The Dangling Insult
We would never insult a customer by suggesting he is incompetent or imply to an executive that she is negligent, yet it’s a common occurrence and salespeople unknowingly insult prospects every day.

For example, a salesperson introduces his solution by saying, “We save companies like yours from wasting hundreds of thousands of dollars in lost ….” It sounds innocuous on the surface. Statements like this are standard sales-speak and are often true, but they also contain dangling insults. If you tell a customer she is wasting money, aren’t you also suggesting that she hasn’t been doing her job very well?

Dangling insults are unintentional. Salespeople are unaware of their negative impact because they are built into their mindsets and the conventional sales training they received. The salesperson thinks he is delivering a compelling message and connecting to the customer’s pain. But to customers, it can sound like salespeople are interjecting or ending sentences with, “…you idiot, sir.”

At times, you can tell when customers hear a dangling insult because they react physically. They lean back in their chairs, cross their arms and scowl. They often react verbally by saying something like: “We’re not losing anywhere near that much money.”

Most of the time the reaction isn’t that obvious and most salespeople don’t realize they’ve insulted the customer. As a result, they misinterpret the customer’s reactions and can’t properly address them. In fact, salespeople’s natural response patterns often make matters worse.

The Old Brain
The manner in which salespeople react to customers’ responses can open the path to honest communication or become a primary instrument of self-sabotage. There are two parts of the brain that are particularly problematic in sales situations: the brain stem and the limbic system, which scientists define as the “old brain.” The brain stem, or “reptilian brain,” controls our involuntary actions and the limbic system generates basic emotions, such as fear and aggression. The old brain is not big on interpretation and analysis. It reacts to situations with lightning speed in six ways: attack, submit, flee, reproduce, nurture or be nurtured.

So how does the old brain affect sales conversations? Continuing the example above, when a customer says, “We’re not losing anywhere near that much money,” a salesperson might counter with, “I’m sorry, but I think you misunderstood….” This implies that the customer just doesn’t get it and often triggers an even more irritated retort. The salesperson is unconsciously engaged in self-protection at the expense of the customer, who will often protect his self-esteem and strike back in turn.

Stopping Self-Sabotage
How can we stop sabotaging our efforts? The first step is awareness. The second step is to stop behaving like a salesperson and start behaving more like someone keeping customers’ best interests in mind.

A good example is that of a doctor diagnosing a patient. During a diagnostic conversation, the full extent of the patient’s problem is explored, measured, evaluated and communicated. Likewise, if you examine your customers’ situations, you should focus on the physical symptoms of the problems they are experiencing. The goal is to raise customers’ awareness and understanding of their problems and what it is costing them to manage the services you would provide.

When we’re in the diagnostic mode, we’re dealing directly with our customers’ reality. That is, we are working with situations they have experienced in the past, are currently experiencing or those they believe they will be exposed to in the future. In fact, our customers may not be aware that these symptoms could represent significant problems that should be addressed. Through diagnosis we can help bring clarity to problems and a way to make quality business decisions.

The challenge for businesses today is to equip sales professionals to be more diagnostic in their conversations. There are three primary objectives to keep in mind during “diagnostic conversations”:

1. Uncover the reality of the customer’s situation (do these symptoms exist?).

2. Quantify the impact of the problem (how bad is it?).

3. Create the “incentive to change” (is it serious enough to take action?).

Increasing Diagnostic Capabilities
To increase your diagnostic capabilities through support materials, consider these three steps:

1. Include diagnostic tools in your marketing communications to help customers develop clarity around the issues you address. Consider a “Seven Early Warning Signals” brochure to help customers recognize the absence of the value your solution can provide.

2. To create more qualified prospects through your website, guide customers through an initial diagnosis that will help them recognize the inefficiencies of their current approach.

3. Make sure product training teaches your salespeople the symptoms of problems your solution is meant to solve and how to quantify the impact of those problems on your customers’ business.

A quality diagnosis builds trust and credibility and creates a patient who is ready to take action. In business it means greater differentiation and clarity, customers that respect and trust us and more sales with profitable results. 

Jeff Thull is President and CEO of Prime Resource Group and a thought leader in sales and marketing strategies for companies involved in complex sales. Thull is a compelling keynote speaker and best-selling author of Mastering the Complex Sale, The Prime Solution and Exceptional Selling. To download Chapter One of Thull’s books visit www.primeresource.com 

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T R E N D S

Trumpeting ‘buy local’ to beat recession 

While the buy-local movement isn’t new, some small business owners are saying buy-local efforts have helped insulate them from the worst of the downturn. According to a national survey by the nonprofit Institute for Local Self-Reliance in Minneapolis, independent retailers in cities with buy-local campaigns saw holiday sales fall only 3.2% from the prior year, while those in cities with no such movements recorded a 5.6% drop.

Most successful buy-local campaigns grow out of independent business networks that share three main elements, says Jeff Milchen, who in 1998 co-founded the first such group in Boulder, Colo. First, they educate consumers about the value of independent businesses in the community. Second, they jointly promote shopping at those businesses through advertising, coupon books, shop-local weeks and other efforts. And third, they give independent owners a unified voice in government and media.

At least 130 such groups have been founded since 1998, with the number roughly doubling since 2005. The trend has been bolstered by growing consumer interest in buying locally grown food and reducing carbon emissions associated with shipping goods long distances. 

Source: BusinessWeek, February 27, 2009 

Small businesses face more fraud in downturn 

Cash-squeezed small businesses are facing another threat in this struggling economy: rising employee fraud.

Fraud tends to rise during tough economic times, when workers are feeling financial pressure, experts say. Small companies are especially vulnerable because they often lack stringent internal controls to prevent fraud. Sometimes, managers at affected companies attribute lost funds to lower sales. Some may even have to close their doors, never suspecting foul play.

The most common methods of fraud at small businesses are billing schemes, which occurred in 28.7% of cases, and check tampering, 25.4%, according to the Association of Certified Fraud Examiners.

Fraud is most often committed in the accounting department or upper management. Owners must strike a balance between delegation of financial duties and maintaining a certain level of control.

Once a business owner discovers any alleged fraud, he or she should keep quiet while recruiting help from an accountant and lawyer. Most perpetrators will agree to strike a deal to avoid prosecution. 

Sources: The Wall Street Journal, February 19, 2009; 2008 Report to the Nation on Occupational Fraud and Abuse 

Profiting from the ‘eco-bounty’ 

Although financial woes may hold back some green initiatives, the future has never looked greener. Four out of five people say they are still buying green products and services today, which sometimes cost more.

Trend analysts at Trendwatching.com have identified a movement coined “Eco-Bounty,” referring to the opportunities for companies participating in the quest for a sustainable society. Here are eco sub-trends that entrepreneurs can act on now.

Eco-frugal: All things eco are being repositioned from “worthy but expensive” to “cheap and, oh yes, worthy.” BMW is repositioning the Mini as not only fun-loving, but cheaper to run and eco-friendlier.

Eco-feeders: These are small start-ups that feed off big eco players. Luscious Garage is the first woman-owned and operated autoshop in San Francisco servicing hybrids with a specialty in converting them to all-electrical plug-ins. They attract customers seeking a friendlier car repair experience with the garage’s laid-back décor featuring plants and books.

Econcierges: These are services dedicated to helping households go green, potentially leading to big savings. New York-based Green Irene offers eco-makeovers for $99, which involves a visit from an eco-consultant who will assess the home and provide a personalized set of recommendations for saving money, energy and water. If the customer chooses to make those changes, they can purchase solutions from Green Irene. 

Source: Trendwatching.com, March 2009 

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N E W S

Pumping money into small biz 

President Obama recently vowed to ease the financial plight of the nation’s small businesses, which have been hit hard by the recession. In the last three months of 2008, banks made 57% fewer loans through the Small Business Administration’s main lending program than they did a year earlier.

The President highlighted various initiatives the administration is working on to boost those grim numbers. The stimulus bill allocated $730 million for direct spending on small business programs, including expanded financial support for the SBA’s two key lending initiatives, the 7(a) and 504 programs. The SBA will temporarily guarantee up to 90% of qualifying loans, up from 85%, and will waive or reduce the fees it charges banks and borrowers for participation in the program.

The Treasury Department also announced that it is making progress on steps to thaw the frozen secondary market through which many banks sell bundles of their SBA-backed small business loans. To restart that secondary market, the Treasury Department plans to spend up to $15 billion buying those securities bundles directly from banks.

The small business initiative that should most directly help struggling small business owners is a new “business stabilization loan” program that will back bank loans of up to $35,000 for business owners who are having trouble keeping up with payments on previous loans. The fresh cash infusion is intended to free up money that business owners can then use to pay their bills and their employees.  

Sources: CNNMoney.com, March 16, 2009 

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T I P S

• Wonder why your competitor gets interviewed on hot topics that you could have been interviewed on? What your competitor may know is the art of piggybacking. Piggybacking is a term used to tie in your expertise, product or service into a current event. When a current event happens, reporters need to cover it — and they are always looking for someone to interview about it. Current events are usually dead within a few days. So once you think of a tie-in, you need to pitch journalists right away. Your best bet is to call each reporter and say, “I notice that x is happening; I have some additional information on the topic of x that may be of interest to your viewers/listeners/readers. And I am available for interview today.”

Source: www.cherrycommunications.com

• Turn customers’ frequently asked questions into a blog. It’s an easy way to break into the blogosphere and gives people a reason to keep coming back to your website. Dentist Ellie Philips was constantly being asked similar questions by patients. So she turned those questions into fodder for a blog called “Ask Dr. Ellie.” The blog positions her as an expert and it creates fresh content that improves her search engine rankings.

Source: www.contentmarketingtoday.com

• Are you taking full advantage of your case studies and white papers? One case study, for example, can serve as: spider-food on your website that boosts search engine optimization and provides meaningful content; a direct mail insert in lieu of the traditional product brochure; a tradeshow handout to jump-start conversations; or a leave-behind for sales calls. If your white paper is genuinely valuable, and not just promotional swill, you may be able to pick up some press by trade magazines or bloggers.

Source: www.marketingprofs.com

• Encourage customers to pay on time by creating a reward-and-punishment billing system. First, the carrot: Offer a discount if a client pays the debt early. The most common early payment discount is called the “2/10 net 30 rule”: Customers receive a 2% discount on a bill that is due in 30 days if they pay by the 10th day. Now the stick: If customers face a mountain of unpaid bills and invoices, they need a good reason to pay your company first. Customers are more likely to cough up the cash if they know they will legally owe more money down the line. To encourage payment, start charging accrued interest on the day the bill is late. Include a clause in the service agreement or contract that says the client is responsible for all fees associated with bill collection. Finally, consider requiring the business owner or principal to sign a personal guarantee.

Source: www.bnet.com

• Three ways to boost revenue in a recession. First, tell your sales team to develop a list of 50+ top prospects they gave up on. Reconnecting now can pay big dividends, especially if those prospects’ suppliers are having problems. Second, keep nurturing leads. Historically, 30% of prospects buy over time when nurtured consistently, says research by eti, a customer acquisition services company. Third, keep an eye on the competition. If a rival drops a product or service, odds are they’ll be losing some customers. That’s demand your company can scoop up.

Source: The Marketing Report, 370 Technology Dr., Malvern, PA 19355

• Considering layoffs as a way to make ends meet? Not so fast. Studies show that layoffs stunt the productivity of remaining employees due to low morale. Consider these alternatives: cut hours — when given a choice, many employees would rather work less than see themselves or colleagues let go; cut wages or benefits — it’s always better received if senior management takes a cut first; ask for volunteers — you may have an employee who would like the opportunity to leave with a little financial incentive to do so; and start with weak performers — chances are, others know they’re weak and it’s already hurting office morale, so if cuts are inevitable, start there.

Source: Independent Street, www.wsj.com

• If you had a net operating loss in 2008, a new IRS provision allows small businesses to elect to offset this loss against income earned in up to five prior years, rather than the typical two years, allowing these business owners to receive a tax refund. For losses in tax years beginning or ending in 2008, small businesses can opt for a three-, four- or five-year carryback period. Losses not used up via carrybacks can be forwarded for up to 20 years. To qualify for a longer carryback period, the business’s average annual gross receipts for the three prior years must be under $15 million. Contact your accountant for further details.

Source: bizbox.slate.com

• Productive “gripe sessions” can improve morale. When your entire staff seems unhappy, provide a forum for them to vent their frustrations productively. Ask them to “tell it like it is.” You want them to talk to you, not behind your back, so don’t be defensive when they gripe or criticize. Promise that there will be no repercussions — that you just want to learn about the problem. To keep the session from becoming a free-for-all, pose clear questions, such as “What’s gone wrong since we installed the new system?” Pledge that you’ll get back to them within 48 hours with a response to the issues.

Source: Manager’s Edge, 2807 N. Parham Rd., Richmond, VA 23294

• Get more out of local search. If your business serves multiple neighborhoods or towns where you lack a physical location, consider the following: develop a array of location-specific content on your website to show search engines you serve those areas; get a P.O. box and local phone number in the extra locations you serve; claim your profile on local portals that only require a business name and phone number, or that accept P.O. boxes. These steps will make sure Google Maps adds your additional “locations” to its web crawl, at which point you can claim them as local business listings.