David Hoffeld had been an extremely successful salesperson for many years, rising to VP positions where he imparted his knowledge to his sales teams, who in turn were successful themselves. He was confident in his sales technique—and had the awards and financial success to show for it.
Because of his success, he’d never questioned his approach—until he and a colleague with a similarly successful background clashed over their respective techniques. Suddenly, what Hoffeld had seen as a carefully honed method of rapport-building was being denounced as a gimmick. Irked, he defended his corner, putting the case for his own approach that had worked throughout the years.
Then a question from his colleague stopped him in his tracks: 'How do you know that the approach you are using is the reason for your success?' Hoffeld was dumbfounded.
'I realized I [had] made a lot of assumptions about the best way to sell based on my personal experience. None of it had been scientifically proven,' he said.
For Hoffeld, the question was so profound that it led him to study for six years at Harvard, where he sought to better understand why a particular sales technique is good or bad. The benefits of his education were clear: 'Once you are educated, adopt the practices. When I did I watched my company’s average win rates move from 20 to 71%. Our prices doubled at the same time. And our sales cycles shrank. What sales rep doesn’t want that?'
Hoffeld’s story shows how the use of scientifically proven sales techniques can have a huge effect on the wellbeing of your business. Here, we’ll look at seven techniques that have been empirically shown to be successful. Perhaps they will illuminate where you are going wrong—or help you understand exactly why certain things are working.
Technique 1: Respond Quickly
The results of a recent Harvard study show that companies that tried to contact potential customers within an hour of receiving a query, were almost seven times as likely to qualify the lead (defined as having a conversation with a key decision-maker) as companies that waited even an hour longer to make contact—and 60 times as likely as companies that waited 24 hours or more.
Another 2011 study by Harvard showed that, despite their research, companies across the U.S. were consistently failing to follow up on leads quickly enough. Of a sample of 2,241 companies, 63% failed to respond within the first hour, with 23% not responding at all.
Harvard found there were various reasons for this, including companies retrieving leads daily rather than continuously and restrictive rules on distribution of leads among agents and partners. They conclude their report with the pertinent question: 'Companies are making big investments in order to obtain customer queries from the Internet, and they should be responding at Internet speed. Why aren’t they?'
Make sure that your retrieval and distribution of leads allows the quick response time that as scientifically proven to contribute to more sales.
Technique 2: Start Off Small
If you want a customer to agree to a big request, start off small. Those were the findings of Jonathan L. Freedman and Scott C. Fraser, whose Compliance Without Pressure: The Foot-In-The-Door Technique details an experiment they conducted in a small neighbourhood.
Freedman and Fraser asked people to put up a large, ugly sign outside their home saying 'Drive Carefully'. At first, less than 20% of people said yes. However, Freedman and Fraser found that, if they first asked residents to put up a smaller sign in their front window and then subsequently asked them to install the larger sign outside, a whopping 76% of people would agree to the larger sign.
The findings show that starting off with a small request will make the customer more likely to agree to a bigger request later on. People who had agreed to put up the first sign felt involved in something and more of a connection with the researchers, making the idea of the big, ugly sign more palatable.
A relationship of trust had been established between the researchers and the residents that all came from the initial small request. To find out what your small requests should be, you need to first identify your big question—what do we want the customer to buy? Work backwards from there and find the small questions that are going to lead you to your ultimate goal.
Technique 3: Create A Modern Account Strategy
Account strategy was traditionally about having a rigid account management process that applied across all clients. Regardless of their differences, all clients would be fitted into this account strategy.
Matthew McDarby of SmartCEO argues that this approach is out of date in the Internet age. 'Account strategy today is all about the seller having a certain way of thinking about how things work in the buyer’s organisation, rather than simply fitting that customer into a structured process.'
Simply put, it’s about thinking about the client rather than thinking about yourself. Based on SmartCEO’s research, McDarby found that salespeople who followed the older model performed averagely. Salespeople who excelled were those who had properly researched the customer, had worked out the impact of decisions on their company as a whole, and were able to challenge ideas and offer solutions.
Technique 4: Set Up False Comparisons
In his book The Power Of Persuasion: How We’re Bought And Sold, Robert Levine, a professor of social psychology at California State University, recounts the tale of how he impersonated a used-car salesman in the early 2000s.
Levine was worried that he wouldn’t be able to sell many cars because he couldn’t retain the information about the various different models. He soon worked out that he didn’t have to do this—all he had to do was to show the cars in a specific order.
The hierarchy of prices led the customer to make assumptions about what was good value and what wasn’t, despite the fact that the only basis for comparison was the cars on the lot itself. It’s the 'base rate fallacy'—when a customer isn’t aware of the market value of a product, they will establish for themselves a base rate based upon the choice they have in front of them.
Levine puts it like this: 'If a bunch of $200 espresso machines are sitting next to one overpriced $400 espresso machine that does basically the same thing, the $200 machines suddenly look like an obvious good deal. This especially true if you have a skilled salesperson who divulges that the $400 machine isn’t really better than any of the others.'
It’s simple psychology, but it’s proven to work.
Technique 5: Embrace Social Media
It can be a tough mistress, but social media has been proven to drive sales. In a 2012 survey, social sales specialist Jim Keenan found that 78.6% of salespeople using social media to sell outperformed those who hadn’t. The figure was so staggeringly high even Keenan wasn’t expecting it.
The numbers keep on coming: Keenan found that social-media salespeople were 23% more successful at exceeding sales quota than those who had followed more traditional methods. 54% of respondents to the survey who used social media attributed at least one closed deal to their social-media usage; over 40% attributed between two to five deals to social media.
One of the fears among employers is that reps using social media will spend too much time on social sites at the expense of other aspects of their job, but Keenan’s report dispels this notion: 50.1% of social-media users said they spent less than 10% of their selling time using social media.
In Keenan’s Forbes piece, ‘The Rise Of The Social Salespeople,’ he argues that he’s 'ushering salespeople from the old world into the social world,' away from cold calling and towards educating customers via Twitter and LinkedIn. However, 75% of those surveyed in 2012 said they’d had no formal social media sales training from their company.
Make sure your company isn’t slow to embrace the power of social media—the stats are there to back its worth.
Technique 6: Recognize Social Similarities
Humans tend to be rather narcissistic — we’re more likely to trust and like people who we perceive to be like us, even if those characteristics are purely superficial.
An experiment carried out by Jerry Burger, a professor at Santa Clara University in California, involved undergraduate students being asked to take part in what they thought was an astrology study, where a research assistant would sit among the students posing as a participant. Over the course of the experiment, one of the students would discover they apparently had the same birthday as the masquerading research assistant.
The research assistant would later ask that student to reply with a request to critique an eight-page paper. Burger and his team found that participants who thought they and the research assistant shared a birthday were twice as likely to agree to the request.
A second study by Burger involved a woman requesting donations for a charity. The woman wore a nametag. If the charity worker had the same name as the participant, the participant would donate on average twice as much money as participants who did not have that name.
So if you’re a rep, make sure you’re asking questions of your customer and trying to find areas of similarity. Science has shown that they will be far more amenable to parting with their money if they see something of themselves in you.
Technique 7: Create A Feeling Of Scarcity
People don’t like to be left out. If we feel that a product is going to be sold out and our chance to own it will be taken away, we’re more likely to make the purchase than if we feel that item is in abundance.
Colleen Szot is a hugely successful American infomercial writer. Looking to create a feeling of high demand in her infomercials, she famously changed the call to action that appeared on screen. 'Operators are waiting, please call now!' became 'If operators are busy, please call again.'
In doing so, Szot changed the image of the call operators in our minds. Instead of the idea of bored, slumped figures waiting for the phone to ring conjured by 'operators are waiting,' we now have an image of operators barely able to stop for breath as they take call after call.
Szot was playing on something called 'social proof,' which is the idea that we look for validation from others before making our decisions. Her subtle change meant that the product seemed in high demand—and if other people want it, then I want it too.
Jerry Burger and his colleague David Caldwell further demonstrated this principle in a study in which participants were asked to evaluate products commonly sold on US college campuses, one of which was an insulated travel mug. With the study apparently at an end, researchers told the participants that the mugs were on sale at a reduced price.
Some of the participants were simply encouraged to hand over money for a mug, while others were informed that the mugs were in limited supply and that they could only buy one if they drew a lucky ticket from a hat. All of the tickets were in fact marked with a symbol that entitled the participant to a mug. Burger and Caldwell found that, of the two groups, the 'winners' of the fake lottery were more likely to offer to purchase a mug because they felt they had a limited opportunity to do so.
Perhaps you knew some of these techniques already, or perhaps you’ve been using them without knowing it. Hopefully, one or two of them have educated you on why a particular practice succeeds or fails. Now you can go and apply the techniques that best fit you and your company, and be able to back up your approach by citing its scientific merit.
As David Hoffeld said: 'Once you are educated, adopt the practices.'
About the AuthorMore Content by Geoffrey Walters