I once witnessed a first-time entrepreneur pitch his very early stage startup, vision, and product with so much passion, precision, and authority to a well-recognized Global consumer goods brand that the CIO agreed to a POC (proof of concept) even before the entrepreneur finished his 30-minute pitch! For a large multinational to take this leap of faith was no small feat – especially considering the relatively early stage of the startup. I knew the product was revolutionary and the vision was indisputable, so at the time, I thought that success was also inevitable. However, as I facilitated more conversations with other CIOs and the entrepreneur started sending his newly-hired salesperson in his place, I saw the salesperson flounder time and again: he was unable to secure follow-up meetings, let alone win POCs. Clearly, a revolutionary product and grand vision were not enough: a carefully crafted and delivered sales pitch is a very critical component of the sales process.
Through this and other such experiences, I have started identifying the differences between a great sales pitch and a mediocre one. At Lightspeed Venture Partners, I have the privilege to coach our portfolio startups on their go-to-market strategies and connect them with CXOs from Fortune 1000 enterprises. The smallest of differences in the sales pitch alone can be the difference in getting a POC right after a meeting or getting punted for a “let’s stay in touch” (read: I’m not interested) treatment.
Whether you are a first-time tech entrepreneur trying to land your first deal, an aspiring business development candidate, or a seasoned sales leader, I hope this series can help you land your next customer (and many more). While a sales pitch is both an art and a science with a splash of your genuine personality, I believe that several common characteristics are almost always present in a successful sales pitch. Over the next few months, I will break this topic into several blog entries, broken out by the sections that I think are critical in getting to a Yes:
Preparing for your (first) sales meeting: The more work you can put into preparing for your pitch meeting, the better your odds will be of success. Pitch preparation ranges from researching the company to personalizing the presentation for the prospect to understanding each individual’s pain point, as well as understanding the politics among the key stakeholders.
Pitching effectively: I break down a successful pitch into three key sections and discuss how much time to spend on each section: Introduction & Qualification, Company & Product Overview, and Demo & Discussion. I will also offer some specific best practices every salesperson should know.
Following-up effectively after the pitch: Here I’ll share some thoughts on the appropriate follow-up techniques, timing, and approaches.
So let’s get started: You’ve worked your network, leveraged Google and LinkedIn, and attended industry conferences to turn those cold leads into warm ones. Or perhaps, your top-tier VC has helped facilitate a meeting with a prospect. Regardless of how you arrived here, congratulations on finally landing that elusive initial prospect meeting! Now, the most important part of the process starts: preparation!
The Most Important Part of Your Pitch Happens Before Your Pitch Even Begins
Preparing for your meeting
“Give me six hours to chop down a tree and I will spend the first four sharpening the axe.” – Abraham Lincoln
Preparation is arguably the most important part of the sales pitch, yet many salespeople stumble out of the gate and effectively lose the sale before getting to a demo. If you think that you can use your pre-packaged pitch deck that Marketing put together last year, your chances of winning the deal are no better than betting on a random horse at the Kentucky Derby. Below are some of the best practices I have witnessed and preached to my teams to effectively prepare for a sales pitch:
Research, Research, Research
Before you walk into any sales pitch, you should understand your prospect’s business model (how they make money) and their key initiatives. Depending on how deep your product penetrates the company, and how many stakeholders are involved, you’ll want to spend anywhere from a few minutes to several hours understanding the company’s business. At Deloitte, we often spent several days fully understanding a client’s business model, industry, and competitive landscape before an initial sales conversation or a new project. Conversely, at E la Carte, I started out spending several hours to understand the customers’ financials, missions, and business models but I quickly realized that I never engaged in those discussions with my prospects. So I shaved off preparation time by focusing on researching specific topics that IT and operations executives were focused on (e.g., new menu items, promotions, other vendors). If you’re unsure, err on the side of over-preparation and then fine-tune as you learn more.
Understand the personalities and the political landscape
There are many great books on identifying the Decision-makers, Influencers, Buyers, Champions and specific sales tactics. I think you should read them. A particularly good book for any up-and-coming entrepreneur or salesperson is The Challenger Sale: Taking Control of the Customer Conversation by Matthew Dixon. Equally important is understanding the interpersonal dynamics of the group: Do they get along with each other? What are the team dynamics? Who is the unspoken leader? Who can break or make your deal? Who is friendly and has enough influence on the group that you can try to win over? If a VC is facilitating the intro meeting, you can ask the VC for this info. If you’re self-sourcing, get creative in finding the information beforehand. Salespeople at your prospects could be invaluable sources of information because, well, let’s face it, salespeople love to talk! If you’re unable to gather this information beforehand, you can still gather critical information on people’s working styles and relationships by paying attention to their body language and verbal cues.
One of the best books I have read on the topic of identifying work styles while in a meeting is People Styles at Work…And Beyond: Making Bad Relationships Good and Good Relationships Better by Robert Bolton. The beauty of this approach is that you can easily identify a person’s work style within 30-60 seconds of talking to him and adjust your own style to complement his. This can be extremely useful – especially if you’ve never had an interaction with the prospect before. You waste valuable time and lose the sale if you talk numbers to an “amiable” or give an “expressive” only two minutes to make his point.
Make it easy for your prospects to buy
You probably have a pretty good understanding of the potential use cases for your product. When delivering a sales pitch, you should always understand which use cases are most relevant to your specific prospect. Drive your presentation to address these use cases so your audience can relate; make it easy for them to buy your product rather than trying to sell it to them. One of the best pieces of advice I received was from my first boss at The Toronto Star, where I started selling newspaper subscriptions door-to-door at the age of 13: “People hate being sold to but they love to buy, so figure out how to get them to buy what you have.” Although I probably never put this advice into practice at the time – my frail frame and raw enthusiasm were likely more persuasive to people answering my knocks during dinner time – this is a truly important principle to keep in mind and utilize during your pitch. At E la Carte, when I first made contact with the Johnny Rockets team, I tried to sell them on the standard use cases that we’d established and sold to many of the other accounts. It was usually a matter of finding out which of the four to five key benefits mattered most to them and then focusing on that key benefit. However, none of those use cases resonated with Johnny Rockets and my sales pitch not only fell flat but I practically killed the opportunity. By chance, when I re-engaged with another team member six months later at a conference, I probed into the specific use cases that could be applicable to Johnny Rockets and found one that was so obvious that I’d completely missed originally: replacing their classic but aging jukeboxes with digital jukeboxes integrated into our product. And voilá, we were off to the races!
Prepare for every meeting – not just the initial meeting
If you have prepared well in sharpening your axe, cutting that tree will be much more efficient. And by the way, you should prepare for every meeting with your prospect, not just your initial meeting. At E la Carte, for example, after we successfully re-engaged following my initial outreach blunder, we were in a very competitive battle for Johnny Rockets’ business. We knew it would be a long slog for either startup to win the deal so we could use any advantage we could get. As I prepared for our mid-POC review, I came across an article introducing Johnny Rockets’ new menu items. With the help of our Product and Engineering team, we incorporated those new items into my presentation and showed the Johnny Rockets team how the new menu strategy would fit into our product. The client was impressed that we not only knew about the changes but also were able to speak to them, whereas our competitor had not done so. These seemingly small tactics helped us win a multi-year, multi-million dollar contract, even though our competitor had achieved comparable or better results on some other key criteria.
Preparation is an important first step. But you must also pitch effectively and capture your audience. I will discuss specific strategies for pitching effectively in my next post.
“By failing to prepare, you are preparing to fail.” – Benjamin Franklin