Tuesday 19 May 2009
Sales Therapy®: How to increase sales in a downturn
Lewis Media Centre, London
Grant Leboff doesn’t look old enough to have founded two highly successful companies. He has the appearance of a late-twenty-something who, with unkempt, shoulder-length hair, would rather be taking to the stage as a lead singer in a rock band than as a business entrepreneur and speaker. Indeed as he began his address to the London Business Forum you could sense an air of scepticism, as Sales Executives, Directors and MDs alike wondered what this young upstart had to offer. However, it didn’t take long until they got their answer – an insightful and considered guide to selling.
Leboff began by setting the scene: the invention of the internet has seen the world change at an unprecedented rate over the past 20 years. To illustrate the power of the internet Leboff cited President Obama’s inauguration ceremony during which CNN and Facebook registered more than 4,000 posts per minute from people watching around the globe. Never before has the world seen such a communication tool, and things will never be the same again.
“So, why?” Leboff challenged his audience, “…did Yellow Pages not become Google?” At the conception of the internet, Yellow Pages was the primary tool for finding individuals and companies. Yet, in much the same way as Loot being overtaken by ebay, they failed to recognise the immense potential of the internet. “The Point? That there are thousands of companies that still don’t get it”
In the modern world, if we want something most of us use only two methods:
- ask a network (friends, colleagues, family etc.)
- go online
“Therefore, are these the only two things that matter in marketing?” Leboff postulated. A mistake most companies make is that they rely on passive word of mouth. However, “Here’s a challenge: how do you build active word of mouth into your strategy?” The template example of this is Facebook, which actively drives customers to invite friends to join. In this way, membership and marketing becomes viral. Leboff exclaimed “Your greatest sales people are not you! They are your customers.”
With initial scepticism allayed, and the audience eager for further insight, Leboff moved to the crux of his presentation: the problem with the current sales model, and his solution – Sales Therapy®.
In the current communication revolution the traditional sales and marketing model is broken. The funnel approach of contacting vast numbers of customers (through methods such as telesales or direct mail) – this being the wide top of the funnel - and then making profit through the number of successful leads you’re left with at the significantly narrower bottom end, no longer works. “It’s a fact”, claimed Leboff, “…that direct mail response rates are going down and sales call success rates have plummeted.” Unlike 20 years ago when many households kept a drawer full of pamphlets, we no longer need to look at, or keep, direct mail, We now know that when we need something we can simply Google it. “The funnel model is broken” claimed Leboff. “But, more importantly, we don’t know what to replace it with.”
“You need to take the funnel and turn it upside down.” In this way, you have a very narrow top. Then, once carefully targeted prospects come in, it becomes wider and wider as they go down - your customer journey. So long as you ensure this journey is a positive one, you actively drive word of mouth. This model is fundamentally different from the one it’s replacing: it’s a transactional model. With this in mind, the key questions you should be asking as part of your customer engagement strategy are:
- How do you get customers in?
- How do you keep them there?
We’ve been told to sell on benefits, claimed Leboff, but this doesn’t work until your customers are actually interested in buying. Therefore, the beginning of customer engagement is giving value. You’ve got to understand buyer motivation but you’ll never do this by selling benefits; rather, it’s by solving a problem a client has (e.g. a customer buys a Jaguar because it solves the problem of social status, rather than simply as a means of getting from A to B).
Forget USP… think of CEP
Leboff then debunked the USP, claiming that in the communication revolution this is no longer valid, because:
- nothing is unique anymore (even patents get copied with very minor adjustments)
- It works when selling products or services but we no longer do so. We’re now an experience based economy.
In place of the USP we should now be using CEP – Customer Engagement Points. To illustrate, Leboff cited an example of a Saab dealership who brought in his expertise after experiencing a slump in sales. His solution was to produce a unique experience for the customer. To do so, they installed coffee machines, brought in freshly baked pastries, and offered free wi-fi and hot-desking for local businesspeople. The approach was never about cars – it was about footfall, yet they subsequently noticed a marked increase in sales. “The funnel is tactical – it’s a long-stem strategy” claimed Leboff.
- To develop CEP Leboff argues that you need to undertake the following steps:
- Establish Partnerships: who can you partner with who will help you reach your target market?
- Content: Produce targeted materials that are coherent across your media (website, newsletters, flyers etc.) and that provide value in their own right.
- Create a clear market position.
- Understand emotionally what you’re going to deliver. Do you sell candles or romance? Burgers or family entertainment?