7.3. Prospecting: A Vital Role in the Selling Process
Imagine you decide to build a house from the ground up. After designing your ideal house, of course it would be nice if you could snap your fingers and get to the fun part: watching the finishing touches come together. But before the walls go up you have to make detailed plans and measurements, find your materials, negotiate with contractors, and lay the foundation. All these things require patience, time, and effort, but these steps are absolutely necessary for the project to move forward. Planning and laying a foundation is a little like prospecting and qualifying. Finding leads (or people who might be prospects) is the most vital part of the selling process—you can’t make a sale without identifying the people to whom you’ll be selling (Stone, 2009). In other words, without prospecting, nothing else can happen. Yet, unlike laying a foundation, prospecting does not happen just once; it’s a constant process. Businesses lose some customers every year for a variety of reasons: customers may no longer need the product or service, have the financial means to purchase the product or service, or live or do business in the area, or the business may no longer be open. So, if you haven’t been building your prospect list, you won’t have new customers to replace the ones you lose.
The Value of a Lead
Think of the last time you went to the store to make a major purchase and you started by browsing the products. A salesperson probably approached you with the standard “Can I help you?” and you may have responded with the equally standard “No, thanks. I’m just looking.” Chances are good that the salesperson left you alone after that, very likely assuming you were not genuinely interested in making a purchase. Most people—salespeople and customers alike—are surprised to learn that over two-thirds of shoppers who give the “just looking” response end up purchasing the product within a week (Bressler, 2009). In other words, these customers are valuable leads, and all too often their business goes to a competitor.
Let’s say you are planning to buy a new refrigerator. That’s generally not the kind of purchase you make on the spot; you will probably go online and compare products and prices first. If you tell the salesperson at the first store that you’re just looking, you may then go to a second store and decide you’re ready to buy. As a customer, if the vendors seem more or less equal, you will base your purchasing decision on price, product features, convenience, or a combination of these things. But imagine the salesperson at the first store who took the time to determine your specific needs, wrote down your contact information, and followed up with you. It is very likely they would make a sale. Their products might be quite similar to their competitors’, but if they go out of their way to provide you with a solution, you have a reason to buy from them over someone else.
Now let’s change hats. What does knowing this information mean for you as a salesperson? Most importantly, it means that you should never write off a lead until you are certain they cannot be qualified as a prospect. If you work in a showroom that sells only high-end cars like Lexus or BMW and a potential customer walks in wearing torn jeans and a T-shirt, you might be tempted to mentally disqualify them, assuming they won’t have the money to buy such expensive cars. But appearances are often misleading, and you won’t know whether or not your lead is actually qualified until you ask some specific, qualifying questions. When you realize that a lead is the only thing you can turn into a sale, you also realize just how valuable every lead is.
The Sales Funnel
If you talked to a guidance counsellor when you were applying to colleges, they probably told you to consider several and then apply to a number of schools (more than just two or three) even though you would only end up choosing one school in the end. This is because not all the schools that you apply to end up being a good fit. Sometimes you aren’t accepted, sometimes you are accepted but don’t get an ideal financial package, and sometimes as you learn more about a school you decide it isn’t the right one for you. Whatever the reason, you start out by considering many schools and generally end up deciding between a few. The same can be said of the selling process. In fact, the process is often compared to a funnel. You start out with many leads, and after gathering more information, you come up with a smaller list of qualified prospects. As you communicate with these potential customers and work toward a solution, some will turn out to be more likely to buy than others. It’s common sense to assume that you will have more leads than you have buyers since not all leads turn into customers. The concept of the sales funnel is a helpful way to visualize the process of finding and qualifying your customers and effectively illustrates the value of identifying a large pool of potential prospects. If you don’t bother to find more than a handful of leads, you limit your chances of ever closing a sale no matter how much effort you put into your sales presentation. But wait a minute, you might think, “Isn’t it hugely inefficient to spend time and effort communicating with so many prospects with the expectation that only a handful of those will turn out to be buyers?” This is also true, which is why qualifying and prioritizing your prospects is such an important part of the sales process.
Now that you understand the concept of prospecting and why it’s important, you’ll find the next sections helpful as they will provide you with tools to help you find prospects and qualify prospects.