Selling in China.  They sell value. Part 2 of 2.

I just returned from a 14 day trip to Southeastern China and Hong Kong . These  bus trips are part of the Chinese stimulus program where the govt subsidizes the travel of expatriates in order to get them to visit many government owned industries to buy Chinese products as well as stay in tourist hotels and eat in large tour oriented  restaurants.  This directly employs people in the tourist and manufacturing industries and is quite a  smart idea, as people do spend money.   I reviewed several instances of Chinese salespeople interacting with expatriate Chinese ( with apologies, my Mandarin is poor) .  Some of my sales beliefs were reinforced  as I observed how the Chinese sales person sells on value. It is all to easy for Westerners to think that the Asian sales technique is about the price.  Price has a place but it is not the first thing that is raised.

Successful sales people in China ( and this is for bigger ticket items, not the universal barker stall tactics) spend upfront time on building relationships with a subtle twist to the  Western approach. I saw the process had three parts:

1. Introduction of salesperson, the story  why this salesperson can be trusted and the building of common ground.
2. Why the product and company can be trusted, the value of the product
3. The special deal that is extended ( to head off negotiation)

Part 2. Why the product and company can be trusted.

Awards and certifications are very important here. It is not uncommon to see a salesroom wall festooned with plaques and framed documents speaking  to ISO certifications,  local and international industry awards as well as pictures of  famous dignitaries who visited the plant ( ex-President Nixon really got around!) .  In one clothing facility we saw pictures of supermodels and celebrities wearing the fabrics.  The requisite logos of partner companies are also displayed for all to see.

In the sales process, this documentation is mentioned , but the salesperson goes into detail on the science and research behind the products, the increased durability and ecological advantages.  Personal anecdotes are used extensively such as how one guides 88 yr old grandmother has very good health due to  drinking a specific tea all her life, and we are going to that tea plantation.  In the sales shop it was not out of line for individuals to then spend several hundred dollars on large boxes of tea to take home.   Expect to sit through a comprehensive corporate video showing the depth and breadth of the company resources.  History pays a large part in these presentations, with some firms proudly  tracing their roots hundreds of years.  Often, there are often very old, almost priceless art works proudly displayed in company foyers.  (Dragons are seen as very good for business as they draw money in.)

We sat through several founder stories where under great hardship, the firm survived many challenges with great strides being made in recent years.  Westerners who want to do business here, need to have respect for the old and the promise of the new.  Also expect to see charts , diagrams, scale models, or  operating micro process plants displayed.  This spoke to me of  a visual culture – one that wants to see how things work.

We saw tremendous brand awareness toward famous Western brands. If you have strong famous partners, the Chinese want to know this and would wonder why you do not display it proudly.

Part 3 . The special deal

We encountered several  posted no negotiation situations.  But, there was always a special offer.  Examples:

• Buy one get a second of lower value for free.
• The higher the spend, more special gifts were added to the bundle.
• Retail loyalty cards were everywhere – as you bought more your discount became higher through tiered loyalty cards. Basic economic value model in a standardized model.

We saw various negotiation approaches tried effectively to reduce price. E.g. :

• The special friend price (warm introduction)
• The Middle Eastern walkaway
• Low ball countered by multiply the bundle

Yet, the better the job done by the salesperson in building trust and common ground, the shorter the negotiation stage. A few times a buyer would ask ” give me your best price, if I like it you have a deal, if I don’t I will go somewhere else”. This worked sometimes.

I wondered what the final sales price would have been if the value building steps had not been effectively carried out.  Strong effective sales people know about preserving price points and margins through building value first remain true in selling in China. Westerners need to understand all the facets of what the Chinese client sees as value.  Knowledge of and respect  for the sales person as an individual, respect for the company and products and brand value need to be communicated.  These are all elements of successful sales persons everywhere, it is just having the sensitivity of knowing how much is needed at each step.

As a postscript we learned that China does not yet  have  a service culture. To serve is to be of lower value than those being served. In all dealings, one should not  place unexpected Western service demands on an individual as it involves a loss of face. Better to look at the whole deal laid out in the beginning with service levels specified. Extra care and detail here will benefit both parties.  And be prepared at a restaurant to not have your coffee or tea cup automatically filled, nor will the waitperson smile much!

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Selling in China.  They sell value. Part 1 of 2.

I just returned from a 14 day trip to Southeastern China and Hong Kong ( When you go, Oct  is best) .  I reviewed several instances of Chinese salespeople interacting with expatriate Chinese.  Some of my sales beliefs were reinforced  as I observed how the Chinese sales person sells on value.

It is all to easy for Westerners to think that the Asian sales technique is about the price.  Price has a place but it is not the first thing that is raised. In China I saw similarities to sales techniques I needed with Japanese firms.

Successful sales people in China ( and this is for bigger ticket items, not the universal barker stall tactics) spend upfront time on building relationships with a subtle twist to the  Western approach. I saw the process had three parts:

1. Introduction of salesperson, the story  why this salesperson can be trusted and the building of common ground.
2. Why the product and company can be trusted, the value of the product
3. The special deal that is extended ( to head off negotiation)

Part 1. Introduction, personal trust building and building common ground

This is where the Chinese way differs most from Western style. This preamble can take much more time then Westerners are used to.   I saw this manifest in several forms. The expected form is that the “salesperson” introduced themselves immediately on meeting the client – such as I am such and such from this province. You may call me Ben ( e.g) .  My family does this and this and I went to school here and here and did such and such with my time up to now.  When this step is delayed, the client feels agitated.

One trust building approach in particular was very effective. A young lady introduced  herself as having been selected for Chinese opera school. She had to interrupt her studies  when her parents became ill. She nursed them and in return, her father gifted her with two houses and lots of money (The Chinese have a very healthy attitude to money and business).  This story went over very well as filial loyalty ranks so high in this culture. (common beliefs)  Further, to be in opera school is a big deal (speaking to high personal capability and sacrifice)   and to give it up was a mark  of great respect to parents.  After dinner this person sang a song that was very well received.  (Singing songs is also a big deal in building friendship/respect. As a further note her training gave her tremendous powers of content retention and a voice that was very persuasive.

A second technique  was shown by a young man who said he was the fourth son of the owner of a business. He was the sales trainer .  He started asking the prospects where they had been in China and what they had seen so far. He suggested that the true China was found by visiting the rural districts and not the big cities. He went on to list some of the big problems facing China ( large scale corruption and the gross nepotism of the ruling elite wrto who gets the big money jobs and opportunities). His frankness opened up a serious discussion between himself and the prospects were  he was recognized as a straight shooter who could give a frank opinions on business in China. After about 25 minutes, this lead to very high value business discussions between the parties as the clients sought ways to do business with this individual.

If a craftsman is involved in the process, client buying resistance seems to be superseded by the demonstration of capability, hours dedication to perfection  and the humbleness of the craftsman. The chance to interact with a craftsman brings the client closer to the source of the product  increasing trust and adds a desire to reward vs negotiate for the product.

On the other side of the table, if the client ever demonstrates that they are not that interested in what the salesperson has to say – the salesperson loses face. This is sign of great disrespect and could easily befall the Western buyer who wants to “cut to the chase”.  (If you are not interested in what I have to say, then I feel less inclined to deal with you.)

The personal trust building step took more time than one would usually see in Western cultures and may give us a clue where Western firms that try to move too quickly to the business discussion get themselves off on the wrong foot. We know that if you skip all the “value building’ steps, then the only discussion is about price.

Also we know that the sale is first made by emotion and logic is used to justify it.  Westerners can not ignore how the Eastern business person views the emotional side of doing  business with them.

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Insightful Selling. Learn the s.a.l.e.s. formula to differentiate yourself and create customer value. Adon T. Rigg. 2011. ISBN 9781466428607. On first look, this is an ideal  Sales 101 book, for the new and aspiring salesperson who wants to be up to date.  Clearly written, it covers all the bases wrto sales.  The uniqueness of this book is the clarity with which the author covers the language of business and how to find and deliver business value. He includes a valuable chapter on how to  read financials in order to match what you are selling to the needs of the target client. He is all about targeting and being a smart sales person. He quotes from Selling to the C Suite ( Read & Bistrite) where 82% of CEOs said they would take a sales meeting if it was recommended by someone internally.  This is a good addition to today’s sales library.

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Reid Hoffman (Photo credit: Wikipedia)

the start-up of YOU. Adapt to the future, invest in yourself, and  transform your career
Reid Hoffman & Ben Casnocha. 2012. ISBN 9780307888907.   Hoff man  as a founder of LinkedIn has much to say about personal career growth.  Notr surprisingly the book contains numerous useful examples of how to use Linkedin to grow your career.  The authors place more follow-up information on http://www.thestartupofyou.com/start/  .    Clearly written, the book provides very useful career advice,regardless of what stage in your life you are.   It is not a self help book, since Hoffman stresses your growth depends on your network.  You will get a lot out of this little book.

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RFPs Suck! How to master the RFP system once and for all to win big business. Tom Searcy.2009. ISBN 9780982473962.  One thing we are noticing with increasing conservatism among buyers is the growth in the use of RFPs.  Where previously if a company had not been able to help write an RFP , they could decide not to participate, now an RFP is a given in many more markets large and surprisingly small making ignoring RFPs less of an option.   Searcy (The Whale Hunter – good sales book) , has created a short but very important guidebook around RFPs.  He starts with how to qualify the RFPs to make sure it is worthwhile for you to pursue it.  Then he leads you through every part of the RFP – where to slavishly follow the guidelines and where you can successfully stray. The last section looks at several failed RFP responses and where they fell down, to help you recognize how theory translates into practice.   A very good addition to a marketplace that has relied so far on Tom Sant for good material.   This is a must buy for every B2B sales person and sales leader.

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smart thinking. Three essential keys to solve problems, innovate,  and get things done. Art Markman.  2012. ISBN 9780399537226.

Science that’s state of the art that you can use.  A very useful book for leaders, sales managers, sales pros,  trainers, educators and parents.   The writing is crisp, clear and cogent.   He shows you how to acquire smart habits, acquire high quality knowledge and then apply it.  A few quotes , where he uses his idea of 3’s effectively.

Effective learning requires that you process deeply, explain things to yourself and be active in your pursuit of knowledge

In reviewing research, describe the processes used, the important pattern of data and the theory/theories supported.

In problem solving, find one or more ways to classify the essence of the problem, eg list sof proverbs, story titles or jokes.

A good implementation  intention, describes the actions needed to carry out a plan, it describes when and where these actions will be carried out and it grapples realistically with the obstacles that may arise in carrying out the plan.

This is a great book that will gently stretch your mental capabilities . Good for a cross country flight. I read it in two sittings.

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Start-up CEO’s Marketing Manual. Guy Smith,. 2012. ISBN 9780983240730.  Guy has an excellent blog http://www.siliconstrat.com/blog/,  from which Rocket Builders has pulled many gems over the years.  Our good friend, David Greer, alerted us that Guy had published this book.  This is the real thing folks. There is not a wasted word or diagram in it.  The book’s realistic market is just about any CEO we have every worked with.   Guy clears away the confusion and lets the CEO in on what he/she really needs to know about marketing , and how to see if his dept is getting him where he needs to be.  A short book, clearly written, you can read it on a 2 hr plane ride – but you should re read it on the way back and each year as well.  This is an essential part of a CEOs’ toolkit.

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Conversations That Win Complex Sales.  Erik Peterson & Tim Riesterer. 2011. ISBN 978007175090. We know that competition is fierce and your  prospects are being overwhelmed by information. Every now and again a book comes along that synthesizes and summarizes what you just know is happening in selling situations and then proves clear insight into what you can do. This is one of those books.  Their Point of View is based on what is going on in the mind of the receiver while your are in the middle of a pitch, and how we usually  faili miserably in helping clients move forward.  Based on lots of research and experience the authors will show you how to make much better use of your selling time, become a much more valuable resource to your clients and move those stalled deals forward.   Did you know :

• Your Old Brain views the simple approach and stories as coming from much more intelligent people – park the jargon
• In the Hero story, your job is to make the client the Hero
• The first and last ten minutes of a presentation are gold – do not waste it by telling the client about your self.
• Tie approaches  to the techiques taught in the  The Challenger Sale, You need to challenge the prospects status quo – to prevent the do nothing response.
• You are presenting stories and conversations not a pitch  (again the buy is emotional first than logical)

Terrific book. Needs to be in the kit of high performance salespeople. Perfect for a 4 hour plane ride.

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revenue disruption. Game changing sales and marketing strategies to accelerate growth. Phil Fernandez.2012. ISBN 9781118299296. At last!!!! Someone has written a book on how to align sales and marketing toward revenue.  The author of this easy to read book is CEO of Marketo – which offers software to compliment this alignment.  Despite his vested interest this is a very good book.  He is right,  each sales resource is very expensive and it should be talking to highly qualified leads. Our firm has been working on this topic for ten years and we have the scars and data to show that it works. Why do it?  Here are some scary stats of waste that needs to be taken out  (this leaves over $1 Trillion a year on the table) :

• 94 % of all marketing qualified leads will never close
• Sales reps spend 68% of their time not talking to customers
• The ave. sales team will make 1000 telephone calls to close one sale
• 52% of sales reps in US do not achieve quota.

Once you look at Revenue generation (integrating sales and marketing)  you come up with the different marketing sales metrics to track

1. Flow – How many people entered each pipeline stage in a given period.  Trend up or down?
2. Balance – How many people in ea pipeline stage? How many accounts? Do they vary by lead type? are nos going up or down?
3. Conversion. What is the conversion rate from stage to stage? Which types of leads have the best conversion rate?
4. Velocity. What is the average “revenue cycle” time? How does it break down by stage?

This ties exactly with what our company believes in and practices with clients.  Most companies just waste their sales and marketing dollars.  And it is so fixable….

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