Rami Rustom wanted to increase sales at his 5 cell phone stores. He came up with a Make Your Business Initiative for his 15 sales representatives. He hired me to edit the document presenting it to his team. He liked my work:
I like it a lot. Way more positive. And of course way more understandable.
Definitely a good investment to set the stage for my reps.
Here's what I created for Rami:
Ten years ago, this industry was full of order takers. An order taker is like a McDonalds cashier. They sit around and wait for sales to come to them. Our industry used to get away with that because there wasn't much competition.
Today, things have changed. The industry is very competitive and order takers are falling by the wayside. To succeed, we have to be more proactive and create sales, upsell those sales, and get more referrals, instead of hoping people will just walk in the door and place an order.
Verizon came down on us two years ago and again last August because our Smartphone Mix and MBB was much lower than their average. That means they considered us as passive order takers. And I agree with them partially. We were proactive with WOWing customers but we were too passive with upselling.
So I created the Smartphone/MBB initiative and we hit it hard and now we kill Verizon's average numbers. So no one can call us order takers anymore. I was proactive by creating the initiative and you were proactive by trying hard to make it work. So now we're good at upselling.
Today, I want to talk about the two components of the sales process that we're going to improve on next. They are follow-ups and referrals. Everyone, including Jason and I, have been too passive about this, and now it's time to get better. This will generate more sales, make more money for you and for Wireless Express, and better please our customers.
Follow-ups are a way that you can take initiative to get more sales. If the customer doesn't make a purchase today, but he plans to in the future, then it's important to actively follow up with him and get that sale done. The way to do this is by scheduling a later time when he will come back and calling him to confirm the day before. And we're providing the perfect tool to do this right in gmail and we even have a video training to walk you through it; its called gtasks.
Follow-ups are also important with leads. We need to get leads on potential customers and then follow through with those leads to bring in more sales.
That brings us to the second component which is getting as many referrals as we can in order to get leads on more customers who don't just walk in the front door. The best way to get leads is to ask for them. After you WOW a customer, let him know that you appreciate his business and see if he knows anyone else who might be interested that he can refer you to. Then follow-up on the referral.
Some referrals will happen by themselves, but by taking initiative with referral marketing we can do better.
Why do referrals work?
Let's consider how customers think:
Customers are not usually thinking about sending you referrals
Customers typically feel awkward when cornered into giving a sales person a referral
Customers worry because their reputation is at stake
The solution is to gain customer trust
Build rapport and WOW the customer
If they are confident in you, they'll often be happy to give you referrals.
Make sure to ask for your referrals. Take initiative and let them know that you want referrals. They probably won't volunteer referrals.
We’re bombarded daily with so many marketing messages. People have learned to filter them out.
But people don't filter out their friends and relatives.
When you get a referral, you have enough of a human relationship to get a little attention instead of being filtered out.
Most traditional ways of getting leads cost money. For example you can buy advertising. By asking our exist customers to help, we can acquire leads for free. And customers like giving high quality referrals because later their friend will thank them.
The Benefits of Referral Marketing
Consumers today have developed cynicism and distrust of advertising messages. When considering a purchase, we’re now much more likely to ask a trusted friend or acquaintance for a recommendation.
We listen to those we know and trust. When a friend of theirs has referred a potential client to you, a level of credibility and trust has already been established. They are more open to hear what you have to say.
Referral leads can turn into sales more quickly because the referrer (original customer) may already have told the referee (new lead) about what we do and why it's a good value.
Referral marketing is more profitable. That's because referred customers do less shopping around for the best price, so we don't have to price match as much. And we don't have to pay for advertising to bring them in.
To generate a steady stream of referrals will take effort, but may cost little or nothing at all. Did you know that Paul spends no money at all to get his referrals? Did you know that Paul gets zero walk-in traffic and earns 100% of his company profit from referrals?
How Do You Get Referrals?
Your service must be top notch. In today’s competitive marketplace, simply meeting your clients’ expectations isn’t enough. Aim to exceed expectations.
Under promise and over deliver. Remember: the person referring you is putting his or her reputation on the line. They must have confidence in you! So you must WOW them! Make them think, "WOW no cellular-guy has ever done that for me before!"
Ask for referrals. Your customers aren't thinking about you. You must make them think about you by asking for the referral. Be proactive!
Don't worry if you're not sure about how to do this. We've got more information in our WOWing document and our referrals training videos.
Once you get referrals, follow-up on them.
When a customer doesn't complete a purchase, try to schedule when he will come back and call the day before to confirm the appointment.
Don't hope for sales to complete themselves, take initiative.
We'll cover all the details in our training videos.
But Referrals and Follow-Ups are not that easy, as we all know. So we've come up with a plan to make it easy. We'll discuss the plan below. First I want to help you understand the situation a bit more.
Think of it like this: out of the company revenue, we pay rent, advertising, your hourly wages, etc., just to keep our doors open to be able to bring in walk-in traffic. But that traffic is not enough to be profitable. It's a competitive marketplace and people can buy from so many places besides our stores. We have to be proactive to compete with all the alternatives.
Here's how our business can be successful:
- WOWing our customers, [we're already very proactive with this]
- Upselling, [we've already very proactive with this]
- Scheduling follow-ups, [we're going to improve on this]
- Driving referrals [we're going to improve on this]
What causes passivity?
What do we need to watch out for in order to do better?
I think it based in psychology. We think that our potential customers will come back to us because we've WOWed them and we think that because we've WOWed them that they will refer people. So it is hope. We 'hope' that they will do these things. But we've learned that hope is disastrous.
Remember the Sales Jeopardy video? It explains the dangers of hope: video link
Our potential customers are not thinking about us as much as we 'hope'. And they may not understand how commissions work. So help them out and tell them what they need to know. Tell them:
Tell them that you appreciate their business.
Offer them an ongoing relationship; that you should be their "cellular guy" for all their needs.
As part of the relationship, take notes on their situation. They'll appreciate not having to explain anything twice.
Tell them that you're looking for more customers.
Ask who they know that should have a “cellular guy” like you.
When they give you referrals, get names and phone numbers so that you can follow-up and so you don't have to hope that they'll bring the leads in the door for you.
If you don't bring these things up, they probably won't think of it by themselves.
*** THE MAKE YOUR BUSINESS INITIATIVE ***
So, we've come up with the Make Your Business (MYB) initiative. It will help you learn the tools and habits you'll need to be proactive with scheduling follow-ups and driving referrals.
And you know this is going to work. Why? We've thought hard about how to design this so it'll be just as successful as our past initiatives. Just think back to the results we got when we started the initiatives to increase Visual Voicemail take rate, 5Star take rate, Smartphones mix, and MBB percentage.
We've got a good plan and we know you'll be able to execute it when you give it a try, just like you've succeeded in the past.
The 'Make Your Business' initiative has three simple components:
We've created videos to show you how to do everything for the MYB initiative, which you can find in the WX Video Training Log. There is also the audiobook 7 Habits of Highly Effective People which you can find in WX Files. I understand that its a 5 hour long book so please listen to that ASAP during your downtime at the store.
2) Tracking Metrics
Keeping track of our progress can help us improve. It can help you know what to focus on, and we need the data to do our job as management.
When people keep track of stuff, they can usually improve it. Why? Because it helps them reflect on your performance and as we've learned, reflection causes learning which then causes increased performance. But if they don't keep track, sometimes they let things slip, they don't reflect, and they miss out on opportunities.
I know it can seem like micromanagement to track a lot of information. But it will help you understand the MYB initiative better and see how you're doing, and we'll look at the information to help coach you and help you reflect to improve your sales.
For tracking metrics, there are two new sheets in the Sales Reflection doc, MYB Goals and MYB Daily.
You'll be inputting 9 figures each day on MYB Daily. Mouse-over each column header for an explanation of how it works, and we also have a training video explaining how to use the sheet.
MYB Goals will help us set and meet goals as we improve. We guess that you currently earn less than 10% of your company profit from referrals, so we put in an initial goal of 10%. You can change it if you want to. Each month, the goals will increase and your actual percent of referrals will increase too. And of course this means that your company profit will increase and that means lots more commission for you!
Once the MYB initiative is off to a good start, we'll be able to keep track of our progress metrics less. Who will be the first one to reach that point?
We're adjusting commissions to better reward success in the MYB initiative. The old KPI commission structure is being replaced with the new Make Your Business commission structure. We'll now be focused directly on profit. The more profit you bring in, the better for us and the better for you.
These changes to commissions are not a raise nor a pay cut. It's just restructuring and you can expect to make about the same amount of money as before -- at least to start with. As the MYB initiative moves along and generates more profit, then we'll all be doing better.
Here is the new structure, which is a lot higher than the industry average:
Starting at @ 8%
$6,000+ @ 12% = at least $720
$8,000+ @ 16% = at least $1,280
$10,000+ @ 20% = at least $2,000
$15,000+ @ 22% = at least $3,300
$20,000+ @ 24% = at least $4,800
So as an example, say you earned $6,500 in company profit, that puts you at 12% commission, and that equates to $780 in commission. If you earn $8,001 in company profit, that puts you at 16% which equates to $1,280.16.
The MYB initiative is about being proactive. We'll do that with follow-ups and referrals. And that will bring in more profit. Higher profit will benefit Wireless Express and earn you a higher commission. Customers will also enjoy the proactive treatment because they come to our stores to get help. If they didn't want a salesperson's attention they would shop online.
The MYB initiative is all about initiative. So who's going to take the lead?
PS. We'll be discussing this during our next conference call so write down your questions. Or if you want you can reply to this email with your questions.
You can compare with the original document to see what changes I made.