What are the key
attributes necessary for long-term success in sales and marketing throughout
the world? We know that the "stars" actually generate 1,600
percent more commission revenue than "average" producers.
No, this is not a typo. It is a significant difference. This
article was developed by modeling hundreds of highly efficient and effective
producers and codifying their conscious and unconscious behaviors. As
you read this article you will see things that currently describe yourself,
but may also read a few things which people are doing which may enhance
your personal style/abilities.
The "80-20 Rule" results in a 1,600% Difference
The 80:20 rule
seems to apply to many areas of life - certainly to sales production.
As most would agree, 80% of our commission revenue is derived from 20%
of our clients. (Looking around many businesses, my associates and I
have noted that many sales representatives spend most of their time
and effort with the least profitable.) In the financial services industry,
for example, most financial services firms get 80% of their commission
revenue from the upper 20% of their producing representatives. These
reps tend to be members of the top recognition clubs of their respective
firms. This is seemingly true in every industry - worldwide - that we've
been able to study.
There are some
interesting ratios that are derived from the 80:20 rule. Top salespeople
are generating 16X more commission revenue than average brokers! [Here
is the computation: Assume that $10 in a company's sales revenue is
divided among five sales representatives. One salesperson (representing
the top 20% of the firm) has generated $8 of the $10 (representing 80%
of the total revenue). The other four have generated the other $2 in
revenue or $0.50 each. Thus, the star performer has produced 16X more
revenue.] Top producers/representatives aren't 16X smarter, more
intelligent, efficient, better-looking, deserving than the others. Yet,
they are paid as if they were. What are the differences that
make the difference? We call them "The 2% Differential."
The 2% Differential
Over the past 20
years we have had the opportunity to analyze the characteristics of
star and have noted that there are certain key traits which are shared
by the most successful representatives. In one of my books devoted to
the financial services industry, The Broker's Edge we call it
"The 2% Differential" and devote the majority of the book
to how, specifically, these top representatives actually "do what
they do." These techniques also form the basis of many of the courses
The key characteristics
fall into four broad categories. They are briefly explored here and
discussed in greater depth my books and courses. The key characteristics
- Business Management
- Personal Motivation
Placing the needs of the client first and being concerned for the client's
well-being is paramount to this mindset. Top producers realize that
their primary responsibility is to help clients identify, define
and achieve their goals. They actively try to help clients get what
the client wants and needs.
Contrast this attitude with reps whose primary goal is to generate commission
revenue for themselves and their companies. We can all intuitively tell
when someone is trying to help us and when a salesperson is merely in
it for the money. While there is nothing wrong with making a sale -
it is the underlying attitude that makes the difference. If the client/customer
is seen as a "cash cow" than relationships are by definition
short term. The client will choose another vendor quickly and rarely
give any referrals. Certainly, he or she will not become your "advocate"
and try to help you in your business.
One of the reasons that you have long-term relationships with clients
is the innate desire to be of service.
While the consultative selling / "I care" attitude is important,
it also hinges upon a series of important skills which are essential
for quality business relationships. These essential skills include:
skills: How to quickly establish rapport with people so they feel
confident in your competence.
skills: Explaining complex topics in ways that a client can both understand
and appreciate. This also includes insuring mutual understanding.
- In-depth needs
analysis: Discovering the multiple needs that most clients have and
designing a solution to help them obtain their goals.
the psychological needs and makeup as well as the particular "buying
motivations" of prospects and clients: Realizing that people
buy for their reasons, not ours, top performers intuitively modify
their sales presentations to match the client's thought process. Matching
such processes dramatically reduces resistance to our suggestions.
- Effective selling
techniques and strategies: Making presentations in a persuasive manner
so clients can make "informed decisions" and feel good about
- Effective methods
for getting referrals, etc..
The best representatives
are perceived by their clients as having a good knowledge of their industry
and rely upon their representatives for ideas, information, and decisions
that will impact the client's purchases. This knowledge includes knowledge
of the specific features, benefits and advantages of different products
and services (and their appropriateness.
of most top producers is they have a viable business service philosophy
and are able to communicate this philosophy to their clients.
financial representatives think of themselves as owners of their own
franchise, while less efficient reps think of themselves as employees
of their firms. These high level producers "run their business
like a business" and are very careful regarding time, energy, and
resource allocation. They generally have a formal or informal mission
statement, a strategic plan for attaining their objectives, know how
to make effective goals and then monitor performance (their own and
others) relative to the attainment of their objectives.
Culling and Cloning
your book of clients and understanding the characteristics and profile
of ideal clients (results from a demographic study of their business)
is an essential element of business development. Again, the 80:20 rules
applies, yet, too many reps spend the vast majority of their time on
the smaller client. Large increases in productivity can be expected
once we spend our time in a highly productive manner and concentrate
on the 20& of our clientele generating the majority of commission
also include getting referrals and financially profiling other clients.
Finally, developing other members of your team allows you and your firm
to increase account penetration.
The ability to maintain
ongoing motivation over the years is partly a result of effective goal
setting, having a strategic plan, and having a formal or informal mission
statement which are a primary focus of characteristic #3. Highly successful
financial representatives have stood the test of time while most others
drop out, burn out or attain mediocrity. The ability to handle stress
is also a key differentiating factor. Exit interviews with numerous
representatives have indicated that the primary reason for leaving the
business (a 80% dropout rate within the first five years in the brokerage
business) is stress
of the correct mindset + professional knowledge + effective business
management skills + maintaining long term motivation results in the
stellar performance of this elite group of financial consultants and
differentiates them from the average broker.
The 2% Differential
represents minute, yet important, differences that define the beliefs
and behaviors of the top performers lead to quantum differences in productivity.
Identifying the characteristics of our personal work style and ethic
allow each person to initiate a program that will raise them to the
next level of productivity while helping their banks increase account
penetration and helping their clients attain their financial goals.