Mark Jewell's Blog: Selling Energy, page 224

Ask Prospects the Right Questions, Then Listen Carefully to the Answers

“Most people think ‘selling’ is the same as ‘talking’. But the most effective salespeople know that listening is the most important part of their job.” – Roy Bartell

If you’re meeting with a prospect and you want to put your best foot forward, you have to not only ask the right questions, but also listen carefully to what you’re hearing in response. You may discern details that you can use to tailor your future conversations or proposals to resonate with their needs and desires.

You should limit the amount of closed questions you use – these are questions that elicit a “yes” or “no” response. They’re generally used for testing understanding or knowledge, concluding a discussion, or making a decision. They’re good for setting the frame for open questions – or probing questions – that you’ll use to find out more detail. The responses to these open questions may very well reveal the information you need to make a compelling case for change.

When speaking with your prospect, listen for words they choose to repeat. There are two reasons such repetition matters. First, the word(s) that the prospect is repeating may provide insight into why he or she has not moved forward already. Second, if someone frequently uses a favorite word or phrase, you might consider slipping that exact word or phrase into your half of the dialogue. This type of verbal mirroring helps build rapport, a vital factor in setting the stage for agreement.

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Energy Efficiency Retains Tenants

There’s a strong correlation between energy efficiency and tenant retention. If you think about the benefits of energy efficiency from a non-financial perspective, it makes perfect sense that an efficient building would yield happy tenants – and ones that would be more eager to renew their leases. Efficient buildings are simply more comfortable and attractive. If the tenants are paying their share of the utility bill, then there’s also a financial benefit that they would likely lose by moving to a less-efficient building.  And if they are performing work that would benefit from more effective lighting, thermal comfort, etc., then they would likely also enjoy non-utility-cost financial benefits (e.g., lower scrap rate, fewer clerical errors, or lower absenteeism).

Today, I’d like to share an article with you that succinctly and effectively conveys the value of tenant retention. This article, written in 1992 for BOMA’s Skylines magazine by Richard C. Mallory and Anton N. Natsis, was titled “Tenant Retention in the ‘90s.” At the time, the real estate business was so terrible that the mantra of developers was, “Stay Alive ’til ‘95.” 1992 was right in the middle of that roughly five-year real estate recession and the cost of tenant turnover at that time was truly shocking.

The authors asserted that if you had an existing tenant paying $2.35/SF/month who was wavering about renewing its lease, reducing that existing tenant’s lease to $0.95/SF/month to prevent turnover would be equivalent to charging a replacement tenant $2.35/SF/month. Why? Because there are so many costs involved with tenant turnover (e.g., leasing commission, build-out vacancy, free rent period, tenant fit-out allowance) without even considering the rental revenue lost while you’re waiting to attract the new tenant.

The real estate climate has obviously changed in the last 25 years; however, tenant turnover is still very costly for a landlord. If you’re selling efficiency products in a commercial real estate setting, be sure to include this concept in your value proposition – and back it up with facts.

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Reframe the Benefits

Today, we’ll continue with step three of “The 3-Step Process of Informed Selling” – how to reframe efficiency so that the savings or benefits of a given project help a prospect satisfy some other goal or desire. If your prospect is family-oriented, it’s likely that they value leisure time and want to maximize the hours that they have away from work – hours that can be spent enjoying time with their family. You may be able to reframe the benefits of your efficiency project so they resonate with this value by comparing the amount of money that your project would save them with the cost of fun family activities (such as vacations, tickets to see movies or shows, etc.).

One of the best examples I’ve heard of this kind of reframing comes from a top-performing sales professional in Connecticut. For the sake of anonymity, we’ll call him Bruce. Bruce told me, “You know, I use the same winning sales strategies that I use in my work when I go home to my wife. My wife was recently interested in buying a station wagon for the family, and she wanted the Subaru Outback (which is far from the cheapest alternative). She told me that she’d always admired the Subaru from afar and that she really wanted to own one.”

So Bruce said, “Honey, that’s a really expensive car. We could certainly get by with that used Saturn station wagon we saw at CarMax the other day.” She said, “Well, I drive the kids around all day. I’m in the car a lot and I really want a Subaru.” Bruce responded, “It’s $60 more a month…” She said, “That’s fine. It’s just $2 a day – not a big deal.”

Before I continue with this story, let me stop and remind you that people don’t make decisions; they make comparisons. The minute she heard $60, she was likely thinking, “That’s just $2 a day… that’s half of what I spend on a cup of coffee at Starbucks every morning.”

Bruce, being a sales professional (as opposed to a salesperson) says to his wife, “Wait a second, Honey. You know, we’ve been looking at Jet Skis for the family and if we actually bought one, the payment on it would be about $60 a month. So, which would you rather have, the Subaru Outback and no Jet Ski, or the more reasonably priced station wagon and the Jet Ski so our kids can learn to do watersports at our lake house?”

As soon as he reframed that $60 from, “Eh, it’s $2 a day,” into, “Wow, that’s a filmable moment every weekend with my kids on a Jet Ski… memories that we’ll have forever,” you can imagine what car they agreed to drive home the following weekend… and you can also imagine what it was pulling: that Jet Ski on a trailer!

Now, this story isn’t about an efficiency sales situation; however, it certainly underscores the fact that comparisons really do drive decisions. It’s your job to frame each comparison optimally so that the most likely outcome is a thumbs-up for your proposed project.

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Scaling It Up

What is scaling, exactly?  In business terms, it means spreading effective practices throughout a company, which seems pretty straightforward.  Chances are most of your experiences with scaling have been simple and uncomplicated – inspirational posters, emails, checklists and the occasional “pep” meeting.  However, at the end of the day most of the things just don’t cut it.  Successfully scaling a company is complex and requires a lot of time and perseverance.

In Robert Sutton and Huggy Rao’s Scaling Up Excellence, you’re provided with a game plan for how to infuse your organization with the best everyone can offer.  It requires a lot streamlining as well as flexibility, and yes – mistakes will inevitably be made (in some of their examples, even Google and Pixar step in it!).   If you’re engaged, open-minded and committed to the long haul, then this is the book for you.  It takes time for a company to change, but you just might be the right person to do it.

Here is the summary from Amazon:

“Bestselling author, Robert Sutton and Stanford colleague Huggy Rao tackle a challenge that determines every organization’s success: how to scale up farther, faster, and more effectively as an organization grows.

“Sutton and Rao have devoted much of the last decade to uncovering what it takes to build and uncover pockets of exemplary performance, to help spread them, and to keep recharging organizations with ever better work practices. Drawing on inside accounts and case studies and academic research from a wealth of industries – including start-ups, pharmaceuticals, airlines, retail, financial services, high-tech, education, non-profits, government, and healthcare – Sutton and Rao identify the key scaling challepnges that confront every organization.  They tackle the difficult trade-offs that organizations must make between whether to encourage individualized aproaches tailored to local needs or to replicate the same practices and customs as an organization or program expands. They reveal how the best leaders and teams develop, spread, and instill the right mindsets in their people – rather than ruining or watering down the very things that have fueled successful growth in the past. They unpack the principles that help to cascade excellence throughout an organization, as well as show how to eliminate destructive beliefs and behaviors that will hold them back.

“Scaling Up Excellence is the first major business book devoted to this universal and vexing challenge and it is destined to become the standard bearer in the field.”

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Weekly Recap, December 3, 2017

Monday: Read Learning to Succeed: Rethinking Corporate Education in a World of Unrelenting Change, by Jason Wingard, which argues that every organization should place a high value on learning and knowledge.


Tuesday: Check out the “question trilogy” in order to learn what your prospects needs from you before he or she is willing to buy.


Wednesday: Learn to get into your prospect’s shoes to figure out exactly what each prospect cares most about and work it into your proposal.


Thursday: Don’t let opportunities pass you by for lack of certainty.


Friday: Explore step two of the “The 3-Step Process of Informed Selling” – Research.


Saturday: Check out this article on how impactful memories need to be made, namely through pushing yourself out of your comfort zone.

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Memories

What are some of the most impactful memories in your life?  A graduation?  First love?  A major success?  What is it about these moments that make them so special?

According to Eric Barker (author of Barking Up the Wrong Tree), research has shown our most treasured memories happen between the ages of 15 to 30.  This is because after reaching a certain stage in life, comfort is achieved and our lives turn stagnant.  Because of this, impactful memories need to be made, namely through pushing yourself out of your comfort zone.  You can read more about how to do this on Barker’s blog.

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Invest Your Time

Last week we discussed “The 3-Step Process of Informed Selling”. Today’s blog we will focus on step two of the process – Research. Before you meet with a decision-maker, you need to do some behind-the-scenes research. You need to dig up any and all information that will help you connect the dots for your prospect. The following scenario – shared by an attendee at one of our trainings – proves the point.

Chris (not his real name) was hoping to convince the owner of a local hotel to upgrade his air conditioning system, which was well past its useful life but still operating thanks to a lot of maintenance and crossed fingers. The hotel in question was located in Central California, a place where temperatures soar in the summertime. Chris knew that the current AC system was no longer able to maintain design temperature in the hot summer months – both the hotel’s engineer and the front desk manager had shared that several guests had given them each an earful lately on how their rooms were hotter than they bargained for. Unfortunately, the hotel’s owner was out-of-state and not inclined to spend any money on this particular property.  He was concerned about the Central California economy and had decided to limit any further capital investments in his properties there. Chris knew he needed to compile an inarguable case for upgrading the AC… something that would “shake the Etch-A-Sketch” for this out-of-state owner and draw a new picture that would shake loose some capital.

So what did Chris do?  He first paid a visit to the hotel’s night auditor. Why the night auditor?  Because he’s the person who has first-hand knowledge of how many rooms they’ve rented in the preceding days, weeks and months.  He is the person who knows in which direction the average daily room rate has been trending over time.  He has a keen understanding of the hotel’s break-even point.  Bottom line: the night auditor was Chris’ ticket to understanding the impact that AC-related declines in occupancy might be having on this hotel’s P&L.

Chris explained, “Listen, I’m working with the owner to evaluate some potential capital improvements and a question popped into my mind the other day that I bet you could help me with.  Have you noticed any trends in occupancy in this hotel in the last six months?”

Alas, much to Chris’ satisfaction, the night auditor shared with him that occupancy had been consistently falling over the last few months; they were now almost $40,000 a month lower in income compared to last year’s figures.  Chris then circled back with the front desk manager, a couple local travel agents, and a few other folks in the community.  Guess what?  The word on the street was that this hotel could no longer maintain design temperature in the hottest summer months.  People now knew the property as “the hot hotel” – and by “hot hotel,” they didn’t mean the latest “must-visit” boutique property!

Shortly thereafter, Chris called the owner and laid out the facts.  “You say you don’t want to spend $250K upgrading your AC… Well guess what?   For the last few months, you’ve actually been paying for the system that you refuse to buy.”  When the owner replied, “How’s that?” Chris shared the results of his conversations with the night auditor, front desk manager, and others in the community.  “Whether you know it or not, you’re on a glide path to lose a quarter of a million dollars in lost room nights (which happens to be the entire cost of the AC system I recommended to you last month) because word on the street is that you can’t control temperature during the summer months.” He continued, “What do you think is going to happen when hotels.com or Yelp picks up on the fact that your property is ‘hot’ – and not in a good sense? The locals already know it, which is why you’re seeing less people referring visitors to your property.  What happens the next time someone from hotels.com drops in for a summer night and you get dinged a couple stars because your rooms aren’t cool enough?  Now your $40K-a-month loss becomes even larger.  And at what point do the lost room nights put you below break-even?”

As you might imagine, this carefully assembled information, presented in such a compelling manner, did the trick.  The hotel owner would be crazy not to take action when presented with the reality that the room nights his property had been losing represented more than the debt service on a new AC system.

The moral of the story?  It’s all about having the insight and persistence to go behind the scenes and get tactical information that you can then communicate to the person who has the power to effect change. Even the most reluctant prospect can become a buyer if you invest the time to research and connect the dots for them.

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Risk vs. Certainty

If you analyze the historical business decisions of any successful organization, you would surely find that many of those decisions involved risk. True innovators go beyond the line of safety and take a leap of faith into unknown territory. While this leap is usually well planned and calculated, it’s risky nonetheless.

As productivity blogger Seth Godin says, “Risk and certainty run contradictory to each other.” If you fail to make a decision because you’re waiting for 100% certainty that it is the right move, you’re going to stagnate. You’re also going to waste valuable time that could otherwise be spent growing and developing your business.

Bottom line, risks should not always be avoided. Yes, they should be carefully thought out and weighed against the potential consequences; however, they’re a necessary part of growth and progress. Don’t let opportunities pass you by for lack of certainty.

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Get into Your Prospect’s Shoes

It may sound simple, but one of the best strategies for determining the ideal sales approach for a given prospect is to get into their shoes. There is no universal sales strategy that works across the board, so you need to figure out exactly what each prospect cares most about and work that angle into your proposal. So how do you do this? Talk to people. Talk to store owners, building managers, hoteliers, even manufacturers. Ask them, “What would make your life easier?”

I’ve had the opportunity to teach a lot of eco-entrepreneurs – people that go out there with new inventions, new ideas, new twists on an old theme.  I ask each of them, “What do your potential customers think?” The response I hear is often, “Well, we haven’t really talked to anybody yet because we don’t want anyone to steal our idea.”

As a serial entrepreneur, I certainly understand the concept of protecting intellectual property. That said you can’t build a business without exiting stealth mode before you declare your offering is ready for sale. You have to get out there and talk with your future customers and figure out what they really care about. Otherwise you’ll wind up with a product that’s the equivalent of a car with four square wheels. You’re going to wonder why you went out of business and why you ran out of capital before reaching profitability. Before you launch a business, you have to talk to people and tailor your business model to offer something that your targeted prospects would actually buy.

The implications for energy-focused sales professionals is obvious. You need to talk to your prospective customers. If you ask the right questions – and listen carefully to their answers – you’ll learn exactly what they would value and how they would prefer to buy it.

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Question Trilogy

It’s crucial to learn what your prospect needs from you before he or she is willing to buy. One of the best ways to find out this information is by asking what I call the “question trilogy”:

Question 1: “How many energy projects have been proposed here in the last <<>> years?” Just as they say that there is no music without silence between the notes, when you ask an important question that requires heavy thought, just zip it. Put your pencil to your notepad so that they know this no time to B.S. because you’re going to write down what they tell you. Assuming they have had proposals in the past, move on to question two.

Question 2: “How many of those projects have been approved?” Again, give them time to think. After they give you a figure, move on to question three.

Question 3: “What was it about those projects that made you and your colleagues willing to approve them?” This is the golden question that will provide your insight into their values and decision-making process.

The earlier you ask these questions in the sales process, the better. You might learn that you have no chance closing a sale because the prospect is already loyal to another vendor. In this case, you should just pack up and move on to a different prospect.  (You might leave the door open by suggesting that you’d like them to consider you to be a valued “#2” vendor in case their present vendor ever finds itself unable to provide the level of service that your prospect has come to expect from them.) Or you might learn that they only work with vendors who can provide a certain service that they value… if you are able to provide them with this service, it should be front and center in your presentation going forward. Listen to what they have to say, take note of it, and tailor your proposal to fit their needs.

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