Friday, November 30, 2007

Salespeople as Customers?!

Have you ever thought about your sales staff as customers? Henry Ford thought of his employees as customers for his cars. He wanted to pay them enough and charge the buyers so little that his employees could afford to buy the cars that they made. However, what I am suggesting here is that we should go even farther with the sales staff – we should literally treat them as customers of their company’s management.

Many sales people are incented to sell. They often make a percentage of their income based upon how well they do in sales. There was a recent Dilbert cartoon strip (2004) which focused on strategies for selling without a sales staff. The pointy haired boss thought he could reduce headcount by eliminating sales. All he needed was for marketing to find a way to get customers to select their products, pay for them and pick them up at the warehouse. Obviously, sales staff is needed to meet customers’ needs.

Some companies have taken the idea of treating sales staff like customers to heart. There are benefits to following a robust process for developing customer-centric products and services (see the stiehlworks.com). What we have done in consulting for these companies is to follow the same process for developing ideas to improve the performance of sales staff.

For one manufacturer of durable goods, we conducted a "Voice of the Salesperson/Employee" study. The resulting internal predictive metrics and survey results were used to generate strategies for improving sales success. In this company, several key strategies emerged which lead to a tremendous reduction in the time required to track and report sales progress. The sales tools were integrated and updated. The result was a 25% increase in sales without hiring additional sales people!

A robust system of metrics, surveys and analysis had been created which could be perpetuated. Employee satisfaction improved significantly, as the sales staff felt that management was listening to them and being responsive.

This company had learned how to treat their sales force as customers of management and management decisions. The management saw that treating sales people like customers resulted in better service to the customers and higher customer satisfaction scores as well.
Treating their sales staff as customers of management and management systems resulted in increased revenues and profits for the company as well, and that is the mission of the sales staff, isn’t it?

Tuesday, November 6, 2007

Beauty and the Geek All Day Seminar November 16

An all-day seminar on “The Science of Clients: How to Win Clients and Influence Referrals” featuring the pair dubbed Beauty and the Geek: Rhonda Sher, author of The Two Minute Networker, and Henry DeVries, author of Client Seduction, will begin 9 am Friday, November 16, 2007 at the Carlsbad Village Theatre, 2822 State Street, Carlsbad, CA 92018.

Why are these two authors nicknamed Beauty and the Geek? Sher and DeVries have been married for 27 years, but not to each other. He has an appointment at two universities. She has appointment every week to get her nails done. Both are professional speakers and authors who have teamed to train advertising, marketing, public relations and other professionals on how to find, keep and grow clients.

“You can call us Beauty and the Geek until the Fox attorneys file a awsuit,” says DeVries.

The session will cover how to get more clients, how to charge clients more money and how to smooth over client problems. Cost is $99 in advance at www.scienceofclients.com. For more information visit the Web site www.scienceofclients.com or email info@newclientmarketing.com or call 800-514-4467.Meet Beauty and the GeekClientologist Henry DeVries, MBA is a best-selling author, marketing instructor at UC San Diego Extension, and founder of the New Client Marketing Institute (www.newclientmarketing.com). Rhonda L. Sher is the founder and owner of The Two Minute Networker, one of the nation’s leading networking training companies. Rhonda is the expert at teaching others how to “take the work out of networking.”

Friday, November 2, 2007

Pain and Your Value Proposition

What is a “Value Proposition?”

The value proposition for your company or business is the statement of why your customers should give you money – what do they get in exchange for the money that they pay you?

How do You Write One?

One of the toughest yet most important tasks that any business has to undertake is to explain to its customers why they should pay for the company’s products and services. Why should they (your customers and customers) give you money? What is the “value proposition?”

We fly airplanes often as consultants. A question that is often asked of us by our fellow passengers is: “What services do you provide?” followed immediately by “That sounds interesting, who are your customers for that service and why do they need a consultant for that?” In other words, “What is your value proposition?”

Co-author Chris Stiehl’s friend Bradley Gale (author of Managing Customer Value and The P.I.M.S. Principle) often speaks of customers making decisions based upon the value of the deal, not the price. After all, if price was the major factor in decision-making wouldn’t we all be driving used Yugos? We aren’t. Why? Chris thinks we make such decisions based upon the utility of what we receive as compared to the price we pay; i.e., the value of the deal, where price has several attributes. The price attributes can range from initial cost to the hassle of dealing with you as a supplier to the long-term costs and many other cost-related factors.

Dr. Gale’s book addresses several issues: What is customer value and how is it managed? Who “owns” it? What are the specialized tools that are used to manage it? What data is needed? The market research elements that Dr. Gale discusses include the “Pain of the Customer,” customer satisfaction survey data and the “House of Quality.”

A value proposition captures the essence of these ideas: what is the utility you receive from our products and services versus what does it cost you? Of course, the better the utilities are described by the marketer or salesperson, the better is the perceived value by the customer. This is where the “Pain of the Customer” fits in. Marketing professionals have known for decades that customers respond best to ads that speak to their pain, both the fact that you understand it and the fact that you can solve it. Recent literature has shown that businesses behave the same way, especially with respect to “hi-tech” products and services. They want their risk of pain alleviated.

Thus, for your value proposition to work, the customer must perceive that his pain or risk of pain will be reduced, or there is an excitement about the positive attributes (features) of your product or service with minimal risk (pain avoidance).

Checklist of 5 Keys to a Great Value Proposition

1. Be able to express the value of your product or service in terms of how it solves or deals with the customer’s pain, or how the customer benefits with minimized risk of pain.
2. Make sure you understand how much that pain costs them in terms of dollars, staff, time, hassle and energy; i.e., the total cost.
3. Be sure to understand the costs of your product and service, both initially and long-term, including the hassles for the customer, if any.
4. Make sure you can articulate the value (the return) on the investment with your company in dollars and cents and when payback should be expected; this necessarily involves analysis of the dollar value of benefits that may not be easily quantified.
5. Be aware of their alternatives (competitors to you or the option of doing nothing) and what advantages you have over each alternative; proper value proposition analysis includes head-to-head comparisons with all of the customer’s choices.

Sunday, October 14, 2007

Why Worry About the Pain of the Customer?

Bradley Gale and Robert Buzzell in The PIMS Principle stated, “…businesses with a superior product/service offering clearly outperform those with inferior quality.”

Does worrying about the customer’s pain really pay off?

The data from over 450 companies (in The PIMS Principle) shows that companies that care about quality and meeting customer needs have stronger customer loyalty (more repeat business) and are less vulnerable to pricing strategies (price wars). These companies can command higher prices for their products and services. They have lower marketing costs. A customer that buys from one of these companies is less likely to be challenged by management for making that decision. It is a “safe” decision.

Many companies collect pain points. We have seen lists of several hundred pain points within a division of a Fortune 500 company. How does this company decide which pain points to address? In most cases, the decisions are political, based upon who complains the loudest. Obviously, with a list of several hundred pain points, only a small percentage of these ever get attention. Much of the focus of this book is to help you decide what needs attention, how to select the appropriate issues and what strategies would address the most pain points where you have the most to gain.

As you progress through this book, realize that most customers respond to products and services that reduce their pain or their risk of pain. Do you remember the ads for headache and pain relievers from years ago? Some of these ads give you the impression that they are striving to create the headache that their product would then solve! Customers respond to pain in advertising. Any popular magazine illustrates this point. The ads, even in business magazines, often focus on one or more pain points and use the solution or reduction of pain as a key to the promotion of their product or service.

Keep in mind that the pain of the customer is the foundation of the Pain of the Customer and all of the processes described herein.

Monday, October 8, 2007

Six Ways To Prepare Your Business For Future Shift

Are you prepared for the coming shift in the economy that business futurists are predicting. Below are some tips from Scott Hamilton of Blue Velocity Partners. Join Scott and Henry DeVries for a free teleclass at 5 pm Pacific Time Tuesday October 9 by calling 712-945-1601 and then pin # 968996#.

Did you see this in the news? More than 100 homes in the upscale San Diego community of La Jolla were evacuated after a landslide about 60 yards wide pulled the earth from beneath a three-lane road and some of the multimillion-dollar homes that adorn it.

The Mayor of San Diego declared a state of emergency, asking California and the federal government to help the La Jolla community recover from the landslide.

Was this a surprise? No, cracks had appeared in the road for months. Officials warned for at least two weeks that the ground was shifting beneath the hillside community along Soledad Mountain Road.

How does this apply to your business? Please know this, there are serious cracks showing in the U.S. economy. A shift is about to happen in the world of business. You need to be able to make some hard decisions in the coming months.

According to futurist Joel Barker, it is a “leader’s responsibility to take care of the future.” Joel Barker was the first person to popularize the concept of paradigm shifts for the business world. He discovered that the concept of paradigms, which at that time was sequestered within the scientific discussion, could explain revolutionary change in all areas of human endeavor.
Barker says people shoot down good ideas because they assume that the future is merely an extension of the past. Many things we accept today once met substantial resistance from thoughtful people.

People resist change when they operate within old paradigms. These paradigms establish boundaries and provide the rules for success.

People tend to filter out information that doesn't fit the paradigm. Barker calls this the “Paradigm Effect.” This can block creative solutions to problems and the ability to see the future.

To illustrate, Barker tells stories of triumph and disaster resulting from paradigms. Here's one:
Question: What nation dominated the world of watch-making in 1968?
Answer: Switzerland, a country renowned for over a hundred years for watch-making excellence. In 1968, it held 65 per cent of the market.
Question: What nation dominates watch-making today?
Answer: Japan, a nation which, in 1968, held virtually no market share.
Reason: The introduction of the quartz watch.
Question: Who invented the quartz watch?
Answer: The Swiss. The Swiss were so certain that it was only a novelty, they showed it promiscuously at a trade show.

The Japanese came; they saw the idea; they conquered the market. The Swiss failed to see the potential because they had a financial and emotional investment in the old paradigm.
Barker says: “When a paradigm shifts, everybody goes back to zero. It doesn't matter how strong your reputation, or how big your market share, or how good you are at the old paradigm.”

Barker makes these key observations about paradigms:
1. Paradigms are common. They apply to all areas of our lives.
2. Paradigms are useful. They show us what is important.
3. A warning: Sometimes paradigms become THE paradigm — the only way to do something. Thereafter, any new idea is rejected out of hand. Barker calls this “paradigm paralysis.” It’s a terminal disease that has destroyed many a mammoth.
4. The people who create new paradigms are usually outsiders. They are not part of the established paradigm community. They need not be young, but they are people who are not invested in the old paradigm.
5. The paradigm pioneers must be courageous.
6. You can choose to change paradigms — to see the world anew.

Want to learn more? Then attend the teleclass on October 9 for free or attend this $35 workshop with Scott Hamilton October 12 in Irvine, CA:
Forecasting the Future—Joel Barker’s Strategic Exploration Business Tools
October 12, 2007
Irvine, CA
8:30am-12noon
Continental Breakfast Served
How to:
—Reduce uncertainty in your plans
—Improve the Accuracy of your Forecasts
—Achieve Consistently Better Results
Presenting the Implications Wheel® and the Strategy Matrix ® (Bonus presentation of John Kotter’s workshop—Leading Bold Change based on his bestselling business book Our Iceberg Is Melting is included.)
Key learning points addressed in this session include:
Learn how to reduce uncertainty, out-innovate and out-maneuver the competition by forecasting the implications of your decisions before they occur.
Powerful software allows you to rapidly identify positive and negative potential outcomes—even identify sources of stakeholder conflict
The Strategy Matrix uncovers the intended impacts that exist in all strategic plans
Forecasts the effect of your strategy or a competitor's innovation on your plans
Identify and remove obstacles that prevent people from taking action
You will identify additional forces that will increase or decrease the likelihood of being able to achieve true change
To Register For This Event:
The registration fee is $35 and includes continental breakfast and a catered lunch.
Click here to pay with Visa, Mastercard or American Express.
Or call toll free at (888) 857-9722.
Session held near the John Wayne Airport in Irvine, CA.
2091 Business Center Drive, Suite 230, Irvine 92612
Chris and Henry are both members of Blue Velocity Partners, a regional team of senior level consultants whose mission is to help organizations move into new spaces, take on tough decisions and navigate change. While we recognize the importance of great strategy, this is to no avail if the window of opportunity closes or the execution is flawed.

Friday, October 5, 2007

Turn Pain Into Blockbuster Marketing


Did you know that psychologists and sociologists have repeatedly found that people are more motivated to avoid pain than to seek pleasure?

For instance, in an attempt to explain how and why some individuals with pain develop a chronic pain syndrome, in 1983 Lethem et al. introduced a so-called 'fear-avoidance' model. The central concept of their model is fear of pain. 'Confrontation' and 'avoidance' are postulated as the two extreme responses to this fear, of which the former leads to the reduction of fear over time. The latter, however, leads to the maintenance or exacerbation of fear, possibly generating a phobic state. In the last decade, an increasing number of investigations have corroborated and refined the fear-avoidance model.

Another example is that microeconomic theory maintains that purchases are driven by a combination of consumer preference and price. Knutson et al. of Stanford University investigated how people weigh these factors and use pain to make purchasing decisions. These researchers demonstrated that separate parts of the brain are activated when people are confronted with financial gains versus financial losses. The study shows that distinct brain regions are triggered when consumers are offered products they wish to buy (a potential gain) and when they are offered the products' prices (representing a potential loss). The results of their study (“Neural Predictors of Purchases,” Neuron Magazine, January 2007) show that consumers are trading off the hoped for gain of making a purchase against an immediate pain: the pain of paying money.

Your target market experiences its own unique frustrations and pains. The secret to maximizing your attraction factor is to articulate the worries, frustrations and concerns that you solve. As the old adage states, “People don’t care what you know, until they know that you care.” Truly identifying your market’s predicament tells them that you understand and empathize with them.

Here are some ad headlines from companies who understand the power of pain:

“What if your labeling printer makes 12,000 errors a minute?” – Zurich American Insurance

“Here’s to road warriors with spines of steel and delicate backs” -- Courtyard by Marriott

“Nickeled and dimed? I feel like I’m being quartered.” -- Charles Schwab

“Is your cholesterol out of whack? – Crestor by AstraZeneca

“There’s more at risk than your reputation.” – Electro-Federation of Canada

“We can’t keep it from getting knocked around, but we can keep it from getting knocked out” – Tecra A8 Notebook Computer by Toshiba

“Unburden your back.” Kensington Notebook Computer Cases

“When bad vacations happen to good people.”—Travel Guard International

If you are a business who struggles with marketing, you are not alone. Many companies are tired of the rejection, frustration and mystery of marketing.

There is a better way to attract customers. The secret is to turn their pain into your gain. Start by asking customers about their pains. Then gather information on how to solve those worries, frustrations and concerns.

Let us ask you this (now be honest): Do you really understand the problems of your prospects and customers? Or do you just think you know? Make no doubt about it, the stakes are high. Wrong marketing messages will cost you potential customers and lead to more struggles and frustration.

So here’s how to become a new customer magnet. Each group of prospects experiences its own unique frustrations and pains. What’s the secret to crafting a marketing message that will maximize your attraction factor? Ask them (or have someone ask for you) about their pains. Start by asking a sample about their ideal business, and then segue into problems. Listen carefully to the exact words they use (you will want to mimic them in your marketing messages).

When you interview some current, past and potential customers about the pains you solve, here are 10 questions you should always ask:


Describe for me the “ideal” experience with a ____________ (your product or service). How do most compare to this ideal?
Describe for me a recent time that the experience was less than ideal.
What are the three most important aspects of doing business with a___________.
If I said a __________ was a good value, what would that mean to you?
In what ways does dealing with a _________ cost you besides money (time, hassle, effort, etc.)?
What is the biggest pain about working with a _________.
Would you recommend a _________ to a friend or colleague? Why, or why not?
How does working with a _________ help you make money?
What does a _________ do really well?
If you had the opportunity to work with a ________ again, would you? Why, or why not?