Horses, Sweet Potatoes and High Prices

"The oats are always cheaper after they have been through the horse."   

- Zig Ziglar

 

I have always loved this quote and I remembered this article from a while ago that provides some insights into how to overcome the price objection. It is not your prospects fault for being too price sensitive. It all starts with you and how you convince them of the value of what you are selling. What about the sweet potatoes? Read on.

3 Ways To Head Off Complaints About High Prices
By Howard Jacobson
October 24, 2012

If your prospects are too darn price-sensitive, stop blaming them. It's your responsibility to educate them about the difference and value of your stuff. Use these common-sense techniques to do just that.

Yesterday I spent three hours as part of a volunteer "Crop Mob" at a local farm, helping to bring in the sweet potato harvest. I learned a lot about farming, but the most significant lesson had nothing to do with growing or harvesting. My main thought was: "Sweet potatoes are a damn bargain at the farmers' market. I don't care how much they cost, the farmer didn't get paid enough." Once you realize how much work goes into them, lots of things seem like a damned bargain.

What Don't You Get Paid Enough For?

What goods or services do your prospects and customers take for granted? Which ones get the most price resistance? If you find yourself constantly competing on price or justifying your prices, you've got a buried sweet potato problem.

If your prospects walk past the overflowing baskets at the farmers' market or farm stand, perhaps they just aren't educated enough to know the intense work and costly inputs that go into producing that bounty. So they wonder why it isn't cheaper.

As you can imagine, a farmer working his ass off to bring in $24,000 a year can get pretty upset by an upscale suburban professional who just got out of a Lexus SUV professing shock and outrage at sweet potatoes at $3 a pound.

But it's the farmer's responsibility, not the consumer's, to make the value clear.

What's Your Big Difference?

If you offer a premium product or service, then it's even more important to educate your market about the differences. After all, I can get industrial genetically modified sweet potatoes, loaded with pesticides and herbicides and synthetic fertilizers, for about 79 cents a pound at my local Kroger.

But the organic, pesticide-free, sustainably grown heirloom sweet potatoes available from my local farmer cost four times that. Until yesterday, I wasn't all that clear on the reasons.

Now I see how much effort goes into preparing the beds with hand tools and small tractors. Into propagating the slips ("seedling vines") in greenhouses. Into planting the beds. Into laying and monitoring thousands of feet of drip irrigation. Into protecting the growing plants from flea beetles, hornworms, leafhoppers, weevils, and rats. Into gently digging the beds to assess growth and harvest readiness. Into checking the weather hourly in fall to be ready in case of frost. Into digging out the harvest (or marketing to volunteers to help--and there weren't that many of us!).

Now I'll pay that sweet-potato premium gladly.

Three Ways to Communicate Value
How can you invite your customers and prospects behind the scenes, so they can vicariously experience and appreciate the efforts, costs, and sacrifices that go into the quality of your stuff?

You don't have to literally engage your prospects in your work. But there are plenty of ways to demonstrate that your prices are fair.

1. Demonstration of Difference

Joel Salatin, lunatic farmer, shares his blow-by-blow sales technique at his local farmers' market, displaying his eggs and chickens side by side with industrially produced eggs and birds.

The visual of the brightly colored yolk and the tactile experience of the firm flesh enable Salatin to make his point that his animals are healthy, and so eating them is better for your family.

How can you demonstrate the difference between your premium products and services and the competition's shortcuts?

An accounting firm can anonymize and post two sample returns for the same household, showing the one done by their accountants generated 30% more deductions.

A tree service website could show videos of the owner meticulously taking care of his chain saw, using old fashioned Oregon chain saw files that are no longer in production.

You can post video and audio testimonials of clients telling their stories of how you went the extra mile for them.

2. Supply Chain Transparency

When the late, great Tom Hoobyar was selling valves to the pharmaceutical industry, he knew a lot was riding on the performance of those valves: Millions of dollars of pharmaceutical gloop in giant vats could be lost if a valve failed.

So he created a slide show that he called "The Odyssey of a Valve" that followed a hunk of metal from its birth inside an open pit mine to its final shape as a highly machined, highly polished, highly tested valve. (You can find the slide show here.)

Anyone watching that is filled with confidence about the manufacturing process, and clearly is not in a mood to quibble over a few dollars. The effect of this slide show is a little like the rant that my friend Michael's father made in 1981 when I complained to him that the rate for a first class postage stamp had gone from 18 to 20 cents:

"Let's get this straight: You want an organization to send someone to your house and pick up this letter, walk it to a truck, drive it to a post office, sort it into a sack, put it on another truck, drive it to an airport, carry it to a plane, fly it across the country, unload it onto yet another truck, drive it to another post office, sort it, put it in a sack, drive it to your friend's street, and walk it to their mailbox for 20 cents--and you want change?!"

With this perspective, I never complained about another postal rate increase.

3. Teach Your Prospect to Do Without You

I discovered the potential of this means of communicating value when my book, AdWords For Dummies, was first published. At 408 pages, it was pretty comprehensive in its day (2007). And it laid out in clear detail, with lots of screen shots, exactly how I did what I did for clients.

I kind of figured that that $16 book had ruined my professional career as a consultant. After all, why would anyone pay me lots of money to do what I had just revealed in its entirety?

Naturally, the opposite happened. Once people read the book and discovered how complicated and time-consuming AdWords could be, they were happy to hire me to do it for them.

If you can teach your prospects to do without you, that's one of the best backhanded ways of demonstrating your value. They'll quickly see that they lack the experience, time, and desire to accomplish what you do at anywhere near your level of quality and efficiency.

(If this isn't true, of course, then you don't have a real business anyway, and nothing I'm suggesting is going to save you until you find a way to add real and enduring value.)

Now if you'll excuse me, I'm going to make a sweet potato pie. Because ain't nobody can make a pie like I can!

Sales Is Broken

"We must take change by the hand or rest assuredly, change will take us by the throat."

-- Winston Churchill, Former British prime minister

The always "on" world of the web makes it vital that we, as business owners, take a hard look at how we go to market. Modern businesses recognize that buyers have access to real-time information on any product or service that interests them. They are thrilled to wait until they are "fully educated" before finally making a decision to reach out to a salesperson or company.

The web is an unlimited source of information about products, pricing, how to fix them, reviews, etc. - everything you need to know by just imputing some keywords or phrases.

So the more real time information (content) you make available to them, the more people you will be attracting to your website, social pages, etc., and the more likely they will be to trust you enough to contact you.

This is a marketing subject for another day but the topic of this article is - sales is broken. The way we set up our sales organizations, the sales processes we use, how we serve the prospect and customer may need to change radically, but most of us are selling like it is 2004.

In 2004 the salesperson had the power of position when they were the gate keepers of information. Think about the process of buying a car. You would be exposed to television and magazine ads, you could get a hardcopy of Consumer Reports and ask friends and relatives for advice, but to get the real information you had to go see a salesman who smugly had all of the information.

It is the same with any big purchase. Even today most companies still get their leads (many from their website) and give it directly to a salesperson who assumes her job is instigate "the sales process" and begin selling the prospect. If they determine they are not ready to buy in the next few weeks, that "lead", many times, ends up in the virtual void never to be contacted again.

In 2014 your sales people should assume they are the last place a buyer is going, not the first. They must assume very little of their knowledge is proprietary. They need to begin to facilitate the buying process at this point, not initiate the old selling process. They need to determine what pain or fear the buyer is looking to solve, where in the buying cycle (their search for information) the prospect is and supply the additional information the buyer needs to make his decision.

Think about buying a car again. How do you want the salesperson to interact with you today? Smugly, "I hold all the cards",  "I need to convince you today to buy this car", or assume you already have the information? No selling is needed, they just serve you by clearing up any questions you still have and supplying you with that last bit of information you need to make a buying decision.

For some companies the tradeshow demo or on-site demo is an important part of their sales process. Most of these today are conducted out of laziness on the salesperson's part. They practice the demos and spew out feature after feature and throw in a few benefits but lean on this technique to complete their old selling process.

What serious prospect has not gone on-line and seen several videotaped demos way before they talk to a sales person? Any conversations in today's world should begin with the assumption the buyer has the information, and they are at some stage of the buying process and we need to start the conversation determining their pain/fear and what solutions we have to solve it for them. That is the information they are seeking, that final sharing of information that will get them to trust you are the company for them.

As for those inquiries "leads" that come in and are handed to sales - they are just that and the fact that they some are not ready to buy today does not mean that they should be qualified and ignored. These suspects are just in the earlier stages of gathering information and we should put them in our database and send them information on a regular basis (with their permission) to add to their knowledge and nurture them along their buying process.

In short, you need to begin now to load your website with good relevant information (content) and give it away free with no signups. It will drive more people to your site and will create more contacts from interested prospects. You should get a TIPS blog going and send this out to all customers and prospects - good, short, relevant information (content) on a consistent basis. (Like I do with this article and my blog.)

Video, articles, industry statistics, maintenance, etc. - load up your website with it and send it out as you create it. Take the most frequently asked questions and go online, to your vendors and get short content - tips - to answer them.

Sales - rethink, with an objective mind, how you can change your sales process to become a buying process. How can you restructure your sales organization to more efficiently and effectively cover your market. Telesales - does it have a place in your company? Think about the last 6 months how many deals have you closed over the phone because the prospect called in armed with information and was ready to make a decision with a little more information that can be sent via email. If you have outside sales people how can you put them in position to have more conversations every day? Could teaming them with an inside sales coordinator who does all the follow up work and makes appointments for them make them 2-3 times more productive?

Sales is broken, it is up to you to take a look at what you are doing and make the changes to align with the new world of free information on everything in the world.

Ask yourself - How can I serve more customers and prospects, more efficiently and effectively, in the least amount of time? What is their buying cycle and where does marketing and sales fit into it?

Slow Down to Speed Up

 "You have more to do than you can possibly do.
You just need to feel good about your choices."
 - David Allen

"Saying "no" will be uncomfortable for a few minutes, but saying "yes" can nag you for weeks, months and sometimes years."

- Greg McKeown

 

Victims are victims of their own to-do lists. They make the list up, stare at the multitude of tasks to be done, and feel overwhelmed. They think to themselves, "I have more to do than I can possibly get done." That thought alone acts as a central nervous system depressant. Just thinking "I have more to do than I can possibly get done" causes the victim to lose energy. Soon a huge sense of overwhelm and fatigue sets in. Consciousness clouds over. Weariness and depression set in. The victim looks back down at the list and picks it up in a limp hand and then tosses it down. When someone peeks in at the victim and says, "Got a minute?" the victim says, "Of course." Now the victim talks for twenty minutes about something not even on the list! It gets worse, and there's no end to this.

The owner realizes something that this victim does not. Time management is not a matter of managing tasks, time, learning to multitask, or becoming more organized. Time management is about courage. Plain and simple. It is a boldness issue, and only boldness will solve the problem of time management. Only courage will demolish that list. And when someone pokes their head in and asks "Got a minute?", you can smile and say NO.

You must slow down to get more done. Remember the logger who was asked to clear a lot in one day. The faster he went the slower he got. Why? He never stopped and sharpened his saw.

You cannot possibly do everything that is asked of you every day. You have to learn to stop and think, "is this going to help me and company reach our long term goals, our quarterly goals, etc?" If it does not, then you have to politely say no and focus your most precious resource - your time - on the right things that will. 

You see consistency is the key to effectiveness, success and goal attainment. What do I mean?

Well most people run around starting on things and going like hell for a few days, or week, and then stop and get distracted by something else that is usually looked at as urgent but not important. 

This cycle of start and stop, to-do lists, interruptions and not "sharpening the saw" leads to stress and frustration. 

However it is more than that. You are not developing habits that will lead to your success and reduce the stress. To do that we need to be consistent. Here is what I mean.

By Darren Hardy

"I used to get frustrated when I would start a new venture and I'd see the competition leap out in front and get off to a fast and successful start. Then I found the single discipline that gives me the advantage to beat anybody at almost anything - CONSISTENCY.

A lot of people become gung-ho about new goals or achievements, and they charge out of the gate in an explosion of activity, but their intensity and commitment quickly fizzle. Meanwhile, those who begin the journey with less flash but a greater commitment to consistency eventually catch up to their flamboyant peers and leave them in the dust. Do what most people don't: Stay consistent.

Lack of consistency is the subtle stealer of dreams. The stop and start process kills progress in any pursuit. In fact, inconsistency is one of the biggest reasons people don't achieve their goals, and instead end up living a life of frustration and disappointment.

When you start thinking about slacking off on your action plan, routines and rhythms, consider the massive cost of inconsistency. It is not the loss of the single action and the tiny results it creates; it is the utter collapse and loss of momentum your entire progress will suffer.

 

Zig Ziglar uses the analogy of a hand-pumped water well. The water table is 25 feet below the ground. A pipe runs down to the water table, and you have to pump the lever to create the suction that brings the water above the ground and out of the spout.

When most people start a new endeavor, they grab the lever and start pumping really hard, they are excited, committed and resolute.... They pump and pump and pump, and after a few minutes (or a few weeks), when they don't see any water (results), they give up pumping the lever altogether.

The first few people they showed the product to didn't buy. After two weeks on their new health plan, they haven't lost one pound. They didn't meet anyone at the first two networking events they attended.

People expect instant results, and when they don't see progress, they quit... before success has a chance to show itself. Wise people continue to pump.

If they persevere and continue to pump and pump the lever, eventually a few drops of water will appear. At this point, a lot of people say, "You've got to be kidding! All this pumping, and for what? A few drops of water? Forget it!"

Eight weeks of working out at the gym, and they don't look like a Victoria's Secret or Calvin Klein underwear model. They didn't make $10,000 their first 90 days in their new business. Again, they don't see the results they were expecting. They think their plan isn't working, and they quit. But the wise person persists.

If you continue to pump, eventually, you will get a full and steady stream of water. Congratulations, success!

But here's the real secret...

Once the water is flowing, you no longer need to pump the lever as hard or as quickly. It's easy to keep the pressure steady by just pumping the lever CONSISTENTLY.

Now, what happens if you let go of the lever for too long? The water falls back down into the ground, and you're back to square one. If you come back and pump the lever easily and steadily, you still won't get any water. You have lost the vacuum, or the momentum of your compounded effort. The only way to get the water flowing again is to pump the lever really hard all over again.

The problem with most people's lives is that they work really hard to get the water flowing and then take a break. Wham-o! They have to pump like crazy again just to get back to even. Living life in a constant state of fits and starts is frustrating and demoralizing.

People start up a routine of making 10 new prospecting calls a day, strike a little gold, and then don't dial for a couple of weeks. People get excited about their new "date night" routine with their spouse, but in a few weeks, it's back to Netflix and microwave popcorn on the couch Friday nights. I see people buy a new book, sign up for a new program or seminar and go like crazy for a couple of weeks or months. Then they stop and end up right back where they started-sound familiar?

Consistency is one of the most important principles of success.

Here are a few ways lack of consistency can negatively impact your life...
If you miss a couple weeks of workouts, or affectionate gestures to your wife, or slack off on your prospecting routine, you don't just lose the results those two weeks could have produced. If that is all you lost, not much damage would be done. What people don't realize is that by breaking their rhythm, they kill Mo (Momentum) - and that is the real tragedy. The cost to revive momentum is an enormous amount of time, energy and effort - not to advance, but to get back to where you started.

Committing to the principle of applying consistent effort to your goals will forever alter how you (could) live your life. One moment of inconsistency, a single poor choice, temporary inaction, a brief lapse of discipline doesn't simply result in the loss of that one action - it breaks your momentum. Your Mo has left the building.

It's not how you or your competition start; it's how you continue. If you stay consistent, even slowly (the tortoise), ultimately, you will beat the most talented of competitors (the hare). CONSISTENCY is why the tortoise beats the hare every time."

It is your choice keep running around trying to touch everything and say yes to everyone, (please them) stop and start and mutlitask or slow down, choose the right things to work on, give them your focus and time, serve people, and develop good habits through consistency.

Slow down. Sharpen the saw. And never let that pump lose its suction.

As always you can choose to be a Victim or an Owner.

Steve Chandler audio MP3, "15 minutes on Busyness is Laziness". Intrigued? Listen you'll like it.

Herbie Keeps On Ticking

Response from a reader of last week's post "The Slowest Hiker":

 "I see it as a non-success story from a management/employee viewpoint. When Herbie could not keep up and was holding everyone back, they not only held everyone else behind, but they distributed Herbie's (work)load to those who were more efficient. This is hardly fair to the other employees, yet it is what takes place every day in a company. Those who are the best at what they do get dumped on, while those who can't get their job done are rewarded with less work to do. It seems Herbie should have had one person assigned to make sure he got to the campsite safely, while allowing the others to move forward and set up camp. Next time they hike, they can leave Herbie at home (fired) or have him prove ahead of time that he can keep up with the group (time management, etc.)  What do you think?"

Last week I wrote a post about The Slowest Hiker. I received the response above and it occurred to me there is more learning that can be shared here.

First, Herbie is an analogy. He represents any constraint in a business, not just people. So, the moral of the story is to focus on and identify the constraint and then address it. The scout master had to watch over the troup and get them to camp by sunset. A clear project with a deadline.

Second, I totally agree with the reader above as to what should be done with "Herbie" after they get back home. I see example after example of business owners and managers walking by employees who are not performing and doing nothing about it because they hate recruiting and/or think they have not done enough to train the individual.

As you can see from the response above, every good employee knows who the Herbies are. They get tired of carrying the load for the Herbies of the world and the best ones usually quit because they are frustrated with management's lack of action.

I can't count the number of times clients of mine have finally let a Herbie go and remark how it lifted a weight off their shoulders, the company moral is up, people are happier, and some even came in and thanked the owner.

What do you do as a manager or owner to solve this issue in your company?

Always be recruiting and build a virtual bench of vetted recruits who are working somewhere else but are ready to come to work for you. It makes you a better coach and leader, and it makes for a great company with A Players in every position. The most onerous stress you deal with is someone walking in and quitting or the times you walk by employees you know are C Players and don't do anything about it.

A client just said this week to me that she is now always recruiting, all the time, every where she goes. She is looking for A Players, handing them her card and setting up a coffee or lunch meeting to talk if they are interested. It is easy because it is part of her day, everyday. Remember these people have jobs so you don't have to offer them a job today just be vetting and recruiting and building that bench so when the time comes you have that A Player ready to come into the game.

The Slowest Hiker

"People think focus means saying yes to the thing you've got to focus on. But that's not what it means at all. It means saying no to the hundred other good ideas that there are. You have to pick carefully. I'm actually as proud of the things we haven't done as the things I have done. Innovation is saying no to 1,000 things."

- Steve Jobs

I recently read a fantastic book by Greg McKeown, titled "Essentialism- The Disciplined Pursuit of Less."

Wow! It was so good I asked one of my Mastermind Groups to read it and gave each of them a chapter to do a deep dive and prepare a presentation on it for the group. We all met here in Western New York at one of the members houses on the Niagara River. It turned out to be a great retreat.

Two things that really stood out was the mantra "Less but Better", and the story of the slowest hiker.

We have all believed (yes one of those false beliefs, the lies that hold us back) that in business and in life more is better. But when you look at highly successful people and businesses you find that "less but better" is really the key.

Steve Jobs was always saying no and focusing on less but better. Seth Godin says, "if you want to be the best in the world make your world smaller." Steve Chandler touts, "winners focus, losers spray." The list goes on and on.

Learning to say "no" is critical to living a life of essentialism. As Greg says, "saying no may be uncomfortable for a few minutes or hours, but saying yes can nag you for weeks, months and even years."

Identify each day what is truly essential to get done and then focus on those few things with a laser focus. To do that you have to begin to say no, in a nice way, to the non-essential things in your life and business.

The Slowest Hiker
The slowest hiker story is a classic in regard to how to improve the efficiency in any part of a business or your life.

A scout troop is going on a hike. It is 10 miles to the campsite and the scout master is in charge of getting all the boys to the camp before sunset. They start out and of course some of the scouts are moving faster than others. Soon there is a huge gap between the slow and faster scouts. One boy, Herbie, is really behind everyone and the scout master cannot keep an eye on everyone because they are so strung out.

So he stops the faster scouts and has them wait for the others and then on Herbie. Now they are all together but of course within minutes the problem is recreated.

So he puts Herbie in the lead and all the others behind him. Problem fixed - right? No. Now they will never reach camp before sunset. So he decides Herbie is the key, so he takes all the stuff out of Herbie's pack and distributes it amongst the troup. Herbie can now move fast enough to get to camp by sunset but not faster than the others, and thus leads the group into camp on time.

Morale of the story - identify the constraint and then focus on eliminating it. Too often we simply go at things without thinking it through and identifying the true constraint. We usually move with great speed to do more, we try all sorts of band aids and sometimes make matters worse.

Slow down, say no to the non- essential, find the Herbies (constraints) in your business and do LESS BUT BETTER.

All the best,
Rick Wallace