Musings on Entrepreneurship and Innovation
Thursday, November 11, 2004Selling is a Collaborative Act of Learning
BusinessPundit.com points to an article titled Why Demonstration Compels Customers to Buy that echoes some established, but too often neglected, wisdom:
Tell me, and I'll forget; show me, and I may remember; involve me, and I'll understand.
As my Venture Dynamics Group colleague Laura Black likes to say, collaboration is the co-creation of knowledge. Selling is a collaborative act that involves:
- Identifying a gap between a customer's current state and desired state
- Making explicit the expected consequences of closing, or failing to close, the gap, and
- Recommending a solution
As consumer choice increases, the old "make and pitch" sales method becomes less effective. Customers want products and services that can help them achieve their personal objectives, not the objectives of a mythical average consumer. As Cindy Taylor of The Improved Performance Group has said,
Effective selling is helping people get what they want. We know what we want. We want them to accept our product or service or our solution or our idea. We want to convince them of something. But what do they want? So we have to think about all the things that this person could want, and we have to understand what they want, and then we have to be able to show them that what we have helps them get what they want, it satisfies their want or their need.
Consequently, engagement with the prospect in order to collaboratively develop the knowledge required to make the sale is increasingly important. It's less important that salepeople are polished persuaders and more important that they are effective listeners and learners. I believe that's particularly true when offering an innovative product or service. (See my earlier post on the sales learning curve.)
I witnessed this in the early days of RightNow Technologies (Nasdaq: RNOW). After having climbed the sales learning curve himself, the company's founder, Greg Gianforte, began to aggressively hire as many bright, energetic -- albeit inexperienced -- sales people he could find. Notwithstanding their lack of "sales polish," most achieved a surprising (and profitable) level of productivity in short order. Their secret? They used personalized, interactive demonstrations of RightNow's web-based customer relationship management solution to engage prospective customers in high-gain conversations. The technique worked when RightNow was a startup working out of the back of a realtor's office. It's a technique that is featured on the home page of the company today:
The themes of engagement and collaboration aren't just germane for companies selling their products and services to customers. As the venture capital and private equity markets are transformed into industries marked by an increasing number of more narrowly focused firms, the one-pitch-fits-all-investors strategy is becoming less and less effective. Be wary of the urge to pitch. Start by engaging VCs -- and the people who know them -- in real conversation. Learn about the specific needs and fears of your prospective customer: the potential purchaser of your company's convertible preferred stock offering.
