For me, selling is about relationships and during that process, whoever builds the strongest relationship is going to be the one who gets the sale. Why? Trust. People buy from people they like. They like people who are like themselves - and who are interested in them. They trust people who they perceive are like themselves, who consult them, and ask their views before selling to them.
Key components of consultative selling
So, hopefully the need for diagnosis is now firmly established in your mind, think of yourself in any sales or marketing situation (essentially every minute you are in business) as a doctor or a consultant. And there are three key components to any consultative selling process:
• qualifying, and
… but not necessarily in that order. With the help of another real-life example, we will now see, which order is most effective and why.
A study done with three companies - they all sold the same thing, namely their professional expertise built up over many years. The first company has a four month sales cycle and a 90% close rate. The second company has an eight month sales cycle selling the same thing, twice as long as the first company, with a 60% close rate. Third company - 14-month sales cycle and 2% close rate. Remember, all were selling the exact same professional service. But the difference was each one used a different order of the three component parts in which they organised their consultative process.
The first company was doing what we can call a ‘quid pro quo’ approach. There was a two-year study on winning in a competitive situation. They brought the best minds, game theorists, mathematicians, and all kinds of people to say, “How do you win in a competitive situation?” If you have ever played noughts and crosses then consider how do you win in that game? By going first and hoping the other person makes a mistake, right? But it is tit for tat, and it is, you go, I go.
The second company used what is known as the ‘traditional consultative approach.’ And the third one used what I call the ‘spray and pray’ - throw it out there, and see what sticks.
The company with the quid pro quo approach, which was the most successful consultative selling process, had the three ingredients in this specific order:
• Step #1 - they qualified the deal.
• Step #2 was that they closed the deal.
• And Step #3 was they presented.
The qualification was, do they have their ducks in a row? Do we understand what they want to accomplish, and all the parameters around that? Ok? The close was, “if I can do all the things based upon your parameters and what you want done, will you buy from me”? Because, if the answer to that question is, “no”, then doing a pitch or a proposal, or a price quote presentation doesn’t matter. It is over. So you are just making sure that they are ready, willing and able to make a decision before you show them anything that they need to see.
Now the second company’s sales cycle was the traditional approach is this: qualification first, presenting second, and closing third. That is a very traditional approach. It works and there is nothing wrong with it. But as you see, it is just not as effective as the first one. And the last approach, the spray and pray, is where you present - you go out and tell everybody about what you are doing and show them, right? So the order of the three ingredients in the Spray and Pray approach is, you present, then you qualify, and then you close. Three times longer sales cycle, and 40 times less effective than the Quid Pro Quo Consultative sales approach.
Why Consultative Selling works so well
So in the study of the three companies, why did the quid pro quo model deliver a 45 times higher close rate, three times faster?
I enjoy debating this with our some of our SurveyMe clients who manage successful businesses. Here's what they tell me... They prefer it when their suppliers adopt the quid pro quo approach over the traditional consultative selling process because it doesn't waste their time. Also, it is much better at facilitating and finding out what they wanted. Most say they usually always prefer to do business this way i.e. have their suppliers ask them their opinion in advance, check with them that what they are about to be supplied with is what they want. Its what as customers they themselves appreciate and is most likely to make them buy something!
Can you now relate to why asking for feedback from your customers will only improve your business?