The 2 Percent Difference Between Winning and Losing a Deal
This month’s article will examine The 2% Factor. Summed up, this is basically the minute margin (historically 2 percent) between winning and losing. There are a number of factors that will influence your ability to be the one on the winning end of this 2 percent variable, and it is up to you and your sales team to know how to tilt the scale in the direction that sees you come out the victor. We will look at ways to use proven techniques and tactics in a way that alleviates any guessing or luck, rather equipping you with the information needed to put you at the head of the pack.
Ease of Recall
Human beings have always looked for the quickest and most efficient ways to make life changing decisions. And while the days of running from predators and hunting and gathering as our only means of sustenance may be long gone, the need to make informed and timely choices remains. Researchers Amos Tversky and Daniel Kahneman looked at systematic bias and heuristics (rules to inform judgements and decision making) and identified thirteen cognitive biases that come into play in terms of decision making. When examined beside software demos and video content, there are three that stand out as applicable and important to our field. The first is ease of recall. It has shown to be incredibly advantageous to couple one “unknown” with a “known.” For instance, giving a client something they are familiar with, all while pitching a service that will improve their experience, causes your demo to stand out. This connection enables the client to more easily recall your demo later, as it partners your product with something that they know.
Conjunctive and Disjunctive Event Bias
It is important to consider conjunctive and disjunctive event bias. Humans generally tend to be biased toward overestimating the likelihood of conjunctive events, or the way that a product or feature could lead to a strategic initiative. In other words, we overestimate the potential good outcome in our decision making, while often underestimating the probability of disjunctive events. Strangely, it has been our experience that sales teams do not often enough implement the power of the conjunctive bias. If teams use this method for influence, they come away with an identifiable advantage over the competition. In targeting the conjunctive bias, it is important to remain credible/relevant, to disrupt customer logic, and to lead back to your strengths. In essence, it is advisable to play to the conjunctive bias, as long as you are doing so honestly and with fidelity.
The bias of anchor adjustment sees a trivial factor having a profound effect on our decision making, especially if it is the starting point for our adjustment making. What may seem trivial to you as far as overall solution and value can possibly be the key in the final decision for stakeholders. It is important to establish value, and to give stakeholders something to hold on to. Statistics are powerful anchors for clients and allows for an adjustable gauging. In those moments, you are no longer working against the competition, but against the stakeholder’s status quo.
Stakeholders often fall into the trap of confirmation bias, working hard to find information that supports their own opinions and beliefs, regardless of evidence to the contrary. Most people tend to be uber confident to a fault regarding the infallible nature of their own judgment and allow emotions to dictate decision making. It is important to remember that the stakeholder has probably already researched your solution, looked at your website, or studied your stats. They’ve compared you, contrasted you, and slightly judged you. When they finally make the call to get the few “unanswerable” questions answered, it is time to couple strategy with knowledge and control over their cognitive biases. Focus on learning their needs and desires while establishing conjunctive and anchoring bias.
It is important to always remember that the margin between you and the runner up will be a slim one. Lean on what you’ve learned regarding biases and establish yourself and your team as a contender willing to go the distance to personalize encounters and maximize stakeholder experience.
About the author
Bob Riefstahl founded 2Win! Global on the simple concept that if we focus on more than best practices and correct our bad practices (as Bob calls them, “Crimes”) then we separate ourselves from the competition. Bob is a thoughtful, practical senior executive with a passion for helping pre-sales professionals advance their careers and their lives.