Why you shouldn't drink before a sales meeting

Published: Wed, 04/03/24

April 3, 2024

TOGETHER WITH

Good morning. It’s a brand new quarter and a brand new season, so pick yourself up, dust off those jorts, and get ready for three months of trying to lose those winter pounds while listening to increasingly elaborate excuses from your prospects! For now, forget about all that with a crisp new issue of The Quota. Let’s dig in.

NUMBER OF THE WEEK

6.6

Typical inside sales reps have 6.6 conversations per day.

Source: ForEntrepreneurs and The Bridge Group

SALES ROUNDUP

Here’s what’s happening in the sales world this week:

A Chicago-area woman has been arrested and charged with the murder of a Rockford car salesman. Prosecutors say Rosie Chavez, along with two accomplices, took the salesman for a test drive. His body was found hours later — he had been shot in the head and back. No motive has been released. You can read more about it here.
In a proposed lawsuit, three Dick’s Sporting Goods employees claim that the retailer has wrongfully withheld commissions earned by them and other salespeople within the golf department of its Pro+ stores. In a proposed lawsuit, they say that Dick’s implemented its “premium equipment commission program” in 2021 but never informed them or other salespeople about the program and has failed to pay the commissions. You can read more about it here.

FEATURE

Image: ArDanMe/shutterstock.com

How Hermes uses the sales tactic of exclusivity to keep sales and prices high

In the fiercely competitive world of luxury retail, few strategies are as effective or as intriguing as the use of exclusivity to drive demand and maintain high price points. And among luxury brands, Hermès stands out for its masterful execution of this tactic, particularly with its legendary Birkin bag.

The Birkin bag, a symbol of ultimate luxury and exclusivity, serves as a prime example of Hermès's strategic use of scarcity. Introduced in 1984 and named after actress and singer Jane Birkin, the creation of each bag involves 18 to 20 hours of craftsmanship by a single artisan. This meticulous process, combined with the brand's silence on production numbers, creates an aura of rarity around the product. With retail prices starting upwards of $10,000 and vintage pieces fetching up to $450,000 at auction, the demand for Birkins far outstrips supply, a fact Hermès has turned to its advantage.

Vogue magazine has described obtaining a Birkin as a "daunting" task, noting the absence of waiting lists and the long, uncertain wait potential buyers face. This difficulty is not a flaw but a feature of Hermès's sales strategy, making the acquisition of a Birkin not just a purchase but a quest, enhancing the bag's allure and desirability.

Further complicating this quest is the sales practice known as "tying," wherein the opportunity to buy a Birkin or its sister bag, the Kelly, is predicated on the purchase of other Hermès products. Buyers may be required to spend thousands on what the company deems "ancillary products" before being considered worthy of a Birkin. This tactic not only boosts sales across Hermès's product lines but also reinforces the notion that owning a Birkin is a privilege reserved for the brand's most loyal customers.

This approach, however, has not been without controversy. A class action lawsuit filed against Hermès accuses the brand of unfairly withholding Birkins from all but the highest-spending customers, an alleged violation of antitrust law. The lawsuit underscores the delicate balance luxury brands must strike between cultivating exclusivity and avoiding practices perceived as unfair or exclusionary.

Despite these challenges, the allure of exclusivity remains undiminished. As Douglas Hand, a lawyer specializing in fashion, points out, luxury goods like the Birkin offer consumers not just a product but access to a level of class and exclusivity. This appeal is not limited to Hermès; it is a principle that underpins the luxury sales industry at large, from Rolex watches to Porsche 911s.

The Birkin saga illustrates a fundamental truth about selling luxury products: scarcity, whether real or manufactured, can significantly enhance a product's desirability and value. For sales professionals, the key takeaway is the power of exclusivity as a sales strategy. By carefully managing supply, creating an aura of selectiveness, and ensuring that products are perceived as worth their price, brands can maintain high prices and fervent demand. In the end, it's not just about selling a product; it's about selling an experience, a status, and a dream.

INTERACTIVE PRODUCT DEMOS ARE THE FUTURE OF SALES

Why do companies like Gong, Clari, and Cognism all use Storylane?

Today’s buyers expect to do their own research, try out the product, and see it in action for themselves. They crave demo environments where they can get hands-on with the product.

And that's where Storylane comes in!

Storylane lets sales teams create interactive product demos (guided or cloned) to tell the story of their product and help prospects reach their “aha moment” quicker. The demos are customizable, scalable, and can be updated even with frequent product changes—no coding required.

Over 1,000 industry leaders use Storylane to educate buyers and close deals faster, with a 35% increase in pipeline observed, on average.

If you’re a sales rep or leader looking to impress prospects, shorten sales cycles, and close more deals, you gotta try Storylane!

Create your first interactive demo today for free (less than 10 mins setup)!

Try for free

MEME OF THE WEEK

Source: Instagram -- Sales Humor

QUIZ

How many boxes of Girl Scout cookies are sold each year?

A. 200 million
B. 88 million
C. 4 billion
D. 144 million

SALES FAILS

Each week, we bring you the most cringe-worthy sales moments from across the web. To submit your sales fail story for consideration, click here. (Don't worry, you'll remain completely anonymous).

Years ago, I was a rep/account manager for an app development company. We built apps for businesses and entrepreneurs, nothing below $50k. This was around the time that apps really started taking off, so we were staying busy and making great money.

I got introduced to a prospect company through somebody I had previously worked with. They were a web startup that was going to expand into a physical product that worked in conjunction with an app, and they were looking to hire our company to develop the web and mobile technology. It was potentially a massive deal, and we were working hard to try to win the business.

The company was based in Chicago, so we had planned to go out there and do our presentation in person. I went along with my manager, one of the company owners, and two other people who worked with us. We got a nice hotel the night before and had dinner and were all having a good time.

One of the people at the company we were pitching knew we were in town and invited us out for drinks. He was a manager there and met up with us along with a few of his friends who didn’t work for the company. The night started to get crazier and crazier as we went from nightclub to nightclub. At some point, the people from my company went back to the hotel, but I decided to stay out.

I drank a ton, and honestly don’t remember much of the night. What I do remember is waking up the next morning at a random apartment in Chicago at 10 am with over thirty missed calls and texts and emails from my team. The pitch meeting was supposed to start at 10, so I was already late. I hurried to the company’s office still wearing the clothes from the night before and looking like death. By the time I got there, they were already mostly done presenting and I just sat in the corner with my mouth shut feeling like a complete idiot.

My company won the deal, and they paid me my commission, but I was never again invited on any company business trips. My saving grace was that the deal closed, but if it hadn’t, I’m 95% sure I would have gotten fired. I definitely don’t drink like that anymore now that I’m older.

Anonymous Location withheld

GRAPH OF THE WEEK

Source: LinkedIn Poll -- March 2024

WORTH A PEEK

What’s the craziest thing you’ve ever done to close a deal? Nutshell recently published a fun article with eight crazy stories of reps and leaders going above and beyond to make a sale. Check it out here.

ASK THE QUOTA

Want to submit a question and be featured in our advice column? Click here. (Don't worry, you'll remain completely anonymous).

Dear Quota Team

I sell medical equipment for a small-ish regional business. I’ve always been one of the top reps. The job is great and I’ve been able to earn some serious dough. Well, I’ve been working on a deal for the last few months. We’re almost at the finish line and I’m 90% certain it’s going to close. I’ve been keeping my manager up to date on the deal throughout the process and he’s been keeping the CEO informed. I stand to make just under six figures in commission from this one deal — my biggest single paycheck ever.

I got an email from my manager last week (with the CEO cc’d) that said they’re changing company policy and putting a cap on commissions for all reps. This deal will put me over the new limit and my commission on this deal will be cut by almost 30% because of the new cap.

What should I do? I haven’t responded yet as I’ve been weighing my options. They’re being greedy and it feels like they’re just adding this new cap to keep more money for themselves.

Furious in the Northeast

Dear Furious,

It’s likely that by the time you read this, you will have already had the conversation. This is worth fighting for, and it would be incredibly unfair for them to change the comp plan retroactively just as you’re getting a deal over the finish line.

The best way to make your case is to leave emotion out of it, as difficult as that might be. Explain your perspective and do it without threats or accusations. Depending on the response, you will have a decision to make.

If they agree with you and pay the commission, then your problem will be (mostly) resolved. If not, then you need to decide whether this is worth a legal fight. As you’ve seen in this newsletter, commission disputes sometimes end up in court, and quite often, the plaintiff wins. But you’ll need to decide whether you want to devote the time, money and energy into the fight, or if it’s better to just cut your losses and work somewhere less dishonest. Good luck!

Quiz Answer: A. 200 million boxes of Girl Scout cookies are sold each year — (you can read the source article here)

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Today's email was written by Ken Kupchik, Erica Furgiuele, Steve Rado, and Emily Hill.

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