Sandler Rule #9 - Every Unsuccessful Prospecting Call Earns Compound Interest
Compound Interest. According to Wikipedia, it is defined as: “… the addition of interest to the principal sum of a loan or deposit, or in other words, interest on interest.
It is the result of reinvesting interest, rather than paying it out, so that interest in the next period is then earned on the principal sum plus previously accumulated interest.”
This is probably my favorite rule from David Sandler. He knew that prospecting is an “investment,” and this is a great attitude to choose towards it. When we ‘invest’ in something, we typically get or expect a return. If we take a safe and conservative approach, we will get a small but predictable return. However, the more risk we take, the more upside potential.
A financial advisor would say here that there’s a risk of loss as well, but I’ll argue that from a prospecting perspective if you take bigger risks (while maintaining a moral and ethical line) then you’ll actually get a huge return in the area of experience, even if you fail!
For the sake of this discussion, let’s define prospecting! Prospecting is the activity of creating net new conversations in order to identify opportunities with new clients. We may do this in several ways, such as:
- Cold calling
- Networking
- Free Talks
- Association events
- Trade Shows
- Etc…
2 Main ways to earn ‘Compound Interest’
Too often sales professionals get hung up on the wrong end of things. We worry about whether we should or shouldn’t, how we did or did not do, how others perceive us, etc., versus looking at each interaction as an opportunity to learn.
This is where one opportunity for ‘compounding interest’ occurs. If we take each individual interaction and extract one ‘lesson learned’ from it then we can continually improve making each successive prospecting attempt better and better until we achieve expertise.
A second area for ‘compounded interest’ occurs when we interact in the above ways with excellent technique. In Sandler we work towards one of three outcomes in any sales interaction. These could be a NO, a YES, or a CLEAR FUTURE.
Regardless of where we end up, if we perform with excellent technique, then we will have taken the prospect through an experience that stands out from others. This provides us the opportunity to execute (among other things) our referral ask. Getting a referral early on definitely compounds interest for the sales professional!
A simple tweak of our attitude or mindset in relation to prospecting can make an incredible difference in the return that we get from whatever the prospecting activity is. Want to learn more? Reach out to us or better yet, come crash a class and learn how to maximize your ROI on your activities. https://www.wilcox.sandler.com/crash-a-class
