When you ask customers to switch from an existing vendor to you …
Do you offer to do ALL the work?
The data mapping?
If not, imagine all the friction you could remove if you did
— Jason ✨Be Kind✨ Lemkin (@jasonlk) December 30, 2021
So had a chance not too long ago to observe some of the worst sales processes of all times.
What happened? Well, first I wrote a small piece on a challenge we had with a piece of software. And I was then inundated with emails, tweets, and LinkedIn posts from competitors telling me to look at their oh so wonderful product. Then right around the same time, a terrific company that produces software in the investment space emailed me almost a dozen times over the past weeks trying to steal the business from a competitor we currently use.
Both did represent genuine opportunities to steal some business. There was a real chance there to take our business away from another vendor.
And yet, all the pitches from competitor vendors were the same — and just plain terrible. “Have you heard of us? We’re better!” or “Have you looked at Vendor X? We’re better!” or “Can we do a call to tell you about us? Let’s switch!!” or “Let’s set up some time so I can show you our product!”
Well, you know what? I don’t have the time. I don’t have time to figure out what is “better” about your competitive solution, if anything at all. That’s your job. If you want to steal the customer.
The ROI, pitch, solution, collateral approach just have to be different from an ordinary low-effort sales blurb to steal a deal.
Let’s walk through what works a lot better. Because you can steal deals from competitors. All the time. But you have to do it right:
- First, you need a hyper-tailored approach. You have to ABM it. Do the work. Figure out how they are likely using your competitor today, and outline 3-4 clear ways you can help them do better. 3-4 critical features, or integrations, or gaps you fill. Learn their business process as much as you can from the internet, or at least guess based on the website and what you know of customer use cases for similar customers. Guess about 3-4 amazing attributes you have the competition doesn’t that this prospect would care about.
- Second, tell them you will do the work to switch them. If they switch vendors, who is going to rewire things? I have to do it?!! Will you do a free pilot to help? What’s involved in a switch? Ignoring the large soft costs to making a change is just ignoring a key elephant in the room. Address it head-on.
- Third, have a great set of clear collateral on you vs. the competition. Make it crystal clear. A website and tear sheet that makes it clear not just why you are a cool vendor, but why a switch is worth it. Switching has very high soft costs. The bar, in many ways, is much higher than picking a vendor from scratch. You have to deliver significantly more value than the competition to really incent a switch. And more value precisely tailored to my needs.
- Fourth, do buy-out deals. Do ’em. You have to do these to minimize friction. If the prospect has signed a 2-year deal with the competition, and they are 9 months is … you have to give them 15 months free if they sign with you for a year. Sales doesn’t always love buy-out deals. But Zoom does them all the time when folks want to switch from WebEx and GoToMeeting. Why? Because Zoom is obsessed with customer happiness. Part of that is not making a customer pay twice if they switch. And it also dramatically reduces friction in a deal. If you have my back financially if I switch, that’s one less big headache for me. Take more friction out of deals, and more deals close.
- Fifth, on commissions – pay up. Stealing a deal is more work than a normal deal, and can take longer. So incent the team to steal deals by paying up if they do get a customer to switch.
There's an app right now up for renewal we'd switch to the competitor … but I'm not sure I have the energy to reach out myself
But … imagine they had reached out proactively, and tracked the renewal
I'd probably sign
Are you doing this?
Are you doing it well?
— Jason ✨Be Kind✨ Lemkin (@jasonlk) December 5, 2022
Very few line-of-business owners have time for coffee just to talk about other vendors. Not unless they are so unhappy that they are already sourcing alternative vendors on their own. In which case, maybe you can use a normal sales process.
But if you want to steal a customer, go the extra yard. Take the time and do the research to make the pitch perfectly tailored to what they need. If you want to steal a deal from a competitor, you have to do as much of the work for the customer as you possibly can. And then, if they are ready to move — don’t make them pay twice.
(Note: an updated SaaStr Classic post)