Podcast Transcript

[00:00:00] Welcome to the ScaleUps Podcast, where each week you get to hear Sean Steele, professional CEO, growth mentor and advisory board chair, unpack the strategies that successful Founders have used to achieve scale of their businesses. Stay tuned as he interviews the entrepreneurs who've made it, learns from industry experts and follows a group of Founders still striving to scale.

[00:00:30] Sean: G’day everybody. Just so that you know, in the last two minutes of this episode, we had a little technical glitch where we lost about 30 seconds of our guests’ audio, who knows why, but just to make sure that you've got a full and comprehensive podcast, I filled in the gaps for you in the last 30 seconds.

So be prepared to hear my voice in a strange little way, right near the end, but it's only 30 seconds and the rest of the podcast will still make sense for you.

G’day everyone and welcome to the Scale-Ups Podcast where we help first time Founders learn the secrets of scaling so they can fundamentally fulfill the potential of their businesses make bigger decisions with greater confidence and maximise the impact and value that they can create in the world. I'm your host, Sean Steele. And I'm joined today by Peter Strohkorb - Founder and principal of you are own aptly name advisory Peter. 20 years in sales and marketing roles, from SMEs through to multinationals before establishing your practice about 10 years ago.

[00:01:25] And you've been primarily focusing on the mid-market companies and helping them understand how buyers have changed over times and haven't they changed, and how to adapt their approaches using your proprietary method around, uh, the buyer focused sales funnel. How are you going today, Peter?

[00:01:41] Peter: Very well so far as can be expected under Sydney lockdown with the three teenagers in the house, one wife and one dog.  

[00:01:50] Sean: Oh, my goodness. Actually, I had a virtual dinner with friends last weekend because I've been in locked down like you for a good couple of months and they've got a six and a three-year-old and they're both trying to work full-time at home and they are struggling,  

[00:02:03] Peter: It is tough, but you know, the kids would probably say it's as much a challenge for them to cope with the parents as it is for the kids.  

[00:02:12] Sean: Yeah, big time. I reckon you're a hundred percent right. Well, you know, for the benefit of the audience, I read your first book about seven or eight years ago, which was the One Team Method. And this was when I was running some large sales and marketing functions, so we probably had a 130 - 150 people just in sales and marketing and I was really looking at how to get the best out of the alignment between those two, because I always found this culture that emerged as we acquired more businesses. Each business had this culture of sales telling marketing people, they weren't getting enough right quality leads and marketing people telling the salespeople, they couldn't convert them. And so on and so on. And I was trying to figure out how to get alignment out of these functions.

[00:02:56] And your book really changed how I thought about that permanently. And I know that you work with lots of different sized businesses, but also many of them, sort of a medium to large size, but I know that a lot of the principles that you teach are just as relevant to a first time Founder, who is trying to figure out how to optimise that sales opportunities.

[00:03:12] So, I really hope that today you and I get an opportunity to dig into how the buyer behaviour has changed. From your perspective, the things that you think Founders, that are still trying to scale up should be focusing on and how they should be thinking about building out their sales functions and so on.

[00:03:28] So, can we maybe start with you, let's start with you. How did you end up in sales in the first place?  

[00:03:34] Peter: Oh, okay. So, there is an interesting sideline to this because I met a guy in Sydney who runs a business that helps people to identify the right salespeople for them from a personality and skills and aptitude perspective.

[00:03:51] And he said something that's always stuck in my mind that namely that if anybody has had a lemonade stand or paper run or something where they sell by the age of 12, they’re innately pre-qualified to end up in sales later in life, you know, don't get me wrong. He also said you can acquire sales skills later.

[00:04:17] So it's not that you have to be born with it, but it helps if you have the mental attitudes and the tendency to do that. And I actually had my very first business at a very young age and so I must have been distant to do it. The other thing is that I've never been fascinated with selling per se.

[00:04:41] I've never been fascinated with closing a deal or any of those sorts of usual metrics that we apply to, but I've always been very keen on helping people. And actually my whole philosophy in terms of the One Team Method or now that the latest book is Marketing Sell Smarter, not Harder.

[00:05:06] And just holding it up here for those on. The principle has always been that if we switch our focus from how we want to sell and what we want to sell, to helping people to buy from us, the whole dynamic changes. This whole pressure to succeed, goes away.

[00:05:30] This pressure on the sales reps, that comes down from above, the pressure that they then pass on to the buyers so that they feel pressured to make a buying decision as quickly as possible. And even when then, whether they're ready or not, all that really goes away. And I had a little bit of a, not an epiphany, but a quite an aha moment when I was asked to find a sales training course many years ago for a civil engineering company. And so, they sent me all these civil engineers and they said, teach them how to sell. And that the challenge for the CEO was that they were all reactive responding to tenders, but the CEO wanted them to be proactive and get more sales that way.

[00:06:23] So, I started the session off just by asking them when they hear sales pitch, a sales person, like a sales rep, what images did that conjure up in their mind? And you can guess what they said, right? They said, lying, cheating, tricky bastard used cars, all those cliches. And I went okay.

[00:06:49] Yeah, Sean. And I want to relay another story to you, this is when I was working with a civil engineering company a few years ago now, and the CEO wanted them to stop being… well, in addition to being reactive and responding to tenders, the CEO wanted these engineers basically to learn how to sell and be proactive about it.

[00:07:11] So, this was a physical event before the pandemic and we were sitting, we were in this room together and I was at the whiteboard and I just said, look, if I say sales rep, what image does that conjure up in your mind? And you can imagine what came back.

[00:07:34] They said lying, cheating, tricky, bastards, used car sales person, all those sort of cliches, and they really hated the idea of having to sell. Like it was totally foreign to them. It was something that didn't really want to be associated with at all. And in fact, they didn't even want to be in the workshop.

[00:07:56] So, a great start for somebody in my position. But the way that I brought them around was that I said, okay, is that okay to help somebody to make an informed buying decision? And they said, well, selling is bad, but helping is good, basically. And so, by changing their mindset and saying like, we're not trying to shove something down somebody's throat, but we're trying to help them make an informed buying decision that just changed the whole dynamics for them.

[00:08:29] And as I said, it also changes the dynamics for the buyer because they don't feel pushed and pressured and closed always, because all those techniques all the time. And it's a much better selling experience and it's a much better buying experience when you adopt the attitude of helping somebody to buy. And you mentioned, the buyer focused sales funnel earlier, right? The methodology. So, let me introduce you to that. You know, the traditional conventional sales funnel, where you say, put leads into the top, then they get nurtured. They get passed on from marketing to sales, sales then follows up the leads and eventually *kiching* *kiching* sale drops out. That's the traditional sales funnel. Have a guess when that was first invented. What year?  

[00:09:26] Sean: Oh, I don’t know the answer to that question.  

[00:09:29] Peter: Okay. Which century?  

[00:09:32] Sean: Oh, not the 20th century.  

[00:09:35] Peter: Nope, it was 1898 when it was invented. So, 123 years, we've been using a concept that was invented long before the internet, at a time when sellers had all the information and buyers had none. And it was based on driving a sale forward by informing the buyer and pushing them to make a buying decision.

[00:10:00] Sean: Sorry, just to add to that, those of us who, around before the internet, we'll remember that actually real estate agents and car salespeople had a tremendous amount of knowledge.

[00:10:11] Like I remember those interactions being exceptionally different because you didn't have anyone armed with all the information, you didn't rock up with all the data and say, well, I've looked at everything in the market. Let me tell you what I want. It was entirely the opposite.  

[00:10:24] Peter: No, very few buyers would actually go out and look for information before speaking to a sales rep. In fact, they would proactively ring, you know, two or three or four or five sales reps and say, what have you got? Nowadays, the saying is that, about two thirds of the buying decisions already made before buyers contact their first rep because they do their research online and they narrow down the field that they choose, which two or three they don’t select to. And whom they want to talk to. If you're not one of the two or three that they contact, you wouldn't even know the deals going out, the deal exists.

[00:11:06] And then even if they do contact you, you still got to battle it out with two or three others that they've also researched. So, selling hasn't really become easier. It's just, the buying has become a bit easier perhaps, but even gartner even disputes that, so let's not go down that rabbit hole, but I was going to say, I've got two problems with the traditional conventional 1898 sales funnel.

[00:11:29] And that is, it's completely focused on how we want to sell and how we want to measure the progress. And the buyer doesn't even get a mention. That the buyer is kind of a bit of an afterthought at the end of the sales process when the transaction happens and that's just…

[00:11:47] Sean: In that model, they're just a little data point somewhere in this magical funnel, their percentage that gets left behind somewhere doesn't get through to the bottom.  

[00:11:57] Peter: Yeah. The problem is that the buyer doesn't even feature in there, yet in today's market, that's the most important part, right? So, I'm saying let's not use 123-year-old model anymore. Because the other thing that drives us to do is to say, ah, it all starts with a lead and the more leads, the better.

[00:12:20] And since I did 1898, we’ve had a bit of development in technology and we have now the, the MarTech stack and the sales stack and technology allows us now to reach out to anybody we like. The most senior people we can find them, we can get their email address. We can maybe even get their phone number, we can reach people. All right. So, the technology allows us to reach people, but just because the technology allows us to do that, doesn't mean that's what we should do, because modern buyers don't want to be spammed with glib email messages that are by the very nature of the beast, one size fits all.

[00:13:03] Because if you send the same email to 10,000 people or a hundred thousand people, you've got to sort of make of lowest common denominator so it suits everybody. They don't want to be interrupted, have their day interrupted with unsolicited cold calls. And in fact, just this morning, I was speaking to somebody in New York.

[00:13:24] And I actually asked them, I said, how many cold sales calls do you get every day? And he said, he gets about between 20 and 25 every day. He is a very senior guy. I then asked him, how many of those calls does he take? And he said at most one or two. So, what's the point of getting very junior people to ring very senior people, hoping to get engagement and maybe an appointment with them. And so, we were actually, this person in New York and I, we were actually talking about setting up an SDR function forum.  

[00:14:02] Sean: And can you use to explain SDR?  

[00:14:04] Peter: These are cold calling, outbound sales reps, who we used to call suspects to turn them into prospects and turn them into customers. But to start a conversation and get them interested in what they're selling, the problem with that … we don't use it anymore.

[00:14:23] Have you noticed that everything is a lead now? Everything is a lead like a faceless list of contacts. It's now called a lead list that at best that they're suspects, they're not even prospects because they are not qualified. Anyway, we'll get off that soapbox now. But the point I'm making is that more is not better.

[00:14:47] More is just more. So, just because the technology allows us to reach anybody, that’s not the end game. The end game is to engage with the right audience. And I used the term engage purposely because unless it leads to a sales conversation or even better, a business conversation, it's just a bothering people.

[00:15:14] Sean: Well, I think this comes right back to your original point around the psychology of what is selling about, because I always used to communicate to my sales teams that, if you just replace the word sales with serve, that's the whole point, right? I always ask people to get their detective hat on.

[00:15:32] So, you know, you need to understand actually, what are the pieces of information that you need to understand the answer to, to know whether actually what you have is a potential solution or is not a potential solution to that. So, essentially you're just on a fact finding missing, you are in detective curiosity mode and in the absence of knowing that information, you have nothing to offer.

[00:15:54] There is nothing to sell and your job is not to push that or influence. It's to see if those needs actually match up, if the needs match up, what you are doing is saying, hey, here is something that actually could help you service those needs. Are you interested? That's a very light touch, that's a low pressure, that's a very logical sort of process with people to go through and to your point, it takes away all of that sort of mystery. I need to be an amazing influencer and incredible a song and dance machine to be able to convince someone, to buy something that they don’t need. That's not what it's about at all.

[00:16:27] So given that shift to, okay, well, people actually want to be engaged, what's an example now of what would be best practice. If you let's say you had a B2B business, you identify that you'll ideal decision maker is a, you're selling I.T services, maybe, your ideal decision maker is a CTO, and all you have is that lead list. To your earlier comment, you have the person's name, maybe have their email address, maybe you know where they are on social. You've got a LinkedIn profile, maybe even have a phone number. What do you do with that? What does the current world look like as to what would be an appropriate way to build some engagement, start to build a relationship, get into that business conversation.

[00:17:08] Peter: So, the buyer focused sales funnel structuralise all that. So, it starts off with saying, who are our ideal prospects, really? Where are they? How do we get to them? And very importantly, how do we engage with them? I'll come back to that in a minute. How do we fend off our competitors? How do we win the deal?

[00:17:34] How do we not just win that deal, but also get repeat business from the same customer, and last not least, how do we turn our repeat customers into advocates for our business, so that they refer new business to us. Alright. So, I want to come back to the engagement part. We’ve established that technology can get us to anybody, but that doesn't mean we're engaging. So, the way to engage is to create what I called ‘the lean forward moment’. And the lean forward moment is a moment when a rep says something to the prospect that intrigues them, stops them in their tracks and goes, that's really interesting, Sean, tell me more about that. And literally they lean forward at that time.

[00:18:26] And at that moment, they also give you the explicit permission to sell to them because they're showing interest. And I talk about the seller having to get permission to sell and not just jump out of the bushes and ambush the unsuspecting prospect with the sales pitch.

[00:18:48] Sean: It's not almost permission to sell, it's permission to ask questions, right? It's like, well, you may have garnered their interest and gathered your lean forward moment. But that doesn't mean that you still know yet whether actually what you've got is suitable for them. So, I always think it's like, okay, they lean forward and you lean back and they go, hey, I'm interested, tell me more. And you go, well, hang on a second. I don't know whether this is right for you. So let me get into detective mode, give me some permission to ask some questions so I can get curious on you. And if I get to the end of that, and I think there's actually something here that's a value to you. I'll explain to you what that is, how it works, how much it costs, all those things.

[00:19:22] If I don't think it's a value to you, I'm not going to be selling you anything, but you've got to give me some space to be able to get those answers. Do you feel that is how things are still playing out?  

[00:19:34] Peter: Almost. So, the buyers these days expect you to have done your homework so that you already know enough about the organisation. You don't have to start with 20 questions. They don’t give you the right to ask 20 questions. But once you've said to them, well, whoa, I'm not here to sell you anything, or I'm not sure whether I can sell you anything, because I don't know whether this is a good fit for us. The buyer goes, what? You're not trying to sell?

[00:20:13] And they almost get a bit defensive and say, no, no, no, no, no, no. I was still interested. So, it's actually quite a good technique to say, look, let's just establish whether this is a good fit for us or not. It's not a trick, because let's just face it. If there's not a good match, we're both better off knowing. And we both set off saving our time. It actually helps both parties. And if there is a fit, then we go, okay, now we know there's something there. Let's talk about some more, right? So, there's nothing wrong with say, let's just see whether there's a good fit for us first. But then you can't just go; oh, we do this and we have that and we so great, something I call we-we syndrome.

[00:20:55] But letting the buyer talk about their particular situation, their challenges, their circumstances, so that you can say, oh yeah, actually that matches with what we're doing and here's why and how you can get it. So, establishing a match really early on…  

[00:21:15] Sean: Can you give me an example of something that would get the lean forward moment to happen.

[00:21:19] Just give me an example of it, this might be a LinkedIn message or, what would be an example and just some actual language that people will go, huh, that's actually pretty and that get them to link forward..  

[00:21:31] Peter: Excellent. So, for example, I used myself as an. I always teach my clients to not talk about ourselves. Like I try to avoid we-we syndrome as well. And the trick to not talking about yourself is if you start the sentence off with ‘my clients tell me that…’ or ‘my clients love us because…’ So, my clients love it, that I teach them within six weeks how to sell more faster. And I do that through a program that's delineated in time, in scope and in dollars.  

[00:22:09] Sean: Got it.  

[00:22:10] Peter: So, six weeks, fixed price, fixed scope, fixed duration, and they go, okay. That's interesting, but it just leave it hanging there, and wait for them to then ask the next question and create that lean forward moment that way.

[00:22:27] Sean: Yep. Got it. Okay. Now as much as I would love to get you to take me through every single step of a typical sales process, I know how much time we've got available. And so, one of the things I really want to get out of you today is, you’ve seen sales functions and sales practices from very small companies to very large companies.

[00:22:47] And so you have an across many industries in both B2B and B2C environments. And so given the nature of our community, which is typically those first time Founders still scaling their organisations, probably still sub 15 million. Some of them are probably still the lead salesperson, maybe some have a sales team, maybe some only you have a few salespeople. What are the three or four key things that you think a found a really needs to focus on in order to scale their sales outcome, really, which is what they're after.  

[00:23:16] Peter: Okay. So, I've had a bit of experience with start-ups. And pretty much, they all do the same thing. They're really focused on the product or the app or the thing that they're building and sales often becomes a bit of an afterthought.

[00:23:38] Initially, it's all about pitching not to customers, but pitching to investors and customers sort of become a bit of an after-thought. They go, ah, when we released the product, that's when the selling starts. And they often come from a technology background because they're a bit geeky, they've developed the product or the app themselves and driving it forward.

[00:24:06] So they're totally focused on what they're selling, but not on how they want to sell or how they should sell. And then one of two things happen. One is that either the Founder starts trying to sell themselves and because they’ve never sold, that doesn't go well. Or they make a few sales to people in their network just through their relationship, and somebody feels sorry for them by something that they go, Ooh. But that doesn't last forever because they're going to run out of context to buy. The second mistake that they make is to go and say, oh, I need more sales, so I need to hire a sales rep, a BDM. And I've had lots of conversations with Founders who come to me and say, I want to hire a BDM. Do you know any? And I always ask them the same thing I say, do you have a value proposition that's proven? Ah, do you have a sales process that engages with a prospect, draws them into a business conversation and helps them to make a purchase decision? And they all say… sorry, founders. But they all say; I want the BDM, bring that with them. And they don't realise that the BDMs job is not to set up a sales function and to set up the infrastructure and to set up the process. What the rep wants, what the BDM wants is to come into the organisation where that's all set up for them, where they can just land on day one and start producing from day one. They don't want to spend two or three months working on the sales process and working on testing a value proposition and setting up a CRM system, you know, that's not their job and they're not getting paid a commission while they're not selling and doing that instead.

[00:25:57] So, as a consequence of all that, what happens inevitably is that the rep stays a couple of months, maybe three, then says, I’ll bugger that, leaves and moves on to greener pastures. And the Founder has got to start from scratch again. So, my advice to all the Founders is, get yourself a sales process, get yourself a sales funnel and get yourself a value proposition that is proven and already working. And then you can plug in more salespeople. You can plug in more leads into the top and more sales will drop out the bottom.  

[00:26:29] Sean: That's very interesting. And it makes me reflect on one of the strategies. A long time ago, one of my marketing managers actually told me and he said; you know, Sean, we've got all these leads coming in and I know everybody wants more leads and we're willing to spend the money. He goes, but 90% of these people have had interest and don't convert.

[00:26:53] And we don't know what the problem is with the 90%, we're all very focused on the 10% and trying to get 10 to 11, or 10 to 12, or just increase the number of leads so more of those 10% it's into sales. but actually shouldn't, we go through an exercise of just getting rid of the no’s. Like, what are all the reasons for the no’s? Can't we just systematically go through and get rid of each one of those no’s with that value proposition, take away the reasons they're not buying?

[00:27:16] Okay, it's not going to get it from 10 to a 100, but it's probably going to go from 10 to something, something better. And we're already paying for those lead. Oh, by the way, we've got 30 or 40,000 of those people in the database as well. Maybe we can go back to them.

[00:27:29] And I really changed my mind when it came to thinking about the value proposition. I really agree with you. I think that's a… if you don't have a value proposition that's already working and a sequence, which fundamentally as a Founder, you've got to figure out and you may need some support to kind of work through that process. If you've got no sales background whatsoever, you might need, but you've probably… Do you need help for a marketing person or do you need help from a sales person? What do you think, Peter?  

[00:27:54] Peter: I think you need help from the sales person first, but, you now, that's why my books called Smarketing because, I believe that sales and marketing should really be seamless and not be in separate silos and separate functions.

[00:28:10] But the interesting thing about lead gen is that people go for volume, oh, we need more leads, but if you think about it, you don't need more leads, you just need better leads. So, it's much better for you to have a smaller number of better qualified leads then than a thousand lukewarm ones.

[00:28:37] And the other thing that I totally agree with you on is that qualifying an opportunity out, is just as important as qualifying an opportunity in and because it saves you so much time, just like we talked about earlier with, you know, is there a good match for us? Yes or no? So, if you make the first port of call for your sales funnel to say, look, is there even a good fit, you can save yourself a whole lot of heartache down the track because there's a lot of CRMs that are full of junky sales pipeline.

[00:29:11] Sean: You know, I sort of jumped down on you there. So, you're saying, okay. Some of the mistakes that Founders make. One, they are sort of focused on the investor pitch, not the customer pitch. Two, they're sort of step one, I need some sales to go and get a sales rep and then assume that the sales reps actually get to build the function.

[00:29:26] What else do we need to be thinking about? And so, because I've caught also the mistakes, but then we really want to make sure we go, okay, well what should they be doing instead? So, let's continue on the mistakes. What else?  

[00:29:38] Peter: I’ll be very clear on what problem your app or your solution solves. Talk about how it helps the customer to overcome a challenge, to avoid a risk or to take care of and to make use of an opportunity. Don't talk about the product or the app or the service. Talk about what outcome is achieved for your ideal customer. And if you then have a story to tell that says, ah, Mr. Customer, Mr. Prospect, you remind me a little bit off this other company that we've helped where and then I say there's actually three, some say four, steps in how to tell a story. And they are, say, what the customer looked like when you first met them, what were the challenges? What were their problems? What were the consequences of that problem or those problems? What were the consequences of those problems for the individual, for the peer of the individual that you're talking to? So, if we're talking to the CIO, you mentioned earlier, we say, oh, that other CIO, he nearly got fired because all these other things happened and he was coming home, stressed through the eyeballs and brought a stress home. And his wife wasn't very happy with him and, you know, he had done a lot of difficulty in his life. But then what happened was, we did this and then we talk about what solution we implemented, how long it took and what was involved.

[00:31:05] And then the step three is, what changed for the customer? So, the customer went from losing money, spending too much time, having problems with customers, to making money, to saving time and to having happy customers. And by the way, the CIO’s wife is not happy with him as well because he doesn't come home as stressed to the eyeballs anymore.

[00:31:32] So, it takes a business proposition and it turns into something quite relatable and also a bit personal because if we're relying that the fate of the CIO that used to be stressed to the eyeballs and now is no longer, then our CEO, the one that we're talking to might say, well, I want to a bit of that too.

[00:31:55] And then they might go, well, how would that work for us? And again, they give you the permission to sell to them. So, storytelling is very important in business and founders don't do enough of it because they focused on how great is their product, because it's that little baby, the one they’ve nurtured and brought to life. But unfortunately your buyer is not interested in your product app or service.

[00:32:19] All they're interested in is, what does it do for me? What's the outcome it achieves for me. What's the opportunity it creates. What's the risk of the voids or what's the, the problem it solves for me?  

[00:32:29] Sean: That sounds so simple, but I guarantee, and there are plenty of Founders who will be listening to this today who have no technology background whatsoever, they're running a services business. They don't know a sort of an app from something else that's more technical. But do some dummy calls and listen to your sales team and put Peter's lens back on when you listen to that phone call in terms of what's being asked in terms of the questions where they're heading and where the conversation ends up, because I guarantee that 75% of that conversation is going to be your team doing exactly what Peter just told them not to do, which is we have this, we have that, we have this, we have that, we have this, we have that. Would you like it? It's like, hang on a second, our whole business. And the reason you probably set your company up in the first place is because you saw that your product or service could be a vehicle to an outcome. But when everybody gets focused in, on selling the thing, they're all focused on the vehicle like everybody wants the vehicle. Well, let's be clear. Nobody wants the vehicle. Nobody wants to buy the thing. They don't want to go through the thing. They don't want to have to work with the thing. Everybody wants to see the outcome that's on the other side of the thing. And so, if you imagine your business always, I always think of it's like the person is A, the outcome is C, and B is how you're going to get them there.

[00:33:48] Don't spend time. The part that's B is actually the smallest part that matters to exactly the way that you just said it. What was going on A, what was happening at C, what was the person trying to achieve? The B is the bit that they link the thing together, but actually no one really cares about B. I always think about this in education.

[00:34:06] How many courses have you ever done where you really wanted to know the knowledge of the course. People spend, you know, tens and tens and tens of thousands of dollars on degrees. Do they actually want to learn the stuff in the degree? No. They want to be on the other side of the degree, doing the thing, doing the job, getting the outcome.

[00:34:22] No one wants to actually do the study. The study is boring and it's hard and it impacts your life, and so on. It's like, it's not about the study people. It's about the thing on the other side of the study and where they're at right now, how do we bridge that gap?

[00:34:34] Peter: Yeah. it's like the old analogy of don't sell the customer a hammer when all they want is a picture on the wall. Talk about the picture on the wall. Don't talk about the hammer.  

[00:34:45] Sean: Agreed. What else are we missing here, Peter? What else found Founders need to be thinking about?  

[00:34:50] Peter: They need to be thinking about the competitors. Because a lot of Founders think they don't have a competitors because their product is so unique. And sorry, but it's not.

[00:35:02] And even if there's no exact equivalent off the same product or service or app that you're selling. There'll be something else that competes for the same dollar.  

[00:35:12] Sean: There's an alternative always. Yeah.  

[00:35:14] Peter: Well, or even if there's not, but there's something else that your customer could spend that money on and not buy yours. So, the buyer focused sales funnel talks about how to combat your competition, how to evaluate them, how to basically make them relevant.  

[00:35:36] Sean: And in a nutshell, how do Founders do that. What's the practical thing they need to thinking?  

[00:35:41] Peter: So, I advise my clients to proactively bring up a subject that your competitors will most likely try to avoid. And that subject is the subject of risk. Buyer risk.

[00:35:58] Sean: Okay.  

[00:35:58] Peter: Most salespeople would say, oh, Mr. Customer, Mrs. Customer, there's no problem here. Look at how successful we are. You'll be successful as well, just trust us. Whereas if you say, Mr. Customer, would you agree that there's a risk in every business decision that you make? Yeah. Okay. So, then you understand that there's a risk in this, and you're making this a business decision as well. Yeah. And the buyer probably think where the hell is he going with that, but you're leading them to a particular thought process. And then you say, that being the case, would you like to know what risks you're exposed to as a buyer in making this particular purchasing decision, regardless of whether you buy from us or from anybody else? What have I done right there?  

[00:36:56] Sean: Well, you're actually kind of taking the scorpion or the white elephant and you sticking it right on the table and you're setting up a conversation to be out articulate. Like you don't have to come in and how everybody else deals with risk, you're actually creating credibility and trust in the process because they're like, wow, they're not running away from what I was sitting there thinking about in the back of my mind. I just put on the right on the table.  

[00:37:16] Peter: Exactly, Sean. I've positioned myself on the same side as the buyer. I'm saying, look, there's a big, ugly, dangerous world out there. Let me show you how to avoid it. So, we've moved from the opposing ends of the table and making an adversarial relationship, where I'm trying to shove something down your throat, to helping you make an informed buying decision.

[00:37:35] And then you say, well, look now that you've asked me to point out to you, what the risks are, I'll say to you, these are the risks and blah, blah, blah, three or four risks. And the lowest common denominator to nominate of risk is, Mr customer you'll spend your money and you won't get what do you think you paid for? That's the lowest common denominator. So, everything else, you can say, look at the implementation can go wrong. The support could be bad. The warranty might run out or, you know, whatever the risks are for your particular product service or app.

[00:38:16] The next question is then to say to the customer, Mr. Customer and Mrs. Customer, would you like to know how we at XYZ corporation help our customers to mitigate those risks? Yes, I'm will. And so then you say, well, I'll be mitigate these risks by having a warranty, by having credentials, by having done it before, by having a support and maintenance process, you know, whatever you do to make sure your customer is safe and that they’re making a good decision and they're being well, the feel and are well supported.

[00:39:01] So what the customer will think then is, hang on, every other bastard has said, trust me, there is no risk. This guy is the only one that's mentioned risk to me and he's told me why they care about it. And he's told me how they avoid it. I think I'm going to trust this guy more than anybody else. So, you bring up proactively something that your competitors will probably avoid.

[00:39:26] Sean: Yeah. I always imagine that. I love that. And I always imagined it as everybody's sitting around a meeting table in a board room and there's a scorpion running around on the floor and no one's talking about it, but everyone knows that it's there and it's like, can someone please pick up the scorpion, stick it in the middle of the table. And say, did you know there is a scorpion in the middle of the table? And everyone on guys, oh my God, this is going on. And I was like, yeah, but we can talk about it because now we've got a strategy. We're all saying the same thing. We're talking about the same thing, it's not running around. We're not like running around scared in the back of our minds. Yeah. It really brings it into the light.  

[00:39:58] Peter: There is one more that I can relay to you. And it's actually a real-life working example. So, I talked about that once we fend off our competitors, we need to still make sure that we win the deal. And there is a technique that I teach my clients on how they can get themselves a second or maybe even third bite at the same cherry that will not be available to your competitors. And this only works if it's not a tender situation, So, what happens is the customer will usually say to the rep, sent me a proposal. What's the worst thing you can do when somebody asks you to send them a proposal?  

[00:40:54] Sean: To send a proposal say great, when you've had a look at it, let me know what you think.

[00:40:58] Peter: Exactly. So, when the customer says, send me a proposal, the worst thing you can do is send... So, what I teach my clients to do is to say, that's great, Sean, I'd love to send you a proposal. It is very important to us at X, Y, Z corporation, that our proposals meet your exact expectations. Therefore, can we get together on Thursday at 2:00 PM to walk through the proposal, just to make sure it fits your requirements.

[00:41:35] So, there's two ways this can go, right? One is the client will say, yup, that's great. Glad you care. Let's get together on Thursday at 3:00 PM. What does that show you?

Sean: They're engaged.

Peter: They’re serious about giving that business to you part. What happens if they say, no, that's fine. Just send it through it the way it is. So, you think, okay, that we're probably the third quote that they need to get for probative reasons. They may have already decided who they're going with. We've got pretty much zero chance of winning this deal. If that happens to you, then you've got to make a decision. You can say, okay, look, we'll just going to throw our hat in the ring and send the proposal out and cross our fingers, or we can cut our losses and say, very sorry Mr. Customer. That's not how we play. It's very important to us that our proposals hit the mark. So therefore, we won't be bidding. That's very courageous. You've got to be very courageous to do that. But there is a third, compromise solution that you can use as well. And this is where you send the proposal, but you don't date it. You do not sign it. You take out all pricing and divide a big fed, watermark, let us draft all over it and send it off. What will happen?

[00:43:11] Sean: They're going to find call if they're interested, going; what is all this draft all over my thing and where's the pricing?  

[00:43:18] Peter: Where is the pricing. Right? So, then you can say again, Mr. Customer, there's no point putting pricing to something that we're not sure will suit you. So, therefore, we've just sent you, as a courtesy to you, the draft so that you can have a look at it and say, whether it's worth us putting pricing against it or not. Now, the customer might by that stage, get totally cheesed off and never do business with you again. Or they might say, look, these guys are actually serious about doing the right thing for me. So, I better let them. On the other hand, if they say, yep, I'll get together with you at 2:00 PM on Thursday, then they will actually help you to write their proposal for them. Because they might say, ah, that's not what we meant, or no, no, we don't need that. But we need a bit more here.

[00:44:16] Sean: Or they are teaching you, I think sometimes depending on who the person is also how to sell they may have some other sign off, okay, they are the CEO, but I don’t know, the CEO has to tick it off or something. And they're going to be in that meeting, thinking what's the CEO going to do when he sees that written, okay, we need to write it this way because I want to get this thing over the line.  

[00:44:33] Peter: So, they help you write your proposal for you. Now, I want to give you a very life story about that.

[00:44:39] So, I've got a customer in the States on the west coast of California, west coast USA. They're in a technology advisory business and a customer rang them up and said, look, can you send us a proposal? And, and this CEO, the president, he said to the customer. Yep. That's fantastic. We really pride ourselves in getting that proposals right, so can we get together? This was a multimillion-dollar project and the proposal was for that multimillion-dollar project. When my customers said to their customer, can we get together to make sure it suits you? They agreed. And they sent their entire executive team into this meeting. It lasted for two and a half hours. Do you think after all that effort, they would have gone to somewhere else and done the same thing with somebody else?  

[00:45:38] Sean: No one else would’ve even asked them the question.

[00:45:41] Peter: So my customer won a multi-million-dollar deal just by asking that question saying, can we get together on Thursday at 2:00 PM?  

[00:45:48] Sean: Yeah. I love it. And to your earlier point, it's equally applicable to smaller company, it doesn't have to be a multimillion dollar deal. This can work anywhere.  

[00:46:00] Peter: It's magic.  

[00:46:02] Sean: Yeah. There's that DPM. I like it. Peter, conscious and how much time we've got left. One of the things I'd love to talk to you about and get your perspective on is, how Founders might think about building up that sales function. So, let's just say, you know, you've got a founder who is okay. They've figured out their sales process. They've been working on their value proposition. They can see it's working really nicely. Now they've gone and maybe I've got a couple of people on and they're managing them directly, but they don't want to manage the sales team. Maybe they've got two or three people that's about as much salespeople management as they can possibly handle. And now they're really trying to figure out how do I scale this thing without me having to manage everyone. But is it too early to be hiring a manager? Do I take one of these reps and have them sort of step up as a sort of play a coach type model? Like how should Founders be thinking about how they build up the sales function once it sort of started and it's working?

[00:46:59] Peter: It's a tricky one, not just for Founders, but for leaders of all size companies. And the temptation is to promote your best performing sales reps into a sales leadership role. But do you think about it, many sales reps get promoted to the point of incompetence when that happens. And it's nothing wrong with the sales reps. It's just, they were a star, individual contributor, a star performer by themselves in a sales role. Suddenly, you're taking them out of that environment and you're sticking them into a position where they have people under them and they got to be a people manager when they've never led people before and managing people is quite different to managing sales. And, so what then happens is that the rep that's been promoted will then say; well, everybody just do what I used to do when I was a rep, and then you'll be successful as well.

[00:47:53] But they can't be that guy, or that person. So, don't promote anybody to the point of incompetence and make sure that they're supported. Don't stick them into a sales training course, pat them on the back and say, good luck to you now. Because any sort of training, doesn't matter whether it's product training or sales training, or any sort of skills training, will go in one ear and come out the other, if it's not supported with ongoing on-the-job coaching to bed in the learnings and to actually apply them to real life situations.

[00:48:29] So, I say that a sales leader must be a leader and not just a manager, they must actually support and help their reps to be the best version of themselves that they can be, not bash them up every Monday morning in a cadence call.  

[00:48:49] Sean: Yeah. We see that a lot with salespeople get that put into management roles because that's almost how they flagellate themselves every Monday morning, it might be their model of the world. They just beat themselves up because they didn't make enough calls last week.  

[00:49:03] Peter: They don’t have to beat themselves up, they get beaten up from the boss every week as well and every month, you know, and particularly when it comes to those crunch times, end of month, end of quarter, end of year. And there's another funny thing that happens by the way, that is, at the beginning of the quarter, the sales leader might say; Sean, take your time, get to know your customer, understand what their problems and opportunities are and get to know them a bit better.

[00:49:28] Three weeks later at the end of the quarter, they go where's that sale, close the deal. So, you go from one extreme to the other and the rep totally gets confused. And from wanting to be nurturing, to wanting to pressure the customer to buy. So that's another dichotomy that disturbs me about conventional sales processes. But the problem is quite easily solved. The problem that you described, namely, how do we scale is quite easily solved if you have a structured, proven, and scalable sales process set up, and that's what the buyer focused sales funnel does. It sets up a sales framework that is scalable. And like I said, you can plug in more reps and more sales will come out. You can plug in more leads and more sales will come out, and do you never really need to change it dramatically.

[00:50:19] You might just tweak it. If you have a new product or you go into a new market or you expand internationally of whatever are doing. But if you have your sales process set up well right from the start, you will not have a problem with unwinding things that you just sort of threw together in the beginning. If you have one sales rep bringing their process, and then you have another sales rep bringing another process. By the time you have four or five reps, you end up with a spaghetti warrant of different processes and different experiences that your customers have, depending on who they're talking to and it will never be consistent. So, my advice to anybody is get your house in order, get yourself a nice, structured, scalable, and proven sales process that you can then use to grow the business with. It's simple if you get it right at the beginning.

[00:51:07] Sean: Yeah, makes a lot of sense. And I think sometimes a Founder who's growing out a sales team will start with, and I guess it depends on the level of sophistication of the Founder in sales and sales management and how they have done it before to then sort of know what they're doing or do they need more help, sometimes a better model if you're just building out your sales team is actually getting a more senior person. I don't mean like super senior, but let's just say as your first sales person, get somebody who's actually capable, who's got the leadership chops. That they've managed a team before, they get to be capable of growing the team under them and have them work with you build out that sales that funnel and really optimise it, but they're going to be doing the sales themselves for a shorter period of time because I'll get it right faster and then they can build people underneath them that can quite often give a Founder more support. But yes, it means you have to invest a little bit ahead of the curve, but at sometimes a faster way to build out the sales function rather than getting a whole bunch of reps until you're drowning in your sales management workload and then hoping that you'll get a leader who's then going to be able to get the most out of them and not all of them gel together. That’s just one why people can think about it too.  

[00:52:16] Peter: Well, that takes a lot of foresight on the behalf of the Founder though because he must be willing to invest.  

[00:52:20] Sean: Sure. But there are definitely Founders out there that I've worked with, that have thought about it that way. And for that exact reason, so that person also gets the joy of getting to build a new team. You know, they might be comfortable leading a team or multiple teams, but actually are on the journey with you and your business, love where it's going, want to be the one to build out the sales function. So, you invest a bit further ahead up, but they've got to be willing to get in and do the sales and get themselves first, and that'll talk quite a lot of that characteristic of the individual, you know, are they willing to be on the frontline with the team? Are they happy to do the sales? And then grow the team after them assuming that they're not going to stay stuck in the sales.  

[00:52:57] Peter: I had this conversation with a Founder just not long ago. And I said, okay, how much do you think such a leader is going to cost you? And they said, well, you tell me. And I said, it's going to be north of 150 K maybe 200 K. How long will that take to set up everything on the sales process and the value proposition stuff? They said, well, maybe six months.

[00:53:18] So I said, so you're going to spend a hundred thousand dollars on getting a sales process set up first and they went, ah. If that's the way you want to go, you got to be prepared to have that investigated and take the time to get that right at the beginning. I don't know how many Founders have that patience and have that gumption to go down that path.  

[00:53:43] Sean: I can't imagine you'd be starting cold to be able to bring on that kind of model.  

[00:53:48] Peter: So that's why I'm saying, just get a sales process set up by somebody who knows what they're talking about and then plug in your sales reps and you can still hire somebody that's mature enough to take over the leadership role down the track, but you don't need to get them to spend six months setting everything up and paying them good dollars for that.

[00:54:09] Sean: And some people want to reach out for help, because again, it depends on the nature of the Founder, but there's no reason that with a bit of investment in your own learning and thinking, reading books, like Peter’s, talking to people, thinking about, listening to your competitors calls, taking these principles on and going, okay. I can actually optimise my own sales process. And once I know that it's working, then seek to replicate it. If you think about the one set of metrics that you really can't afford to just hope somebody else is going to pick up. It's sales because you run out of revenue, everything else is academic.

[00:54:42] That doesn't mean anything else is less important, but if you're not taking care of the sales, the other stuff becomes academic. And you're not going to be able to manage the costs. Peter, I'm conscious of how much time we've got left, and when it was starting to run a little short, I would love to get your thoughts on, we had a little bit of a chat offline about this around metrics.

[00:55:02] Fundamentally as when you're growing out a sales function, some people get absolutely bamboozled by the significant number of things that you can measure and can end up trying to really measure and focus on everything. And some people probably measure far too little and actually don't really have a good sense or a pulse of what's going on in their sales function, which again, you know, is fundamentally driving the revenue engine of the business.

[00:55:27] How do you think about sort of legal lag indicators are important for a Founder to focus on, if there was only a few, how would you guide someone to think about how they set up their sales and marketing reporting?  

[00:55:41] Peter: Yeah. So, I still would have some of the traditional metrics. So, revenue pipeline, maybe even coverage. So coverage is, if we need to make a hundred thousand dollars and we win every third deal, we should actually have 300,000 worth of deals in the pipeline so we can be sure that we get the a hundred thousand dollars, that's coverage, but all that's just measuring what we want to achieve. I really think that modern selling needs to include a customer metric as well.

[00:56:18] And I ideally like to use something like an engagement quality matric. So, somebody say, how happy is the customer with their buying experience? And by the way, I'm not just talking about NPS - Net Promoter Score because we're all tired of giving a rating out of 10, and would you recommend us to your mates? That that's kind of not really that useful anymore. But if we can just get informal feedback or we ask an open question, like, what could we do better? What should we do more off? What should we stop doing? Then we can gauge the true response from the customer.

[00:57:07] The customer can talk about what they want to talk about, not what we want to measure. So, have all the traditional metrics, but have a customer metric in there as well, because you get gold back from the customer if you only ask the right question and an open-ended question, it's better than a closed question.

[00:57:23] So if you say, if you don't say, do you like us? Yes or no, you get a yes or no answer, but you still don't know why. Whereas if you say, what should we do more off? Then they go, oh, well your competition does this and you don't do it and I really like what they do, so why don't you do the same thing? And you go, oh my God, never even knew that they do that. So, you get Intel from the customer directly as well. So, it makes a lot of sense.  

[00:57:49] Sean: Yeah, absolutely. I agree. You know, actually one of the things I think that's quite often missing is, we talked about that gap of, if you've got a typical 10% conversion rate and therefore 90% aren't buying, my first question is where are we at?

[00:58:03] Where is the analysis on the 90%? Now that might be a series of metrics. That might be a post call survey on the IVR on the telephone system. It might be a post-call survey via e-mail. It could be a post-call survey via text message, but it should be also be followed up with qualitative survey.

[00:58:18] Someone needs to be asking these customers real questions about what their experience was in the process. And I don't think there's anything much more valuable given you've already spent money on engaging with that person in a way, or they've spent effort on, they've had enough interest to give you an email address or to come to a website or something.

[00:58:36] Something's not lining up, either it's too early, you don't have this, you don't have that. They don't need this, there's something happening where you've already spent that money. But to the extent that we don't focus on what we're missing and we're not thinking about them, what their experience was all the way through that process, we’re missing major important information that without spending any more money to your earlier point on leads, we can actually get better quality leads because we're figuring out the things that we're missing.

[00:59:01] And otherwise we're just sort of guessing, we're just focused on the ones that say yes, not the ones that the don’t say yes yet.  

[00:59:07] Peter: There's one really other important thing about that and that anytime you ask your customer for feedback, it must not just go, oh, thanks Sean. And never be heard from again, it's important that you go back to the customer, say, thank you for giving us that feedback. Here's what we're doing about it. Or even if you're not doing anything, but here's why we're not doing anything.

[00:59:38] Because by the time you asked the customer two or three times about their feedback, and then they hear nothing back from you, they're going to go, why am I still doing this? There's nothing in it for me. Whereas, if you make them feel like the feedback has actually contributed to a change in the organisation to improve the service experience or whatever, they'll go, okay, these guys are listening to me. And don't forget, we want that same customer to come back and buy more from us and we want them to advocate new business to us. So, we better give them a good experience and be better help them to help us giving them that better experience.  

[01:00:10] Sean: Absolutely. Yeah. I love that. You know, I remember one of the most positive experiences I've ever had with a major supplier who we used to spend a lot of money with, which was actually Adobe. And they used to invite us to a quarterly meeting where they would present to us what they thought their product roadmap was going to be based on what their customers were telling them. And I would use us as a sounding board and they'd say, what do you think of this? What are we missing?

[01:00:31] What aren't we doing? What aren't we thinking about? And I just thought, and you would then see the next quarter was the first time you got. Well, let's see if they care about what we say and the next quarter, you'd figure out to your point. Did they actually replay that back to you? This is what we heard last time.

[01:00:43] This is what we've done about it. This is what how it's turning out and you're going, wow. They actually listen. I'm going to come to this every time and I'm going to give them more feedback because I'm now part of this process. It does make you feel special, but it does indeed.

[01:00:56] And I just think, your customers have the answers. They're the ones who had the engagement with you. They know what it is that they want. We're just not usually very good at asking those questions and then finding a way to interpret it. Yeah, indeed. Indeed. I can talk to you all day long. But unfortunately, I don't get to do that today. So, I just would really like to acknowledge you for the way that you're approaching teaching people about sales, because I think it's far too easy when people are looking for answers around sales. I know of a business recently that bought a, I think it was, they bought the Wolf of wall street book and they basically had all their sales reps read it.

[01:01:38] And they’re like, this is how I want you to sell. And everyone was going, what, what, what, what are you talking about? Like, so against the ethics and the culture of that business, but my point is, it's very easy for people to come at sales from the wrong philosophy, and actually not from a point of integrity, which is really to your point about how do I serve this customer? Is this a customer I can serve? How do I serve them and how do I serve them better so that I can make a good decision for themselves, whether that's me or it's somebody else doesn't, you know, yes, I'd like it to be me more often, but actually I've got to figure out, do I have a good value proposition?

[01:02:12] And then can I create a space where they get to give me the information I need. I can give them some information to chew on that makes sense. And then I get to choose at the end. So I really appreciate the way that you are bringing that to the market, to all of your clients. So, thank you very much for sharing some of your knowledge with all of our community today.

[01:02:29] I'm aware that you also have a diagnostic tool that people can tap into. You just want to share it with that community what that is?

[01:02:40] G’day everybody, Sean Steele here, your host, just filling in for the little glitch that we had on Peter's side. What Peter wanted you to know is that he's actually made available to you a free assessment that helps you understand how buyer focused your sales funnel is, which is one of the things we've been talking about in today's episode. The web address for that is www.Peterstrohkorb.com/sales-assessment where you can just go to free resources through the link on his website, and you will find it there. Wonderful. Thank you so much, Peter. And for people to get in touch with the you, they can use that web address to be able to follow along, I assume you’re also on LinkedIn.

[01:03:25] And if people want to reach out and connect. If you've got any questions, folks you can, of course also go to the www.scaleuppodcast.com, a website, we've got a speak pipe button on the right hand side. You can leave us an audio message, which we can get through to Peter. Or if you have questions, of course, at any time about scaling your business, that you'd like myself or myself with a guest to handle in the future, please feel free to send those through.

[01:03:45] I hope you've enjoyed the show today. A huge thanks to Peter Strohkorb. And a couple of things before you go, if you got value from the things that Peter had to say today, and I guarantee if you take a step back and look at your sales process and listen to what your salespeople are saying, or take a step back, even record one of your own conversations appropriately and listen back to it and ask them, are you actually focused on the outcome or are you focused on the thing? That alone can absolutely change the game in the quality of the conversations that you're having with potential prospects. And if you think about where the time is going in to your business, that's usually a big amount of time and a big amount of money.

[01:04:19] So, if you got value from what you heard today, please jump on Apple Podcasts, leave us a review. We all get a huge kick out of that helps other people find it. You can find us on www.Scaleupspodcast.com. You can leave your email there. We can let you know when new episodes or downloads and tools are coming out, or you can find us on the socials @scaleupspodcast on pretty much every socials. But remember that the only thing that can actually prevent you from scaling up in full is giving up. So, it's going to get tough. You're going to fail, you are going to have sales results that every now and again, you'd have salespeople that you don't think are doing a great job, but you know what?

[01:04:54] It's going to get tough and you have to stay on board and you have to stay unshakable and you have faith and your conviction that you're going to get them. And you have to say flexibility in your approach. Thank you very much for joining us today. You've been listening to the ScaleUps Podcast. I'm Sean Steele, and we'll look forward to speaking to you again next week. Thanks so much, Peter.

[01:05:12] Sean: G’day everyone, just a couple of quick things before you go. If you have questions that you'd love myself or an upcoming guest to tackle about challenges that you're facing in scaling your business, please just jump straight on the website scaleupspodcast.com. You can record your message straight from the mobile by hitting the button on the right-hand side of the page, or you can just email them the old-fashioned way [email protected] and just a quick reminder, nothing we spoke about today constitutes financial business advice. If you are considering making big decisions in your business, seek out a professional who can look at your situation in detail and make sure you're getting sound personalised advice. Thanks for listening. Look forward to being back in your podcast feed next week.