Attracting full small business relationships (business + owner + employees) can increase relationship profitability 300% or more and increase cross sells to 15 or more products.  According to small business banking specialist Nick Miller, a clearly defined and well-executed “mixed-household” strategy that integrates a bank’s retail and small business strategies is vital to attracting full small business relationships.  Miller will speak on “mixed-household” strategy at the Retail & Small Business Banking Conference during the session, Capturing the Full Small Business Relationship.

“The potential impact on results is clear yet many of the opportunities to leverage small business banking relationships for driving broader product sales and increasing retail profitability are lost or missed in most banks.  In over 50% of small business relationships, owners and employees bank elsewhere,” contends Miller.  “Mixed small business households can be worth $10,000 a year to more than $24,000 per year to banks that are able to capture most or all mixed-household relationship elements.”

During the session, Capturing the Full Small Business Relationship, Miller will focus on:

• Mining customer databases
• Fully assessing personal and business payment cycles
• Broadening the conversation from the current relationship to an expanded relationship

For more information about the Retail & Small Business Banking Conference, register for the event, and attend Miller’s presentation, Capturing the Full Small Business Relationship, please go to http://www.nyba.com/education/2010-Retail-Landing.html.

About Clarity Advantage: Business banking consultant Clarity Advantage helps banks generate more profitable relationships faster with small and medium-sized companies, their owners, and employees.  Clarity consulting, communications, sales tools and training help banks recruit and deploy sales team members, choose their best business and consumer prospects and clients, then approach, engage, sell, expand, and retain relationships. Clarity also assists banks with consumer sales and cash management sales. Clarity clients have posted increases in household penetration, cross-sells, deposit volume, and loan volume.  Visitors to Clarity’s website, http://www.clarityadvantage.com, can subscribe to “The Weekly Sales Thought,” a free eNewsletter and podcast focused on business-to-business selling and sales management.

Contact:

Karen Tunks

Clarity Advantage

980-939-2112

karen.tunks@clarityadvantage.com

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I once listened to actor Peter Falk, star of the classic TV detective show, “Columbo,” tell a story about his efforts to break into show business in the 1950s. Curious to know what ‘real actors’ talked about, Falk followed three famous actors from a theater to a nearby restaurant, straining to hear their brilliant exchange. The three took a booth. There were no close seats. Falk sat at the counter, his head turned awkwardly to hear. The room was loud. He could hear only their last words as they rose to leave: “I’m putting my money into real estate in California. That’s what Bob Hope is doing.” So this was what famous actors talked about?

Many of us face the same problem when we’re calling on prospects and customers we consider “out of our league” by virtue of age, income, experience, cultural differences, or position. We’ve not sat in their chairs. We don’t know what they talk about. The result, our sales conversations seem cold, matter-of-fact, stilted, or awkward. We feel we don’t belong. We can’t engage “peer to peer.” We can’t establish meaningful rapport.

What’s the remedy? Make five friends. Five friends just like the people you want to call on and feel comfortable with. Five friends you can hang out with, listen to, address questions to.

Notice, I didn’t say, “five friends who can refer you to their friends,” or “five friends who might be prospects for your services.” Just “five friends” from whom you need nothing for your business.

So, how to do that? Well, you could follow fresh footsteps like Falk. Or: Find an overlap – your world and theirs – where you can engage them as peers. Fund raisers. Arts organizations. Community activities. Business associations. If you’re a parent, school activities and youth sports activities. Church. Your own schools’ alumni networks. Business lunches with speakers they go to hear. Civic organizations.

As you work with them, listen…. What do they talk about? As you become more familiar, ask them about their families, their business challenges, concerns, successes, what they’re reading – the same questions you’d ask friends. Develop a vocabulary, a set of knowledge and stories, so they are comfortable accepting you in their conversations and you are comfortable participating.

That comfort and the confidence that comes from your five friendships, will enable you to engage your target prospects (remember, the ones who are just like the five friends?) more easily. You’ll know what to talk about.

In which we distinguish between open questions and leading the witness with questions that bias or restrict the information we hear from clients.

As experienced sales people, we would ALL say that we ask open questions to learn about our clients, right?

Recently, I visited with a prospective client. First visit for me. We’d become comfortable with each other through our telephone conversations and I felt both excited about our planned discussion and at ease as I sat down in her office. Glancing around, I noticed several family pictures on a nearby bookcase including a portrait of two boys together. I said, “They’re handsome. Are they your sons?”

“No,” she replied, smiling and gracious, “they’re my grandsons.”

“Very nice,” I replied, quietly squelching the accusatory voice in my head that called to me.

Rewind the scene and imagine a different outcome. I sit down, I see the pictures, and I say, “They’re handsome. Who are they?”

Her answer might then have been something like, “They’re my grandsons. This one is Bob. That’s Charlie. They’re six and eight years old, and full of energy. They are a hoot! I’m a proud granny!”

Different, right? (A good answer here would be, “yes.”)

Segue to a different scene. In this one, yours truly (the handsome, balding entrepreneur – TA DA!) is the customer, sitting in a bank branch, speaking with a small business banker about our banking situation. She says, “So what is not quite the way you like it in your current banking relationship with Bank S – not good service, branch not convenient, rates not right?”

I replied, “Well, not exactly. While it’s true that our current branch doesn’t have the expertise on site that we think we need, we’ve just grown to the point …. blah, blah, blah.” I almost felt like I was defending myself.

Rewind the scene and imagine a different outcome. I sit down, we start speaking, and she asks, “So how have things gone with your current banking relationship?” …… and STOPS TALKING.

Different outcome again, yes?

In both cases, the questioner “led the witness,” embedding an expected answer in the question, changing what could have been an open question (drawing out information) to a closed question (confirming information).

To ask truly open questions, we phrase questions neutrally without including potential answers.

For example, contrast, “How was your day?” with “Did you have a challenging day?” The first is an open question; the second leads the witness.

Contrast, “How has your sales force been performing?” with “Has your sales force been performing well?” The first is an open question, seeking information; the second leads the witness.

And contrast, “How do you ask questions?” with, “Do you ask primarily open questions?” Again, the first question is an “open question” (seeking information in an unbiased way) and the second is closed (leading the witness).

Clients can hear the difference, just as I could when I was the prospective client for the bank. When a sales person asks a witness-leading question, client tail feathers and antennae go up; we’re ready to protect and defend and object because we have learned that what comes next is a pitch. So, we start objecting early. And, we give shorter, more direct answers because the witness-leading questions limit the scope of our replies.

There are many times in conversation that we want to ask questions that are closed or confirming, when we want a “yes” or “no” or specific answer. The trick is to keep them straight, use them strategically, and not lead the witness when we want information.

Each time I sat in his office, a small bronzed desk plaque sneered at me.

“Do not confuse effort with results,” it hissed, securely bolted, passive, dead center front on his desk, 30 inches distant. Whatever the topic, the plaque stripped the varnish away. “Let’s look… at what you’ve d o n e.”

Segue to… a business gathering. You’re mingling with others. Someone turns to you and says, “Hello, I’m Fred Smith from Amoximated Company. What do you do?” You don’t know Fred, you don’t know what’s important to him or what he’s listening for. How do you respond?

With a result. The desk plaque’s legacy. You could say:

(1) “Hello. Fred, I’m a senior relationship manageer at ABC Company based here in the city. I manage our major account relationships in the consumer packaging industry. I work with a team of people who bring expertise from several important financial and technical disciplines to help our clients manufacture more efficiently.”

or..

(2) “Hello, Fred. I work at ABC Company. I help consumer packaging companies reduce manufacturing costs five to ten percent.

The first one is an “EFFORT” description — a job title and job description, bland, passive, pablum. The second one is a RESULT — crisp, unapologetic, provocative. If Fred wants more discussion, the starting line is bold and clear. It begs the question, “Really, how do you do that?”

Listen, next time you’re mixing with others. What do you hear? Effort or results? “I sell office equipment. I’m a corporate banker. I’m an asset manager. I sell ball bearings. I’m a senior accountant at Knight and Day.” It’s all “effort” and job description.

To stand out, focus on your results. The benefit statements of you. And, if you can’t prove quantitative results, focus on how you help others achieve them. For example: The qualitative result, “I help business owners operate their companies more efficiently,” is stronger than the job description, “I’m a branch manager” or “I’m a Business Banker.”

Do not confuse them with your effort or your job title. Focus on your results.

Our firm, Clarity, is in the process of upgrading and expanding the company’s IT infrastructure to support our plans for the next five years. The upgrade will include hardware, software, and network management services.

As we listen to various firms describe their approaches to our situation, we are somewhat baffled by terminology, product names, and the scope of services.

At one level, as we think about buying the tangible products (hardware, software) proposed by the prospective vendors, we find ourselves wondering:

• How much value will we get if we buy these products?

• How soon will we get it?

• How sure a bet is this?

The differences between the products are small and, for us, difficult to understand. The vendors are having a tough time quantifying and differentiating their value in terms of these tangible products.

When they speak about their services or “intangible products,” we’re also asking: “What’s it going to be like to work with these guys?” And, to date, when we’ve asked that question, the answers have NOT been comforting.

Ted Leavitt, one of the deans of marketing in the United States, once wrote: “The most important thing to know about intangible products [is] not what you deliver so much as the client’s personal, subjective experience of those deliverables that uniquely defines what the client received. Their level of satisfaction and loyalty evolves out of that experience.”

In other words, “It’s not just about the end result, it’s about giving them a nice ride.” Value and differentiation are based in the ride as much as or more than they are in the products or end results.

Many sales organizations and sales representatives focus on building personal relationships to convince clients and prospects of their value. However, in tough economic times, particularly, Clarity, our clients, and other vendors need to do more than that. As one of our readers wrote to us recently, “Clients do not give you unconditional love.” They’re looking for value.

A very good way to communicate and differentiate “the ride” is to focus on our process.

How would we do this? One way involves features  usages/advantages  benefits. For example,

• (Features – the process steps, converting the intangibles of service or relationship management to tangible specifics) “If you banked with us, I would meet with you twice a year for a thoughtful, comprehensive, and expansive review of your goals and plans for the upcoming six months.

We would meet in a conference room. We would lay everything out on the table. We would look at your financial performance – balance sheet, income statement, and cash flow. We would look at the mechanics of your payment cycle management, including your volumes.

We would compare your company to industry benchmarks for financial performance and bank product utilization. We would look at what is changing in your operations and the industry best practices to address those changes.

On an annual basis, we would look at your exposure to various risks and ensure that you’ve addressed them and reduced your vulnerability. As conditions change, I would call to alert you that we should revisit our plans.

• (Usage/Advantages) “A significant number of our clients see these conversations as ‘eye-opening’ experiences that enable them to consider a far wider range of options to manage working capital more effectively and boost their financial performance relative to competitors and their own histories.”

• (Benefit) “As a result, when there have been gaps, they have been able to increase their profitability and, very often, increase available cash within a few weeks.”

Remember, “It’s not just about the outcomes.. It’s about giving them “a nice ride.”

If we’re able to describe the ride – the steps in our process and how we conduct them – as well as the outcomes from the ride, we’re well on our way to communicating and differentiating our value.

Imagine that you spent that next day on your knees on the lawn, lifting and turning over one leaf and then the next looking for the earring and that, on the 500th leaf, you found it. 499 leaves that didn’t pay off. 15 seconds per leaf, four per minute, 240 per hour, about two hours work. Would you be tired? Yes. Bored? Probably. Resentful? Possibly.

Would you feel rejected after turning over 499 leaves? Are you nuts? Leaves are just leaves. So, why do we feel rejected when 499 prospects say “no” or “not now?”

The most frequently requested topic I receive for this column and for our sales training is “prospecting” or developing new business. Sometimes, I sense that the requestors are asking for a magic twist that will transform their new business development activities so that prospects will arrive, swooning, at their doorsteps, a variation on the “one day my prince/princess will come” story, and that they will never again need to face “rejection.”

My extensive research on the subject has led to the following conclusions:

1) There is no such magic prospecting pill, wand, potion, dance, chant, phone script, mailer, or love potion.

2) We can’t make people be prospects if they don’t want to be.

3) The best business-to-business new client attractors have developed and use several techniques that DO work for most people, most of the time, to reduce rejection.

1. FOCUS: Think of this as “diamond earring under a leaf.” Very clear focus. The best new business developers we know can tell us exactly what “good prospects” look like, and they don’t fool around with companies or individuals that don’t fit the profile. This also means that they can train their referral sources to send prospective clients who will be good prospects.

2. REASONS TO CALL: When we approach prospects for appointments, we need better reasons than “you’re next on my list of 200 names.” While that may be true, we need another reason — some danger that’s coming, some benefit that’s emerging, a new idea, a market trend, an introduction, a possibility to consider. The idea is to connect with people on the issues about which they’re thinking to, to attract them to us with value or opportunity.

We can make it specific to a company or a moment in time, based on our research (e.g. “we expect the price of oil to increase 50% by next fall so we’re calling to….”) or general, related to the benefits our products or services generate

3. REFERRALS: The best new business developers typically make very few cold calls. They have developed reciprocal referral relationships that provide most of their new connections. The referrals can come from “centers of influence” (typically 3 – 5 of them) or clients and friends. By the way, referrals from clients are a LOT easier to ask for and receive if we are brilliantly serving them.

4. GROOVE UP SLOWLY: Pouncing suddenly from the weeds on unsuspecting prey (i.e. cold calling) is good sport, but it’s a lousy new business development strategy for most people. The best new business developers we know develop relationships and network relentlessly in a community (however they define it). They put themselves in places and activities in which their prospects or referral sources congregate. Instead of pouncing from the bushes, they gain peoples’ confidence over a period of time, then ask questions that open conversations leading to business discussion. It’s a very natural process, part of a 24 x 7 job.

5. REPETITION: Back to the leaves on the lawn on our knees. If we can’t reach our prospects (the diamond earrings) through referrals (e.g. specific directions to the location of the earrings on the lawn), we’re going to be turning over leaves until we encounter prospects who are interested in our messages.

Boring? Yes, it could be. The best new business developers see it more like a good game of cat-and-mouse. The fun is in the hunt, trying different approaches, ideas, and messages They decide the frequency, whether it’s once a year, four times a year, or eight times a year and touch them with messages that inform, connect, or refresh prospects’ memories about the value the sellers provide.

Repeat, repeat, repeat. 498 leaves to go. No rejection. They’re just leaves.

We’re packing for a weekend away. My wife (making a RARE appearance in this column) is leading the project. I ask, “What else do you see we need to do to finish packing?” She replies, listing several items.

I connect with remaining-child-at-home to work with me to complete the  items. A few minutes pass… and we hear mom/wife bellowing from another room in the house, “Can’t anybody see the laundry needs doing?” The child and I look at each other. Nope, neither of us had seen it. Bad karma in the house now.

We peel off to handle laundry, disrupting and stalling the tasks we had supposed were our main mission, which is now in trouble.

We fall into this trap sometimes when we’re closing a sale. We typically ask questions to identify the next steps to close the sale and implement our solution. We’ll ask, “What else do we need to do to complete this order?” That’s like asking, “what else do you see we need to do to finish packing?”

However, our clients, like my wife, usually are playing with a bigger picture than the piece we’re working with. Sometimes, our piece and the other pieces don’t match up. At this point, bellowing can be heard and the sale or use of our product is jeopardized or delayed.

Consider asking an additional question: “What else will you have to change or adjust  in the company in order for you to implement our proposed solution?” or words to that effect. Consider how this might have gone at my house, while we were packing.

Me: “What else do you see we need to do to finish packing? [[ See the mistake here? By saying the word "packing" on the end, I'm limiting my wife's thinking to "packing." So she responds, thinking only about packing. In a sales conversation, we make the same mistake when we ask what else must happen in order to conclude our transaction. The prospect limits his or her response to the transaction.]]

Wife: “Blah, blah, and blah.” (several items)

Me: “What else will we have to handle or finish in order for you to feel comfortable that we can leave? [[ Now I'm working in the context of the end result (we can leave for our trip). To get at this, I ask a broad, open question.]]

Wife: “I’d like to get the laundry finished, the blah blah put away, the wink wonk finished, then we’re ready. [[ The broad, open question teases out unrelated but important items that we need to handle in order for us to get the benefit of packing, i.e. we can leave.]]

Me: “Anything else we have to address?[[ Courageously, I stick with it, hoping that the answer to this question is "no," but better to find out now than later.]]

Wife: “No, that’s it.”

Whew!

So, when you’re wrapping up the details of an order, take a step back to work in the context of the end result to which your product or service will contribute. Ask a question designed to find out what other steps, related and not related to your sale, are needed in order for your prospect or customer to gain the full benefit of your product or service.

The prospect’s answer may show you obstacles you could not have anticipated otherwise and that, perhaps, you can help resolve. At the very least, you’ll have a better notion of whether the sale will really happen and whether the prospect will get the desired end result.

Looking at some family pictures, I was reminded of a time that I took my children, then ages 14 and 12, to my mother’s house for Thanksgiving. Not a trip high on my teenagers’ lists; even worse, it was a four day adventure away from their friends. However, two of the main attractions were her Siamese cats, Oliver and Dominic (and, no, I don’t know why she gave them those names).

The rap on cats (particularly Siamese) is they keep their own counsel, they’re aloof, they ignore you, they run the other way when you most want them to come out to play, they won’t come when you call them, et cetera, et cetera, et cetera.

Yet… one of our family members was able to lead the cats (both of them) around the house for 15 minutes at a time, more or less. How could this be? [For those of you who voted "by tying nooses around their necks," get a life, will you?]

The toy du jour was a six foot long, one inch wide, strip of colorful cloth.

One family member tried standing next to the cats and jiggling the cloth strip over their heads. Up and down, around in quick circles, wrap it around their necks and pull (that was VERY popular with my mother!). Sure, the cat or cats would reach for the cloth, biting and pulling it to the ground…. and they were bored in about five minutes. They would rise from the floor and walk away, ignoring all entreaties for them to stay. There’s a limit to how many times you like colored cloth smudged in your face.

Another member of our family stood away from the cats several feet, cloth strip almost completely on the floor in a straight line, and manipulated the cloth strip – it quivered, undulated, and jerked slightly. It looked like a geriatric Merrimeko snake on Ecstasy. The cats sat, one on either side of the cloth strip. They studied. They poked. They paced its length, then returned to poke again. Then, the strip began to move slowly away from them. They followed. To make a long story short, our family member led them around the house, up and down the halls, in and out of rooms, for 15 minutes.

How does all of this apply to retaining customers? First, both family members were engaging the cats personally (as opposed to sitting in one room of the house and calling to them to come out and play, promising all manner of treats and delights – the advertising approach). If you have 300 customers in your territory or branch and you’re not paying SOME personal attention to them, like my mother’s cats, they’re likely to ignore the advertising, wander off to find something else to do, even if that’s “take a nap.”

Second, the “cloth smudge in the face” strategy got old quickly. In sales, this is a product push, the old “Hey, we’re running a product special I want you to know about” or “Hey, it’s time for me to review our ‘relationship’ and see what else I can push in your face” approach. Like Dominic and Oliver, a couple of face smudges with the cloth strip were enough.

Third, the “Merimekko snake” was interactive. The family member would try some ideas and see what the cats responded to. Sometimes it took a little patience and multiple experiments to figure that out.

Same idea when thinking about customers we’d like to retain. Since they’re humans, “interactive” starts with conversation, understanding something about them – personal and business goals, plans, preferences, concerns, personal and business affiliations, families, senses of humor, hobbies and activities – and then showing interest by asking about them and, where appropriate, offering ideas we think might be helpful, whether that is information that could be useful for their kids, or their businesses, or themselves.

And, then, varying the mix. The Merrimeko snake would engage the cats for a day or so, after which we’d need a new approach. What worked yesterday or two days ago wouldn’t necessarily work today. Like humans, Oliver and Dominic got bored with the same game after a while. They responded positively to variation.

And so, with customers, we need to vary our approaches to attract their attention and then offer value related to their goals, families, and interests, et cetera, etc cetera, et cetera.

Joseph Nathan Kane, who died at the age of 103 in October, 2002, wrote “Famous First Facts,” a reference book of obscure items in American history. For example, the first airplane, Mr. Kane determined, was flown by Gustave Whitehead on April 14, 1901, near Bridgeport CT, more than two years before the Wright Bothers lifted off from Kitty Hawk, NC.

Once, when asked how be began his research career, he said that he started while in school. When his teachers declared some accepted point in history, he would ask, “How do you know?” It was a question he asked throughout his long life, explaining in 1988, when he was 89, “I’m stupid enough to not believe anything until I see the proof.”

Which brings us to sales calls. We salespeople sometimes allow ourselves to be lulled by the information we hear coming out of our prospects’ and clients’ mouths. It can sound so polished, so convincing, that we sit in our chairs wondering, “Where does this person have a challenge I could help fix, s/he sounds like s/he has everything under control.”

Well, surprise, surprise. All of us humans traffic in wishful thinking and disinformation from time to time. We like to look good. We like to appear under control. We may THINK we have everything under control. We may not have given it much thought, at all. Or, we may be saying, “ I don’t want to open up another can of worms here, so I’ll just tell you everything else is OK.”

So we salespeople can facilitate discussion, dig a little deeper.

In the right moment, I like Mr. Kane’s technique, “How do you know?” Or its sister question, “What has to go just right for that to work out?”

• My wife and I have saved enough for retirement. (How do you know?
  What has to go just right for that to work out?)
• Our current provider will be able to take care of all of our needs. (How do you know?)
• Our cash flow should remain stable for the next 6 to 12 months. (What has to work out just right…?)
• Our computer system will handle our needs for the next year. (How do you know?)
• Our managers will be able to handle the implementation, no problem. (How do you know?)

Any time someone asserts facts or conclusions, you can ask “how do you know?” or “What has to go just right…?” (Voice tone is critical here – we need to ask with respect and curiosity, striving to understand the facts and assumptions behind the assertion.

And, there’s a related follow up question you can ask, too: “As you move forward, what will you look at to know whether you’re staying on track or not? How will you know?” ["On track" here could mean anything from meeting production quotas to having enough money for retirement.]

Don’t take anything for granted.

Youthful excess and advancing age have led to creaky joints. From time to time, I seek help from physical therapists, trainers, and physicians.

I went to see a new provider last week. Our interview began with, “What has brought you here?” [This should sound familiar to frequent readers of this column as “the agenda-setting question.”]

I described my creakies. In my experience, the next step with in these sessions has typically been physical examination of offending creaky parts followed by recommendations to increase functionality.

My provider went in another direction. “How’s your health?” For the next 30 minutes he took a detailed personal and family health history. Parents. Siblings. Grandparents. Aunts and Uncles. Cousins. Dates. Births. Injuries. Treatments. Illnesses. Medications. Deaths. Exercise programs. Diet. The lot.

He then said, “Some of your challenges are genetic. Some are obviously the result of injury and wear. We need to handle those differently.” Then he did his physical exam and suggested some next steps that will involve X-rays, blood work, and other data gathering.

Note: He didn’t do the typical “open – probe – recommend – close” focused on a specific symptom – a knee or a hip, for example. He suggested we take a full systematic view.

Sales application: Whenever a client or prospect says, “I need to solve this problem” (e.g. my knees hurt, I have too much cash sitting in remote locations, I need to reduce computer system down time), we sellers can focus on the presenting problem only (i.e. the creaky part) or we can look more broadly at the whole system.

The broader our understanding of our prospect’s history of decisions (the “family history”), the better we’ll be able to make recommendations that will work … and … to understand the value our services will create … and to differentiate ourselves from competitors. Even if we’re selling only components of a larger solution.

In my case, even if my provider recommends simple stretches, I feel confident he has taken all important factors into account. He knows who he is dealing with. I feel reassured by his approach.