I received a great email from a Sales Director the other day.

He was in charge of the sales operation for a B2B engineering firm and he was dipping his toe into employing some telesales staff to set appointments for his field sales teams.

“Sean, how do I set the commission levels for my telesales people? I’d like to offer them a % when a deal is completed and the money is in the bank i.e they do not get paid by appointment but instead they get a % of sales revenue made from the deal if it is made from the field sales rep. Is this the best way to go around this? Look forward to your guidance as always”
Bill Shepherd

Here’s my take on this:

Yes, I have some thoughts in this, although I’m not sure if you will agree!

My take on this comes from me being on all sides of the fence; a professional telemarketing executive setting appointments for an outside sales people; an outside sales person running appointments set by someone else and as a sales manager and owner who had to pay the commissions and costs all the way around. Also, as a telemarketing services company where all we did was set appointments for other companies.

Here is my take on this:

As a professional telephone sales person responsible to set appointments only, I would never, ever have my commission rely on closed sales or receipts. And as an owner-manager, I also found that to be the thing to avoid.

At first glance it looks like the most logical and cost effective thing to do; but it is a mirage. I know it looks like that if you pay the setter out
of closed sales and actually income, that you can’t lose…but it is the reverse. And most people start out their telemarketing programs with this
thinking.

Let me try to give you a couple of the problems with this set up, from an owner/manager view:

First, when the telemarketing sales rep (TSR) knows that their real income depends on the direct sales person (DSR), it causes a ton of problems.

1. First the TSR has no feeling of control over his or her destiny and income. This is one of the core principles we teach in our sales training courses, that you are in control and that you work via science, not luck. But if your income depends largely on someone else, it kills the whole concept.

2. Whenever the DSR misses sales that the TSR thought should have closed, a natural resentment and animosity HAS to develop. There will be times when the person on the phone sounds like a pure lay down, just waiting for the DSR to get there. The TSR is so excited, they mentally spend the
commissions. The DSR does not close the sale. There is a big problem and this will happen everyday. You and I know that what a prospect sounds like
on the telephone really means nothing. With that in mind the reverse situation also causes problems…

3. The TSR does what we teach is one of the biggest mistakes in setting appointments: They will try to make the sale instead of just setting the
appointment. Because their income is based on the sale, then the TSR HAS to think about that sale and will begin to make judgments about what prospects will buy and who will not. This creates two real serious, even detrimental problems:

a. The TSR, without the knowledge or experience of the DSR, lets tons of qualified prospects the slip away, because they don’t think the person will buy. The prospect did not SOUND good enough so the TSR let it go. You will lose tons of money in lost opportunities that you could have closed.

b. Even those they go after strongly, they lose most of because they are trying to make the sale instead of selling the appointment only. The
commission structure forces them to think that way.

4. The TSRs will begin to want to know what DSR will run their appointments. They will want to set appointments for the “best closer” for instance, and not someone else.

5. When the TSR is also paid on receipts, their fate also now lies in the hands of the firm’s billing and invoicing practices, collections, delivery systems and everything else. They MUST feel that although they are the ones who do the most important thing: get the prospect to agree to listen to your
story, they get paid last and least.

There are a host of other serious problems with that system, but once you begin to think on these lines, you’ll see what they are yourself.

So what do you do?

You want the TSR to do one thing only: Sell the appointment and pay them on qualified appointments that consummate–only. Their job is to set a solid appointment with qualified prospects and that is what they get paid to do.

Now, you have to “define” exactly what constitutes a “qualified appointment,” such as the true DM must be present, they must have one hour
for a presentation, the company must have X amount of employees, whatever.

But you do not want any qualifying issues that force the TSR to have to make a judgment call. Once the DSR walks in and shakes hands with the qualified DM–that’s it–the TSR gets paid.

Ok, so how do you do this without losing your shirt or putting up too much money in advance?

Just like we teach in the Science Of Selling, you want to figure out the “value” of a qualified appointment and pay the TSR a commission based on that. If you have not been out in the field closing like this, you will need to make some hypothesis, but I’m sure you can get close.

For example, if you figure that your field sales teams will close 20% (and you can start with low estimates) and that the average new customer will
generate £5,000 on an initial contract, then you know that if you run 10 appointments, you will close 2 and bring in £10,000. So the average
appointment actually brings in £1,000. Hence the “SALE” that the TSR makes brings in £1,000. I now pay a commission on that £1,000 sale, which could be 10% or £100 (or whatever) per every good appointment set/consummated.

You can also figure in any salary, taking into consideration the anticipated closing rate of the TSR. In other words; if you think the TSR will set 10 in a month for a total of £10,000 and you already pay £1500 a month in salary, you can adjust the commission to say £50 per appointment.

For additional incentives and bonuses, you want to direct the TSR toward more effective targeting: i.e: more appointments with targeted companies, or
more set appointments in the same area within the same week, or appointments with companies who have over 20 sales people, etc. etc.

Other bonuses might include paying them a bonus on the amount of qualified DMs they get to do something else beside set an appointment; something that moves the prospect closer or at least keeps them in the fold.

For instance, perhaps they can get the prospect to open an account on the web site or agree to have some of their sales people take a “sample” assessment test online or agree to a newsletter or something else.

I know this may look like it is risky at first glance, but please believe the other way around is far worst.

When you set up a system where the telemarketing executive gets paid only for what he or she is responsible for–setting a good, solid appointment,
then everything we teach comes true. You get a TSR who is proud and confident and professional and who knows how to concentrate on just getting
you and your people in front of the right people the right time. They sell the appointment only and not the service on the phone and hence they set a
hundred times MORE appointments.

I did this so effectively with my company that I was actually able to guarantee to my clients the quality of the appointments we set for them.
When other telemarketing firms where charging by the hour–regardless of the amount of appointments they set or the quality of those appointments–I was charging by the appointment and only those appointments that consummated.

The client paid only for the number of appointments they received and if any of those were not qualified as per our contract or if any no-showed–there
was no charge!!

Anyway, I hope this helps, Bill. I’m excited for you and this initiative–a great step. Also, it is good that the telephone person have some outside
sales experience. If not, I always give the TSRs field sales training and a look into the life of the DSR. One of the problems that comes up is that the TSR really does not understand what the out side sales executives do or how they do it.

I hope this helps!

Sean Mc

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Let me ask you a question: up to this moment, how much time have you spent on perfecting and learning your craft as a professional sales person?

I mean, if you added up all of the time you spent in sales training classes and all of the time you spent reading sales training material and books and every minute you invested in doing your own homework on your industry and competition and on your product, if you added all of those hours up, how much would it come to?

Think about that carefully, and please, don’t lie to yourself.

You can lie to me or your boss or your spouse, but don’t lie to yourself. Add up all of the time you believe you have spent on learning the profession of selling. This does not have to be with only one company, either. Add up all of the sales training and sales related learning you have done in your whole career.

How many hours does your actual training come to?

Forty hours? Fifty? A hundred? Now divide that by the number of years you have been in the business and what do you get? Do you know that I spend on average around 30 – 40 days per year in improving my skills? Yes, you heard it right – I spend 30 – 40 days per year. Here’s how.

On average, I spend 1 hour in my car traveling to work and to appointments each day and on every single occasion without fail my friend I listen to sales improvement CD’s, personal development programmes, leadership, management, marketing, strategic planning, NLP – you name it! And then there are the courses and seminars that I attend too. You see, I take my own self development very seriously. I want to be the best and therefore I train to be the best.

I would even imagine that the average sales person only spends about 10 to 20 hours a year or so on actual training for their profession. And that includes listening to programs like this. Now, remember I said quite boldly that the average entry-level sales person should earn more than the average entry-level lawyer or doctor. So, let’s look at the doctor and the lawyer in retrospect.

How many hours do you think the average medical doctor or lawyer spends learning their craft and training in their profession by the time they reach five years in the business?

Well, first of all, we are looking at about a few years in actual schooling and internship BEFORE they earn the degrees needed to practice their profession. So, if you look at going to University or College for 3 years and attending classes at least 200 days per year, and sitting in class at least four hours a day, not counting homework, then we are talking about roughly 800 to 1,000 hours! per year. And that is before they go to work!! By the time these people reach five years in business, you’re talking about around 4 to 5,000 hours of training and learning. And they continue to learn, with many going on to earn PHDs in their field totaling twelve years or some 10,000 hours of very specific and directed learning and training in their profession.

Now, does it make any sense that you, with a whopping 40 hours of learning, that you should earn what a person with 10,000 hours dedicated to his or her profession earns? Can you see why you don’t earn what other professionals earn? You see, the amount of time that you invest into perfecting your craft has a direct correlation on what you earn.

Happy Selling!

Sean Mc

This is a long un, but a good un!

I just received a question from a sales person called Jack.

Jack wanted to know, among other things, how many times we should be contacting prospects and clients without coming across as desperate.

Here’s Jack’s question:

Hi Sean,

I have been subscribing for a while and look through your sales tips regularly, I find a lot of them helpful/successful and often entertaining!! If at all possible could you delve into your encyclopaedic mind and find some tips regarding follow up calls to prospective new clients. I find I can draw business from around 8% of people I speak to “as long as they’re the right person” once they have perused our pricelist list and found that we are drastically cheaper than our competitors (even though price isn’t always the most important thing). I would like to increase my success rate and I think I let myself down on the follow up calls, maybe I am too impatient but for outbound sales people it is important to keep sale up and regular! Any advice would be vastly appreciate. After all “a sale a day keeps the MD away”!

First and formost is the initial ‘cold call’ once we’ve found the right person to speak with, I ask/check what equipment they have (I usually already know.. so I am just re-confimring!) then send them the consumable prices via email, we are usually the cheapest and if not I can make it so! So yes in brief I am chasing the prospect!

The most difficult thing in our industry is to get the initial sale; should I push for it without seeming desperate or play it cool? It’s more of a time management issue, the products we sell use up approx every 4-6 weeks and often I feel with a new prospect I have to catch them when they need my product.

On another note RETENTION!

The most important thing to me is customer retention, but often I get the feeling I am ‘bugging them’ for orders too! How often should I contact xisting customers? Once a week, once a month. It’s not easy tell how long our products will last (not that their ‘dodgy’ or anything…lol)

Maybe I should let them know how often I will contact them.

I found that sending a email, with a read receipt and if no response within a day or so if I gave the customer a call it often worked.

I have about 40 - 60 regulars, and want to gain at-least 5 new clients per month.

Regards

Jack

———————————————————-

My thoughts on this:

Hi Jack,

Ok, let me start by first doing what we should all do in selling anything; and that is correctly to identify the problem. Let me see if I can narrow down your concerns and questions:

1. Using the call-mail-call approach, you first cold call
the prospect, confirm and qualify the DM, then send
literature/price list via email. Then on the follow up
call, it seems the prospect becomes harder to get on the
telephone than when you cold-called, forcing you to have to
chase them.

2. In that information price package, you clearly sell or
empathize that you have more than competitive prices, with
the hopes of garnering interest, even though that is not
your only selling point.

3. When you do get the prospect on the telephone on that
second, warm call; closing the initial sale is difficult
and conversion percentages are low.

4. Even after you have closed for the initial sale,
retention rates are low and you often feel as though
you are “pestering” the customer to call often for the
second and third sale.

5. In short, follow-up call-to-customer rates are low
as well as customer-to-client percentages.

Does this sound about right?

This is a common scenario, especially when selling inventory-type products as a “supplier” where the product is nearly or exactly identical to the competition, pricing is cut-through and getting a customer to “switch” or to change suppliers is difficult.

All of these issues though result from the same source: the philosophy of the approach.

Here is what I mean.

First, it is most likely that the literature/price package you email or send to the prospect provides far too much information. Inadvertently (or deliberately) you are trying to make the sale in the brochure and pricing list.

If your business is such that you get most of your sales from customers calling in to place orders via a web site or catalog, then this may be the approach. However, if you must get the prospect on the telephone or in person to close sales, then you can not provide too much information.

When your pricing pack gives the prospect all of the information they need to know: all products, all pricing, all services and shipping info, and
everything else, then why do they need to speak to you?

You have given the prospect everything he or she needs to know to make a decision. You have forced the prospect to make a buying decision based on the information and pricing. You have effectively removed yourself from the sales process.

If you must close on the telephone, then your information package must sell ONLY that next step—that next follow up phone call—-and not the products. You need to provide enough information to inform the prospect that you do indeed have the tools and supplies that they need; that
you do have the better prices and the better service; but you cannot try to make the sale. Your information has to point to the next step—the follow up call.

One way to do this is to stress “personalized” or “customized” orders. In other words, when you sell via a type of catalogue or price list, all the customer has to do is pick what they need and order it. But instead you should stress that unlike your competitors, your products come with “personal service.” That you do not just sell the item in the catalog; that you play an active role in insuring that the item is the perfect fit and ways to help combine orders for maximize savings.

You are not just selling these items; you are a consultant who will HELP the prospect save not only money, but time and headaches. You are going to take the “responsibility” of making sure their supplies are always up to date.

Unlike her current supplier, you will be there (calling, checking) constantly, almost like you have an office in the building, making sure they never run low. When they place an order with you, they—HIRE YOU— they do not just buy the item.

In your initial price-pack, you need to stress that while these “low” prices are great, they represent only your
“standard-off-the-shelf” numbers. However, you do not sell in that manner. Your customers do not simply order from
the list, like with other companies—No! All of your “clients” receive a personalized, customized proposal; they receive a long-term
“program”, uniquely designed exclusively for them and them ONLY. You, as an industry authority, as an expert, realize that
no two clients are exactly alike and you take the time to get to know everything about them, so you can provide for their
needs—before they arise!

You may note, that if you take this approach, not only do you “set up” the follow up call, but you automatically eliminate the problem of “pestering”
customers to get reorders. That fact that you will call and stay in close contact is part of the service you strongly sell right from the start!

You see, if you are calling just to get another order, if you are calling because you are too inpatient to wait until the customer’s supplies to exhaust, if you are calling just to make a another sale and get another commission—then you are correct—you area pesky telemarketer who is bugging them and they don’t like it.

However, if your true motivation is to provide excellent service; if your reason for calling is that you are concerned; you care about them and you want to make sure that they never have to worry or ever run low, if the reason for you calling is for THEIR benefit—then you are a high-level professional sales expert that is checking on their well-being and the love it!

Also, let me give you one note on making that follow up call that could also be causing a problem. You want to be careful of the very first words of that follow up call. Most sales people when using this approach, the first thing they say when they get the DM on the telephone is they
confirm the literature with something like this, “Hi Mr. Prospect, Steven Graham with ABC Tools—I sent you some information a few days ago, have you had a chance to look
at it?”

This all too common opening appears to be innocent, simple and common sense. However, it is a critical mistake. When you ask this question, you force the prospect to:

1. Have to had read the literature or

2. Have to remember the package and/or

3. Have to explain to you why he or she did not
read it yet—he has to explain why he is causing the delay.

This is why you hear prospects respond with, “Well, I ah…I’ve been really busy…” or “I’ve been out of the office…” etc.

The prospect feels compelled to justify their inaction.

Think about that: within a few seconds the prospect is under pressure to have to explain their actions to you and this immediately sets up a defensive posture: it creates an adversarial relationship.

Don’t ask them about the information you sent.

Just refer to it, and continue, “Hi Mr. Prospect, Steven Graham with ABC Tools, how’ve you been? —- As we discussed the last time we spoke, I’m getting back to you about the information I sent, and as you can see…”

So, first, you do not want to try to close sales in the literature—tone it down and do not provide too much information.

Stress and sell ONLY the next step—the follow up call.

Let the prospect know that you will be contacting them to design a personalized proposal so they can see what you REALLY do.

Inform them that in the next step – a short telephone call—you will show them why even with HIGHER prices—you are the leader.

Make the fact that you will “be there” constantly a positive selling point. Stress the fact that you take a personal interest in making sure they never have to call YOU. And on that follow up call—do not put the prospect on the defence by asking if they read or recall the information you sent.

This altered philosophy, this way of thinking, this altered view of the process will help you immediately increase the percentage of completed follow up calls, the closing rate of follow up call conversation and ultimately, your overall retention rate—turning more prospects into customers, and
more customers into long term clients!

——————————————————-

Have you got any sales training requirements in mind?

If so, please click below and let me know: http://www.mtdsalestraining.com/enquiry.html

Happy selling!

Thanks again

Sean Mc

I’ve just got to tell you about two of the worst examples of selling that I have come across in a long time!

Poor Example # 1

“The Garden Centre Waffler”

My wife and I were looking around a garden centre when we were admiring a garden table and chairs for our patio. We have literally just walked up to and said to each “this is nice” when a sales person pounced! He then went on to talk about the features and benefits of the product for the next 5 minutes solid, I’m not joking here, 5 minutes of waffle! “It’s £1,495 and it’s got this and that, it’s made out of this wood and has a 5 year warranty”.

He went on and on and on and …..

At the end I said “Thanks for all of that but we have already got this table” (Sorry, me playing devils advocate. We hadn’t really) “You’ve just wasted 5 minutes when you could be selling to someone who needs it. Qualify me first and then ask questions”

All in all we must have spoke no less than 5% of the time and he never asked me one question. Not one!

Learn from that sales lesson and please do not just show up and throw up over me!

TIME OUT TIME OUT TIME OUT

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TIME OUT TIME OUT TIME OUT

Poor Example # 2

“The Business Development Manager Jinx!”

So there I am, interviewing for a BDM role.

“If they can’t sell me at an interview, they’ve got not chance out there in the real world!” I thinking to myself.

This is a funny story…

Jo (name changed to protect the innocent actually said this to me):

“Well, I started my employment in 1988 where I was Junior Sales Assistant with XYZ but they went bust in 1991 so I moved to ABC company and worked there as a Business Development Manager for 7 years until they had to call in the receivers. I moved across to Peugoet then in 1998 and worked there until 2004 before being made redundant and in the last two years I have held 2 sales positions”

My reply:

“So every company who you have worked for has gone bust right?”

Yeah, like I was going to employ that lady! There would be no more sales tips like these in 6 months time!

Honesty is one thing and I applaud her for that but “selling her skills” in that way was awful!

Next!

Happy selling and make sure you do not make the same mistakes that I mentioned above!

Sean

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Here’s a question I got asked last week from a sales person who receives my weekly free sales tips:

“Sean, I hate it when you call or email your prospects and they never return your calls! It’s so frustrating. Can you advise anything? Thanks as always - Jeff G”

Here’s what I think:

You send an email, but the prospect does not respond. You then call and leave a message, but also no reply. You try to remain positive, but after few more attempts it seems that this prospect that was so interested will not return your calls. What is happening?!

Does this sound familiar?

I constantly have sales people asking how can they get prospects to return phone calls and emails, and the answer is simple: Only sell the return call or the email.

In every stage of your sales process, you should have but ONE objective. If you are calling to set an appointment—then sell only the appointment. If you are calling to get a return call—then sell only the return call. Typically, sales people try to sell everything at once.

Look at this example:

Tracy Drew of ABC Technologies is calling referrals from her customer, Lisa Jones.

There’s no answer so it goes to answer phone.

Sales Person:
“Hi Mr. Prospect, my name is Tracy Drew with ABC Technologies. Lisa Jones of XYZ suggested that I call. ABC Technologies sells the best techno-stuff and we can help you. Lisa bought some of our stuff and she thought you might want some too. So, I am calling to see when we can set up a time to meet and I can show you some stuff. Our stuff is the best in the industry and Lisa agrees. So, please call me at 0800 849 6732 or email me at tracydrew@techno.com. I will be in your area next week, so anytime then would be good or anytime at your convenience. Thank you…”

This sales person tried to sell:

1. Her company
2. Her products
3. The appointment
4. The referral value
5. The appointment time
6. Justification of the product
7. Industry recognition
8. Her reputation and more

The last thing she sold was the return phone call!! And guess what? No call back.

Often the sales person forces the prospect to make a big buying decision, instead of a little phone call decision.

Here is Tracy selling only the call back:

Sales Person:
“Hi Mr. Prospect, it’s Tracy Drew with ABC Technologies. Lisa Jones from XYZ suggested that I call you. Please could you give me a call at your convenience, it will only take me two minutes. Please call 0800 849 6732 whenever you get a quick minute and I think you will be impressed. Once again, that’s Tracy Drew with ABC at 0800 849 6732, and I look forward to your call. Thank you…”

In this example the sales person sold only the return call.

She did not even mention the stuff she was selling nor did she explain that the mutual acquaintance made a purchase; which does nothing more than put pressure on the prospect to also buy. No. This sales person sold only one thing: the quick phone call. Also, note the sales person stressed that the call would be quick and painless; she made it EASY for the prospect to facilitate the return call.

The same holds true for an email. Don’t go on and on in an email trying to reassure the prospect—just keep the one objective in mind.

With a phone call, an email or any other form of communication in the selling process, you must understand the objective at each stage and concentrate on that ONLY.

Take it one step at a time and you will get more returned calls and emails and close more sales!

Happy Selling!

Sean