Same Side Selling

by Ian Altman

  This dynamic reflects the potency of restraint. Restraint is both a cause and an effect of Same Side Selling. Practicing restraint doesn’t just show that you are not playing a game; it also gets you out of the game.

  Sentences That Magically Change Games into Puzzles

  Same Side Selling is not a quick fix; it’s a mindset, a methodology, and a group of disciplines that require practice to perfect. But if we had to create an instant Same Side treatment, it would be prescribed in the form of restraint. In fact, a few words expressing restraint can serve as a magic spell that instantly brings a conversation out of the adversarial mentality and puts the buyer and seller on the same side. For instance:

  “We may not be the best firm to help you with this problem.”

  “As much as we’d like to work with you, we are not yet sure if we have a great fit.”

  These admissions echo the Disarm phrases that we covered in Chapter 3, Narrow Your Market, and they have a similar appeal later in the sales process. Buyers do not expect to hear these words from sellers. They find them refreshing and attractive.

  Buyer’s Perspective: I’ve almost never heard a salesperson tell me he couldn’t help us. I can think of two specific instances, one of which happened over five years ago. The first thing that struck me was, “For these guys, it’s not all about making the sale.” The second thing I thought was, “Wow, I’d love to work with them on something.”

  Because even the best products, process, and sales talent will miss sometimes, it is important to have a plan for that certain contingency. How do you proceed when you and the buyer have concluded that your pieces don’t fit together?

  Referring from the Same Side

  After the buyer and seller decide together not to force the fit, no one would blame the seller for simply wishing the buyer the best and saying goodbye. They can part as friends and move on in the world. But just because you don’t have the pieces the buyer needs, does that mean you can’t help solve the puzzle?

  Referring another solution or vendor to a potential prospect is a black-belt-level skill in Same Side Selling. It proves beyond any doubt that restraint is not manipulative or some highly disguised form of self-interest. To say “We can’t help you with this, but I think I can help you find someone who might be a great fit” erases any lingering adversarial suspicions.

  The benefits of referring another solution are well studied and well known, so why do so many sales conversations end with a parting of ways and no referral? Here are a few reasons that salespeople are reluctant to refer another solution:

  • They still hope they might get the business, and they don’t really want the buyer to hire someone else. (We’ve worked through these passive-aggressive sentiments already in the chapter. Let’s move on.)

  • They don’t know whom to refer.

  • They are afraid that the referred company might not do a good job.

  • They fear that the referred company will help not only in this situation, but also in others in which their company is engaged.

  We will present several guidelines that will address these concerns and will apply to any referrals to make it more probable that the buyer stays on the same side.

  Referral Tip 1: Refer With Full Candor

  Referring is an area where full candor is required for self-preservation. When you introduce another potential problem-solver, a misunderstanding or partial truth could hurt your reputation. So be proactive and thorough in how you present the referred company.

  Share any and all connections. If the company you are referring is a family member or a friend, be sure you say that up front. If you are in a networking group together or you attend the same synagogue or the VP lives in your neighborhood, let the prospect know. By all means, if you have any business affiliation or could benefit from the referral, let the prospect know. Ian often gets asked if he can help with recruiting. Since he does not offer that service, he often refers to a small set of other firms and always says, “I receive absolutely no direct or indirect compensation from them. However, when they find you the right person, it helps us achieve greater success together.”

  Share your knowledge of the referred company’s results. Because you are helping the prospect find a fit, the key word is “results.” If you have worked with the referred company multiple times in the past fifteen years and you’ve seen many of their clients achieve success, then share it! Even if you’re not familiar with the referred company’s results, the referral can still be helpful—just let the prospect know. The same principle applies if you just found an interesting-looking company on the Internet ten minutes ago.

  That brings us to the next principle of referrals.

  Referral Tip 2: Research Referrals

  Just because you are new in town or have recently changed fields doesn’t mean you cannot make helpful referrals. As long as you are candid about your connection, it’s fine to refer companies that you don’t have firsthand experience with. A good way to do this would be to say:

  “We may not be the best fit right now, but I’d certainly like to help you find a company that can help you. Let me give that some thought and do some research and get back to you with a few suggestions by the end of the week. Would that be helpful?”

  You may be wondering why your Google and Bing efforts would be better than the buyer’s. This is an area where an hour of research could be extremely helpful for your former prospect. For one thing, you have different areas of expertise. You know what you’re looking for and probably the best terms to search on. You can probably make a call or two to qualify your recommendations. The output doesn’t have to be a conclusive marketplace review; simply provide the names of the companies, the websites, and a few reasons that you think they merit further research.

  The goal is not to provide an ironclad endorsement, but to help buyers move forward with their search for the right fit. That brings us to the next crucial referral tip.

  Referral Tip 3: Refer Multiple Solutions

  Referring two companies is much, much better than referring one. (If you know only one, follow the second tip to research and find more possibilities.) Providing multiple referrals for a specific problem helps in several ways. Most important, it relieves you of any perceived ownership of the outcome. You are not promoting the right solution, but simply providing some possible choices. You are encouraging the buyer to continue her search for the right fit.

  If you are referring only one vendor, you can simply say to the prospect, “My clients have had great success with them. I’m sure there are other qualified vendors. I’d encourage you to compare two or three vendors before moving forward.”

  In addition to protecting you as the referrer, submitting multiple solutions has another upside. If you provide introductions or connections to possible vendors, they will appreciate the opportunity even if it doesn’t work out for them. Better still, more shots on goal means a greater likelihood that the vendor the buyer chooses will be one that you suggested, so you will still have a role in solving that puzzle.

  A Warning: No Favors, No Hookups

  In addition to the three “do’s” in the principles above, we want to explicitly define an important “don’t.” Do not refer a buyer to a seller as a favor to the seller.

  The driving motivation should always be fit. Ideally, you would refer the buyer to other sellers who would practice Same Side Selling and put the FIT first, but their methods are beyond your control. You should certainly do your best to not refer someone who will themselves force the fit or who is desperate for business or unclear about their value proposition.

  In this case, the analogy of romance and dating is helpful. If you had a friend who was a bit desperate, would you set him or her up with a person you valued, as a favor to your friend? Or would you introduce the two of them, believing that there may be a fit, and leave them to sort it out? This is a meaningful distinction.

  By the same token, the referral should not be seen as a “hookup” that
absolves the buyer of the need to confirm the fit and the value on his own. If you have a great relationship with a qualified vendor, you might be tempted to put a referral on the fast track by promoting that vendor:

  • “These guys would be perfect for you.”

  • “I’ve known Jim for years and he will definitely do a great job.”

  These strong endorsements may seem harmless or even helpful, but they should always be qualified with a dose of restraint:

  • “From what I’ve seen, these guys might be a great fit for this job.”

  • “I’ve known Jim for years and he has many satisfied clients; if you guys determine that he’s the right fit, I’m sure he will deliver.”

  The difference again may seem subtle, but it is meaningful. Backing off a little removes any hint of sliminess or the sense of an inside deal. It keeps you on the same side as the buyer.

  Can You Refer to a Competitor?

  This question relates to Chapter 2, Be Unique. If you have clearly identified your unique value proposition, you should be able to differentiate your company from your perceived competitors. This principle works both ways: it means that you know which types of buyers are better for you, and you know which types are best for your competitors. In fact, the companies are competitors in only a limited sense because your puzzle pieces are unique, and your best prospects will be different from those of your competitors.

  In fact, referring a one-time prospect to a perceived competitor is a grand trophy of Same Side Selling. If you have made it there, congratulations.

  For more on referrals, we refer you (get it?) to our good friend and referral expert Derek Coburn. In his book, Networking Is Not Working, he presents a business development plan based on referring business to others.

  Put Same Side Selling to Work

  Pushy salesmanship leads directly to the adversarial trap. One of the most effective ways to get on the same side as the buyer (and separate yourself from other salespeople) is to avoid any hint of forcing a solution that may not meet the buyer’s requirements. This means being quick to acknowledge that you may not have the right offering, and it may mean even referring the customer to another solution or vendor. Practicing restraint and referral builds your stature with the buyer, and positions you to sell easily and quickly when you do have the right solution.

  Talk to your sales team about whether your company consistently practices restraint or sometimes forces the fit. Identify specific clients with whom you have forced the fit.

  Make a list of the competitors you frequently see in the marketplace. Then add some information about which types of clients are the best for each of these firms. Your team can use this information to help confirm that you are the best fit, and as a referral guide for prospects for whom you don’t have that ideal fit. (We’re not suggesting that you share the list with buyers, but you can use it internally to point them in the right direction.)

  Count the number of referrals you have made in the last year. If you do not have this information, consider tracking referrals along with your other sales metrics.

  Identify a sales opportunity that you lost in the last ninety days. If you’re not sure of the outcome, write an email that starts, “In case you have not found a great solution yet, I had a few thoughts about whom you might talk to” and then list the companies and your notes about each one.

  Conduct a sales meeting in which referrals are the sole agenda item. Share your recent experiences in referring to others and share ideas about how to refer more effectively. (Have your team read this chapter before the meeting.)

  CHAPTER 8

  Sell Value, Not Price

  News flash: Buyers often focus on price. In many cases, your initial conversation with them might be primarily about price. We know that can be frustrating for sellers, but remember: when we’re the ones buying something, we care about price, too. So here’s our first suggestion for handling a buyer’s focus on price: get over it!

  Now that that’s out of the way, we can give you more practical advice, which is summed up in the chapter title: sell value, not price. Unless you can present price in the context of your overall value, you’ll get stuck in an adversarial trap where the buyer sees your products and services as commodities. Luckily, you’re not stuck there. By the end of this chapter, you will know how to sufficiently convey value and price as part of the big picture, not in isolation.

  We knew this book would be incomplete without addressing the issue of price and value as perceived by the buyer. Our informal research confirmed this: when we invited sales leaders to share any challenges they faced with buyers, the response we received more than any other was pricing pressure.

  What might surprise you, though, is the primary source of this pressure. In the book Inside the Buyer’s Brain (Hinge, 2013), Hinge Marketing’s research shows that more than 50 percent of sellers say that pricing is a key driver in the buyer’s decision. However, only 28 percent of buyers say price is a key driver in the decision process. Given these findings, then, we might conclude that price matters most when the seller believes that price matters most.

  When your clients or prospects do start to give you a hard time about price, it is often a sign that you did a less-than-stellar job of helping them see your value. You might see pricing pressure for the initial sale, or you might see it when clients are ready to reorder. We’ll cover both situations in this chapter.

  See the Big Picture

  Ian had an opportunity to speak with Bob, the founder and CEO of a regional architecture and design firm. Bob’s firm specializes in designing the interior of commercial office buildings. Bob was complaining that his clients just care about price. Ian asked Bob, “How much does your typical project generate in fees?” Bob explained that his company would like to earn about $4.50 per square foot for a typical project, but they can’t charge more than $3.50 per square foot. Their typical project is a scope of 20,000 square feet. So, his clients and their representatives have trouble paying Bob’s firm $90,000 versus the $70,000 they believe they should be paying.

  In this situation, the buyer is shocked by the $20,000 difference and wonders if the seller is nuts:

  Buyer’s Perspective: Wow! Bob is $20,000 more than my alternatives. He must be insane. Doesn’t he want our business? Salespeople seem to be offended when we need to go with the lowest cost. I understand that everyone likes to be a premium product, but don’t they have cost constraints when they buy at their companies? I have a board to answer to, and they are ALWAYS concerned about cost.

  The seller is thinking, “Are you kidding me? You are embarking on a multimillion-dollar investment, and you are giving us grief over $20,000? Why are they squeezing us? Don’t they realize that we’ll deliver a much better result for their project?”

  Discount vs. Bob in Isolation

  What’s going on here, and how can this gap be bridged?

  The problem is that Bob generally presents his fee independently of the overall project costs and the long-term cost of the broader solution. Clients are about to make a multimillion-dollar investment, but that aspect hasn’t been mentioned.

  Share the Big Picture

  In order to work on the same side, the buyer and seller need to view the purchasing decision through a common lens—something that’s clearly not happening yet. To get there, both buyer and seller need to think about this project in terms of the big picture.

  Bob said that his company’s typical project is about 20,000 square feet. Here is the information Bob shared about his business.

  How long is the typical lease for a 20,000-square-foot building?

  10 years

  What is the average cost of the lease per square foot in this market?

  $40

  On average, how much does construction cost per square foot?

  $50 to $85

  Doing simple math, we see that the end-customer’s lease cost would be $800,000 per year. The 10-year lease would be worth $8 million—plus annual incre
ases. Construction (using the low end of the range at $50) would be $1 million. So the total transaction at this point would be $9 million. Brokerage fees and annual increases would easily bring the total cost to more than $10 million.

  If Bob priced his work at $4.50 per square foot, the fee would be $90,000—less than 1 percent of the overall transaction value. The difference is so small that it’s barely visible in the following chart.

  Discount vs. Bob in Context

  Changing the context of the architecture fee changes our perspective, doesn’t it? Let’s get back to Bob and see how this change works.

  Ian asked Bob, “What is the single greatest factor in whether or not the space is successful for the client?” Bob said, “The architecture and design.” Ian asked, “Do you really think that the client would make a decision that could put the project at risk to save $20,000 on a $10 million project?” Bob said, “If the client saw it in the big picture of the larger project, then of course they would pay a bit more.”

  Here is the key: It is not the client’s job to see the big picture. It is Bob’s job to ensure that the client sees Bob’s price in the context of the overall project and its value.

  Compared to $70,000, Bob’s fee of $90,000 sounds high. Compared to $10,000,000, the difference appears insignificant.

  In this example, Bob can illustrate the cost of his services in relation to the overall scope of the project. Doing so allows the buyer to see that the relative difference in fees is almost irrelevant. Just about anyone would be willing to spend an additional $20,000, on top of $10 million, if they felt they would get a better result from that investment.

  Framing Total Cost and Total Value

  The old-school salesperson had a goal of selling at all costs. Same Side Selling is ensuring that your clients or prospects see that you are looking out for their best interests. The total cost of ownership is their “real” cost. The initial purchase price might cover your transaction, but not their eventual investment. It is your job to illustrate all of the costs of their project—even the ones that you don’t control. The self-interested salesperson might be afraid to open the client’s eyes to other costs, but the Same Side Selling professional recognizes that transparency is the key to value and to long-term business relationships.