Wednesday, November 16, 2016

Mark Twain, Sales Genius

Mark Twain once said: “It’s easier to fool people than to convince them that they have been fooled.”  I want to explore and discuss how that is important in today’s world of selling.  

Let me first give you an example that most of us in sales have experienced.  You meet a potential client and ask some questions and find out that this person has a product that they have bought for a significant amount of money. You know that this product (whatever it is) is an inferior piece of shit.  Naturally, you go about trying to convince this person that they have made a mistake and you have something that will work much better and the kicker is that it costs less.  Your expectation is that your prospect will see the value and jump on it immediately.  But, that doesn’t happen, does it?  Why?


The answer is Cognitive Dissonance.  Mark Twain lived from 1835 to 1910.  Cognitive Dissonance theory was not proposed until 1957 by Psychology Professor Leon Festinger.  Cognitive dissonance is the discomfort we feel over the turmoil in our brains that is caused by conflicting beliefs, ideas or values.  Our brains work hard to make us think we are doing the right thing, even though there may be overwhelming evidence telling us otherwise. Consistency of belief tends to be more comfortable than the feeling of having made a mistake.

Rationale.  Many times, very smart people will justify their dumb choices.  They use illogical reasons for buying or keeping their piece of shit, over priced product.  Here are a just a few.

-You get what you pay for.
-It could be much worse.
-It’s what my spouse wanted.
-We had some extra money laying around.
-It’s worked fine so far.
-My dad did business with this company.

So how do you snap someone out of this kind of “natural” behavior?  You leave all that sales presentation 101 bullshit behind.  I know you’ve heard “Knowing is half the battle.”  Well, i would say, it’s closer to 90% of the battle.  You have to know what your client is thinking or feeling and you have to get ahead of it for his or her own good.  You will never sell to someone who is net feeling at ease and someone who is experiencing cognitive dissonance is not at ease.  

How do you know what your client is feeling?  Empathy, if you don’t have it, you will learn it.  We have all made mistakes.  Some of us have made huge mistakes or have been wrong in a big way, only to discover a profound truth.  You must not be patronizing but sometimes you have to challenge those who can handle it.  Some know-it-alls find that hard to resist.  With others, you just have to be a sounding board.  Ask good questions and then shut up and listen.  People will talk themselves into buying from you if you allow it.  And then do right by your client and sell the best thing.  “Always do right. This will gratify some people and astonish the rest.”  -Mark Twain

-Insurance Professor

Monday, November 7, 2016

Insurance Buyers, Static or Metamorphic

My 10 year old son is in homeschool.  His best and favorite subject is Science (mine too).  He and my wife get to do all kinds of cool science classes and experiments.  I am not very involved in the lessons except when I overhear what they’re working on and feel compelled to interject with a very important theory of my own.  Typically, I find that my speculation is undervalued by the two of them.  

Earlier today, I heard the words, “Static” and “Metamorphic” in reference to earth science.  I thought about how these two words are perfect to describe people who buy stuff.  We have addressed the idea that consumers buy differently now than they did in the past, but I want to talk quickly about the rate of change.  

First off, the Insurance industry is very slow moving, kind of like a three toed sloth.  For decades, the same type of sales training has been used for these 2 reasons.  The products have been fairly consistent over long stretches of time and people have consistently fallen for the same sales pitches.

But, there has been a change.  Did people get smarter all of a sudden?  No.  They did not.  They used an information gathering tool that became available.  It used to be that if you needed information on life insurance, you reached out to an agent.  If he gave you a queasy feeling and if you wanted a second opinion on life insurance, you reached out to another agent.  At some point though, you had to buy or you would have invested too much time shopping to justify the savings you may have achieved.  In other words, a person is only willing to dedicate a specific amount of time to learning about a particular good or service before deciding to buy it or not.

About, 15 years ago, people were still getting their first look at life insurance products through the agent but then seeking validation of their queasy feelings through the internet.  Even when internet speeds were that slow, you could now figure out that you were being pitched something that sucked… and you didn’t have to burn time getting in front of another agent.

Fast forward to today.  In just 15 short years, the captive/career agent system for life insurance is crumbling.  Career agents are being laid off because consumers are too well informed to buy from them.  Even those who still work for life insurance companies are often allowed to sell other companies’ products because if they do not, the consumer will just buy the best priced product somewhere else.  The carriers are being forced to innovate.  They are finally using online applications and are closing offices because no one walks in any more.

Neck ties are being sent to GoodWill for greatly overestimated tax deduction values.  The best, most talented agents of today are independent.  They are smarter about the industry and product, yet much more casual.  They address the need and help the client buy the right thing instead of selling the merit of a one size fits all product.  I think i may have been one of the very first life insurance salesman to abandon slacks for jeans.  

The flow of information in the last 15 years has made a metamorphic change, which has been the catalyst for changes in the whole industry.  The need for life insurance has remained static.  And this may surprise you but the client has really only made a minor change in the way he or she buys.  

In general, people want the same thing they always wanted.  They want to take care of their families.  They want to understand what they are buying.  They want to buy it at the right price.  And all things being equal, they prefer to buy from a person.  But, old methods of selling will feel more and more uncomfortable to the client.  I believe those methods will eventually be abandoned by the industry.

Tuesday, November 1, 2016

No For Now, And No Forever!

If you are in sales, you have heard “No” many times over.  There have been hundreds of sales training programs that are focused on dealing with rejection.  Many of these are based on clarifying what “no” actually means to the client and then focusing on solving that issue.  Here are just a few of the reasons for hearing “no.”

  1. I don’t understand.
  2. I am not the decision maker.
  3. Now is not a good time.
  4. Your price is too high.
  5. You don’t have what I need.
  6. I don’t trust you.

So, I am definitely a proponent of digging deeper to make sure that the client is getting the best experience, price and product.  And I agree that when your client tells you “no,” it is possible to turn that into an eventual “yes.”  But what I don’t get is why anyone would accept the idea that they should hear “no” so often.  If you hear “no” for any of the reasons above, it’s because you screwed up somewhere.  Most of the time it is because you talked too much, your prospect talked too little and you have no understanding of what motivates this person to buy.  If you are friendly and likeable, the result of this is probably “No for Now.”

Why so much “no”?  Because sales training is too focused on the product.  If sales is focused on the client, and you are a good salesman, you can understand your client so well that you may never hear the word “no.”  Don’t believe me?  I can’t even remember the last time I got a “no” in a client meeting.  I strive to understand the client to the extent that I will not even ask them to buy if I know I cannot help them in a significant way.  I typically don’t have ask them to buy at all because my clients and I are on the same team and we are pursuing the solution together.  To be fair, I hear “no” enough at home from my wife that I have strived to eliminate the word from my work day.  Thank you honey, you have made me the man I am today.

What about “No Forever?”  Most salespeople do not know when “no forever” has happened to them or why.  Here are a few reasons for “no forever.”

  1. You pushed a product that made no sense or the price was too high and the client found something much better somewhere else.
  2. You were rude or crass.
  3. You got a bad review from a former client.
  4. You didn’t do what you said you would do.
  5. You smell, ask dumb questions, sound like an idiot.
  6. You oversell.

The main reason for a “no forever” is when the client has a profoundly great buying experience with someone else.  You will never get that client back.

You want to be (You Have To Be) the guy or gal who is the best at selling and who has the best product to sell.  Then you’ll have to get all your “no's” at home, like me.

-Insurance Professor