It took me a long time to truly understand the role that risk plays across the sales process. For many years I had considered how risk played a role in the decisions I was making. I worked hard to ensure I was investing the appropriate level of effort in deals. I had seen numerous otherwise talented sales people ruin entire quarters because of investing too much time and too many company resources in a deal that just didn’t have enough upside. They usually did this because they had some emotional investment in the deal and wanted to ‘see it through’, unwilling to let go of a losing stock.
But what it took me a while to get my head around was that as well as accurately assessing risk on your own side, you have to also manage risk for the individuals on the buy side. Not doing so properly can drag out deal closing times significantly or worse, leave them dead in the water. I am not necessarily talking about making the deal as financially risk free as possible. If you are able to do that then definitely do. Some deals can be positioned to limit any potential financial downside and this makes it very easy to say yes. But this is often difficult to do and even when you limit financial exposure there are still hidden costs within the buying organisation that you cannot control, mostly relating to time and focus on the project. What I am talking about is making it as easy as possible for the primary buyer(s) to promote you in front of their peers.
Why do you need to do this? Let’s get into the mind of the buyer again. As we have explored when you make a personal purchase you go through various phases of research and validation. As it is a personal purchase, you may consult with friends and family but ultimately the decision is yours. If you get it wrong, you usually only have yourself to blame and only yourself will blame you: most people can live with that. However in an enterprise there are multiple stakeholders, requirements and agendas. You need to be acutely aware of this. You probably already are.
You probably already think about the various stakeholders and their requirements so you can pitch the features and benefits of your solution to them specifically. But what I didn’t think too clearly about in the past was how to spread the risk of purchase between as many people as possible.
Let’s assume you have identified a single decision maker. This person has a very real problem (on a list of ten very real problems) and your product hits the spot. Now in order to close the deal, you need that one person to stick their head above the parapet and sign-off on you, your company and your product. The trouble is that most humans are naturally risk averse and in a competitive work environment can be even more so. Signing off on you is likely a lot of effort; they’ll have to have multiple conversations internally with people that have never heard of you and get their approval (explicit or implicit). As much as they might like your product, sometimes it just isn’t worth the risk.
However if you spread that risk around it can become a more palatable exercise. If your main contact’s boss is aware of you and what you do, it becomes an easier conversation. If your main contact’s boss and one or two of their peers know about you and have an interest in you, it becomes even easier. Ultimately the more people within the organisation that know about you (and want you), the easier it will be to close the deal because they share the risk out between them. No one is putting his or her neck on the line for you, the responsibility is spread and so is the risk.
Let’s look at a real world example when I was on the buying side. To help bolster my sales activity I frequently recommend partnering with media outlets and industry bodies. Some of the time these partnerships will be mutually beneficial. I’ll produce some content in the form of blog posts or comments on industry news and they will publicise it. In other times the relationship is of a more commercial nature: I’m paying for access to their contacts and expertise. In order to do this, I need sign off from teams responsible for the marketing budget.
Now it may sound obvious, but I was always more willing to ask for money for organisations that the marketing team were aware of. Sticking my neck out for an unknown publisher to run a marketing programme that I hadn’t deployed before was risky and I knew that if it didn’t work out or if they didn’t deliver, I would have to have a few awkward conversations internally. In some situations, if I really, really, really believed in the product, I’d be willing to take the risk. In other situations I simply wasn’t willing to take that risk. Who knows, maybe I missed out on some killer ideas but the end result is the same, those publishers did not close the business.
So if that’s how I behave when I’m the buyer, it stands to reason that other buyers out there will act in a similar manner.
So what can you do? Aside from using the strategies in this book to deliver such a great pitch for which that one person is prepared to put his or her neck on the line. There are a few activities you can undertake.
First of all, just be aware of the role that risk plays in people’s decision making. Just because something makes sense from a product or solution perspective, does not mean someone will automatically buy. There are other factors in play and starting with this frame of mind will make your job easier.
Make sure that you spend time talking to your primary buyer(s) to understand what other factors are in play, if there are any other considerations in play and what the approval process is for them to make a purchase.
Definitely remember to take advantage of what you prepared earlier. You should already have identified potential secondary stakeholders. Double-check these with your primary buyer as early as possible. Secure introduction to them once your buyer has confirmed your product is wanted. These introductions signify that the buyer is ready to move to the final phases of the deal.
Make sure you identify who within your own organisation will peer with these secondary stakeholders. Start preparing your own stakeholders for what is coming. As you are in the final phases of the deal and have gone through all the necessary steps, this should not be a problem.
Take some time to map out what you learn: actually draw it on a whiteboard so you can see it.
Finally, invest some time in making contact with as many individuals on that whiteboard as possible. As always there is no need to give chapter and verse, and you should loop in your main contact, but there is nothing wrong with dropping a quick email to some of the other stakeholders or people in the approval process introducing yourself and explaining a little about your product, your company and yourself. Then advise that you are in the final phases of a deal with their buyer and you want to get a head start. Ask them if they can provide a ‘what is going to be required’ list so you can begin preparing your own team. It is more than likely they will not have an issue with this and it is possible they will be open to providing even more – anything to make their own lives easier later on.
If you do all of the above you have gone a long way to minimising risk for your primary contact and should see deals close with much less resistance.
Check out our Advantage Plan section for quick reference guides on various aspects of the sales cycle, then move on to the next step in your sales process - committing the buyer. Alternatively, contact us and we'll figure it out together.