Welcome back to the MPN Thought Leader Podcast series. In this podcast, we speak with industry leaders about their perspective on doing business in the technology industry. Episodes feature interviews with inspiring speakers David Meerman Scott, Jo Burston, Dux Raymond Sy and Mario Carvajal, Carol Roth, Tim Hurson, Kris Plachy, and Mike Harvath and Reed Warren, covering topics from marketing to management to the future of the Intelligent Cloud.
In today’s episode, we hear from Carol Roth, entrepreneur and bestselling author of The Entrepreneur Equation. In today’s episode, Carol discusses how to pitch properly, how to foster customer loyalty, and how to build a better business. From learning how to identify and overcome objections to your pitch to using tangible numbers and examples to create context, Carol explains how you can make your pitch and your business fun, sexy and engaging to better motivate your customers.
Share your thoughts on this latest episode in our Thought Leader Podcast series in the comments below.
[VOICEOVER]: Welcome to the Microsoft Partner Network Thought Leader Podcast Series. In this edition, we’re talking with Carol Roth, entrepreneur and New York Times bestselling author of The Entrepreneur Equation. Today, she tells us about how people are often sales-pitching but don’t realize it and addresses the five pillars of customer loyalty and what motivates different customers.
CAROL: I’m Carol Roth. I am a billion dollar deal maker and entrepreneur, a TV personality, and a New York Times bestselling author of The Entrepreneur Equation.
INTERVIEWER: Awesome. Well thank you so much for joining us today to talk to our partners and do this podcast.
CAROL: I wouldn’t miss it for the world. It’s been so much fun. And I love Microsoft. And the Partner community is really the conduit to get this amazing technology out and in the hands of businesses that transform the world. So what a great opportunity.
INTERVIEWER: You’re going to talk to us about creating the perfect pitch, right?
INTERVIEWER: So what kind of mistakes do people make when pitching?
CAROL: So just from an overall pitching standpoint, it’s amazing to me how often people pitch and they don’t realize they’re pitching. From an internal standpoint, a lot of times you’re trying to onboard your team. You may be trying to onboard your boss. Maybe you’re trying to get other colleagues on board with the new technology, with a new project, whatever it is.
From an external standpoint, you’re obviously pitching to find new customers and grow your business. But you could be collaborating with other partners. You could be looking for other investors. You could be trying to get media coverage. So you always have to be out there and pitching.
I think the biggest mistake people make is not realizing the context of what a pitch is and what its purpose is, which really is to get somebody’s attention and get them interested and engaged to learn more, and sort of establish that connection point for the relationship.
I think too many people try to close the deal and think that, “Nice to meet you. Let’s close a deal right now.” And that doesn’t really happen. So when you have an opportunity to pitch somebody, the idea is to create something that is fun, is sexy, is engaging that makes them want to learn more.
And if you think about where this whole phrase “elevator pitch” came from, it used to be that you would get into the elevator and there would be some mythical executive in there. And funny enough, it was always Bill Gates. So I’ve now removed Bill Gates from the elevator and I’ve replaced him with Satya.
But you get in with Satya, and you have fifteen floors to impress him with this great idea, and then he wants to learn more. He’s never going to close the deal there. So you don’t have to tell him your life story. You don’t have to tell him everything about your business. But enough where when those elevator doors open and he gets out, he goes, “Great. You know, here’s my card. Follow up with my people and we’ll take it from there.”
So I think just having that context about what a pitch is really sets the stage to have a really strong foundation. And then on top of the foundation to layer on specific things that let you take it to the next level and be really, really effective.
INTERVIEWER: That’s great. So it sounds like you’ve really expanded the typical definition of a pitch to include a lot more than just that elevator moment.
CAROL: Yeah, I think that when you practice your elevator moments, you have to be adaptable. So what if those doors were to open and Satya has ten minutes before his next meeting and he goes, “You know what, that was really interesting. Why don’t you follow me? I’ve got ten minutes to learn more.” And you go, “No, I just really have these 30 seconds prepared. I’ll follow up with you.” Like that would be a really blown opportunity.
So you have to be able to vary your pitch by the context of the relationship. So if you and I know each other, it’s going to be a very different pitch than if we’ve met for the first time.
For the format, if you have the elevator ride, or maybe you have an entire car ride to the airport. And so you have to really be adaptable in terms of the way that you communicate.
The funny thing is that people get really, sort of uptight about the whole thing. And they think that, okay, I’m going to pitch now. They clear their throat. And then they turn into an infomercial. “Hey, let me tell you about myself!”
INTERVIEWER: But wait, there’s more!
CAROL: Exactly. Ginsu knives, whatever it is. And they don’t realize that that’s not it. It’s about creating a relationship. And one of the keys — and I talked about this in my speech today — is that it’s like anything else. People do business with people they know, they like, they trust. So you’re trying to build that first now we know each other. And do I like you, and do you seem like a reasonable person. And that often, in and of itself, will give people enough of a touch point to want to learn more. And then you can do the expanded pitch from there.
But people being inauthentic, or being very nervous, not confident about what they’re selling. And obviously, if you don’t believe it, I’m not going to believe it either. People sabotaging their pitches. I’ve had people come up to me and start their pitches with, “Well, it’s not that interesting, but…”
CAROL: So if it’s not that interesting, why are you spending your time on it, and why are you wasting my time on it, more importantly?
CAROL: And so people do all of these things to sabotage themselves, or to apologize, or take the focus off of them and what it is that they’re trying to get across. So that’s a major issue.
And I think the other major issue is that people don’t spend enough time thinking about who am I speaking with. It always comes back to everyone’s favorite radio station. Everyone’s turned into WIIFM, which is what’s in it for me. And that’s all anybody ever cares about. They care about their perspective, their constituents, their viewership, their readership, whoever is behind them.
And far too many people when they pitch, they treat it almost like a press release. So they’re like giving the, “And here’s what I’m doing. And here’s why it’s so great for me.”
INTERVIEWER: Uh huh.
CAROL: Which gives you as the person who’s listening no opportunity to figure out why it’s helpful and why you should care. So that’s just another really key thing to hone in on is make sure that the person who is — that you’re pitching to is the one whose shoes you’ve put yourself into, and that you’re really telling them why this is going to help them. Because if there isn’t something that’s in it for them, it’s a nice story for a cocktail party, but they’re really not going to care much about it.
INTERVIEWER: Right. Why should I invest?
INTERVIEWER: Absolutely. So what are some secrets to the in-person pitch?
CAROL: So we kind of danced around some of it. But when you get to be in person, you want to have a really strong delivery. You want to have great content. And you also want to have the right form.
And you know, we talked about having that confidence and also that authenticity so that you’re not in pitch voice, that you have that passion that you’re communicating. I always say that if you’re going to bet on a race, that you first bet on the driver and then on the car. And the same thing goes if you’re a customer, if you’re a team member, if you’re an investor. That you’re looking to that person to say “Can you execute?” So if you’re not engendering that confidence and that passion, people aren’t going to think that you’re the one to get the job done. And it’s just a tremendous missed opportunity.
From a content standpoint, one of the things that’s very effective to take your pitch to the next level is to overcome objections. So if you have practiced your pitch enough and you know your business model, you know that one thing that’s a sticking point for everybody. So address that up front. “I know you’re probably thinking that pigs can’t fly. But since we have a drone that carries the pigs, you can just not worry about that at all and we can get on to the rest of my pitch.”
And so if you discredit whatever it is that’s the issue, then they’re not spending the whole pitch thinking about, well, here’s why it won’t work; here’s why it won’t work. They’re like, okay, now I can actually listen to the rest of what you’re talking about.
And then I also like for people to use tangible numbers and examples to create context. So when I introduce myself, I often tell people that I’ve done $2-plus billion worth of deals, that I’ve written a New York Times bestselling book and the name of it. On TV, that I’m on “America’s Greatest Makers” on TBS. And I do this to create context. Because I could say I’ve raised a lot of capital, I’ve written a book, I’m on television. But without those specific data points, it doesn’t lend as much credibility to what you’ve done.
So even if the numbers aren’t something that you think are thousands or millions, if you’ve helped people achieve 30 percent ROI in their business, if you’ve done 100 deployments in a certain industry, if you’ve been quoted in a dozen of the leading tech journals, and perhaps the name of one of those as well, it just creates that extra credibility and people will give you more credit for it.
And then from a form standpoint, I think especially for technology partners, one of the things that you can do is to lose the jargon.
INTERVIEWER: That’s a big one.
CAROL: You know that you live in a cloud-first, mobile-first world. Your customers do as well, but they’re just not aware of it. So if you’re talking to the head of IT, you may want to have a more jargon-filled conversation. But if the CEO’s involved, and he or she is the one making the decision, you have to lose that. You have to be able to explain what you’re talking about so that either a five-year-old can understand it or a non-native speaker of your language can understand it.
And if you can really cull that down, that’s going to give your pitch a lot more legs.
INTERVIEWER: Right. We talk about that a lot about how nowadays, it needs to be about solving a business problem, not just the neatest technology.
CAROL: I say this all of the time. So this is the biggest issue. And especially, our partners are entrepreneurs and small business owners. Many of them are servicing small business owners. And especially for the business owners who aren’t in the tech field, but even for the ones that are, they don’t think about technology unless there’s a tech pain point. Something’s broken, something’s not working and they need to fix it.
So you need to approach things from what it is they are thinking about. Things like how am I growing my business, how am I getting more customers, how am I saving time, how am I making this particular process easier. Those are the things that they’re thinking about on a day to day basis. So if you can come up with their business — a solution to their business problem and technology is the answer, you’re going to get a lot further with them —
CAROL: — than trying to sell them a technology solution.
INTERVIEWER: But start with the problem and the solution, right?
INTERVIEWER: Got it. Okay. So you’ve said that you’ve worked with a lot of small businesses as clients. How do you get them to embrace technology?
CAROL: And so you know, this is exactly what we just talked about is that — that small business owners embrace technology when there’s a very clear path to knowing what’s next for them and how it impacts their business.
There’s a great story that I tell about a Microsoft partner that worked with a bridal salon in Dallas, Texas. And the bridal salon had all of these problems. They had too many brides who were coming in at the same time that brides were exiting at the top of the hour. And they were getting this bridal bottleneck, which as you can imagine, sounds like a totally awful thing —
INTERVIEWER: It’s not good.
CAROL: — that you never want to be in the middle of.
They were having some revenue leakage problems because what would happen is that somebody would try on a dress and fall in love with it, and go, “Oh, it’s amazing. This is the dress I’ve been waiting for. I love it so much.” And then the sales associate said, “Great, meet me up front and we’ll check out.” And by the time they take off the dress, and mom looks at the price and they talk about it and go, “Well, do you really love it? Maybe it’s not great.”
By the time they get to the front of the door, they’ve changed their mind and they’re going to think about it. And you’ve just let a sale walk out the door. And then brides apparently change their minds on things and then blame the place where they bought it.
INTERVIEWER: Oh, no.
CAROL: So maybe they’ve forgot that they ordered lace and they didn’t want lace, or maybe they had a couple Twinkies in between the time they tried the dress on. And then it’s always the bridal salon’s fault.
So they’re grappling with these problems. And so they talked to their Microsoft partner, and the Microsoft partner was actually able to come up with technology solutions to all of them. What they did was put Surface Pro tablets with payment capabilities in the dressing room, so that the brides not only checked out there so you didn’t have the bottleneck at the front, but they sign on the dotted line the second that they love the dress. So then they committed to it and didn’t have the time to change their mind.
And then the tablets actually were able to take the pictures of the bride, store that data in the cloud, have the bride sign off on it so that when they came back, they just download the information from the cloud and said, “So before we try on the dress, this is what you agreed to. Are we on the same page? Yes.”
CAROL: And then if there’s a problem, then it’s your problem. How can we fix your problem, not okay, it’s our problem.
CAROL: So that’s a great example. You would never think a bridal salon as this like amazing outlet to have technology fix all your problems, but it was. And this partner was just so clever in the way that he approached all of them. And there was a technology solution to every one of those problems.
INTERVIEWER: That’s great.
INTERVIEWER: That’s really smart. So let’s talk a little bit about generating customer loyalty.
INTERVIEWER: So why is customer loyalty an important part of marketing?
CAROL: So it’s actually I think the most important part of marketing today because people are so overwhelmed by messages that social media and all these different outlets have basically bifurcated everybody — fragmented them, if you will —
CAROL: — in these different places. So it’s hard to reach at scale any one person. And if you do reach people at scale, it’s hard to really engage them and get their attention.
INTERVIEWER: Right. Uh huh.
CAROL: At the same time as you have this issue, you have this great opportunity because people who already love doing business with you already love doing business with you. And if you have a loyal customer, it’s much easier to get them to purchase more frequently, or to upsell to them or to use them as a conduit to tell other people who happen to look at lot like them, because go figure, whether you’re B2C or B2B, people tend to hang out with people who are a lot like them.
So by focusing on building loyalty, you can actually use your existing customers who you’re in this dialogue with as that leverage point to be able to grow your business both directly and indirectly by getting them to get other people into your business.
INTERVIEWER: And does that building loyalty, does that start right at the — does that start at the pitch and continue through the entire customer relationship?
CAROL: Well, it does. It does. Because if you think about like where we — we started with customer loyalty, we started with like buy one, get — buy nine, get the tenth free or one point per dollar. And I always say that that looks a lot more like bribery than loyalty. So first of all, it’s just a discount. So if people get — buy nine licenses and get the tenth free, somebody else could say well, buy seven and get the eighth free, and then all of a sudden you’re in this weird price war that somebody has to work really hard to get.
CAROL: But then you also have the issues of people becoming very loyal to the program instead of to what you’re providing. And so people get very hung up in the specifics of the program. There’s a major coffee chain that I won’t name by name, but I think everyone can figure it out right now who’s going through this problem that they brought out a loyalty program that they didn’t really need. They did it, I’m sure, to capture data, but they didn’t really need it for loyalty. And then they changed it.
CAROL: And then everyone got really mad that they changed it. And they didn’t even need to do it to begin with because everyone was so focused on how does this program work for me.
So instead of being — creating loyalty to their brand, they were creating loyalty to the program, which never really works.
And then when you do something like that, you create an incentive for people who spend a lot of money. But just as valuable are the people who have what I call big mouths. So spenders, yes. But what about the senders.
CAROL: And the senders are really valuable because the people who are those connectors will go out and tell a bunch of other people about you could account for much more business than maybe that one client. And if you’re just rewarding that spend, you’re not capturing those people who have that conduit to give you the referrals.
So it really is — I mean, it’s very simple. It’s about relationships. The challenging part comes in that everybody’s driven by something different that creates loyalty. So I actually go through sort of a five pillars of loyalty and say that there are different things that drive different people. And I think it helps to contextualize, so that you know which levers to pull.
So some people are driven by products and services. They want the best of breed product and service. If you do a lot of spreadsheet work and modeling, you know Microsoft Excel is best of breed. Office is best of breed. You’re not going to get a free spreadsheet program. It’s just not going to work.
So far partners, I always say that they can do things like layer in their own intellectual property, or proprietary processes, as a way to take best of breed product to the next level.
Some people are motivated by great customer service. So if you think about Nordstrom where you get the myth about the guy who returned the tire and they took it back. You know, if you have a legend about how good your customer service is, you’ve got pretty great customer service.
And so for people who are moved to loyalty by great customer service, that should be an easy one for you to maneuver. You can do anything from being mobile or having off hours to accommodate your clients’ work schedule, to doing something — finding out that they love donuts and bringing donuts every time that you show up. For me, that would actually create a ton of loyalty.
So, for some people, that’s what’s going to move them. Some people are motivated by affinity groups or community. I always use Harley Davidson as a great example. Harley Davidson does not make the best bikes out there, but people ride Harleys because they want to be a Harley rider, and they’re riding their hog down the highway. And they nod to the people. And yeah, living that lifestyle.
So even if you’re a partner, you’re like going, “How do I do that?” You have all of these businesses who could benefit from potentially each other or something else that you bring to the table by being community. So maybe if you’re in a vertical — let’s say you have healthcare as a vertical. You’ve got all these great doctors. Host a mastermind once a year. Bring them all together. Maybe even bring in somebody who’s a big influencer in that area. And then all of a sudden, from being your client, they get access to kind of this exclusive community that they wouldn’t have access to otherwise.
So that’s a huge lever, especially because people create connections and friendships with you in the middle. That strengthens their loyalty.
CAROL: So the last two are experiences. I use Trader Joe’s as an example of somebody who’s taken grocery shopping and taken it to the next level by just providing an experience that they actually talk about their favorite products, and everything’s very easy to navigate. And they walk you places. So you know, create an amazing experience for your customers.
And finally is the bridge. And if you don’t have any of those things, or possibly if you’re just looking for something else, find a way to tie what you’re doing to the things that your customers care about. Campbell’s Soup does this flawlessly. They don’t have that amazing best of breed product. They don’t have amazing customer service. They don’t have any sort of fan club for soup. You don’t have a great experience when you open the can.
But they do things like time saving recipes for moms. They deliver content that’s meaningful to their target audience, and that bridges their product to the audience.
So you can use those five pillars: The product service, the customer service, the community affinity group, the experiences and the bridge by spending time getting to know your customers, figuring out which ones are going to work for them, and then leveraging that.
INTERVIEWER: So what would be your top three things that you want partners to walk away from this podcast knowing or going to do?
CAROL: So I think for partners, the number one thing that you should definitely do is like we said, when you’re talking to your business clients or potential clients and customers, is to really think about what are the pain points in their business. That you are no longer a technologist, but you are a business consultant who uses technology as part of your tools to fix their problems. And I think if you shift your mindset that way and really focus on understanding their business solutions, you are going to be an indispensable resource for them.
I think from a customer loyalty standpoint, to make sure that you really focus on creating these amazing experiences for your existing customers and creating a very rigid system to help them allow to spread the word to people who are a lot like you. So not just, oh, well, would you mind giving me a referral. But create a process that if they love working with you, that they can refer to you and maybe think about more problems that you can solve for them.
And then from a pitching standpoint, the number one thing is just remember you’re not trying to close that deal. That you’re trying to create a relationship, and that these things take time. And if they know you, they like you, they trust you, they’re going to want to do business with you, and then you’ve got to rely on the customer loyalty and everything we’ve talked about gets to be very symbiotic.
INTERVIEWER: Makes total sense.
INTERVIEWER: I really like that idea of thinking of yourself as a business advisor, rather than simply a technology provider.
INTERVIEWER: I think that’s a really big shift in mindset, but a really important one.
CAROL: It’s huge.
INTERVIEWER: And it really sort of puts your customer at the center of all your decision making.
CAROL: Which is exactly where they want to be. Go figure. Go figure. That’s exactly where they want to be. And so if you want to be successful, you shine the light on them.
INTERVIEWER: Absolutely. So do you have any last words for our partner community?
CAROL: I would just say that sometimes when you are in the weeds and you’re trying to build your own business, you forget to step back and look at the bigger picture. And I think the big picture here is that as a partner, you are enabling this tremendous — I know Satya used the word “disruption”. But really, the ability for businesses small on up to grow their businesses, go to the next level, employ more people, impact the economy, impact the world.
And so really understand how important what you’re doing is. I’ll leave it with that.
INTERVIEWER: Perfect. Well, thank you so much for your time. I really appreciate it.
CAROL: Thank you.
INTERVIEWER: This was some wonderful information I think our partners are going to find really valuable.
CAROL: Thank you.
INTERVIEWER: So if partners are interested in talking with you further, how can they get ahold of you?
CAROL: I am one of the easiest people to find online. If you type in Carol, C-A-R-O-L Roth R-O-T-H, you will find more information than you ever wanted to know, but also website carolroth.com, and Twitter, caroljsroth. Also LinkedIn. Really anywhere online. Or on an airplane. You can also find me in various airports throughout the country and the world.
[VOICEOVER]: Check out the other podcast episodes in this series to learn more from Microsoft Partner Network thought leaders. Keep in touch with us via LinkedIn, Facebook, and YouTube by searching for the Microsoft Partner Network, and be sure to follow us on Twitter @mspartner. And if you like the podcast, don’t forget to rate and review it.