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Head of Community Growth at Lavender.ai | Co-Founder of Social Social | Keynote Speaker
On average, 40-60% of B2B sales opportunities are lost to the status quo objection.
We’re not losing to competitors as frequently as we’re losing to customer risk aversion – aka the customer’s gut feeling that regardless of how much “better” our solution may be, the road to “better” involves change, cost, and productivity losses.
In this episode of Closing Time, Jen Allen will help sellers overcome the status quo, create demand, and earn time with budget-conscious buyers with one key metric: COI (cost-of-inaction).
Often, as sellers and marketers, we’re fixated on showcasing benefits and ROI, forgetting to empathize with buyers’ emotions and their aversion to change. Sticking to the status quo is simply easier for most people. This is why COI (Cost of Inaction) is a powerful metric for sales reps to leverage. Here’s how COI and ROI differ:
ROI (Return on Investment) focuses on the potential benefits and gains a buyer can expect from an investment. It highlights how a product or service can positively impact their bottom line.
On the other hand, COI (Cost of Inaction) shifts the perspective to emphasize the negative consequences of not taking action. It addresses the risks, losses, and missed opportunities that can result from maintaining the status quo. COI taps into the psychology of avoiding loss, which can often be a more compelling motivator than the promise of gain offered by ROI.
So, what’s the initial step to help buyers embrace change? It’s all about shifting perspectives. Instead of focusing solely on what we have to offer, we must view the buyer’s business through their eyes. CEO insights are invaluable here. Previously, annual reports were a source of information, but now CEOs often share their thoughts through interviews and podcasts. These conversations shed light on the company’s objectives, beliefs, and strategies.
By demonstrating how the status quo could be hindering their progress, you’re effectively helping them see the urgency of change.
The buyer’s fear of change can cast a shadow over even the most promising deals. In today’s uncertain climate, where every decision is scrutinized, this fear has taken on new dimensions. As a sales rep, it’s crucial to acknowledge and navigate this fear to help your buyers make the leap. After all, change might just be the key to unlocking growth, even amidst challenges.
Imagine this scenario: You’re engaged with a potential buyer who initially seemed enthusiastic about solving a pressing issue. Yet, as the conversation progresses, doubts creep in. This is where the rational and emotional voices come into play.
Rationally, your buyer has valid concerns. Implementing a new solution demands time and resources. It requires building a business case, rallying the team, and integrating new practices into the existing workflow. In an era marked by staff cuts and budget constraints, the rational voice questions whether the potential benefits are worth the effort.
Emotionally, there’s an entirely different dynamic at play. What if the new solution falls short of expectations? What if the team resists the change? These “what if” moments can morph into vivid scenarios where the consequences of a failed implementation seem insurmountable.
Now, as a sales rep, how can you guide your buyers through this thicket of fears? It begins by embracing a holistic approach. Rather than immediately presenting your solution’s benefits, start by delving into the buyer’s current challenges. The goal is to illuminate the hidden costs of maintaining the status quo – aka Cost of Inaction (COI).
Yes, change is scary. Yes, the “what ifs” are real. But your role is to gently nudge the buyer toward recognizing the unexplored costs they’re bearing by sticking with the familiar. Illuminate the drawbacks, both financial and strategic, of their present situation. Show them that inaction isn’t as safe as it seems.
A dose of empathy can be the game-changer for sales reps, helping you truly connect with buyers’ fears and challenges.
Say you’re on a call with a buyer – you’re enthusiastic about your solution, talking about the brighter side of change. But your buyer, with the weight of implementation and adoption in mind, is seeing a different picture. This discrepancy can create a chasm of understanding.
To bridge that gap, sales reps should acknowledge the less appealing aspects of change. Embrace the “ugly” stuff and discuss potential pitfalls openly. Show your buyer that you’re not just there for the sunny side; you’re ready to navigate the rough patches together.
Building trust isn’t just about slick presentations or impressive numbers. It’s about seeing the world through your buyer’s eyes. When you align your perspective with theirs, when you grasp the hurdles and hesitations they face, trust and credibility naturally follow.
Relating to their concerns showcases your genuine understanding. It says, “I get it, and I’m here to help you overcome these hurdles.” This is the path to establishing a partnership rather than just a transaction.
Empathy isn’t just a buzzword; it’s the key to forging meaningful connections and crafting sales outreach that truly resonates.
In an age of constant outreach, the cookie-cutter formula of “Who we are – What we do – How great we are” is all too recognizable. It lacks that personal touch.
To stand out, sales outreach should pivot towards the customer. It starts with understanding their goals. Then, instead of merely touting your prowess, it’s about showing how your solution aligns with their objectives.
However, tread carefully. The tone matters. It’s not about claiming superiority but about presenting ideas. It’s saying, “I’ve got insights that might resonate with you.”
Now, some might ask, is COI the new ROI? While ROI still has its place, COI, the Cost of Inaction, is gaining ground, especially in the early stages of fostering demand. It’s about highlighting what the buyer might lose by staying put, rather than just the gains they could make.
As go-to-market leaders, what can you do to make change more attractive to those you’re selling to? We’re talking all about overcoming the status quo in this episode of Closing Time. Hey everyone, I’m Chip House. CMO here at Insightly. Welcome to Closing Time, the show for go-to-market leaders. I’m joined today by Jen Allen. Jen is co-founder of the Social Social Community, sales keynote speaker, and currently heads community growth at Lavender.ai. Welcome, Jen. Thank you so much for having me. I’m so excited. Yeah, absolutely. So, Jen, I saw your first post on this topic I think it was back in December. Time is flying by here. But you were talking about COI or the cost of inaction rather than ROI as being something that salespeople need to focus on. Can you explain that a little bit? Sure. So I spent my entire career as a salesperson, like a front line salesperson, and I was always taught that customers buy because of the value or benefit that you deliver. Right. So when I thought about how I sold and how I tried to compel them to want to buy from us,. I focused a lot on the ROI case. So, we’ll 15x your growth or whatever the case may be. What I failed to appreciate, though, just as humans, we often respond far more urgently to the avoidance of risk as opposed to the realization of a benefit. So, for example,. I have a wedding in just over a month. I have been telling myself for the last six months that I’m going to get in shape for it and I have a compelling event I have a reason to lean into it, but every day I wake up and I hit the snooze button on my alarm because I’m not in bad enough shape that I’m like, It’s going to be awful if nothing changes. And I think sometimes we forget it’s the same idea with buyers. So cost of inaction isn’t focused on if you do something, you get this. It is focused on if you do nothing differently. This is what it is costing your business, not just financially, but in terms of risk, lack of engagement, whatever the right metric might be. Yeah. You know, as sellers and marketing people, it seems like we focus so much on here’s the benefits, here’s the ROI, right? So we kind of forget about being in the shoes of the buyer and what kind of emotions they might be going through. And of course, most people are just sort of predisposed to not changing. Right? That’s always easier, it seems. So tell me about what you think the first thing is that a seller needs to do to help the buyer work through change. So the very first thing is we need to look at the buyer’s business through the eyes of the buyer, not through what we have to sell them. So, you know, when I was selling sales training, I was always looking at a company saying how many salespeople do they have and how big of a deal would it be if I were able to sell them? And that would be my motivation to reach out. And then I would try to convince them why we’re the best sales training program in the world. And they frankly wouldn’t care. Instead, when I say focus on the buyer’s business through their eyes, what I’m being what I’m talking about specifically is looking at how the CEO is talking about what the business is trying to achieve and how they believe they achieve it. So it used to be we would only have access to that information if it was a public company and we could read their annual report. Now, if you literally go out there and Google the CEO’s name, plus the company’s name, plus interview or podcast, they’re having conversations just like you and I are, Chip. Right? They’re talking about what the business is trying to achieve. They’re talking about their beliefs and assumptions around how they get there. And so as a seller,. I have to take a moment and be curious around what is that customer trying to achieve? And can I see places where they believe one plus one equals two, but it actually equals three. And that is my that is my very first step I’m taking is where is the problem that my solution solve for showing up in their business? And am I even convinced that by fixing it, it’s big enough? Right. Like this was another problem, a misstep I made all the time. Is I think everybody could benefit from sales training. But if I was targeting Zoom during the pandemic. Yeah, there are great account on paper. They got a lot of salespeople, did they really need to create more demand? I would argue probably not. It’s not to say sales training wouldn’t be helpful, but I think we need to look at that through that lens as to say, am I going to be up against such a status quo barrier that I’m effectively I could be doing all the right things but just wasting my time because the problem isn’t large enough for them to merit solving it? Yeah. So I think the first thing you talked about there was like doing some Google research, right? Actually, to kind of prep yourself. And we’ve talked about that with other guests. You know, I’ve had a sort of a similar like a discussion just about doing the work upfront to understand your buyer’s situation, right? So you can put yourself in their shoes.. You also talked a little bit about, you know, fear of change. I think that was in your post back in December. And, you know, especially in this climate, I would think the fear of change is maybe heightened. It feels like the best thing to do is maybe nothing. And it could be the worst time to do nothing, frankly. Right. So what’s your perspective on helping them overcome fear of change? So this was another kind of eye opening moment for me as a seller because I would have a really hard time understanding if a business was having a growth problem. You know, my naive perspective would be why wouldn’t you do everything you possibly could solve it, right? So I was having these pipeline opportunities that went nowhere, and I just couldn’t understand why. What I was neglecting to consider is the fact that when any of us make decisions, there’s a rational voice and there’s an emotional voice. So I may have been the person, let’s play this out, I’m a customer. I may have been the person to raise my hand and say, we have a problem and I want to seek out an alternative way to solve for it. But as I start learning from the salesperson, as I start bringing other members of the buying group in, as I start reading things online, talking to friends, all of a sudden all these what if thoughts happen? Right. So in the rational side,. I’m sitting here saying OK, but if I do buy this, now I have to build an entire business case, now I got to herd all these cats in my business and get them involved. And this is work on top of what I already am doing, which is probably more work than I would like because of staff cuts and budget reductions and things like that. So that’s my rational side. On my emotional side, I’m thinking, what if I bring in a new solution to this problem and everybody in the business looks at me and said, Why did you spend money there? Or, We prefer the old way. And so all of a sudden these what if moments start to feel really, really big? And so I can look an ROI in the face and say, Sure, you might three times whatever. But what about all this other ugly stuff? What if that happens? And so I think this is where we get into this conversation of we have to before we ever talk about the upside of what our solution can do, we really have to align with our buyer to say, Are you really confronting just how ugly your current state is? Because most of us don’t want to stare that beast in the eye and it is our job as sellers to illuminate. Yes, change is scary. Yes, all these what ifs can happen. But here’s what I’m certain of.. The way you’re solving this problem today is costing you this, this and this. And that’s where I think we have an opportunity as a seller to illuminate that for our buyers when they’re not looking. It’s super interesting what you said, appealing to both the rational and the emotional, because I think we’re so sort of trained to appeal to the rational and think that that’s going to be the discussion that we have with a potential buyer. But the emotional might be way more important. Right? And so if you have some element of empathy and you’re thinking about or at least empathizing with them for, hey,. I know that this is going to be change, it’s going to be some work for you. There’s other people you have to convince and I’ll help you do that maybe. Is that how you maybe help bridge the gap? Yeah. I love the way you said that, Chip, because I think sometimes again,. I’ll just speak personally. We have a tendency to oversimplify the change that is involved or the pain that is involved with change, not just buying it, but implementing it and getting people to change their behavior, to start using whatever that solution is. And I think I would show up to calls sounding very naive that I’m like, of course we do this because we just get through the implementation. And then these are all the rosy things that happen on the other side. And my buyer’s sitting there saying,. You have no idea what it’s like to be in my shoes. And so I think when we do exactly what you said and say, let’s look at this ugly thing in the face. Yes, these are all these things that might go wrong, but I’m going to help you. Here’s how we’re going to help make sure that we mitigate those risks. That’s when I feel like, you know, there’s all this conversation about building trust and credibility. To me, being able to think and see like a buyer is how we do that. And relating to those concerns shows that you get it and that you deserve to be in that room. Yeah. So let’s put the name on some of those fears. So I already talked about, you know, the fear that they’re going to do a ton of work, right? So there’s some like loss of productivity that that they’re probably concerned about, you know, or opportunity cost for them, like diving into this, but not something else. They’re going to have to spend some money. They’re going to have to convince their finance team that it’s worth the money. Or if they don’t do their work upfront, there’s going to be some loss and potential status right in the company in those can weigh heavy in a buyer’s mind, I’m pretty sure. So do those, and anything else that comes to mind, you know, that I didn’t name there. Now, I think it’s that last one that’s the ugly one. we don’t really think a lot about. Political capital is a scary thing to put on the table for and this is going back to what you just said for a very rational reason. This is one of the reasons. I think the emotional case for change has to be equally as strong is because we are asking someone to raise their hand in an environment that all we’re hearing about are layoffs and budget cuts and bad things and say,. I want to spend some money. So I think it’s that political capital that we have to be really mindful of. People are putting that on the table, and that’s bigger than we often give it credit for. Yeah. So the other thing that I thought was really compelling that you said is that a big piece of this is about helping the buyer realize that the ongoing costs of their pain today are worse than their fears of change. Right. Not changing could be worse. And you have to hold their hands through that, right? Yes. Yes. And I can give you a very specific example. I used to sell against this all the time. So in my previous job, when I’m selling sales training, nobody needs sales training, right? Like it doesn’t keep anybody’s lights on. But one of the things sales leaders would neglect to realize is how many of their sellers were wasting many, many hours chasing deals that ended in no decision. So one of the exercises I would do with them to help them calculate that cost of inaction is to say, like, let’s take, you know, how many accounts your sellers are working on average let’s take how many hours on average they’re spending on each of those accounts, and then let’s multiply that by the 40% of deals that tend to die in no decision. And now let’s multiply that by the number of sellers you have on your team. And now what we get is the number of hours your sellers have wasted just this month on chasing deals that are never going to convert because you don’t have an intentional solution to that no decision problem. And so then it doesn’t become an issue of ROI, it becomes an issue of how do we take that number, which sometimes was like 10,000 hours and cut it down to 5,000 or even 7,000 or 8,000. Right? And so then I think you get into a much more believable motion of I believe that we can dice that problem up instead of these aspirational ROI metrics, which let’s face it, most of us in our heads are saying that’s your best case customer. You’re not telling me the average customer ROI. So that’s where I think sizing that cost of inaction in terms of hours, time, money, risk. However makes the most sense for your stakeholder is essential so that they are looking at the same formula that you are. I mean, the more you’re talking about this, this seems gigantic to me. It seems like the most overlooked thing in B2B selling because as somebody who buys a lot of software and you know, work with agencies and make those decisions all the time about where to invest the money, there’s a lot of that that goes into it because you’re doing the math in your head. You’re thinking about opportunity costs. Where else could you invest the money? And the more that the seller does their work to actually put their selves in your shoes and really understand where you’re coming from and that you have other things to spend money on, you know what else you might even be considering if there’s enough, you know, understanding about what a CMO does, frankly, right I think that that is huge because it’s, you know, I, I think, you know,. I sell software, you know, and you’re in a community now, leadership position for a software company as well. And so I know Seth Godin used to compare products in other industries like, hey, everything’s good enough now, right? You can have an Audi, you can have a Toyota, you can have a GM. All of those cars are good enough. And so there’s so much of the softer side of selling that’s become more important. Yes. And I think you know this far better than I do. I’m just now getting a taste of it because I think people think I’m a little bit more senior than I am in this role and I’m getting a lot more outreach. But it’s wild when you think about the you can almost just recognize a piece of sales outreach when you see it, right? It’s that classic formula of here’s who we are, here’s what we do, here’s how great we are at it, and here’s all the other companies who love us. Like, you could just, it’s in all of these emails. So I think even interrupting that and making the focus of our outreach about the customer. So when I do an outreach, right, I’m saying, your CEO spoke about this as a goal and this is what it looks like as an outsider, it seems like you’re trying to attack it from the angle of. And then, have you ever considered how this thing over here might be impacting your ability to do that? Not sure if it’s worth the conversation or not, but we’d be super curious to have it if you want to. And I think what it does is we’ve got to be careful about tonality of toeing that line, of saying, I know more about your business than you do. That’s I think that’s an ugly tone versus saying,. Hey, I’m very curious about this thing. I do have expertise in this area and I have something of value to add to the conversation, but I’m not telling you your business is broken. I’m not telling you you need to fix something. I’m simply raising an idea and showing that I’ve got a bit of credibility on that topic. So, Jen, would you go as far as to say that COI is the new ROI? Oh, I would totally. Now, people are going to hate that and there’s still a time and place for ROI. OK, let me be super clear, especially anyone in med device who’s listening to this, because they always come for me on that you still have to be able to show that it is worth them investing their money in you, in your business over anybody else. But to build demand or create demand, ROI, in my opinion, is a largely ineffective means for that ROI is late stage, COI is early stage. Great tips. Thanks so much, Jen.. It was great having you. Thank you so much. Great talking to you. Yeah, absolutely. And I hope to have you on again soon. And to everybody there at home, thanks for joining us for this episode of Closing Time. And we’ll see you next time.