For many university seniors, January marks the beginning of panic season. After all, January is the beginning of the end, right? From what I’ve observed, a graduating class of university seniors is comprised of Group A and Group B. Group A seniors know exactly what their post-graduation plans are, and Group B seniors are too busy trying to hide the sweat stains on their graduation gowns because they haven’t got a clue. Regardless of where you fall on this spectrum, chances are you will start your career in sales.
If this is going to be you, listen up. If you recently graduated and are in sales now, or if you’re making the jump to a sales role soon, listen up. What the media portrays about sales and the significance on aggressively closing using sneaky tactics is misleading. In a competitive function with high turnover and high expectations, its important you understand the following sales secrets to help you blow your competition out of the water.
The following content is synthesized from a chapter within Neil Rackham’s S.P.I.N. Selling. As I read through this chapter, I couldn’t stop thinking of how useful this content would be to someone new in sales. I also couldn’t stop thinking about how only a select few will actually read this book. So, I decided to do the work for you. All you need to do is spend 5 minutes reading this to uncover the truth behind closing.
Closing in Small vs. Large Sales
Before we go any further, let’s make sure we’re on the same page. Rackham and his group of researchers define closing as a behavior used by the seller which implies or invites a commitment, so that the buyer’s next statement accepts or denies the commitment. For example, the “standing-room-only” close:
Seller: “Mr., our product is in very high demand. You can purchase one today, but if you wait until next week there could be a several month delay.”
This is only one example, but there are hundreds of books on different closing techniques. For context, Rackham’s initial studies took place in the 60s, and the average price of a large sale was recorded at $109. With the help of this nifty inflation calculator, we can assume the 2015 equivalent to the 1965 $109 is roughly $820. To keep things simple, we’ll define a small sale as anything below $800 and alarge sale as anything above $800.
Time to turn off your Spotify and put pen to paper. Rackham’s studies produced two conclusions:
- Closing techniques speed up the length of a transaction.
- Closing techniques increase the chances of making a sale with a low-priced product, but reduce the chances of making a sale with a high-priced product.
Note: If you’d like further explanation, please pick up a copy of this fantastic book and read it. Here’s why you should care about this:
- If you are going to be selling or are selling something on the low-price, low-value side of the spectrum in an environment that requires as many customer-facing interactions as possible (i.e. door-to-door sales), you could consider studying closing techniques.
- If you are going to be selling or are selling something on the high-price, high-value side of the spectrum in an environment that requires complex conversations with key decision makers (i.e. business-to-business sales), you could consider throwing out your copy of Sleazy Closing Techniques for Dummies (I really hope this isn’t an actual book).
“But, Austin, how am I supposed to close deals for this new software sales job I got with [insert Fortune 100 company name here] if I shouldn’t use sleazy closing techniques?”
What a great question! Let’s take a look at what the research says when it comes to closing success in large sales.
Of the thousands of sales calls Rackham and his team studied, they concluded there are four possible outcomes in large sales. We’re going to focus on the two below you may be unsure of: continuations and advances.
A continuation is where the sale will continue but where no specific action has been agreed upon by the customer to move it forward.
Rackham’s team found inexperienced sales people often mistake a continuation as a successful sales call. At first glance, this seems like a logical assumption for the salesperson to make. However, the issue with a continuation is that no specific action has been agreed upon, and that means there is no tangible plan to move the sale forward. Claims like “That was a great presentation” or “I’m very impressed” are simply words and not actions. From studying thousands of sales calls on both the selling and buying side, Rackham repeatedly found buyers using positive feedback as a way to politely end the conversation. This concept isn’t rocket science. Can you think about a time when you’ve been polite as a way to get a salesperson out of your face? You just continuation-ed that fool.
The key is to recognize that positive feedback is not enough. Although refreshing to hear, positive feedback is only noise; not action. So how can you leverage a buyer’s positive noise into an agreed upon action?
An advance is where an event takes place, either in the call or after it, that moves the sale forward toward a decision.
For example, when I was interning with a strategy consulting firm one summer, I had to qualify leads over the phone. My only objectives were to perform a high-level assessment of their organization’s need for our services, briefly introduce our firm to them and set them up for a call with our business development director. Where is the advance in this scenario? Setting up another call to move the sale forward. In business-to-business sales, an advance will often be the primary closing objective. Chances are implementing a new IT system for a 200+ person organization will require more than one meeting, as one example.
The key is to know exactly what direction you need to advance in to move the sale forward. Do you need to speak with someone with more decision-making authority? Do you need your engineers to meet with their senior leadership to explain the technical details? Whatever the objective is, your sales call isn’t considered a success unless that objective is met (or, of course, you have mind control powers and you get the sale).
Let’s tie this all together in a simple three step formula so you can apply this in your world.
Your Prescription for Success
To recap, there is a high likelihood of beginning your career in sales. Unfortunately, the media has conditioned us to believe success in a sales role is only possible if you slick your hair back and spew out lies. Thankfully, we have real world research that helps us distinguish when closing techniques work and when they don’t. So, where do you go from here?
Time to shine, get after it!