Book Club: Todd Caponi on the Power of Transparency in Sales
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Olivia Fuller: Hi, and welcome to Book Club, a Sales Enablement PRO podcast, I’m Olivia Fuller. Sales enablement is a constantly evolving space, and we’re here to help professionals stay up to date on the latest trends and best practices so they can be more effective in their role.
When most people think about the act of selling, they often think that it’s all about making something seem desirable to motivate someone to buy it, but what if it was actually about the opposite? This is an idea that Todd Caponi explores in his book, “The Transparency Sale,” where he makes the case that leading with your flaws and actually embracing vulnerability is the key to building buyer engagement. As Todd puts it, effective sales today requires radical transparency, and he’s here to tell us a little bit more about why this is so essential. With that, Todd, I’d love if you can introduce yourself to our audience and tell us a little bit about your book.
Todd Caponi: Cool. I’ll do it in story form because I think it’ll crystallize this. I’m a multi-time sales leader. My last role was the Chief Revenue Officer of a company here in Chicago, where I am, called PowerReviews. You could probably guess from the name PowerReviews, we were in the space of helping retailers and brands collect and display ratings and reviews on their websites. Meaning you’re buying a pair of Crocs or a sweater on Vineyard Vines or whatever, you look at the product, you scroll down, there’s the reviews. That was us for many cases, doing the collect and display.
Here’s what happened. We did a research study with Northwestern University here in Chicago that looked at when a website’s acting as a salesperson, i.e., an e-commerce site, what do people do? What do human beings do? There were three data points that came back from it. Two of them changed my life in only a way that could be changed for a nerd like me because I’m super behavioral science data nerdy.
The first step that did not change my life was that we all read reviews today. I’m assuming, Olivia, when you’re buying something that you haven’t bought before, you probably read reviews first, but here’s the two that blew my mind. Number one, that 85% of us go to the negative reviews first. I don’t know if when you’re reading reviews, you skip the fives and go right to the fours, threes, twos, and ones, but that’s what most of us do. The second data point that changed my life was a product that has an average review score between a 4.2 and a 4.5, that range on a five-star scale is optimal for purchase conversion. You’re selling something on a website, right under it somebody who’s bought that comes back and says, I hated this product, here’s why, and it’s right under the product, somehow that actually helps it sell more. I looked at that and thought, alright, that’s when a website’s acting as a salesperson, what happens in human to human or B2B selling? Should that dynamic be the same? As it turns out, it is.
I found really, really quickly that, again, if 85% of us go to the negative first, it’s what our brain desires. When we start a conversation by embracing something that maybe we’re not great at or that we give up to be good at our core or a competitor that we’re looking at might be better at than us, when you lead with that, magic happens. Sales cycles speed up, win rates get better, we work deals we should be working, and we stop working the deals that we’re going to lose anyway, we lose faster. From trying it out and seeing that magic happen, I like a lunatic, quit my job and wrote the book, “The Transparency Sale,” which really talks through not only the data, but the behavioral science, and then how you apply it to every single stage of your sales process from positioning and prospecting to even negotiating and post-sale clients.
OF: Yeah, I’m glad you brought that story up because I think that helps put this into context a little bit more with actually one of the key points that stood out to me in your book, which was that embracing imperfections and prioritizing honesty is really how salespeople can better engage customers. Can you tell us a little bit more about this? Why does transparency, even in maybe areas where a product or service fall short, how does that help build loyalty?
TC: Well, yeah, there’s a couple of things. First of all, if you’ve been to Ikea before or Costco or been on a Southwest Airlines flight, those organizations, those companies, those retailers, they embrace the things they give up. Ikea is a nightmare. When you walk into an Ikea, you know you’re in for it. When they hand you a map, you’re like, I need a map to buy stuff? What? Then you’ve got to find it, you’ve got to go to the warehouse, pull the boxes off onto carts that don’t have brakes, jam it into the back of your car Tetris style. swear your way through that, get it home, thinking that you just left the nightmare back at the store. Instead, you open up the box, there’s 150 parts and no words on the work instructions other than like Sparta or whatever their crazy brand names are, and then when you’re done, you’re like, oh, you know what, that looks pretty good. We should go back. we should’ve bought the end tables with that bedroom set. Ikea shoppers, it’s a nightmare, yet they’re incredibly loyal. They’re the number one retailer for furniture in the world for 13 straight years.
Costco, the same thing. You’ve got to buy a membership, there’s very limited brand selection, if you want some ranch dressing for your salad you’ve got to buy almost a gallon, if you need a toothbrush here’s a half dozen, we’re going to have somebody at the door that’s going to check your receipt to make sure you’re not stealing anything. And yet, number two retailer in the country is Costco behind Walmart.
The point being that obviously over promise and under deliver is a bad idea. We all know we never should over promise and under deliver, but there’s something crazy I discovered. Under promise and over deliver is also bad because it creates a short-term satisfaction spike, but it becomes unsustainable, and it is a form of lying believe it or not. We get something I like to call expectation inflation. If we keep doing it, then I’m going to take what you tell me and I’m going to add a little to it, and if I don’t get that, I’m going to be disappointed.
The point being that in our brains as human beings, when expectations are set properly, and we feel like we trust that we can predict what our experience is going to be like, that’s what triggers our decision. When expectations are set and consistently met over and over and over again, that’s what creates loyalty. You go to a Starbucks here, I’m in Chicago obviously and you’re in Seattle, the heart of Starbucks, the coffee tastes exactly the same. Go to Europe, the Pike Place is still the exact same, it’s consistent expectation setting. It’s building that consistency and that’s what creates customers that not only buy, but they stay, they buy more, and they’re more likely to advocate. I’m clearly biased, but it all starts with transparency and setting proper expectations, not over promising and under delivering or doing vice versa.
OF: Actually, on that point, you also emphasize that every interaction with a prospect is really a decision point for them. What role does empathy play in the decision-making process for buyers, and how can reps really take advantage of every interaction with buyers to not only reduce skepticism, but also build better engagement?
TC: Yeah. Well, there’s a funny thing about empathy, I’ll start there. When I scroll through LinkedIn, and people are like, oh, you’ve got be empathetic, and then they go on to explain it, 9 times out of 10 they’re actually talking about sympathy, not empathy. Empathy is literally being able to see the world through the eyes of the people that you’re trying to communicate with. Empathy actually takes it to the point where you’re almost feeling what they feel along with them. To be truly great at what we do as sales professionals, as sales enablers trying to get into the heads of the salespeople that you’re trying to enable, that empathy, not sympathy, like, oh, I hope things are good in these trying times, that’s sympathy, empathy is, hey, I understand you.
From a buyer’s perspective, I’m going to give you a weird analogy. A quick story. In Seattle, they don’t have Culver’s I don’t think. Culver’s is a fast-food place and they’ve got something called butter burgers and then they’ve got frozen custard, which is heavenly. It’s really, really good. A few months ago, my wife and I and my two kids, who are 8 and 10, we’re out and about and we my wife was like, hey, should we go get some ice cream? My kids with their hawk ears are just like, ice cream? Yeah, let’s go! They’re all excited, so we go drive to Culver’s because they love this frozen custard. We’ve got the means; we’ve made the decision to go there. We get there, the line for the drive thru is 15 cars long and then we can see there’s a bunch of people waiting for their food right on the other side, where the pickup window is. We’re just like, oh gosh, this blows. We get in line because the kids are bought in, they’ve got the means, they’re there, they want this reward. Within two minutes, my ten-year-old daughter leans forward and she’s like, hey, can we just go home? Like really? Then my eight-year-old was like, yeah, I don’t want to wait here. Let’s go. Alright! We were there, the reward is there, this fantastic reward, but we get there and within two minutes, our expectations hadn’t been met. There was this expectation that the journey to the reward was going to be difficult, which in the end made that reward looked less sweet even to a 10-year-old and an eight-year-old.
My point being, when you think about the processes that you take buyers through, expectation setting and empathy, understanding that that perception of a reward may be biased by the perception of the journey to get to it. That’s part of what empathy is. Do you have an opportunity to differentiate in the way that you sell? Part of what transparency does is it does the homework for the buyer.
There was a study in 2017 by the Corporate Executive Board, which is now part of Gartner, that looked at consensus buyers and looked at, how do they spend their time? What they found is 39% of their time was spent talking to you, talking to your competitors, or talking to their internal buying groups. That leaves another 61%. What are they doing? They’re back-channeling you because all they hear is perfect five-star stuff. They’ve got to call their buddies and check with analysts and if you’re in the tech space, they’re going to the G2’s and the TrustRadius’. They’re even reading Glassdoor reviews. That’s homework, that’s like extra cars in the drive through line. How do we reduce those cars in the drive through and make the journey as frictionless as possible? When we do that, because I’m betting you anybody who’s listening, if I say, who’s your biggest competitor, they’re probably going to go, oh that’s the status quo. Yeah, it’s the status quo, and many times it’s not the customer it’s you. This part of transparency is about removing homework.
Now, this was one of those rants, Olivia, but I I’ll just add one little piece to it. Another piece of empathy, we all think that consensus selling is hard. We got to sell and there’s multiple buyers, we’ve got to wrangle them all, how difficult. True, but consensus buying is harder. These buyers, they don’t have a whole organization behind you. Your sellers, they’ve got you, sales enablers. Your buyers, they don’t have buyer enablement, they don’t have processes. The stuff they’re buying from you, they buy once ever. They don’t know how to do this, so consensus buying is harder. Now, add to it that all of those buyers are remote just like you. Consensus buying just got harder. They can’t run into somebody in the parking lot or run into them in the kitchen getting coffee, consensus building for your buyers just became much more difficult.
When we think about the elements of transparency, but just to your question about true empathy, see through the customer’s eyes that at home, it’s added cars to that drive thru. You’re going to find that no matter how sweet that frozen custard is, even the kids look at it, that’s an amazing reward, but gosh, this is going to be too hard, I’m going to prioritize something else. Your buyers are doing that, and transparency is just one of those ways that you can remove friction and make that drive thru line look a lot shorter.
OF: Well, that’s a fantastic story. One of the points that you brought up throughout that was around buy-in, and in the book, you talk about one of the steps to really create resonance with buyers is actually through building a mutual decision plan. What are some of the core things to include in a mutual decision plan and how can that help streamline the buying process for the buyer?
TC: Well, yeah. It goes back to that point about the buyer not having the expertise in buying like you do in selling. How do we remove friction from that buying journey and set proper expectations? I call it the mutual decision plan in book, which is sitting across the table with the individual or across your Zoom or across the phone, and just helping them see what that journey is going to be like. The mutual decision plan really brings all of these pieces together. That perception of a reward being biased by the journey and transparency and true empathy. It’s about sitting across the table and going, hey, listen, when we work with companies like yours, here’s some of the steps that they typically have to go through. Can we just match those up and make sure that we’ve got the journey right?
I don’t know if you’ve ever mountain climbed or anything, but imagine going to Mount Everest, and there’s a Sherpa there that meets you. The Sherpa’s just like, it’s a big mountain, how do you want to go? Which way do you want to go? You’d probably be like we’re all going to die. There’s a confidence that’s built. A lot of salespeople are like, oh, I don’t want to put the customer into a box and feel like I’m creating all these structures around them. If it’s positioned right, you’re giving them confidence that A, you know the journey, and B, you’re setting an expectation about what that journey is going to be like.
That Culver’s example, my family and I, we went a few weeks ago to Gatlinburg and Pigeon Forge in Tennessee. I don’t know if you’ve ever been there, it’s like Vegas for kids, but there’s Dollywood. Dollywood is this big amusement park, it’s a fantastic amusement. You get there and one of the rides the kids wanted to go on, there’s a line. At the entrance to the line, it says it’s a 40-minute wait from here. We’re like, alright, cool. That Culver’s example is when expectations aren’t met, the Dollywood example, we gladly waited in line because they set proper expectations with us. We knew what that journey was going to be. We made the decision. Is the juice going to be worth the squeeze here? We said yes. It was probably like 38 minutes; it was right on. We were cool with it because they set proper expectations.
I think that’s part of the power of, hey, his is what the journey is going to look like, we’ve seen it a hundred times, I want to help you and enable you to get to the goal line in your decision, whether it’s with us or not. Here’s the expectation around it, let’s add in some of the things that are unique to your situation. If you don’t want to go on this journey, that’s cool too. Let’s part as friends right now. I think that’s part of the power of all of this.
OF: Definitely. We’ve been talking a lot about the buyer’s journey and the buyer’s experience, but a lot of that has been in the context of leading up to the initial purchase. It’s just as important to keep customers engaged and continue to drive loyalty throughout their entire experience with an organization. I’m curious if you can tell us what are some best practices for really partnering with revenue teams internally to continue to deliver value through transparency?
TC: This transparency is not only just about the front of the sales process. Friction removal and the buying journey is not about the front either, it’s about the whole process. One of the things that I teach a lot of is this idea called transparent negotiating. I don’t know about you, I always thought it was weird that when we get to the goal line of a deal with a customer, the customer says, yes, it requires a different person to negotiate than it does to sell. As a matter of fact, like I learned how to negotiate from a former FBI hostage negotiator. We’re not negotiating the release of hostages from a bank heist, and this person I’m negotiating with, I need to have a relationship with post-sale. What are we doing?
I had stumbled upon a concept called transparent negotiating, which is basically playing your card space up around the four things that matter to you and every for-profit organization in the world, which is every single one cares about how much you buy, so volume, how fast you pay, so the timing of cash, how long you commit, so the length of commitment and when you sign. Those are four things that we’re willing to pay you for in the form of a discount. Commit to more pay faster, commit longer, help us forecast. That’s another one of those examples of A, you’re building trust to the goal line instead of eroding it via traditional negotiation methods, B, you’re getting value for every dollar you give away in the form of a discount, and C, you’re giving them the cards to negotiate their own deal. You’re removing friction in a big way, and you end up with more valuable, more predictable deals, and you’ve built trust to the goal line. That’s one really important piece that I would hope that everybody would think about. Think about the negotiation that you do.
Now, to your question about sales enablement, I have a slightly different take on sales enablement than most. I’ve got this book, but I’m in the midst of writing my second book right now, which is called, “The Transparent Sales Leader,” that hopefully will be out in February. I feel like sales enablement’s role is essentially three core components. Number one is this idea of what I call amalgamate, which is going across an organization to their leaders and helping to curate all of the requirements across the organization, and then prioritize them and work with sales leaders on we’re going to say yes to these, we’re going to say no to these, and every new thing that comes in is going to require one of the yeses to go away. You amalgamate. The second piece is orchestrate, which is on those priorities, now you focus on orchestrating. What is the most efficient and effective way of getting those priorities and the goals associated with them into the brains of our salespeople in an executable way?
The third piece is what I call evaluate, which is, how’s it working? Measuring, adjusting. Sales enablement is the first line of understanding whether your new hires are going to make it. Having structures in place that allow them to be able to see those warning signs upfront and be able to communicate those. I think when sales enablement thinks about their role, that way, that becomes such an effective partnering mechanism. As a CRO and a multi-time sales leader, when those structures were in place and there wasn’t an expectation that sales enablement is the dreaded sales trainer, no, that’s not the role, the role is to help prioritize, execute on those priorities and then help us see what’s going on in the field. That’s where partnership truly takes place and becomes so valuable. When that clicks, that’s where I, as a sales leader, invest more and more and more in sales enablement.
OF: Digging in there actually a little bit more about enablement’s role, you mentioned this, but enablement often plays a large part in arming reps with the tools that they need to be successful. To your point, it’s also about driving collaboration among key stakeholders. How can enablement really ensure that reps across revenue teams have the knowledge and skills that are really needed to engage with prospects and customers in an authentic way?
TC: In the last three business days, I’ve had five different sales leaders reach out to me going Todd, do you know anybody? I’m hiring sales reps; I can’t find them. There’s such like a frantic mode right there. Before I answer your question, for anybody who’s in sales enablement who’s listening, the thing that I’ve told all of those sales leaders is that right now, according to ZipRecruiter, there is 714,000 open sales roles. Your organizations that are hiring are competing for talent against all of that. Then you add to it that the number of new unicorns that have been established, the funding that are multi-billion dollars that are considered unicorns, year over year, beginning of the year to beginning of the year pre COVID, it’s up 600 percent. That’s only going to get worse.
My advice for all of the sales leaders that I gave was this: look at your job requirements. You’ve got sales roles, you’ve got 10 bullets of the things you’re going to look for, cross off five of them. Right now, find five that you’re going to be fine if you live without, and then double down on enablement. Take one of those head count, take the dollars, and use it to invest in more internal resources to assist enablement, allow enablement to go outside and bring in outside practitioners to fill in the gaps and the holes, and just focus on taking those people that are not quite going to be able to check all the boxes and get them upskilled or out as quickly as possible. You’ve got to do that now. That’s number one on this whole thing.
I guess that answers the question. If you can seek ways to help educate your leaders to understand that conundrum, that you’re going to be bringing in some people that don’t check all the boxes. Then you’ve got to invest in enablement. I know that’ll come across as self-serving, so hopefully my words here will help you, it’ll help you with that justification. The competition for talent is real and it’s not going away anytime soon. I think sales enablement is the success or failure of many of these organizations.
OF: Definitely. I’m so glad that we have you here to share your perspective on sales enablement from the perspective of a sales leader. Digging into that a little bit more, my last question for you is really around, given your background as a sales leader, what are some of the key metrics or things that enablement leaders really need to be tracking to reinforce the importance of transparency and also their impact on business?
TC: Number one, one of the things that I used to screw up is this idea of we need to at all times have four X our quota in pipeline looking across my salespeople. One stat that you can use that’s really effective when you think about transparency is your ratio, your win percentage. That’s really, really important, but there’s another data point, which is time to loss. The deals you lose, how long is it taking you to lose?
My point being, I used to manage my reps and I’d be like, hey, you need to always have four X quota in pipeline because we know we’re not going to close everything. What did the reps do? They filled it four X filled with crap because that was something I was measuring. If you do transparency right, and you lead with, hey, we give up this to be great at our core, our competitor might be better in this area and if that’s going to be important, let’s bet that now, or hey, our pricing based on our understanding of your environment is going to be between X and Y, if that’s going to be trouble, let’s discuss that upfront before we invest a bunch of time in each other. If that won’t match, let’s part as friends right now. What that ends up doing is like I said, it speeds sales cycles because you’ve built it on a foundation of trust, your win rates should go up mainly because you’re working deals that you should be working and instead of working the deals you’re going to lose anyway, you lose them really, really quickly.
The answer, again, is look at your win rate. If you’re only winning 20, 25% of the deals that you’re qualifying, there’s a qualification issue. I bet the transparency upfront would help vet some of that, so you’re spending time on the deals you should be working or you’re spending time prospecting into the opportunities that would be better for you.
That second data point is look across your losses and figure out is it taking us two weeks to lose or two years to lose or six months to lose. If it’s taking you that long to lose, analyze the heck out of that and use that as a really key data point to see whether or not transparency could be a powerful tool to get more efficient in your pipeline.
OF: Fantastic. Well, Todd, thank you so much for sharing all of these insights with our audience. I know I learned a ton from you and our audience I’m sure will as well. Thank you again.
TC: Hey, thanks for having me. As you can tell, I’m such a nerd for this, I could rant about it all day. Again, sales enablement, there’s nothing more important right now in this economy, in this market. If I can be a resource for you or anybody else, please reach out. I’d love to help out in any way that I can.
OF: Awesome. To our audience, thanks for listening. For more insights, tips, and expertise from sales enablement leaders, visit salesenablement.pro. If there’s something you’d like to share or a topic you’d like to learn more about, please let us know. We’d love to hear you.