SPIN Selling - Neil Rackham  ## Metadata - Author: **Neil Rackham** - Full Title: SPIN Selling - Category: #books ## Highlights - 1. *Opening the call*. The classic theories of selling teach that the most effective method for opening sales calls is to find ways to relate to the buyer’s personal interests and to make initial benefit statements. As described in [Chapter 7](private://read/01hvtdppbwzebpsdz3fe8wp122/#ch07), our research shows that these opening methods may be effective in small sales but that they have a doubtful success record in larger sales ([View Highlight](https://read.readwise.io/read/01hwht723yfnvk11pb0smgg3g2)) - 2. *Investigating needs*. Almost everybody who’s been through sales training in the last 60 years has been taught about open and closed questions. These classic questioning methods may work in small sales, but they certainly won’t help you in bigger ones. Later in this chapter I’ll introduce you to a more effective method of Investigating, which we discovered from the analysis of several thousand successful sales calls and from watching some of the world’s top salespeople in action ([View Highlight](https://read.readwise.io/read/01hwht7qa4wzzc02h2y7am1cds)) - 3. *Giving benefits*. Once you’ve uncovered needs, traditional sales training teaches you to give benefits that show how the features of your product or service can be used or can help the customer. Offering benefits in this way can be very successful in the small sale, but in the large one it fails entirely. [Chapter 5](private://read/01hvtdppbwzebpsdz3fe8wp122/#ch05) introduces a new type of benefit that research shows *is* successful in large sales ([View Highlight](https://read.readwise.io/read/01hwht86bs967a0gyh1zn67bhq)) - 4. *Objection handling*. You’ve probably been taught that overcoming objections is a vital skill for sales success, and you’ll know about the standard objection-handling techniques, such as clarifying the objection and rewording it in a way you can meet. These objection-handling skills are fine when you’re making small sales, but in major sales they contribute very little to your sales effectiveness. Successful sellers concentrate on objection prevention, not on objection handling; based on our analysis of how they do it, [Chapter 6](private://read/01hvtdppbwzebpsdz3fe8wp122/#ch06) describes methods that you can use to cut the number of objections you get from your customers by more than half ([View Highlight](https://read.readwise.io/read/01hwht9wbmv5cd2xcrcbc5b7r2)) - 5. *Closing techniques*. The closing techniques that can be effective in smaller accounts will actually *lose* you business as the sales grow larger. Most of the commonly taught closing techniques just don’t work for major sales. [Chapter 2](private://read/01hvtdppbwzebpsdz3fe8wp122/#ch02) describes effective ways of obtaining customer commitment in these sales ([View Highlight](https://read.readwise.io/read/01hwhta63jkac169d9k55182mb)) - **Length of Selling Cycle** Whereas a simple low-value sale can often be completed in one call, a major sale may require many calls spread over a period of months. One of my former classmates selling in the aircraft industry once went 3 years without making a single sale. On the face of it, it sounds like I’m just making the obvious point that major sales take longer. But there’s more to it than this. What’s really important is that multi-call sales have a completely different psychology from single-call sales. A key factor is that in a single-call sale the buying decision is usually taken then and there with the seller present, but in a multi-call sale the most important discussions and deliberations go on when the seller *isn’t* present, during the interval between calls. ([View Highlight](https://read.readwise.io/read/01hwmy292s9ef2zjz80wteqfx3)) - what may work well in the smaller sale can act against you in the large ones. ([View Highlight](https://read.readwise.io/read/01hwmynhnac2wec0ypgkdb4zx3)) -  ([View Highlight](https://read.readwise.io/read/01hwn4sxg9jjpf89wvb3ta2rn9)) - 1. *Preliminaries*. These are the warming-up events that occur before the serious selling begins. They include such things as the way you introduce yourself and how you begin the conversation ([View Highlight](https://read.readwise.io/read/01hwn4vf9218epwhf5mykhm9f0)) - 2. *Investigating*. Almost every sale involves finding something out by asking questions. You may be uncovering needs or getting a better understanding of your customers and their organizations. As we’ll see, this is much more than the simple collection of data. Investigating is the most important of all selling skills, and it’s particularly crucial in larger sales ([View Highlight](https://read.readwise.io/read/01hwn4x5v356fs59djeqcrxe01)) - 3. *Demonstrating Capability*. In most calls you will need to demonstrate to customers that you’ve something worthwhile to offer. Most of us in larger sales are selling solutions to customer problems. In the Demonstrating Capability stage of the call, you have to show customers that you have a solution and that it makes a worthwhile contribution to helping solve their problems ([View Highlight](https://read.readwise.io/read/01hwn4zet06gpw4sh2tpgmgekn)) - 4. *Obtaining Commitment*. Finally, a successful sales call will end with some sort of commitment from the customer. In smaller sales the commitment is usually in the form of a purchase, but in larger sales there may be a whole range of other commitments you have to obtain before you reach the order stage. Your call objective may, for example, be to get the customer’s agreement to attend a product demonstration, or to test a new material, or to give you access to a higher level of decision maker, and in none of these cases is the commitment an order ([View Highlight](https://read.readwise.io/read/01hwn510cjq9dnsj1ngjndm6r5)) - Sometimes the Investigating stage can take up almost the whole call. In selling consulting services, for example, you would have to find out a great deal about the customer’s needs before you could determine whether there would be a basis for a business relationship. I’ve watched an all-day sales call by a management consultant where all but 15 minutes was spent on Investigating. But at the other extreme, I’ve seen calls where the Investigating stage consisted of just one question, the rest of the call being taken up by an elaborate product demonstration. ([View Highlight](https://read.readwise.io/read/01hwp4j6pw8n5hy013vv1ns91m)) - Success in the larger sale depends, more than anything else, on how the Investigating stage of the call is handled. We’ve collected data on Investigating skills from massive studies involving many thousands of sales calls. ([View Highlight](https://read.readwise.io/read/01hwp580d7vh3jf2egzd8xy0nc)) - *Closed questions* can be answered with a single word, often “yes” or “no.” Typical examples of closed questions would be “Do you make the purchasing decisions?” or “Is your existing business more than 5 years old?” In some training programs these are called directive probes. ([View Highlight](https://read.readwise.io/read/01hwp5f8qssveyt4cqvmxsmqjg)) - *Open questions* require a longer answer. Typical examples would be “Could you tell me something about your business?” or “Why is that important to you?” Open questions are sometimes called nondirective probes ([View Highlight](https://read.readwise.io/read/01hwp5g37t5bzgrmf4cfr0mcdv)) - Open questions are more powerful than closed questions because they get the customer talking and often reveal unexpected information.   Closed questions are less powerful, although they are useful with certain customer types, such as the garrulous buyer who can’t stop talking. ([View Highlight](https://read.readwise.io/read/01hwp5mhf27dd2t3x58f7sb4x8)) - Tags: #sales - Even though closed questions are less powerful, you may be forced to use them in certain types of calls—for example, where very little time is available ([View Highlight](https://read.readwise.io/read/01hwp5n1tejkdkgtz5gx1as70n)) - *Situation Questions*. At the start of the call, successful people tend to ask data-gathering questions about facts and background. Typical Situation Questions would be “How long have you had your present equipment?” or “Could you tell me about your company’s growth plans?” Although Situation Questions have an important fact-finding role, successful people don’t overuse them because too many can bore or irritate the buyer. ([View Highlight](https://read.readwise.io/read/01hwrr7b6y4r8wmhvrpjxbda00)) - *Problem Questions*. Once sufficient information has been established about the buyer’s situation, successful people tend to move to a second type of question. They ask, for example, “Is this operation difficult to perform?” or “Are you worried about the quality you get from your old machine?” Questions like these, which we call Problem Questions, explore problems, difficulties, and dissatisfactions in areas where the seller’s product can help. Inexperienced people generally don’t ask enough Problem Questions. ([View Highlight](https://read.readwise.io/read/01hwrr8p8sph3g00qnaj802c54)) - *Implication Questions*. In smaller sales, sellers can be very successful if they just know how to ask good Situation and Problem Questions. In larger sales this is not enough; successful people need to ask a third type of question. This third type is more complex and sophisticated. It’s called an Implication Question, and typical examples would be “How will this problem affect your future profitability?” or “What effect does this reject rate have on customer satisfaction?” Implication Questions take a customer problem and explore its effects or consequences ([View Highlight](https://read.readwise.io/read/01hwrrdg1eses8z8w8xg8z540h)) - *Need-payoff Questions*. Finally, we found that very successful salespeople ask a fourth type of question during the Investigating stage. It’s called a Need-payoff Question, and typical examples would be “Would it be useful to speed this operation by 10 percent?” or “If we could improve the quality of this operation, how would that help you?” Need-payoff Questions have several uses, as we’ll see in [Chapter 4](private://read/01hvtdppbwzebpsdz3fe8wp122/#ch04). For now, perhaps the most important one is that they get the customer to tell *you* the benefits that your solution could offer ([View Highlight](https://read.readwise.io/read/01hwrrs929t0pz4gfct41rzx29)) - *Assumptive closes*. Assuming that the sale has already been made, one asks, for example, “Where would you like it delivered?” before the customer has agreed to buy ([View Highlight](https://read.readwise.io/read/01hws9a8nmytdjxtbe2ne01j3d)) - *Alternative closes*. One asks, for example, “Would you prefer delivery on Tuesday or Thursday?”—again before the customer has made a purchasing decision ([View Highlight](https://read.readwise.io/read/01hws9ajqvxtxx8y3qz1vt63rr)) - *Standing-room-only closes*. One says, for example, “If you can’t make a decision right now, I’ll have to offer it to another customer who’s pressing to buy it.” ([View Highlight](https://read.readwise.io/read/01hws9awbvm373a094b9zcst32)) - *Last-chance closes*. One says, for example, “The price goes up next week, so unless you buy now,...” ([View Highlight](https://read.readwise.io/read/01hws9c8av3rem76jby9nwqhmy)) - *Order-blank closes*. One fills in the customer’s answers on an order form, even though the buyer has not indicated a willingness to make a buying decision ([View Highlight](https://read.readwise.io/read/01hws9e83b1y2jq57e45kbzav4)) - In addition to these bread-and-butter techniques, I found a whole encyclopedia of more exotic closes, such as the Sharp Angle, Ben Franklin, Puppy Dog, Colombo, and Double-reverse Whammo ([View Highlight](https://read.readwise.io/read/01hws9fwjaezbqrr7cza8p2w67)) - *closing as:* **A behavior used by the seller which implies or invites a commitment, so that the buyer’s next statement accepts or denies commitment.** ([View Highlight](https://read.readwise.io/read/01hws9rj5tw2emkxcndmfwydvn)) - Alan Schoonmaker is even more specific about the success of closing. He, too, claims that research shows that successful sellers close more often and use more types of closes. And like J. Douglas Edwards, he favors the magic number 5, saying that “you haven’t done your job if you quit without asking for the order at least five times.” ([View Highlight](https://read.readwise.io/read/01hws9x614mcebggcj2xqfgsf4)) - The consensus among writers on selling seems to be this:   Closing techniques are strongly related to success.   You should use many types of closes.   You should close frequently during the call. ([View Highlight](https://read.readwise.io/read/01hwsa2pe91ykyp7x4ag6pxx2h)) - From what I now know about success in the larger sale, I see closing techniques as both ineffective and dangerous. I’ve evidence that they lose much more business than they gain ([View Highlight](https://read.readwise.io/read/01hwsah7ryr33tk3x9sgyebn9f)) - traditional closing techniques have no place in larger sales ([View Highlight](https://read.readwise.io/read/01hwsahztx4rct81be20mmc643)) - Closing is a method of putting pressure on the customer. And psychologists now understand quite a lot about the impact of pressure on making decisions. Put very simply, the psychological effect of pressure seems to be this. If I’m asking you to make a very small decision, then—if I pressure you—it’s easier for you to say yes than to have an argument. Consequently, with a small decision, the effect of pressure is positive. But this isn’t so with large decisions. The bigger the decision, the more negatively people generally react to pressure. ([View Highlight](https://read.readwise.io/read/01hwvah11eqkw1yhb4cfa5tcyh)) - By forcing the customer into a decision, closing techniques speed the sales transaction ([View Highlight](https://read.readwise.io/read/01hwvc49f5shk7zmqvxyzty62t)) - You normally want *more* time with each customer, not less ([View Highlight](https://read.readwise.io/read/01hwvv91rkb5vw0hz8xbtwve7n)) - My point’s a simple one: In small sales it’s generally desirable to keep the transaction time short; in larger sales—for a whole variety of reasons—a shorter transaction time has few advantages and many penalties. ([View Highlight](https://read.readwise.io/read/01hwvvakq7xnr3tsaj7h367z5b)) - Most people in selling are familiar with the concept of *buying signals,* statements made by the customer that indicate a readiness to buy or to move ahead. Implied Needs are accurate buying signals for small sales; the more times a customer agrees to a problem or difficulty, the more likely the sale. In contrast, Explicit Needs are the buying signals that predict success in larger sales. ([View Highlight](https://read.readwise.io/read/01hye93d21wnbs4tmekgxt82vj)) - INTERVIEWER: In general, what *are* the buying signals that tell you a call’s successful? SELLER: It’s when you hear the customer talking about *action*. Things like “I’m going to overhaul our data network next year” or “We’re looking for a system with these three characteristics.” It’s things like that. INTERVIEWER: You know about the difference between Implied and Explicit Needs. It sounds like you’re saying that Explicit Needs are a better signal than Implied Needs. Would that be right? SELLER: Yes. You can’t just rely on problems, you’ve got to have something stronger. ([View Highlight](https://read.readwise.io/read/01hye9efxwznsgbhxrey4q5tz1)) - What’s your position? How long have you been here? Do you make the purchasing decisions? What do you see as your objectives in this area? You might also want to know something about my business, so you might ask: What sort of business do you run? Is it growing or shrinking? What’s your annual sales volume? How many people do you employ? You would need to understand how my business was operating, so you might ask questions like: What equipment are you using at present? How long have you had it? Is it purchased or leased? How many people use it? What’s the common factor in all these questions? Each one collects facts, information, and background data about the customer’s existing situation. So we gave them the obvious name, Situation Questions ([View Highlight](https://read.readwise.io/read/01hye9p809vmj9h3cf2krv0spy)) - Situation Questions are an essential part of most sales calls, particularly those calls made early in the selling cycle. What did our research uncover about them?   Situation Questions are not positively related to success. In calls that succeed, sellers ask fewer Situation Questions than in calls that fail.   Inexperienced salespeople ask more Situation Questions than do those who have longer sales experience.   Situation Questions are an essential part of questioning, but they must be used carefully. Successful salespeople ask fewer Situation Questions. Each one they ask has a focus, or purpose.   Buyers quickly become bored or impatient if asked too many Situation Questions. ([View Highlight](https://read.readwise.io/read/01hye9y0jwfrcv2dwmhr2ye20f)) - **Problem Questions** Experienced salespeople are most likely to ask questions like these: Are you satisfied with your present equipment? What are the disadvantages of the way you’re handling this now? Isn’t it difficult to process peak loads with your present system? Does this old machine give you reliability problems? ([View Highlight](https://read.readwise.io/read/01hye9zgfhpcyz7bt314pfk57q)) - Questions.   Problem Questions are more strongly linked to sales success than Situation Questions are.   In smaller sales the link is very strong: the more Problem Questions the seller asks, the greater the chances that the call will be successful.   In larger sales, however, Problem Questions are not strongly linked to sales success. There’s no evidence that by increasing your Problem Questions you can increase your sales effectiveness.   The ratio of Situation to Problem Questions asked by salespeople is a function of their experience. Experienced people ask a higher proportion of Problem Questions. ([View Highlight](https://read.readwise.io/read/01hyea0yyqybeak0x532fpspr2)) -  ([View Highlight](https://read.readwise.io/read/01hyea9qsg8c6n338wn31c8nqy)) - Many professional people, particularly those who have to ask a lot of diagnostic questions as part of their work, can quickly and easily learn to use Implication Questions to help them sell. ([View Highlight](https://read.readwise.io/read/01hyf9w5gatvr4wtr3re62j6q4)) - Implication Questions are particularly powerful in certain types of sale. Obviously, as we’ve already seen, the main power of Implication Questions is in larger sales where it’s necessary to increase the size of the problem in the customer’s mind. ([View Highlight](https://read.readwise.io/read/01hyf9xf83qn0cwnbn7px1032j)) - Is it important to you to solve this problem? Why would you find this solution so useful? Is there any other way this could help you? ([View Highlight](https://read.readwise.io/read/01hyfa3rza8xj28wmv15bqx9kq)) - What’s the psychology of Need-payoff Questions? They achieve two things:   They focus the customer’s attention on the *solution* rather than on the problem. This helps create a positive problem-solving atmosphere where attention is given to solutions and actions, not just problems and difficulties.   They get the customer telling *you* the benefits. For example, a Need-payoff Question like “How do you think a faster machine would help you?” might get a reply like “It would certainly take away the production bottleneck and it would also make better use of skilled operator time.” ([View Highlight](https://read.readwise.io/read/01hyfa4hcb82ff1e0dd477hns0))