Selling Power Magazine Article

We’ve all heard the legendary tales of businesses that were started and flourished in a tough economic environment. Think GE, HP, and Microsoft, to name a few. But that was then; this is now. Can the stories of these companies help today’s sales forces survive the current economic downturn? The answer is a resounding yes.
 

With the help of current sales reps and managers who are serving some of the economy’s hardest-hit industries – including manufacturing and automotive – here are eight ways you can stay afloat, despite the problems in your target market.

1. Adjust your attitude.
Once you or your team accepts the false premise that no one is buying, you’re sunk. The truth is, as long as business doors are open, someone is buying something. If your customers are staying in business, they’ve got to purchase supplies, equipment, raw materials, consulting expertise, and more.
 

As a coach, bring your team together to share success stories, commiserate, and bolster each others’ spirits, suggests Bob Greenberg, regional sales manager for Agilent Technologies’s vacuum-products division, which sells to the aerospace, manufacturing, and semiconductor industries. Isolation can be a killer for salespeople, so finding ways to come together and connect can combat the black clouds.
 

Greenberg also warns against letting a downturn be an excuse for lack of activity. “These are the vagaries of business cycles,” he says. Salespeople have to train themselves to continue with their full-circle activities, “from sowing the seeds to reaping, even if there isn’t a lot of reaping going on.”
 

Historic success story: Bill Gates started Microsoft in the economic slowdown of the mid-1970s. If he’d believed no one was buying computers, he’d never have attempted to market his MS-DOS to IBM. Take a lesson from Gates, and know when you’ve got the right product. Sowing seeds, even in a downturn, can lead to big harvests in the future.

2. Subsegment your market.
Even within apparently devastated industries, such as the automotive sector, there are small pockets of sunshine. Dig deep, read the news, talk to everyone you can, and figure out where that sunshine is. For instance, even in Detroit, good things are happening. Buses, economy cars, and electric vehicles are all potential hot spots, says Bill Bournias, a 28-year automotive industry veteran who consults on sales and marketing to that sector through Michigan-based Klep Consulting. Talk to your contacts and find out what’s happening and what’s viable or not, he recommends. Then position yourself to move into those subsegments.
 

Historic success story: Even during the Great Depression, certain segments of the economy experienced growth. Case in point: due to the federal government’s investment in public-works projects, the manufacture of construction equipment, steel, and heavy machinery flourished. Find out where dollars are being spent, even if it’s not in the usual places.

3. Get referrals.
That personal connection is even more critical in times when dollars are tight and the economic outlook is poor. Convincing tight-fisted execs to trust you with precious dollars is never an easy task, but if you can come armed with referrals from colleagues, you’ll be able to make a stronger case.
 

John C. Guidroz is an Alabama-based distributor for V-Blox voltage control and surge protection, whose customers are largely in the automotive and manufacturing industries. Guidroz says he often receives referrals from an unlikely source: plant electricians, who are actually at risk of losing a share of their lucrative service contracts when V-Blox enters the scene and installs its equipment. Why, then, do they call Guidroz? Because they’re paid a referral fee of three percent. The up-front commission often far outweighs the electricians’ lost service fee, making the deal a win-win-win for referrer, V-Blox, and facility owner.
Historic success story: Although HP is currently facing some daunting challenges along with a CEO shake-up, remember, it’s still an enormous global company with a huge footprint. While it wasn’t always a multibillion-dollar company, its founders always had the benefit of a strong network, even back in the belt-tightening 1950s. Relationships with such other engineering luminaries of the time as Stanford’s professor Frederick Terman helped Hewlett and Packard gain a foothold in the burgeoning engineering industry. Start working your own network to support your cause, providing incentives, as Guidroz does, as necessary. 

 4. Create new financing options.
You’ve met the decision makers, analyzed their needs, made your pitch, and gotten buy-in. The problem? They love you but don’t have the cash to make the purchase. And working out financing details just might be the toughest part of your job. But with some creative thinking and a little help from your accounting department, you might be able to dodge this particular roadblock. Guidroz offers leasing packages to his customers, and even though few of his customers are opting for it, it gives the impression that they have more alternatives.
 

Historic success story: Am
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erican Express, which had focused on just traveler’s checks and money orders, launched its own charge card during the economic slowdown of the late 1950s. Within three months, more than 500,000 cards were in circulation. Do what AmEx did and think outside the box. Longer payment periods, reduced down payment, and rent and leasing options can all give your customers other ways to do business with you.

5. Quantify your ROI.
Selling in a down economy means customers must see a return on their investment, and fast. The quicker they can recoup their initial outlay, the more likely they’ll be willing to sign the purchase order. Knowing your customers’ typical results and being able to predict prospects’ success will bolster your credibility and move savings from pipe dream to probable. 
 

Guidroz is so confident in his company’s ability to reduce its customers’ electrical bills, he says that he offers a prepurchase assessment, as well as a money-back guarantee. He also offers 90-day usage reviews to help customers see the savings in real time. “That’s helped quite a bit,” Guidroz says.
 

Historic success story: Federal Express had a great advantage when it opened for business in the recession of the early 1970s; it was easy to see how faster delivery would affect a company’s bottom line. Make your ROI equally obvious to your customers. Provide prepurchase audits and assessments to assist in quantifying potential savings or earnings.

6. Be patient.
When hard times hit, everyone goes into shutdown. All nonessential expenditures are curtailed, and buyers are terrified to make any move at all. “The scariest thing is not knowing what the future holds,” says Guidroz. Recovery comes slowly as we move from “How bad is it going to get?” to “OK, we can deal with this.” The process is similar to the stages of grief: your customers must move through denial and bargaining before they can get to acceptance and action. The key is to accompany them through these stages, not try to rush them. Be the voice of reason and hope.
 

Historic success story: According to Bloomberg Businessweek, Schaeffer Manufacturing took a huge hit during the Great Depression. Instead of shutting its doors or overextending itself, it waited out the bad times – to a tune of a current $90 million in sales worldwide.

7. Expand your marketing efforts.
You may be thinking that you need to trim the sails and wait out the storm. Forget it; while you’re battening down the hatches, your competitors are on the lookout to steal your customers. In fact, experts believe that advertising was the main factor leading to the success of companies that were able to weather the Great Depression. And while mass-market advertising today isn’t what it was a century ago, certain marketing tactics still work (see “To Market, to Market”).
 
“Marketing is usually the sacrificial lamb when it comes to cutting costs, which is just insane,” says Agilent’s Greenberg. Instead, find ways to market inexpensively, such as social marketing. Tighter budgets can actually be an excuse for revamping your marketing efforts, getting rid of some of the dinosaurs and replacing them with more effective, cost-efficient, and forward-thinking solutions.
 

Historic success story: MTV may not seem like ancient history, but it was the first company to take music to TV in a radio-show format during the recession of the early 1980s. Bringing a familiar product – music – to the masses in a new way proved a winning combination for artists, record labels, and MTV Networks alike. When business is scarce, revamp and increase your marketing efforts.

8. Revisit old successes.
Every salesperson knows that it’s easier to resell existing customers than it is to capture new ones. But somehow, this fact always gets lost in the excitement of stalking “new meat.” When the pipeline is running dry, that’s the time to revisit those customers who’ve already purchased from you and see what else you can offer, says Guidroz. Do they need an upgrade, a new service package, or an expansion to another location? Even small sales add up and can make the difference between meeting your quota and falling short.
 

Historic success story: If there’s a business sector that knows about repeat customers, it’s the tobacco industry. Camel Cigarettes lost a lot of its market share during the late 1920s. Camel’s recovery approach? Hitting customer loyalty hard through advertising and encouraging repeat sales. While your product may not be quite as addictive, what can you do to increase repeat spending? •

To Market, to Market

Yes, it is possible to make sales without marketing, just as you can catch a fish without bait. So when the cost-cutting axe is looking for a place to fall, don’t look to marketing as an easy fix. Instead, use the downturn as a time to reevaluate your marketing efforts and bring them up-to-date.
 

Here are some suggestions for making the most of your marketing dollars.
 

• Cut the fat. “I find that a lot of these [marketing efforts], like trade shows, are dinosaurs
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,” says Bob Greenberg, regional sales manager for Agilent Technologies’s vacuum-products division. Tight budgets can be a great excuse for sidelining some of your team’s previously sacred cows.
 

• Opt for smaller-price-tag items. “Look at low-cost/no-cost efforts, such as social marketing,” suggests Greenberg. Blogs, Twitter, Facebook, LinkedIn, email marketing, and YouTube are all inexpensive and, coincidentally, are the hot spots for B2B salespeople.
 
• Don’t overlook direct mail. John C. Guidroz, distributor for V-Blox, has had great success in initiating a relatively low-cost direct mail campaign. Prospects receive a series of mailings over a period of months, reminding them of the service and warming the ground for a future sales call.