Effective Use of Competitive Intelligence

by Lan Bui, April 25, 2008

It is one thing to obtain competitive intelligence, but it is another to use it effectively. Many companies know they need more information on their marketplace, but rarely know what to do with it.

I speak to many prospects and customers on a daily basis. Recently, I spoke to a customer about how they are currently using the Win Loss Analysis data that is provided to them. They shared with me that they are using the individual opportunity profiles as a sales training and development tool. Once or twice per month, the customer holds round-table discussions with their sales team and discusses the individual profiles with them. During that meeting they discuss the learning points from those individual profiles. They discuss what they did well and what they can improve on for future opportunities. They answer questions such as:

• What could we have done differently to win that business?
• If its a win, what did we do correctly to win this deal so we can replicate it and continue to win more business?

This is a smart use of the information, but there is a relative concern many companies have stated: what if the sales professionals are sensitive in discussing these profiles, especially if its a loss?

Consider sanitizing the individual profiles. This particular customer has two different profiles delivered to them. A regular profile that goes to management with all the details about the individual opportunity and a sanitized one, with the individual customer name removed so that it cannot be identified with any particular sales rep. This way, the sales professionals dont feel targeted, and they can openly discuss these opportunities without feeling uneasy about it.

Having these round table discussions has been very effective for this customer, and it has been a great way to leverage the Win Loss Analysis data provided to them. This creates better communication within the group and allows them to share knowledge amongst each other. Sales professionals are the ones on the front line selling, so using valuable tools such as Win Loss Analysis and creating effective training initiatives around it helps them embrace this valuable data and should help improve their win rate.

What are the facts?

by Ron Sathoff, April 22, 2008

“What are the facts? Again and again and again-what are the facts? Shun wishful thinking, ignore divine revelation, forget what ‘the stars foretell,’ avoid opinion, care not what the neighbors think, never mind the unguessable ‘verdict of history’what are the facts, and to how many decimal places? You pilot always into an unknown future; facts are your single clue. Get the facts!” Robert Heinlein, “The Notebooks of Lazarus Long”

Being in the field of sales/competitive intelligence, I get to peruse a lot of sales effectiveness literature, and I have noticed that there is a particular strain of it that is based on intangible qualities that some methodology will help uncover. For instance, I’ve seen promotions for seminars or tools that are aimed at refining the “instincts” or “gut feelings” that a sales person must rely upon when facing a competitive situation. I even found one sales training Web site that claims, “In today’s commercial world, there are a myriad of different sales methodologies, processes, tools, sales systems, smoke and mirrors demonstrations, dramatic breathtaking slides which are used to position our product, company and services. However, what it all comes down to in the end, is the ability of the individual to sell themselves to their customers, and that’s all about instincts.” (http://salesinstincts.com/)

Sorry, but I’m going to have to disagree with them on that one.

While instincts and natural ability do play a role in sales success, it is even more important to go in with the proper knowledge and information in other words, get the facts. If you look at any of the million or so articles on common selling mistakes, you probably won’t find too many that mention “not having the right instincts,” but you will find, “not going in prepared,” “not asking the right questions,” “not understanding your products,” and “not having done your research.” The sales person who is informed, knowledgeable, and prepared for the situation is going to have a much stronger hand in any competitive situation. In order to gain this competitive edge, you have to do your homework and get the facts: the facts about your company and products, the facts about your competition, and the facts about your prospect.

Knowing your products and your company
Before you can sell a product to a prospect, you essentially have to sell it to yourself. That means having a clear and unbiased understanding of:

• What are the strengths and weaknesses of your products and company?
• What features and options are available?
• What features and options are forthcoming?
• What kind of customization is available and/or do-able? (In other words, knowing what you can and can’t accomplish so you’re not over-promising.)
• What are the current project timelines for your company? (This helps provide customers with accurate forecasts and schedules)

Of the three types of facts, this can be the easiest to gather. Read your product information (data sheets, white papers, product spec sheets, etc.) voraciously. Work with your products so that you get a feel for what your customers are going to be experiencing. And maintain good lines of communication with your implementation and operations teams so that you are all on the same page. Ideally, you should think of yourself not just as the person selling the product, but also as a key member of the technical team.

Knowing your competition
Understanding your own company’s advantages and limitations is only a beginning; to be able to differentiate yourself from your competition, you also need to have a keen awareness of their strengths and weaknesses.

• Which competitors are you the most likely to encounter in particular situations?
• In what types of sales situations has your competition excelled against you?
• What are your competitors’ advantages and disadvantages compared to your company and products?
• How are your competitors seen in the market?
• What were the concerns of past customers of the competition?

For many of these questions, you can get the answers in the same way that you learn about your own company: read their literature, try out their demos (if available), and read up on the company. Are there any forums that review their performance? How are they portrayed in the media? With a little time and an Internet connection, it is often surprising how much you find out about a competitor, especially larger ones.

In some cases, however, you may need to go to more primary sources. If you have a good relationship with a current customer, they may be willing to discuss their experiences with your competitors. Or, you can utilize your competitive intelligence personnel or a third party to research how you stack up against your main competitors.

Knowing your prospect
The first, and often most important, step to meeting your customer’s needs is knowing what they are. And, to understand a prospect’s situation, you need to do research into their background and specific situation. For instance:

• What are the dynamics of their industry? (Industry concerns, market trends, etc.)
• What is the culture and philosophy of the organization?
• What is the organizational structure of the company?
• Who are the key stakeholders?
• What are their specific requirements for the purchase?
• What objectives are they trying to fulfill with this purchase?

To avoid “tap-dancing” in the initial encounters with the prospect, it is important to try to get at least the most basic of these questions answered prior to your first discussions. You can gather information from secondary sources (Internet, new articles, etc.) or you can utilize a prospecting methodology to gain insight into your potential customers. However, it is important to realize that your fact-finding mission is ongoing. Don’t be satisfied with what you have discovered in your initial prospecting; dig deeper by communicating with the prospect and asking relevant questions. If the prospect sees that you are trying to understand them in order to better serve them, you will be surprised by how forthcoming some will be.

Some people will say that doing rigorous research prior to and during a sales evaluation is a waste of time, and if they are trying to sell a double-cheeseburger and an order of biggie fries, they are probably right. However, for larger, more complex enterprise sales, the time spent getting relevant data will pay dividends in the form of more wins and more satisfied customers. So, ask yourself: in that next sales opportunity you’re going into, what are the facts?

Newsletter (04/15/2008)

by Mark Larson, April 17, 2008

In this week’s newsletter we look into how back-end systems support matters to a video game software giant and how to succeed in the uphill fight to win a contract away from an incumbent rival.

The A-List: Oracle Scores Big with Activision
When Activision looked to implement a new strategic marketing system, it chose to do so on a Linux platform with the entire back-end running Oracle products. Activision wanted to secure support for the setup and talked with Oracle and Red Hat for these services. After a three-month review, the Company chose Oracle…
(For more, click here)

BlogCentral: The Ins and Outs of Unseating Incumbents
Sales teams often encounter specific difficulties when competing against incumbents because clients do not want to incur transition risks or costs associated with changing providers. So, how does a new vendor go about overcoming these obstacles and provide reasons compelling enough to motivate a client to choose the new vendor?…
(For more, click here)

The Value of Responsiveness

by Glen Remy, April 15, 2008

Have you ever ignored an e-mail because you were just too busy? Maybe you gave it a quick read, and then promised yourself you would get back to it after you finished what you were working on. Then you just never get back to it. How about for a voice mail message? You saved it, with every intention of calling the person back, but just got too busy with other tasks and never returned their call.

Obviously this happens to almost everyone, but I am always amazed when I hear a customer express concerns of the non-responsive nature of their sales rep; especially when that customer is in the midst of evaluating your product or service. Surprisingly it is a fairly common occurrence for large and small companies alike. Customers may have questions or concerns during their evaluation process, and may reach out to their sales rep for the answer. If they dont get an answer fairly quickly their frustration level may increase with every passing day the e-mail or voice mail goes ignored. Thus the chances of winning that deal may actually decrease.

Sales reps are probably some of the busiest people in the world; with prospecting, presentations, contract negotiations, building relationships, and everything else they have going on. So understandably an e-mail or two may get missed on occasion. However, if you are non-responsive now during the sales process, how responsive will you be after the sale has been finalized?

If you are just too busy to address a question at the moment, try responding with something along the lines of, “Thank you for your question. I will review it and get back to you by (insert doable time frame).” Then make sure you either flag the e-mail, or do something to get it on your to-do list. Make sure to set realistic expectations as to the time frame needed to respond.

We are all busy and seem to have less and less time each day. However, we all appreciate it when a co-worker, boss, sales rep, or friend is responsive to our e-mails and voice mails. It makes us feel valued, respected, and validatedeven if the question may seem like a “no-brainer”. Making it a priority to respond to your clients as quickly as possible may put you ahead of the “other guy” who is just too busy to respond.

The Ins and Outs of Unseating Incumbents

by Nicole Graham, April 11, 2008

Sales teams often encounter specific difficulties when competing against incumbents because clients do not want to incur transition risks or costs associated with changing providers. As an example, an executive we recently interviewed for one of our clients stated,

“[Being] the incumbentgives anybody a huge advantage. You actually don’t have to come up with reasons why you are going to select them; you have to come up with some pretty compelling reasons why you’re not going to select them. The operational risk and transition costs associated with changing vendors were obstacles that needed to be overcome if anybody else was to get the business.”

So, how does a new vendor go about overcoming these obstacles and provide reasons compelling enough to motivate a client to choose the new vendor? Read on to learn about the three basic principles of unseating an incumbent:

1. Provide a strong advantage-to-risk value proposition to the client
2. Take advantage of the inherent overconfidence of the incumbent
3. Be proactive in fulfilling the needs that the incumbent may have overlooked

The competing provider must first give the client the impression that the advantages associated with choosing it would outweigh the risks of doing so. To create this advantage in the client’s mind, the sales team must discover the areas in which the incumbent’s past performance has been poor and play up its own strengths in comparison, creating a gap between the two vendors. It is essential that, in exploiting these weaknesses, the sales team reflect genuine concern for meeting the client’s needs and not appear petty or derogatory toward the incumbent, particularly because existing relationships or a high opinion of the incumbent could cause such behavior to detract from the team’s goal and cast the new vendor in a negative light. The client must feel that the sales team understands its needs and that trying to meet them is the team’s primary motivation. The team should make a rational case for how it will perform better than the incumbent without being petty or appearing to indulge vendettas.

At times, certain circumstances of the procurement process can make it difficult for a vendor to discover where the client has been less than satisfied with the incumbent. Sometimes, clients cannot divulge much information on other vendors due to internal regulations, the strict rules of public tenders, or the presence of third parties. If the sales team is unable to ascertain weaknesses in the incumbent’s past performance, it should consider that incumbents tend to fall prey to certain weaknesses in general: arrogance, unwillingness to listen, and the assumption that they have a complete knowledge of their clients’ needs and environment.

The incumbent knows as well as its competitor that the client is unlikely to change providers because of the associated risks and costs, but this knowledge often makes the incumbent arrogant, causing it to put forth less effort to win the sale. And while it may be true that the incumbent enters the procurement process with an in-depth knowledge of the client’s environment, this knowledge often causes the incumbent to assume it already understands the client’s needs in the particular case at hand, blinding it to what the client is actually asking for. In this sense, entering the procurement process without preconceived notions of what the client wants is an advantage for the new vendor, as it must listen more closely to the client. Vendors in this situation should listen well, internalize the client’s requirements, and tailor their solutions accordingly. If the vendor is inquisitive and collaborative, showing the client a desire to understand its needs and an ability to work with the client to solve them, it may be able to exploit the incumbent’s standard weakness of assuming it knows everything about the client.

Such a proactive attitude can also help overcome the incumbent’s superior knowledge of the environment. Though the new vendor may not have as much knowledge about the client at the beginning of the process, this approach creates the impression that the new vendor will catch up quickly and may even surpass the incumbent, because the incumbent lacks the forward momentum of the new vendor and is standing still. Clients are well aware of the incumbent advantage as well, and sometimes take it into account when considering how hard a competitor is working. As one team lead recently noted, “I think the client recognized that, for not knowing them, we did [a better job].” This is key, because, in the end, doing a better job and showing a greater willingness to address needs are two of the best arguments a prospect can make to itself for selecting your company over the incumbent.

Sales IS Customer Service

by Ralph Nielsen, April 8, 2008

The Dog and the Squirrel
Growing up I had a dog named Pipper (don’t ask). Pipper was a great dog and was considered part of the family. She was always friendly and obedient; that is until a squirrel came into the yard. When my dog saw a squirrel it would go flying after it barking her head off. There would be times when she would go tearing into the street after it. To ensure that she didn’t kill herself, my father jerry-rigged a rope line in the back yard that went from the back door to the tree at the back of the yard. This way Pipper could run freely within the limits of our backyard. One day I heard a ruckus and I looked out my back window and saw that my dog had a squirrel cornered up our tree. My dog had one goal, to capture that squirrel. My dog was jumping up the tree as far as she could go but the squirrel was always just a little out of reach. Suddenly, the squirrel started running around the tree. Naturally my dog was mesmerized and followed right after it. Soon my dog found herself tied up around the tree to the point where she could hardly move. Upon seeing this, the squirrel crawled down the tree and ran off.

What does this story have to do with sales? Sales teams have one goal; to land the next deal. At times sales reps use so many different tactics and sales strategies to meet that goal that they tie themselves up without even realizing it. They are so concerned about the potential traps and landmines that their competitors are planting that they forget about the most important goal: providing good customer service. When you forget about what’s really important, the customer will almost always slip away.

The Importance of Customer Service
So what exactly is customer service? There is not one clear definition; however, many times it simply comes down to treating a customer or potential customer how you would want to be treated — or better. Here are three specific ways three different companies used customer service to help land a deal:

1. Provide options
   We have one client who won a recent opportunity because they offered different options. Not every sale is going to be the same and the flexibility the client offered set it apart. First they offered a free mini-pilot to demonstrate the value. Next they offered two different implementation methods. The client gave the prospect the choice of having a hands-on or hands-off approach when it came to the implementation. This type of customer service impressed the prospect and played a large role in the final decision.
2. Know your potential customers’ business.
   Another client had a sales representative that was fighting for his life. The prospect really wanted to purchase from a competing vendor from the onset. The number one reason our client was chosen was because of the sales rep’s experience in the prospect’s industry and his understanding of the organization’s particular needs and business rules. The Vice President of Marketing and Strategy at the prospect’s firm said, At the end of the presentation, he [the sales rep] won us over. He spoke the same language we did. He spoke about solutions to problems that we currently have, and how other companies solve them. His ability to understand our business saved our people the time and all the resources it would take to bring him up to speed, explain our business, the ins and outs, and all the specific little issues that go wrong or could go wrong because of the way we conduct our typical sale. I would say it saved at least a year of developing the product. The prospect had no choice but to select our client. There was an obvious choice.
3. Pay attention to the little details and go the extra mile
   A potential customer really does notice the little details. They keep mental notes of how quickly vendors return phone calls and how long it takes to resolve issues. The little things demonstrate to the potential customer how important you think they are. A financial analyst for our client’s prospect explained how our client is always on the ball, “What they’re doing is giving immediate follow-up on any issues and, not only that, but they’re resolving them. I talked to the referral director yesterday because I had a small issue and he set up a conference call immediately with all the people who I needed and it was taken care of by the end of today. Their turnaround time on resolving issues is excellent.” This client was also willing to go the extra mile. It sent one of its senior managers in to reassure the CEO of the prospective company. He promised that if there were ever any issues he would personally take care of it. This client is not a small company, so it is impressive that it would go to those lengths to reassure a potential customer.

Customers vs. Prospects

by Adam Dunford, April 4, 2008

I’m in product development and as such I struggle with two competing audiences: my existing customers and my prospects.

While you might think these are the same peopleafter all, our prospects do become our customersthey are not. They have different expectations of our company, our sales people, and (most important to me) our products.

It’s not that they are misrepresenting themselves or that we do a poor job of transitioning them, it’s that what they assume they need before purchasing and what they actually do use after purchasing are often very different beasts.

A study released a few years ago by the Harvard Business Review (http://harvardbusinessonline.hbsp.harvard.edu/b02/en/common/
item_detail.jhtml?id=R0602E&referral=2340) found that when given the choice, new customers select the product with more features, but post-purchase, existing customers find more satisfaction with the product that has greater usability and less complexity.

To use a specific example, a few years ago I was involved in building web portals for state and local governments and one of the features that consistently came up was personalization, allowing users to change the color scheme or move modules on the page. While this was universally requested by our clients and perceived to be a great way to encourage usage of these portals, we consistently saw adoption lower than 5%, even among our own clients’ personnel. Users asked for but didn’t actually want the complexity.

Aligning Customer Satisfaction and Decision Analysis

To do a better job of gauging prospect desires and customer needs, I use two different tools: customer satisfaction and decision (win-loss) analysis. Customer satisfaction provides insight on existing customers, while decision analysis tells me what our prospects are looking for. Simple enough, right?

However, I make sure the same kind of information is being asked in both studies, so that I can do true comparisons and determine where differences and similarities lie. These include questions such as:

There are more questions that can and should be asked; the important concept though is that you need to design your research to be able to make appropriate comparisons between the two groups of customers. Without the ability to align the needs of customers and the wants of prospects, I cannot understand what my products need to satisfy the differing desires of each.

The question I pose to you is this: How do you decide whether to offer a feature rich offering that appeals to potential customers or to offer a simplified offering that delivers high satisfaction and retention for existing customers? I’m interested in your comments.

Are You Getting the “Rest of the Story”?

by Roxanne Loosle, April 1, 2008

On May 10, 1976, legendary radio host, Paul Harvey, began the popular series “The Rest of the Story”, which delved into unknown facts in the lives of famous people and events. Listeners were often surprised and their views expanded as a result of information gleaned from these shows.

Are you getting the rest of the story about your won and lost deals? If you are not delving into the customers perspective of what happened, you are not getting all of the facts. Sales people work very hard to cultivate relationships with their customers, but when the decision is made, will a customer feel comfortable enough to share the reasons for the decision with the salesperson, especially in a lost deal? Will they be completely honest? Customers value their relationship with the sales person and hesitate to be overly forthcoming. They know that relationship may come into play in a future deal and dont want to do anything to damage it.

Win Loss Analysis, like those done by Primary Intelligence, can get the rest of the story for you. Not only do these studies provide voice of the customer (VOC) data but they also provide the data analysis, trending, and consulting to help you understand the information and develop actionable tactics to increase the effectiveness of your sales force.

I repeatedly get feedback from my clients about how surprised they are about the depth and quality of information we are able to provide them. Even in post-implementation studies, where our client and the customer are very heavily involved with each other, we are able to provide valuable information that was not coming through before. Clients want to get you information that improves on what you can offer them. By systematically asking for feedback with a time-tested interview process, you obtain invaluable information on how to improve your products and fine-tune your sales practices.

For more information on Win Loss Analysis and Post-Implementation Studies, give us a call at 800-400-2174 or email us at info@primary-intel.com