Primacy, Recency and the Power of Options

sales_proposal_1215So by now you know that I’m a huge proponent of ensuring that your proposal to the customer is carefully thought out and 110 percent customer-centric.

It has to be customer focused, succinct, written in language they understand (no technical terms or jargon), short enough that they will actually read it, and solely focused on displaying how the system improves the customers outcome (their unique need). Let’s assume that we already to all of that.

What can we do to help us secure more business and increase our proposal delivery to secured business ratio?  Personally I’m an advocate for quality over quantity. I would rather our company deliver 10 proposals per month and have 80 percent of them accepted than delivery 50 proposals and only have 10 percent of them accepted.

Borrowing from the field of Psychology we know that as humans, cognitive biases affect and skew our perceptions.  I’m sure some of you will vaguely remember the primacy effect and the recency effect from an undergraduate intro to cognitive behavior psychology class. Quite simply primacy and recency refer to the human tendency to remember and place more importance on the first thing we hear (primacy) and on the last thing we hear (recency). These simple concepts can be translated very powerfully into how we format and structure our proposals.

The most critical information should be placed at the beginning of your proposal (primacy). These are the first things our prospective customers read are likely to be the one thing that they remember best. For me this is the unique customer value proposition, how exactly the system we have proposed is going to address their unique needs and improve their outcome.

Recency says that the next most critical thing should be placed at the end of the proposal. There is nothing more important than the customer value proposition so I want to use the last page they read as a summarization of the customer value proposition and the pros and cons of each of the presented options along with our recommendations (see below for the importance of options!)

All of the other stuff should go somewhere in the middle. This includes the non-technical layman’s terms scope of work, and the actual project price proposal itself.

Here is an interesting tidbit, although debated by the academics when comparing the effects of primacy and recency to each other it has been found that primacy is a little more powerful than recency.

So now our proposals are short, customer-centric, and place the most critical information at the beginning or the end.  What else can we do to increase the odds of securing business?

By far the most powerful suggestion I can make and the one that will have the greatest effect on your proposal close rate is to provide the customer with options. One of the things that I love about AV is that there are always a thousand different ways to design a system that fulfill our customer’s needs. We have a unique opportunity to provide options that almost never gets taken advantage of.  What I mean by options is to provide the customer with two, three, or four different system designs and proposals. The ideal number here is three, each with a slightly differing value proposition.

Providing options changes the customer’s through process from if they should do business with you to how they should do business with you, this one simple change in information processing is very powerful. It changes from a ‘yes or no’ decision to a ‘which option best suits our requirements and needs’ decision. Ideally the options should land at slightly differing overall project values (think +/- 10 to 20 percent) and provide different levels of functionality (certain ones meet their needs better than others). Don’t be afraid to provide an option that is above their budget, often if the connection between the system and the need is strong enough a customer won’t have any problem spending 10 to 20 percent more than their communicated budget.

You have to briefly explain the pros and cons of the different options and as a valued partner you have to make your recommendation linking it to the unique customer need that initiated the exploration of the project.

Bonus Tip – Pay special attention in the proposal review meeting to the customer’s reactions to the different options (you are pre-scheduling a review meeting with the customer before even delivering the proposal right?). How they react will provide you with strategic insights on what is most important to them. Look for non-verbal cues and listen carefully to how they frame the pros and cons of the different options. This is critical information that can be used to strengthen your value position with them for future business opportunities.

Before I get skewered in the comments I know that I’m talking about triple the amount of proposal work (producing three separate system designs). I am an advocate of having an in-depth understanding of the cost of proposal. Producing three options will inevitably be more expensive in terms of time spent. However we are in the business of securing profitable projects; I don’t know any integrator who is in the business of producing proposals. This is one of those more is less concepts. We have to be sure our sales teams are finding and qualifying potential customers.  Customers that have sufficient budget and where the communicated want can be translated into an actionable and profitable need. If your organization throws a proposal at every warm bodied life form that shows the slightest inclination of interest this strategy is going to bury the pre-sales teams without any tangible benefits. If your goal is to deliver fewer proposals to the right customers that have a higher likelihood of resulting in profitable business the effort to deliver proposal options is well worth the additional time and cost.

Bonus tip: These concepts also apply to making a formal presentation to a customer and even in a meeting with the customer. Put the most important information at the beginning or end of the presentation (or conversation) and give the customer options whenever possible. Get them thinking about how to do business with you instead of should they do business with you.

And remember, no matter what you think, the customer really doesn’t want to hear about you. Don’t make the proposal focused on what you have achieved under the delusional ideology that we have to tell them what we have done or that they really care. The only thing that matters is what’s in it for them, how this addresses their needs, and how we are improving their outcomes.