Do I mention the competition first?
Posted by Geoff Alexander on Mon, Apr 27, 2009 @ 01:29 AM
I regularly monitor a few sales websites, and a good question was posed the other day about whether to openly discuss the competitor's solution, or totally avoid mentioning the competition. I'm pretty opinionated on this. Here's my answer, followed by a brief explanation:
"I will never be the first to bring up the name of a competitor. But I will always ask "What other solutions are you considering?" I not only want to find out who is competing with me, but also want to get a sense of the prospect's global ideas about solving the problem. Also, be wary that your prospect may have already made a decision to go with the competition, but is "shopping" you to get price data to use to lower the price of the already-chosen solution. When I was purchasing solutions myself, I did this to salespeople all the time. I've blogged on this shopping practice, and what to do about it at http://www.alextrain.com/inside-sales-telesales-tips-blog/bid/5564/RFP-Hazards-Are-you-being-shopped-by-Purchasing-Agents-Here-s-how-to-fix-it "
I'm a real believer in never bringing up the name of a competitor before the prospect does, and it's just one of the things I teach in my telesales training courses. When you do that, you place the competitor on a peer level with you, and I can almost guarantee that if your prospect hasn't talked with your competition, he or she almost certainly will right after you've hung up the phone. In one fell swoop, you've brought your competition into the sales picture.
Occasionally, the prospect will ask who you compete with. I hope you've already asked great qualification questions that will uncover reasons that your solution is the best in the marketplace for the prospect, and you'll have a unique value proposition that argues that you have the best solution. So my response to the question about my competitors goes something like this: "There are a number of companies competing in this space, Jerry. Based on what you've told me, we're the one that is by far your best solution, for the following reasons [name them]. The reason I work for [my company] is that we provide the best solution in the marketplace, and my customers get exceptional support and get taken care of really well. If I thought any of the companies that compete with us were better, I'd be working for them."
Savvy prospects (and they're all savvy) hunt around the web for different solutions, and mostly they're testing you to see how you'll respond to the "competition" question. Going back to the days long ago when I was a purchasing agent myself, I'd always ask every vendor salesperson who he or she competed with. Many of the salespeople weren't sophisticated enough to provide an answer like I gave in the paragraph above. So I'd call 5 or so vendors, get the names of the competitors from them, then rank those competitors based on the number of times they got mentioned. Much of the time, I'd choose a vendor based on that ranking, then negotiate a lower price based on the price data I'd gotten from the others. Don't you fall into this trap!
So now you've got a great way to handle the "competition question" and ensure that you're dealing with future price negotiation issues at the same time. Add it to your Best Practices Playbook. And if you have another way of dealing with the question that's been effective for you, tell us about it!
Next week's blog post: What to do when your competition is cheaper (and maybe better!)