Needing some basic demographics

Later in this chapter, I talk about the importance of demographics in winning new business, but demographics aren’t everything. In terms of understanding your targets, the basic demographic information you need is, at a minimum:

• Geography: Geography is important because you need to be able to service the prospect if he becomes a client, and if he’s hundreds of miles away or in a different time zone, can you effectively do this? Also, you’ll likely need to spend some time during the sales process with a prospect, and if he’s too far away, is it an effective use of your time?
• Business sector: Business sector is important because you’ll know where your solution is best suited, and if the prospect you’re looking at isn’t an obvious fit, then nine times out of ten, you’re better off passing him by.
• Company size: Company size is important for a number of reasons:
  • Is the company the right profile for your solution?
  • Do you have the right supplier profile for it to buy from you?
  • Is it likely to take too much resource to sell to or service?

After you establish some demographic qualification criteria, know that these aren’t set in stone. You’ll likely have some exceptions that may lead to solid new business wins. Although demographics are important, they’re not the be-all and end-all of prospect qualification. Apply a measure of common sense to your criteria because you’ll know better than anyone what a “good fit” really looks like.

Also, nothing is wrong with a prospect appearing to come out of left field, as long as you’ve followed your prospecting rules and accept that you’re following something out of the ordinary. To spend time on this prospect, however, you need to be confident that it’s worthwhile and generally that means having a manager or peer check your prospecting logic. Rarely is “because I know best” going to lead to new business wins.

You may want to set yourself some ground rules about investing a maximum amount of time in investigating left-field opportunities. Depending on your product or service, you may want to allow 5 or 10 percent at a maximum of your prospecting time for following your instinct, but don’t forget the basic prospecting and qualification rules, ever.

Sharpening your focus

When prospecting, your objective is to identify opportunities that have the potential to result in a new business win somewhere down the line. You need to be time efficient and highly targeted in your approach, accepting that you can’t go after every potential opportunity, simply because you won’t have time.

Earlier in this chapter, I talk about the finely tuned sniper’s rifle versus the farmer’s shotgun. Keep that image in mind as you prospect for opportunities. You’ll do better if you pursue opportunities that are highly qualified and are a very close fit to the profile of your ideal prospect instead of scattering resources around and hoping that you hit something that is of interest, largely more by luck that judgment. This attribute sets highly successful new businesspeople apart from run-of-the-mill salespeople.

Taking a highly targeted approach to prospecting allows you to quickly home in on those opportunities that should result in a discussion about how you’re able to help. You have a reason for speaking to the prospects, in that their profiles are a good match for your product, service, or experience, and therefore you have something of relevance to offer them. From the prospects’ point of view, they’re far more likely to invest some of their time in listening to someone who is relevant to them and can offer added value.

Understanding the profile of prospects you need to go after is the first step. Your next task is to begin looking for those prospects who meet your stated requirements. I outline a number of information sources that you can use to identify key targets in Chapter 23, so use them as a guide to help you find your own ideal data sources.

You can’t afford to be too blinkered in your prospecting approach, however, because you risk missing some potentially good opportunities. Good new business salespeople allow some “what if” time to explore non-obvious opportunities. For example, early in my new business days, I came across a company that needed new business help. As far as demographics were concerned, it was a reasonable fit; it was based close by and was an ideal size of company for us to work with, but it operated in a sector in which we had no previous experience. However, because the company provided a business-to-business service (an area in which we were highly experienced) and because the opportunity seemed interesting, it was worth having a discussion. This company became our biggest client, and we worked with it successfully for seven years. Had I been too limited in my prospecting approach, I would have missed it.

Establish a set of rules for going outside of being highly targeted in your prospecting opportunities. As I note in the preceding section, my rule of thumb is that when I’m not busy, I’ll spend up to 10 percent of my prospecting time investigating left-field opportunities as long as I can see and be able to articulate how our products or services can provide the prospect with a key advantage. If an opportunity fails this test, then I ignore it and move on.

About 99 percent of my success in winning new business comes from being highly targeted and knowing exactly what I’m looking for when prospecting. This is also what I tell clients to do and is one of the foundations of any successful new business campaign. Exceptions always exist, and as I highlight in this section, some of them will be very lucrative, but approach them as exceptions and with a very clear set of rules.

Knowing that timing can make a difference

In the majority of sales situations, you have a window of opportunity — that is, a set of circumstances that results in a prospect being in the market for a product or service. If this isn’t the case and no compelling time-driven reason exists for a prospect to make a buying decision, then carefully consider whether you should be investing your valuable time with him because he may decide to postpone any decision. You need to qualify the buying criteria and get the prospect to a point where the time to act is now.

Where timing is an issue, you need to understand what the time window is and what the driving factors are. Find out what factors you can influence and focus on these without wasting your time trying to change immovable objects.

If, for example, you provide a service based around annual reports for corporations, then your window of opportunity is going to be in the three months immediately preceding a company’s year-end. Outside of this time frame, you may have some interesting discussions but nothing is going to happen in terms of sales activity because it would just not be relevant. Avoid this time-wasting situation by understanding your prospects’ timescales.

When your prospecting uncovers an opportunity but you’re not yet in the time window, your role is to keep the prospect warm until he’s ready to act. In time-driven sales situations, you likely won’t be able to influence the timescale in your favor — that is, to get the prospect to buy according to your timescale and not his. Understand the factors that are driving the timescale and whether the window of opportunity is real or just a buyer-driven benchmark that has no basis in reality. If it’s the latter, then you have an opportunity to influence and change it, but if it’s really time driven, you need to accept that and act accordingly.

When the buying window is some months away, there’s no need to go all in with guns blazing. Instead, plan your campaign according to the reality of the prospect’s buying and action window. Until that window gets close, your role is to keep the prospect warm, keep in contact, keep qualifying, and keep feeding relevant information until the time is right for a full-fledged sales push.

Depending on your product or service and the business sectors you’re selling in, you can likely predict some buying windows or seasons. If so, use this to your advantage by getting your prospects into a position where you’re ready to sell to them at the right time — where they know you and your solution, are comfortable with the solution fit, and are ready to press the yes button as soon as the window of opportunity opens.

Time windows may be seasonable or driven by budget cycles or other external influences. It’s important to understand how timing influences your prospects, which is likely to differ among business sectors. Getting the timing of your sales campaign wrong will lead to frustration for both you (because you won’t be winning new business) and for your prospects (because you’ll be wasting their time as well as demonstrating your lack of understanding of their situation). Getting your timing right eases the sales process and helps you to be much more time efficient. I expand on the importance of timescales as a qualification element in Chapter 19.

Doing your own research

Timing can be everything. You can use timing to your advantage if your research shows an opportunity that needs action immediately, but you need to be aware of competitors having access to the same information and be prepared to react accordingly. You can subscribe to a number of press information services (I cover some of them in Chapter 23), but you need to recognize that your competitors are also likely to have access to the same information at the same time. Potential prospects face being bombarded with calls from suppliers, so you need to develop a way of being different from the crowd. How you do this depends heavily on your business and your solution, but a good rule of thumb is to consider whether whatever you’re going to say is something that can add value to the recipient. I advise that unless you can add value, then you shouldn’t call a prospect.

Some business sectors have research companies that make a living out of doing research for salespeople, generally selling the same research data to dozens or even hundreds of competing organizations. Although the quality of this data may be fine and even highly accurate, the fact that it’s made available to so many people waters down its effectiveness. Imagine being on the receiving end of countless phone calls all spurred by the same bit of research.

Beware of the potential of research leading you down dead ends, though. However tempting it is or however interesting a story may seem, you need to recognize where research for sales ends and chasing a story begins — unless you’re a journalist, of course, in which case why are you reading this book? Internet access and the advent of 24-hour news can easily lead you into far greater depth than you need for the purposes of sales research and can become a massive time waster.

So while accepting that research is vital in a sales environment, I suggest that you treat bought-in research with a measure of caution and, if possible, rely on your own, or in-house, research to provide you with an element of competitive advantage.

Researching prospects can be seen as a boring and repetitive part of winning new business, but don’t let it become mundane. Keep your mind fresh for spotting opportunities as they arise. Develop a lateral thinking mentality when researching; ask yourself, “What does this mean for us?” or “How would our solution help with that?” and see where the answers take you.

Research in prospecting is more than just looking for new opportunities, though. It’s important to also research people — decision makers and key influencers — who have a role in your prospects’ decision-making units. You also need background research on the company you’re going to be dealing with. This is important for two reasons:

• To make sure it meets your company’s qualification criteria
• To enable you to demonstrate enough knowledge about your prospects when speaking to them

You need to talk from a position of knowledge, being seen to be interested and knowledgeable about your prospects and, therefore, in their eyes, be the right person to propose a solution to their needs based on understanding them.

It’s often said that information is the fount of knowledge, and you gain knowledge from researching information. Your research objective in new business is to be able to build up a knowledge base that you can dip into whenever necessary, maybe to demonstrate understanding of a situation or maybe to be able to apply your knowledge to a new situation that you uncover. Later in this chapter, I talk about how you can use research knowledge to add value to your company’s sales database or CRM systems.

Finding resources that work for you

The secret of good sales or prospecting research is often the source of your base information. One of your first tasks is to be able to identify good, reliable, and consistent sources of information that you can use as the basis of your research knowledge. In Chapter 23, I go over some good data sources; in this section, I look at some areas you can investigate.

First, it’s important to do some research on your sources. What type of hit rate do they have in terms of accuracy? How reliable are they? Where does their information come from in the first place?

You need to develop a systematic approach to prospect research and find a way of doing it that works for you and delivers the results you need. In the 21st century, you’ll never be short of sources to look at, both online and offline, and part of your challenge will be to decide which sources work best for your specific needs.

Personally, I use both online and offline resources and subscribe to daily digests of information from newsletters and research clippings of services that focus specifically on my areas of interest. I get between 8 and 16 of these each day (the volume is dictated by the publishing schedule). I then back this up by looking at industry-specific publications relevant to anything I’m working on at that moment. I could probably spend my entire day reading research, which clearly wouldn’t get me very far with the rest of my role. So I scan the headlines only and then save all the data in a form that I can later retrieve by a keyword search. I delve in to details only as the need arises, but I feel safe in the knowledge that I have the data instantly available to me.

It’s a good idea to subscribe to the best business newspaper that covers your region. You’ll often find that they, too, offer an electronic business news update. In the United Kingdom, I use The Times for this. It produces at least two digests daily, one first thing in the morning and one during the afternoon, which I make sure to read and file. Depending on your geographic location, you may want to look at The New York Times, San Francisco Business Times, The Wall Street Journal, Reuters, or whatever is best suited to your location. Industry-specific publications are also great sources of research information and usually published in paper format with an online option.

Surrounding yourself with data is not the objective, though. The objective is to be able to distill information into research knowledge that you can make use of in your new business sales drive. To avoid information overload while being able to process information, you need to develop a series of triggers — things to look for, action points. If you do as I do and save research into a tool such as Evernote, you can then use the automatic indexing to find these triggers. I cover this a bit more in the later section “Adopting an effective workflow,” and Chapter 23 lists some good data sources that you can use as a starting point.

The bottom line with prospecting research is that you need to allocate an amount of time to do this every day. It needs to become a habit, and when done correctly it will yield important information to help you win new business. No one said it was easy, but it will pay dividends.

Reading between the lines

Research is so much more than just gathering and storing information. It’s about interpreting and disseminating information into knowledge. You shouldn’t just rely on something that you read; you need to test it, which I cover in the next section, and put it into context so you understand what the data is telling you.

For example, say you read an article that tells you one of your prospects is about to appoint a new finance director or chief financial officer (CFO). What does that tell you and what should you do about it? If you’re close to reaching a buying decision with that prospect, then the news may set off alarms that spending plans or purchase authority may change. If you’ve been struggling with getting budget sign-off, then this may signify a change of position and could be good news. No obvious fallout from such an appointment may exist, but you need to note it and maybe mention it when next speaking to your contacts to show that you’re on the ball and checking that it makes no difference to your sales proposition.

Sometimes research information you come across will lead you off on a tangent and lead you to uncover more information or even a new opportunity. Research tangents are fine to follow, but be aware of going down dead ends. Experience will soon lead you to the right decision, but in the meantime it can be a steep learning curve. Talk to your peers and ask for the benefit of their experience because rarely does one answer fit all.

Does anyone else in your company need to know about research snippets you’ve gained? Do they have information that you could benefit from knowing about? Figure 9-1 shows a CRM system my company used to evaluate a potential prospect. The first thing you may notice is that we had some discussions with this company in 2011, 2012, and 2013 so it came onto our radar several times without converting to a client. A quick scan of the historic notes shows that the company already uses an outsourced new business team and has used them for many years. Because of this long-term relationship, this client will be difficult to win, so we’d be better off spending our time on other opportunities rather than wasting resources on pursuing this one. (Later in this chapter, I talk more about CRM systems.)

Another thing to be aware of with research is not to use it as an excuse to delay action or to not do something. Sometimes delaying an activity is the right path to follow based on a research snippet, but don’t assume that will always be the case. A general rule is to continue along your sales process unless you see a clear benefit to waiting.

Testing your assumptions

All sorts of information can be passed off as research, and not all of it is either correct or helpful. Don’t necessarily assume that something you read is actually true. Test it, ask about it, and challenge it if in doubt. Does this new information fit with what you already know, or is it something completely new? Is it in keeping with what you’d expect?

Be aware of red herrings getting in the way of your sales process. Would you believe a reporter who tells you the earth is flat after all? Of course not, because everything else you know tells you otherwise. Treat suspect research data the same way.

Considering demographics

An obvious starting point in first-level qualification is that the prospect’s demographics need to be right. As a first level of qualification, some basics include

• Location: The prospect is located in an area that allows you to service it in both a sales cycle and later as a client.
• Sector: The business sector that it operates in is one that your solution is at least a decent fit for.
• Size: Company size is important — too big and you may not be able to cope, too small and it may not be able to afford your solution.

Based on your experience, you should be able to gauge how much prospects are likely to spend on a solution such as yours based on how big they are and how important the need you’re offering a solution to is. At the first-level stage, you have to estimate a lot of this information, but if your experience tells you there’s a mismatch here, then it likely won’t go much further and you should generally qualify this prospect out.

As part of a first-level demographics qualification exercise, you need to consider how good a fit your offering is likely to be for the prospect. Again, this is based on estimates of need, but knowing your product or service as you do, you’ll have a good feel for how it’s likely to work for any given situation. If you’re not comfortable with the fit, then qualify out and move on.

Checking annual reports and public information

Where does first-level qualification information come from? Your own CRM system is an obvious starting point to see what you already know about prospects. Because colleagues may have looked at them in the past, you may have a lot of information already available at your fingertips.

Figures 9-2, 9-3, and 9-4 show a typical use of a CRM system. In these scenarios, colleagues supplied information about a prospect as part of their prospecting efforts. This tells a story of a prospect that seems to be a good fit at first glance:

• Figure 9-2 shows that the prospect was actively looking to work with the company after getting additional staff in place.
• Figure 9-3 shows that there was a long series of communication with the prospect over several months.
• Figure 9-4 shows that maybe it’s not such a good prospect after all, because the timescale is constantly slipping and the requirements appear to be changing.

You can use this historical information to get a feel for an opportunity and make a judgment on committing time and effort to it.

The next obvious places to look are at online resources, and among the best for this type of activity are LinkedIn and Facebook business pages. These resources are useful for both finding company profiles that are good fits and identifying decision makers. Use this data as a guide only, though, and be sure to cross-reference it with other data sources to improve accuracy.

For public companies, annual reports are a great source of information. While the financial data is interesting and informative to the qualification process, the rest of the document is often used as a company insider sales brochure and as such can often contain real nuggets of qualification data about both the company and the key individuals you may need to deal with or be assessed by.

Online reviews and write-ups on the prospect’s business are another good source of data you can use for first-level qualification, and the same is true of articles in trade publications. You can identify decision makers and influencers from these articles and have a good idea of whether the type of business they operate in are likely to have a need for your type of solution.

In all of this, one of your key tasks as a new business salesperson is to make sure the information you’re gathering turns into useful knowledge for the business to act on, either now or in the future. For this reason, you need to get into the habit of logging it into the CRM system. See the later section “Adding value to CRM systems” for more information.

Covering the decision-making unit

In Chapter 19, I talk about the decision-making unit (DMU) and its role in the new business process. At the first level of qualification, the types of questions you need to consider are how you’re going to approach the DMU and where your entry point will be based on the prospecting information you’ve discovered. For example, if you know that a prospect is experiencing rapid growth and opening new sites, you may consider how your solution can help and what role your solution would most assist. That should give you a clue about how to approach the prospect when the time is right.

In addition to considering who to approach, you also need to prepare your reason for contacting the prospect and figure out how you’re going to quickly engage his attention with your product or service. If it’s not obvious based on the prospecting information you’ve uncovered, then the prospect has most likely failed your first-level qualification test and you should move on to another target.

Do you have suitable case studies prepared that you can use to attract the attention of key members of the DMU as an introduction? Great, if you do from a prospecting point of view. Again, if you lack a suitable “in” to the DMU, then you need to consider how strong your first-level qualification is.

You’re going to qualify out more prospects than you qualify in at the first level, and that’s fine. It’s the entry point to your sales funnel, and your objective is to whittle down the numbers until you’re left with well-qualified prospects to spend your valuable sales time on.

Noting that some prospects aren’t right

Right at the outset of your career in winning new business, you need to understand that you’re not going to sell to everyone. Part of your role is to qualify out those potential opportunities that aren’t going to convert into new business wins, and the sooner in the prospecting process you do this, the better.

A prospect may not be right for lots of reasons; here are some of the main ones:

• Legal or ethical reasons: Legislation or company policy may bar you from dealing with some types of prospects; if so, they are automatically qualified out.
• Cultural reasons: Cultural or even language reasons may get in the way of being able to deal with some business or personnel types. Even in the 21st century, this is not an uncommon occurrence. If you face this roadblock, these prospects are automatically qualified out regardless of how good a fit your solution may have been.
• Competitive reasons: Competitive reasons for qualifying out a prospect can be a bit of a minefield. Trading laws in some regions prohibit you from denying a service to a company on competitive grounds, so you need to tread carefully here. You may have non-compete clauses in existing contracts that prohibit, for example, sales to named competitors of existing clients. One of your competitors may be interested in looking at your solutions and you’d be unwise to entertain him as a prospect, unless of course it is to feed him incorrect data, but that is a whole other topic.

Some companies that your prospect research highlights may just be entirely the wrong profile for your solution. In this case, not only are they qualified out, but you may also want to examine how they even got onto a prospecting list in the first place. This examination may result in you making changes to the research parameters that you specify, but don’t worry about doing this as it is a constant learning process.

Adding value to CRM systems

First, what do I mean by the term CRM system? It has come to have different meanings, and dozens of software CRM products are available on the market. Ultimately, it doesn’t matter what type of system you use or what label you attach to it. Some call it a database, others just a sales system. What I’m describing is a system to keep track of all the data you collect on a company along with all the interaction you have with that company.

Any system is only as good as the data that it holds and the use it’s put to. There really should be no reason for every piece of data that you have about a prospect not to be included in this system. How do you know whether a piece of information you’ve found is relevant? Often you don’t know, so include everything. Only by aggregating this data can patterns begin to emerge that can give you clues as to how to approach a sales situation with a prospect.

Adding all the prospecting data to a CRM saves someone else from reinventing the wheel the next time that prospect comes onto the sales radar. Because you’re laying a lot of the groundwork and the information is instantly available to be looked at and worked on, you further add to its value.

Historical sales data can often hold the key to unlocking a future sale. Figure 9-5 shows a CRM system displaying a research snippet that highlights that a prospect is actively involved in building its business and therefore is likely to be a good fit for some services.

Adopting an effective workflow

Implementing the steps outlined in this chapter requires a lot of effort, so how do you go about achieving it in practice? The only effective way to be able to do this is to adopt a structured workflow, a set of routine steps that you repeat for each prospecting step and each opportunity.

A workflow needs to be specific to each salesperson’s situation. For example, Figure 9-6 shows the workflow that one of our clients uses for this purpose. This will give you an idea of the type of steps you need to include as you tailor your own workflow.