On a daily basis I am asked "Given the current economic downturn, what changes are you seeing in how companies sell?"
I was preparing to comment on this question when I came across an interview that Neil Rackham, author of Spin Selling, gave to Gerhard Gschwandtner, of Selling Power. The topic was "What's the best strategy for selling in a recession?"
I agreed with many of the points made during the discussion and have summarized them below. The interview highlighted 3 courses of action:
- Focus on high probability accounts rather than high activity.
Focus on accounts you can win, don't just open more opportunities. Many Sales Reps think if they aren't making their number, the answer is simple - increase activity and add more opportunities to the sales funnel. Neil calls this "half selling to twice as many people". Certainly activity is important, however, many reps actually waste time on accounts that will never buy a thing just to show an increase in activity.
Reps should spend more time with high probability accounts, but in order to do so they need to have a well defined Ideal Customer Profile (ICP) supported by fleshed out Buyer Personas (BP). They are ready to shoot, they just need to spend some time aiming first.
Now is the time to refine your ICP and BP's by placing an extra emphasis on industries that are still buying and have not been as affected by the economy. Neil comments that successful companies, which do well in a recession, will "focus on fewer opportunities, put more resources to them, outsell the competitors & win." - Sales Leaders need to become very involved in key sales!
This is a fabulous point. Sales Reps need to know that management is involved and committed to their success. Customers need to know it's safe to make a decision to go with your company. Inserting Sales Leaders into the process can accomplish both these goals. - Pricing isn't the problem; it's about mitigating the perceived risk of buying from you.
Neil points out that in the last recession, Sales Leaders did everything they could to get to a lower price. This "didn't help them, it just cut their margins."
Sales reps feeling pressure will revert to discounts as opposed to re-crafting the vision of the prospect around why buying from them is the safer bet. In this selling climate, sales reps need modified messaging and training on how to convey this important point to the prospect.
As I said, it's a great interview. View the video interview here (runtime 4:30).