Traditional selling techniques worked for many years with small sales, defined as something that can normally be completed in a single call and typically involves a small dollar amount.
Neil Rackham believed that the things that led to success when making smaller sales could hurt when making larger sales.
Larger sales will almost always require a greater effort and more time than small sales. Characteristics include:
- Length of selling cycle
- Size of customers commitment
- Ongoing relationship
- Risk of mistakes
Rackham and his team analyzed more than 35,000 sales calls over a period of 12 years and based on the findings, developed the SPIN method, and in 1988 he published SPIN selling.
SPIN techniques proved to be successful and are still in use today. The SPIN strategy focuses on developing solid questions loosely following a particular order, building relationships, and targeting client needs.
Clients have two types of needs: implied (often somewhat vague, noting a concern) and explicit (more clearly identified). Successful sales require helping clients uncover their implied needs and turn them into explicit needs. The SPIN technique can help sales people work with clients to move from implied needs to explicit needs and therefore have more success.
In a typical sales call there are generally 5 steps:
- Opening the call
- Investigating needs
- Giving benefits
- Objection handling
- Closing techniques
The 4 Stages of a sales call
As calls take place, there are generally four stages: preliminaries, investigating, demonstrating capabilities and obtaining commitment.
Many focus on the fourth stage, obtaining commitment, as the most important. This is where Rackham differs. He believes the second stage, investigating, is most important and says successful sellers put their greatest efforts into that stage.
His research was telling him that those NOT trained in closing techniques were better closers and customers had higher satisfaction rates and were more likely to return.
Why?
Ineffective behavior patterns. Sales people can often get hooked on the process they believe they are supposed to be following. They might follow a particular pattern not realizing it isn’t working. They can get stuck on closing behaviors because they are rewarding – at some point they did work, providing gratification and reward. Stuck in that process, they don’t see they are stuck and make changes accordingly.
SPIN
Rackham found a clear statistical association between using questions and a successful outcome. In their analyses they found the more questions asked, whether open or closed, the more successful the interaction.
As Rackham and his team reviewed the 35,000 sales calls they set out to create new positive questioning models to be used in sales. They realized that the most successful sales calls involved lots of questions that seemed to follow a distinct pattern which they called SPIN.
The SPIN model can help sales people work with clients to help them turn implied needs into explicit needs and therefore result in a successful sale. The question sequence taps into the buying process and client’s needs move from implied to explicit needs leading to more success.
The SPIN question sequence generally follows*:
Situation questions
Problem questions
Implication
Need-payoff
* top salespeople were using these four question types during their successful sales calls. Although they most often followed this particular order, they are in fact fluid and can be mixed around to flow naturally during the conversations.
The SPIN Sequence
Situation questions
- Probing, background about the individual or the business used to assess current situation
- Use caution in “fact gathering” as no one wants to waste time sharing a lot of information that can be found by doing a simple internet search
- More situation questions do NOT lead to greater sales; Rackham found that higher numbers of situation questions were asked in sales calls that failed; they tend to be overused by inexperienced sales people
Problem questions
- Use to probe for problems, current needs, challenges or pains
- These questions succeed more often in smaller sales; no correlation between use of problem questions and larger sale successes.
- These can help uncover and provide information to build the rest of the sale and uncover areas of opportunity
Implication questions
- Probing on effects, consequences, and issues regarding the client problem
- Take the identified need, perceived to be small, build it up into something larger
- These questions more often lead to success in larger sales and help to build the client’s perception of value
Need-Payoff questions
- Use to probe about the value or usefulness of solving a client problem
- Focus client on a solution vs a problem, and turn it around so client is telling you the benefits of the solution
- These questions are strongly linked to success in larger sales, and are best when used with influencers and/or the primary decision maker
- They can have a negative impact on the sale if they’re too obvious
- They help to reduce objections – they’re already starting to buy in to the solution; can help them begin to rehearse selling internally as they’re already recounting benefits
SPIN SELLING – The Four Stages
Stage one: Preliminaries - opening the call
- Conventional openings:
- Play to client’s personal interest
- Never a bad thing, but more challenging in urban environments.
- Personal loyalty waning in popularity
- Time is crucial, some prospects put off by “fishing” to find personal interests
- Open with a benefit statement
- With larger sales you’re typically doing multiple calls with the same person – can’t keep using same technique
- Opening this way can force you to start talking about product details too early in the conversation before you’ve had a chance to build value
- New technique:
- Focus on objective – establish your role as seeker of information – let the client know your job is to ask the questions. Can help you avoid getting into detailed discussions on the products and services too early
How to make your preliminaries effective:
- Get down to business. Don’t spend too much time on pleasantries.
- Don’t talk about solutions and capabilities too early in the call – you’ll bring about objections and lead to an unsuccessful sale
- Concentrate on the questions – plan them out before the call
Stage two: Investigating (successful sellers put their greatest effort into this stage)
Uncover client needs in larger sales
- Salesperson needs to acknowledge there are different needs when it comes to large vs small sales; those differing needs require different questioning skills and approach
- Consider how the customer needs develop – it generally starts small and grows larger
- Two types of needs – implied (often vaguer, noting a concern) and explicit (more clearly identified)
- Explicit needs more often lead to a successful sale
- The goal of the sales process should be to help clients uncover their implied needs and turn them into explicit needs
Stage three: Demonstrating capability
Giving Benefits in Major Sales
- Features (facts and information about your product/service) & Benefits (how the feature can help or solve the problem) are common ways to present a product to a client
- Features usually have a positive effect on smaller sales but don’t seem to impact larger sales positively or negatively and are typically more important to the user themselves rather than the decision maker
- Advantages (one type of benefit) typically have a positive impact on smaller sales, but primarily early on. They have little impact if used too late in the selling cycle.
- Benefits can show a client how a product or service can meet an identified explicit need and have a positive effect on both small and large sales.
Stage four: Obtaining commitment
Four successful actions
- Giving attention to investigating and demonstrating capability
- Checking that key concerns are covered
- Summarizing the benefits
- Proposing a commitment, two options;
- advances the sale – helping it to move forward in some way
- propose the most realistic commitment the client is likely to give at that time – avoid pushing them to something unrealistic
“my objective is never to close the sale, but to open the relationship”
Using the SPIN model
The customer’s problem (Implied Need) is the heart of the issue. Begin by realizing you are there as the problem solver. Before you begin:
- Identify 3 possible problems the client might have for which your product or service would be a solution
- Write down possible Problem Questions that could be asked to uncover the 3 problems you’ve identified
The SPIN model was originally developed in 1988 and is still used by many today. The basic tenets of these techniques are timeless but should be updated to fit today’s selling environment. For example, much of what would have been uncovered during the preliminary and investigating stages of a sales call can be uncovered by doing a little internet research before engaging with the client.
Happy selling!