Top 10 Stupid Salespeople Tricks - a Rerun

I was reading Ray Wang's post about trends in software discounting - and it hit me some salespeople excuses such as "revenue recognition" never seem to go away.

So, I have taken the liberty of mashing-up 3 Letterman traditions - his top 10 lists, his "stupid pet tricks", and of course his reruns - to rerun a series of my posts about salespeople slick talk I did in 2005 here, here and here

10) "We want to be a partner, not a vendor". OK, in that case we want a board seat and some equity....

9) " Just wanted to make sure you saw this about competitor XYZ". Usually it is something unflattering from the press or an analyst. I tell my buyer clients to respond: "Attached is what that a competitor sent us about YOUR company". That stops the negative traffic pretty quick. Negative selling usually boomerangs - few buyers find dirt about your competitors that titillating.

8) The opposite of 9 - "we have very worthy competitors" - smothering them with respect. Buyers do not expect you to respect your competitors, just differentiate against them. Focus on features, performance where you are better. You spend a lot of money on competitive intelligence. Share it effectively, positively.

7) "One of us does not belong". The line usually translates to - I cannot believe you are looking at a smaller competitor. When I was at PwC, we were taught to say "we have 40% of the market we choose to go after" as a rejoinder to the objection that our market share was less than 5%. Well, may be it is the buyer's version of "Fantasy Football" when they mix and match and make you compete against a vendor you do not consider a peer. Your choice - you can either compete or not...try not to change the buyer's rules or fantasy.

6) The start up sales pitch: " We do not believe we have any competition". In that case your category may be still immature. Few buyers want to be that pioneering.

5) "Gartner (or Forrester) puts us in the top right of their magic quadrant".  Gartner has many, many quadrants and they change at least twice a year. In a recent deal, three SIs had different quadrants in which they were magically all  in the top right quadrant...

4) "But we do not make margin on travel expenses" - This is a consultant favorite to justify their 15 to 20% travel expenses in addition to fees. During one negotiation given the "no margin" explanation a few times, I told the consultant "But it is real money to my client. He would rather only pay 5%. Propose more local staff, and only fly in critical resources" See more why on long-term projects those additional expenses are budget and productivity killers in my blog on consultant travel.

3) "You are trying to commoditize us" - a common statement during negotiations.  Excuse me, most of corporate America makes 10 to 30% gross margins. Even the offshore vendors are close to 50% gross margin and the bigger software companies all make 70% plus. If there was a WalMart like channel, tech vendors would understand what commodity pricing meant

2) "Discount shock" - "I cannot believe you can even talk about such a steep discount - never happens in our industry" - said a salesperson during a negotiation last year. I emailed him a link to the Department of Justice website which made public several of Oracle's pricing and discount sheets. Sheepishly, he agreed to a higher discount a few days later. Realize there are many buyers who bluff, but a few of us have benchmarks to back us up.

1) "Revenue recognition" - a common excuse during negotiations is "our accountants will not allow a certain concession because it will cause us to defer revenue". A client CFO challenged a software salesman and asked to speak to his Controller about a so-called recognition issue. The issue magically disappeared soon after. We agreed it probably was a "commission recognition" issue rather than a revenue recognition issue.

Next up: Conan, Colbert and Stewart on "Who made Clouds?" :)

Comments

[Kendall Gordan]

Thanks! That was very funny and also accurate...

Kendall Gordan, SE
www.foxfiresoftware.com

[Krishna]

While on #6 - should summarily discard the guy that says we have no competition. The jerk doesn't even know how to google :-)

[Jeff Ventura]

Great post, Vinnie. Couldn't agree with you more. Reminds me of the rant against IT/enterprise software marketing I wrote a few years ago on my personal blog.

I also did a wee editorial on your list on MiPro's blog. Give it a look.

Rock on.

Jeff

[Mohinder Mahal]

Spot on Vinnie! I have personally been a witness/unwilling party to almost all these scenarios in one variation or another and must admit have been guilty of at least one of them myself (#10). I have also been part of a sales team where our esteemed sales leader tried trick #1. I can share with you that at least in our case it was 100% about commission recognition!

I am going to clip this for my records of Dos and Don'ts.

[John Plato]

As a software sales executive, I found your post amusing. I've seen my share of stupid rep tricks in my career, and you laid out a number of them here. Regarding #10 (we want to be a partner), this isn't necessarily a vendor trick, in my experience, but a buyer should ask what that means. A board seat? Probably not. But is the vendor willing to integrate your requirements into their product roadmap? Assign a senior executive sponsor who can back up commitments? Share project risk? A good vendor will do more than just take your purchase order.

[Rajesh Kumar]

Very apt post.

[Anil Kurnool]

Many times I wonder, if you were a CFO/COO/CEO of a SI, how would you take on the buyers...

Just want to know, some thumb rules from your side, so that we (from the SI world) can use, so as not to fall into the category of "sales tricks"...