Creating Value & The Gold Watch

by Victor Antonio, Sales Influence

The story is true.  The names have been changed to protect their privacy.

When I first started selling technology products into Latin America, I was invited to attend one of the company’s first international sales retreats.  This would be my first time attending.  I remember one day in particular where we had rented out a suite on the top floor of a luxurious hotel.  The view of the ocean was magnificent.  As I stood by the door a young man came in, we’ll call him Thomas.  He barely acknowledged my presence.  I could tell he was looking for someone in particular. 

About fifteen minutes later, while nursing a beer and talking to one of my new distributors, I felt a tap on my shoulder.  I turned around and it was Thomas.  This time he introduced himself, extending his hand and saying, “I’ve been looking for you, can we speak in private.”  Thomas wasn’t much for socializing; he was all business.   And the more I got to know him over the years, I realize that was his modus operandi. 

I remember us both stepping outside on the balcony to talk.  He immediately launched into this long story about how he needed my help because his business was struggling and he was losing market share to his closest competitor who I later found out was his cousin. 

Let me take a step back for a moment and lay this story out.  At the tender age of 18, Thomas was given one million dollars by his father so that he could start his own business.  This was part of the families rich tradition.  Across town, Thomas’s cousin Luis was also given one million dollars by his own father so he too could start his own business.  Both decided that there was money to be made in the telecommunications business so they both went out and invested close to five hundred thousand on setting up their business and building out a radio network system to offer paging and cellular service in Panama.  Luis bought a system that was manufactured by Company A.   Thomas, hoping to out do his cousin bought an equivalent system from another manufacturing company we’ll call Company B.

Within six months, both cousins were competing hot and heavy for subscribers.  It wasn’t long after that Thomas began to notice that the more subscribers he put on his system, the more the system would ‘hang-up or drop’ calls.  After a couple of months of inconsistent service, Thomas started losing subscribers who were cancelling their service and then signing up with his cousin.  This is why Thomas wanted to speak with me.

Our company sold a system similar to the one Thomas had purchased.  Our system had the right technology and system flexibility to address his problems.  Thomas was hoping to find a way to swap out his existing system with the one we offered. The problem?  To swap it out he would lose his initial investment and the new system would cost him another $4000,000 and some change.  This was pretty much all the money he had left from his initial one million dollar gift.

As he told me his story I knew he was in a bad situation.  I mentioned that I would help him redesign a new network architecture and at the same time we could swap out his system and replace it with ours.  Thomas was hesitant to move forward with my suggestion for two reasons: a) he was unwilling to use up the rest of his investment on another system and b) he wasn’t 100% convinced that our system would work.  In short, he didn’t have the money to buy our system nor the faith in what our system could do for him.

The following week after returning from our international sales meeting, I laid out the scenario to my vice president.  I told him the situation and how this young man was stuck with a system that didn’t work and how he was hemorrhaging clients.  Thomas essentially owned a white elephant and he didn’t know how to get rid of it.

My boss told me to walk away, but I just couldn’t.  My boss refused to discount our system sufficiently to make the sale viable for Thomas and he also refused to approve any type of long term financing for him.  I wanted to help, but I didn’t have the authority to approve any action that would help Thomas out.

Then one day, out of the blue, an idea hit me.  What if I was able to find a buyer for his existing system, apply those earning to the system we would sell him and negotiate a win-win installation fee.  My boss looked at me as if I had gone off the deep end.  I told him I could probably find resellers who would buy Thomas’ system, at a discounted price of course.  Reluctantly my boss gave me the go ahead to find a buyer and make this deal work.

It took a few months, but we did it.  We found a buyer for the existing system who shared with me that the system would work well in his country because the population density was much lower than the city of Panama and frankly, that made me feel better about the sale. 

After selling the old system, redesigning a new network, we began to swap out the old system pieces as a time to ensure a smooth transition.  Three months later the new system was up and running.  Clients barely noticed the switch-over and system complaints from users was dropping dramatically.  Thomas wound up investing another $200,000 for our new system and we applied the revenues from the sale of the old system to complete the deal.  All in all, he still had $300,000 to market and run his business.  And within 6 months of installing the new system, Thomas was again competing on equal footing with his cousin.  His business grew steady and he was able to begin recouping his initial investment. 

Lesson #1:  My concern for Thomas was sincere.  I felt bad that he had already sunk that money into an initial system that wasn’t working.   But I also knew that for us to help him and ourselves in the process, we would have to find a win-win scenario that we could both live with.   My conversations with Thomas were tough and direct from the outset.  I let him know where he stood and I didn’t make any promises as to what I could or could not do for him.  Clients who need help want to know you care.  And sometimes, you can demonstrate how much you care by simply being direct and honest.  Don’t tell the client what they want to hear, tell them what they need to hear if you really want to help them.  Never over-promise and keep expectations in check.  

Lesson #2:  When I went back to management with my swap-out idea, they were resistant to the strategy and questioned why I was even wasting my time.   Although they suggested I walk away from this ‘dead deal’, I couldn’t.   Call it a salesman’s hunch.  The result?  Three years later, after the installation of the new system, Thomas became the clear front-runner in Panama and began to expand his network across the island.  What did that mean to us?  Although we sold Thomas his first system with razor thin margins, we quickly made up the difference with steady orders we were receiving as his business grew and he needed to expand his network.  Three years later we had an ROI north of 400%. 

Sometimes you have to be willing to risk a lot for what you believe is the right thing you do.  If you care about your clients, if you care about winning, then all you have to do is take the time to care about your clients.  Granted, you can’t do this with every single client.  But the best salespeople learn to look beyond the obvious and see things (i.e., opportunities) where others might not.  Creating great client relationship begins with creating value for our clients and customers.  Customers need help and we as salespeople need to stop selling and start helping our clients find ways to solve THEIR problems, not ours (e.g., meet our quarterly quota).   That’s selling value!

Personal Note: About a year or so after the system was installed successfully, Thomas and his father invited me out to dinner to say thank you.  After dinner, they presented me with a beautiful gold Swiss watch by Chopard.  Apparently only so many of these watches are made a year.  It’s an expensive watch and I still have it.  I share this with you to highlight that selling is much more than selling products or services.  It’s about helping people (and their business) achieve their goals.  And once in while, not always, a client will take the time and make the effort to show you how much your efforts are appreciated.  Moments like these far exceed the value of a great watch.  That’s what selling is all about; moments.  And yes, I did claim the watch and reported to my superiors.  Ethics above all else is what makes or brakes sales careers.