{"id":919,"date":"2020-03-15T00:42:30","date_gmt":"2020-03-15T00:42:30","guid":{"rendered":"https:\/\/sellingsherpa.com\/?p=919"},"modified":"2020-03-15T03:10:32","modified_gmt":"2020-03-15T03:10:32","slug":"the-expansion-sales-book-summary","status":"publish","type":"post","link":"https:\/\/sellingsherpa.com\/index.php\/2020\/03\/15\/the-expansion-sales-book-summary\/","title":{"rendered":"The Expansion Sales (Book Summary)"},"content":{"rendered":"
\n

The\nExpansion Sale<\/a> by Erik Peterson and Tim Riesterer<\/p>\n\n\n\n

Foreword<\/strong><\/h3>\n\n\n\n
  • In a competitive market, renewals are really\nresells.<\/li><\/ul>\n\n\n\n

    Introduction<\/strong><\/h3>\n\n\n\n
    • The Context Effect calls for you to develop and deliver a message differently to prospects versus existing customers.<\/li>
    • Four must-win commercial moments in every customer relationship:
      1. Renewals<\/li>
      2. Price increases<\/li>
      3. Upsells<\/li>
      4. Apologies<\/li><\/ol><\/li><\/ul>\n\n\n\n

        PART I DEVELOPING THE EXPANSION MESSAGE<\/strong><\/h3>\n\n\n\n

        Chapter 1<\/strong>\nAcquisition Does Not Equal Expansion<\/strong><\/h3>\n\n\n\n
        • If you\u2019re trying to unseat a competitor, you\nneed to first take the step of framing the act of sticking with the competitor\nas a loss for the executive, before framing the gains that you can bring.<\/li><\/ul>\n\n\n\n

          Chapter 2 Expansion Messaging Mission Critical, but\nMissing in Action<\/strong><\/h3>\n\n\n\n
          • According to a Corporate Visions survey of more\nthan 400 B2B organizations, 80 percent of companies spend more than 70 percent\nof their sales and marketing budget on demand generation messaging, content\nmarketing, and sales enablement and management for new customer acquisition.\nRetention and expansion programming fight it out for the other 30 percent.<\/li><\/ul>\n\n\n\n

            Chapter 3<\/strong>\nWhy Stay and the Psychology Behind Renewals<\/strong><\/h3>\n\n\n\n
            • When you\u2019re the status quo, the biggest risk of using a disruptive message is that it will work! Instead, document success and reinforce the status quo.<\/li>
            • The \u201cWhy Stay\u201d narrative:
              1. Document results (reinforce Preference Stability). You\u2019ve made great progress on your goals over these last two years. You\u2019ve seen 401k participation grow from 20 percent to 50 percent. Your employee satisfaction scores are up, and your employee retention rates have started to improve, which was the ultimate goal of making these changes.<\/em><\/li>
              2. Review the prior decision process (reinforce Preference Stability). When you signed up two years ago, you really did your homework and looked at a lot of options before getting your entire team to come to a consensus and choose our company.<\/em><\/li>
              3. Mention the risk of change (reinforce Anticipated Regret and Blame). As you look at making a renewal decision, it\u2019s important to realize that you are at a critical point in this journey and that it\u2019s important to maintain momentum to achieve your ultimate participation and retention goals. Any change in the program at this point could create an unnecessary risk of losing the positive gains you\u2019ve made.<\/em><\/li>
              4. Highlight the cost of change (reinforce Perceived Cost of Change). Bringing in another vendor would require you to invest both time in getting the vendor up to speed and money on implementation costs and other changes that you won\u2019t have to spend if you continue working with us.<\/em><\/li>
              5. Detail competitive advances (reinforce Selection Difficulty). We\u2019ve continued to update your program over the last two years to ensure you\u2019re keeping pace with anything else available in the market today. You\u2019ll get two new features to help improve your goals of employee participation and satisfaction.<\/em><\/li><\/ol><\/li><\/ul>\n\n\n\n

                Chapter 4<\/strong>\nCracking the Code on the Price Increase Conversation<\/strong><\/h3>\n\n\n\n
                • Bain & Company noted that pricing has a more\nprofound business impact than gaining market share or reducing costs.<\/li><\/ul>\n\n\n\n

                  Chapter 5<\/strong>\nWhy Pay More A Framework for Improving Your Price Increase Conversations<\/strong><\/h3>\n\n\n\n
                  • Why Change messaging loses big in a renewal scenario \u2014 finishing dead last in favorable attitude<\/li>
                  • Introducing an Unconsidered Need had a detrimental effect on the renewal message<\/li>
                  • The winning price increase message appears to embody two things:
                    1. First, it reinforces the status quo while introducing competitive advances that align with the customer\u2019s business goals. <\/li>
                    2. Second, it anchors high with the new price before giving the justified discount to secure the renewal.<\/li><\/ol><\/li>
                    3. The \u201cWhy Pay More\u201d narrative:
                      1. Document results. You have made great progress on your goals over these last two years.<\/em><\/li>
                      2. Review the prior decision process. When you signed up two years ago, you really did your homework and looked at a lot of options before getting your entire team to come to a consensus and choose our company.<\/em><\/li>
                      3. Mention the risk of change. As you look at making a renewal decision, it\u2019s important to realize that you are at a critical point in this journey and that it\u2019s important to maintain momentum to achieve your ultimate participation and retention goals.<\/em><\/li>
                      4. Highlight the cost of change. Not to mention that bringing in another vendor would require you to invest both time in getting the vendor up to speed and money on implementation costs and other changes that you won\u2019t have to spend if you continue working with us.<\/em><\/li>
                      5. Detail competitive advances. Over the last two years we\u2019ve been developing new capabilities to drive more satisfied participants, as well as give you confidence that your program is keeping pace with anything else available in the market today.<\/em><\/li>
                      6. Anchor the price increase high and introduce \u201cjustified\u201d discount. These new services and functionality will add approximately 8 percent to the annual cost of your plan. However, if you renew before the end of the month, we will reduce the price increase by 50 percent, making it just a 4 percent overall increase to get this level of service.<\/em><\/li><\/ol><\/li><\/ul>\n\n\n\n

                        Chapter 6<\/strong>\nMessaging for the Upsell The Why Evolve Conversation<\/strong><\/h3>\n\n\n\n
                        • If you aren\u2019t supporting your customers with continual, remarkable experiences and relevant solutions, they\u2019re all the more vulnerable to your competitors \u2019 disruptive messages.<\/li>
                        • A successful upsell message needs to answer each of the following five questions:
                          1. Is it different enough?<\/li>
                          2. Is it important to their success?<\/li>
                          3. Is it personally convincing?<\/li>
                          4. Does it incite change?<\/li>
                          5. Does it drive purchase intent?<\/li><\/ol><\/li>
                          6. You have to walk a delicate line between reinforcing the status quo and introducing just enough disruption to incite change.<\/li><\/ul>\n\n\n\n

                            Chapter 7<\/strong>\nThe Winning Why Evolve Message Framework<\/strong><\/h3>\n\n\n\n
                            • Relationship Reinforcement and Emotion. This \u201chybrid\u201d of Why Change and Why Stay uses strong emotional language to emphasize the partnership between the customer and the vendor, while at the same time initiating a frank conversation about shared challenges and opportunities.<\/li>
                            • Experienced marketers and sellers have long known that buyers hate straight product pitches, and they should know better than to deliver them. Yet for some reason, when it comes to positioning upgrades, all that wisdom goes right out the window \u2014 they are perfectly comfortable positioning the new capabilities as the main reason the customer should make the change.<\/li>
                            • The \u201cWhy Evolve\u201d narrative:
                              1. Document results. Over our nine-year partnership, we have worked together toward your goals of creating organizational efficiency, increasing customer satisfaction, and protecting and growing revenue.<\/em><\/li>
                              2. Highlight evolving pressures. As with anything else, business needs change and technologies evolve. Externally you face a customer base that wants personalized solutions and instant answers. Internally you have a changing workforce that wants the newest tools and greater work flexibility.<\/em><\/li>
                              3. Share \u201chard truths.\u201d As partners, it\u2019s tempting just to focus on all the positives, but the role of a good partner is to also share hard truths. The fact is, we\u2019ve heard from your teams that they like our software, but they are frustrated at having to dedicate time consolidating data from different sources. Then once the data is consolidated in your system, they feel limited because your current version has a limited set of standard reporting views available.<\/em><\/li>
                              4. Emphasize risk of no change. These areas of inefficiency can make it difficult for your hardworking teams to identify areas of waste, which means the organization continues to waste time.<\/em><\/li>
                              5. Describe upside opportunity. But you can ensure your team has the latest version of the software that is so critical to your business. By upgrading to our new cloud-based solution, you\u2019ll get faster, simpler, and more flexible business management capabilities that allow you to acquire and analyze multiple data sources easily from a single app.<\/em><\/li><\/ol><\/li>
                              6. In good messaging, you can\u2019t just tell people what they shouldn\u2019t do; you also need to give them a strategy for what they should do.<\/li><\/ul>\n\n\n\n

                                Chapter 8<\/strong>\nSorry \u201dShouldn\u2019t Be the Hardest Word Apology Science and the Expansion\nSale<\/strong><\/h3>\n\n\n\n
                                • The Service Recovery Paradox is a situation in which customers think more highly of you after you\u2019ve corrected a problem than if they\u2019d never had the problem to begin with.<\/li>
                                • Four key components necessary to trigger the SRP in this setting
                                  1. Initiation. Willingness to engage in recovery actions, even if the problem wasn\u2019t caused directly by that provider, but rather by a subcontractor or other third party.<\/li>
                                  2. Response speed.<\/li>
                                  3. Compensation. Allocation of physical and financial resources.<\/li>
                                  4. Apology. Expression of remorse that conveys politeness, courtesy, and concern for the client.<\/li><\/ol><\/li>
                                  5. five specific steps a provider needs to take to apologize effectively:
                                    1. Acknowledgment of Responsibility.<\/li>
                                    2. Offer of Repair.<\/li>
                                    3. Explanation of the Problem. Explain the reasons for the failure.<\/li>
                                    4. Expression of Regret.<\/li>
                                    5. Declaration of Repentance. Promise to not repeat the problem.<\/li><\/ol><\/li><\/ul>\n\n\n\n

                                      Chapter 9<\/strong>\nThe Winning Why Forgive Message Framework<\/strong><\/h3>\n\n\n\n
                                      • The emotionless, just-the-facts apology consistently landed at or near the bottom.<\/li>
                                      • Most people are told to say something like, \u201cHere\u2019s what happened, here\u2019s what we\u2019re doing to fix it, we\u2019re very sorry this happened, it won\u2019t happen again, and here\u2019s what we\u2019ll do to make this right.\u201d But the winning framework looked nothing like this.<\/li>
                                      • Here is the winning apology messaging condition as delivered in the test:
                                        1. Offer of Repair. I want to attempt to repair any possible problems this outage caused for you, your team, or your employees. First, I have been approved to provide\u2026<\/em><\/li>
                                        2. Acknowledgment of Responsibility. The software outage was entirely our fault. It should not have happened at all, let alone during such a critical time for your business. We take full responsibility and are committed to ensuring it will not happen again.<\/em><\/li>
                                        3. Declaration of Repentance. I fully regret that this outage occurred, and our teams are making the necessary changes to make sure it does not happen again.<\/em><\/li>
                                        4. Explanation of Problem. To let you know what occurred, your software went down after a major power outage at one of our data centers.<\/em><\/li>
                                        5. Expression of Regret. I am exceptionally sorry for this outage, and as soon as I knew about it, I was in constant communication with our technical teams until it was resolved. On behalf of our company, I would like to apologize not only to you, but your leadership team and all affected employees.<\/em><\/li><\/ol><\/li>
                                        6. Customers aren\u2019t going to care about the \u201cwhy\u201d behind your actual apology until they know how you\u2019re going to make things right.<\/li>
                                        7. Responding to an emotional situation with a rational explanation will backfire. You first need to lower the emotional temperature, and the Offer of Repair is the best way to do that.<\/li><\/ul>\n\n\n\n

                                          PART II DELIVERING THE EXPANSION MESSAGE<\/strong><\/h3>\n\n\n\n

                                          Chapter 10 he Right Message at the Right Time Mastering\nSituational Fluency<\/strong><\/h3>\n\n\n\n
                                          • Communicate results early and often.<\/li>
                                          • It\u2019s ever so tempting to get caught up in the new\nand lose sight of the commercial outcome.<\/li>
                                          • Selling the same things to the same people = Why\nStay<\/li>
                                          • Selling new things to the same people = Why Evolve\n<\/li>
                                          • Selling new things to new people = Why Change<\/li>
                                          • If your customer hasn\u2019t decided to expand with you\nby the 75 percent mark of the initial contract term, it\u2019s time to refocus efforts\nentirely on Why Stay to retain that client<\/li>
                                          • If you\u2019re waiting until that renewal date to dive\ninto all the wonderful things you\u2019ve done together, you\u2019re too late.<\/li><\/ul>\n\n\n\n

                                            Chapter 11<\/strong>\nDelivering the Message Essential Skills for the Expansion Seller<\/strong><\/h3>\n\n\n\n
                                            • One biggest challenge for expansion sellers and customer\nsuccess teams \u2014 elevating customer value back up to the most senior stakeholders\nthat signed off on the initial purchase.<\/li>
                                            • The speaker in the hand-drawn condition was perceived\nas more credible than the others, even though everyone got the exact same message\nwith the exact same audio track.<\/li><\/ul>\n\n\n\n

                                              Chapter 12<\/strong>\nNavigating the Conversation Advanced Skills for the Expansion Seller<\/strong><\/h3>\n\n\n\n

                                              (no substantive content in this chapter) <\/p>\n\n\n\n

                                              Chapter 13<\/strong>\nExpansion Messaging as a Commercial Strategy<\/strong><\/h3>\n\n\n\n
                                              • In your early QBRs, you should be telling your \u201cWhy\nStay\u201d story, which is a story of why the customer made a good choice.  But before too long, you need to shift your QBRs\nto tell a Why Evolve story. Finally, return to the \u201cWhy Stay\u201d story when\napproaching renewal.<\/li><\/ul>\n\n\n\n

                                                Chapter 14<\/strong>\nParting Thoughts<\/strong><\/h3>\n\n\n\n

                                                (no substantive content in this chapter)<\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"

                                                The Expansion Sale by Erik Peterson and Tim Riesterer Foreword In a competitive market, renewals are really resells. Introduction The Context Effect calls for you to develop and deliver a message differently to prospects versus existing customers. Four must-win commercial moments in every customer relationship: Renewals Price increases Upsells Apologies PART I DEVELOPING THE EXPANSION […]<\/p>\n","protected":false},"author":1,"featured_media":923,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_import_markdown_pro_load_document_selector":0,"_import_markdown_pro_submit_text_textarea":"","_monsterinsights_skip_tracking":false,"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[1],"tags":[],"class_list":["post-919","post","type-post","status-publish","format-standard","has-post-thumbnail","category-uncategorized","entry"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t