Josh Ward presented a session at ProductCamp-Austin about applying open source principles to sales and marketing. Here are my notes and thoughts:
My favorite part of the presentation was a story about the early days of Tupperware, when sales people peddled the plastic containers door-to-door. At a sales meeting, one rep received the award for highest sales and was asked how he managed to best the runner-up by 10x. He explained that he took a hammer with him on every sales call. He hit the Tupperware with the hammer and customers were ‘sold’ – no sales pitch required. From then on, the company provided every sales rep with a hammer along with his starter kit.
At the next meeting, the same rep again bested his nearest competitor by 10x. Everyone was stunned and asked him how he’d done it. He said, “Simple. I handed the hammer to the customer.” The moral of the story: showing is better than telling, and experiencing is better than being shown. Let your customers experience the benefit of your product for themselves, and you spare yourself and them the spiel.
Josh concluded that, metaphorically speaking, you should give away the milk in hopes that customers will buy the cow. This works well in some cases, such as hosting free webinars that showcase your expertise, offering free consultations that give potential customers a taste for the benefits your services can provide, or providing free trials of your product.
However, many businesses are successful giving the cow away for free. LinkedIn is an example of a company that provides the vast majority of functionality is free. It makes money on upgrades to premium accounts, fees for posting jobs, and advertising. Imagine if LinkedIn suffered from a stingy “free milk only” philosophy and non-paying users were only be able to create their own profile, not view other people’s. LinkedIn would not have 85 million users.
In any event, Josh had some handy sales tips and tricks:
- Talk to customers about what they know and care about – they buy the drill bit for the hole it will make
- Potential customers must have two of the following three characteristics: healthy budget, exciting project, nice people – and ‘nice people’ must be one of the two
- Don’t let potential customers haggle over price – you want to work with people who value your expertise
- Fire your bad customers – they are like natural disasters and your business is that little farmhouse in the distance
- Sell the outcome – don’t say “increase social media presence”, say “build brand awareness among adults aged 2o to 35”
When all else fails, hand the customer a hammer.