There is no question that referral sourcing is more important than ever. Companies want producers who can generate referral business and cultivate deeper relationships with those sources. When recruiting, one key question managers must ask: “Is it better to hire a relationship-builder or someone who can create value?”
When you look at the selling profession historically, there have only been a few meaningful breakthroughs over the years. The first major shift happened about 100 years ago when the hunter-farmer sales model was introduced by insurance companies. The concept, which separated the individuals who collected premiums from those who sold the policies, was wildly successful and changed the insurance industry overnight. According to Neil Rackham, author of “Spin Selling,” the model spread to other industries and for the first time, selling became a “pure” role without the burden of collection.
Later, the psychology of selling was introduced which was about sales techniques such as overcoming objections and closing. Sales professionals could learn specific practices that would help them sell more effectively. This was followed by the consultative selling approach which introduced sophisticated models of how to sell complex products and services.
More recently, sales automation, sales process and customer relationship management systems have shifted the selling landscape once again. Certainly, while technological advances have played a bigger role in selling, these changes have had only an incremental impact on sales effectiveness. Just look at the mortgage industry where the monthly average production per loan officer has remained between 2 to 3 units for a decade even with robust markets.
The real revolution in selling has happened on the purchasing side of the equation. Whether a consumer or business, the prospect’s unprecedented access to information has changed selling fundamentally. The bottom-line is that sellers can no longer control the buying decision as they once did and purchasers do not want to waste time with poor sales professionals and unresponsive companies. “Warm and fuzzy” is not enough to win in sales any more.
Conventional wisdom has long held that selling is all about relationships. The thought process is “build relationships first and then sales will follow.” Unfortunately, this is no longer true. That’s not to say that relationships are unimportant. I think that a better explanation is that relationships have been separated from the purchasing decision. Customers may have a great relationship with an originator but if they receive greater value from another sales professional, they will do business with that person.
What is customer value? When a sales professional helps a referral source think differently and brings new ideas, he or she earns the right to have a relationship. Industry surveys consistently show that customers put the highest value on salespeople who make them think, offer new ideas and find creative and innovative ways to expand the customer’s business. The bottom line: Customers are demanding more in-depth expertise.
In my view, we are in a world where “how you sell” has become more important than “what you sell.” Can your sales force deliver what today’s customers want?