Research suggests only one in 50 deals are struck at a first meeting, yet many sales people give up after just one or two knock-backs. Perseverance will give you a major edge on competitors, says founder of Marketing Wizdom, Robert Clay
You can sometimes be so close to your business that you can miss the simple solutions for growing it, where the greatest opportunities often lie. Solutions that are blindingly obvious, once you're aware of them - but are amongst the best kept secrets on the planet if you're not. For example:
Only 2% of sales occur at a first meeting
People in business often hope and expect to do business the first time they meet a prospect. Yet studies reveal that only 2% of sales occur when two parties meet for the first time.
The 2% who buy at a first meeting tend to be people who have already looked into the subject matter, and already know what they're looking for. If they meet someone who ticks all the right boxes and they get on well, then business may well be transacted. But that is far from the norm. The other 98% will only buy once a certain level of trust has been built up.
Anyone who believes they can go into a sales situation armed with '101 sure fire sales closes' and make sales is seriously misinformed - and about 20 years behind the times. Professional sales people get to know their prospects; understand their issues; solve their prospect's problems; and provide irrefutable proof. They build relationships and trust by engaging in ongoing dialogue (otherwise known as follow-up). They don't just peddle their products and services with an armoury of closing tricks.
There are many reasons why people who could benefit from your product, service or expertise do not buy. At least not without further prodding. Inertia. Lack of time. Too many other things on their mind. Concern about cost. cash flow. Budget constraints. More pressing matters. Your failure to do enough marketing to establish your name in your field so they'll buy without question - and more. None of the these, by the way, is a negative. They are just psychological and transactional realities you must become aware of and recognise - which is why follow-ups are SO important.
Yet isn't it amazing how often you express interest in a product or service, but never hear from the person or company again? It happens all the time. Research shows, amazingly, that only 20% of sales leads are ever followed up. In other words, 80% of potential opportunities are lost without trace simply due to lack of follow-up.
People and companies who don't follow-up, who do nothing to build up that trust and relationship, cannot succeed, especially in today's tough economic climate. People need to be sure they're making the right decision before they commit to a purchase.
Tenacity results in sales
Different studies carried out at different times, in different places, by different market research companies over a number of years all reveal that 80% of non-routine sales occur only after at least five follow-ups.
Think about that. It takes at least five continuous follow up efforts after the initial sales contact, before a customer says yes. FIVE!
There are some fascinating statistics on this:
- 44% of sales people give up after one "no"
- 22% give up after two "nos"
- 14% give up after three "nos"
- 12% give up after four "nos"
That tells you that 92% of sales people give up after four "no's", and only 8% cent of sales people ask for the order a fifth time.
When you consider that 80% of prospects say "no" four times before they say "yes", the inference is that 8% of sales people are getting 80% of the sales.
Introduce a five "nos" follow-up strategy
Once you're aware of these statistics you should stack the odds in your favour by introducing a 'Five nos' strategy, where you maintain contact with prospects until each one of them has said "no", or "not now", or "not yet" at least five times. Every time you're in contact you have an opportunity to advance and build the relationship.
Businesses with a "five nos" strategy will always enjoy a conversion rate many times higher than their competitors who have no such strategy. What strategies do you have in your business right now to ensure that you contact your prospects regularly in a gentle and meaningful way so that you win their business and their loyalty?
'Top of mind' awareness
There's also the fact that 63% of people requesting information on your company today will not purchase for at least three months - and 20% will take more than 12 months to buy.
Contacting your prospective and existing customers every three months or sooner builds trust and professionalism and keeps 'top of mind' awareness. In this context, your customers do not regard contact for orders, payments and appointments, or the obligatory Christmas card as a meaningful communication.
What meaningful communication strategies do you have in place right now to maintain top of mind awareness once someone has been in contact with you? How do you nurture your clients so that they learn to trust you and see you as a professional organisation?
This simple strategy could be critical to your survival in the current economic downturn. Implement it and prosper. Ignore it at your peril.
Robert is an entrepreneur, author, speaker, seminar and workshop presenter and designer of world-class low-risk/high-return marketing strategies for entrepreneurs and aspiring market leaders. Robert started his first business at 19 with no capital.