How to sell in a recession
Learn from the past
By Fred Kessler
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Worried about your sales numbers? You should be.
You
should be aware of the problems and opportunities in this economy and
that business failure rates are increasing and haven’t peaked.
With
the last serious economic downturn more than 30 years ago, not many
current sales professionals were in sales in the mid to late 1970’s. So
if you are under 53, you haven’t sold in a tough economy.
The
recession of 1980-‘82 was one of the mildest in history and represented
more economic stagnation than loss. So if you are under 46, you likely
didn’t sell during that mild recession either.
Sales reps will
cite the bubble burst at the turn of the millennia — but in real
economic terms, the economy grew those years. We’ve seen the longest
period of economic expansion in history. There is an unfortunate price
for the good fortune: The sales force of today isn’t prepared to deal
with selling in a recession.
Here are three keys to selling in a recession that may help you:
Down economic times doesn’t mean there isn't any money to spend.
It
just means that customers are driven differently than in a boom
economy. Customers are saying money is tight. Credit lines have been
disappearing, profits are down, non-essential spending is down — so
customers aren’t lying but they aren’t telling you everything either.
The
customers aren’t saying there is no money. Every major study in sales
since 1950 has found that neither price nor budget is any higher on
buying motivations. But in a recession, what does drive a customer?
Neil
Rackham, author of "Spin Selling," gave the compelling statistics on
selling in a depressed economy this year. What swayed customers in the
Great Depression, the recessions of 1953-‘54, the 1973-‘75 recession,
the 1980-‘82 recession and today’s recession? Customers want protection
- they want to avoid risk and will pay a premium to do so.
During
down economic times, people want security even if it is at a price.
Price or "no budget" objections are an easy way to get rid of sales
reps because most won’t probe further. When you don’t know what will
happen with your vendors, clients, or credit lines — wouldn’t you want
a little more security as well?
Force objectivity about your pipelines.
It’s tempting to stick with the prospects that you already know as times get tough. It’s tempting but it will cost you dearly.
Chasing losses isn’t something only done in Vegas. Its typical human
behavior to want to invest "just a little more" to reclaim our losses.
Sales is no different. The prospects that you’ve called on five or six
times that you know are stalled or aren’t closing take on an added
perception of value in tougher times.
You already know these
prospects and feel like you’ve already made the investment to get "this
close." Sales reps will call these prospects twice as often in a
recession than they otherwise would. The result? The sales numbers go
down.
Those customers didn’t close in the normal amount of time
for a reason. You will be more profitable spending that extra time
developing new prospects than to resurrect a customer that never was
close to closing. This can give you an edge since your competitors are
likely making the same mistake and not focusing on new prospects.
Aggressiveness in sales and sales management wins the day in tough times.
A
down economy presents a chance for radical change. The job market is
drying up, and, as we pointed out earlier, people will pay more for
security (including your sales staff).
Make the changes you
know will improve your sales performance and profitability but that you
haven’t tried for fear of rocking the boat. Radical thinking and
aggressiveness are the key characteristics of successful sales people
and successful businesspeople in general.
Your sales force has
to be aggressive, know how to ask questions, and be rewarded well when
they succeed. Focus your efforts on what makes you money — the
successes within your sales group. Many companies will cut budgets, lay
off trainers and cut sales support or marketing. Drinking less water in
a drought just delays the inevitable. The solution is to find new
sources of water and use every tool you have to get there.
The
times are challenging for sales. But they’ve been so before and will be
so again. You can either profit from the opportunity or become a
statistic.
It’s time to profit from history.
Fred
Kessler is the president and CSO of Sales Partnerships, Incorporated in
Westminster. Contact him at 303-412-3185 or via email at
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