David Clayton wrote an article on Seedcamp recently, See this original post here.
Up until now you’ve been focused on impressing investors – and you’ve done something right because you’ve raised funds for your business. It would be tempting to assume that a version of the pitch that got investors excited will work for customers – bad idea.
The pitch and positioning that helped you raise funds, showed somebody inherently comfortable with risk that you were worth a punt. A customer buys something because they need or want it. They’re not taking a bet and they’re not comfortable with risk.
Think about the things that play into the buying decision for you. After all, you’ve bought an awful lot of stuff in your lifetime. Ever bought something of real personal value, like an engagement ring? Or something really expensive, like a house? How did you feel just before you said yes and paid for the ring or signed the documents for your new home?
If you’re like most buyers, the closer you got to signing on the dotted line the more important your risk became. Not “Will it solve my problem?” – if you’re this far along you’re happy with that. Not “Can I get it or something similar cheaper?” – if you’re this far along you’re also comfortable enough with the price (even if it feels expensive). Your prime thought and/or feeling is, “What could go wrong?”
From the prospect’s point-of-view
So put yourselves in the shoes of your prospect – the person at Deep Pockets Inc. you’re pitching to – who is seeing you because you’re supposedly disrupting ‘blah blah blah’.
Let’s assume you’ve got across the first couple of hurdles; the prospect thinks you know your stuff, that your product or service will fit with their strategy and it will deliver on their objective (you’re doing better than most to get this far).
As the prospect gets closer to short-listing or buying from you, all they will be thinking and/or feeling is risk…
What will this mean for my workload?
Sally Burtt-Jones, associate at True&North, often talks in our workshops about how many prospects just want to get home for EastEnders. That is pretty apt in many cases. So it is on you to identify if you’re dealing with this kind of person or someone more ambitious who is all about the job.
We’ve never bought from these guys before. Even if sticking with Big Silly Inc. is more expensive and the solution is less of a fit, no one here ever got fired for buying from Big Silly Inc.
This is different and new… If I do what I did last year I know what I’m safe.
What will my boss say if this is difficult / doesn’t work as planned? How will it look to my colleagues?
If we implement this, James in IT will have to approve it and lead on it, I don’t like James and that will be painful for me.
Really empathise; really put yourself in the prospect’s shoes. Are you telling me there is stuff you want to buy but haven’t because it will cause friction with your husband / wife / BF / GF? Of course – it plays out just the same between all humans who need consensus on a decision and implementation.
“They’re a small company, will they still be around next week?”
As a startup you are inherently a risky propositions, so address this issue head on.
“These guys were 10 minutes late, will they really deliver”
Sad to say that many startups I’ve come across seem to forget basic rules of business, like be on time.
“Does the potential upside warrant me putting my neck on the line?”
The question that sums it all up, Is it worth the bother?
What to do about it
“God grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the difference.” Reinhold Niebuhr
You know that risk is a concern for anyone buying anything of value. You know that as a new company a prospect will perceive you as more risky than incumbents – so be courageous and tackle risk head on.
Assertively control the conversation around perceived weaknesses, to prevent objections through preparation rather than be on the back foot responding to objections, or worse just leaving it all unsaid.
With your product you no doubt iterate based on user behaviour; a sales pitch is just the same. You pitch, some things work, some things don’t. Learn from the last pitch and reiterate. If an objection came up last time, build a response into your pitch that will reassure your prospect.
If you are going to meetings and having “nice” conversations and people would like “the information” and will be “in touch”, the only person you are kidding is yourself.
Charlie Wilkie, SVP Sponsorship at The Guardian, talks about asking the uncomfortable questions. If all the questions in your last sales pitch were easy to ask chances are you’re not doing your job.
The only way you will consistently complete the sale is to continue working hard after the prospect has said your product is interesting and could be a good fit. This is the point many sales interactions end. The sales person is so happy to have heard the good news, they stop just when they should be getting started.
Here are 3 simple steps to take a prospect through at this stage:
- Agree their Buying Method: The people, process and criteria involved
- Uncover Risks and Agree ways to mitigate with the prospect
- Agree a joint plan to close, deliver & measure
If that’s too much to remember just empathise with your prospect. Go back to when you bought your home, engagement ring or equivalent. The risk you felt just before the purchase didn’t go away when you completed the purchase, it carried on until your proposal was accepted or you moved in to your new house and evaluated your choices.
Ultimately a good sale requires informed, confident buyers and it is on you to create them.