JUNE 3rd 2009 / IssUE 24

WHY DO PEOPLE SAY YES?The Psychology of Influence

WHY iS SELLing

STiLL A DirTY WOrD?

it’s Time to rewrite the Dictionary

nZ’s e-mag for sales leaders

SALES FOrEcASTing Where to Begin?

NZsM / JUNE 3rd 2009 / 2

JUNE 3rd / IssUE 24

THiS WEEKS MUST rEADWHY DO PEOPLE SAY YES?An exploration of the psychology of influence.

WHY iS SELLing STiLL A DirTY WOrD? Paul Newsom on the definition of selling today and why it’s time to rewrite the dictionary.

nZSM cALEnDAr

TWO MinUTE TOP-UPSALES FOrEcASTing How to start building a forecasting system which looks after many of your long and short term needs.

rESOUrcE cOrnErTHE ricHEST MAn in BABYLOnThe simple secrets for achieving personal wealth.

SALES TrAining DirEcTOrY

THE cLOSE

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ABOUT /

Short and sharp, New Zealand Sales

Manager is a free e-magazine delivering

thought provoking and enlightening

articles, and industry news and

information to forward-thinking sales

managers, business owners and sales

professionals.

EdITOr / Richard Liew

ArT dIrECTOr / Jodi Olsson

GrOUP EdITOr / Trudi Caffell

AdVErTIsING/CONTENT ENQUIrIEs /

Phone Richard on 09 523 4112 or email

richardl@nzsalesmanager.co.nz

AddrEss / NZ Sales Manager, C/- Espire

Media, PO Box 137162, Parnell,

Auckland 1151, New Zealand

WEBsITE / www.nzsalesmanager.co.nz

NZsM / JUNE 3rd 2009 / 3

I used to say that sales people are the most important people in business.

Sometimes this didn’t go down too well with non-sales people. But after working

with many businesses over the years, my views have changed. I am now of the firm belief that it’s not sales people who are the most important people in business, but Sales Managers.

While a good sales person may be able to increase their sales by 25% or 50% in a year, a good sales manager has the potential to increase the sales of a whole team or a whole company by 25% to 50%. And while the poor performance of a single sales person may not be a business killer, the poor performance of a whole sales team certainly can be.

Quite simply the ability or inability of a sales manager gets magnified and the more people in the sales managers’ team, branch or division, the greater their ability to make or break a company.

And while the position of sales manager may have certain privileges, it also comes with huge responsibilities and a lot of pressure. Whether your title is Sales Manager, Team Leader, Branch Manager,

GM or Business Owner, if you’re in charge of the

sales team it is you who is ultimately responsible for the performance of your company’s sales people – not a responsibility for the faint hearted, and not a responsibility most sales people can handle. As many successful sales people have found out, being a good sales person is certainly no guarantee that you will be a good sales manager.

But given the importance of sales managers, how many businesses have a company training or induction program for their sales managers? How many businesses understand the challenges sales managers face or how to support them in their role? In my experience many businesses invest more time on their processes and systems for cleaning their office than for their sales managers and sales teams.

Sound familiar to you? If so it’s my hope that we can provide you, the most important people in business, with some much needed encouragement, inspiration and ideas to help you make the changes New Zealand businesses need is worth more than their weight in gold.

Happy selling!

Richard

NZsM / JUNE 3rd 2009 / 4

T H I S W E E K ’ S M U S T R E A D

ost people will probably associate the words

influence and persuasion with the sales

process. However, influencing – getting

another person to accede to your requests – is at the core

of most soft skills including leadership, negotiation and

teamwork. All of these functions require us, at some stage,

to influence and persuade others.

It may be influencing customers, colleagues, friends – even

our children – to buy, do, accept or believe in something

or someone. The ability to influence others in an ethical

manner is a greatly underrated competency and one that

many of us do not do well. However, new research has

highlighted that persuasion skills can be learnt by almost

any individual. Enter, Dr Robert Cialdini.

If you want to sell anything, influence anybody or motivate

action I urge you to read Cialdini’s brilliant book, Influence,

Science and Practice. Cialdini is a psychology professor

at Arizona State University. He is the most cited social

psychologist on the subject of persuasion in the world.

As the book’s title states, the content is based on science

– Cialdini has examined hundreds of psychological

experiments on persuasion to form his core thesis. But

what’s really impressive is that he actually took three years

off to work as a ‘spy’ in a number of jobs to understand

how his theories held up in the everyday working

environment.

Cialdini’s influencing theories centre on six key constructs

that are easy to learn and apply. They are: reciprocation,

commitment and consistency, social proof, likeability,

authority and scarcity.

Let’s have a brief look at each.

M

WHY dO PEOPLE sAY YES?

The Psychology of Influence

By Rob McKay

NZsM / JUNE 3rd 2009 / 5

rEciPrOciTY

People are more willing to comply with requests (for

favours, services, information and concessions) from those

who have provided such things first. This is the old ‘give

and take’ scenario – if I do this for you, maybe, in the

future, you will do something for me.

This form of influencing is used in many ways – gifts,

concessions and exclusive information are common tools

of reciprocity. One place you see this tactic used is in

supermarkets; merchandisers offer you free food to taste,

you reciprocate by purchasing. The key concept here is that

when giving make it a gift, not a reward! Your actions must

not be seen as coercion.

cOMMiTMEnT/cOnSiSTEncY

People are more willing to be moved in a particular

direction if they see it as consistent with an existing

commitment. An example of the commitment principle is

used in retail sales – a good salesperson will try to get you

to try something on because once you are committed to

trying, you are closer to buying.

People will very rarely go against their own values and

beliefs. Once a person makes a choice, or takes a stand

they will encounter interpersonal and personal pressures to

behave consistently with what they have previously said or

done. Now you can understand why the power of getting a

small holding deposit from a potential buyer works so well

– they are now committed to moving forward.

AUTHOriTY

People are more willing to follow the directions or

recommendations of a communicator to whom they

attribute relevant authority or expertise. For example,

an expert witness talking in technical terms has more

persuasive powers with juries than a lay eyewitness.

A tactic used a lot in advertising is to have recognised

experts endorse products. Having Dr or PhD linked to

a name adds persuasive power. Dan Carter sells a lot of

men’s underwear to women who are buying on behalf

of men. A double whammy here, Dan has authority and

attractiveness (see below). The biggest symbols of authority

are automobiles, clothes and titles.

SOciAL VALiDATiOn

People are more willing to take a recommended action

if they see evidence that many others, especially similar

others, are taking it. We live in a busy world with no time

to fully validate our decisions, so many times we rely on

what others are doing. If many people are doing it, it must

be right – or is it?

Have you ever noticed how a small group will attract a

crowd and a crowd attracts a mob? If a street performer

can get four or five people to stand and watch, I guarantee

there will be 20 or 30 people there within a minute or two.

If two or three people throw money into the hat, many

other coins will follow – that’s why buskers always seed

their violin case with notes and coins.

Here’s a little test you can perform. When next in a

crowded area with a couple of mates have the three of you

all look up into the sky – I guarantee everybody around

you will start doing the same.

ScArciTY

I love this one; it sucks me in all the time. People find

objects and opportunities more attractive to the degree

that they are scarce, rare, or dwindling in availability. Air

New Zealand’s current ‘grab a seat’ campaign plays on this

scarcity principle. Think about the one-day sale or tickets to

a popular concert/event that last sold out in 30 minutes.

The interesting psychology working here is that people

fear loss more than they want gain. Telling someone they

will lose $1000 a year if they don’t take action is more

powerful than promising they will make a $1000 by taking

action. Another tip, numbers are more powerful than time

as it creates competition.

NZsM / JUNE 3rd 2009 / 6

Rob McKay MA(Hons) CMCT is a Business Psychologist and Director of AssessSystems Aust/NZ Ltd.

Visit his website at www.influenceatwork.co.nz

LiKing/FriEnDSHiP/ATTrAcTiVEnESS

Yes folks, beauty does sell. People prefer to say yes to

those they know, like, find attractive or are similar too.

It’s a proven fact that voters will be more swayed by an

attractive, friendly candidate than policy. I’ll tell you one

thing, there were many election billboards littering out

streets in the recent election campaign that helped people

to vote against a candidate!

Apart from people liking you, people will also be moved

to say yes to your requests if you show them (naturally and

sincerely) that you like them. All of us are suckers for flattery!

MEASUring, PrEDicTing AnD LEArning inFLUEncE

The science of influencing can be learned; however a

person’s ability to influence successfully is heavily driven

by their personality. If they don’t have personality traits

like resilience, optimism and assertiveness, no amount of

training will make a silk purse out of a sow’s ear!

Personality can be measured. Influencing skills can be

taught – you can’t have one without the other. So, if you

are hiring or developing staff that need influencing and

persuading ability (salespeople, outbound call centre

operators, leaders, managers and marketers) it’s important

to ensure they have the innate personality characteristics to

drive this competency.

Assessing them through a valid personality profile will

give you this important information. Then, introducing

them to Cialdini’s six core principles of persuasion will be

analogous to putting a strong sea breeze into their Kevlar

racing sails.

The science of influencing is very powerful. Those who can

understand the theories will be better equipped to generate

change and growth in their businesses. But a word of

caution – your influencing tactics must be ethical; people

who use unethical strategies may win the first round, but

will lose the match.

http://www.businessmentors.org.nz

NZsM / JUNE 3rd 2009 / 8

Why is Selling Still a Dirty Word?

By Paul Newsom

It’s Time to Rewrite the dictionary

I often begin sales workshops by asking the question

“What is selling?” We always end up with several

different definitions, and some better than others in the

context of the business.

Stop reading for a moment and write down your definition

of selling.

Selling can and should mean different things to people

who sell. The definition needs to consider the nature of the

sale. It is interesting to note that the origin of the word sell

is Sellan, the old English word meaning ‘to give’.

A quick dictionary search on Google comes up with the

following definitions:

To exchange or deliver for money or its equivalent•

To persuade (another) to recognise the worth or •

desirability of something

A deception, a hoax•

Sell down the river (betray the trust or faith of)•

NZsM / JUNE 3rd 2009 / 9

Paul Newsom is Learning & Development Manager at the Rev Sales Network. Visit www.rsn.co.nz for more information.

We don’t need to go into three and four, as they’re outside

our meaning of the word in this context. So let’s look at the

first two definitions.

Firstly, exchanging money for goods or services is not selling.

This is the definition of ‘sale’ which is the transactional

outcome of the process of selling.

Secondly, those selling commodity product to repeat buyers

in a competitive market are likely to need good persuasive

skills, but will hopefully not be using persuasion to get

people to buy something they have no need for. The best

persuasive sales people will leave the buyer thinking they

have bought well, rather than been sold to.

In a complex sale however, a strategy of persuasion is

unlikely to result in long-term success. I think of selling

as ‘the process of helping people make quality buying

decisions and developing mutually beneficial and

profitable long-term relationships’.

It is about helping the client succeed, from which you

make sales, rather than persuading people to buy. There is

a big difference.

How well does your definition of selling support the

desired sales culture of your business or organisation?

I generally find that wide variation of opinion on what

selling is within a team will be a good indicator of a

dysfunctional sales culture.

A great exercise is to ask your salespeople, “What is

selling?” If your salespeople cannot present a consistent

answer it’s highly likely that your customers are receiving an

inconsistent buying experience from your company.

In any context, selling is something you do with or for

someone, not something you do to someone.

A great exercise is to ask your salespeople, “What is selling?” If your salespeople cannot present a consistent answer it’s highly likely that your customers are receiving an inconsistent buying experience from your company.

NZsM / JUNE 3rd 2009 / 10

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FRI 3 JULYTHU 2 JULYWED 1 JULYTUE 30 JUNE

MON 29 JUNETHU 25 JUNEWEd 24 JUNE

TUE 23 JUNEMON 22 JUNE

WED 17 JUNETUE 16 JUNEMON 15 JUNEFRI 12 JUNE

FRI 26 JUNE

sUN 28 JUNE

SAT 27 JUNE

sUN 21 JUNE

sAT 20 JUNEFRI 19 JUNETHU 18 JUNE

sUN 14 JUNE

sAT 13 JUNE

SUN 7 JUNE

SAT 6 JUNE

SUN 5 JULY

SAT 4 JULY

NZsMCALENDAR

MON 8 JUNE

THU 4 JUNEWEd 3 JUNE FRI 5 JUNEManaging Difficult CustomersZealmarkAuckland

Key Account ManagementDavid FormanWellington(8-9 June)

Advanced Sales DevelopmentDavid FormanAuckland

THU 11 JUNEWEd 10 JUNETUE 9 JUNERSN Seminar # 3Rev Sales NetworkAucklandAdvanced Sales DevelopmentDavid FormanAucklandCustomer ServiceZealmarkAucklandColdcalling WorkshopTop Achievers sales TrainingAuckland

Sales Skills Level 3EMA NorthernAucklandProspecting David FormanWellingtonAdvanced Serious SellingGeewizChristchurch

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sales skills 2Zealmark GroupAucklandCustomer ServiceDavid FormanAucklandTelephone sales skillsEMA NorthernAucklandExceeding Customer ExpectationsGeewizWellington

Customer ServiceDavid FormanAucklandSales DevelopmentDavid FormanWellington (15-18 June)Sales DevelopmentDavid FormanAuckland (15-18 June)Networking WorkshopTop Achievers sales TrainingAuckland

Managing Through LeadershipZealmark GroupAucklandsales BasicsGeewizAucklandHit the Road Running Sales SeminarTop Achievers sales TrainingHamilton

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Cold Calling & ProspectingTop Achievers sales TrainingAuckland

Prospecting & New Business DevelopmentDavid FormanAuckland

Sales ManagementDavid FormanWellington

Sales ManagementDavid FormanWellington

Sales ManagementDavid FormanWellington

Sales ManagementDavid FormanWellington

Business NegotiationZealmark GroupAucklandAdvanced Serious SellingGeewizAucklandHit the Road Running Sales SeminarTop Achievers sales TrainingWellington

Do you identify with this scenario?

Two weeks into the month and the CEO walks into your

office looking pensive.

“How was the board meeting?” you ask.

“The chairman wants to know whether we will hit our sales

budget this month. What should I tell her?”

You knew this was coming but foreknowledge doesn’t

change that sinking feeling you experience. Dare you say

“Yes”? Can you bear to say “No”?

“I’d better check around before I answer that,” you respond.

“Get back to me by 10am tomorrow,” says the CEO.

The equation: 15 days to go, MTD sales $200,000, budget

$500,000, sales achievable at the present rate $400,000.

What have your reps got in the pipeline? A quick email

goes out looking for the instant update, and the answers

trickle back. They say they can pull in another $250,000.

$450,000 is not good enough for you to take back to the

boss. You’ll be in the gun.

But do you believe them? What if they are too optimistic?

What if you tell the boss $450,000 and they are just

fudging to buy time? At $400,000 your job is on the line.

How can you find the truth? Can you pull in a couple of

favours from customers? You took Joe fishing last month

and he caught the snapper of a lifetime. He owes you. If

you can talk him into placing that big order this month

for delivery over the next two months, you might just get

away with it.

You know you’re just fudging it yourself and the chances of

getting lucky next month are not good but things are tough

out there. What is the real problem?

If you have ever found yourself in this position, you need a

better answer.

Your problem is that your sales forecasting system does not

look far enough ahead. It does not tell you the truth early

enough for you to act and make a difference.

You need a forecasting system that gives you two months’

notice of a bad month so that you can get your sales team

working on the things that will fill up the bucket.

LET’S THinK ABOUT THE THingS WE KnOW:

Making a sale requires real work; the process has to be

followed, both for you and the customer.

There are quite a few stages in the process, from finding a

prospect, putting together a quote, getting the order and

starting the work. Short cuts don’t work.

Sales teams cherry-pick their prospect lists for the easy sale

and look dumb when they have to chase the harder ones.

Salespeople are over-optimistic at the start, and good at

excuses when it turns to custard.

So can you build a simple sales forecasting system that will

not only let you know in an instant what your team will close

this month, but be alerted to problems months in advance?

The good news is YES. You can solve your problem by treating

every sale as a project in its own right. Then you can track and

measure your progress through the steps to the sale.

Next issue we’ll look at a simple spreadsheet model that

will let you keep track of sales prospects for each territory

or representative, and when you add them together you

can start to manage the work that will deliver the sales. If

things are going in the wrong direction you will get advance

notice and you can help your people manage their activity to

NZsM / NOV 12TH 2008 / 11

SALES FOrEcASTing THE SALES MAnAgErS DiLEMMA!Part 1 of a 3 Part Series By Michael Taplin

T W O M I N U T E T O P - U P

NZsM / JUNE 3rd 2009 / 12

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This celebrated bestseller offers an understanding

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This is the original classic that reveals the secrets to

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management favorite is still the best!

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THE ricHEST MAn in BABYLOnBy George S. ClasonPublished by New American Library

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Michael Taplin is a business mentor and strategy consultant with special expertise in sales forecasting. You can visit his website at www.bizlearn.biz.

LET’S THinK ABOUT THE THingS WE KnOW:

Making a sale requires real work; the process has to be

followed, both for you and the customer. There are quite a

few stages in the process, from finding a prospect, putting

together a quote, getting the order and starting the work.

Short cuts don’t work.

Sales teams cherry-pick their prospect lists for the easy sale

and look dumb when they have to chase the harder ones.

Salespeople are over-optimistic at the start, and good at

excuses when it turns to custard.

So can you build a simple sales forecasting system that

will not only let you know in an instant what your team

will close this month, but be alerted to problems months

in advance? The good news is YES. You can solve your

problem by treating every sale as a project in its own

right. Then you can track and measure your progress

through the steps to the sale.

Next issue we’ll look at a simple spreadsheet model that

will let you keep track of sales prospects for each territory

or representative, and when you add them together you can

start to manage the work that will deliver the sales. If things

are going in the wrong direction you will get advance

notice and you can help your people manage their activity

to correct the problem in good time.

It’s not magic; it can be done by any sales manager, and it

works as well as sighting in a rifle helps you hit the bull’s eye.

Next issue: Part Two in our look at sales forecasting – How

to create a simple and accurate forecast for your business.

NZsM / JUNE 3rd 2009 / 14

NZsM / JUNE 3rd 2009 / 15

“

“First you fuel the desire, then the desire will fuel youNapoleon Hill, Author “Think And Grow Rich”

Competing with “E”ase – the new competitive edge for today’s market place

How to create better strategic alliances

Sales Forecasting Part Two: How to create a simple and accurate sales forecast for your business

Plus: We talk to performance development coach Adam Sands about developing sales cultures in large businesses

Plus: Will you be the next NZ Sales Manager Wineplus Winner?

Have you subscribed to New Zealand Sales Manager? It’s free!Simply visit www.nzsalesmanager.co.nz to get a copy of New Zealand Sales Manager delivered

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