Sales Principles

"People hate advertising until they lose their cat." - David Droga

Sales can be a touchy subject – it’s essential for every business, it can make or break your profitability, and it’s everyone’s responsibility.
And yet, sales is seen as a grubby subject, one that is often taken to some unpleasant extremes.
Worse still, most of the books and resources are created by people who are trying to sell you on a particular methodology or service.
That leads them to over-inflate their promises, and also makes their content age like milk (particularly when they’re describing tactics for digital marketing).

Instead, let’s look at the underlying principles behind a healthy approach to sales.
This is perfect for those of you who aren’t “traditional salespeople” or who are grappling with the ethics of selling something with a social mission.
These are our principles rather than facts, and you can make up your own mind before accepting them as your own.

Sales Is Recommendations

Sales can feel pushy, like it’s our job to trick or coerce someone into acting against their best interests.
It doesn’t feel like it helps them.
A recommendation is different – it’s when you’ve listened and understood another person, then offer a suggestion or alternative that you suspect they would love and appreciate.
We naturally make these recommendations all the time – suggesting restaurants, musicians, TV shows, books, new friends, career paths or holiday destinations – and none of these feel grubby.

You’ve probably benefitted from good recommendations in the past – someone encouraged you to read a book that changed your career, see the physio who fixed your pain, discovered a movie that became a personal favourite, or introduced you to new food that broadened your palate.
These recommendations cost the other person almost nothing, and yet they gave you so much joy or relief.

Daniel Pink’s book To Sell Is Human nudges you to treat sales the same way; choosing to be a great recommender, even if your recommendation is that the other person shouldn’t go with your company.
That builds trust and credibility, which come back to benefit you in the long run.
This approach takes the pressure off the final decision, and instead makes the aim to be a great recommender – something that is within your control. 

Winking In The Dark

“Doing business without advertising is like winking at a girl in the dark. You know what you are doing but nobody else does.” - Steuart Henderson Britt

You have what’s called “The curse of knowledge”, whereby you forget how much you know about what your business does and how it can help people.
We forget how little other people have taken in about our work and our brand, so they’re going to need constant reminding and advancements on our story.
Like a wink, it doesn’t have to be pushy or sleazy, but we need a way of reminding our audiences that we’re here for them and have something to offer.
If they don’t see the signal or don’t understand it, there’s no more to the interaction.

Permission Marketing vs Interruption Marketing

Seth Godin describes two types of marketing; interruption marketing (like a TV ad in your favourite show) and permission marketing (like from an account you enjoy following on Instagram.

“Permission marketing is the privilege (not the right) of delivering anticipated, personal and relevant messages to people who actually want to get them.
It recognizes the new power of the best consumers to ignore marketing. It realizes that treating people with respect is the best way to earn their attention.

Real permission is different from presumed or legalistic permission. Just because you somehow get my email address doesn’t mean you have permission. Just because I don’t complain doesn’t mean you have permission. Just because it’s in the fine print of your privacy policy doesn’t mean it’s permission either.

Real permission works like this: if you stop showing up, people complain, they ask where you went.

Permission is like dating. You don’t start by asking for the sale at first impression. You earn the right, over time, bit by bit.

Permission doesn’t have to be formal but it has to be obvious. My friend has permission to call me if he needs to borrow five dollars, but the person you meet at a trade show has no such ability to pitch you his entire resume, even though he paid to get in.

Subscriptions are an overt act of permission. That’s why home delivery newspaper readers are so valuable, and why magazine subscribers are worth more than newsstand ones.

In order to get permission, you make a promise. You say, “I will do x, y and z, I hope you will give me permission by listening.” And then, this is the hard part, that’s all you do. You don’t assume you can do more.

If it sounds like you need humility and patience to do permission marketing, you’re right. That’s why so few companies do it properly. The best shortcut, in this case, is no shortcut at all.”

This goes against the old philosophies of selling, which would tell you to use any trick possible to win a sale, even if it’s by knowingly annoying the bulk of its recipients.
Godin wrote the above in 2008, pre-Instagram, but it explains the success of the “influencer” – someone who has earned the interest and trust of their audience.
Permission marketing requires a lot of work, but it takes out the majority of the grubbiness that you don’t like about other salespeople.

We Want To Create Happy Customers

The high pressure sales methodologies of the 1980’s worked for a while, but have been undone by a recent innovation: the customer review.
An unhappy customer in the 1980s might have suffered “buyer’s remorse”, but didn’t have much they could do to warn anyone outside of their immediate circle.
Today, an unhappy customer can vent about the differences between what was promised and what was delivered, with evidence, and it will appear before everyone who is evaluating the brand in the future.
If enough people have a bad experience, it will ruin your reputation and hinder future sales.

Scrambling to make sales in a hurry encourages the salesperson to over-promise and under-deliver, or to make a recommendation that doesn’t serve the customer well.
They engage in a win-lose deal, and now that the customer has a megaphone, these end up as lose-lose deals.

Cliché as it may be, we want our sales to be a win-win proposition.
Happy customers become free ambassadors for your brand, to the point where it might be better to make less margin per sale in order to ensure that they are genuinely delighted with their deal.

The Two Barriers To Happy Customers

Almost everyone would agree that we want to create happy customers, and yet this probably isn’t your experience of interacting with salespeople.
That’s probably because of two things that can override the desire to serve customers well: desperation and perverse incentives.

Desperation is when a company puts pressure on its sales team to hit a target, out of greed or out of fear.
It’s a moment where the salesperson’s focus shifts away from the customer and stays on their own needs from the conversation, thinking of anything that could convince you to part with your money.
e.g. the Mazda salesperson who pushes you into buying last year’s model of car, and when you ask about the new one they say “oh nah, you wouldn’t want one of those”.
It’s immediately obvious that they have an agenda that overrules your needs, and you’ll probably try to leave the conversation as quickly as you can.

Perverse incentives are when a salesperson is trying to reach a target or fulfil a criteria, even if it doesn’t fully serve the customer or the business.
e.g. pushing for customers to buy a certain item or accessory, and losing their trust in the process.
The business might have offered a reward or prize for whoever can reach the highest revenue totals that month, or whoever can push the most of a particular product.
The sales team go into every interaction having pre-judged the outcome they’ll recommend, making them prejudiced.
Perverse incentives are dangerous because they work…briefly.
You’ll see a sales spike, but it doesn’t last, and causes damage to your reputation that might take a while to see, let alone address.

The solution to both barriers is to start your sales strategy early, before any desperation clouds your better judgement.
You can’t build trust in a hurry, nor can you measure the most meaningful results.
Time pressure leads to bad targets, a bad atmosphere, and bad customer service.

Know, Like and Trust

Customers cannot and will not shop with you until they:

·      Know who you are

·      Like what you’re doing

·      Trust you can do it for them

Know, Like and Trust – the basis of every good sales strategy.
Improving any one of these three will ramp up your results, and a bottleneck in any one of these three will limit your progress.
Which are you strongest in?
Which needs the most work?
How do your favourite brands do this well?

Sales Is Experimentation

Our job is to make an offer, and to learn from people’s reactions.
We cannot make people buy, we cannot make them like us.
The job is to make the offer, sincerely, bravely and wholeheartedly, then measure the feedback the market gives us.

This means you should try anything and everything, at least for a little while, to see what resonates with your market and what generates a sale.
It might be through content marketing, paid ads, approaching senior leaders at industry events, influencer partnerships, so long as you have a way of determining if it’s effective.
As W.C. Fields said: "If at first you don't succeed, try, try again. Then quit. There's no use being a damn fool about it."

You Are Responsible For The Lead Measures

Experimentation involves measurement, but not all measures are the same.
There are two types of indicators to measure: leading and lagging.
A leading indicator describes and measures the work you are putting in, whereas a lagging indicator describes the results you are seeing.
For example, your lead indicators might include:

·      Number of calls made

·      Number of articles written

·      Number of events attended

·      Number of business cards given out

·      Hours spent on training and development

Your lagging indicators might include:

·      Revenue generated

·      Hits on your website

·      Engagement on your social media posts

·      Number of customer inquiries

·      Customer satisfaction scores

Sean Covey and Chris McChesney wrote in the book The Four Disciplines of Execution:
“Most company indicators are lagging measures because they indicate the company’s previous performance. Leading indicators, on the other hand, measure behaviors or factors that can predict lagging indicator performance and which the company’s employees can impact directly.”

“A good lead measure has two basic characteristics: It’s predictive of achieving the goal and it can be influenced by the team members.”

You’re in charge of the lead measures, but you’ll need to keep an eye on the lag measures too.
i.e. you’ll need to write your third article before you know if the first article resonated with your audience, you’ll need to attend events before you know if you’ll meet any good customers, etc.
The lead measures are the ones that are within your control, and so are the ones to hold yourself accountable for each day.
For example, Hugh Stephens teaches entrepreneurs the “Ten by ten rule”; you need to have made 10 calls to customers by 10am.
That might sound like a lot, but you can see why it works – if you’re making ten attempts first thing in the morning, you can imagine that the sales will follow. 

Look At Both Costs And Benefits

"You can't expect to hit the jackpot if you don't put a few nickels in the machine" - Flip Wilson

The sales process is costly; even if you’re trying not to spend much cash, you’re paying with your time, energy and emotional labour.
How much you spend is less important than your ROI; Return On Investment.
Spending a lot of money on sales might be a great move, if it leads to an influx of new customers or repeat orders.
Cheap isn’t good if it doesn’t get you additional revenue, and expensive isn’t bad if it pays for itself.

Be careful when you don’t have a way of measuring the costs or the benefits of a new sales approach.
If you can’t measure what it costs or what it created, how will you know if you should cut it, keep it or double down?

Turnover Is Vanity, Profit Is Sanity

It sounds impressive to say “We’re going to do $5m in sales this year”, but what does this actually mean?
How much does it cost you to deliver all of that work?
What if it costs you $5.5m?
There’s no glory in a revenue target without a margin target, and there’s not much point growing to be “a five million dollar business” if it sends you broke in the process.

Margins are what keep your business afloat – they help you survive tough times, hire new staff, buy additional equipment, or expand into a second city.
In that regard, a margin target is more important than a turnover target.
Making $200,000 of margin from $800,000 of sales is better than breaking even on $1m of sales, but part of your brain won’t want to believe it.

You Don’t Have To Be An Extrovert, But You Do Need To Be A True Believer

We need to genuinely believe in what we’re selling.
Otherwise, what are we doing?
You’ve built this for a reason, so don’t be afraid to share that good news.

You are not your brand, but you are the designer of your brand.
Its voice doesn’t have to be your voice, its face doesn’t have to be your face, but you’re going to have to choose how it will look and sound.
If you’re not convinced that this will serve customers well, how are you supposed to design compelling messages?
If you don’t genuinely want more customers, no sales software or CRM can grow the business for you.

In some cases, a founder might decide that they genuinely believe in the next iteration of their work.
That seems reasonable, so long as it doesn’t result in a delayed release or unhelpful perfectionism.

Good Taste Can Come From Copying Good Taste

You know some amazing salespeople – even if it doesn’t say that on their business card.
They might be teachers, parents, mechanics, preachers, comedians, content creators, nurses, baristas, designers or artists.
These are people who are excellent at some part of the sales process.
Maybe they’re great at creating a first impression, at asking good questions, framing options in an enticing way, explaining choices and benefits in an exciting and relatable style, or in following up without feeling sales-y.
They are probably great at making recommendations, which probably served you well.
It might be that they are good at being know, liked and trusted.

You can copy their approach, without any plagiarism or repercussions, especially since nobody is likely to pick up on where you got your “inspiration from”.
This is especially true when you take inspiration from people outside of your industry, who lose nothing by you copying their approach.

Get Used To Repetition

"Everything has been said before but because no one listens you always have to say it again" - Andre Gide

You may as well create a sales process that you like, because you’re going to be having the same sorts of conversations over and over again.
You’re constantly meeting new batches of potential customers, who will need to be shown their options as they make up their mind.
They’ll ask the same questions and offer the same hesitations, but you’re able to anticipate these and create great answers ahead of time.

Here’s an extreme example of a business who gets it: Volkan Cinema in Santorini, Greece.
They know that their audience is in town for 2-5 days, and have time to see one movie at the most.
Here’s their program:

This is what David Ogilvy described as “not advertising to a standing army, but to a moving parade”.
Next week’s customers will need to hear it all over again.
You get to test your stories and messages, test your channels and their ROI, then make improvements to see what makes a difference.
This gives you permission to make mistakes, so long as you learn from them, as the next wave of customers is unlikely to ever know how rusty your pitch used to be.

Not Everyone Needs The Same Deal

One of the most liberating realisations for new entrepreneurs is the idea that they don’t have to design one product or one price point that is perfect for every customer.
You’re allowed to have different packages, tiers and discounts to suit a range of customers with a range of budgets.
You’re allowed to sell a good, a better and a best option, and to be proud of each of them.
You’re allowed to offer more to customers with higher budgets, or offer less to help accommodate customers with smaller budgets.

Sometimes it might not cost you much more to create the higher priced package, and that’s ok.
As Dave Trott noted: “It doesn’t matter what went into it. What matters is what people get out of it”.

Sales Doesn’t Have To Be So Serious

"I regard the hunt for new clients as a sport… if you play it grimly, you will die of ulcers. If you play it with lighthearted gusto, you will survive your failures without losing sleep. Play to win, but enjoy the fun." - David Ogilvy
If your sales meetings are either dull or high stakes, your team will learn to resent them and want to avoid them.
Personalising your results is unhelpful for everyone; customers buy for all sorts of reasons that are out of your control or have nothing to do with you, so holding yourself personally responsible for their decisions is ridiculous.
Think about it from the other side – how often have you backed out of a purchase for reasons that have nothing to do with the salesperson?

The great thing about principles is that they’re likely to stand the test of time.
Take the ones you like, leave the ones you don’t, or look at why certain principles might need to be adapted to suit your style.
The world needs more good salespeople, who are committed to being good designers as well as good recommenders.
It might not be the fastest way to earn money, but it’s a great way to build a lasting reputation.