Management Models: SPIN Selling
One of the key principles of selling is that people only buy when they have a problem. All the time the laptop computer is working, the owner has no problem and no need to replace it. Only when it goes down and threatens to ruin their business communications do they want a service that will give them peace of mind. It is this obvious but under-appreciated principle that underlies a management model known by the acronym, SPIN. This model was first developed by Neil Rackham of the Huthwaite Organisation in his best-selling book of 1978, "SPIN Selling". The book records how Rackham and his team analysed more than 35,000 sales calls. From their studies they were able to put to rest some of the myths about selling and develop the steps that would lead to successful sales.
SPIN Selling: the 4 Steps
Shortly after publishing his survey results, Neil Rackham trained a group of sales professionals in the SPIN selling model. The result was a 17% increase in their sales. These are the 4 steps in the SPIN selling model that they used:
1. Situation Questions that ask about the buyer's current situation with a view to identifying the problem that the current situation has given rise to, eg "what happened when your laptop broke down?"
2. Problem Questions that ask about the buyer's pain and focus the buyer on this pain while clarifying the problem, eg "It must have been difficult trying to keep in touch with your customers when you had no email connection?".
3. Implication Questions that ask about the effects of the problem, eg "What would be the worst scenario if you had no Internet connection for a week or more?"
4. Need-Payoff Questions that ask the buyer to tell you about their explicit needs and the benefits your solutions offers, eg "So what you really need is some kind of 24/7 service that can provide you with an instant backup if the same thing happens again?"
These questions take the buyer through the steps of identifying their problem, their pain, and a solution that your product or service offers.
SPIN Selling: Key Principles
The chief principle underlying the SPIN selling model is that people don't buy from salespeople because they understand their products but because buyers feel that salespeople understand their problems. Here are some of the other key principles of the SPIN selling approach:
1. you must build rapport with your buyer before they will buy. Rapport eases the tension that buyers have about finding a solution to their problem.
2. don't manipulate the buyer by finding common areas of similarity between you. Instead, look for unconscious rapport such as matching speed and tone of speech.
3. don't ask too many Situation questions that the buyer feels uncomfortable with. Instead, do your homework on your buyer's situation first.
4. spend most of your time asking Problem questions rather than Situation questions on the basis that people buy when the pain of their problem is greater than the cost of the solution.
5. know in advance how your product or service solves problems.
6. uncover several problems before asking Implication questions as focusing on just one problem invites your buyer to raise issues where your solution doesn't do too well.
7. aim to get buyers to articulate the benefits in your product or service rather than have you spell them out.
8. work out the action steps that the buyer needs to take to complete the sale and get commitment to one of these steps on each occasion that you talk.
9. understand that a questioning mindset is more important than the ability to persuade.