Over 40 years ago I learned a simple marketing axiom that made good business sense to me: Put your client's needs ahead of your needs, and you will get what you want. It kicked me into taking action with overhauling our company's sales process.
I wanted to get a faster commitment than the 8-10 hours it was taking me back then to make a sale, and I wanted to increase my sales volume. My premise was that if I could speed up the process of earning a client commitment, I could sell many more jobs in a year's time. So what would it take on my end for a prospective client to give me a retainer check and take them off the market quickly? I thought about that question quite a bit and concluded that that they needed to feel comfortable with (1) the design solution process and (2) the price of their new kitchen.
So I decided to take a risk, and help prospects accomplish those two objectives, during a revamped home consultation that would last two to three hours rather the customary one hour that my training called for. The key was having them collaborate interactively with me on developing one possible design solution and a budget for that design concept.
What a difference that change made! By helping prospects "own" the plan and the price in a totally transparent conceptual process, they became clients in 1/3 to 1/2 the time, my sales volume doubled almost overnight, and my gross profit margin grew from 35% to 51%. As a sales designer earning a commission based upon a percentage share of the gross profit, I ended up trebling my annual income.
That people could make an important buying decision – without me even taking measurements, drawing a floor plan and elevation to scale, "stick-pricing" the cabinetry, and/or developing an exact fixed price – was a stunning revelation! This new sales process was evidently such a meaningful educational experience for prospects that I was perceived as an impartial consultant and a better value for their projects, despite ultimately charging 30-40% more than my competition.
Success Through Social Interaction
I was recently reminded of why this revised sales process was so transformational for me when reading a new book, Give and Take by Adam Grant. Grant is an organizational psychologist and Wharton Business School professor who spent the last 10 years researching why helping others will drive one's success.
According to conventional wisdom, highly successful people have three things in common: (1) motivation, (2) ability, and (3) opportunity. But Grant's extensive research discovered a fourth factor. Maximum success also depends heavily upon how we approach our interactions with other people. There's a choice to be made. Do we try and claim as much value as possible during these social interactions? Or do we contribute value without worrying too much about what we receive in return?
Grant compares the three fundamental styles of social interaction: takers, givers and matchers. Takers have a distinctive signature; they get more than they give. In business, that materializes into an adversarial approach where there are only winners and losers. That, incidentally, characterizes the traditional sales process for which I was trained and remains the prevalent one even today in the kitchen/bath industry.
Givers, on the other hand, pay more attention on what others need from them…helping, mentoring, collaborating, sharing credit and making connections. They are a rare breed in business. And matchers, as you may imagine, try to preserve an equal balance where their social interactions are based upon the principle of fairness. Many businesspeople seem to adopt this third style of reciprocity.
Grant's research concluded that givers end up at the top of the success ladder. “By operating as a giver, you create value for yourself. We too often stereotype givers as chumps, but they turn out to be surprisingly successful,” he wrote.
That was my experience when I gave out design ideas to prospects, and shared realistic budgeting numbers for each product and labor category of cost during that expanded home consultation meeting so many years ago. I’d been trained never to give up ideas until the design was crystallized, the estimate completed and the final presentation made. But clearly, the speed and transparency by which I delivered a "design solution" and "project price" in the prospect's home – within days of meeting them – generated value for both my clients and me. Though I hadn't thought of myself as one at that time, being a giver fueled my sales success.
The Ripple Effect Of Giving
Grant continues: “When givers succeed, it spreads and cascades. Whereas when takers succeed, someone loses. Givers succeed in a way that creates a ripple effect, enhancing the success of others around them.” That, too, was my experience when I decided in the 1980s to expand my business into three additional locations.
Assuming the mantle of Head Trainer, I leveraged the success of this new sales process by teaching others to use it. A five-week, 10-session adult evening education class was developed so people with some sales experience in other industries, and a flair or interest in design, could learn whether they might be successful as a kitchen/bath sales designer. Fourteen individuals graduated from this course, completed a three-month on-the-job training program, and within another year or two became big sales producers at one of the new branch showrooms. In today's dollars, they averaged $845,000 in annual sales at 51.5% gross margins. Being a giver fueled the success of my business expansion.
When I started SEN in 1994, I shared the psychology and mechanics of this successful sales process with dealer/members. Pretty soon, in SEN conference roundtable meetings and workshops, they were trumpeting success with the sales process and advising their fellow members how to implement it. Indeed, members shared their budgeting spreadsheets and developed the process further into a three-column "Good-Better-Best Selling System," making it even more effective. As a result, they drove our group's gross purchases from our Vendor Partners to new heights and the subsequent rebates paid out to members into the millions of dollars. Being a giver fueled the rippling success of the buying group business.
Now that rippling effect as a giver is going through an even bigger, more exciting evolution – one that I believe will have explosive, imminent growth benefits for all parties in the kitchen/bath industry's ecosystem. For the last three years, SEN has been collaborating closely with an accomplished software development company to create the first automated kitchen/bath dealer operating system of best business practices that connects on the front end with CAD and Quickbooks on the back end.
As the NMS centerpiece, the SEN Good-Better-Best Selling System will enable dealers to interactively work with their prospects to transparently shop within their operation, empowering prospects to put together a kitchen or bath project just the way they like it at a cost that can afford.
Indeed, this is a ground-breaking technology that should rally all industry players behind its development because it unites all aspects of the kitchen/bath industry and advances institutional growth.
Ken Peterson, CKD, LPBC, is president of the Chapel Hill, NC-based SEN Design Group. For more info about the Good-Better-Best Selling System, please contact Peterson at 1-800-991-1711 or [email protected] Peterson also welcomes comments, questions or concerns.