Sales 101: How Not to Win Customers

If you’re a sales professional, or you’re the CEO of your own tech startup (i.e. a defacto sales professional), you’ll need to learn how to rally clients to your offering and turn them into long term fans. Most of the methods employed by sales and marketing wunderkinds stem from one basic idea. Simply put, you figure out what clients want, and then position your product or service around that. In other words, your job is to to focus on what they want if you want them to care enough to listen to you. There are some great books which will show you what to do, but also learning what not to do is also constructive beyond the schadenfreude value (I’m full of German references today). One of the best examples of what not to do comes to us from recording label fan boy extraordinaire Jermaine Dupree. His pedantic rant here on the Huffington Post is worth dissecting and learning from. On the surface, it is a blog post defending musician Jay-Z’s decision to withhold track singles and sell only full albums on iTunes. In reality, it is DuPree’s attempt to justify his own profits off a dying old media model while disguising it as a plea for artists and consumers. It’s also an awesome example of unintentional comedy.

Here are two particularly funny excerpts along with takeaways we can all draw from them.

“Jay[Z] made everyone realize that iTunes taking what we give them and doing what they want with it isn’t the way it has to be. He put the light on and made other people realize, “Oh these guys are just selling our music, they ain’t making it.” If anything, WE made iTunes.

Let’s put aside the poor grammar for a moment – the clincher is the last sentence. What makes iTunes a success is not Dupree and his apostles, but rather the customers. Music buyers are increasingly choosing digital music over CDs and the Wall St Journal reports the statistics bear the trend out. The retailers get it –they’re quietly reducing floor space allotted to music. Hence artists like Jay-Z will be completing for ever-shrinking floorspace while David Bowie and Trent Reznor who embrace the web will increase their visibility where it counts. The takeaway: Losing customer-centric focus will turn you into an anachronism, leaving you struggling for a bigger slice of a shrinking pie to grow your revenues.

“But Universal sells one out of every three records. All it’ll take is for Warner Music to say, “You know what, I’m with you,” for us to shut ’em down. No more iPods! They won’t have nothin’ to play on their players! We can take back the power if we’re willing to sacrifice some sales to make our point.”

DuPree’s shockingly bad understanding of how ipods work is not the showstopper here, nor is his grade school logic. What’s hilarious is that he obliviously advocates violating U.S. Antitrust laws. His statements are even more puzzling in light of lawsuits filed against recording labels in both California and New York for price fixing. Besides, as a customer, I derive zero value from the music labels holding back choices. It makes me more risk averse, so I still may not buy the album, and now I won’t buy the single either. The takeaway: Mitigating competition by offering a better product is an amazingly effective way to maximize profits. Mitigating competition by colluding to limit their choices is an amazingly effective way to maximize class action lawsuits.

DuPree’s defense of his seizing the majority of profits from a record sale is a funny indication of the old media’s disdain for customers, and a good cautionary tale for sales and marketing professionals. Is it any wonder music consumers (particularly younger ones) and even artists are largely ambivalent about sharing music files?

This entry was published on November 26, 2007 at 8:57 PM. It’s filed under Uncategorized and tagged , . Bookmark the permalink. Follow any comments here with the RSS feed for this post.

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