By Ron LaVine, MBA
President of Accelerated Sales Training, Inc.
Have you ever asked yourself, what are the specific characteristics of a qualified prospect? What are the minimum pieces of information you need to know to determine if the potential for a sale exists? What pieces of information are required before you consider a prospect qualified? Am I using a consistent cold calling system to successfully obtain the information needed?
Here are the first of a four part blog on 17 areas with questions you may want to ask yourself so you can create a qualified prospect profile also known as an Account Sales Profile™.
1. Basic Demographics
Ask yourself "Which type of organization do I make the most money when I make a sale?" For example: Is it a company with 10 employees or 100 employees? Does the company have over $10 million in gross sales or over $100 million in gross sales? Are most of my customers in the Retail Industry or the Financial Industry? What types of organizations will provide the highest payoff in return for my limited amount of selling time?
In summary, what are the demographics of your most profitable accounts in terms of...
> Industry Verticals (such as Software, Printing, Frozen Foods, etc.)
> Total Gross Sales
> Total Number of Employees
2. Business Practices
How does the account currently conduct business?
Where is the Prospect now?
How did the Prospect conduct business in the past?
What is the Prospect's future strategic direction?
Where does the Prospect want to be?
How does the Prospect plan to get there?
3. Needs, Problems, Challenges, Critical Business Issues, Pains or Drivers
Is there a perceived or unperceived need for your solution?
What are the needs, challenges or problems the Prospect facing?
What is keeping them up at night?
What is required to solve the problem and does your solution fit the bill?
Is the Prospect actively searching for a solution, which you can provide?
Does the Prospect have any current or future business initiatives?
Has the Prospect expressed an interest in what you have to offer?
Does the Prospect have a compelling business issue that needs to be solved?
Is the Prospect using outdated products and services, which may need to be replaced?
Is there a need for a specific product or service but the Prospect can't afford the time or money or man hours to build their own solution?
Is the Prospect using some type of solution and not yet seeing business results?
Is the Prospect starting to look at competitors?
Has a specific person been assigned to find a solution to a specific need?
Does the Prospect have a serious intention to buy or are they just being time wasters or tire kickers or a just send me something?
4. Time-frames
What are the time-frames for...
The RFI or RFP or RFQ (Request for Information, Proposal or Quote)
Evaluation period
Decision date
Roll-out of a pilot solution
Implementation of an enterprise wide solution
5. Budget
Does the Prospect have a budget already set aside?
Can the Prospect get it from someone else's budget or next year's budget?
At what level are further sign-offs required? ($10,000, $50,000? 100,000?)
What amount is budgeted for a solution?
Is there a deadline where the Prospect will lose the budget or funding (usually in schools or government organizations)?
More on What Makes a Qualified Prospect, Qualified? next week.
Showing posts with label sales. Show all posts
Showing posts with label sales. Show all posts
Sunday, May 22, 2011
Sunday, October 24, 2010
Best Practices of Successful Software Company Salespeople
A study of the best practices of successful software company salespeople, conducted by the executive search firm Spencer Stuart in conjunction with Software Magazine, has found that the most important ingredients of success are a quality product and an effective sales force. But more compelling is evidence that the long-heralded team-selling concept has taken root. The most successful companies consistently put together highly trained teams to help their customers understand the benefits of their products.
The most successful enterprise software companies focus on building relationships with executives at Fortune 500 companies, and they use a “best team” approach to partner with these companies. This teaming can take many flavors, such as inside sales working with outside sales and channel partners to drive revenues, or product specialists overlaying revenue-focused sales reps. But the bottom line is that the most successful software companies have moved away from the “lone wolf" sales rep model to an approach founded on teamwork.
While this might not seem like earth-shattering news, it does point to the need for software suppliers interested in reaching their revenue targets to focus on the quality of their products, and to invest in helping their sales forces use approaches that do not turn IT managers off. IT managers should insist that the salespeople representing their software suppliers study the best practices of their counterparts in other firms to avoid losing business by engaging in IT management “turnoffs.”
These include: not delivering on promised products, making exaggerated or outright false claims, not bringing the right skills or expertise to bear on the customer’s problems, or avoiding accountability if a product is proving difficult to implement or use. “They have got to listen to what we say,” says Nancy Bryant, ClO with First City Savings Federal Credit Union in Glendale, Calif. “Sometimes you say you’re not interested and they still want to come out and show you things.”
Bryant has had a pleasant experience recently with sales efforts of (www.dartware.com), which offers the InterMapper tool for system monitoring. When the sales operation called and asked if Bryant needed new monitoring software, she said yes, and they explained what they could do for her. When she had a question, they e-mailed her back an answer in a timely manner. Later she received a follow-up phone call. “We are going to purchase the product,” she says.
Other tips from Bryant for software company salespeople included:
> Be knowledgeable about your product, or have a technical person available who can answer questions. “You can tell if they are reading a script and have no clue,” she says.
> Avoid annoying persistence. “When they call up and I say I don’t need it, then they send me priority mail and ask me what I think of it, when I didn’t ask for it, it’s annoying,” Bryant says.
> Explain how the product will save time or money, or make the IT buyer more efficient.
The best sales forces operate as a team; quality products, good training and fair compensation help; Software Company CEOs value leadership and a good attitude “I appreciate hearing about new things. I don’t want salespeople to stop calling. I just like them to listen when I say no and be able to answer basic questions,” Bryant says.
Software Industry Challenges Salespeople
The software industry is a challenging one to sell products in, because the products are highly technical. It is often difficult for a salesperson to articulate their value to prospective customers. This is especially true when application package suppliers try to sell to business professionals with little technical background. Many software markets are crowded with competitors and extremely fragmented. The barriers to entry are low for new software companies, and large enterprises are willing to buy from startups if they make compelling cases for their products. And the best products do not always win.
The sales force facing the IT buyer has much to do with the success of the software supplier. By company size, 27% of the software companies participating in the study had revenues of more than $1 billion; 40%, over $500 million; and 33%, under $500 million. Distribution by position was 43% CEOs or general managers and the rest sales executives. Industries producing the most revenue for participating suppliers were technology and communications, financial services, industrial, consumer goods and services, energy and process, and life sciences.
Other Key Findings of the Study
The quality of first-line sales managers and sales leadership are the most critical factors contributing to the overall effectiveness of the sales force. Sales executives attached more importance to compensation than did CEOs and general managers of the software suppliers.
While channel partners are growing in importance, person-to-person direct sales is still how most enterprise software suppliers take their product to market. On pricing, management and not the sales rep makes the key decisions. The productivity of the sales organization is primarily a function of two issues: the ability to recruit the right people, and training to upgrade the knowledge of the sales force.
Also, CEOs are frustrated when their sales teams don’t call at a high enough level in their customer organizations to drive decisions. This explains why sales reps keep trying to get to the boss. Internally, software firms have worked hard to integrate their sales teams with technical support, professional services, and the senior executive team. This partnering with professional services is driven by many software firms transitioning from a product sale to a solution sale.
However, they concede that they have not built strong bridges to the engineering and product development organizations, nor to the customer service organization. Product development may not always be working closely enough with sales to get an accurate view of what customers need. And the lack of integration with the customer resource management, customer services, and sales force automation suggests that those areas have not lived up to their promise.
On Some Issues, Views of CEOs and Their Sales Execs Differ
Software CEOs and sales executives agreed on many of the determinants of success, such as the product quality, quality of the first-line sales managers, and their ability to hire and organize effective sales teams. However, they did look at some issues differently. CEOs felt more strongly that the ability of their sales teams to penetrate top level executives in their customer organizations was critical, a view not expressed as strongly by the sales executives. Conversely, those sales executives were more focused on the compensation plan, both as a tool to recruit top performers, as well as a way to motivate their teams once hired.
CEOs and sales executives agreed that the ability to create effective teams was one of the most important ways of outperforming their competitors. Equally important is their ability to field a highly technically competent field organization.
Reprinted with permission. Software Magazine Summer 2002 Issue - Page 21 – 22. Accelerated Sales Training, Inc. www.AST-incorp.com send mailto:info@AST-incorp.com.
The most successful enterprise software companies focus on building relationships with executives at Fortune 500 companies, and they use a “best team” approach to partner with these companies. This teaming can take many flavors, such as inside sales working with outside sales and channel partners to drive revenues, or product specialists overlaying revenue-focused sales reps. But the bottom line is that the most successful software companies have moved away from the “lone wolf" sales rep model to an approach founded on teamwork.
While this might not seem like earth-shattering news, it does point to the need for software suppliers interested in reaching their revenue targets to focus on the quality of their products, and to invest in helping their sales forces use approaches that do not turn IT managers off. IT managers should insist that the salespeople representing their software suppliers study the best practices of their counterparts in other firms to avoid losing business by engaging in IT management “turnoffs.”
These include: not delivering on promised products, making exaggerated or outright false claims, not bringing the right skills or expertise to bear on the customer’s problems, or avoiding accountability if a product is proving difficult to implement or use. “They have got to listen to what we say,” says Nancy Bryant, ClO with First City Savings Federal Credit Union in Glendale, Calif. “Sometimes you say you’re not interested and they still want to come out and show you things.”
Bryant has had a pleasant experience recently with sales efforts of (www.dartware.com), which offers the InterMapper tool for system monitoring. When the sales operation called and asked if Bryant needed new monitoring software, she said yes, and they explained what they could do for her. When she had a question, they e-mailed her back an answer in a timely manner. Later she received a follow-up phone call. “We are going to purchase the product,” she says.
Other tips from Bryant for software company salespeople included:
> Be knowledgeable about your product, or have a technical person available who can answer questions. “You can tell if they are reading a script and have no clue,” she says.
> Avoid annoying persistence. “When they call up and I say I don’t need it, then they send me priority mail and ask me what I think of it, when I didn’t ask for it, it’s annoying,” Bryant says.
> Explain how the product will save time or money, or make the IT buyer more efficient.
The best sales forces operate as a team; quality products, good training and fair compensation help; Software Company CEOs value leadership and a good attitude “I appreciate hearing about new things. I don’t want salespeople to stop calling. I just like them to listen when I say no and be able to answer basic questions,” Bryant says.
Software Industry Challenges Salespeople
The software industry is a challenging one to sell products in, because the products are highly technical. It is often difficult for a salesperson to articulate their value to prospective customers. This is especially true when application package suppliers try to sell to business professionals with little technical background. Many software markets are crowded with competitors and extremely fragmented. The barriers to entry are low for new software companies, and large enterprises are willing to buy from startups if they make compelling cases for their products. And the best products do not always win.
The sales force facing the IT buyer has much to do with the success of the software supplier. By company size, 27% of the software companies participating in the study had revenues of more than $1 billion; 40%, over $500 million; and 33%, under $500 million. Distribution by position was 43% CEOs or general managers and the rest sales executives. Industries producing the most revenue for participating suppliers were technology and communications, financial services, industrial, consumer goods and services, energy and process, and life sciences.
Other Key Findings of the Study
The quality of first-line sales managers and sales leadership are the most critical factors contributing to the overall effectiveness of the sales force. Sales executives attached more importance to compensation than did CEOs and general managers of the software suppliers.
While channel partners are growing in importance, person-to-person direct sales is still how most enterprise software suppliers take their product to market. On pricing, management and not the sales rep makes the key decisions. The productivity of the sales organization is primarily a function of two issues: the ability to recruit the right people, and training to upgrade the knowledge of the sales force.
Also, CEOs are frustrated when their sales teams don’t call at a high enough level in their customer organizations to drive decisions. This explains why sales reps keep trying to get to the boss. Internally, software firms have worked hard to integrate their sales teams with technical support, professional services, and the senior executive team. This partnering with professional services is driven by many software firms transitioning from a product sale to a solution sale.
However, they concede that they have not built strong bridges to the engineering and product development organizations, nor to the customer service organization. Product development may not always be working closely enough with sales to get an accurate view of what customers need. And the lack of integration with the customer resource management, customer services, and sales force automation suggests that those areas have not lived up to their promise.
On Some Issues, Views of CEOs and Their Sales Execs Differ
Software CEOs and sales executives agreed on many of the determinants of success, such as the product quality, quality of the first-line sales managers, and their ability to hire and organize effective sales teams. However, they did look at some issues differently. CEOs felt more strongly that the ability of their sales teams to penetrate top level executives in their customer organizations was critical, a view not expressed as strongly by the sales executives. Conversely, those sales executives were more focused on the compensation plan, both as a tool to recruit top performers, as well as a way to motivate their teams once hired.
CEOs and sales executives agreed that the ability to create effective teams was one of the most important ways of outperforming their competitors. Equally important is their ability to field a highly technically competent field organization.
Reprinted with permission. Software Magazine Summer 2002 Issue - Page 21 – 22. Accelerated Sales Training, Inc. www.AST-incorp.com send mailto:info@AST-incorp.com.
Friday, October 1, 2010
How To Use the Six Laws of Persuasion during a Negotiation
How To Use the Six Laws of Persuasion during a Negotiation
By Edrie Greer, Ph.D.,
Global Knowledge Instructor
Introduction
To get what you want in life, in work, and in play, requires constant negotiation with a variety of people. This involves basic communication skills, such as active listening and attention to non-verbal cues, and a clear understanding of your goals, as well as the objectives of your negotiating partner(s). To be truly effective, however, you need to know more. You should be able to communicate persuasively during the process of negotiation. Many situations you'll face as IT managers and employees will require you to effectively negotiate to a mutually beneficial (win-win) solution, including:
1. Responding to staff members' requests for promotions, salary increases, and other employment perks (as well as negotiating your own)
2. Negotiating with vendors for their best possible products, services, and prices
3. Convincing your team to do what you would like them to do
4. Working with external and internal clients on contracts (such as Service Level Agreements) that provide the quality services and equipment they need but in a manner that allows you to use your resources optimally
5. Persuading supervisors to buy additional equipment, accept your budget proposals, try a new idea, etc. In order to be successful in these instances, you must master the persuasion process, which will enable you to deliberately create the attitude change and subsequent actions necessary for persuading others to your way of thinking. In other words, you have to be able to "sell" your ideas in order to make changes in your favor and, in a win-win situation, provide the other side with a fair deal. This entails a process that can appeal to the intellect using logical and objective criteria, as well as a methodology that positively engages the emotions of the negotiators. The result of a successful negotiation is that all parties should believe they got a good deal.
The Six Laws of Persuasion: an Overview
Persuasion is the ability to influence people's thoughts and actions through specific strategies. To become adept at this skill, you must first understand some basic principles, called the Laws of Persuasion. These six laws by themselves are neither good nor bad, but describe how most people respond to certain circumstances.
Psychologist Robert Cialdini wrote the seminal book on the Laws of Persuasion, titled Influence: The Psychology of Persuasion, in which he discusses the prevalent methods of marketing. Even though you may not wish to believe it, a great deal of psychological research indicates that human beings are quite predictable in terms of behavior in response to certain stimuli, such as ads. This is why marketing and advertising are highly successful enterprises-by and large, consumers respond to most ads and commercials by buying the products and services they promote. By understanding persuasion laws, you can control how much others unduly influence you, as well as how to use them to your benefit during negotiations.
How To Use the Six Laws of Persuasion during a Negotiation
The laws work because they provide shortcuts to making the countless decisions people face every day as they look for information to reduce the complexity of life. If you can apply these laws in specific situations to your benefit, then your influence over others increases significantly. Some of the best masters of the art of persuasion in negotiation are highly successful salespeople who do their best not only to make the sale, but also to meet the needs of their buyers.
Here are Cialdini's Six Laws of Persuasion:
Law of Reciprocity
Human beings, in general, try to repay in kind what another person has provided to them. If someone gives you something you want (or perhaps didn't "realize" you wanted), then you will wish to reciprocate because you now feel obligated. Examples of this Law include the address labels you receive in the mail from various non-profits requesting charitable contributions. Even though they are a minor, unsolicited gift, sending them has increased contributions for non-profits many-fold, because people feel compelled to return the favor. Giving free samples to potential customers is another way in which this Law is used by successful salespeople.
Law of Commitment and Consistency
People like to be (or at least appear to be) consistent in their thoughts, feelings, and actions. Once they have made a stand, they tend to stick to it and behave in ways that justify their earlier decisions, even if they are erroneous. If you make a commitment to a cause or product, however small, it then becomes easier to be convinced to increase it. This is especially true if the commitment changes your view of yourself in a favorable way. This is why salespersons attempt to get customers to agree with them multiple times. After saying yes so often, it is almost impossible to say no when it comes time for the close or direct request for the sale.
Law of Liking
When you like someone, or believe that they are "just like you," you are more inclined to want to please them and, therefore, purchase whatever they are selling. This is how successful salespeople operate; they establish rapport by demonstrating how similar they are to their potential buyers. For example, they note that they are from a comparable background as you, or even better, they are people you know-your friends. As for those in-home sales parties, the kicker comes when your neighbors provide the testimonials for the product. You don't want to disappoint them by not purchasing, do you?
Law of Scarcity
If you are not sure you want to buy something, the minute it becomes "the last one available" you tend to have second thoughts. After all, this must indicate that others are purchasing it, and you might not be able to get another one quickly, or at all, if you decide you want it later. So you take the bait to buy a popular item that others won't be able to get. At least that's what you think.
Law of Authority
This is the law that uses celebrity endorsements or "expert" testimonials. When people you admire promote a product or service, if it's good enough for them, then it's good enough for you. And if you use it, then you might even develop similar characteristics to your heroes, such as good looks, wealth, or fame. That's what the advertisers are counting on.
Law of Social Proof
Why have TV sitcoms used canned laugh tracks for years? Producers wouldn't employ them unless they actually are successful in eliciting audience laughter and, subsequently, higher ratings. Part of the reason you laugh along anyway in spite of your annoyance lies in how you decide what is socially "correct" behavior. If you don't know exactly what to do, you rely on others around you (or the virtual TV audience) to help you find the way to properly react. You think if others are engaging in a specific behavior, it must be the proper thing to do. Hence, you laugh in spite of yourself, or if you're told that "everyone is buying this product or service," even without evidence, you may think you're missing out if you don't comply or conform and get it for yourself.
Using the Laws of Persuasion
As mentioned, in any negotiation, all parties should arrive at a conclusion that makes them feel like they got a good deal, especially if an on-going relationship is involved. (Note: a "good deal" is not always the same for everyone; negotiators often have different criteria by which they judge the success of their bargaining outcomes.)
Often when dealing with "tough" or "hard" negotiators, you encounter manipulative tactics that use the preceding Laws of Persuasion. So how do you successfully negotiate around these ploys? First, you can discuss the rules of the game. When you recognize that the other side is using one or more of the Laws of Persuasion, you can either directly note it, or simply steer the conversation to a more objective solution. And for the ultimate in law prevention, you can set preconditions ahead of time that will preclude such strategies by using only logical principles as a standard process in the negotiation.
Negotiation strategies using the Six Laws of Persuasion include the following:
Law of Reciprocity
Limited disclosure/confession of the real reason for a negotiation stance, such as "this is all the money we have," can provoke a concession from the other party. (This is often seen in salary/promotion negotiations.) Concessions in general follow this "tit-for-tat" rule (the lower the "value" of the concession on your part, of course, the better). You can also use this law to appeal to fairness. For example, if the other party manipulates the physical environment by requiring that your team sits facing the sun, at the next meeting they should reciprocate.
Law of Commitment and Consistency
An example of this tactic would be using a series of questions to conduct the step-by-step close. Dale Carnegie, in How to Win Friends and Influence People, called this, "Get the other person saying 'yes, yes' immediately." This occurs when one party asks the other side to make a number of "small" decisions that lead to only one obvious conclusion: to accept the general concession. You could employ this principle by asking a potential client if she values quality in your product or service. Of course the only answer would be "yes." Then you could follow with a question that begs the obvious: "We'd love to provide you with this product/service, but if we don't get the resources we need from you (i. e. sufficient money) and quality suffers as a result, would you still want it?" How can the prospect say "yes" to poor quality? This tactic makes it easier for you to ask for additional funds.
You might also see an example of this ploy when lowballing (intentional last-minute additions to what was originally a low price) occurs. Unscrupulous vendors might attempt to make you psychologically "invest" in a product that you initially believe costs less.
Law of Liking
This law is often seen in the strategy of "good cop, bad cop," where one person in the other negotiating party is clearly opposed to your objectives, but it appears that another of their team members is "on your side." This causes you to identify with and trust the "good" team member, so you may find yourself agreeing to the other team's concessions and goals instead of your own. You can see this in situations where a salesperson "battles" their supervisor to get you a "better" deal (of course this was the result they wanted in the first place). You might also apply this law to establish rapport up front when you are negotiating with your own superiors or teams.
Law of Scarcity
The more time you spend with a salesperson, the more commitment he or she has to make the deal. If you are under no time pressure and the other side is, you have the upper hand.
Law of Authority
Vendors often quote vague authorities to sell their wares, "Experts say our product is the best." But who are these experts? What are their qualifications to make these claims? Do they have a vested interest in selling the company's products or services? In addition, use this Law to establish your own credentials/credibility early in the negotiation.
Law of Social Proof
This law works when you draw on testimonials from satisfied customers or clients (unscripted ones are best) to encourage new prospects to buy your services and products. The law also can be used to convince your supervisors or staff that their counterparts in other divisions or companies are following similar suggestions to yours. People want to feel like they are part of an established community that already knows where it is going.
Ethical Issues
Persuasion can be used for good or ill. In an environment that seeks to follow ethical rules, it should only be used to make lives better. Manipulation occurs when you exploit or deceive others solely for your own gain. This does not result in a win-win situation.
Summary
Being adept at persuasion is often the missing key to success in the workplace and your personal life. If you give people what they want via the Six Laws of Persuasion, they'll most likely return the favor. And when you recognize that you are being manipulated, you can call the other side on their tactics and counter with an appropriate strategy. This will lead to a more effective way of achieving the goals of all negotiating parties.
Learn More
Learn more about how you can improve productivity, enhance efficiency, and sharpen your competitive edge. Check out the following Global Knowledge course: Communication and Negotiation Skills. For more information or to register, visit http://www.globalknowledge.com/
or call 1-866-925-7765.
About the Author
Dr. Edrie Greer is President of Learning, ETC, Inc., which provides Educational, Training, and Communications services to organizations. She brings more than 20 years of experience in adult education, instructional design, educational technology, instructor development, and media production to her work. Dr. Greer holds a Ph. D. in the Sociology of Religion from the New Thought Theological Seminary, a Master of Science in Continuing and Vocational Education and a Bachelor of Science in Life Sciences Communication from the University of Wisconsin-Madison.
Sources
Carnegie, Dale. How to Win Friends and Influence People. New York: Pocket Books, 1936. Cialdini, Robert B. Influence: The Psychology of Persuasion. New York: William Morrow, 1993. Fisher, Roger and William Ury. Getting to Yes: Negotiating Agreement Without Giving In. New York: Penguin, 2003. Hogan, Kevin. The Psychology of Persuasion: How to Persuade Others to Your Way of Thinking. Gretna, LA: Pelican, 1996.
Hope you found this informative, see you next time.
Until then. . .
Make it a great day and a successful week!
Ron
--
Make it a great day and a successful week!
Ron S. La Vine, MBA, President and CEO
Accelerated Sales Training, Inc.
Helping you Get Into New and Existing Accounts and Get New Business™
http://www.ast-incorp.com
Complementary Sales Tips
http://www.ast-incorp.com/free.htm
Join me at LinkedIn
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Accelerated Sales Training, Inc.
638 Lindero Canyon Road, Suite 283
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818-991-5938 Fax
mailto:rslavine@ast-incorp.com
By Edrie Greer, Ph.D.,
Global Knowledge Instructor
Introduction
To get what you want in life, in work, and in play, requires constant negotiation with a variety of people. This involves basic communication skills, such as active listening and attention to non-verbal cues, and a clear understanding of your goals, as well as the objectives of your negotiating partner(s). To be truly effective, however, you need to know more. You should be able to communicate persuasively during the process of negotiation. Many situations you'll face as IT managers and employees will require you to effectively negotiate to a mutually beneficial (win-win) solution, including:
1. Responding to staff members' requests for promotions, salary increases, and other employment perks (as well as negotiating your own)
2. Negotiating with vendors for their best possible products, services, and prices
3. Convincing your team to do what you would like them to do
4. Working with external and internal clients on contracts (such as Service Level Agreements) that provide the quality services and equipment they need but in a manner that allows you to use your resources optimally
5. Persuading supervisors to buy additional equipment, accept your budget proposals, try a new idea, etc. In order to be successful in these instances, you must master the persuasion process, which will enable you to deliberately create the attitude change and subsequent actions necessary for persuading others to your way of thinking. In other words, you have to be able to "sell" your ideas in order to make changes in your favor and, in a win-win situation, provide the other side with a fair deal. This entails a process that can appeal to the intellect using logical and objective criteria, as well as a methodology that positively engages the emotions of the negotiators. The result of a successful negotiation is that all parties should believe they got a good deal.
The Six Laws of Persuasion: an Overview
Persuasion is the ability to influence people's thoughts and actions through specific strategies. To become adept at this skill, you must first understand some basic principles, called the Laws of Persuasion. These six laws by themselves are neither good nor bad, but describe how most people respond to certain circumstances.
Psychologist Robert Cialdini wrote the seminal book on the Laws of Persuasion, titled Influence: The Psychology of Persuasion, in which he discusses the prevalent methods of marketing. Even though you may not wish to believe it, a great deal of psychological research indicates that human beings are quite predictable in terms of behavior in response to certain stimuli, such as ads. This is why marketing and advertising are highly successful enterprises-by and large, consumers respond to most ads and commercials by buying the products and services they promote. By understanding persuasion laws, you can control how much others unduly influence you, as well as how to use them to your benefit during negotiations.
How To Use the Six Laws of Persuasion during a Negotiation
The laws work because they provide shortcuts to making the countless decisions people face every day as they look for information to reduce the complexity of life. If you can apply these laws in specific situations to your benefit, then your influence over others increases significantly. Some of the best masters of the art of persuasion in negotiation are highly successful salespeople who do their best not only to make the sale, but also to meet the needs of their buyers.
Here are Cialdini's Six Laws of Persuasion:
Law of Reciprocity
Human beings, in general, try to repay in kind what another person has provided to them. If someone gives you something you want (or perhaps didn't "realize" you wanted), then you will wish to reciprocate because you now feel obligated. Examples of this Law include the address labels you receive in the mail from various non-profits requesting charitable contributions. Even though they are a minor, unsolicited gift, sending them has increased contributions for non-profits many-fold, because people feel compelled to return the favor. Giving free samples to potential customers is another way in which this Law is used by successful salespeople.
Law of Commitment and Consistency
People like to be (or at least appear to be) consistent in their thoughts, feelings, and actions. Once they have made a stand, they tend to stick to it and behave in ways that justify their earlier decisions, even if they are erroneous. If you make a commitment to a cause or product, however small, it then becomes easier to be convinced to increase it. This is especially true if the commitment changes your view of yourself in a favorable way. This is why salespersons attempt to get customers to agree with them multiple times. After saying yes so often, it is almost impossible to say no when it comes time for the close or direct request for the sale.
Law of Liking
When you like someone, or believe that they are "just like you," you are more inclined to want to please them and, therefore, purchase whatever they are selling. This is how successful salespeople operate; they establish rapport by demonstrating how similar they are to their potential buyers. For example, they note that they are from a comparable background as you, or even better, they are people you know-your friends. As for those in-home sales parties, the kicker comes when your neighbors provide the testimonials for the product. You don't want to disappoint them by not purchasing, do you?
Law of Scarcity
If you are not sure you want to buy something, the minute it becomes "the last one available" you tend to have second thoughts. After all, this must indicate that others are purchasing it, and you might not be able to get another one quickly, or at all, if you decide you want it later. So you take the bait to buy a popular item that others won't be able to get. At least that's what you think.
Law of Authority
This is the law that uses celebrity endorsements or "expert" testimonials. When people you admire promote a product or service, if it's good enough for them, then it's good enough for you. And if you use it, then you might even develop similar characteristics to your heroes, such as good looks, wealth, or fame. That's what the advertisers are counting on.
Law of Social Proof
Why have TV sitcoms used canned laugh tracks for years? Producers wouldn't employ them unless they actually are successful in eliciting audience laughter and, subsequently, higher ratings. Part of the reason you laugh along anyway in spite of your annoyance lies in how you decide what is socially "correct" behavior. If you don't know exactly what to do, you rely on others around you (or the virtual TV audience) to help you find the way to properly react. You think if others are engaging in a specific behavior, it must be the proper thing to do. Hence, you laugh in spite of yourself, or if you're told that "everyone is buying this product or service," even without evidence, you may think you're missing out if you don't comply or conform and get it for yourself.
Using the Laws of Persuasion
As mentioned, in any negotiation, all parties should arrive at a conclusion that makes them feel like they got a good deal, especially if an on-going relationship is involved. (Note: a "good deal" is not always the same for everyone; negotiators often have different criteria by which they judge the success of their bargaining outcomes.)
Often when dealing with "tough" or "hard" negotiators, you encounter manipulative tactics that use the preceding Laws of Persuasion. So how do you successfully negotiate around these ploys? First, you can discuss the rules of the game. When you recognize that the other side is using one or more of the Laws of Persuasion, you can either directly note it, or simply steer the conversation to a more objective solution. And for the ultimate in law prevention, you can set preconditions ahead of time that will preclude such strategies by using only logical principles as a standard process in the negotiation.
Negotiation strategies using the Six Laws of Persuasion include the following:
Law of Reciprocity
Limited disclosure/confession of the real reason for a negotiation stance, such as "this is all the money we have," can provoke a concession from the other party. (This is often seen in salary/promotion negotiations.) Concessions in general follow this "tit-for-tat" rule (the lower the "value" of the concession on your part, of course, the better). You can also use this law to appeal to fairness. For example, if the other party manipulates the physical environment by requiring that your team sits facing the sun, at the next meeting they should reciprocate.
Law of Commitment and Consistency
An example of this tactic would be using a series of questions to conduct the step-by-step close. Dale Carnegie, in How to Win Friends and Influence People, called this, "Get the other person saying 'yes, yes' immediately." This occurs when one party asks the other side to make a number of "small" decisions that lead to only one obvious conclusion: to accept the general concession. You could employ this principle by asking a potential client if she values quality in your product or service. Of course the only answer would be "yes." Then you could follow with a question that begs the obvious: "We'd love to provide you with this product/service, but if we don't get the resources we need from you (i. e. sufficient money) and quality suffers as a result, would you still want it?" How can the prospect say "yes" to poor quality? This tactic makes it easier for you to ask for additional funds.
You might also see an example of this ploy when lowballing (intentional last-minute additions to what was originally a low price) occurs. Unscrupulous vendors might attempt to make you psychologically "invest" in a product that you initially believe costs less.
Law of Liking
This law is often seen in the strategy of "good cop, bad cop," where one person in the other negotiating party is clearly opposed to your objectives, but it appears that another of their team members is "on your side." This causes you to identify with and trust the "good" team member, so you may find yourself agreeing to the other team's concessions and goals instead of your own. You can see this in situations where a salesperson "battles" their supervisor to get you a "better" deal (of course this was the result they wanted in the first place). You might also apply this law to establish rapport up front when you are negotiating with your own superiors or teams.
Law of Scarcity
The more time you spend with a salesperson, the more commitment he or she has to make the deal. If you are under no time pressure and the other side is, you have the upper hand.
Law of Authority
Vendors often quote vague authorities to sell their wares, "Experts say our product is the best." But who are these experts? What are their qualifications to make these claims? Do they have a vested interest in selling the company's products or services? In addition, use this Law to establish your own credentials/credibility early in the negotiation.
Law of Social Proof
This law works when you draw on testimonials from satisfied customers or clients (unscripted ones are best) to encourage new prospects to buy your services and products. The law also can be used to convince your supervisors or staff that their counterparts in other divisions or companies are following similar suggestions to yours. People want to feel like they are part of an established community that already knows where it is going.
Ethical Issues
Persuasion can be used for good or ill. In an environment that seeks to follow ethical rules, it should only be used to make lives better. Manipulation occurs when you exploit or deceive others solely for your own gain. This does not result in a win-win situation.
Summary
Being adept at persuasion is often the missing key to success in the workplace and your personal life. If you give people what they want via the Six Laws of Persuasion, they'll most likely return the favor. And when you recognize that you are being manipulated, you can call the other side on their tactics and counter with an appropriate strategy. This will lead to a more effective way of achieving the goals of all negotiating parties.
Learn More
Learn more about how you can improve productivity, enhance efficiency, and sharpen your competitive edge. Check out the following Global Knowledge course: Communication and Negotiation Skills. For more information or to register, visit http://www.globalknowledge.com/
or call 1-866-925-7765.
About the Author
Dr. Edrie Greer is President of Learning, ETC, Inc., which provides Educational, Training, and Communications services to organizations. She brings more than 20 years of experience in adult education, instructional design, educational technology, instructor development, and media production to her work. Dr. Greer holds a Ph. D. in the Sociology of Religion from the New Thought Theological Seminary, a Master of Science in Continuing and Vocational Education and a Bachelor of Science in Life Sciences Communication from the University of Wisconsin-Madison.
Sources
Carnegie, Dale. How to Win Friends and Influence People. New York: Pocket Books, 1936. Cialdini, Robert B. Influence: The Psychology of Persuasion. New York: William Morrow, 1993. Fisher, Roger and William Ury. Getting to Yes: Negotiating Agreement Without Giving In. New York: Penguin, 2003. Hogan, Kevin. The Psychology of Persuasion: How to Persuade Others to Your Way of Thinking. Gretna, LA: Pelican, 1996.
Hope you found this informative, see you next time.
Until then. . .
Make it a great day and a successful week!
Ron
--
Make it a great day and a successful week!
Ron S. La Vine, MBA, President and CEO
Accelerated Sales Training, Inc.
Helping you Get Into New and Existing Accounts and Get New Business™
http://www.ast-incorp.com
Complementary Sales Tips
http://www.ast-incorp.com/free.htm
Join me at LinkedIn
http://www.linkedin.com/in/ronlavine
Accelerated Sales Training, Inc.
638 Lindero Canyon Road, Suite 283
Oak Park, CA 91377
818-519-3852 Mobile
818-991-5938 Fax
mailto:rslavine@ast-incorp.com
Thursday, August 19, 2010
Why is the telephone like a violin?
Imagine an orchestra playing before you. Now think what would happen if one of the violin players suddenly ignored the what the composer had written on the sheet music started playing another tune right during the middle of another piece. Or what if the violin player kept their instrument aloft and accidentally played a note or two?
What would happen? At the very least, the harmony would end. Why? The person was not paying attention or was intent on making themselves heard.
Now imagine being on the telephone having a conversation with a prospect when all of a sudden instead of listening to what is being said to you, you decide you must start talking about all the features and benefits you feel the prospect must know about your technology. Instead of continuing to listen and discuss what is important to the prospect, you interrupt thinking if only they knew how great your technology is they would buy immediately.
Let's go back to our orchestra scenario. What happens when a violinist decides to play another piece or accidentally plays a note during the middle of a piece? Similar to the disharmony they would cause, you would probably end up with something equally bad. This maybe the loss of a sale and possibly damaging any future relationship.
The telephone is similar to a violin. It is an instrument. It takes practice to learn how to derive the most benefits from using it. When you learn how to play the violin, unless you are a prodigy born with innate talent, you need to practice following what the composer has written (or in the case of a conversation, listening to what the prospect is saying without interrupting).
This can and is a real challenge for many of us. Why? We like to hear ourselves speak. We like to share all of what we know.
While on the telephone, one of the ways you can prevent this is to place a finger over your mouth reminding yourself that your job at this point is to listen and not speak. This serves four purposes.
One, it is very difficult to talk when your finger is covering your mouth.
Two, it will remind you to listen (and concentrate) more and while speaking less.
Three, you will begin to become conscious of your need to speak.
Four, you will be able to learn how to control your urge to speak.
This is a simple yet useful technique to force yourself to get in the habit of listening.
Using the telephone to make sales requires discipline. Since you cannot see the other person and therefore cannot rely upon visual signs, you must rely solely upon what you hear. Decide to listen. STOP! Stop talking on purpose.
Encourage the person to answer each question in detail by remaining silent. Remember that silence often gives the person on the other end of the line time to think about an answer to your question. If you interrupt them, you may never know what important piece of information they were going to tell you.
Allow them time to think, you will get more information that way, rather than trying to fill in the gaps of silence. Show you are listening by using statements such as "I see" or "I hear you" "Okay" "I understand what you mean" or "Right." If you overlook this step, misunderstandings can come back to haunt you later.
Have you ever watched an orchestra when a group of instruments are not playing or are not getting ready to play? What do they do? Typically they put their instruments down or away from their mouths. Why do you think they do this? Could it be so they don't accidentally play a note and ruin the piece that is being played?
Control your urge to speak and you will make more sales. Remember, the secret to listening is to be interested, not interesting.
--
Make it a great day and a successful week!
Ron S. La Vine, MBA, President
Accelerated Sales Training, Inc.'s -
Live Cold Call New Business Development Sales Training™
Helping you Break into Large Accounts™
638 Lindero Canyon Road, Suite 283
Oak Park, CA 91377
818-991-6487 Office PST
818-519-3852 Mobile
818-991-5938 Fax
mailto:rslavine@ast-incorp.com
http://www.ast-incorp.com
Complimentary Sales Tips -
http://www.ast-incorp.com.com/free.htm
Join me at LinkedIn -
http://www.linkedin.com/in/ronlavine
What would happen? At the very least, the harmony would end. Why? The person was not paying attention or was intent on making themselves heard.
Now imagine being on the telephone having a conversation with a prospect when all of a sudden instead of listening to what is being said to you, you decide you must start talking about all the features and benefits you feel the prospect must know about your technology. Instead of continuing to listen and discuss what is important to the prospect, you interrupt thinking if only they knew how great your technology is they would buy immediately.
Let's go back to our orchestra scenario. What happens when a violinist decides to play another piece or accidentally plays a note during the middle of a piece? Similar to the disharmony they would cause, you would probably end up with something equally bad. This maybe the loss of a sale and possibly damaging any future relationship.
The telephone is similar to a violin. It is an instrument. It takes practice to learn how to derive the most benefits from using it. When you learn how to play the violin, unless you are a prodigy born with innate talent, you need to practice following what the composer has written (or in the case of a conversation, listening to what the prospect is saying without interrupting).
This can and is a real challenge for many of us. Why? We like to hear ourselves speak. We like to share all of what we know.
While on the telephone, one of the ways you can prevent this is to place a finger over your mouth reminding yourself that your job at this point is to listen and not speak. This serves four purposes.
One, it is very difficult to talk when your finger is covering your mouth.
Two, it will remind you to listen (and concentrate) more and while speaking less.
Three, you will begin to become conscious of your need to speak.
Four, you will be able to learn how to control your urge to speak.
This is a simple yet useful technique to force yourself to get in the habit of listening.
Using the telephone to make sales requires discipline. Since you cannot see the other person and therefore cannot rely upon visual signs, you must rely solely upon what you hear. Decide to listen. STOP! Stop talking on purpose.
Encourage the person to answer each question in detail by remaining silent. Remember that silence often gives the person on the other end of the line time to think about an answer to your question. If you interrupt them, you may never know what important piece of information they were going to tell you.
Allow them time to think, you will get more information that way, rather than trying to fill in the gaps of silence. Show you are listening by using statements such as "I see" or "I hear you" "Okay" "I understand what you mean" or "Right." If you overlook this step, misunderstandings can come back to haunt you later.
Have you ever watched an orchestra when a group of instruments are not playing or are not getting ready to play? What do they do? Typically they put their instruments down or away from their mouths. Why do you think they do this? Could it be so they don't accidentally play a note and ruin the piece that is being played?
Control your urge to speak and you will make more sales. Remember, the secret to listening is to be interested, not interesting.
--
Make it a great day and a successful week!
Ron S. La Vine, MBA, President
Accelerated Sales Training, Inc.'s -
Live Cold Call New Business Development Sales Training™
Helping you Break into Large Accounts™
638 Lindero Canyon Road, Suite 283
Oak Park, CA 91377
818-991-6487 Office PST
818-519-3852 Mobile
818-991-5938 Fax
mailto:rslavine@ast-incorp.com
http://www.ast-incorp.com
Complimentary Sales Tips -
http://www.ast-incorp.com.com/free.htm
Join me at LinkedIn -
http://www.linkedin.com/in/ronlavine
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