Selling Services On the Phone – The Differences

With services accounting for almost 80% of the U.S. economy, many business-to-businesses organizations offer and sell services, whether they are offered as a cross-sell with a product or as a stand-alone business. Therefore, many telephone salespeople find themselves selling services either in conjunction with products, or as a unique offering. Consider however, that products are manufactured and produced under controlled conditions which reduces variability. For decades, manufacturers have worked to stamp out variability and produce products within tightly managed specifications. Services require the opposite, requiring the interaction of customers and the employees of the service provider, making it difficult to standardize and control variability. For services, the ability to adjust, tailor and customize for the customer is often celebrated.

Services offer a unique challenge then to the telephone salesperson. Services have heterogeneity, which means the output cannot be standardized, and the involvement of each unique customer changes the output. This requires the salesperson to educate the customer and in turn educate the organization about the customer’s unique requirements. Anyone who has ever played a game of telephone, passing along a message from one person to another until it turns into a garbled mess understands the complexity of this. Unlike products, services cannot be inventoried and pulled off the shelf. There is no such thing as an inventory of services as they are uniquely perishable. If your business sells repair services for example, and no one needs a technician on Friday, that time cannot be inventoried until Monday. Therefore, the organization must be able to meet demand as the salesperson sells it, creating tension and friction between the salespeople and those that deliver the service.

The issue of heterogeneity, or non-standardized outputs, causes some organizations to work around these difficulties by using the “propose and deliver” sales model, most commonly found in consulting organizations. With this model, the salesperson sells the engagement and then goes out and delivers the service. The advantage is there are few communication issues between salesperson and service delivery person since they are the same individual. The disadvantage for the selling organization is growth is very difficult and constrained. It takes a unique individual who has the aptitude to sell and deliver a service. Further, because the consultant/salesperson owns the entire customer experience from engagement through delivery, they have little loyalty towards the selling organization. At some point, the consultant/salesperson may feel the cut of the action going to the selling organization is wasted, after all, they are doing all the work. “Propose and deliver” organizations may fly apart due to centrifugal force, as their consultant/salespeople are drawn into their customer’s orbit and think they can do better financially on their own.

Organizations that want the customer experience shared between a telephone salesperson and service delivery group are generally more stable, and more able to adopt growth strategies. The drawback is the need for the salesperson to communicate the service delivery requirements internally. This often leads to computer screens requesting data, meetings called to discuss clients, documentation, and a sales manager who is able and willing to play referee. A drawback too is the natural tendency to narrow the range of service offerings to fit the 80% of the opportunities which results 20% of the business. The Pareto Principle of service delivery.

Into this mix comes the telephone salesperson. Charged with selling a service which is at its nature intangible, can’t be felt, tasted, seen or heard easily, with draconian communication requirements on the backend. To top it off, customers, in all their variety and with differing needs and expectations, must be satisfied. Selling services over the phone is a team effort.