SPIN Selling
by Neil Rackham
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Book Reviews of SPIN Selling
Book Review: Never Gets Old. Brilliant.
Summary: 5 Stars
This is a classic sales book going back about 20 years. In that time, customers really haven't changed, people still think of Sales as a bipolar relationship whereby you're meant to be `friendly' whilst taking advantage of the customer. Whether it's a product to a business (eg. HP high-end servers) or to a consumer (eg. Kobe's latest basketball shoes), or it's actually a service (like a travel agent, or an airline), the mindset should be the same: offer tremendous value, and make sure the price comes well below that value.
Okay, before I get too deep in the marketing speak. Here Value is `all the ways you can make the customers life easier/better by using your product.' This is awesome if you can put a dollar value amount on it.
So that's it, and the salesman's job is to rattle off enough features that turn into (in the customer's mind) `value', right? Nope. Actually the popular approach of just listing features (or reading them to the customer!) doesn't really work. It's like you're speaking Swedish, and you're expecting your prospect to be able to do the translation himself. He doesn't want to, he wants to talk to someone who will do the translation for him--either you or.. one of your competitors.
It turns out that features are only really interesting on very simple, low-end products. Cheap products or commodities rely on features to differentiate themselves (or, shall we say, de-commoditize themselves?). Do you want the red pen or the blue one? Should it be re-fillable? Does it have a comfortable rubberized grip? Ok. Done. These are decisions that you can make in a few seconds, and don't need to consult anyone over.
But if you have any success at all in sales, you'll want to move on to bigger and better products, where the commissions are nice and fat. If you bring that `feature' based approach with you, you won't last. All `listing features' does is increase your customer's expectation of a higher and higher price, getting you away from the value-based approach. Turn the attention to the customer.
Rackham breaks down the research and the new method of Spin selling. Yes, you have to do a little research before sitting down with each customer, but it's worth it. Link the questions to value, get the customer to think about what might go wrong, and how much the solution is worth to them. Sales skills are important in every job. Persuasion is important to everybody. Value is important to everybody. This isn't really about money, it's about listening to people. Your task, whether you're selling a car, or persuading your friends to go to a particular nightclub is not to shoot down alternatives (competition, other nightclubs) but to ask the questions that will elicit values. You get people to declare their needs clearly, and then offer them the solution (eg. your product).
This isn't about tricking people into buying bad products. This isn't a fight, and it's not something to be nervous about. It's not about hypnosis, and it's something you should be ashamed of. Your job is not even about money, it's about communication. What you really want to do is analyse the customers situation and find multiple ways your product can benefit them. After having done that, hopefully the value is much higher than the ticket price. If it is, you shouldn't have trouble closing the sale.
Not only do you sell the product, you sell yourself in this way when you're looking for a raise, or applying for a new job. This is the core of decision making, and what value means to people. Showing others the tremendous value that is already right there in front of them.
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Book Review: A classic and one of the very best
Summary: 5 Stars
SPIN is a classic, one of the books that revolutionized professional selling. It amazes me to read some of the negative reviews of this book posted here. Some of this I attribute to lack of knowledge of the history of our "profession," which bears few hallmarks of being a profession yet. Can you get a four year college degree in SELLING, the one thing every business must do well to survive, let alone prosper? Except for programs at a small handful of universities around the country, the answer is NO. Do we have peer-reviewed journals in our profession? NO. Do we have accepted standards and professional certification? NO.
What Neil Rackham, a behavioral researcher, did for selling was huge. He applied the techniques of research and analysis to our profession. Until then, no one could say definitively that "always be closing" was bad advice. But in business to business selling, in high-tech selling to educated professionals, the "ABC's of selling" is only one of many pieces of bad information that passed for "wisdom" before Rackham showed them up for what they were. Such sales tactics are the reason salespeople have been saddled with negative stereotypes.
Some reviewers condemn Rackham by saying that companies cited, such as Kodak, IBM, and Xerox have suffered business reversals since this book came out. Sorry folks, but good salespeople using good selling techniques will not, alone, save your company. MANY companies that were at the top of their industries in the 1970s and 1980s are either out of business or have suffered serious reversals in the years since. That is a different issue altogether, and if you are looking for explanations try STRATEGY books like "Good to Great" by Jim Collins or "Strategy" by Michael Porter. Someone on this site said that IBM's loss of computer business to other PC makers was evidence of the failure of SPIN...totally ridiculous. IBM passed on the operating system that became DOS, which in turn became the engine fueling MicroSoft's ascent to the heights. In hardware manufacturing IBM ignored lots of evidence that a paradigm shift was underway and PCs were becoming commodity items.
The negative reviewers are looking for a silver bullet in many cases: SPIN will not transform you into a president's club winner by reading it. It is how you apply and practice it that will enable your success. Becoming expert in the use of this simple framework requires work and thought. What Rackham showed us is that the WORDS we use are important, along with HOW WE USE THEM. We must understand THEIR goals and focus on being part of THEIR success if we are to be successful in a sustainable, long-term partnership. Also that we must not be manipulative or treat other people (aka "customers" or "prospects") in ways we would not want to be treated ourselves. The acronym "SPIN" was coined before Washington politicians gave the word the negatie connotation it now has.
SPIN is not the only good refenence book for salespeople, but it is a landmark book, the result of research that has not, to my knowlege, been replicated since. It should be a held in great esteem by any sales professional. Rackham's concept of an "Advance" as an objective way to measure the progress of a sales call is, alone, worth the price of this book.
By the way, I have been in sales for 30 years, as a salesperson, sales manager, and director of training for a Fortune 500 company. I still have a lot to learn. But one thing I do know: there is tremendous value in this book for any salesperson with an open mind and the desire to continue growing, learning and improving as a sales professional.
Book Review: A Business "Classic" Revisited
Summary: 5 Stars
I read this book when it was first published (in 1988) and havesince re-read it several times. What is to me remarkable is that it"holds up" so well over time. Obviously, as the reprintingsindicate, it has been immensely helpful to salespersons as well as to those who train them and to those who supervise them. With the recent and accelerated development of online merchandising, however, I wondered, "Has the SPIN System lost any relevance?" So I re-read the book again. My answer is "Yes" and "No."
"Yes" in that online merchandising relies so heavily (almost exclusively) on technology to provide information and then to process orders. By the time most prospective buyers visit a website, they have already examined their situation (S), identified a problem (P), considered the implications of that problem (I), and determined the desired need-payoff (N). However, the core principles of SPIN Selling are nonetheless invaluable to those who design the systems by which to expedite online merchandising. For example, the principles can assist with the formulation of feedback mechanisms which enable the prospective buyer to sharpen the focus on her or his specific Situation, Problem, Implication, and Need-payoff. The reality is that "customized" commodities are still commodities, of course, but a buyer's perception of them may be otherwise.
But "No" in that so many so-called "Big Ticket" purchases necessarily involve a salesperson. Moreover, there is usually a direct correlation between the amount of the purchase and the length of the sales cycle. In addition, many of these purchases also involve a "circle of influence" which complicates the situation even more. Use of the SPIN System, therefore, must be sufficiently flexible to accommodate a sometimes wide variety of different (perhaps contradictory) perspectives on the given Situation, Problem, Implication, and Need-payoff. My own rather extensive experience suggests that it is and it does.
The latest re-reading also suggested to me, in ways and to an extent previous readings hadn't, that the principles of SPIN Selling (with only minor modifications) can be effectively applied to situations in which nothing is for sale. For example, during the hiring process, when a promotion is being negotiated, or after a major crisis has occurred and must be resolved. Yes, yes, I know. There are excellent reasons why Rackham's book bears the title it does. The title is certainly appropriate. All I presume to suggest is that, for me at least, the principles of SPIN Selling have applications wholly unrelated to the selling process...unless we extend the meaning of "selling" to include persuasion in almost any context.
This is a business "classic." Like all other such classics, it deserves to be re-read periodically, both to remind us of what we may have forgotten and to reveal to us what we may have failed to understand before. Within a turbulent global marketplace, moreover, the principles of SPIN Selling have achieved a matrix of relevancies which perhaps even Rackham could not have anticipated in 1988.
Book Review: Highly effective technique in high-touch Sales
Summary: 4 Stars
This book is a simple guide to improve your effectiveness as a sales professional in high-value direct enterprise sales situations. Regardless of culture and language, people on the other side of the table from a sales person have an instinctive judgment to mis-trust any characteristic that seems contrived or unnatural. Genuineness is a pre-requisite. Therefore, like with any sales theory, rote learning and implementation of the theory is futile. Having said that, internalizing the fundamental premise of this book in my everyday life as a sales-person has been rewarding over the years and across geographies, cultures, languages and types of product/service being sold.
SPIN selling goes well with approaches that talk about Values-Based Selling, Solution Selling and Rackham's own Major Account Sales Strategy.
Huthwaite (Rackham) has done a phenomenal job of monetizing this simple concept by way of selling sales training and books. However, you may find the book too "salesy" at times. It is common idiom with any good speech, presentation or book; first you tell them what you are going to tell them, then you tell them, then you tell them what you told them. The book does a great job of steps 1 and 3, but leaves you wanting more in step 2.
The basic concepts about stages of a sales call, focus on customer needs and benefits, situation-problem-implication-need-payoff line of questioning, objection handling/prevention, sound closing techniques and post-sales are well articulated. The promise of increasing effectiveness in "major sales" is largely fulfilled. However, the emphasis on "it's based on research" goes unsubstantiated for the most part. You find the author insisting that "it's based on research" and providing simplistic graphs "based on research" than actually providing rigorous insights into the research. It also does not help that business theory is presented as a first person narrative. Blurs that fine line between theory-based opinion and opinion-based theory.
All said, the technique is highly effective and serves as a great foundation for approaching sales calls at various stages in the cycle. I've found myself going back to this book multiple times over the years. Always a good sign for books that you want to own rather than just read once.
Book Review: A convincing Model on how to handle the Mjor-Account Sale
Summary: 5 Stars
Neil Rackham writes a book that summarizes the ground-shaking discoveries of his Company, Huthwaite. The Whole purpose of their research which lasted for a good Number of years was to discover what certain behaviors on the salesman's part helped In creating a successful purchase in the Major-Account sale, in which the item for Sale was usually expensive and requires a long after-sales relationship between buyer And seller.Mr. Rackham turns the conventional sales knowledge upside-down and he does so very convincingly. He divides the sale into 4 phases; The Preliminaries, Investigating, Demonstrating Capability and Obtaining Commitment. He lays great emphasis in The Investigation phase, and it is in this phase that the SPIN Model comes into action.
SPIN is an acronym for the different types of questions that a seller must use in order to properly establish the last two phases of the sales call. Situation questions are simple straightforward questions about the buyer's company and current situation they are general questions that basically aim to establish context for the next questions. Problem questions are those which aim to pinpoint the exact problems of the buyer so that it becomes easier to uncover his implied needs. Implication questions take us a step further into examining the consequences of the buyers problem more closely and trying to make him more acutely aware of their ramifications so that we can start asking Need-Payoff questions which basically deal with the value and utility that the buyer perceives in a solution. The Need-Payoff questions lead to the development of Explicit need in which the buyer Has been led to clearly understand the context of his exact need to fix a particular Problem. Only after the SPIN questions have been successfully used to define Those explicit needs can a seller start demonstrating capability. With knowledge Of the needs of the buyer the seller can therefore more easily demonstrate solutions Which satisfy those explicit needs, i.e. the benefits of the product or service.
Mr. Rackham describes the different phase in the different chapters of his book and provides very useful information to discredit many misconceptions that have long Been held holy by salesmen, such as the importance of closing, the true meaning of Benefit as opposed to advantage and feature, the relative value of openings and first Impressions and most of all the value of the investigating phase.
An Essential book if you have anything to do with Sales.