flattened, highly fluid, educated environment? Some of this is Sales 101, but either it never gets taught or it never really sinks in. It’s understanding how your customers buy. What are their:

• Buying preferences?
• Buying tendencies?
• Alternatives they may have other than you?

It may not be buying from your competitor. It may be, in the case of software (I come out of the software space myself) the biggest competitor is building it in-house.

We in sales have to understand how our buyers buy and then adapt our selling process, our messaging, our tools, everything that we do to a great extent, to match how our customers buy.

Some salespeople from the old school say:

“Well, you’re giving up, Dave. You have to assert control. You’re the one who has to tell them. You have to hold things back from them and make them come to you and all that.”

To the extent that you have any control over how your customer buys, it’s only going to be when you prove that you understand what it is they’re looking for and how they’re going to procure it. Once you build a sense of trust, then they will listen to you, but not until then. I think that’s a big point that a lot of sellers are missing these days.

HOW SHOULD SALESPEOPLE EDUCATE THEMSELVES TO COMPETE?

A salesperson, especially a beginning salesperson, if they can understand it’s all about:

• The  money
• The customer achieving their business goals and objectives
• Understanding what those business goals and objectives are
• Positioning your product and service so that the customer can see without a question of doubt how your product and service will help them achieve their business goals and objectives in financial terms

That’s when the real sale begins in earnest. Not until then.

But if a salesperson is trying to sell based upon:

• The shininess of their product
• The reputation of their best lead consultant
• The fact that their CEO appeared on the cover of Forbes magazine …

… that may get them some attention, which is incredibly important, but it’s going to be very difficult to actually get the sale.

When the salesperson makes the transition to proactive business person, that’s when they start to win business in the complex sale.

Remember, you’re not selling things to companies because they want to buy things—because they like things. We do that as consumers. We want a new barbecue grill. I’m buying my first motorcycle in a couple of weeks, and I’m excited about it. We as consumers like to buy things for the emotional kick of it very often. But businesses don’t buy things just for the sake of buying; they buy  products or services from vendors or suppliers because they want to improve their business. They want to either increase revenues, decrease expenses, both, or somehow mitigate risks.

HOW DO WINNERS SELL?

The number-one thing great salespeople and sales teams do is sell value. To do that, you have to be able to quantify value for the prospective customer.

If you subscribe to the approach I suggest, and that it’s about salespeople being businesspeople and companies buying from you when you can clearly and compellingly explain how your product or service will impact their business, the obvious hurdle is:

• How do you put that in financial terms?

This is a little bit like the chicken and the egg. The reason is that many companies will not share with you their internals about how an inventory department is running—or a logistics organization, or a marketing organization or whoever you’re selling into. They will certainly not do that early on.

If you have not sold, installed and implemented your product or service in other companies, if this is the first company your firm has ever gone to, you don’t have anything to fall back upon and use as a proof-of-value statement. But assuming that you’re not new, most organizations can go back to existing customers and benchmark in reverse a retroactive or retrograde benchmark.

That is …

“Can we get some idea of where you guys were before we arrived on the scene? Let’s take a look at where you are now. Let’s measure the improvement in X different functional areas and put some numerical dollars, hopefully, but if not, a relative percent value on it. By the way, can I use your company’s name and your name, Mr. or Ms. CFO, in my marketing efforts?”

Now, it may be one out of 10 companies that will let you do that—maybe three out of 10. We’ve been very lucky at ESR. Most everybody we have ever done a project for is willing to share that information. So now I benchmark our performance within different industries. If I’m selling into different industries like transportation, technology, professional services or medical equipment, then for each of those industries, I can either communicate it in a very clear, concise and compelling way or document in writing the kind of improvement that our customers have enjoyed with the use or implementation of our products.

If I say:

“Joe Kayser at MegaMind Company used our product for five years. When he first used it, he was able to achieve pitifully poor results that he thought at the time were great.  But after using it for five years, he’s at this new, vastly improved level. You can talk to Joe if you would like to, and once you’ve done that, I would like to sit down with you and talk about the potential improvement your organization may get from my product or service.”

It’s gathering that information and having it at your fingertips and in your back pocket that often opens up the doors to allow your customer to share information with you.

It’s also the way that this quantified business-value sale is modeled.

Is it easy?

No.

If it were, it wouldn’t be sales.

And the Complex Sale is sales on steroids.