What Is A Sales Process And Why Should I Care?

Well, I guess if you are not interested in growing your business and making more money, then you may not care. Otherwise, it becomes very important.

A sales process is simply a series of steps that a person goes through before they give you money for your product or service. Many businesses, though, never stop and think about these steps, they just figure that if they advertise, they should make more sales. At least, that is what they have been told.

I did a little exercise the other day for one of my businesses that I found extremely helpful. Then I sent an email over to my partner and told him to do the same thing. He was blown away by the result!

Here is what I did…

I simply drew out the steps that a prospect takes as they hear about and interact with my business. Get out a piece of paper and make boxes and draw out the steps that a person takes on the path that turns them from a prospect to a customer.

Here is what I mean. Let’s say for example that first, you advertise, what happens then? What is your call to action? What happens to them if they contact your business? What happens to them if they buy? Do you have a process in place to sell them something else? What happens if they don’t buy? Do you have a follow-up system in place to convert them later?

See, once you draw it out and can see what action leads to the next step, then it can help you organize your business. You may realize that you have neglected an entire group of people that you could be selling to. You may be missing an entire system in the sales process.

The main benefit, though, of doing this exercise is that it helps you understand what moves people along from one step to the next and then you can improve each step for exponential growth in your business. If you understand what action people take after they see your ad, then it is easier to write your ad. All you have to do is get them to take the next action. And so on until they hand you their money.

Advertiser Missed An Opportunity

I was recently driving home and heard an ad on the radio, now the odd time there are good ads on the radio but often they are not.  In this case an advertiser paid good money for an ad but missed a great opportunity.

It was for a local building supply store who had recently changed their brand such that they now represented a different chain.

The ad, though I don’t remember the actual words, went something like,

“We still have the same friendly service, the same low prices, the only thing that has changed is our name”.

I thought what a wasted opportunity!

Here is a perfect chance to invite people in to the store to see what is different.  Why not project the message,

“not only have we changed our name, but come in and see our new line of…”

“We have recently changed our name and as a result, we now have access to many products we couldn’t get before”

and so on.

You see, if all they do is tell you that they are the same as they were, then why would I go in to the store?  What is the call to action? (There was none in the ad by the way).

The point here is that you need to use every opportunity you can to get people in to your store.  What better time than after a name change, or renovation, or new manager, or whatever.  In fact, any reason you can think of can be a reason to come.  And people like to have a reason.  You give them a reason and they will come.

And the reason should not be “because we are the same as we were before”.

A lost opportunity.

Prospect or Customer?

Often times, you will hear someone talk about getting more customers. The media rep will tell you to advertise “to get more customers”, your business might need more customers.

But see, when you advertise, you do not get more customers. It would be nice if you did. But what you are getting is actually more prospects. You see, that is the difference between a prospect and a customer.

Often times, you will hear someone talk about getting more customers. The media rep will tell you to advertise “to get more customers”, your business might need more customers.

A prospect can be defined (by dictionary.com) as someone who is a potential or likely customer, client, etc.

When someone responds to your ad, they fall into that category. They are a potential or likely customer – or they would not have responded.

A customer (dictionary.com) is a person who purchases goods or services from another, a buyer.

See, the difference is the transaction of actually doing business.

Who cares? Well, it matters actually – a lot! Read on…

It matters because it allows you to separate the two in your mind and in your actions towards each group.

It allows you to look at your advertising differently.

We say there are only 3 ways to grow your business. They are

1. traffic

2. conversion

3. back end

See, getting a prospect, and the act of turning them in to a customer are 2 different steps. Each can be handled, improved, tested on their own.

You can increase your advertising – that will get you more prospects. Chances are, they will continue to convert at the same rate. So if you advertise to 100 people and 10 of them respond to your ad, you have a response rate of 10%. If you want 100 new responses (prospects), then you advertise to 1,000 people.

OK, so lets say that your conversion rate from prospect to customer is 20%. That means that 20% of the people who respond to your ad turn in to buyers. Then, you advertise to 100 people, 10 respond (prospects) and 2 buy (customers).

Why does this matter? Well, because now if you want to double your business WITHOUT spending more on the ads, you have 2 options. You can either double your prospects, or you can increase your conversions. If you can get more people to respond to your ad (by making a more effective ad) then you could get 20 people out of every 100 to respond. That is one way to grow your business. Then if you can close 4 respondents out of 10 (instead of 2), you have doubled your business as well.

If you just refer to advertising as the act of getting more customers you tend to ignore your closing rate and you don’t isolate it and spend time working to improve it. What if you could do both?

If you advertise to 100 people and got 20 responses (instead of 10), and then were able to convert 4 of 10 into buyers (instead of 2), then now for your same advertising dollar, you are getting 8 sales instead of 2.

So look at both steps in this process as separate steps and work to increase rates of both prospects and conversions to sales. Then watch your business grow.