Todd Caponi is the author of the award-winning book The Transparency Sale. He’s the Managing Director of Chicago’s Venture Scale, a speaker and workshop leader. As principal of Sales Mellon LLC up until mid-2018, he had spent almost four years building the revenue capacity of Chicago’s Power reviews from the ground up as their Chief Revenue Officer, turning it into Illinois fastest growing tech company. Prior to that, he held sales leadership roles with three other tech companies, including Exact Target, where he helped drive the organization to a successful IPO and a 2.7 billion exit through the acquisition by Salesforce.com. Subhanjan Sarkar, Founder, Pitch.Link sat down with Todd to explore how transparency is key to new business.
As narrated by Todd Caponi in an Interview with Subhanjan Sarkar, Founder Pitch.Link for the podcast Bits About Books. If you are interested in listening to the whole episode go to https://bit.ly/3hNBRLw. If you like it please subscribe to the show.
How it all started?
We contracted with a local University, Northwestern University here in Chicago, to take a look at how consumers act and behave when they’re buying something online. And so essentially, when a website is acting as the salesperson. All right, so the research came back, and the second piece of this that I’m going to tell you about here in a second, when I got it, I read it and I immediately realized, wow, if this applies to the B2B world, it’s a game-changer.
And so here was the research. The first piece was, as it turns out, and this is no surprise. We all look at reviews now before we buy anything online. That’s a medium to high consideration that we haven’t bought before. The data said 96% of us do, and I haven’t found the 4% that don’t yet. 82% of us specifically skip past the five-star reviews and go right to the negatives. Again this is when a website is acting as a salesperson. So we seek out the negatives first. And when a product has an average review score between a 4.2 and a 4.5, those products actually sell at a higher rate than any other score, which includes a five. A 4.2 sells better than five. I looked at this and said, all right, this is when a website is acting as the salesperson. What happens in human to human B2B type sales?
It turns out when we lead with transparency and embrace our flaws early in a sales cycle, realizing 82% want the negative first anyway, when we do it in human to human sales, magic happens. Win rates went up, sales cycles shrink dramatically. We work the deals we should be working. We lost the deals that we’re going to lose anyway, but just faster. And we made it really hard on our competitors.
We’ve been teaching our sellers to sell as though we’re perfect forever. Historically, all the sales training I ever received was about, hey, don’t tell them we don’t do this, or don’t tell them this doesn’t work. We’ll tell them about that later when they’re really excited about us or just basically hide the flaws. That’s what really started it. But you combine that with this idea that today reviews and feedback have proliferated their way through everything we do, everything we buy, everything we experience. And that’s true in the B2B space, too. Leading with our flaws sells better than perfection. And then you match that up with the proliferation of reviews and feedback. It tells us that we should be doing it, but we need to do it anyway. We can’t any longer hide our flaws and expect to get away with it.
However, transparency does not necessarily mean, hey, Mr. Or Mrs. Customer, this is why we suck. That’s not what we’re talking about. You got to embrace this 4.2 to 4.5 and lead with your flaws. And if your product is worse than that, you’re probably not going to be around long in business anyway.
I had this theory that, again, we’ve always taught our B2B sellers to sell as though we’re a perfect five. Does positioning ourselves as a 4.2 and a 4.5 work better? And leading with our flaws, does that work better? And so we started trying it out. The first company that I tried it out with was an apparel manufacturer retailer that most of you are familiar with, which is Calvin Klein, up in New York. They were starting an evaluation for ratings and reviews technology. They were going to send out a request for proposal RFP. And then based on that, they’re going to bring us up to New York, to their headquarters to do a full presentation. We reached out to the head of eCommerce for Calvin Klein and asked him if he’s got an hour for coffee since I was in New York anyway. He says yes. So I go over to their office. I walk in, the guy meets me at his floor, takes me back to his office again. I’m under the impression we’re having coffee. He points me to his monitor, by which I should plug in my laptop so I can do my presentation. And I look to my right, and the room is filling up with people. And so I’m suddenly thrust into this thing where I thought I was having coffee. But their expectation was I was doing a full presentation. So instead of doing what they asked, which their head of Ecommerce literally started the conversation – Hey, Todd, we’re looking at your competitor. We’re looking at you. How are you better?
I said, “Listen, you’ve got a bunch of people in here. You’re investing a bunch of time in this evaluation. Can I start with one thing, that our competitors are better than us at? They actually just released an add-on to their solution that we don’t have. And if that’s going to be important, let’s talk about that now. Because if it is and it’s going to be an important decision criterion, we can save everybody a lot of time. You could feel the whole room disarm. The head of Ecommerce was like – Yeah, sure. So you went straight to, Hey, I trust you. Thank you. I literally pitched our competitors’ add-on tool that we didn’t have. And when I did that, everybody in the room looked at each other and they had a little conversation about it. And they’re like, it’s interesting, but it’s not on our radar at all. It’s got nothing to do with ratings and reviews. It’s kind of this add the thing. Okay, Todd, thank you. Is there anything else? And if not, let’s talk about what you guys do.
So I talked about what we did. I went to the positives. Very quickly, the head of eCommerce stopped the meeting, looked at everybody and said, I’ve heard enough of you. And they’re all like, yeah. And everybody is smiling. He kicked everybody out of his office, pulls out his budget, and literally showed me his budget line item for our type of technology and asked me if we can hit it. What ended up happening is two weeks later, they called and told us that they’ve selected us. They threw out their whole RFP process and their whole formal presentation process over this one meeting that we had. And I was like, all right, I think we’re onto something here. And so we kept trying it. And the results continued to be magic around leading with your flaws, embracing transparency, and starting a sales process with that strong foundation of trust, which most sellers are not armed to be able to do.
How did this meeting turn into a replicable process?
It became a couple of things. Number one is because there’s a proliferation of reviews and feedback on everything as a seller, we should be acting like a buyer and going out into the Web and looking at review sites and figuring out, all right, if I’m a buyer, what am I going to find? Like, what are the negative things that I’m going to find when I look? And then working with your marketing team to craft that into a 4.2 to 4.5 messaging. To not go too far, but to make sure that you’re leading with something that that buyer is going to find. And when that buyer does find it and finds that it matches with exactly what you said, their need to go do more homework goes down because there is now this match and this foundation of trust. So that’s really where it started, is you’ve got to get an understanding of what your buyers are going to find and how your competitors are going to sell against you. You could bet anything that our competitor was going to sell Calvin Klein on their add-on, especially since their first beta customer was The Gap, another apparel company.
You know that was coming, so why not lead with it and get it out there? And now when our competitor would then go in and try to undercut us by throwing that add on as a part of it, our buyers are already prepared for that. That’s kind of the starting process is you’ve got to do your research and understand what they’re going to find and what your competitors are going to say and then work on your messaging from there, that kind of embraces that transparency, leads with it. And it’s actually a funny little sign item that I found after I wrote the book is that the supermodel Tyra Banks, she coined the term Flawsome.
Flawsome is to embrace your flaws but know that you’re still awesome. That’s very appropriate for the future of B2B sales – we’re all flawed. No buyer expects or believes that we’re going to be perfect. So embrace your Flawsomeness, present yourself as a 4.2 to 4.5, and watch the magic happen.
Why Change. Why You. Why Now?
If we talk about buyers – we want to seek out the negative first because they’re wired to try to predict what their experience is going to be like. They go through a three-step process, which is they decide whether or not they need to change from what they’re doing today. So why change? Once they do, they decide whether to do it with you or not. So why you? And then once they decide to do it with you, it’s why now? Like, why should I do this now versus waiting six months, twelve months, five years.
From a sales perspective, think about this quote of Antonio Damasio, who is another researcher. He wrote a really interesting book in the late 90s called Descartes Error – “we as human beings are not thinking machines that feel, we’re feeling machines that think”.
We have been teaching our sales reps to lead with logic and ROI and features and benefits. That’s very logical. When we lead with stories and emotions and think about letting a customer see themselves in your stories. That’s how you really drive a smooth path to decision making. Logic is extremely polarizing. How do you actually touch that feeling and emotion centre first? Transparency has a magical way of doing that from a trust perspective.
Data Driven Decisions, Feelings and Scarf.
The decisions are still being made based on a feelings. When we talk feelings, we think like, is it love, is it hate? No. There’s actually a framework for the feelings that drive decisions. Dr. David Rock, who is a neuroscientist, came up with this framework with an acronym called – Scarf.
Scarf are the five different things that drive our decisions. And the S is status. Like, we buy things to get recognized, to get validated, to get feedback. So how other people perceive us. The C is certainty. So we buy things when we feel like we can predict what our experience is going to be like. That’s why we look at reviews and look at the negative reviews first, because we’re trying to predict what could go wrong. The A in Scarf is autonomy, meaning we want things that allow us to maintain or gain control. The R is relatedness, we want to be a part of something. We want to be doing something for the good of the world. There’s a societal element to it. And then the F is fairness, meaning is the effort in terms of resources and dollars, and what I’m going to put into it, what I get out of it is going to be equal or better.
The Scarf model really should be a beacon for many people to think about. How do I optimize for those things in my positioning, my presenting, my prospecting to help buyers make better and faster feeling type decisions.