Selling services can be a feast-or-famine trade. Yet it seems that some consultants can close a deal even during the worst of economic times. It can't all be due to sparkling personality and charm. So why are some so successful?
"If you're going to have consistent revenue generation in any environment, you're going to have a very defined sales process," said Randy Kenworthy, CEO of deuxo and a veteran sales executive with more than 20 years in the business.
Kenworthy said that the top sales reps at deuxo—which sells software designed to help sales departments make the best use of leads—use its Intelligent Optimization sales process, a seven-step procedure designed to usher consultants and clients into successful sales.
Here’s a look at Kenworthy’s "contact to contract" method (Figure A).
Step one: First touch
The “first touch” is the first contact between the consultant and the client. Prior to this contact, marketing will have developed some sort of campaign to encourage a potential client to contact either a salesperson or the front-line employees at a firm, or to prompt the consultant to contact someone from the prospect's organization. Of course, consultants will want a potential client's first touch to be informative and friendly.
Read more about consultants and sales
Having trouble closing deals with potential clients? Maybe you’re making some basic mistakes. Learn what they are and how to avoid them in “Three common mistakes in selling services.”
Step two: Qualification, budget, purchase time frame
Following the first touch, consultants will ask surface-level questions regarding the client’s problem, or “pain,” and their readiness to solve the problem to see if the client qualifies as a good sales prospect. Additionally, the consultant will begin to ask what will happen if the client doesn't solve the problem and what benefits will come from its resolution.
Traditionally, many consultants get hung up in this part of the sales process because they don't explore such questions, Kenworthy said. Considering many organizations’ scrutiny of capital expenses and tight operational budgets, consultants must determine whether their product will help make life easier for the potential client. If not, the sale usually isn’t worth pursuing.
At this time, a consultant will also want to address the client's budget and time frame for purchasing the service or product. You'll want to consider "time and effort vs. reward," Kenworthy said. You must ask the client:
- Are funds available?
- Are those funds allocated?
- Who has to sign for them?
- What is the time frame involved in this process?
You need to begin to understand the organization’s decision process, including who the decision makers are, what roles they fulfill in the sales process, and what responsibility they have in relationship to the problem at hand, Kenworthy said.
Often, this involves understanding your client’s complex hierarchy of decision makers. “If you're selling business to business…it's a complex selling environment, which means that there are multiple people at different levels in different departments at the organization that you have to get to say 'yes' before a decision can be made,” he said.
Step three: Pain, position, need consequence, and player roles
Kenworthy said deuxo's sales staff subscribes to the definition of players and roles as set out by the Miller Heiman sales training program. Using such guidelines, those at the client organization involved in the purchase process have specific roles.
For example, one of the client roles is the economic buyer. “That's the individual inside of an account that can say 'yes' or 'no' to your proposition, regardless of what anyone else says, thinks, feels, or does," Kenworthy said.
Other roles include the coach, the technical recommender, and the informative communicator. The coach will "embrace you and help you maneuver through the internal political minefield and make sure that you get what you need," Kenworthy said. The technical recommender, who can be an individual, a committee, or a third party, "takes all the various competitors in the deal and compares and contrasts and makes a technical recommendation to the economic buyer as to what direction he or she should go."
The informative communicator can be one or several people who will provide information to you as a consultant.
"It could be a secretary, an IT guy, or it could be the person you're trying to sell to," Kenworthy said. "It could be anybody."
Once those client roles are identified on a surface level, the next step requires the salesperson to dig deeper. In step three, Kenworthy said you must discover each player's individual pain, needs, and consequences. So for each individual defined as a key player, he said you must ask yourself:
- What is the individual's pain?
- What is his or her position in terms of solving the pain?
- What does the individual want to get out of the solution?
- If the individual doesn't solve the problem, what is the consequence to the individual in terms of his or her professional role inside the corporation?
- What is the consequence to the individual personally?
Many sales consultants in business-to-business transactions don't take into account the stakes involved for the individual players and sell only to one player, Kenworthy said.
"They don't comprehend the personal ramifications if the wrong decision or no decision is made," Kenworthy said. "Getting fired because you didn't act and the company lost 5 percent market share is a personal ramification, not a professional one."
Know when to say when: Qualifying out
“Qualifying out” means that as you complete the first three steps of the process, you're asking questions, determining needs, and uncovering potential roadblocks to the sale. Kenworthy recommends that consultants qualify out as they go through this process to ensure that they’re not wasting their time with a client who will never sign a contract.
Kenworthy suggests that consultants should "cut bait and go fish in another pond" if they do not find all of the following four qualifiers in an account:
- High pain and consequence
- An approved budget
- Incentive for the account to move forward in a reasonable time frame
- A clear path to decision making inside the account
"If all those things aren't present, you're probably going to call up the account and say, 'I've really enjoyed meeting you, but it's not clear that you really need what I have to offer, and I certainly don't want to waste your time,'" he said.
Common problems in selling services
Kenworthy has identified several common problems that consultants experience while selling services. Next week, TechRepublic will offer an article about those problems and Kenworthy's solutions.
Step four: Education and competitive comparison
Step four requires the consultant to return to the client and restate the problem, the associated issues, and the consequences as he or she has come to understand them. At that point, you begin to educate the client as to how you can help them solve their problems and why your solution is better than any solution another firm may offer.
Step five: Trial close, update qualification, quote, and trial close
A "trial close" means that you propose bringing in your solution and determining a preliminary time frame. Kenworthy said you might say, "Sounds like we've got a marriage made in heaven: You've got a problem, and I've got a solution. I think we could begin installation in 30 days. How does that sound to you?"
"If all the heads in the room are nodding like the dog in the back of the '57 Chevy as you go through that," Kenworthy said, "then you go in for a trial close."
However, if the clients react negatively to the suggestion, you'll have to go back through the first four steps to find out what problems you've missed, or "update qualification." After that, you can attempt a trial close again.
If the clients indicate that they're interested but need a little more time or a formal proposal, you can proceed to the next step with a quote or a proposal, Kenworthy said.
"You're looking for an indication that they're still serious about moving forward and that things have not changed," he said. "At every step in this process, you're constantly reaffirming what you've already learned. You're constantly approaching that reaffirmation from different angles and with different people to make sure there's not conflicting stories or information."
Step six: Proposal negotiation, contract negotiation, and close
If the clients are reacting positively to your trial close and indicate they'd like to move forward, the next step is to get something on paper. Depending on the product or service you're selling, you'll present the client with a quote, proposal, or term sheet.
Quotes are typically price-oriented documents stating individual line items and their costs. Proposals spell out "in excruciating levels of detail" the problem, solution, and why the client should choose your firm to solve the problem, Kenworthy said.
Term sheets are typically two- to four-page documents focusing on deal points like price, installation time, applied resources, service-level agreement terms, termination clauses, and payment terms.
The type of document you choose often depends on the level of commitment you've already received from a client, Kenworthy said.
"A term sheet is typically used at this stage when you know you've got agreement and people already know who you are, what you are, and how you can help them," he said. "If you can skip over [the] proposal stage…typically you're miles ahead because what you're doing is prenegotiating the contract in a nonlegal form."
Many consultants also include a boilerplate contract with their proposal, quote, or term sheet. If the client accepts the contract and sends it to their legal department, Kenworthy said this is a "huge affirmation" of their willingness to commit to your solution.
After you've reached agreement with the client on the broader terms of the contract, lawyers from both organizations usually complete the remainder of the negotiation. Items that lawyers typically negotiate include:
- Venue (under what law the contract is governed).
- Key nondisclosure items.
- Breech-of-contract items.
Step seven: Installation or fulfillment of contract
Kenworthy suggested that once a contract is signed, the celebration for many consultants is short-lived as they begin step seven, installation or fulfillment of the contract: "Once you get a contract signed, you get into the real meat of the thing of getting it installed, implemented, and making somebody happy with what they've got."
Consultants on sales
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