Salespeople, by and large are known to be gregarious and outwardly confident. By the nature of what we ask them to do, there is a requirement that they are confident and out-going people. And yet experience has taught me that many salespeople in fact lack confidence in sales negotiations.
A lack of confidence
Most sales people would not admit to lacking confidence in their ability. For one thing, doing so might lead us to question their ability to do the job. For another, many are not actually aware that they lack confidence.
During a sales programme we ran recently, I heard one of the delegates say that he “knows” when a price is likely to be met with the response “too expensive” and so goes in at a lower price; “to secure the deal”. An experienced (and outwardly confident) salesperson, this individual was unaware that their lack of confidence to negotiate was directly impacting their results. That lack of confidence to negotiate comes about from the inability to identify and communicate value, earlier on in the process.
(Read The Secret to Communicating Value to your Customer for more on Creating, Communicating and Capturing value.)
If we want our salespeople to smash their targets and deliver results, we need to ensure they have the skills and confidence to do so and that means having the ability to: Create real insights for their customers, Communicate the value of those insights and then negotiate effectively to Capture a fair share of the value created.
Identifying the problem
There are some ‘clues’ which can help:
Look at margins. If margins are decreasing and salespeople are using price to secure the win, it could mean your salespeople lack the ability to negotiate and clearly articulate the value they can bring to their customers.
Look at cross selling or upselling. Are you missing opportunities? If so, it could mean your salespeople lack the ability and confidence to position the value effectively, or are failing to give enough time over to it.
Look at lost deals. Examine why deals are lost and at what stage in the process. Higher than expected volumes of lost deals can indicate:
- A lack of ability to identify key decision makers.
- A poor understanding of the buying process and how to guide customers through it.
- An inability to identify the needs of customers and find insights which meet those needs.
Addressing the problem
There are two invaluable processes I have found which can significantly improve performance and outcomes:
Observe your sales people selling – For all sales leaders, this should form part of your coaching process with your sales people. Quite simply, you cannot hope to fully understand where in the process your sales people are struggling without watching them in action. Sessions should include feedback (away from the customer interaction) and follow-up actions.
Deal Review sessions – Bringing members of the team together, the group work on existing live deals, being coached through the process (by either the sales leader or an external coach); helping them to identify new or added value they can bring to a customer, successfully negotiate and close the deal and secure wins that deliver value for both their customer and the business.
If you’d like to have a further chat about this or how we could help you inside your own organisation, then please contact me firstname.lastname@example.org.