Understanding the Buying Process with Steve Elwell

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[00:21] Opening / Introduction [01:09] Tell us about your background.

• I grew up in Southern Michigan about 1 hour from Detroit, Michigan.
• I graduated from Albion College (MI) with a degree in economics. Then, I got an MBA from Wayne State.

[01:40] What was your first adult job?

• When I got my MBA, I hoped to land a top job, instead I found myself selling printing services door-to-door, which was a great way to learn about sales.
• Next, I went to work for an industrial manufacturing / distribution company in Milwaukee, Wisconsin.
• Eventually, I owned and operated a retained executive search company that focused on automotive and industrial clients.
• After joining a friend’s company to grow the business, I ran 5 businesses as CEO, COO and GM.
• Today, I own a consulting business where I help companies grow their businesses.

[03:20] Why is the buying process different from the sales process and why is it so important for salespeople to understand?

• The buyer controls the buying process and as sellers, our job is to understand and influence it.
• The sales process is created in response to the buying the process.

[04:56] Talk about the differences between strategic sales and transactional sales.

• A purchase is strategic based depending on it’s importance to the buyer.
• Transactional sales are less important and typically have perceived risk.
• If senior management or a large cross-functional involved in the decision making, then the sales is most likely strategic.
• If you want to understand whether a buying process is strategic or transactional, watch the buyer’s behavior (who is involved, questions ask, how in-depth, etc.)

[09:14] What kinds of risks are these people trying to protect themselves against?

• There’s financial risk, such as paying too much.
• There’s performance risk, such as a late or damaged shipment.
• The buyers are trying to satisfy themselves that the risks are minimal and under control.

[10:33] Do you usually try to map out what the buying process looks like?

• I like to map out the buying process if possible.
• Generally, the same kind of sale will be made time and time again. Therefore, mapping is useful.
• Mapping the buying process deepens understanding, improves internal collaboration and ideally improves sales performance.

[11:43] Every once in a while, you’ll go somewhere and the owner says they need X amount of sales by the end of the year. Then you dig into the buying process and discover the sales goal is not achievable because the buying process is too long.

• That’s a huge issue. It’s indicative of an executive or a company that hasn’t taken the steps to understanding the buying process.
• When leadership doesn’t understand the buying process, it leads to management mistakes and bad decisions.

[13:46] When you’re working with companies do you try to nail down how long the buying process takes?

• Yes, and not just in a sales growth environment. I also do it in an environment where the company needs some help.
• These companies will typically have existing customers, and when these customers place an order, it’s much quicker than when a new customer does so.
• When you go for a new customer, many questions that only need to be asked and answered once are presented.

[16:08] Is there a way for us to make the buying process go faster?

• We as sellers add time to the process by responding slowly, responding with incomplete answers, etc.
• Prospective customers will judge how they will be treated as a customer based on how they are treated in the buying process.
• Three things that can be done as a sales manager are:
  1. Increase the number of opportunities you have available to you.
  2. Shorten the amount of time that it takes to get to a decision.
  3. Improve the rate of success at which you can close.

[20:50] The buying process begins online now, but so often, salespeople think that the sales process begins when they pick up the phone.

• It’s a disconnect and a particularly nasty problem. If you’re not in a mindset of thinking about where the process really started, you’ll miss it completely.
• The dwell time of an online resource is far greater than a phone call or an email. It’s always there.
• If I call someone, I’m unknown, and that’s the greatest risk of all. If you put out content online where people can engage with you, they begin to know you and that’s a huge advantage.

[27:08] If you can answer prospective customers’ question before even engaging, you’ve got a head start.

• The process that they use to get those answers, and how they use those answers in their decision to do business with you, is the buying process.

 

Learn more:

Steve Elwell’s LinkedIn profile: https://www.linkedin.com/in/selwell