4-Types of Contacts
The first important skill you need to develop as a founder and salesperson is to:
- Find people who are interested in buying your product, and
- To filter out people who are not interested or who are not suitable for your product.
In this search for prospects, contacts who are potentially interested in your product or service, you will come across four different categories. According to Jordan Belfort, these four categories are:
- Ready to Buy: On average, out of 100 contacts, 20 are your potential customers, meaning they are people who know they need a solution or product like the one you offer and that they need to make a buying decision soon.
- Shopping: 30 out of 100 contacts are still shopping – they are looking around. In the foreseeable future, however, these prospects will definitely buy a product or service. When that will happen, we don’t know; maybe in 12 weeks or not for 6 months.
- Prospects: Another 30 contacts are interested in your product or service, but don’t need or want to buy it at all. They can cost you a lot of time and effort in sales, as they seem interested but are very unlikely to buy a product at all.
- Non-buyers: The remaining 20 contacts have somehow slipped into your prospect list, even though they don’t belong there. These are people who will never buy your product or service. Either because they don’t need it at all, don’t have the money for it, or just aren’t interested.
As we can see, half of our contacts are a waste of time and effort.
The first important skill of us as sellers and founders is to weed out these time and energy vampires.
Contacts and Decision Makers
If we transfer this concept from people to companies, we can also categorize companies into these four categories.
There are companies that need your product today and are ready to buy it. Likewise, there are companies that are still shopping, i.e., looking around on the market.
In each company, you have to find the one contact who explicitly deals with your topic, who is looking for your product and who can actually decide on this topic.
If you sell your product or service to a large company, you will have to find the correct department and, among hundreds, thousands, or even tens of thousands of employees, you will have to find the ONE individual who understands your product, who needs it, and who can decide to buy it.
We call these people the decision maker.
If you sell your product or service to smaller companies, i.e., companies with less than 50 employees, your contact person will usually be the CEO.
For a successful cold call, it is absolutely crucial to approach the decision maker.
In large companies, you will find 20 people, all of whom could be suitable contacts for you. But among these 20 people, there are 19 people who do not understand or need your product and therefore fall into the category of “non-buyers”. One person out of these 20 potential contacts is aware of the problem you are solving with your product. This person is willing to do anything to solve this problem. This person is “ready to buy” and he is your decision maker, whom you have to locate!
If you are talking to the wrong person, this person may tell you: “Ah, this could be interesting for my colleague.”.
From my experience: Never allow a person to act as a middleman for you. This is nonsense and will get you nowhere. Only talk to the actual decision maker, not to an employee who passes on your contact details, information material, etc. to another employee.
The difference between a decision maker and a normal employee:
- The decision maker is interested in the big picture: If your product or service helps to move his project or company forward, he wants it.
- Price plays a smaller role than it does for a normal purchaser or project employee in the company, as long as the product adds significant value to the company.
- Your sales cycle is shorter because you start where the buying decision would have been made later anyway.
Decision makers are mainly interested in the benefits for the company or the project, hardly in features or the detailed functionality. Focus on the concrete added value for the company and on how the decision-maker will benefit from it personally (bonus payment, promotion, etc.).
Finding Leads
Before you can search and approach a decision maker, you need a list of companies to which you can sell your products or service.
You probably already have a few companies in mind that you would like to attract as dream customers. To find more companies, you can use the following tools:
- Trade show catalogs and exhibitor directories of relevant trade shows
- Member lists of associations and federations
- Online portals of business newspapers, magazines
- Databases
- Commercial address data providers
Finding the Decision Maker
But how do you find the right decision maker in a company? Depending on the product or service you are selling, your decision-maker could be the company’s CEO, or a VP of Marketing, Sales Manager, Product Manager, etc.
You can research this decision maker in advance, for example via the company’s website, via LinkedIn or via a short Google search.
Finding Decision Makers with LinkedIn
LinkedIn is perfect for finding the right contact person in a company.
There are free ways to search people as well as paid premium memberships, which make this process even more efficient.
Company Profiles
Particularly for smaller companies with fewer than 100 employees, it is usually possible to find the appropriate contact person within a few minutes using the company’s LinkedIn profile.
Everyone who uses LinkedIn will certainly have visited such a company profile at some point. Here you can see, among other things, which employees work for the company as well as the company’s most recent postings.
Employees can also be searched by title or keyword. By working through or searching the list of employees on the company page, you will quickly find the best possible contact.
Of course, on LinkedIn, we can only find the company’s employees who are also registered on LinkedIn.
With larger companies, on the other hand, it becomes a bit more complicated. Here, it can be helpful to take a closer look at some of the company’s recent posts. Sometimes specific employees of the company comment or react to certain topics. In this way, you can draw conclusions about who is working on which project or topic.
LinkedIn Search
The LinkedIn search is simpler and much more efficient. For free LinkedIn members, however, the search functions are very limited to a few search hits and a few search queries per month.
For those who are serious, LinkedIn offers a paid membership called “Sales Navigator,” which is priced at around $80 to $90 per month.
Someone who is actively involved in sales, LinkedIn is a really valuable tool, so the seemingly high price really pays for itself quickly, just measured by the time you save looking for decision makers.
With the Sales Navigator you can use very extensive filter functions, with which you can find targeted decision makers and contacts of specific companies or entire industries.
In the current phase, we do not use LinkedIn to contact the contact person via LinkedIn or to add them to our contacts, but only to find out the name and the position of the right contact person.
We save the name as well as the position of the right or the best possible contact person as a lead in our CRM system.
Side note: Speaking of CRM system. With a CRM system, you maintain and manage your leads, all your contacts, your sales pipeline, follow-up reminders and much more. I recommend every salesperson use a CRM system and maintain it. I use Pipedrive. Besides Pipedrive, I can also recommend Close.com.
Search via Google
For those who may not want to sign up for a LinkedIn membership directly, you can also use Google to find contacts on LinkedIn.
In fact, I believe that Google sometimes provides the better results than LinkedIn itself.
To quickly find the LinkedIn profile and thus the name and position of the decision maker, simply search on Google for, for example, “product manager topic company LinkedIn.”
Independently of LinkedIn, you can of course simply Google for a contact person, for example, quite simply with “purchasing manager, company”.
Larger companies also often publish press releases in which you can also find the names of the responsible individuals (e.g., the head of a specific project) as well as his or her contact information, such as the person’s e-mail address and phone number. For this purpose, you can easily Google “project manager, company, press release”.
In Case of Doubt, Call the Boss
If you are selling to smaller companies with fewer than 50 employees, the CEO of the company is generally the right person you should contact because in most cases he or she will make the final purchase decision.
But even with large companies, you should always turn to the highest manager as your contact when in doubt. Depending on the product and service you are selling, as well as the size of the company, this can be the CEO of the entire company, or the VP of Purchasing, head of a department etc.
You should always delegate as high as possible. You can always be delegated down. Likewise, you rarely get delegated to the top.
Reaching C-Level Decision Makers
While we’re on the subject. Reaching decision makers at the highest executive level – the C-level – can be a real challenge at larger companies.
In my experience, it works well to start cold calling very early, often as early as 07:00 or even 06:00 in the morning. The general managers are regularly in the building before the employees, and thus can be reached surprisingly early.
Likewise, the chances of success are high in the evenings after 6 p.m. and especially on Friday afternoons from 4 p.m. or 5 p.m., when the secretary already left and the manager has time to answer e-mails and take calls.
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