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Marketing Personal Development

What Every Business Author Needs to Know

For most business authors, the days of making a living on writing business books are long gone.

But a new era is here, and it still pays to keep publishing them.

Let me explain.

Over 70% of books don’t turn a profit on book sales alone anymore.

Just like selling music, the margins in individual book sales have become so low and finite that it isn’t a lucrative revenue model. Business books have become a marketing model.

The real ROI

The going rate for ghostwriting is around $7,000 per 50 pages, at 250 words a page. For a standard 250 page book, that’s $35,000.

$140 per page or $.56 per word! And That doesn’t cover the cost of marketing and inventory.

So, If you don’t have a marketing plan that will sell enough books to off-set those costs, you better be using them to promote the service that will.

Most authors and publishers are still marketing books like it’s the golden era of publishing in the 1980s. Business authors should use books as marketing tools and not rely on them for revenue only.

Every business author makes the lion share of their total revenue on their services:  consulting, speaking, training, etc. Yet, most authors promote their books as a separate sales and marketing process.

Separate marketing plan, separate sales funnel, separate audience. Instead, Business authors should use their books to promote their subject matter expertise in tandem with the service they make their living on.

The Reality:

Books are an increasingly low margin product.

Just think, you would have to sell 20,000 books to bring in the same revenue of a $20,000-month consulting retainer.

HERE IS THE SECRET that nobody wants to talk about.

YOU DON’T HAVE to make a killing on book sales to make a killing off of your book.

Mass marketing is over. Ultimately, you’re selling a niche service, not a book.

Don’t believe me?

Only 62 out of 1000 book titles sell more than 5,000 copies, so you can’t publish thinking book sales are the pot of gold.

Books are the rainbow that leads interested people to the pot of gold by ultimately purchasing the service you provide after proving you’re the leader in your domain of expertise.

For example;

REAL LIFE CASE STUDIES

Russel Brunson. ClickFunnels

I met Russel Brunson in 2008 at a mastermind event teaching internet marketing. Then around 2015, Brunson launched a book called DOTCOM Secrets to teach people how to be effective at digital marketing.

But he wasn’t selling his book!  He gave it away at cost. He still is (get it here). Why? Because he isn’t in the business of selling books. He is playing a bigger game.

So what is he really selling?

He’s the founder of a SaaS software for internet marketers called ClickFunnels.

He gives away his book at cost as a marketing strategy attracting as many people as possible who are interested in digital marketing to upsell them on his digital marketing software to implement what they want. Results.

By using his book as a marketing tool, he attracted a social media tribe of over 1 million entrepreneurs who do their own digital marketing.

He then upsold no less than 55,000 current active users to his SaaS software. His ClickFunnels Software company is now valued at over $360 million in top-line revenue.

Brunson’s personal net worth is $37 million today. By not worrying about making money on book sales but using his books to attract and teach an audience how to effectively use his software!

Grant Cardone. 10x

Cardone deployed the same model using his book to attract people searching for personal development and sales mastery.

When you sign up to get his free book, he upsells them into his Grant Cardone Sales Training University at a price tag of $10k per student.

His personal net worth is $300 million. While historically he made his money through real estate investing, today he is using his books to attract people into his business sales funnel.

John Lee Dumas:

Dumas promotes content to people searching for how to start a podcast.

He then offers them a $3.99 book to teach people how to launch and grow a podcast that comes with 15 video tutorials. That’s a lot of upfront value for next to nothing.

Why? To upsells his podcast training program. By using his book as a lead magnet, he netted $2 million for his sales training business in his second year in operations.

SUMMARY

If you’re in the services business. Writing and publishing a book can be the perfect way to attract the customers interested in your field and expertise.

By teaching them what you know, they gain your trust, and you become the person they refer others to for help when they need your services.

While there is little chance you will retire on book royalties any more, there is a very big incentive to launch one for your business.

For more information visit tylerhayzlett.com

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Best Practices Investing Management Marketing Personal Development Sales

How’s Your Customer Focus Journey Going?

 

Woman holiday journey travel relaxation

If you don’t know what “being customer-focused” means or can’t measure it, you can’t know if you’re doing it.  Many company leaders desire customer focus. Fewer know exactly what that term means. Fewer still can describe specific behaviors to know how far they’ve progressed on a journey toward customer focus. Let’s fix that in this article.

The term “customer focus” is too vague to measure accurately.  Let’s correct our target term to customer-perceived value.  Perceived value is what drives customer decisions. Perceived isn’t just a throwaway word: value only exists in the customer’s mind, and elite organizations don’t take chances with what is/isn’t perceived by a prospect.  Thus, customer-perceived value (I often shorten it to just “value” because there isn’t any other kind) is the core idea — the essence — within the cruder “customer focus”.  Value is the axis around which everything in your organization should move.

Your first task in grading your company’s “customer focus” is to use a measurable target.

Refine your focus to “customer value”.

Value is the desirability of customer outcomes. Customers buy outcomes, not our products and services. What they are willing to pay – value — depends on the desirability of those outcomes. Desirability can be measured in dollars.

As you focus on value, your journey takes place in three domains, described below.

For starters, let’s grade your performance using three levels beyond “average”: Good, Great, and Elite. I’ll be detailing what Good, Great, and Elite look like in three upcoming articles, one for each domain.  If you can’t wait, contact me, because those articles are already (mostly) written.  I’m also developing an assessment tool, which will be on my new website (a shameless tease for coming attractions).

Below, I want to describe the three domains:

1. How well is your organization aligned around Value

Alignment between departments amounts to de-siloing your organization.  I’m all for developing robust expertise in many specialties, but it is an established anthropological fact that silos also create gaps for important stuff to fall through. There is a constant push-pull between specialization and holistic/systems thinking in any organization.  Alignment is the process of purposeful coordination between silos.

Companies usually start by aligning islands of functions…say, sales and marketing…then maybe customer service.  In elite value focus (aka Radical Value focus, the title of my upcoming book) everyone wants to uncover new/better customer outcomes to increase value.

Customer experience (aka CX) management follows a similar track.  Radical not only means everyone delivers value but is constantly seeking additional customer’s -mind insights

2. How Well Do Your People Build, Sell and Price customer value?

This is the domain of customer engagement.  As you progress from “good at sales” to “elite value-based seller”, the skills deepen, and the number of people in the organization participating widens.  I use three key components of the selling process to describe value-based selling:

  • Build: Uncovering and discovering value gaps, expanding them, and causing the customer to envision outcomes of having those gaps resolved.
  • Sell: Aligning the seller’s solution with desired customer outcomes.
  • Price: Facilitating the customer process of monetarily measuring the desirability of outcomes, then conducting a win-win pricing dialogue.

Elite performers, those who have radical focus, are able to execute sales at more profitable value-based pricing.

How Well Do You Enable Everyone in the Organization to Perform at an Elite Level?

Enablement consists of hiring, training, coaching, and content services.  Maturity level increases with the number of services, who is included, and breadth/depth of service. More importantly, maturity increases with transitioning from event focus, to process-focused, to closed-loop process.

  1. Event might mean train and coast, or coaching “burst”, then coast.
  2. Process looks like ongoing training; developing a coaching cadence.
  3. Loops close when coaching drives changed training when sales insights are captured for improved content and product innovation.  The more loops closed, the more elite.

One way the journey starts is when a company realizes that front line sales managers performing as “super salespeople” or “deal saviors” doesn’t scale — or build bench strength — nearly as well as coaching everyone to save their own deals. Another key indicator of maturity is the organization’s discounting process and behavior, from subjective/”squeaky wheel” management to objective, value-focused and tracked/analyzed

Research Backs This Up.

CSO Insights (CSOi) has defined 12 behaviors of great companies (their term: “world-class”). “Great” organizations practice all 12.   I’ve organized the 12 behaviors into these three domains.   (Source: CSO Insights’ 2019 Sales Best Practices Study)

The difference between CSOi’s results and the elite behaviors I’ll be sharing in coming articles: CSOi never even asked about elite behaviors, and thus never correlated elite behaviors to results.  The CSOi 12 behaviors figure prominently in the good and great levels of value focus, but are largely absent from the elite level.

  • Do you want to win more opportunities than most? CSOi’s results show that practicing these 12 behaviors correlates strongly to that type of outcome.
  • Do you want to win with higher customer preference?  CSOi didn’t ask; their results are silent here. It neither corroborates nor refutes that higher perceived value correlates with higher preference.  Other research (and common sense) will back this up, though.
  • How about winning with higher value, driving deeper customer relationships? CSOi didn’t ask.  Other research declares this a worthy pursuit, however.
  • Selling at higher win-win prices?  CSOi didn’t ask. There’s a sad story, here. Ask me about it sometime.

I Want More for You.  Radically Elite Value Focus.

These are the three domains for a journey to elite value focus.  In follow-on articles, I describe what makes up good, great, and elite performers.

Comment below, like, and/or share. As I said, reach out if you have more in-depth questions, or read the next three articles.

To your success!

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Best Practices Entrepreneurship Investing Management Marketing Personal Development Sales

Using Value Networks to Grow Your Business

 

The craft of sales is one of increasing the overlap between what outcomes a customer desires for themselves, and what outcomes the seller’s offer can deliver.

Increasing that overlap requires the seller to:

  1. Conduct insightful discovery into the customer’s business and personal situation to increase the range of desired outcomes.
  2. Identifying an exhaustive list of seller’s capabilities, then translating those into customer business outcomes.
  3. Articulate unmet value gaps to product/service innovators, who develop high-impact differentiation.

Most commercially available sales training addresses the first item. Almost all leave the second item up to an internal product training function. By “leaving it to the product trainer”, I mean ignore completely. No good framework to fill this gap has been introduced.

Introducing the Value Network.

The Value Network is a great tool.  It:

  • Captures deal-winning gold from top sellers for use by the whole team
  • Helps everyone in B2B sales teams sell more widely and deeply
  • Ramps new sellers up more rapidly
  • Guides more impactful executive conversations
  • Shapes more impactful marketing
  • Informs superior new product idea generation
  • Helps non-sales, but still customer-facing roles uncover new value.
  • Serves as a central point of truth for competitive positioning.
  • It is easy to learn and intuitive to use.

…so why don’t you know what a Value Network is?

A value network diagrams all of the possible customer outcomes your differentiation can drive for a customer. The diagram at the top of this article is a partial value network: it illustrates the client outcomes from adopting the kind of value-focused culture I propose in my upcoming book, Radical Value.

Building A Value Network

Start by describing an area of differentiation. In the example above, I promote building a company culture focused on value to the customer (yes this is different from many organizations, surprisingly.  Companies focus their cultures on lots of other things when value is what they should use as the hub around which everything else rotates).

From that differentiation (drawn above in a rectangle), describe all of the customer outcomes that result…and the outcomes those outcomes deliver, and so on. Draw those customer outcomes in ovals with arrows representing cause/effect (you’ll notice a few bidirectional arrows on this diagram, which shows mutual reinforcement loops) The resulting network represents all of the potential value your differentiation could deliver to a customer.

In the current vernacular, these might be called themes for value messages.  That is, they could be likely hypotheses that one could deliver to a prospect (or use as a justification for a meeting) – but then validate through dialogue.

For this article, I’ve outlined in blue where the use of a value network fits in a value-focused culture.  It enables or drives more insightful business discussions: by not just salespeople, but every person who comes in contact with your customer.  It clarifies innovation in business cases. It

Next Step:  Make Each Outcome Personal.

To keep the diagram above clean, I didn’t perform this step, but here’s what to do next.  Next to each oval, list the customer personas most likely to desire that outcome.  Here’s an example in closeup from a different value network:

Notice that Facilities is likely to find value in both of these outcomes, but affected department managers are only likely to care about one of the two.  This targeting analysis guides meeting plans, sales conversations, account-based marketing content, product innovation, and more. It also helps guide executive selling efforts by identifying executive-worthy conversations.

Making the Complex Simple

Building customer-perceived value is the selling behavior that most affects customer buying decisions.  Value is defined as the desirability of customer outcomes and is built off of differentiation. A Value Network is a tool that articulates all of the possible business outcomes your offer could produce for a customer.

Depending on what it is your company sells (product, service or solution), being able to efficiently identify all customer impacts is where the great sales conversation training (the one you’ve probably already invested in) begins. In my work with hundreds of B2B companies, I can confidently tell you that there is room for improvement in refining your “product” (which includes service) training. Value Networks can help everyone involved craft a simple set of training, content, and other materials guaranteed to improve the quality of your customer conversations, supporting higher win rates at more mutually-beneficial prices.

Here’s An Exercise For You to Apply This Article

The diagram at the top of this article was purposely left incomplete. Extend it using the bullet point statements under the section titled “Introducing the Value Network” plus any others you can think of. Now, study the bigger Value Network and consider what each of these outcomes means to you in your role: both professionally and personally. What would developing a company-wide focus on customer value do for you and your organization?

Comment below, or contact me if you’d like to learn more about this simple, powerful tool.  Or get on the waiting list for my upcoming book, where I’ll go into even more detail on how-to and use of Value Networks.

To Your Success!

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Entrepreneurship Marketing Personal Development

How Popular Thought Leaders Attract Followers Through Their Stories

Being a thought leader is no walk in the park. Staying in demand is even harder. I’ve seen a lot of speakers and subject matter experts come and go over the last decade. The ones that became the most successful the longest, know how to tell stories people need to hear.

Most executives get into the speaking circuit because they know solutions others would benefit from but they have a hard time getting people to listen. Especially early on. Everyone talks about the importance of having a digital presence and digital marketing but how do you grow an audience from scratch?

The first thing to know about creating traffic is that you’re not creating it. Your job is to convert it. The internet is traffic. It’s already there waiting for you.

Brands and companies winning with digital marketing are producing the most helpful and unique content by sharing their expertise on their subject matter in a way that relates to the people seeking something new and different.

Content marketing isn’t new it’s been “a thing” for thousands of years. The term “content marketing” was adopted in 2007 though to highlight the shift away from traditional interruption-based advertising to the maturing discipline of value-oriented content creation. It was a reminder and call to arms to stay grounded in the way humans communicate.

By telling stories and sharing experiences people can relate to.

Gary Vaynerchuck is one of the most in-demand corporate speakers today on digital marketing. But people don’t follow him because he talks about digital marketing. They follow him because they first related to his story and experience is something they want to replicate for themselves.

Gary grew his parents’ wine business from $3 million to $60 million by being one of the first companies to use YouTube to make wine video reviews to sell their inventory. He left that world and grew an 800 personal digital marketing agency for the world’s biggest brands. He isn’t just talking about digital marketing he lives and breathes it.

Similarly, Simon Sinek didn’t blow up for telling companies to update their mission statements. He shared his experience of how he quit his corporate job because he felt a lack of excitement and of attention to basic human emotional needs at large companies in a TedTalk that became the 3rd most popular watched presentation of all time.

Sinek explains complex obvious problems by sharing stories that create shared experiences.

Over the last 8 years our Chairman, Jeffrey Hayzlett, has delivered over 1,300 keynote presentations by outlining in vivid detail, how he and his team went through one of the largest gut-wrenching turnarounds in American business history. Telling his experience validates what every other company in the world is feeling and going through. Unmitigated massive ongoing scary changing business landscapes and how to face the fear of the unknown.

By sharing experience, we spread knowledge.

The point is some of the most in-demand speakers and thought leaders are not just marketing themselves as speakers available for hire. Popular thought leaders today are the missing messages for change in increasingly outdating industries. Telling hard truths most aren’t willing to say.

The most effective way to share your message is to tell stories.

Marketing and soap operas:

The phrase soap opera came about in the mid-1930s because the sponsors of the earliest radio shows were soap manufacturers targeting housewives through daytime radio ads for woman.

Attention from the same advertisers then shifted in the 60s to TV programming for working moms. High drama shows involving betrayals, breakups, dark secrets, and intimate storylines were capturing the attention of the masses. It was in that shift where marketers learned the mainstream attraction and power of storytelling. They integrated their advertising where people were listening to stories.

Digital marketers today are now scrambling to become the story not just interrupt them.

The emergence of the soap opera sequence:

Marketers only have seconds to capture strangers’ attention.

They are doing so by getting people hooked on an idea. This isn’t about manipulation it’s about getting to the point of what really matters to them.

Digital marketers today have adapted a term known as the Soap Opera Sequence to structure their communication in story form intended to create drama, build suspense and anticipation, and ultimately entice people to take action.

Telling your story using the soap opera sequence

1. Set The Stage:

Start off with an eye-raising statistic or enticing question.

2. Backstory

What’s the dramatic pain point everyone knows in the industry but nobody is talking about that creates trust and allows the know you’re just like them?

3. Hitting the Wall

What reoccurring business problem stopped you from reaching your goal that your prospect can relate to?

4. The Epiphany

What epiphany did you have that solved the problem in a new way that others should know? The secret you learned that changed everything after you implemented it?

5. The Hidden Benefits

What unexpected benefits emerged as a result of the changes you implemented?

6. The Call to Action

Why act now versus later? What will it cost not to act right now?

When communicating with purpose to attract your tribe, use the soap opera sequence to make your content stand out by telling a story that your audience can relate to.

It isn’t about putting out content. It’s putting out content in a relevant and meaningful way.

There has always been too much content. The only way to stand out is to relevant and different. Tell your story like nobody else!

For more information visit tylerhayzlett.com

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Marketing Personal Development

WARNING All Authors a Lesson on Pricing Content From the Music Industry

Selling books and content is no walk in the park. And it’s about to get even harder.

To understand the changing landscape for authors. Here’s a parallel situation that’s already played out for music content publishers.

When Napster crashed the music party in 1999 giving away music for free, attracting the masses to one platform, one group quietly noticed and went to work. Advertisers copied the model and took over the music industry by controlling the distribution. Now the industry doesn’t care about making money selling music anymore. They give away music to sell other products. Killing revenue margins for musicians in the process.

 Now they’re playing a different game…

Today iTunes is the new version of the record store. Apple promotes extremely discounted music to sell Apple’s lucrative products. Music’s just the bait.

Think about it, how is it that Spotify and Pandora, whose sole business model is to make money from the streaming of music, DON’T ACTUALLY MAKE ANY MONEY selling music?

80% of Pandora’s net revenue comes from the ads playing to people listening to free music. Only 20% comes from users who pay for ad-free listening. In turn, Pandora pays musicians insultingly tiny royalties established in 2016 at $0.00176 on for each song played essentially as Pandora’s marketing expense.

In other words, THEY DON’T SELL CONTENT! They use it.

They pay to give away content for free in order to sell advertising. Pandora hasn’t turned a profit since it started in 2000.

Spotify after 13 years and 96 million subscribers, finally reported a profit for the first time this year of $107M and are spending all of it and more ($500M) to acquire podcast networks for the same reason.

So what in the heck does this have to do with authors?

Publishers of all types, from news to music, to movies, to books, are NOT HAPPY that consumers won’t pay a premium for content anymore. The painful lesson content-driven industries are learning is that they never sold content! They sold access to content and the price you paid was simply the package it came in.

From records, tapes, CDs, now to streaming. But that’s all changing. Even for authors.

Amazon is doing to authors what iTunes has been doing to musicians. They sell books as low-cost leaders to sell higher ticket items.

 Don’t believe me?

Why would anyone buy a book in a retail book store for $24.95 when you can get it for $1.19 with free shipping to your front door? Look for yourself. This is a book we spent the better part of three years to build and promote. Amazon took it upon themselves to reset prices without consulting us.

Amazon sells the book below the cost it takes to produce it! It’s only a matter of time Amazon arbitrates book pricing below the cost of producing the book.

 

We launched this book in December of 2018 and In the 6 months since the launch, Amazon priced it $8 below retail.

The current book pricing model is absurd!

The book industry is still pricing books based on the old physical distribution model to keep the past model alive and it isn’t working. Retail pricing is almost twice as high for the same product listed on Amazon, and it isn’t delivered to your front door with free shipping.

People are more likely to buy coffee from a bookstore at this point than an actual book.

The first day of your book launch the listing price is discounted from the retail price on Amazon from $25 down to $15-17 right out of the gate. Amazon resellers then start to immediately undercut the publisher’s listed prices.

Ever heard of Seth Godin? Here is Seth’s most recent book that should be $24 at retail. However, you can get the same book on Amazon for $6-$11 or $0 if you sign up for Amazon’s Audible trial!

Seriously? It’s the same content and product. I’m certainly not the first to notice this phenomenon. This guy noticed it first and started a business around it.

Meet Jeff Bezos. The man, the myth, the legend.

Like a phoenix rising from the ashes of closed book stores. Bezos started Amazon in 1996 to sell books online with $16 Million in sales (Barnes and Noble took in $2 Billion that year). Today Amazon controls half the print book marketplace while B&N has only 1/5th left

Amazon’s up to 84% for e-book market and B&N just 2%.

Amazon’s e-commerce is around $1Trillion in market cap while B&N is down to $475 Million. For context that’s .05% of what Amazon is doing in online sales.

Bezos cracked the code. The book pricing model is flawed but nobody seems to be talking about it. Books are still being sold at retail pricing when you can buy them under cost on Amazon. Authors today are required to do 100% of their sales and marketing making the retail price relevant for about 3 months before you go buy it from Jeff.

Something needs to change.

 

For more information visit tylerhayzlett.com

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Marketing Networking Personal Development Strategy

The Rise of Thought Leaders

Business is booming! The knowledge-based service industry is now a $355 million dollar per day business. $129 billion billed annually to subject matter experts, trainers, consultants, authors, coaches, speakers, masterminds, webinars, e-courses and more.

The good news is the demand for information and thought leaders is at an all-time high. The bad news? So is the increasing supply and it’s becoming difficult to stand out from the crowded room of other experts.

There’s a growing rate of increase in competition for subject matter experts.

Seriously, subject matter experts are everywhere. Based on a simple search on LinkedIn based on titles, there are:

  • 12 million authors
  • 6 million Experts
  • 550,000 Consultants
  • 300,000 Coaches
  • 300,000 Trainers
  • 40,000 Speakers

That’s a lot of competition!

Just think, if you started a retail business you would have just a handful of competitors in your space. In the knowledge field, it’s fair to say that competition is high.
But where are they all coming from? Why are there so many experts right now?

The rise of professional services & knowledge delivery:

Ever since the 1970s, the American economy moved from a manufacturing to a service-based economy. Today the service business in the US represents 80% of the US private-sector GDP at $10 Trillion annually. The professional service sector consists of agencies, consultants, and specialists championed by individual industry experts.

As the service businesses emerged the brand promise transferred from product quality to specialized knowledge expertise and skill. This led to the rise of individuals as brands.

The Brand Called You! You Can’t Move Up if You Don’t Stand Out!

In 1997, Fast Company recognized the necessity for individuals to develop individual personal brands to compete in the cut-throat digital economy. The key to getting ahead in the services market is directly linked to establishing your personal equivalent of the Nike swoosh. “It’s that simple, that hard, and that inescapable.” At least that’s how Tom Peters put it in this classic branding piece.

Fast forward to today. Because anyone can be positioned as an expert. Everyone is.

 

For more information visit tylerhayzlett.com

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Best Practices Investing Management Marketing Personal Development Sales

When Sales isn’t Paid on Profits — You Get What You Pay For

If your sales compensation plan fails to reward building value — and then pricing to it — you’ll get exactly what you ask from your salespeople. And all the bad things that come with it —especially if you’re a sales leader.  Let’s explore the implications.

While you’re reading this, you have salespeople working hard to win business that you don’t want. A lot of that is because of your incentive plan. When your people aren’t paid to increase deal profitability, many won’t bother. Sadly, this is the sales leader’s fault.  Salespeople may not be fully coin-operated, and they certainly aren’t bad or lazy…but they’re also not stupid. A comp plan that promises that you won’t push them to work any harder for a deal than they have to, they’ll win deals the easy way: by discounting.

The Obvious Outcome: Profits

We’ve all heard that “Nothing starts until a sale is made”. Curiously, nobody brings up that “Everything ends when sales aren’t profitable”. I just painfully watched this outcome at a formerly-great company.  What a shame.

For those who have never managed a P&L, let me make it simple.  Every top-line dollar discounted off a sale drops off the bottom line as well (there is no change in any of your cost lines).  Pricing dollars are profit dollars.

Think about it another way: in a price war, the only party who wins is the lowest-cost competitor (and no, customers don’t win. Very few of them actually want the low-cost option). If that lowest-cost provider isn’t you, stop playing a game that you can’t win.   That means stop compensating discounting dysfunction.

If you don’t reward pricing to value, you’ll get exactly the profitability you’re asking for.

The Next Outcome:  Affording Differentiation.

Customers choose suppliers based on differentiation, which makes differentiation the lifeblood of business, sales…and the currency of every sales organization. It’s as simple as that.

Your company can differentiate in multiple ways:

  • Product/service fitness for use,
  • Product/service image,
  • Post-sale (I call it between-sales) service,
  • Availability/convenience,
  • Saving one or more customer costs,
  • Making the customer more competitive,
  • etc.
  • OK, and the lowest price.

Look back at that list. They all require resource investments to develop. Yes, even achieving long-term cost advantage (operational efficiency) consumes resources. Differentiation isn’t free, it’s purchased. If your profit streams don’t feed the investments that build on your differentiation, you’re hollowing out your company.

If you don’t reward pricing to differentiated value, you’ll eventually get exactly the level of differentiation you can afford.

Another Bad Outcome:  Sales’ Place at the Table

I hear sales leaders complain that they and/or their function doesn’t get the respect it deserves. As a sales leader, did you ever ask if you’re getting exactly the respect you’ve built?

Imagine people in any other department of your company, all of whom work hard to maximize profit.  Now imagine them hearing some knucklehead in sales saying “it’s the company’s job to make a profit at this price”…then then being backed by the sales leader (no, this isn’t hypothetical.  It happens.). If sales don’t work toward the same thing (profit) as everyone else in the company, why would their sales leader “get a seat at the leadership table”?

I’ve heard sales complain that it is “unfair to pay us on profitability”.  Remember: sales not only works with an unobstructed view to customer value — it’s the main job is building value in customers’ minds. Given these facts, does this “unfairness” complaint — from the one function charged with building and capturing value — earn the company’s trust? Executives’ trust?  Would an executive dare to bring anyone who claimed that “unfairness” in front of their board? Should such a sales leader be anywhere on the succession plan?

Conversely, imagine this alternate reality: Sales is the function consistently bringing new customer value insights back to the hive for commercialization: driving focused innovation, powerful differentiation, impactful marketing strategies, and confidently capturing profitable pricing that pays for it all.  Would a leader of such a sales function deserve “a seat at the table”?

If you don’t reward pricing to value, you’ll get exactly the respect you’ve earned.

Perhaps Worst of All:  You’ll Get the Customers You Deserve.

Price-sensitive customers are the least loyal.  Often they’re the most demanding, most costly, hardest to service, make your people the most miserable and stressed, and consume disproportionate resources. If your people aren’t able to — or aren’t paid to — capture value, you’ll find yourself winning the worst customers…the ones your smarter competitors are thrilled to let you win…and Barry Trailer will be right again.

If your salespeople aren’t paid to co-create value, they’ll end up co-creating apathy.

How Bad Is It, Really?

The odds are, you don’t even know how bad your problem is.

It seems that only a quarter of sales teams have any profitability component in their comp plans. And that’s only the top level of the problem.

Every company should have deep analytics that tracks pricing/discounting behavior, and very few do. The overwhelming majority of companies don’t even track how much they give away in discounts every year, much less how/where discount dollars are allocated.  Even fewer have a robust price exception/ discounting system. For instance, can you answer this for your own company: Are pricing exceptions based on objectively measured customer value, the whiniest salesperson (OK, the salesperson best able to game your system), most politically connected regional manager, or something else?

CEOs and CFOs:  Do you even track how many discount dollars you spend, and how they are distributed? Can you break down how discounting dollars (or gross margins) are distributed by salesperson, sales manager, customer, region, etc.  If not, you’re probably bleeding profit dollars without knowing it. Your cost of sales may be twice what you think it is.

If you don’t measure your pricing practices, you don’t understand them…and you don’t know how much they’re costing you.

Rewarding it vs. Doing Something About it

This article focuses on your compensation plan, but it should be apparent that comp is only one leg of a stool.  The stool topples without a solid comp plan, but also can’t stand if comp is the only issue you solve.

Other legs of the stool are more directly focused on how to sell value – the behaviors getting rewarded under the right comp plan.  Chief among these are training and ongoing coaching: enablement, in the current vernacular.

Once your sales team wants to consistently build, measure – and capture — customer value, a lot of powerful outcomes materialize.

  • More sales at more profitable prices, which funds even more differentiation.
  • Sales opportunity reviews that discuss customer value display selling expertise, which drives the credibility of the sales organization.
  • Clear & objective measurement of customer value can drive objective, precise pricing and discounting decisions. Your whole company can objectively see why a given discount was needed.
  • More accurate forecasts, which of course drives credibility of the sales organization

Want to talk about anything in this article?  Post it below, or if you want to have a deeper dialogue, contact me. As always, please like and/or share it with your networks.

To Your Success!

Categories
Marketing Personal Development

Fill up your audience with the meat and potatoes…

It’s one thing to have bursts of inspiration…

…It’s quite another to develop them into compelling pieces of online content

I was on the phone the other day with a speaker who is looking to dive more into creating online content with the brand new lifestyle portraits we just created.

Since I’m a big fan of getting into the weeds with people about creating social posts and blog articles, I started spitting out the why behind creating a memorable online presence through the creation of compelling and valuable content. I told him that he wants all of his online content to either inform, entertain and/or inspire his audience into action.

I then dove into the importance of generating idea nuggets, and how they are the backbone of your storytelling strategy.

These are the insights, conversations, and moments that happen throughout your day – work and personal lives – that are the sparks of inspiration to create these compelling and valuable pieces of content.

Then, I started talking to him about the relationship between these idea nuggets and the image content that he now has at his disposal. The images, I explained, visually punctuate the sentiment of every story that he wants to share, whether it’s for social media, blog articles, an ad, presentation or even copy on his website.

As I was about to dive deeper on how to leverage his photos, he backtracked for a second and asked me:

“How do you develop an idea nugget into an actual post?”

Now, there’s a lot of books that have been written on this subject. You know, the Greeks and Romans put in a lot of work on this subject already, 🙂

Over the years, I’ve gleaned some valuable information on storytelling development from these foundational pillars.

But, as I’ve embarked on creating content that resonates with my audience, I’ve created my own customized framework in order to develop a process that makes sense to me.

Essentially, I break down online content development into 4 primary storytelling sections:

  • Opening Spiel
  • Meat And Potatoes
  • The Closer
  • Call To Action

But before I dive into what each of these sections mean to overall story development, let’s start at the beginning.

IDEA NUGGET CREATION

While I’m going about my day-to-day work and an interesting idea enters my consciousness, I’ll make sure that I write it down in my phone. Now, for you, that might mean writing it down on a post-it, whiteboard in your office or in a notebook.

The key here is that you’re writing it down and protecting it from your shitty memory that fails you on a minute-by-minute basis – especially in this hectic, short attention span world in which we live.

In some cases, I’ll go ahead and develop the idea immediately from my phone, or I’ll store it away for a rainy day and develop it at a later time.

Regardless of when I further develop it, the first step is to figure out what this idea nugget represents in the grand storytelling scheme.

Does it represent a teachable moment for my audience? Is it an actionable step for them? A funny and catchy title? A revealing statement about what motivates me as a human being? An example of my expertise? Does this share the type of experience I offer clients? Is this an interesting zinger that can be used to wrap up the post?

Or, does this idea nugget serve to inspire a completely different idea altogether?

Once there’s more context placed around this particular string of words with respect to the value it offers my audience, the next step is to determine where they fall within the storytelling structure I mentioned above.

Let’s take a closer look at these sections to help you understand their purpose.

DISSECTING THE STORYTELLING SECTIONS

Opening Spiel

What can I say, I’m a fan of Yiddish words, 🙂

Set the scene of your post by sharing a story that eases the audience into the point of this piece of content. This story introduces and reinforces the need for audience members to keep reading because they are going to learn something valuable, whether it’s related to their pain points or related to them getting to know you better.

What does the opening spiel look like?

Well, if we look closer at this article, the idea nugget that I had written down that spawned this article was simply:

Create an article that talks more about idea nugget maturation – from a thought to a post.

When I sat down to develop that insight-inspired nugget into a compelling and valuable story, I remembered a conversation I had with a client in the not-too-distant past about this very topic.

I realized immediately that was going to be the topic of my opening spiel.

Now, that’s one specific way to create an opening story, but there are many ways to open your post:

  • Start with a question that relates directly to a particular client friction point
  • Start off with misdirection – walk your audience down the “wrong” path before you grab their hand and course-correct them in the rest of the post
  • Create a contrast between the way you used to think about a topic, and how you approach it now (which represents the teachable moment for your audience)
  • Pull a quote from something you read that relates in one way or form to the lesson you want to share with those you serve
  • Share an observation that inspired a particular way of thinking about a topic
  • Share something that places you in a position of vulnerability

Regardless of how you begin your story, create an emotional connection and relate it to the reader from the very first sentence, and that will hook people in with your opening spiel and give them a reason to continue reading.

Meat And Potatoes

I like the phrase meat and potatoes because, for me, it symbolizes sustenance – the true value of what you’re sharing with those you serve. The opening spiel, however you choose to craft it, serves to move people directly into this section.

These are teachable moments – actionable steps, deep insights, and further elaboration – that your audience can take away and implement into their own businesses and lives.

Whether you’re providing them insight that illustrates your expertise, life as a business owner or life as a human being, this is the section where you flesh out these important story points.

Taking this article as an example, the meat and potatoes is the storytelling framework that I’m fleshing out for you now.

This is the takeaway that I want to impart to everyone reading this so they can create and implement a smoother and more fluid storytelling process.

Still got room in your belly for more? Cool – let’s keep it going, shall we? 🙂

The Closer

After you tickle them with a feather of value in the meat and potatoes section of your post you then need to tie a bow on this piece of content that ties everything together.

How do you approach this? You could:

  • Summarize what you’ve shared in a way that distills the important pieces into a handful of sentences
  • Share the potential results of them being actionable in the way you describe in the meat and potatoes section
  • Write a punchy and quick-witted closing paragraph that allows your personality to shine
  • Add a twist to the story and allow your audience to see everything you just shared with them in a more valuable and beneficial context
  • Offer them a motivational kick in the ass to get them moving in a positive direction
  • Create an emotional and touching conclusion that will resonate with your audience beyond the information itself

I have a bit more to go before I reveal my closer, so hang tight for it. I can tell you that it’s related to one of these above examples – and that’s all I’m telling you for now, 🙂

Call-To-Action

Why do we need one of these?

Although it’s great to impart valuable and compelling content, it’s important to include a next-step.

After all, we’re not in the business of posting content simply to throw out into the world and enlighten a couple of folks. We’re looking to build relationships with a community of folks that we serve and establish our value to them.

We also need them to know HOW we offer that unique value.

With that in mind, what do you want your audience to do once they’ve consumed this particular piece of content?

  • Pose a question to incite engagement on this post
  • Provide a link to sign up for your newsletter
  • Point them towards more content related to this topic in your blog
  • Encourage them to follow you on social media
  • Have them sign up for a webinar/workshop/online course related to the information shared in this post
  • Pick up the phone and call you for a consultation

Each piece of content that you create has its own call to action, so, you can think of different and interesting ways to allow your audience to further connect with you beyond the post itself.

Don’t flood your audience with multiple calls-to-action – keep their effort simple by only using one per piece of content.

I haven’t figured out my call to action yet for this post, but I’ll have something by the time we get there, don’t worry, 🙂

AHEM…AND NOW, THE CLOSER

Creating consistent and valuable content is a pain in the ass, there’s no doubt about it. Even when we have interesting idea nuggets at our disposal, it’s still challenging to build entire stories around them.

That’s why it’s essential to have a framework in place to help facilitate the storytelling strategy process.

My hope is that the framework in which I leverage on a daily basis helps you in your efforts to create memorable, compelling and valuable online content.

Now, take what you’ve learned and go write some magical content, will ya?

CTA TIME

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Want me to do you a favor and send them directly to your inbox to save you the commute to my blog?

You can sign up for it here – and receive some free goodies in the process.

Categories
Investing Marketing Personal Development Sales

Build Your Sales Capability From the Most Important Core

Every sales performance expert learns that adding rigor and process to average selling improves results.  Not nearly as many know what rigor and process won’t accomplish the most important thing.  The detail and rigor that methodology adds often diverts attention and management energy away from the real work of selling: getting a buyer to see value in your proposal.

I sold sales skills and methodologies for almost a decade, and have helped many companies implement them. I have lived in a methodology for a quarter-century. I’m rock solid in my support these tools, but I have also come to learn what they can’t – and don’t—do. Typically, they allocate training time and coaching energy about as shown on this inverted pyramid:

The bottom two represent selling progress.  Without that, everything else is selling motion: activity — with or without progress.  If your people are already good at the bottom two, the top items are a great refinement. If they stink at the last two, fix that before investing in process rigor. In fairness, some people think that building customer value is a skillset reserved for product training.  Not really, although there are some elements of product training that will help a salesperson build customer value.

That Sounds Radical, Mark. Can You Back It Up?

Let’s look at some research:

CSO Insights has just updated its list of the twelve behaviors that correlate with the highest-performing sales organizations (World Class Sales Organizations, or WCSOs for short). WCSOs are elite performers, with 23% higher win rates, 23% higher rates of quota attainment (they achieve success more widely across the sales force), retention is 7% higher, and they make revenue plan at a 5% higher rate.  Summary:  you want your organization to be one of these WCSOs.

Here are the 12 behaviors of WCSOs.  The organization scheme is my own.

Organizational alignment around the customer journey:

  • Sales, Marketing, & Services
  • Sales Operations, Sales Enablement, & Sales Management
  • Consistency Across Channels
  • Data strategy that aligns and coordinates all functions

Value Focused selling:

  • Mutually-valuable customer conversations
  • Purposeful, [value-evoking — my emphasis] customer conversations, using a call planning tool
  • Effective value messaging

Their People are a Priority:

  • A quality talent strategy
  • Use of formal assessments in hiring and performance management
  • Effective sales coaching
  • A culture of continuous development (vs. “train-and-coast”)

Plus one outlier:

  • A rigorous forecasting process. (I happen to believe in one particular kind of rigor: value-informed forecasting, but that is only a subcategory of this more general behavior CSOi describes).

Look at that list again:  Sales process and methodology don’t make the top 12 behaviors of world-class sales organizations. Playbooks aren’t there either. Your marketing stack is only a subset of value messaging. I’d venture to say that every one of those world-class organizations uses process and methodology, but so do average-performing organizations. The results as I see them:  customer value focus dominates the mix of WCSO indicators: it forms the backbone of at least nine of the behaviors and informs the rest.

Here’s another research tidbit specifically on value-building:  Rain Group has found that Value-Driving sales organizations have 20% higher win rates, and are 25% more likely to grow revenue.  There’s more, but you get the idea.

Bottom line: value-focused selling is more highly correlated with sales excellence than a fine consensus selling methodology.  Sales leaders, and sales enablement pros: what does that mean to you in your role? How might it affect your plans for 2020?

What’s at the Core of Sales?

Value is the basis—it’s at the core — of all commerce.  And sales. Perceived value determines if a prospect will open an email, click on a link, accept an invitation to meet, sit through a demo…or choose your proposal over the status quo. Insufficient value is what prevents transactions.

Since value is at the core of sales, you need to audit how effectively your salespeople build it in your customers’ minds.  I have bad news. Most salespeople are good at going through the motions you trained them to perform, but are not that good at building value in your customers’ minds.

Practitioners of multiple sales methodologies have told me the same thing over and over (and I’ve experienced first-hand in almost a decade of work with one leading B2B methodology).  Salespeople are pretty good at the methodology details (the vast majority of top-of-inverted-pyramid training/coaching time and energy you drilled into their heads…after which they somehow got the impression is the most important), but are sloppy about understanding customer-perceived value…the core.  Sure, each methodology labels it differently, but the failure point is the same: understanding, then building value inside a prospect’s mind.

Every sales force has the same challenge…so do probably most of your competitors.  What does that mean to you in your role? How might it affect your plans for 2020?

Put the Pyramid Right-Side-Up: Value As The Strong Foundation

The foundation of selling is changing perceived value of your offer as compared to any other option, including status quo. Don’t build sales process and methodology on a weak foundation.  Make you salespeople superior at understanding – then building — customer value. Build from there.  Methodology then becomes a force multiplier.

Oh yeah.  Once they are good at building value, they’ll be better at avoiding discounts. VPs of Sales, CFOs, CEOs and board members:  what does that mean to you in your role? How might it affect your plans for 2020?

I’m not anti-methodology.  I’m for getting the biggest bang for your buck.  I’m for adding value to your sales team’s adding value. What are you for?

Like or share if this resonates with you.  Comment below if the mood strikes you. Contact me if we should talk.

To your success!

Categories
Best Practices Economics Marketing Personal Development Sales

The Challenge of Pricing Disruptive Technologies

This month, I attended a couple of entrepreneur and investor events.  The term “disruptive technology” appeared frequently and prominently – as it should.  What figured less prominently was an understanding of how to capture the value of disruptive technology in the form of price.

If you’re disrupting, you’re delivering value differently….often enabling value differently.  You need to be paid for your creativity…That’s the market imperative. After all, it costs money for a company to build new, highly differentiated value…and the price is how that all gets paid for.

My Lens on the World: Value-based pricing.

Full disclosure: when I call myself a sales, value, and pricing expert, I mean I am an expert on helping companies achieve win-win, value-based pricing.  Customers use price as a comparison point against perceived value. If I can help your B2B salespeople regularly build enough value, customers will have stronger buying preference, at higher prices.

I’ve heard several good definitions of value, but for our purposes, I’d like to use this one:

Value is the desirability of outcomes your products or services deliver to a customer.

This definition gives insight into how value forms and builds in the customer’s mind.  It guides to sales and marketing organizations working to build – then objectively price – a disruptive innovation.

Outcome-based Value Analysis.

Customers don’t buy your offer; they buy their own outcomes/results.  What they are willing to pay for your offer is how strongly they desire results.

Human buying behavior around price is pretty consistent.  Customers:

  1. Compare noticeable differences between options (almost always the top two).
  2. Translate differences into personal and business outcomes. Any outcomes not envisioned are ignored.
  3. Assign value to all outcomes. “Assigning value” can be gut feel, emotional desirability…all the way to a formal analysis of business impacts.
  4. Compare the value of outcomes to the relative prices, and buy according to this calculation

The good news:  This is how customers operate intuitively. It’s no work at all to get a customer to engage in this mental process. Did you ever pay more for gas because a station is easier to get to? How much work went into getting you do decide?

The bad news: contrary to what “rational buyer” economic theory predicts, customers only think as hard as they need to (read those four steps again to see how mental shortcuts could form). It’s not particularly hard to force more detail on their process, it simply takes purposeful selling and marketing effort at the right time.

For established products, salespeople must either walk a prospect through more detail in analysis…or hope that the customer makes perfect value assessments unguided. Hint: they almost never do. I have a secure income helping “established product/service” companies sell at better prices.

For disruptive products, value-building must be even more purposeful. Each customer is walking an unfamiliar path.  They require more detailed guidance all along the way: comprehending novel outcomes, envisioning those outcomes for themselves, belief/confidence in realizing outcomes, valuing outcomes, and more.

Penetration / Skim pricing: a Myth?

The Internet age has introduced us to the idea of buying profitless market share and figuring things out later: penetration pricing is the new false idol of business.

You can — and people do– price disruptive technology for profitable penetration.  The key:  be in a winner-take-most (WTM) market.  Only buy market share in WTM markets….and either have deep pockets or patient money.  Any company bringing a disruptive offer to a normal market is at risk with a penetration pricing strategy.  You’re far more likely to end up as roadkill than as the next Amazon.

As long as your price is less than your value, the idea of charging less to sell more is a myth (the topic of one of my most popular posts ever).  The demand curve you learned in econ class is based upon several unrealistic assumptions – assumptions made so that the math works more easily, not to explain real-world buyer behavior. For one thing, the math assumes little to no differentiation.  In contrast, the whole point of disruption is differentiation.

Pricing Is Profit

Regardless of the price you charge for a piece of business, your production costs don’t change.  That means that an additional price dollar is a bottom-line dollar.  Conversely, every dollar you don’t charge (or discount away) is a profit dollar you just donated to a customer.

Those profit dollars?  You need them for disrupting, innovating, customer education, etc. Whether you do subscription pricing (or its economic cousin, leasing), or whether your offer involves Uber-style distributed asset ownership (or its economic cousin, franchising)…understanding who receives what outcome/value is the key to a successful pricing strategy.

You Can’t Price The Value You Haven’t Built

If your disruptive offer generates value, you need to have a system for causing that value to come into being in the customer’s mind.  In consumer markets, this might come via media-delivered content.  In a complex/consensus B2B environment, the mix will shift to include more human-to-human value-building customer conversations: that’s my thing.

Disruptive Change and Value

Value only exists in a customer’s mind.  Value for something disruptive often involves a little more commercial teaching work — getting a customer to wrap their mind around a novel outcome.  Unless the outcome is unusually intuitive, that takes some sort of value building communication. That value building is rewarded by a higher, value-based price.

I hope this helps.  If you’d like to talk in greater depth, please feel free to reach out. Also, I’d appreciate your liking, commenting, or sharing with your networks, or with colleagues who it might resonate with.

To your success!