4 SPIN Selling PDF

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Notes on selling for Professor Fabrize...

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SPIN Selling

By now you will have read and understood the first five chapters of Neil Rackham’s SPIN Selling. What follows is a brief overview of the types of questions and how they operate together. They are not meant only as a supplement to the book and do not contain all of the information in it. Students are strongly advised to read and understand all of the assigned chapters.

Situation Questions The first questions you will ask are to help establish the context. They help you gather the facts and the background about the client’s situation. Situation questions only benefit you, not the buyer. Most often, they will end up boring the buyer. Because of this you want to use as few of them as possible.    

What type of copier are you using at this time? How long have you been using this type of copier? What percentage of your staff use it? How do your staff use it?

The purpose of situation questions is to help you find out where the client may be having a problem.

Problem Questions Problem questions help salespeople begin to get to the heart of the matter for the client. Salespeople use problem questions explore difficulties with the prospective client’s present situation. They also help the salesperson uncover the client’s implied needs. Remember that an implied need only hints at the problem that the client may have. The client may not

SPIN Selling

see the situation as a problem. They may see it as just the way that they have always operated. Below are some examples of problem questions.   

Are you happy with your equipment? What are the disadvantages of your system? Does it have reliability problems?

Problem questions can be used successfully by many sales people of who do small sales, such as selling cars. In fact, these questions are best for small sales where the client makes the decision during the call. For complex sales, you need to deepen the client’s understanding of the problem they are facing.

Implication Questions Implication questions make clients see what they may not have seen. Implication questions are basically if/then questions whose purpose is to explore the consequences or impact of the problem. They make customers extremely uncomfortable because the questions and answers are a direct reflection on how the company is managed. They can also make clients feel negative and depressed.   

If you continue with ____, how will that affect your output? If you continue doing _____, will it increase your costs? If you continue using _________, how will it affect your employee turnover?

When you use implication questions, the client will often begin talking about how bad the problem could become. This can cause the client a lot of distress. Don’t leave him or her feeling miserable. Offer them a way out. Come to the rescue with a need-payoff question.

Need-payoff Questions Need-payoff questions focus the customer’s attention on the solution. A need-payoff question has two parts—one for you and one for the client. First, you ask them a question which pushes them into an ideal world. In this ideal world they begin to visualize their problem solved. Here are some examples:  Would a faster machine increase your productivity?  Would eliminating waste save you money?  Would improving the process help you meet deadlines? Notice that each of these begins with “would” a conditional statement based on the change you are suggesting they make.

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Second, you get them to tell you about the solution.  Is it important to solve this problem?  Why would our solution be useful to you?  Are there any other ways we could help you? Benefits of Need-Payoff Questions Need-payoff questions make you the client’s problem solver. Asking need-payoff questions build the value of the solution. It gets the customer talking about the solution by focusing their attention. They get the customer to uncover their explicit need: they must get this problem solved. Most customers find need-payoff questions positive and constructive. When the customer understands the value of your solution because they can articulate the benefits, they will begin to attribute solution to themselves. They sell themselves to the idea of your product by validating their need. They will tell you what is important about the sale and in turn sell others. Need-payoff questions are important for large sales that may take multiple calls to close or where large numbers of people are involved. Your client then begins to sell others within his or her organization. As someone within the company is selling, your solution gains more credibility with those who have not had a chance to meet with you. Needs payoff questions also help in the small sale. Not only do need-payoff questions create a customer who is both positive and happy, it creates fewer objections when you close. When you close, the explicit needs the client has articulated in answering the need-payoff question can help you. Explicit needs are intertwined with the benefits of your solution. Therefore they help reduce objections when you close. Dangers of Need-Payoff Questions Be aware that using need-payoff questions incorrectly can create disaster. If you use them too early in the call, you’ll make your client defensive. If you use them when you really don’t have a solution, you’ll make your client angry and lose credibility. Never use a needpayoff question if you can’t meet their need.

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How to Work the SPIN Questions Together The schematic below illustrates how you can link the four types of question together. When you link the questions together, the client will follow your thinking and reveal both his or her implied and explicit needs. The client’s explicit needs will give you the grounds for your presentation.

You establish the context

Situation Questions

Within the context, you begin asking

Problem Questions

So the buyer reveals

You elaborate implied needs into

Implication Questions

Buyer feels the problem more clearly & acutely

You alleviate the buyer’s pain with

Need-Payoff Questions

Buyer states

Explicit Needs

With permission, you may now

Benefits

Buyer agrees to solution

Sales Success!

Implied Needs

Theory Underlining the SPIN Questioning Technique The best approach to selling keys on finding out what problems the prospect is having and then linking those problems to effects or implications. From the effects or implications or ‘hurts’ the salesperson helps the prospect articulate his or her specific needs.

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You must help the client make those needs as specific as possible. For example the following query lacks specificity: “So you need a way to speed up processing in your office; Right?” A more specific query might be as follows: “It sounds as though you seek a way to multi-task so that your office staff can handle clients and prepare orders while they copy or fax. Am I on the right track?” The more specific and rich the need, the more you can tie that need to the advantages your product or service offers, unless your product will not satisfy the need. Understanding needs allows us to offer solutions. Rackham’s SPIN Selling comprises four types of questions linked together. We use situation questions to gain a general appreciation for the prospect’s operation. Problem questions reveal aspects of the operation that need improvement or parts of a process that are impairing a business. Implication questions tap the aggravation and seriousness of a problem a customer faces. Implication questions help us gauge pain or fear. Need-payoff questions set up contingencies. Good sales people try to get to the problem questions as quickly as possible. Then they work the implications to help the buyer determine the biggest problem that needs to be addressed. Finally they present need-payoff questions which form the basis of the presentation. The better you are at working problem questions, deriving implications with the buyer, and framing need-payoff questions, the easier you will find it to sell. In sales, it is really unimportant how much detail you know about the product relative to how well you identify the real needs the buyer has. So, learn to identify those explicit needs quickly. Questioning a prospect allows you to determine what considerations guide their decision making. That is, you seek to determine what type of problems they face and how serious each problem may be in their situation. By using the information you uncover about problems and the importance of each problem, you derive needs. Read through the following sequence, noting the tenor of each question. Look at how the questions build one on the other. “So Ms. Jones, you believe that lacking a high-speed data line means you spend an additional three hours each week downloading data files?” [problem—implication]. “What would you be able to do with an additional three hours of work time each week?” [implication—need]. “So saving time is very important to your company” [implication-basic need]. “So you need an economical way to download data files so that you save at least three hours each week?”[need-payoff]. “If I can show you a way to save three hours each week and download files twice as quickly as you presently do, would you be willing to hear about it?”[transition from need-payoff to solution]. 5

SPIN Selling

Isolating Needs Here you have determined that saving time is a key need for Ms. Jones. You also determined that one of the chief tasks Ms. Jones faces is downloading data. You linked saving time to your product, a high speed data line. That, more or less, is the logic for identifying one need. Your will want to use such guided questioning with your prospect in the selling solution exercise. These are the steps for turning something into a need. First, all is great. Then discontent arises. This discontent becomes a problem (implied need). With the salesperson’s helps, the implied need is focused on until the client says “There must be a better way!” The skill in questioning is building a line of thought that is driven by a problem the business person faces. Stay with the line of thought until you have crystallized a need. Once you have identified a need, put it on the shelf and go on to locate another problem. It is possible that your client has three, four, even five problems. Your challenge is to locate the problems and determine which of the problems are base or critical. Let’s look at the following example. “My office is too hot” is certainly a problem. “It is so hot in the copy room that one lady almost passed out”. “I am afraid that unless we can get the temperature down in here, someone may sue me” [implication]. “So you need a system that operates at a low enough temperature for you to be sure that nobody will be endangered while working in the copy room?” [need-payoff question]. The first problem, overheating of the copy room, is annoying. However, the second problem is critical from a business perspective. The second problem relates to money and time assets of the business person. Your job is to isolate the problems and through implication questions determine what the order of importance of the problems is. That task is called Needs Analysis. Okay. Here is another example for the same account. “I have to have color brochures to use in my travel seminars.” “Right now I make the brochures at Joe’s Copy Shop. That costs $0.25 per page. “Last month I spent $1,000 on travel brochures—plus I had to go over and pick them up.” [problem]. “So you are concerned about spending $1,000 per month on color copies and having to go over and pick them up as well?” [implication]. “It sounds as though you need a way to do color copies conveniently and less expensively in terms of money and time. Am I correct on that?” [need payoff]. “It sounds as though if I could share a way to do color copies for much less per page and do them in house, you would be interested in hearing about it. Are you interested in hearing about doing color copies in house?” [need-payoff, transition to sale]. 6...