TORONTO, Ont. – “If you ain’t different, you better be cheap.”
That was the message PeopleWorks founder and former trucking company executive Bob Flynn delivered to delegates at the Ontario Trucking Association’s annual convention.
Flynn held a two-part seminar on behavioural differentiation – a person or company’s ability to separate themselves from the competition through their behaviour.
“It’s growing increasingly difficult to differentiate yourself,” he said, adding “This is not about ‘smile and be nice’ customer service.”
Too often shippers are tempted to make decisions based on price alone. It’s an age-old problem facing the trucking industry, as fly-by-night operations steal business from safety-conscious and compliant fleets. However, employing bevahioural differentiation techniques can convince a shipper to make buying decisions based on more than just price, Flynn stressed.
“The sales pitch is dead,” he pointed out, noting nearly all trucking companies will show up and give the same sales pitch with four-colour brochure in hand. “With the sales pitch, you’re reciting the same thing your customers are saying. The more competing firms claim to be superior, the more they look the same, so then (the customer) says ‘Let’s get these guys into a price war’ and we’re driving them to it!”
Studies have shown most companies do very little to differentiate themselves from their customers, while others behave in ways that positively or negatively differentiate themselves.
There are two golden rules to behavioural differentiation, Flynn said.
“We must learn the customer’s issues and we must focus only on the customer’s issues,” he said.
A Strategic Account Management Association (SAMA) survey found customers had the following to say about suppliers that demonstrated positive behavioural differentiation: Knows my business as well as their own; Shares private information such as their company’s future plans; Has a customers’ customer strategy; They study our industry and our company; and They add value at every contact.
Flynn breaks customer groups into three categories: Opportunistic customers; core customers; and key accounts. Opportunistic customers make decisions strictly on price. Flynn said you should be constantly abandoning the lower 10% of your customer base, and opportunistic customers would likely fall into this category. If you don’t want to turn your back on the business, take as much out of the service as you can and see if you can find a way to make a profit, he suggested.
Core customers will pay a premium for your expertise. You need to have quality face time with these customers and strive to learn as much about their business as you know about your own, he advised.
Finally, key accounts are the bread and butter of your business.
“You can grow with them and vice-versa,” said Flynn. He advised fleet managers to ensure they have a ‘zipper relationship’ with these accounts, where your president deals directly with their president, your operations manager with their operations manager, right on down the line.
“Eight-six per cent of Fortune 500 companies have a key account management process in place,” Flynn pointed out.
In order to differentiate yourself from competitors, you have to: Mitigate your own weaknesses; Neutralize your competitors’ strength; Highlight your own strengths; and Ghost their weaknesses (by ethically knocking your competitor).
“We have to assess where our competitor is vulnerable relative to every deal that comes down,” he said. As an example, Flynn recalled a time a construction company lost a bid on a major airport expansion project because it was underbid by a significant amount. The customer was able to point out to the airport authority that the lowest bidder uses a high percentage of contractors, which inevitably leads to project delays and cost overruns.
Planting a seed of doubt can be an effective tool, Flynn said, because “A confused mind says ‘No.'”
One way to differentiate yourself from the competition is to place an emphasis on listening. Listening is 50% of Flynn’s sales communications model and ‘asking’ represents 40%. Informing should only occupy 10% of the model and should only relate to the customers’ issues.
“A customer’s number one complaint is that the sales people talked too much,” Flynn noted from a recent survey.
Most salespeople have an ego that drives an overwhelming desire to talk, Flynn pointed out. Instead, they should ask one question at a time, wait for an answer and listen strategically. Talk about your customers’ issues and find out how you can provide valuable information or guidance.
“Provide value-added information – facts your customer was not aware of,” he urged.
One important question to ask is: “What are you considering now and what have you tried in the past?”
This could save you the embarrassment of pitching an idea the company tried unsuccessfully in the past.
Flynn said to research the company you are approaching and be sure to set your questions up, such as by discussing the research you’ve done.For more information about PeopleWorks, visit www.pworks.info.