If You Are Going to Take the Time to Do a Trade Show…

I just spent three days covering 450,000 square feet of McCormick Place. Great venue for a trade show (sorry Indy, there is no comparison!) I walked past some 600 exhibitors, and spoke with over 150. It’s amazing how many people spend big money on the booth and then shoot themselves in the foot. While this was an international single industry show, the same lessons apply to the local business or chamber expo as well.

If you are going to display, keep these three rules in mind at all times.

1. Never walk up to someone who walks into your booth and ask, “Do you have any questions?” First, its a closed ended question and closed ended questions are a horrible way to start a conversation. Second, even though they are going to lie to you and say “no,” would they have stopped by your booth if they weren’t curious about something? Of course not. They have questions or you’d be looking at the back of their heads as they talk to the next booth.

2. You do not know how your offering can help me until you know the problems in my life. Unless I missed that “Omniscience 101” class in school, you don’t know what keeps me up at night or what my goals and objectives are for next year or even my goals for being at the show. Learn to ask questions that engage me on why I am spending my valuable time wearing out shoes. “Jeff, welcome. What’s the best thing you’ve seen so far at the show?” is a great opening because you want to know why I thought it was great (second question) so you can start to angle in on why/how your offering might compliment or replace what I think is the coolest thing so far.

3. Learn to watch my non-verbals. Even if I ask a question, that does not mean that I want a 2-10 minute presentation on the core technology and patent process you went through to get this offering to market. Watch my face and hands to see when I am done listening. Shorten your answers, and then ask, “There’s a lot more I could say, what would you like to hear about next?” or “There’s a lot more detail I could go into, but how do you see this fitting into your business?” or “I don’t want to overdo the details, so tell me what is most important to you?”

Remember that trade shows are like cold calling. Be able to capture attention in one sentence by using  the core value of your offering, and then lobbing a question to get me talking. The longer you talk, the less I listen.

So, what have been your experiences visiting and/or working trade shows?

Have You Decided to Participate in or Ignore the Media Fueled Economic Blip?

Here’s my solution to the economic “issue” and it times well with the changing seasons.

1.      We fire all members of the media who have made a snide, biased, or politically motivated comment about the economy in the last 90 days, unless they have a Ph.D. in economics. (Trust me, they will all be gone.)

2.      We go outside and rake the leaves in our yard, adding to our mulch pile, burning off a few calories, and providing some much needed oxygen to our brains before the cold weather sets in.

3.      After the leaves are up and we realize how nice it is to be alive and living free in America, we go to our favorite store and buy that one item that you have been putting off buying yourself or someone special.  Here’s mine: http://search.barnesandnoble.com/The-Snowball

Think it would work? I am 99.96% sure that if we did this, we would find the new newscasters on Thanksgiving would be telling of how thankful we are for rising retail sales, increased cash in the economy, lower unemployment, and a decrease in murders and drug use (that’s another whole topic…).

Ok, that is pretty idealistic isn’t it? Unfortunately, the few who might do it could not carry the load for those who don’t do it. Darn. So, my second solution is to come visit one of our sales classes between now and the holidays, free, just to get some ideas on how you can sell more hours, products, or services, at a higher price, to more people. http://www.INFOCUSSelling.com Just let me know when you want to stop by, we’ll send you the material for that week, and you can come in and get some tips to help you battle the bad news that surrounds your prospects every day telling them why not to buy from you. Is this self serving? We might get a client or two out of it. But, bigger picture, I do know what everyone will get—a better attitude all around as everyone’s sales climb the last quarter of 2008 from new attitudes combined with new approaches, and that’s my early holiday gift to Rainmakers. http://www.gorainmakers.com

Selling in Down Times

“I’ve had to lower my price to keep sales going.” If there are comments I don’t want to hear a client make, this is at the top of the list. When you cut price, you cut profit. That may seem like one of those “no kidding” comments but let’s look at what really happens.

Let’s say you sell a $100 product with an out of pocket cost of $40 and an overhead allocation of $25, leaving a $35 contribution to profit. If you sell 100 units, you make $3,500. Not too bad. Now let’s say you drop the price 15% to $85 to “keep sales.” Same $40 out of pocket and $25 of overhead, but now you only make a $20 contribution to profit per unit. If you sell the same 100 units, you profit is now $2000—profit takes the entire hit of a price reduction. To make the same $3500, you now have to sell 175 units. Wow! A 75% increase in volume to make up reduced profit. Can you sell 75% more? Not likely—that’s a lot more than just keeping “sales going,” it’s a sales explosion.

Maybe you provide a service where your personal labor is the cost. Your typical project is $400 and takes you 5 hours at $80 per hour. If you complete 5 projects a week, 25 project hours, you are grossing $2000. Not too bad. But, if you decide to drop the price to $350 to “keep sales” you are now making $70 per hour and $1750 per week. But wait, were you working 25 hours before? More likely you were working 1 hour to get each sale, plus 15 minutes per project to bill and file away records after the project (total 1.25 hours), and another 15 administrative hours for a total of 46.25 hours.

To make the same $2000, you have to sell 5.7 projects a week, a sales increase of 14%. That doesn’t sound too bad, except that it is still an increase in unit count just to “keep” the same sales—and now you are working 28.5 project hours instead of 25. After your price drop, you now need 5.7 hours of sales time, plus 1.43 hours to bill and file, plus the same 15 administrative hours for a new week of 50.63 hours…an increase of 4.38 hours per week. No big deal? After a year, you have worked almost 228 additional hours—over five more weeks to make the same amount of income! So much for vacation.

Still want to cut that price? I doubt it. Is cutting your price a good idea to drive sales? Very seldom. When the economy is supposedly having tough times (some of us think the tough times are more a function of the media and election rhetoric, and there is proof to back that up), then you must focus on selling 1) to the right clients who will pay full price and/or 2) selling smaller projects at a higher margin or hourly rate so your profit per sales dollar or billable hour is higher. Is this possible? Sure. How? Go back to what people buy from you, your unfair advantage, and be intensely focused on selling only to those prospects who need the result you can deliver, and walk away from projects that will take too much time away from you finding and delivering high value products and services.

If you must sell at a lower dollar amount, take something out and raise your hourly rate. Remember that you cover your selling and administrative hours by what you generate in billable hours. Tell your prospect that “to meet that price, we can do this” and redefine “this” as less than your regular package where the reduction in hours is less than the reduction in price—reduce project hours by 20%  with a 15% decrease in sales amount which actually increases your profit margin. If the “this” is important to them, they will find those dollars. If you are selling a product, remove a feature and reduce the price only by the cost of the feature—leave any profit or margin in your selling price.

There’s an old joke about a farmer losing money each time he took his goods to the market, so he bought an extra cart so he could make it up on volume and then went bankrupt. You really can’t make it up on volume. Keep your margins, focus on selling to a narrower market, and don’t commit to working an extra month per year just to stay even.

Differentiation

by Scott Seibert

 

What is it that allows you to separate yourself from your scum-sucking, riff raff competitors? What is it that allows you to demand more for your product or service? What is it that sets your brand apart from others? It is simply how you are able to differentiate yourself and what you sell.

Continued…