Competitive Intelligence for Business

With all the attention on the upcoming presidential elections, I recently came across an article about an AP-Yahoo poll that showed that pet owners prefer McCain over Obama (http://news.yahoo.com/page/election-2008-political-pulse-pets-and-politics). My first impression was who cares? Not to offend any pet owners, but this is hardly ground-breaking political coverage, and the article was more filler than actual news. But someone thought it was worth their time and effort to point out which candidate pet owners prefer.

In sales we can easily fall into the same trap. There is a particular feature of our company’s product or service that we think the prospect absolutely needs to know about, but the prospect couldn’t care less. In such cases, not only do we waste time covering such matters, we risk losing the prospect’s interest by not focusing on what they consider important.

If you want to actually sell something to a prospect, you need to know what they want to know. Otherwise you risk wasting your time by giving them a lot of useless information.

By the way, the best part of the article was learning that George Washington owned a foxhound named “Drunkard.” Now, there is a bar bet if I ever heard one.

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As I follow the Olympics, one of the things I see on a LOT of places is the “Medal Count.” For example, here’s a summary taken from Yahoo! Sports (8/19/2008):

And, looking at the comments given by visitors to various Olympics blogs, these medal counts are a popular way of arguing America’s preeminence in the sporting world. However, as I looked at tables like the one above, it began to seem very familiar. At Primary Intelligence, we often ask respondents to rank criteria pertaining to the sales experience in order of importance, first through third. In the past, we would simply sort the criteria by the number of mentions they received to get an overall sense of what was important to our respondents. The results took a form very similar to a medal count table.

A potential problem we found with this system was that sometimes, the number of mentions was not the best indicator of importance—in some cases, it was which ones that were mentioned first that was the key. So, in these cases, we applied a standard weighting system to our responses (where 1st mention equaled 3 points, 2nd mention equaled 2 points, etc.), which sometimes gave us remarkably different results.

This seems to be the case with our Olympics example; if we use the weighting system, we get the following:

Using this particular method, America’s dominance in the Olympics is not so self-evident, which probably explains why most American news sources use the first kind of table.

However, this isn’t an argument about sports, politics, or what is on Michael Phelps’ iPod*. What is of interest here is that how you decide to calculate scores and sort those scores will have a significant impact on your final results. The key is that you must not simply calculate importance (or any other score) in a number of ways and decide which finding you like best, but instead, think carefully before you begin your study and decide which method will best answer your research questions. For example, if you are interested in learning what product features are “top of mind” for respondents, then asking them to name three features and then calculating their order by number of mentions would probably work well. However, if you are interested in which product feature they couldn’t live without, then you might want to consider making sure the responses are ranked when asked, and weighted when presented. By making these decisions early on in the study design, you’ll have more effective and appropriate results, and you won’t be accused of bias in your findings.

*Sorry, I had to mention Michael Phelps. It’s mandatory in any blog entry that mentions the Olympics. Not sure why.

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It can obviously be difficult to gain the trust of someone we don’t know. I think we have all grown more and more skeptical and distrustful of others not only because of crime, but because of being bombarded by those touting different products, opportunities, get-rich-quick schemes, etc. Of course it is a bit of a different story when a prospective customer sends out an RFP inviting specific vendors to bid for a business opportunity, but I think nowadays our trust issues spill over into anything related to business and what a company is selling.

Before we create a positive relationship with an existing customer, we had to gain their trust by doing such things as delivering what was promised and providing responsive and high-quality customer service. So then what is one of the best ways to gain enough trust from a prospective client? Utilize the positive relationships you’ve already created as referrals and as a way to continually improve the reputation of your company and its offerings. Regardless of the industry, I see again and again that decision-makers state that peer recommendations turned out to be the top marketing activity that influenced their decision in a competitive bid situation. And those peers are the people they trust most in gaining information about a company’s offerings, just as we would all trust a great friend’s first-hand experience with almost anything over that of an outsider.

To throw some data analysis into the mix, a client wanted to see which company, product, or sales team performance criteria most strongly correlated with decision-makers believing a vendor deserved a strong recommendation to other companies and friends. The results were not surprising, as customer service, relationship, and reputation criteria performance ratings were highest when the interviewees gave a strong indication that the vendor deserved a strong recommendation to others.

More often than not, your prospects will seek out a referral or do plenty of research on their own to reassure themselves they are getting a high-quality solution, regardless of how remarkable and valuable your offerings really are or how well you presented a product to meet a client’s needs. In the end, gaining the initial trust of prospects is created through your hard work in establishing and continually working on holding the trust of current customers, because that is who other prospects will trust first.

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For all the cheers and jeers coming out of the 2008 Beijing Olympics, I am fascinated by the controversies surrounding the seemingly diplomatic opening ceremonies. Almost moments after Olympic organizers were praised for the show, they were criticized for showing computer generated fireworks and dubbing the voice of a seven year old performer. While some chatter defends the decision as a creative choice, my sense is that the majority of viewers feel they have a right to assume authenticity and feel slightly duped. Regardless of where you stand on the issue, I think the event illustrates the value people place on legitimacy. Had the organizers been open about opening ceremony details, I doubt it would have been more than a blip on the news cycle.

Take a memo from this experience when considering the structure and presentation of your next RFP or other competitive situation. In these highly competitive sales scenarios, it’s natural to shine over the scuff marks of company failures or lags in capabilities to present the best image to the client. And to some extent, clients understand and expect this type of behavior from sales teams. The danger is when you cross from first date behavior to the smoke and mirrors routine.

In a recent interview, a respondent from a large bank noted that he was essential promised a ‘bank in a box’ solution from a vendor competing for his business. Not only was he dubious about the proposition, but also he thought it undermined the complexity of the bank’s needs. And as if they couldn’t stop digging the hole, the vendor then presented the most basic and uncreative solution. Naturally this completely underwhelmed the client and even made him weary of evaluating the vendor for future RFPs.

While this cautionary tale seems to highlight that playing it safe is always the best course, the reverse can be equally detrimental. Resistance to over promise impossibilities should not be replaced by basic and tired solutions. When approaching opportunities, find that delicate balance of innovation and reality; set up realistic expectations with the client that still can differentiate you from the pack of competition.

To boil it all down, ignore Napoleon Bonaparte’s immortal words: “If you wish to be a success in the world, promise everything, deliver nothing.”

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When I recently reached for the phone to activate a newly acquired credit card, I could not have anticipated the “thou shalt not take no for an answer” voice I would be greeted with on the other end. He was more than happy to activate my card before launching into a spiel about a free trial offer of identity theft protection—a trial offer I might have been interested in had his ridiculous vocal speed not convinced me that he was a) only trying to confuse me enough to slip out a “yes” before I knew what I was agreeing to, or b) trying to get me to say “yes” out of sheer desperation to stop his incessant babble. My first “not interested” was followed with a “why not?” to which I stupidly said something akin to “none of your business.” My response launched him into sales pitch number two, wherein he added a few veiled comments about my intelligence, or lack thereof, should I refuse his offer. Don’t get me wrong. I have no ill will for the poor chap who was quite likely reading a script of his manager’s making and would possibly be fired had he taken my first “no” for an answer. I was, however, annoyed with the lack of respect being paid to me by his utter refusal to accept my “no.”

Later, in a different conversation with another company, when I was again approached with a similar sales pitch, I proceeded to rattle off “no” three times, which I had found out later was the requisite number of refusals needed to bring the conversation to a halt.

There may have been some excuse for my credit card friend to push his product seeing as I had not given him a very strong reason for my disinterest, but in numerous business opportunities I have researched, vendors are told exactly why they are being dismissed from consideration, yet still continue to press the issue. “Saying ‘no’ to those guys was very difficult,” one respondent recalled from a recent opportunity. “I explained my rationale as to why we weren’t going with them, and after the decision, I had multiple contacts trying to figure out a way to get back in. I found it frustrating.” Another remembered a sales team becoming “belligerent” after being notified it had not been selected, and the effect was “a very uncomfortable set of interactions between their team and my team.” Asking for the reasons behind dismissal is not an outrageous request for any vendor to make, but frustrating a potential client with numerous “why not” calls is hardly a way to secure one’s place on a future short list. Doing so may stamp your organization with titles such as “relentless,” “belligerent,” and “abrasive,” which may result in you being left off the short list completely, or worse, never given the opportunity to present a sales pitch at all.

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