8 Techniques for Managing Prospect Risk

Selling is a "Zero Sum Game."
Someone wins and someone loses.

When developing your sales process (as a corporation or as a quota carrying salesperson), you need to decide if you are going to use a premeditated (proactive) sales process or a reactive sales process to manage your zero sum game outcomes.

A "premeditated sales process" is characterized by:

  • knowing which targeted accounts are sought by name or demographic profile;
  • understanding why they will buy; and
  • using a written sales process.

A "reactive sales process" is characterized by:

  • waiting for inbound leads;
  • trying to sell everybody you talk to;
  • not knowing why prospects buy from your firm; and
  • having no documented sales model process that takes clients through action steps.

Which is your firm’s selling process?

Premeditated or Reactive?

In a sales survey by HighTechSuccess, 83% of salespeople surveyed (almost 2,000 respondents) indicated they did NOT believe their firm used a market study or market research to calculate their sales quota based on demand.

Without identified sales territory market potential, the lack of business research forces quota carrying salespeople and VP’s of Sales into a "Reactive Sales Process" unless they take corrective actions and prepare to manage their sales quota.

To sell more, you must plan more.

To sell more, use a technique of Value Forward Selling called "Risk Management".

Key accounts, SMB prospects and targeted buyers always seek to minimize their risk when buying products and professional services. Risk management should then become a premeditated sales process tool to use when you sell.

On the first pass, most prospects (at the management level) are skeptical. They just don’t believe you or any other salesperson. It’s nothing personal. There are just too many salespeople.

So, help them manage their perception of buying from you. Here are some guidelines to prepare for prospect risk management.

8 Prospect Risk Management Techniques

  1. When competing against big companies, manage the risk by focusing on your strengths. Use the "bus analogy" when competing against them, "Large firms bus in and out their lead team and usually have no practice manager continuity, while our team remains the same throughout the relationship."
  2. Never wait for a prospect to ask about your firm's background. Always supply details in advance. If the following variables are positive, you will want to provide corporate information including the number of employees, years in business, clients' names and annual revenue. If these variables are negative (i.e., losing money, no installations, customers hate you), then don't bring it up and focus on the other methods listed.
  3. The greater the competition, the more risk management information you must deploy to balance perceived fear. Do not be passive when competing against established players - go after their largeness as a weakness. Never negatively sell; instead, communicate your value aggressively.
  4. Never have your CEO or VP of Sales go on a first sales call. It makes your firm look small. CEO's and VP’s of Sales are big guns held in reserve to be used when needed, not on the first sales call. Having CEO's go to your first client meeting only works when your firm is a Fortune 500 and you are meeting a Fortune 50 C-level executive.
  5. If you are VC-funded and have new product or service, name-drop your VC's relationships.
  6. If you are a small or startup firm and have Fortune 1000 C-level executives on your board of directors, say "our team includes . . ." and name-drop their positions and the company names with which they are associated.
  7. To manage the prospect's fear of buying something other than what was shown in a demo, it is always a good idea to have a client feature/service sign-off sheet for any demonstration. This protects the salesperson from the client's demo amnesia and protects the client from being oversold.
  8. Never represent your firm as a generalist. Always be a specialist. Generalist firms are always perceived to be large and slow. Specialist firms are perceived to be more customer centric.

Selling is a premeditated sport. Don't shoot from the hip. Help your prospects purchase by managing their fear of risk.

If you manage the client's needs, you will manage the sale in a premeditated sales manner and you will sell more.

If you ignore the client's risk issues, you will lose the deal.

Remember, the client's perceived risk is your sales risk.

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