Marketing Strategic Planning

If selling were simply a process of understanding our customer’s goals and objectives and then coming up with a way to help them achieve them, then we would win every sales opportunity we engage in, wouldn’t we? Unfortunately, there are a few other factors involved. Customers don’t pursue every ‘C’ they can imagine because they don’t have enough time and money to achieve them all. They have to choose among the available options by assessing which are the best ones to pursue right now. Now let’s take a closer look at some of the variables or criteria used in that valuation process.

To position our ‘B’ (our product and services solutions) in the best possible light, we have to understand not only what our customer’s ‘C’ is, but also the conditions and the drivers that surround their desire to leave ‘A’ and move toward ‘C.’ I like to refer to these conditions as ‘Action Drivers.’ There are six of them as follows:

• Their motive for leaving ‘A’ and moving toward ‘C’
• The urgency to arrive at ‘C’
• The payback or return they expect when they reach ‘C’
• The consequences for staying at ‘A’
• Their available resources or their means to make the trip to ‘C’
• The perceived risks involved in leaving ‘A’ or moving toward ‘C’

Understanding these Action Drivers, and the degree to which your customer feels them, isn’t as complicated as it might sound. It’s really just asking more of the right questions. Next, we will go through the six Action Drivers offering sample questions to better understand each one.

When you are meeting face to face with your prospective client, or even while you are conducting research ahead of time, be on the lookout for the presence of these Action Drivers. When you find a customer who has a desired point ‘C’ and is driven by these six Action Drivers to arrive there, then you’ve got a real opportunity on your hands. If you can get your prospect to start talking about his goals and objectives, all you have to do is remember to ask some variation of the questions that relate to the six Action Drivers.

I’m not so worried about the structure of your questions (open-ended, closed-ended, either/or, etc.), as much as with the substance of your questions. By asking these questions, you are asking about the things that really drive buyer behavior and enable you to better under- stand the quality of the sales opportunity at hand.

These drivers could be strictly business related, personal, or both. There could very well be a business motive and a personal motive, a business urgency and a personal urgency, as well as a business risk and a personal risk at play. A chief information officer (CIO), for example, may recognize a strong business motive to outsource as many IT functions as possible, in order to contain or cut costs. But she could also perceive outsourcing to be a personal risk because a smaller in-house IT staff means a smaller budget and perhaps less need for a CIO. If we listen closely and ask the right questions, we’ll hear both personal drivers and business drivers that affect any individual’s judgment and decision-making process.

1. Motive

Once your client acknowledges a need, problem, pain, obstacle, or some other description of the disparity that exists at point ‘A,’ and has also expressed an interest in moving toward a desired point ‘C,’ the most important question we should be asking ourselves is, ‘Why would they do this?’ There is no single question that is more important in our quest to understand and qualify any sales opportunity.

Remember, reaching point ‘C’ will require time, attention, and resources on your customer’s part. And if it requires passing through ‘B’ on the way and giving us some money as they go by, they’re going to need a good reason to do it. I think it’s safe to assume that . . .

If your customer can get from ‘A’ to ‘C’ without you, they probably will.

We want to know, as early on as possible, what would motivate our customer to hand us a large sum of money and then spend months and maybe even years implementing whatever solution we sold them. If they don’t have a strong enough motive to leave the perceived safety of the status quo and venture into the unknown in search of a better reality, they might just choose to stay at point ‘A.’ To understand Motive, we need to ask, ‘Why . . . ?’

• ‘Why is this desired outcome so important to you right now?’
• ‘Why would achieving this objective be of value?’
• ‘Why does this disparity you’ve discovered constitute a problem?’
• ‘Why does this disparity exist?’
• ‘Why haven’t you done something about it before?’
• ‘Why would you invest money to solve this problem rather than investing that money to address some of the other needs that the company has?’
• ‘Why couldn’t you let someone else in the company worry about solving this problem?’
• ‘Why not just ‘do nothing’ and hope it works itself out on its own?’

2. Urgency

Just because a project or a new initiative is worth pursuing doesn’t mean your customer has to act on it now. Even the biggest companies have limits on available resources. Priority is often determined more by urgency than by long-term importance or significance. Urgent problems have a way of siphoning resources away from more important projects and initiatives that don’t pose as great of a short-term threat.

A lack of buyer urgency is one of the most troublesome issues that sales professionals deal with. Therefore, begin as early as possible asking your customer questions to determine or establish their level of urgency. These questions begin with ‘When . . . ?’

• ‘When would you like to reach this goal you have defined?’
• ‘When did you discover this obstacle to achieving your goal?’
• ‘When did you decide something needed to be done?’
• ‘When will this medium-size problem become a big problem?’
• ‘When do you think you need to take action to solve this problem?’
• ‘When does this project need to be underway?’
• ‘When would you like to start seeing results?’

Buyer urgency is often overlooked early in sales campaigns. Our assumption is that once they see and hear how great our solutions are, they will want to hurry up and buy them. Don’t fall for this. Without an urgency that is driven by their desire to reach point ‘C,’ the sales opportunity can easily slip from one month to the next, one quarter to the next, and even one year to the next, indefinitely.

No amount of customer enthusiasm for, or interest in, your ‘B’ can make up for a lack of urgency to reach ‘C.’ Some other project or some other initiative that demands more urgent attention can easily come along and steal away those highly coveted resources that were supposed to be used to buy your solution.

3. Payback or Return

Another major factor in establishing priority and resource allocation is the potential payback or the return on the time, money, and resources invested. Return, especially economic return, is evaluated on three different scales:

1. Quantity: How much return is possible?
2. Speed: How quickly can we expect those returns?
3. Certainty: How predictable are those returns?

Of course, we will be actively trying to determine the quantity, speed, and certainty of the potential payback so we can share our estimates with our client. This will become a crucial component of our overall value proposition. But to position ourselves and our solutions effectively, we should always begin by finding out what return or pay- back our customer expects or anticipates when they arrive at point ‘C.’

We help to quantify payback or return in their mind by asking questions that begin with ‘How much . . . ?’ or ‘How many . . . ?’

• ‘How much time could you save if you decided to move forward with this initiative?’
• ‘How many people would that free up for other projects?’
• ‘How much extra warehouse space could you lease to someone else if you were able to reduce your inventories by 20 percent?
• ‘How many more customer orders could you handle each day using this new system?’
• ‘How many days could we drive out of your product development cycles if we could cut your product testing time in half?’
• ‘How much money could be freed up for reinvestment if we were able to help you reduce your average accounts receivable cycle from forty days to thirty-five days?’
• ‘How much do you think this problem is costing you each month?’

At the end of the day, any investment has to be worth making. And as I pointed out , it has to be better than the other possible uses of available resources. Unfortunately, it doesn’t really matter how we think our clients should invest their resources; what matters is how they think they should. Our job is to find out how they think and why they think that way.

4. Consequence

You may have read or heard that ‘motivation comes from within.’ That might be true, but consequences come from without. How else can we explain certain behaviors? Do you suppose that every February 14, millions of men all simply wake up with an uncontrollable urge to buy flowers? Is it sheer coincidence that millions of Americans, every April 15, simultaneously have the inspiration to file their personal income tax returns?

Psychologists have found that our desire to avoid loss is much stronger than our desire for potential gain. One famous study found that most people would much sooner take $500 for sure, than take a fifty-fifty chance of winning $1,000. Likewise, far more people who had $1,000 would take a fifty-fifty chance of losing it all, as opposed to just handing over $500. In our minds, and the minds of customers, losses loom larger than gains.

Because of this fact, the potential consequence of inaction is often the most reliable Action Driver of all. If we can identify a consequence that matters enough, to enough of the people involved in the decision, the likelihood of that decision going our way is substantially increased. We will look much more closely at consequence  as we explore the ‘Anatomy of a Buying Decision.’ As we converse with customers and learn about their goals and objectives, we can look for Consequence by asking questions beginning with ‘What if . . . ?’

• ‘What if you just put this project off until next year?’
• ‘What if you just kept doing it the same old way?’
• ‘What if you just did nothing? What would happen?’
• ‘What if you put this off another month? What would that cost you?’
• ‘What if you decided you wanted to move ahead with this but you couldn’t get it approved?’
• ‘What if your finance department didn’t release the funding for another ninety days?’

Occasionally, in a seminar, I get a little push back on this one. ‘Bill, you should never ask a customer something like that,’ they say. ‘You don’t want to put the idea in their head that it’s OK to delay the purchase.’ Let’s not be naïve. Companies don’t buy on impulse. In fact, that’s the main reason companies institute buying policies that require a documented evaluation plan, multiple bids, a cost justification, and an elaborate approval process. There are multiple checks and balances put in place specifically to reduce the likelihood of buying something without considering all of the potential consequences and risks.

In a complex buying decision involving many decision makers and influencers, the question of ‘Can we put this off for a while?’ is one of the most basic questions they will ask. And if they still have to buy something but can wait until next quarter to do it, they probably will. I’d rather find out early on that there is little or no consequence for them to just stay at point ‘A.’ Then I can better prioritize my time, set expectations within my company, and go to work figuring out how to identify and leverage some other time-bound trigger that represents some sort of consequence to one or more of the people involved in the decision.

5. Resources or Means

Sometimes, when we meet a prospective client who shows an interest in us and what we sell, we assume that if they decide they want to buy, we’ve got a deal. Well, that’s not all there is to it, I’m afraid. We’ve already talked about limited resources and unlimited opportunities, as well as the process of prioritization and allocation.

When we discover what looks like a new opportunity to help our client achieve an objective using one or more of our products or services, let’s also make sure they actually have the means to acquire it, implement it, and make use of it. Some of the most embarrassing memories of my career resulted from my naïve assumption that once I convinced them they should buy, they were automatically able to buy. The question we need to answer is, ‘Do they have the money and the manpower to get to point ‘C’ if they want to?’

I remember one beautiful August morning a number of years ago when I received a phone call from the CFO of my number one prospect at the time. I had invested ten months on what promised to be a multimillion-dollar sale of enterprise software applications, and I thought to myself, ‘This is the call I’ve been waiting for.’

I had sat across the table from him months earlier, with my boss and his boss flanking, looked him in the eye and said, ‘I know your company has been struggling financially, and I know you are turning things around. But we will be investing thousands of dollars and hundreds of man-hours in this process of mutual discovery, and I need to know if there is any scenario under which you will not be able to afford to make this investment.’ His reply was an emphatic, ‘No. This is a strategic investment for us. We see this as part of our turn-around strategy, and we have to get this done.’ His boss, the CEO, was nodding in support.

On that August morning phone call, after I had invested all that money and time, the CFO said, ‘Bill, we just called your primary competitor and told them we are sorry, but we’ve decided to go with you.’ Have you ever had the feeling you’re about to hear a really big ‘BUT’?

‘But,’ he continued, ‘I also just spoke with the bank and they want to see two more quarters of growth and execution on our strategic plan before they will provide us with the letter of credit we need to take advantage of the financing you arranged for us.’

I’m sure that you’ve already guessed; they never did buy. In retrospect, I still think that it was that CFO’s responsibility to contact the bank to make sure they would provide the letter of credit before he allowed his people to invest their time-and waste our time-in an elaborate selection process. But it was clearly my responsibility to know whether or not he had done that.

People in my workshops often wonder why I tell stories about deals I lost. It’s because I’ve learned a lot more from my losses than I have from my wins. This particular disaster stirs emotion in me to this day, but I’ve been far less shy about asking resource and means questions ever since. You have a right, and indeed a responsibility, to ask all the questions about Resources and Means you can think of. Make sure that if you’re going to invest your selling time, they’ve got the resources to buy and use your solutions by asking ‘How . . . ?’

• ‘How do you plan to accomplish this particular objective?’
• ‘How do you see your project plan rolling out?’
• ‘How would you manage a project of this size and scope?’
• ‘How would you fund a project like this if you decided to move forward?’
• ‘How does an investment of this magnitude get approved? Does your board of directors get involved?’
• ‘How would you cost-justify an investment like this? Is there an elaborate capital budgeting process you have to go through to get approval?’
• ‘How could we both be sure that your bank will provide the letter of credit you would need to take advantage of the financing we’ve arranged for you?’

Hindsight is a wonderful thing.

6. Risk

I like to remind salespeople that there are always three elements of competition in every deal. First, there are those who sell what you sell, the other vendors or suppliers your customer will consider as a source. Second, there are all the other projects that will compete for the same limited capital dollars. It is possible that our primary competition for the $300,000 our customer will need to buy new networking equipment is a new advertising campaign designed to boost revenue this quarter. Third, and perhaps the most formidable of all, is the risk of taking action as opposed to doing nothing.

When the individuals within the company feel confident about the future, such that they expect to meet or exceed their revenue and profitability forecasts, then our primary competition for capital are the other investments they are considering. But when our customers feel the future is less certain, and they are worried about being able to meet their obligations, sometimes doing nothing-or at least doing nothing new-is the smartest thing they can do. The element of risk can be the fiercest competitor we ever go up against.

Risk is present to some degree in any investment situation.  We will talk more about managing and mitigating both actual and perceived risk. For now, let’s just be sure to ask our customers the questions that can reveal to us how sure they feel about their chances of arriving at point ‘C’ unscathed and achieving the results they want to achieve. Some good risk-related questions are:

• ‘What do you see as the risks involved in this endeavor?’
• ‘Is there any downside to starting this project right away?’
• ‘What are the obstacles to your success as you see them?’
• ‘What could go wrong?’
• ‘What could be done to reduce the likelihood of that happening?’

If we can understand the risks our customer perceives earlier in the process, we’ll have more time to deal with them by mitigating or eliminating actual risks or influencing our client’s perception of them through education and positioning.