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John Henry Patterson, Sales Pioneer

By james b. crawford

The greatest salesman of all time was born nearly a century and a half ago on a farm in Ohio. His name was John Henry Patterson, and if he were alive today he’d fire most of the salespeople reading this article. Brilliant, innovative, dictatorial and mercurial, Patterson is best remembered today as the founder of the National Cash Register Company.

More significantly, but virtually forgotten, this mustachioed, bespectacled whirlwind of a man invented modern selling. The sales training manual, canned presentation, protected territory, and quota system were all products of Patterson’s fertile mind. So were sales meetings, direct mail, testimonials, industrial advertising and publicity.

So numerous were his contributions and vast was his influence that Patterson may rightly be called the father of professional selling. And perhaps even the father of the modern American corporation, for many of those whom Patterson trained went on to found corporations such as IBM and Burroughs.

Single-handedly, and often opposed by business associates and the very salesmen who benefited from his genius, Patterson created the greatest selling machine this country has ever seen. It may even be said that no company today approaches the marketplace efficiency that Patterson’s NCR achieved in its heyday. Too frequently the practices he pioneered are preached but not followed.

Rest assured that wouldn’t be the case if Patterson still walked the earth. Many a head – even illustrious ones – would roll. But sales productivity would soar to peaks not seen in this country since the turn of the century.

Sales Professional First And Foremost

Few companies have had more inauspicious beginnings than NCR. When Patterson, at the age of 40, bought controlling interest in the failing Dayton, Ohio, firm in 1884, there was really no market demand for cash registers. Fewer than 400 had ever been sold. There were several reasons for this. Few retail businesses, the targeted market, appreciated the value of a device they viewed as a kind of Rube Goldberg machine. Clerks, who felt the cash register represented a mechanical intruder sent to spy on their integrity, were openly hostile to salesmen who came through the door lugging a demonstration cash register. Poor craftsmanship sometimes forced the return of thousands of dollars worth of machines.

Finally, there was the problem of the salesmen themselves. Slovenly, disorganized, ill-prepared and uncommitted to either the company or product, they almost seemed to stand in the way of sales.

These problems would have sunk most entrepreneurs with a fledgling business, but not Patterson. He was one of those rare human beings whose vision and resoluteness enabled him to divine solutions where others saw only a quagmire of frustration.

An anecdote from Patterson’s life illustrates these qualities. Years after NCR was well-established, Patterson was told by legal advisors that his plans to incorporate NCR in Ohio would be thwarted by state law unless they reduced the number of people on NCR’s board. The wiry Patterson thundered: “Don’t change directors. Change the law.” They did.

It was with the same single-mindedness that Patterson set out to transform NCR. A salesman first and foremost, he believed that improving salesmanship was the surest path to success, and that was where he concentrated his efforts. Just as he could command his attorneys to change a state law, so Patterson set out to change the art of selling.

Creating A Demand

Patterson was one of the first in the country sold – through personal experience – on the value of the cash register. A pair of registers he bought for his retail store cut his debt from $16,000 to $3,000 in six months and helped him show a profit of $5,000. It was that experience that led him to buy the company.

But Patterson was virtually alone as a true believer. So when he bought the company that would become NCR, his first task was to create awareness of and then demand for the product.

Patterson did this in a way that stunned the business community of the day: through the heavy (even relentless) use of advertising, direct mail and publicity. In so doing, he raised advertising and promotion to unprecedented levels of sophistication, and created models still in use today.

Often it was a process of trial and error. In his first direct mail effort, Patterson spent thousands of dollars developing a circular for 5,000 prospects. “It was a good piece, but it did not contain a picture of the cash register,” said Patterson. Not one response came in to NCR.

Still convinced of the value of direct mail, Patterson continued his experiments, learning as he went and distributing circulars by the millions. Some were in letter form, some carried pictures, others dramatized the use of the cash register. Many were in the form of publications directed to specific groups of retailers. To thwart antagonistic retail clerks, Patterson devised the idea of using plain envelopes, and often had the pieces mailed from cities other than Dayton.

In an inspired moment, Patterson hit on the idea of incorporating praise from satisfied customers in direct mail. These testimonials proved among the strongest cases ever devised to sway prospects. They were living arguments to buy.

Patterson spent a fortune on paving the way for his sales force through the mail. Stockholders and employees tore their hair out at the expense, and the post office had to hire additional postal clerks just to handle the influx from NCR mailings.

Not content to rely on direct mail, Patterson turned his attention to print advertising. At the time, advertising was most notable for its stuffiness, reliance on baroque graphics and lengthy, tedious copy. Patterson did for advertising what Frank Lloyd Wright did for architecture – simplified it and made it easier on the eye. Not incidentally, he vastly improved its effectiveness.

Patterson’s motto for NCR ad copywriters was “be direct and simple.” Copy was kept brief and to the point. Ads were printed in plain type styles and were broken up with ample blank space. Patterson liked pictures galore in his ads, provided they were pleasant, upbeat and “something out of the ordinary” to attract attention.

In conjunction with direct mail and print advertising, Patterson also developed the industrial publicity release. “Business is news,” he believed, and so hired publicists to generate articles by the score on NCR products and activities.

In the end, Patterson’s “wild ideas” about promotion were upheld. Prospects who had never before heard of the cash register, let alone NCR, were regularly bombarded with a cleverly coordinated mixture of direct mail flyers, print ads and NCR articles. Those who had previously been unaware of the product suddenly began to develop a need for it.

Unfortunately, the sales force wasn’t always in shape to take advantage of Patterson’s ingenious efforts. Many knew less about NCR products than did the copywriters!

The First Modern Sales Force

Early on, Patterson was concerned about the quality of sales, and so – in true Patterson style – he decided to learn firsthand what was happening in the field. In a period of 51 days he visited sales offices in 50 towns and cities. What he found appalled him.

“One half of our salesmen are so ignorant of their product that they will actually prevent a man from buying, even though he wanted a cash register,” he said. Returning to Dayton, he proceeded to gather the sales talks of NCR’s most successful salesmen, writing up every known selling point for the cash register. The document became one of the first canned sales presentations, the NCR Primer.

Patterson made it a requirement that all salesmen learn the 450-word document by heart. Many of the older salesmen balked. When Patterson discovered their resistance, he implemented tests – those who failed or refused to memorize the Primer were fired. The remainder saw their sales soar. Reason: For the first time ever, they had a consistent presentation that covered all the important features and benefits of their products.

The Primer was soon followed by the Book of Arguments, which later developed into the NCR Manual, a compendium of answers to every kind of question a prospect might ask. The Manual was the first-ever systematic approach to handling customer objections. It also discussed topics such as introductions, first interviews, critical sales situations, and closing arguments. Like the Primer, it was drawn from the minds of the best NCR salesmen and compiled, again, with the goal of establishing consistency.

Many salespeople today would benefit from the wisdom of the NCR Manual. Always it had one objective: to make the prospect understand the proposition, not merely to batter and cajole him or her into placing an order or to win in a series of arguments – still major stumbling blocks in the 1990s.

The Birth Of Sales Training

Providing the Primer and Manual was one thing; ensuring that salespeople would commit the techniques outlined therein to memory another. Even with these marvelous tools at their disposal, many balked at learning. It must have seemed to John Patterson that time and again he had to drag mule-headed salespeople to a trough that brimmed with milk and honey.

While attending the 1893 World’s Fair in Chicago, Patterson stopped off at the NCR display booths and quizzed the young salesmen. To his astonishment, hardly any of them knew what they were talking about – despite all the sweat he’d devoted to creating the Primer and the Manual.

Patterson promptly hauled the reps off to a hotel room for a training session. This class was nothing more nor less than a review of the most basic Q&A’s about NCR products – material drawn straight from the Primer and Manual. Patterson was so delighted with the results of the impromptu session that he decided to inaugurate training schools for all of his salespeople.

The first sales training school was opened in Dayton the following spring. Though based on the timeworn teacher-pupil format, the classes were as exciting as Patterson himself – a man who once deliberately shattered a water pitcher on a podium to get the audience’s attention.

With illustrations and demonstrations (and a good bit of Pattersonian drama tossed in), NCR sales training instructors coached salespeople on the very modern concept of thinking in terms of the prospect’s needs rather than in terms of the product. These training sessions were really classes in the art of communication, of understanding prospects and making sure they understood the sales message.

This was a hot topic with Patterson. He was often quoted as saying that fully one half of all lost sales could be attributed to the salesperson’s failure to communicate. The erring sales rep might fail to clarify a point, talk indistinctly, make confusing claims or in some way fail to relay his own mental picture to the prospect.

Patterson rectified the problem of poor communication by teaching salespeople to listen to prospects. They were taught how to modify set sales presentations depending on the type of customer and the type of sales resistance showed. Patterson even hired elocutionists to teach sales agents to speak like masters of the stage.

A firm believer in “teaching through the eye” – using charts. graphs, drawings or any other visual aid to get a point across to his sales force – Patterson told salespeople to use the same technique with prospects. Sales agents were schooled in how to “illustrate” a presentation on a scratch pad while they talked about cash registers. Later, outline charts were printed on the pads, which the salesman would complete as he developed his presentation.

Thus was born the use of graphics in the sales presentation, an idea used by many but still scorned by some salespeople nearly 100 years after Patterson developed it.

The salesmen turned out by the NCR training school were a well-honed lot. Estimates made at the time show that this training was directly responsible for doubling business in the first year.

The Reward System

While Patterson demanded much of his salesmen, he gave much in return. Many of his creations, such as the sales convention, the protected territory and the quota system, were vehicles for rewarding salespeople as well as for increasing productivity.

Patterson was among the first to recognize the value of brain-storming sessions among salespeople. As a result, he decided to conduct regular sales conventions where agents could exchange ideas on selling. In an “every man for himself” era, this was a revolutionary concept. In time, the conventions also provided the opportunity to recognize and reward top achievers.

Patterson developed the protected sales territory in order to attract and keep the best salesmen. In the days B.P. (Before Patterson), salesmen commonly “milked” an area, and then moved on – often into a city or region occupied by other cash register salesmen. Needless to say, this chaotic habit of raiding one’s colleague caused a lot of bickering, turnover and reduced productivity.

Patterson’s solution of the protected sales territory is something every salesperson takes for granted today. In return for this guarantee, NCR agents had to live up to another of Patterson’s creations, the sales quota, the first effort to obtain measurable results in selling. And they had to try another then unheard-of practice – returning, after a period of time, to customers who had already bought from NCR to try to sell to them again.

Returning to an old customer, a technique Patterson called “using the user,” upset many salesmen, who were convinced it was impossible to sell twice to the same prospect. As usual, Patterson was right and the objectors were wrong. Not only did past customers prove a fertile field for new sales, they were also a source of testimonials for advertising and promotions.

Patterson’s Significance Today

It’s all fine and well to pay tribute to a man like Patterson. Certainly sales professionals and sales managers owe him a debt of gratitude. But after this laudatory display, they would do well to go back and review Patterson’s contributions. Not only were his selling techniques the most sophisticated of his day, they are – in combination – more advanced than anything practiced today. Nobody is this sophisticated now.

Billions are spent on advertising, direct mail and publicity, but rarely are these tools used as effectively as the cohesive triad Patterson forged. Salespeople still balk at learning product knowledge cold, and fail to communicate with customers. Though territories are parceled out and quotas maintained, day-to-day sales performance is not monitored as closely as it was at Patterson’s NCR.

It’s a pity, considering the rich heritage John Henry Patterson left to the sales profession. Perhaps more than any other American in history, he is responsible for raising the consciousness, self-image and public image of salespeople. He taught that good salespeople are made, not born. Patterson transformed an often-ridiculed job into an honored profession, and gave salespeople the skills to survive in this toughest of all callings.