Student of Sales

My take on Spin Selling (part 1 of 8)

July 4, 2007 · 1 Comment

Spin Selling

by: Neil Rackham

Neil Rackham is a best selling author. You can read more about him at his website linked to his name.

Mr. Rackham prefaces this book with two statements.

Preface:

  1. It’s about the larger sale.
  2. It’s based on research.

Sales Behavior and Sales Success

Successful Salespeople are…

  • Not better closers
  • Not better at handling objections
  • Not better at using open ended questions

Many beleive the 3 key components to a sales pitch are:

  1. Uncover needs with open and closed questions.
  2. Overcome objections.
  3. Close for the business.

Huthwaite (Rackham’s research company) found through 10 yrs of research that the methods listed above are:

  • Good for low-value sales

According to Rackham,

Top salespeople are using a

POWERFUL PROBING INVESTIGATION STRATEGY

to achieve their success.

Success in the Larger Sale

Traditional (not necessarily effective) steps of a sales call are:

  1. Opening the call~Relate to the buyer (not necessarily effective in the large sale.
  2. Investigating needs
  3. Giving benefits
  4. Objection handling
  5. Closing techniques

Again, these may be o.k. for a small sale. A small sale for these purposes are one that is relatively low-value and can be closed in one call.

The Major Sale

You know a major sale from a minor one.

Now, consider the psychology…

  • The customer perception changes.
  • Customer behavior changes.
  • Selling cycle is longer:
    • Most of the “talk” about your presentation is done internal.
    • Or…not by you.
    • Consider these questions:
      1. How much of what I’ve said will the customer remember tomorrow after I’ve gone
      2. Could the customer repeat my smoothly polished presentation to her boss?
  • Size of customer commitment is bigger:
    • The building of value is probably the single most important selling skill in larger sales.
  • The on-going relationship
    • It is harder to seperate product from seller in larger sales. The customer has to decide whether or not they want to enter a relationship with the salesperson.
  • The risk of mistakes
    • Larger decisions are much more public and a bad decision is much more visible.

The 4 Stages of a Sales Call

Every sales call goes through these 4 stages.

  1. Preliminaries

    • Introduce yourself
    • How you begin conversation
    • These are less important in large sales.

  2. Investigating

    • Very important
    • Crucial in large sales
    • In fact, the most important selling skill.

  3. Demonstrating Capability

    • You must show customers that
      • You have a solution
      • That it makes sense to do business with you

  4. Obtaining Commitment

    • The key here is called ADVANCES in larger sales.

The balance of these four stages will depend on:

  • The type of call
  • The calls purpose
  • Where the call comes in the sales cycle
So, which stage is most important?

The answer depends on the size of the sale.

Questions and Success

In studies of

  • NEGOTIATION
  • MANAGEMENT INTERACTION
  • PERFORMANCE INTERVIEWS
  • GROUP DISCUSSIONS

More Questions = More Interaction

Focus: Open vs. Closed

  • Closed: Answered in single word, Sometimes called directive probe
  • Open: Require longer answer, non-directive probe

Points about Open and Closed Questions generally made by writers over the last 60 years:

  • Open Questions are more powerful and often reveal unexpected information.
  • Closed Questions are less powerful and can be used with “talkative” customers.
  • Closed Questions can be used when little time is available.
  • Open Questions are particualarly important in larger sales, Closed Questions can be successful in small sales.
  • General goal of sales training should be to help people ask more Open Questions.

Huthwaite found that these points are not necessarily true. There has been no scientific research on their truth. Even still corporations around the world are spending billions of dollars training salespeople with these assumptions held as truth.

A New Direction

Huthwaite found that questions in the successul call tend to fall into a sequence they call SPIN.

  1. Situation Questions. ~ Data-gathering questions about facts and background not to be over used.
  2. Problem Questions. ~ Explore problems difficulties, and dissatisfactions in areas where the seller’s product can help. Inexperienced sellers generally don’t ask enough.
  3. Implication Questions. ~ Take a problem question and explore it’s effects or consequences. Very important.
  4. Need-payoff Questions. ~ Get the customer to tell you the benefits that your solution could offer.
The SPIN Model

This is not a rigid sequence. However it is generally true that Situation Questions are asked early in the call and all other types of questions follow.

Remember- The work you’ve just read is Neil Rackham’s. I have simply outlined his book. Most of the words above are his own. At times I paraphrased.

Until next time…

Keith Porterfield

a Student of Sales

Categories: I am Stud-y · Outlines