Separating Sales and Prospecting

Prospecting and selling are certainly related, but they require different mind and skill sets. They are two different and distinct activities. You will only be effective in your prospecting efforts if you successfully differentiate the two activities. With the right training salespeople can make excellent prospectors, but they need to take their sales hat off and put their prospecting hat on when they are prospecting for Wanters (qualified prospects who are ready and willing to buy).

Although there are notable exceptions, without the right training most salespeople are not efficient or effective at prospecting.

Why is that you ask. There are two reasons. The majority of salespeople receive some type of base pay, plus benefits, sales commission, and often a bonus for achieving their sales quotas. The net result is salespeople naturally focus their energies and efforts on closing sales deals, because that’s where the money is. That’s highly motivating and a great process for driving sales, but it has an unintended and seriously negative impact on both prospecting and establishing relationships with prospects that are not ready to close—especially when industry research and experience shows that there’s only a 25 to 33% chance of closing those deals anyway.

The second reason is that salespeople have been falsely taught that the primary purpose of prospecting is to generate an appointment. Sorry, that is simply not true. The primary purpose of prospecting is to qualify a “suspect” company. Do they or do they not use the products and services you provide. After that the second prospecting objective is to gather relevant marketing and sales information prospect (business or needs). The third step is determine their Willingness To Buy. There is usually a big difference between a prospect’s use of your products and services and the immediacy of his need for more of them, now. In another blog I’ll have much more to say about generating appointments. Here is a teaser in the meantime. Prospectors have virtually no control over whether a prospect is in the market for his products and services.

Salespeople, even those who are very good at what they do, typically don’t work at anywhere near their maximum effectiveness. Five years ago, the average sales professional spent over 30% of her time in a face-to-face selling situation. Today, that number is 19%. (CSO Insights 2008 Survey Results and Analysis) It may not be the only way, but better prospecting is certainly one way of increasing face-to-face selling time.

There’s never been a greater need for effective prospecting than there is today. High quality prospecting programs make it possible for salespeople to do what they do best. Your prospecting program should be designed to work symbiotically with your sales process, not disrupt it any way. Its main goal is to produce more sales, but prospecting is not selling. Prospecting is making connections, gathering information, and building trust that in turn results in to high quality sales opportunities.

Why Prospecting Always Works

Ekstrom & Associates was founded on the recognition that closing sales starts with buyers who are in the market and ready to buy. If you want to increase your sales, you need to maximize your opportunities with the best qualified prospects. It’s only common sense, but the difficulty comes in finding qualified prospects. At Ekstrom & Associates, we call qualified prospects that are in ready to buy, Wanters. A Wanter is simply that: special prospect that is ready and willing to buy. They want something. They are going to buy that something from someone. Getting in front of qualified prospects with a high degree of willingness to buy is what prospecting is all about.

Think of it this way. For every 100 sales that close, deduct the number you closed and subtract that from 100. The resulting number is the number that your competition got. How many do you want them too get, because every one you don‘t get, they get? At Ekstrom & Associates our motto is simple and straight forward, “Prospecting Always Works.”

Prospecting always works because:

It gets you in front of the right prospects. It provides a steady stream of qualified prospects And, it maximizes the chances of connecting with the right prospects at the right times.

It is important to distinguish prospecting from sales. They are two separate and distinct activities. In prospecting you are searching for different kinds of information, the more accurate the information you gather, the richer your resulting sales stream will be. Sales is about closing deals. Therefore, prospecting is the dynamic process of streamlining your efforts to find those Wanters who are actually ready and willing to buy exactly what you have to offer. It’s a series of related activities that result in both sales leads and valuable marketing information. This marketing information can then be used to generate additional sales opportunities for your sales staff and profit for you business.

Prospecting isn’t like mans nylon stocking where one size fits all. If you want prospecting to work for your company, you must design a system that unique to your company’s circumstances, a system that is efficient and effective, and a way to ensure it stays that way.

Regardless of the economy or world events, a reasonable percentage of qualified prospects, or Wanters, are always in the market. And once you have a client you can cross sell to him. Done right prospecting is the gift that just keeps giving.

There is no mystery to prospecting; when done correctly it always works.

“X” Percentage: The Foundation Element of Prospecting

There are many ingredients that go into producing a successful prospecting system. Perhaps the most fundamental is an element that The Prospecting People at Ekstrom & Associates have dubbed, “X” Percentage. Understanding this one concept can give you the motivation to do the few simple things to increase sales revenues and drive greater profits to your bottom line. When you understand the “X” Percentage you can begin to realize the full potential of your business.

“X” Percentage is a simple and basic thought process:

Whatever product or service you represent some percentage of your prospects, or “X” Percentage, will buy this year. It doesn’t matter what you sell, it doesn’t matter the times or the economy, the fact is there will always be some percentage (“X Percentage”) of prospects ready to buy, or in the market place at any given time. It might be insurance, software, houses, cars, envelopes, furniture, tractors, whatever. “X” Percentage of the prospects within your sales territory will buy this year. It is a wonderful concept, one that will make you rich if you truly understand and use it. As the late Paul Harvey used to say, “Here is the rest of the story!”

“X” Percentage will also buy next year and the year after, and the year after that. “X” Percentage is perpetual and self-renewing. It’s just a fact. In times of expanding economies prospect buy more. In times of contracting economies prospects buy less, but on average “X” Percentage will always be ready to buy.

Armed with that knowledge you can get rich. Here’s how.

What portion of the X Percentage would you like to sell? Grab a piece of paper and write down answers to the following questions.

1. Whatever product or service you represent, how many units were sold last year? You don’t have to 100% accurate for this to be a valuable exercise. You can refine your answer to whatever degree of accuracy you want later. For now, just go ahead and jot down your answer and label it number 1.

2. Of the amount you wrote down and labeled number 1, how many unites did you or your organization sell? Write down that number and label it number 2. By performing a little simple arithmetic can calculate your market share.

3. Subtract number 2 from number 1. The resulting number represents the number of units your competition sold. Write that number down and label it number 3.

Now, what was your closing ratio? If you got in front of 100 prospects and sold 25, you have a 25% closing ratio. Write the amount of your closing ratio down and label that as number 4.

4. Divide the number of units your organization sold (number 2) by your closing ratio (number 3). The resulting number represents the number of prospects you got in front of last year. Write that number down and label it number 5.

5 Subtract number 5 from number 1. The result represents the number of deals you did not get in front of last year. Write that number down and label it number 6.

6 Multiple number 6, the number of deals you did not get in front of last year by number 4. The result represents the number of additional unites you would have sold had you gotten in front of the prospects you didn’t get in front of.

Prospecting is the key to getting in front of the prospects you didn’t get in front of last year.

More sales are lost because of failure to prospect than through the failure of any other step in the sales process. By failing to optimize prospecting … businesses and the salespeople that work for them deny themselves the sales opportunities … sales revenues and profits that would have otherwise resulted. We unconditionally guarantee that a failure to optimize prospecting needs never be an obstacle to you in growing your business and increasing market share again.

“X” Percentage, and what you can do with it, can begin to answer a lot of prioritizing and prospecting questions for you. Decide what your final number is worth to your organization and set your sites accordingly.

Questions that can make you money

When prospecting, it’s vital that the person doing the prospecting has the right script, featuring the right questions, to produce the greatest return on your prospecting investment. Ekstrom and Associates can help!

First, your prospector must make a great first impression. Often this is your prospects first contact on behalf of your company. Then the prospector needs to be able to get past the receptionist to the decision maker (DM). By asking the right questions, the prospector can determine whether the company is qualified, gather relevant marketing information, and depending on the prospect’s Willingness To Buy generate fully qualified sales opportunities.

But what are these questions? And how does your prospector direct the conversation to obtain these goals?

Keep in mind that the goal of your prospector is two-fold: To qualify the prospect company and gather critical marketing intelligence you can later use to generate additional revenues from this prospect. Unless you can make money on the information you are gathering, it’s not worth asking the questions.

Step One: Initiating Activity with the Receptionist. Your prospector first needs to be trained to get past the receptionist. You’ll need two versions of questions: one for when the Project Manager knows the name of the DM, and one for when he doesn’t.

If the DM’s name isn’t known, the script should go something like, “Hello, my name is __(prospector’s Name)_ … and I’m hoping you can help me. Can you tell me who’s responsible for ____ at your location?

If the DM’s name is known, the script will go something like, a. “Hello. My name is, _(prospetors name )_. If __(First Name)_’s there, _(First) __ _(Last Name)____, I need to speak with him / her please.”

Step Two: Initiating Activity with the Decision Maker. Once your prospector gets to the person he is trying to speak to (DM), she needs to accomplish three things: Introduce himself, explain who he represents, and what his company does. Think of it as
“My name is…..”
“My company is….”
“We do….”

Step Three: The Transition Question. Immediately after the initiating activity, create a transition question to get the prospect talking about your subject. For example: “I understand you’re the person who is responsible for purchasing _____ there … is that correct?”

By asking this question, you have just qualified your Decision Maker (QDM) and quite likely the prospect’s company as well. If he says yes to this question, the prospector knows he is speaking the correct person. Second, he has set the direction for where the rest of the conversation will go.

Question Four: The Prioritizing Process. At this point in the questioning, you want to gather sufficient information to determine how much time and effort you want to devote to this particular organization. You are trying to determine how many, how big, or how much. For example, if your prospect has a number of large warehouses and you have a door-maintenance business, you might ask: “How many doors does your warehouse have?” This is a “how much” question. Then, you can follow up with: “Are the doors left open in the summer?” This is a “how often” question.

Step Five: Gathering Marketing Information. Following our previous example, ask this question: “Do you repair your own doors or does someone outside your company do that for you?”

Step Six: Determining Willingness To Buy, or “weeding out”.
For example: “Do you plan to add, replace or upgrade any of your warehouse doors, dock equipment this year?” This question allows you to refine information about the prospect and determine if he going to be is in the market this year.

For more in-depth information on how to develop questions that will make your company money, contact us here.

In a later blog post, we’ll talk more about creating a well-developed script.

About Ekstrom & Associates

Welcome!

Our wish for your business is the same as yours. We want your business to prosper, to become increasingly more profitable, and to be the dominate business of its type in your sales territory.

Ekstrom & Associates provides professional, business-to-business prospecting. We are the prospecting people and prospecting always works! We are expert at assembling focused prospecting lists. We know…

• How to contact
• How to get past the attack receptionist to the right decision maker
• How to make a great first impression
• How to get answers to the questions you want asked

With our service, you will know which prospects are active in the market, what their purchase plans are and what their timing is. We have been helping businesses grow their profits for almost 20 years and we know how and what to do to help you realize your growth objectives. If you really want to grow your business, why not talk with us about it.

To have that discussion all you need to do is click here right now and complete the form you will find there.