Selling Big vs. Selling Small

I am a huge fan of Scott Adam’s theory of energy which he presents in his book “How to fail at anything and Still win big.” To paraphrase: “The filter you should use when deciding what to spend time on and what to avoid is energy. Focus on the things that give you energy, cut everything that drains your energy.” I could not agree more, especially when it comes to attempting to persuade people to do things.

Certain ways of selling things drain people’s energy, other ways of selling increase people’s energy. It shouldn’t be a surprise to learn: People are convinced by messages which give them energy and tune out of messages which drain their energy.

While this may sound obvious, every day, my inbox fills with people trying to sell me things in a way that evaporates my energy and gets their solicitations dragged directly into the trash. I call this selling strategy “Selling Small.”

Selling Small attempts to use a variety of indirect, ambiguous, open-ended, dishonest or time-wasting techniques to persuade someone to buy what you are selling. The net effect of this is almost always to drive people away by draining them of their energy.

Selling Big is at the opposite of Selling Small. Selling Big focuses on attempting to increase people’s energy by speaking in a direct, time-saving, ambitious, unambiguous way. Lets compare some examples.

Selling Small vs. Selling Big: A Case Study

A typical small seller writes me an email like this:

Dear Mr. St. John,

We specialize in services x,y,z and have been doing business for 10 years in various generic IT services which are ambiguous and undefined. Would you kindly commit to wasting an hour of your life on the phone with us during your busy week? 

Here is a long list of other things we do and 50 of our clients (excluded for brevity).

Boring you to death and wasting your time, some random people.

Can’t you just feel the skin crawling on the back of your neck when you read this email? If you are like me, you immediately terminate messages like this from your inbox. Humans instinctively hate small sellers. This message is particularly horrible because of how open ended it is – You have no idea what to expect when having a future interaction with this person.

Now lets compare to a big seller:

Dear Mr. St. John,

Do you want to spend the rest of your life selling sugar water? Come with me if you want to change the world. 

Steve Jobs

Steve Job’s email below fills me with energy. I am genuinely curious to follow up with an email like that because of how ridiculously motivating and aspirational it is.   Steve isn’t really selling any particular service or product here, he is selling energy.

If you are human, you gravitate towards energy and want to be close to it. If your sales messages drain people’s energy, forget about selling them anything.

To Summarize:

Small Sellers:

  • Use deception
  • Are ambiguous about what they want to sell you
  • May not even know what they want to sell you
  • Are energy vampires
  • Seem like they will waste your time
  • Breed distrust
  • Sell sheepishly

Big Sellers:

  • Are completely direct
  • Do not hide anything (that you know of)
  • Ask for exactly what they want
  • Paint a giant picture
  • Outline precisely what they are selling
  • Deliver an energy bump
  • Sell aspirationally

Stochastic vs. Deterministic Time Management

I have written a little bit about stochastic productivity techniques relating to email, in this blog I will talk about stochastic time management (involving a random variable).

In deterministic time management, we hold a tight pre-planned schedule of places to be and things to do at all times. If I have a call at 6pm, I dial in on that call and so forth. This is the most common method of time management used by most people.

Now lets examine a random form of time management. When Arnold Schwarzenegger was governor of California, he was famous for being impossible to schedule a meeting with. His policy was that if you ran into him and wanted to have a meeting, you would have the meeting right then and there otherwise he wasn’t interested.

This method of managing one’s time is fairly shocking to anyone coming from the corporate world. Can you imagine leading a life of random encounters with random people based entirely on whoever wanted to have a meeting with you at that point in time? How is it possible that anyone, especially a governor of the world’s most valuable economic state, could organize their time in such a chaotic way?

When I think about it from Arnold’s point of view, I can understand. Imagine all of the overhead in planning and flexibility you need to have in order to keep a fixed schedule?  If you need to be at the office every day, it instantly vaporizes a couple hours of your day. By having to be someplace for an arbitrary time period every single day, you inherit a tremendous amount of time management overhead, time which many people would certainly rather use to do…actual work.

As a governor with thousands of people trying to schedule meetings with you and little ability to filter who is a waste of time and who isn’t, you might save a tremendous amount of time by operating on a first-come, first-serve basis.

Instead of filling a schedule up wall-to-wall with meetings, Arnold’s system allows a sort of rolling productivity which gives him the flexibility to run his own schedule and forces people to come to him if they really want something.

 

Stochastic vs. Deterministic Use Of Email

Email is an extremely powerful tool to project influence into a given ecosystem. Building on previous blog posts where I outline the concepts relating to stochastic vs. deterministic productivity techniques, in this blog I will talk about different ways to look at email.

Most people use email deterministically (with few or no random variables). Imagine the following, common, transaction using email. Lets say I am a customer and I want to order a flower delivery from a flower shop. I fire up my email client, send the owner an email and ask them to deliver such-and-such a bouquet to such-and-such address by a specified date.

I call this “Deterministic” because there are no random elements anywhere in this transaction. At no point is there any question about what is being asked for, whether the request will be fulfilled or how much the product will cost. All information is clearly known by both participants and it results in a smooth transaction.

We are all familiar with this type of email use. It is simple: We want something, we send an email and we get a response to fulfill the request. I would guess that this type of email habit is the most common method used by the vast majority of professionals during their standard business day.

Now lets visit how CEO’s, salespersons, email marketers and savvy entrepreneurs use emails: Stochastically (having a random element or variable).

In the stochastic use of email, the person sending the email does not know what response they are going to get. They also do not have a discrete request and are unaware of the recipients willingness or ability to respond to the request. They may also not know how much will or won’t be paid for the service they want to order or sell. Stochastic email is a shotgun blast in the dark, the result of an educated guess.

Lets say I am a CEO whose company sells design services. My company offers a huge range of marketing services and I have a portfolio of 100 shipped products. It is rather impossible and unreasonable for me to expect to put my entire corporate portfolio in an email solicitation to a potential customer. I have to narrow it down, I have to introduce a random element and I have to guess what a potential customer is going to respond to when I send them an email.

So my CEO puts together a list of 30 marketing executives at 30 companies in my target market and I send them all an email. In each email, I customize three services I sell to their particular company and outline opportunities for collaboration. Every email is different, customized and contains a random element.

Unlike the deterministic use of email I outline above, there are many questions…does this executive have a design firm of choice already? Do they even need design? Are they on vacation? Are they so busy that they don’t have time to respond? Do they ignore all the email they get? Does the font in my email anger them? It doesn’t matter, you need to send these emails anyways or you will never get new business.

Unlike a deterministic email, which has a 100% success rate, a stochastic email strategy may have a hit rate of around 25%. However, it allows the CEO or business development professional using this technique to significantly increase the potential range of success if they approach the problem intelligently.

Email is only one area where deterministic and stochastic strategies offer stark contrast, I will be writing about more in future blog posts.

 

Stochastic vs. Deterministic Management Techniques

I have been increasingly interested in the topic of stochastic vs. deterministic business development and management techniques after spending the last three years developing a large ecosystem of partners around Intel’s inventor platforms.

Deterministic work techniques are those where there is a clear relationship between me doing something and that thing getting done. If you buy a carrot and chop up a carrot with a knife, you have a 100% chance of winding up with a pile of carrot parts once you are done. The carrot-chopping productivity technique can therefore be said to be deterministic. The carrot and the knife are fully under your control and you have total power over the outcome of the task, unless an extreme edge case such as your house collapsing were to occur to interrupt your attempts.

Stochastic techniques are those where the best you can do is attempt to influence a chaotic, random system. Imagine you are standing next to a prison with a 30ft brick wall around it and wish to try to promote a prison riot. You might attempt to throw bundles of grenades and guns over the all to the inmates, but you can’t see whether they have actually caught the weapons. You can influence the system by introducing a change but you have no guarantee that you have caused a riot until you hear the inevitable gunfire and explosions that would follow if your plan were a success.

Ecosystem development and senior management have a similar problem. When an ecosystem manager tries to get their ecosystem to do something or a senior manager attempts to get their 5,000 person division to do something, they lack direct control. At best, we can attempt to influence direction but are not able to completely control the people and partners under our control.

To people used to working deterministically, this class of productivity is a complete shock. Most can’t handle the truth!

As a former developer, I am used to having complete control over my work stream. If I program a computer to do something, it does exactly that thing. If it is broken, it is because I did something wrong and mostly for no other reason. This mindset of perfectionism and total control works great for developing software but is a complete failure when it comes to working with people I don’t manage, especially a diverse and heterogeneous ecosystem of partners and developers similar to what I have at Intel.

The nagging feeling that I do not control all of the participants in the market, am unable to force them to do anything (though I am able to incentivize certain behaviors) and have no idea if they are producing the thing they said they are producing has lead me to develop a new set of productivity techniques specifically designed to manage this problem.

I will talk more about those in other blog posts.

 

The Grappling Hook Model Of Business Development

I had a great conversation with a CEO who is far more skilled at business development than I will ever be a few years ago and he shared this tidbit when I asked him how he is so effective at his job, he called it “The Grappling Hook Model.”

Here we go.

If you imagine a corporation you want to do business with with N employees as a rich merchant vessel and your small startup of Z employees is a marauding pirate vessel pulling along side, a business engagement is similar in nature to throwing a handful of grappling hooks into that merchant ships to try to make “something” work. Something, in this case, is a project, contract, service you are trying to sell.

Lets take this logic to the example of a first business meeting with a potential customer: If you bring five employees and they bring five employees to the engagement, you have 25 chances (5×5) for one more employees on your side to make a personal connection to one or more employees from their side.

These “success chances” are the metaphorical grappling hooks. The more you throw, the better your odds of having one of these grappling hooks “catch” resulting in a business arrangement.

Your odds for success increase when you bring more potential areas of collaboration and a heterogeneous team to meet a heterogeneous team from their side. Maybe your engineer doesn’t like their engineer, but your designer might like their designer and so on. By bringing more people and more ideas, you multiply your success chances of developing an ongoing business relationship in a non-linear way.

The best business development people I have seen come to an all-day meeting with a slide deck and 20 ideas customized to the customer. These experts keep things congenial and spend each slide talking about each idea. By bringing more ideas and a good mix of employees, you significantly increase the chances for something working.

Compare this to the classical sales approach of me coming to your company to pitch you on yet another piece of CRM software. By only having one thing to sell and one thing to talk about, you reduce the number of grappling hooks thrown down to “1.” Chances are, that grappling hook will miss.

 

A Stochastic Mindset To Business Development

I suppose before I continue ranting about the topic of linear betting versus stochastic betting in business I should mention why this topic interests me. My job involves supporting a global ecosystem of more than 100 partners in the hardware space, each with their own talents, interests, experiences, capabilities and business realities.

Over the last three years, I have spent a tremendous amount of time attempting to get my ecosystem to produce more value, faster and for cheaper using a variety of strategies, carrots and sticks, motivations and other persuasive techniques. Some have worked, many have failed. Overall the results have been both educational and completely random.

As a result of my experience in ecosystem development and having observed some truly great business development gods and CEOs in the technology space, I believe that real success is more commonly achieved by embracing stochastic (meaning techniques relying on statical randomness) approaches to business development rather than linear approaches.

I have seen too many times how those who fall in love with a single approach experience a significantly decreased chance of success across the board. I call this approach a linear approach or a waterfall approach to business development. Linear thinkers nearly always fail for the same predictable reasons while their stochastic peers continue to thrive.

Unlike the linear thinkers who enter the casino, place all their money on one slot of the roulette wheel, lose all their money and then return the next day to repeat the experiment, stochastic thinkers play a different game. A stochastic thinker understands that they are a participant in a vast marketplace of suppliers, problems, solutions, producers, customers and ideas. Instead of making a single bet over and over again, a stochastic thinker makes 10 bets in 10 different games every week. If one of those bets works out, they return to that bet and introduce five more variations of it to five more customers to further develop it.

A linear thinker focuses on promoting a very narrow product or idea to a wide audience based on their own interests and motivations. A stochastic thinker views all products and projects as connected by a set of general themes but does not fall in love with any one of them (not unless they produce value).

Imagine a salesperson who only sells one particular type of mop knocking on the door of every house in a neighborhood hoping to sell those mops. Their chances for success will be quite low. Not everyone is in immediate need of a mop. Now imagine a salesperson who has 15 different household products solving a variety of problems knocking on each door. While not everyone needs a mop, you are certain to find 3 people needing dish soap, 5 needing toilet paper, 2 needing a vacuum and another who wants a broom. Both salesmen spend the same time going door to door and the same energy talking to customers, one of them will do far more business than the other by bringing a portfolio of ideas with them.

The above example focuses on a more retail use case, but the lessons are the same as in knowledge work and creative enterprises. In coming blog posts I will talk about techniques which I see great CEO’s using to increase their odds of successful “hits.”

The Dangers of A Linear Mindset In Business

Most people tend to pursue their ideas for businesses and projects in a linear fashion. Maybe they have a conversation, arrive at a “Great Idea,” fall in love with it and pursue it over the course of several years. Other people are highly attached or addicted to one particular problem domain and stick with one idea and grind on it, regardless of whether or not it is an idea which shows signs of progress.

I call this type of mindset a “linear mindset.” Linear thinkers tell themselves: “If only I just keep doing the same thing forever, I am going to succeed eventually.” Sometimes it works, the vast majority of times it fails. Taking a Linear approach to business or ecosystem development is kind of like waltzing into the Casino, dumping a giant pile of chips on one particlular square of the roulette table, losing all your money and then returning the next month to do the exact same thing again.

Linear thinkers bet the farm on the same unlikely outcome over and over again because you love the color of that particular square on the roulette wheel – It is bad business, I have seen cases where very smart people do this for years! Really! Falling in love with an idea is one of the most dangerous addictions that can happen to an entrepreneur. I know, I have made this mistake several times myself.

So what is the solution? I will write more about this in coming posts.

The Animal Farm – Part III

The Animal Farm hosted numerous types of animals of various sizes. There were cows, which had holes cut in their sides with plugs so that undergraduates could observe their gut contents and even open the plugs and extract half-digested cud-matter. I still don’t know why anyone would want to do this. Then there were the goats, small and mischievous, able to squeeze their fat-looking bodies between cracks of small size. They were constantly escaping their cages.

Then there was the pig, his name was Buster. Buster weighed over 1,000 pounds and was as fat as he was friendly. One former shit-shoveler learned that Buster’s friendly nature came with a price after the male hog ripped a giant slice into their calf while playfully rubbing his face on the hapless farmhand. Buster’s tusks jutted out from his lower jaw, jagged and sharp. A 1,200 lb pig can do a lot of damage with one friendly face-rub. It took 13 stitches to close that wound.

“Never get in the pen with Buster unless he is distracted by food,” warned the professor.  The algorithm for shoveling shit out of Buster’s pen was to fill a bowl with food, throw it into the corner, allow the massive pig to begin eating and then rapidly shovel and clean the pen and leap over the fence before Buster finished his meal. Cleaning Buster’s pen was the scariest part of my day.

Large Animals and Food

Large animals, for the most part, are single-minded bastards when it comes to food. If they know you have food in your hand, they are going to come at you in a straight line and do anything to get that food. This includes, stomping, trampling, biting, head-butting or pushing you until they get what they want. The larger the animal, the more dangerous this is.

Cows and other large livestock have zero self-awareness about the damage they can cause to those around them. They also lack any sort of empathy. I learned this the hard way when I got into the pen with a 300lb male sheep who promptly began ruthlessly head butting me into a corner. I was genuinely terrified that I wouldn’t be able to escape and only managed to make it over the gate after hurling the bowl of food I was carrying across the pen in panic. I didn’t do that again.

The professor taught me that if I feed the small goats in the yard, I could never lay down food between them and the cows. The smaller, faster, goats would run to the food first. The cows would arrive afterwards and trample and crush them under their hooves. She warned me sternly to always make sure that the goats were separated before attempting to feed the cows.

Of all the animals, the goats where the most constant source of amusement and chaos. On one occasion, while attempting to feed the yard-goats, one of them snuck it’s head into my feed bucket while I had my back turned and ran around the enclosure knocking the bucket on every metal surface while making shrieking goat noises. The racket motivated the other goats into action, they chased the lead goat in circles while I bemusedly attempted to catch and remove the bucket.

The Animal Farm – Part II

The leading character of the animal farm was the professor. The professor was about 4 1/2 feet tall and maybe 55 years old. She earned her “professor” title by teaching animal science at UMASS when she wasn’t engaged in farm activities. As we spent the summer together, she taught me many strange and wonderful things. Unlike most people I had ever met before, the professor possessed a super-human ability to find humor in the macabre world of animal science.

“See this?” Said the professor? “You can see the worms in there, look closely.” She was holding up a vial of…well…shit…up to a lamp and encouraging me to look closely at the contents. I had just captured a small goat at her urging and she had plunged a gloved hand into it’s rear-end to extracted the sample which she was now proudly waving in my face.

Sure enough, I could see several thread-like unwelcome guests squirming about in the vial. How about that, worms! Solving this unwelcome outbreak involved me holding down several goats and pinching a flap of their skin while the professor jammed a massive horse-sized syringe filled with white mucous-like substance into the little goat’s neck.

“You have to get it through both layers of the skin,” she said as the goat bleated piteously. “If you only puncture half way, we just get a bubble there between the skin layers.” I could see a bubble forming and I took my hand and rubbed it until it went away. Another goat cured of the plague.

This was what life was like working with the professor, every day a new surprise.

The Rage Slot Machine

It is impossible not to be morbidly fascinated with the current political situation in the United States. After the election, I was completely convinced that people would “learn their lesson” about the interplay between Donald Trump, facts and the media. After taking a hiatus from watching the ongoing train-wreck, I can only conclude that nobody has learned anything and that the same patterns which kept Trump on top of the news and the center of attention will continue forever.

Fool me once…shame on you. Fool me…496 times…shame on uh…human nature?

Today I came up with the perfect analogy about how Donald Trump’s communication style works: He is literally a communication slot machine that dispenses self-righteous rage instead of coins.

You keep pulling the lever and you keep getting different results, keep getting enraged and keep returning to the same flawed media outlets to repeat the “fun.” I use the word “fun” for a very particular reason: People seem to enjoy getting angry at Trump. No other analogy explains the behavior I am seeing online of people constantly being fooled by the same media sources and constant sense of outrage caused by Trump’s every action.

After FiveThirtyEight and 99.99% of the media completely whiffed on Trump, I truly believed people would stop believing them. Now I believe something more sinister is at work.  We aren’t being tricked by Trump, we are addicted to being angry at him and can’t help ourselves.