A friend asked me to describe to him exactly how selling works. To answer the question, we do need to look at how a very simple, straightforward, and transactional sale works. But we also need to explore more complex sales. Each section here starts by describing simple sales, then presents some ideas about complex or consultative sales.
Responding to vs. Creating Needs
Selling begins with the idea that someone, somewhere, needs something. They want or need an outcome that they are not able to produce without some new resource, whether that’s a product, a service, or a solution. Some of the time, the buyer knows their need and recognizes that something isn’t good enough. This is how simple sales start.
However, in a consultative sale, buyers may not know that they need a better outcome or that one is even possible. In these cases, selling begins with a conversation about how the person or company could improve in some meaningful way that they don’t yet recognize. That means the salesperson must help them recognize a need they didn’t know they had: you didn’t need an iPhone or an iPad until Steve Jobs showed them to you.
Traditional vs. Modern Discovery
In a simple sale, a prospective buyer has a well-formed understanding of their problem and how they might be able to solve it, while the salesperson asks questions to understand the buyer’s challenge and what they need to improve. Salespeople create value by helping their prospective clients explore possible solutions, landing on one that allows them to improve their results. This part of the sales conversation is called traditional discovery.
In a more complex sale, the prospective client may or may not recognize their problem, even if they are already producing results that are in no way optimal for their circumstances. The decision-makers and decision-shapers may need a salesperson to help them explore what better futures might look like, as well as all the factors that are creating problems for them—even if they don’t yet understand why. This is a modern version of discovery, where the salesperson helps compel the client to change, hopefully before they are harmed by not having changed sooner.
Simple vs. Complex Solutions
In a sale that is simple and straightforward, once the salesperson has a good understanding of their prospect’s problems and the outcomes they need, it is customary to present them with a solution in the form of a proposal, including the price they will need to pay for what they are purchasing.
In larger, complex, or consultative sales, you may need multiple conversations to land on a solution that is exactly right for your prospective client. Likewise, you will need to involve more people in the conversation about that solution, since you’ll need support from those who will be affected by whatever change comes with a new solution. Gaining that consensus can take more time, and only when the solution is right will the salesperson provide a proposal.
Pricing vs. Investment in Results
A simple sale will come with a price that is, generally, very straightforward. But no matter how simple the sale, clients tend to ask questions about the price or request some sort of discount. Mostly, this is driven by the contact trying to make sure they don’t overpay for something, and by their desire to do right by their business.
In a complex sale, the investment conversation may happen a bit earlier, allowing the salesperson and their client to understand what they can invest in their solution before they determine what it looks like. In larger sales, the prospective client might be constrained by the amount they can invest in the better results they need. The salesperson will still be charged with having a conversation about the investment they are asking their client to make, and just like in the simple sale, the client will ask about the investment. In complex sales, reducing the investment can harm the results, making the overall negotiation more challenging.
In a straightforward, simple sale, the salesperson can expect their client to offer them “objections,” the idea that something isn’t quite right. The salesperson resolves those objections by providing the client with more information, making it possible for their prospective deal to move forward.
In complex sales, clients don’t have objections as much as they have concerns, which are very real and to be resolved before moving forward. When decision-makers and decision-shapers have unresolved concerns, they tend to take no action, fearing that their decision may not work or may make things worse for them. The salesperson is expected to be able to resolve those concerns, even though some contacts will not bring up their concerns until the salesperson encourages them to engage in this part of the sales conversation.
Negotiation and Acquisition
A transactional sale will have a straightforward back-and-forth negotiation, mostly around price, followed by an equally straightforward contract. That’s often accompanied by the paperwork necessary to set up the new client in the sales organization’s system, and to set up the sales organization in their new client’s payment systems.
In consultative sales the negotiation may be more complicated, covering terms, conditions, service-level agreements, and pricing structures that are based on certain outcomes or discounts for reaching certain spending targets. There may also be negotiations about insurance, indemnification, and how risks are going to be allotted to each company. These conversations tend to take longer to conclude, something that is especially true when the sales organization needs to negotiate with their client’s lawyers.
In both a simple and complex sale, you are going to sign a contract and begin to execute your solution for your new client. The more you take care of your client’s needs, the more you are going to be given a chance to help them in the future— starting the process all over again, creating greater value, and solidifying your relationships with your contacts.
There is much to know about how selling works and how buyers buy. Selling effectively requires mastering a lot of details and developing a lot of competencies, but the descriptions above provide a reasonable map from which to start.
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Filed under: Sales