Last week we discussed “The 3-Step Process of Informed Selling”. Today’s blog we will focus on step two of the process – Research. Before you meet with a decision-maker, you need to do some behind-the-scenes research. You need to dig up any and all information that will help you connect the dots for your prospect. The following scenario – shared by an attendee at one of our trainings – proves the point.
Chris (not his real name) was hoping to convince the owner of a local hotel to upgrade his air conditioning system, which was well past its useful life but still operating thanks to a lot of maintenance and crossed fingers. The hotel in question was located in Central California, a place where temperatures soar in the summertime. Chris knew that the current AC system was no longer able to maintain design temperature in the hot summer months – both the hotel’s engineer and the front desk manager had shared that several guests had given them each an earful lately on how their rooms were hotter than they bargained for. Unfortunately, the hotel’s owner was out-of-state and not inclined to spend any money on this particular property. He was concerned about the Central California economy and had decided to limit any further capital investments in his properties there. Chris knew he needed to compile an inarguable case for upgrading the AC… something that would “shake the Etch-A-Sketch” for this out-of-state owner and draw a new picture that would shake loose some capital.
So what did Chris do? He first paid a visit to the hotel’s night auditor. Why the night auditor? Because he’s the person who has first-hand knowledge of how many rooms they’ve rented in the preceding days, weeks and months. He is the person who knows in which direction the average daily room rate has been trending over time. He has a keen understanding of the hotel’s break-even point. Bottom line: the night auditor was Chris’ ticket to understanding the impact that AC-related declines in occupancy might be having on this hotel’s P&L.
Chris explained, “Listen, I’m working with the owner to evaluate some potential capital improvements and a question popped into my mind the other day that I bet you could help me with. Have you noticed any trends in occupancy in this hotel in the last six months?”
Alas, much to Chris’ satisfaction, the night auditor shared with him that occupancy had been consistently falling over the last few months; they were now almost $40,000 a month lower in income compared to last year’s figures. Chris then circled back with the front desk manager, a couple local travel agents, and a few other folks in the community. Guess what? The word on the street was that this hotel could no longer maintain design temperature in the hottest summer months. People now knew the property as “the hot hotel” – and by “hot hotel,” they didn’t mean the latest “must-visit” boutique property!
Shortly thereafter, Chris called the owner and laid out the facts. “You say you don’t want to spend $250K upgrading your AC… Well guess what? For the last few months, you’ve actually been paying for the system that you refuse to buy.” When the owner replied, “How’s that?” Chris shared the results of his conversations with the night auditor, front desk manager, and others in the community. “Whether you know it or not, you’re on a glide path to lose a quarter of a million dollars in lost room nights (which happens to be the entire cost of the AC system I recommended to you last month) because word on the street is that you can’t control temperature during the summer months.” He continued, “What do you think is going to happen when hotels.com or Yelp picks up on the fact that your property is ‘hot’ – and not in a good sense? The locals already know it, which is why you’re seeing less people referring visitors to your property. What happens the next time someone from hotels.com drops in for a summer night and you get dinged a couple stars because your rooms aren’t cool enough? Now your $40K-a-month loss becomes even larger. And at what point do the lost room nights put you below break-even?”
As you might imagine, this carefully assembled information, presented in such a compelling manner, did the trick. The hotel owner would be crazy not to take action when presented with the reality that the room nights his property had been losing represented more than the debt service on a new AC system.
The moral of the story? It’s all about having the insight and persistence to go behind the scenes and get tactical information that you can then communicate to the person who has the power to effect change. Even the most reluctant prospect can become a buyer if you invest the time to research and connect the dots for them.
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