Four years ago my coauthor Brent Adamson and I set out the principles of making “The Challenger Sale” in what became a best-selling book of the same name. The principles in this book stood in sharp contrast to the relationship-building model that was dominant in corporate B2B sales at the time. While the concept of “challenging” customers certainly made a splash upon its publication, it wasn’t long until we noticed that we had struck a chord with sales leaders across the world, and we were soon bringing the Challenger model to sales reps in diverse industries and at companies of all sizes.
To provide some context: what our research found is that all salespeople fall into one of five statistically derived profiles, characterized by a specific set of skills and behaviors that defines their primary mode of interacting with customers. These profiles include:
Our research also found that one of these profiles performs dramatically better than the rest while one consistently comes in dead last. And here’s the kicker: the one that comes in last just happens to be the profile that most heads of sales are betting their entire strategy on. When we look at sales performance, the clear winner among these five profiles is the Challenger. CEB research revealed that Challenger reps dominate the high-performer population, making up close to 40% of star reps in our study.
Now, one of the most gratifying experiences in starting this conversation with salespeople and their managers across the world is the input we have received which allows us to continue to perfect the model and maintain its relevance for specific industries. I’ll share one such example of that input below, which goes some way in clarifying what we mean by challengers and relationship builders, two terms that can generate confusion without the appropriate context.
As you can imagine, we often encounter a strong amount of resistance when we tell bank sales managers “relationship selling is dead.” After all, business banking has referred to salespeople as “relationship mangers” for years. Needless to say, these terms can rub those who have reflexively doubled-down on client service the wrong way. That is to say nothing of those who have built their entire brand around relationships, as we often see with community banks and credit unions.
Some clarification is in order.
One key component of challenging customers is asserting control over the conversation. But that language of “challenging” and “being assertive” is often misunderstood and resisted upon first reading. The fear is if we tell our relationship managers to act like “challengers,” they’ll act like Leonardo DiCaprio’s motley crew in The Wolf of Wall Street; if we tell them to be assertive, they’ll just as likely be aggressive.
The Anxiety of Freedom
Of course, challenging a customer doesn’t mean talking down to them—it means challenging them to make the best decision. It means teaching them something new about their business or financial situation. It often means providing more complex and time-consuming advice than simply recommending an off the shelf product. And importantly, in a world where financial services products are seen as largely commoditized, it means convincing customers to pay a premium for the unique value you provide.
And what about relationships? It’s difficult for many in the industry who have grown up with the relationship-building model, to accept that relationship mangers who prioritize relationships as their means of selling were the worst performers. At banks where personal relationships have been the primary basis for sales (and its brand) for years, this finding is sure to be upsetting at first glance.
Of course, these do still matter—it’s only that building personal relationships can no longer be your primary mode of interaction.
It’s easy to see how that message can be misinterpreted, and further proves the point that the language matters.
So as a first step for those willing to explore how utilizing Challenger principles could work for their own bank relationship managers, how do you tell them to be Challengers without sending the wrong message?
One CEB member in the health care industry shared a great (and somewhat ironic) analogy that gets the point across perfectly. As he put it:
The Relationship Builder is like a Bartender. A bartender stands in as your friend, listens to your problems, commiserates over the eternal futility of your favorite sports team, but at the end of the day he’s just there to sell you another drink, with as little hassle as possible. And the next morning, you’re hurting for it.
The Challenger, on the other hand, is like a Personal Trainer. A personal trainer urges you on, “Don’t stop—give me one more!” Similarly, a Challenger isn’t afraid to advise customers when they are making a less than optimal decision, and can apply appropriate pressure on the customer to make the right one. The relationship element doesn’t go away, but it’s a relationship of pushing you to be better, not being a pal.
And at the end of the day, a conversation with a Relationship Builder is probably professional, even enjoyable, but it isn’t as effective because it doesn’t ultimately help customers make progress against their goals. In today’s world—where customers can learn on their own—the Challenger wins by bringing new insights to the table, new ideas to make money and save money that customers couldn’t learn on their own.
Matt Dixon, a managing director of strategic research at Corporate Executive Board, has an unrelenting drive to find the answers to questions senior executives often take for granted. For more than 15 years, Matt has worked to uncover truths behind many pillars of conventional wisdom that is costing companies dearly in terms of wasted money and lost market opportunity.