In part three we looked at some questions you can ask to develop a clear understanding of why a customer has an interest in your product. I can’t stress enough how important this is – unless you know the basis of a client’s motivation to enquire about a product or their intention to purchase, you can’t really be confident that any proposal you make will be on the money.
A common failing in sales people is that they make the assumption that because a client has expressed an interest in an offering, they understand the value it can generate for their business. As we all know, assumptions aren’t the most reliable beasts and immediately put you at a disadvantage when competing with a supplier who’s done their homework.
So how do you do this?
Looking at some hypothetical answers to my three questions, you can see how the process takes shape:
|Q. What’s prompted your interest in Postcode Anywhere?||A. Well, we’ve been thinking about implementing address capture on our ecommerce web site.|
|Q. Is there a specific problem you are trying to solve?||A. People aren’t always entering valid addresses at our web site and we are getting a small number of returned items.|
|Q Why are you considering this now?||A. My boss has asked me to solve the problem.|
You can see immediately what is driving the client’s interest in the business – a frustration at receiving poorly typed and inaccurate addresses and the cost of processing returns. Plus, the boss is on the warpath, so it’s all looking very good.
However, they may not yet have justified the additional spend, so we shouldn’t stop here. If the customer knows the cost of handling returns and find out the number of items involved, you can start to put a value on these “drivers”. Asking how much each return costs, the customer may say something like £20. If they estimate that this affects 1 in 50 parcels and they are sending out 1000 a week, the total cost would be £400, the equivalent of £20,800 a year.
Therein lies the justification needed to get them out of Stage 1 (Motivation) and into Stage 2 (Intention). The cost of using address validation would be in the order of £1100 a year, so even if the number of missed deliveries is reduced by only 50% they still make a decent saving, plus they have a whole lot more happier first-time customers.
Even so, we aren’t done yet. In Part 5 we’ll discuss how, at Stage 2, you can increase your competitive edge by expanding the sale.