peterosborn.com

You know how it feels: great meetings, the customers love what you do, they get it alright, but something always seems to happen to cause a delay in getting the order. The frequent response of technology companies is to increase the value of the proposition, to extend the functionality, to enable it to do more stuff, but this doesn't seem to make sales happen any faster. You're still having great meetings, and the customers are really fired up while you're there. What's wrong, for heaven's sake?

It seems to be a common problem, particularly among technology based businesses: the paradox that lots of people are wowed by what the technology can do, but few seem to buy. The problem often gets misinterpreted, too: we need more people to like what we can do, we need to be able to do even more.

The problem is not that the customer doesn't like the proposition or see the value. The difficulty is that other, more urgent things get a higher priority. "What you've got is really good and we're going to implement it, but we've got this big project/problem/initiative underway. As soon as that's completed we'll be in touch to get things moving with you."

The answer lies in a careful understanding of the customer's business, to identify how you can create the imperative that gets you the attention of the decision-makers. You have to find the hook for your proposition, the thing the customer can only do once he's bought and implemented your proposition: The Compelling Event, as it's known.

Sometimes, these imperatives come from outside the customer's business. A change of the regulations, would be one example. Another might be a change in the requirements of your customer's customers, or a different set of competitive pressures. These market changes can bring pressure to bear on your customers, but they can change the psychology, too. The watch point is that these external pressures on your customers can make you his grudge purchase. Who really enjoys buying car insurance? You will need careful marketing messages and positioning, if your customer is buying because he has to.

Far better to be mission critical, to deliver something that unlocks a market or enables your customer to achieve the things that are high on his list of priorities. Of course, you will need to know what these are, but questioning and listening are what Sales is all about: telling isn't selling!

When sales don't happen, many companies make the mistake of adding even more value, in the hope that this will make the difference. After all, an even better mousetrap will bring even more people to our door. Possibly, but unlikely. What is more likely to happen is that even more stakeholders get interested, and there is an even larger number of ways the proposition can benefit your customer, but this creates two problems that add more delay. Firstly, the wider interest creates a diffusion of responsibility, and a confusion about who's going to make the decision. If separate budget holders are involved, this turns into the problem of who will take the cost: one budget holder doesn't want to use his resources for someone else's benefit.

The second problem arising from even more value, is that the implications become wider, and the customer ends up in paralysis over how to implement.  It can be very hazardous to become a "strategic purchase", because the order you want to secure can get mired in your customer's long-range thinking and planning, and group decisions. Much better to be a smaller but important deliverable for one decision-maker, one budget holder.

It might be that your proposition is already too extensive to be bought easily, and you need to break it apart into simpler, more stand-alone and targeted components that give the customer more discrete options, and you a shorter, more easily controlled sales cycle.

One way or another, you have to find the things that trigger the customer to act. Value can be one of these, but it's rarely a trigger on its own. Reducing costs is something everyone wants to do all the time, but rarely something that must be done before the end of the month. Value justifies the price-tag, but it's urgency that gets the signature on the purchase order.

(c) 2010, 2011 Peter G. Osborn