A step-by-step guide to crafting a sales pitch that wins | April Dunford (author of Sales Pitch)

1. 0:00 – 3:46

   April’s background

   1. ADApril Dunford0:00

      40 to 60% of B2B purchase processes end in no decision. You scratch on that data, the majority of those aren't saying, "Well, I'm not making a decision to buy something new 'cause the old thing we were doing is better." That's not true at all. In fact, the majority of those is they couldn't figure out how to make a choice confidently, so what they did was they just went to their boss and said, "You know what? Now is not a good time. L- let's not do it now. Let's do it next year. We'll just, w- we'll just delay it." Because that is the safe, risk-free thing for that person who's on the hook to make the decision to do.

   2. LRLenny Rachitsky0:37

      (instrumental music) Today my guest is April Dunford. April is the world's foremost authority on product positioning. She's the author of the bestselling book Obviously Awesome, which is my favorite book on positioning, and this is her second time on the podcast because she just published a new book called Sales Pitch, which builds on her 25 year career as VP of marketing and advisor for companies like Google and Epic Games and many others. The book guides you through a better way to pitch and sell your product, and in our conversation, April shares the framework that she has seen work most often in getting potential customers to get excited about your product and to decide to buy your product. Like I say at the top of this episode, you will become better at pitching and selling your product by the end of this episode, and if that's useful to you, which it should be, this episode is for you. With that, I bring you April Dunford after a short word from our sponsors. This episode is brought to you by Composer, the AI-powered trading platform now with retirement accounts. Algorithmic trading has historically been reserved for the hedge fund elite. Now, with Composer, you can automate your trading with a library of over 1,000 strategies that are easy to understand and tweak using an AI assistant and visual editor. Composer is the first ever algorithmic trading platform where you don't need any coding experience. It includes a full range of trading indicators for you to get creative, and a Discord community of 2,500 traders to discuss your ideas with. Composer also has a powerful back tester to see the historical performance of your strategies, and you can then invest with a single click. Once you invest, Composer will automatically trade for you based on the logic of your strategy. With $1 billion in trading volume and over one million trades executed, Composer already has many big time investors using the platform regularly. Head to composer.trade and use the code Lenny for an extra week of free trial on your Composer membership. That's composer.trade. This episode is brought to you by Eppo. Eppo is a next generation AB testing platform built by Airbnb alums for modern growth teams. Companies like DraftKings, Zapier, ClickUp, Twitch, and Cameo rely on Eppo to power their experiments. Wherever you work, running experiments is increasingly essential, but there are no commercial tools that integrate with a modern growth team stack. This leads to wasted time building internal tools or trying to run your own experiments through a clunky marketing tool. When I was at Airbnb, one of the things that I loved most about working there was our experimentation platform where I was able to slice and dice data by device type, country, user stage. Eppo does all that and more, delivering results quickly, avoiding annoying prolonged analytic cycles and helping you easily get to the root cause of any issue you discover. Eppo lets you go beyond basic click-through metrics and instead use your North Star metrics like activation, retention, subscription and payments. Eppo supports tests on the front end, on the back end, email marketing, even machine learning claims. Check out Eppo at GetEppo.com. That's GetEppo.com and 10X your experiment velocity.

2. 3:46 – 12:22

   Fixing poor positioning with storytelling at Help Scout

   1. LRLenny Rachitsky3:47

      April, thank you so much for being here. Welcome back to the podcast.

   2. ADApril Dunford3:51

      Oh, it's so great to be back. We were talking about this earlier, but it feels like it was so long ago when I did the last one. Like, I was one of the first guests and I feel like, man, you've been running this thing forever and it's, and that was like a year ago. (laughs)

   3. LRLenny Rachitsky4:05

      It feels like a lifetime, but it was about a year ago.

   4. ADApril Dunford4:08

      But what you've done with it is amazing, right? Like the growth in it and everything else, like it's super inspirational.

   5. LRLenny Rachitsky4:13

      Thanks April. I appreciate that.

   6. ADApril Dunford4:16

      You're welcome.

   7. LRLenny Rachitsky4:16

      (laughs) You-

   8. ADApril Dunford4:16

      It's true though. Like I think everybody looks at your stuff and goes what the heck? How does he do it?

   9. LRLenny Rachitsky4:22

      The secret is a lot of work.

   10. ADApril Dunford4:24

       Yes. (laughs)

   11. LRLenny Rachitsky4:24

       That's the get rich quick scheme there.

   12. ADApril Dunford4:27

       (laughs) Nobody wants to hear that.

   13. LRLenny Rachitsky4:29

       Yeah, yeah. But it's work that's extremely fulfilling and we get to chat again and you're a very rare return guest which makes me very happy. And the reason you're back is you've written an incredible new book which I have right here if you're on YouTube called Sales Pitch.

   14. ADApril Dunford4:44

       Oh, that's so cool.

   15. LRLenny Rachitsky4:45

       There it is, and it's in your background too. It's like a Inception. The book is called Sales Pitch: How to Craft a Story to Stand Out and Win and we're gonna be spending our time today digging into all of the lessons and frameworks in the book as much as we can in the hour that we have, and my goal for this conversation is for listeners to leave this podcast with better skills at pitching and selling their product which I think every product leader and founder will want to do and get better at.

   16. ADApril Dunford5:12

       Yeah.

   17. LRLenny Rachitsky5:12

       How does that sound?

   18. ADApril Dunford5:13

       That sounds great.

   19. LRLenny Rachitsky5:14

       Okay. Sweet. I was thinking as a way to get into the conversation, we start with maybe a story or an example of a company that you worked with where you applied the frameworks and lessons that you teach in the book and then use that as kind of a jumping off point for digging in further.

   20. ADApril Dunford5:30

       Yeah, sure. Eh, so my background is I do positioning work and so, eh, in the work that I do with clients, eh, you know, generally what we're working on is a shift in the positioning which is, eh, you know, a little bit of a shift in our thinking around how do we win in the market. So, in order to test that positioning, what we want to do is take the positioning and translate it into a sales pitch and then test it live with prospects. And one of the things I noticed right at the beginning of doing this work is that everybody's sales pitch kind of looked the same-And they weren't all that great. (laughs) And for the most part, what th- what was happening in the sales pitches, there was no positioning going on in the sales pitch at all. The sales pitch was essentially a product exposition. So, you know, eh, essentially a glorified product walkthrough. Like, if there was five dropdown menus, we're gonna click on all five dropdown menus and show everybody everything, just feature, feature, feature, feature, feature. And so most of the teams weren't used to doing any kind of, like, pitching in the pitch, really. It was just a, you know, just the facts, jacks, we're just gonna show you that. Some would do, like, this really lightweight thing, like, you know, "Here's the problem, where the solution. Now let me walk you through all the dropdown menus." But i- you know, it was basically the same thing like that. And so what I wanted to do was build a pitch structure that would reflect the positioning, and so in order to do that, we, we have to get a little bit into storytelling mode. Not a lot, but at least a little. And when we're talking about features, we shouldn't be talking about features. We'd be sh- we should be talking about the value that the features deliver. So let me give you an example, and I'll do before and after, what this would look like. Um, so I work with these folks, Help Scout, and so they're in the customer service space, so think Zendesk or w- you know, whatever. They're in that space. And what's interesting about them is they were built from the ground up to serve digital businesses-

   21. NANarrator7:18

       Mm-hmm.

   22. ADApril Dunford7:18

       ... so businesses that don't have a physical store, they don't have sales reps, and so i- i- it, it, their approach to customer service was different. Like, right from the outset, Help Scout said, "Well, you know what? Customer service for that kind of business is really important. It's the only time you ever get to interact with actual customers, and so i- you know, the data shows that if you give them a really great interaction and service, it improves loyalty, it improves repeat purchases, and it's actually a growth driver." Now, most folks in other industries see customer service as a cost center. So y- you know, your telephone company, for example, wants to get you off the phone as fast as possible. (laughs) And they wanna push you to the self-serve FAQ channels, and they don't care about giving you a good service at all, 'cause, you know, they, they don't care about any of that. And, and so they're all about driving the cost down. So if we look at Help Scout and their positioning, the alternatives to Help Scout are a handful of things. Like, most folks start using a shared inbox. So i- and it's really easy to use, and the reps love it. It's easy to use. The problem is, is you start growing, and then you wanna do... You want customer service features, like you wanna be able to do assignments and prioritization and things like that. So then these customers end up upgrading to helpdesk software, and now they're in this whole different world, right? So the first thing is really hard to use, so th- you know, the, we're not in shared inbox territory anymore. And the second thing is that y- you know, there's this attitude of, "We're trying to push folks to low-cost channels. We don't really care about them. We're gonna assign you a ticket number." (laughs)

   23. NANarrator8:46

       Mm-hmm.

   24. ADApril Dunford8:46

       "You're not a person anymore." (laughs)

   25. NANarrator8:48

       Mm-hmm.

   26. ADApril Dunford8:48

       All this stuff. So that's the situation. So Help Scout, if they did a typical pitch the way that I see most SaaS companies pitch, they would just expose the features, right? So the pitch would look like this. Th- eh, digital business comes in, and they say, "Hi, we're Help Scout. Let me show you how to log in. Let me show you all the features. Look, there's a shared inbox thing there. That's really great. Oh, look, you know, we can do assignments and prioritization, and we can do this other thing, and we can do this other thing," and la-la-la-la-la-la-la. And I keep going until the time runs out, and I don't have any more features to talk about.

   27. NANarrator9:20

       Mm-hmm.

   28. ADApril Dunford9:20

       The problem with that pitch is the customer's sitting there going, "I don't know, man. Like, that sounds a little bit like my shared inbox. But it also sounds like helpdesk software. Like, is it different than helpdesk software? I'm not so sure. And, like, there's overlap in the features there." And so it doesn't really answer the question, "Why pick us over the other guys?" And so a different style of pitch would be, one, we would do a little bit of setup to give everybody an idea about how we fit amongst all the other solutions and what our point of view is in the market. And then when we get to d- exploring the features, we would do that within the context of the differentiated value. So here's how that pitch would look like. Customer comes in, and Help Scout says, "Hey, digital business. Uh, you know, we work with a lot of companies like you, and I'm gonna show you the product. But before we get there, one of the things we think is interesting is that digital businesses look at customer service differently. They look at it as a growth driver, rather than a cost center. And so you, you know, most of the folks we work with see delivering a really amazing experience as, like, a key part of customer service. Would you agree with that?" "Yeah, we would." You know?

   29. NANarrator10:27

       Mm-hmm.

   30. ADApril Dunford10:27

       They have a little conversation, and then they say, "Great. Well, you have choices here, right?" So most of the folks we work with start with a shared inbox, and that's great, 'cause it's really easy, really easy to use, all that stuff. The problem is, is if you're growing, and you probably are, then you're gonna outgrow that, 'cause you're gonna need prioritizations, assignments, helpdesk stuff. And so then your option is to go to helpdesk software. And so helpdesk software is great. Like, it does all the things. The problem is that it was not designed for businesses like you. It was designed for businesses that wanna take the cost out of customer service. So it's gonna do some things that are weird, right? It's gonna g- assign your customers a ticket number.
3. 12:22 – 14:13

   Pitch components: setup and differentiated value

   1. LRLenny Rachitsky12:22

      Awesome. So just to maybe summarize the framework, 'cause you went through each of these pieces, and I think it might be helpful to give people the kind of steps and, uh, I have them here but maybe it might be better for you to kind of go through.

   2. ADApril Dunford12:33

      Yeah.

   3. LRLenny Rachitsky12:33

      The pieces.

   4. ADApril Dunford12:33

      So you can think of it as, so first of all, the pitch structure has two big pieces. So the first is the setup. The setup piece is not about us, it's about the market and our point of view on the market. The second bit is all about our differentiated values, so why pick us over the other guys. So we, those pieces aren't equal. Like, in a normal sales pitch situation, we don't want to spend all day in this, the setup part. Like, we want to get to the meat, which is our differentiated value. But we can't skip that bit. So if I've got a half hour call or a 45 minute call, maybe I spend a few minutes on this upfront. This upfront stuff is really important though, and we could break the upfront into three pieces. So it starts with our insight into the market. So this is, you can think of this as our point of view on the market, or kind of like the problem inside the problem-

   5. LRLenny Rachitsky13:26

      Mm-hmm.

   6. ADApril Dunford13:26

      ... in some ways. So in Help Scout's case, the insight is, hey, customer service is just different for digital businesses, and th- and this is really a growth driver, not a cost center, so we need to think about customer service in a different way. That's their insight. So we start with that. The second piece is pluses and minuses of alternative solutions. What we want to do is paint a picture of the entire market and talk about what's good and bad of the other ways of approaching the job. And then out of that conversation, we have a conclusion, which is th- what I call perfect world, but just kind of like can we agree that if we really wanted to solve this problem and knowing what, what works and doesn't work and the alternate solutions, can we agree really good solutions should tick these boxes? This is getting the customer aligned with

4. 14:13 – 15:56

   Wrapping up the sales pitch

   1. ADApril Dunford14:13

      your world view. If they're aligned, then we switch to the follow through. The follow through has a handful of steps, but the main step is this differentiated value step. So usually what we'd start with is an introduction. Hey, we're Help Scout. You know, we do customer service stuff, specifically for digital businesses. And then we would move on to here's the value we deliver, here's how we do it. Here's the value we deliver, here's how we do it. Here's the value we deliver, here's how we do it. We generally end the sales pitch with a couple of little steps. So one is after we talk about the value, generally there's a step for proof, which is how can we prove that we do what we say we can do, which is often a customer case study, or it might be independent third party verification on stuff. But usually there's a proof step. There's an optional step after that, which is handling objections that haven't come up during the call. So sometimes we'll have a silent objection like, yeah, that sounds really good but it sounds really hard to adopt-

   2. LRLenny Rachitsky15:08

      Mm-hmm.

   3. ADApril Dunford15:08

      ... or yeah, that sounds really good-

   4. LRLenny Rachitsky15:09

      Mm-hmm.

   5. ADApril Dunford15:09

      ... but it's probably pretty expensive. Or, you know, yeah, that's okay but it probably doesn't meet our needs for security or whatever. And so we handle that at the end in this special objections step.

   6. LRLenny Rachitsky15:20

      Mm-hmm.

   7. ADApril Dunford15:20

      And then we end the pitch with what I call the ask, which is whatever we want the customer to do next. So, you know, it could be just asking for the sale or it could be, hey, we want to do a proof of concept, let's, you know, who do we, who do we need to talk to about that? Or hey, we're gonna do a project, let's, h- who needs to be involved in defining the project? Whatever the next step is in your, um, sales process, that's how we end is with the ask.

   8. LRLenny Rachitsky15:44

      Cool. I wanted to actually talk about objections, 'cause I imagine going through this, companies often don't agree with what you're saying, and I wonder how you handle that. So you're going in this like, "Do you agree?" And yeah,

5. 15:56 – 19:13

   Handling objections effectively

   1. LRLenny Rachitsky15:56

      the silent objection is really interesting. I didn't even think about that where they're just like they're not, they're just like, "Yeah, yeah, yeah, we agree," but they don't-

   2. ADApril Dunford16:00

      Right.

   3. LRLenny Rachitsky16:00

      ... really agree. How would you suggest people handle them being like, "No, I don't actually see the world that way," or the silent objection which I guess is like something you save for the end?

   4. ADApril Dunford16:09

      Typically when we're starting with insight, our insight into the market, if we're doing this well, the insight is generally not all that controversial. So you can think of it this way. So it's- it's kind of the reason you built what you built. So most founders when you talk to them, like they didn't just come up with the idea out of nowhere. They woke up in the morning and said, "You know what sucks about email? This thing sucks about email. And so I'm gonna build this different kind of email that solves that problem." Or in the case of Help Scout, it's like, "Do you know what sucks about customer service? It just wasn't built for these kinds of businesses." And so if you've got a point of view on the world and you're talking to a customer that just fundamentally doesn't agree with that, so like in the case of Help Scout, they come in and they say, "No, actually it's a call center for us, like we're just trying to get the cost down," th- they should disqualify that deal (laughs) because they can't serve that customer better than Zendesk does. Zendesk is gonna win that deal. But if you've done this properly, your insight should resonate for the target account that you're trying to go after. Now, that doesn't mean there aren't gonna be other objections, and usually there's all kinds of other objections, but the objections are more on a level of, you- you know, if I can get you hooked at the beginning in this setup, then we go to the value which is just proving I can do what we already agreed we wanted to get done, then the objections tend to be more like operational stuff, like, "Yeah, this sounds good, but I don't know if we can afford it," or, "This sounds good but boy, we're gonna have to migrate off the old thing," or whatever. So mentally, they're kind of sold already, but they're worried about, "Well, what's IT gonna say?" And you know, "Can I actually get budget about this?" And in B2B, we've got this- this network of people that we've got to go get agreement from to move forward on this thing. And so often there's objections around that. The beginning of the sales pitch thing, i- i- one more thing on that is that...... part of what we're doing in that setup is what salespeople would call discovery. And so, that setup part should not be me talking at you. Like, it should be a conversation between me and the client saying, "Do you agree with this?" Like, "Is this what you're seeing?" Like, "Did you start with a shared inbox? What are you doing right now?" Like, "Did you ever consider using helpdesk software? Why yes, why no? What... Do you have any constraints on what you're looking at? Like, what have you tried before? What are you looking at trying right now?" This is part of the discovery that we do in a first substantive sales call that your sales reps would know how to do this. Typically, one of the things we don't have in, in, in, in the pitch decks that I see in SaaS companies is there's no good place to do this discovery. So it kind of happens outside of the structure of the pitch. In this pitch structure, there's a definite spot for discovery. So by the time we get to the end of the setup, we should either be aligned, like, "Yep, this looks like a good prospect for us. Yep, we can do something. Yep, they got a problem we can solve. This all looks good." Or we kind of jointly come to the conclusion, "Hey, this just... Our stuff just ain't for you, man." (laughs) And that's it.

6. 19:13 – 25:46

   Understanding buyer’s mindset and market perception

   1. ADApril Dunford19:13

   2. LRLenny Rachitsky19:13

      And I, I imagine a lot of this comes from doing this enough times, you get to understand how o- like, where people generally agree. Like, this is a problem. We all know this is a problem.

   3. ADApril Dunford19:21

      Right.

   4. LRLenny Rachitsky19:22

      And it's unlikely that you're gonna, it's gonna, you're gonna have to throw everything out because someone just decides, "No, this isn't for us."

   5. ADApril Dunford19:28

      Yeah.

   6. LRLenny Rachitsky19:29

      I think one of the biggest shift maybe from this framework is that you go into like a teaching mindset.

   7. ADApril Dunford19:34

      Right.

   8. LRLenny Rachitsky19:34

      It's not just like, "Here's our product. It's gonna solve your problem." It's more, "Here's what's happening broadly. You, maybe you don't have the time to do the research we've done. Here's what we found." And then that builds trust, I think in you as a company and as a leader, a salesperson. And then they're like, "Okay, so they, they see the world the way we do," or "I've just, like, realized something new. I never thought of it that way." And then, "Okay, cool. How do they think about the solution to this?"

   9. ADApril Dunford19:57

      Right. Like, one of the key things to think about in all of this stuff that I, I think we don't think about enough as software vendors is that, you know, customers will come to us and they've done their homework, right? They've, they've Googled around and they've looked at stuff. But that doesn't mean they have perfect understanding of the market. In fact, it's usually far from it. If we think about it, most of the folks in B2B software, most of the time, your buyer has never purchased software like yours before. This is the first time they've done it. And their boss has come to them and said, "Hey, figure this out. Like, go find us a CRM and go, you know, look at all the CRMs and figure it out." And, and the buyer is looking at it going, "Well, geez, I don't know, man. Like, there's a lot of CRMs out there. And I'm looking at all the things. I'm on G2 Crowd and there's 24 CRMs in the top right corner, and I'm looking at Gartner Group and I'm looking at this thing и I am actually doing my research, but I'm overwhelmed." What I don't have is a clear picture of the market. Like, what are the different approaches to this problem? Like, forget about products. Like, what are the approaches to the problem? Where do the products fit in those approaches? What's a good solution for me look like? What should be my purchase criteria? Like, that's really hard for buyers to figure out. And in general, in a sales process, we're not doing anything to help the buyer figure that out. Even though we know it. We eat, sleep, and breathe this market. We spend all day looking at competitors and thinking about this stuff and whatever. But we've got this idea, "Well, we shouldn't do this because, you know, first of all, we can't talk about the other guys 'cause that, we'd be seen as bashing our competition and that's bad," right? The other thing is, even if we did give our opinion, nobody would trust us because we're biased. But if you look at the research on this stuff, the research doesn't support that. Like, the, the research actually says what B2B software buyers want in a sales interaction is perspectives on the market and help weighing their options. And we don't do that. We're just like, "Here's our stuff. You figure it out. It's up to you. You figure it out" (laughs) . And so as a result, what we get are these buyers come in, they're overwhelmed with all this information, they come in and they, they sit in our sales process and we overwhelm them even more with more features and more information. And what they're really worried about is, "What if I make a bad choice here? 'Cause I've never done this before and I'm gonna have to recommend to my boss. And if I make the wrong suggestion to my boss, maybe my boss thinks I'm stupid or maybe I buy something and the whole department hates me 'cause it's awful to use. Or maybe I pick something and it's just bad software and then bad things happen for the business. Maybe I get fired." And so the data on this shows that for B2B, 40 to 60% of B2B purchase processes end in no decision. And then when you look at s- If you scratch on that data, the majority of those aren't saying, "Well, I'm not making a decision to buy something new 'cause the old thing we were doing is better." That's not true at all. In fact, the majority of those is they couldn't figure out how to make a choice confidently. So what they did was they just went to their boss and said, "You know what? Now's not a good time. L- Let's not do it now. Let's do it next year. We'll just, w- we'll just delay it." Because that is the safe, risk-free thing for that person who's on the hook to make the decision to do.

   10. LRLenny Rachitsky23:23

       I think this is one of the most interesting insights that you share in your book and you also share this in the newsletter post about how buying software is, you could argue, is harder than selling it because people who have learned their skills and training for selling but buying is this-

   11. ADApril Dunford23:37

       Yeah.

   12. LRLenny Rachitsky23:38

       ... as, as you described, extremely stressful. Like, basically your job is on the line if you make a mistake. Is there anything more you can share along those lines just like to help reinforce that buying software is extremely hard and stressful and people don't u- understand that?

   13. ADApril Dunford23:49

       Once you sort of get into that mindset, I, I think then you look at the situation a lot different. Like, I think we've seen the statistics on this that says, you know, the buyer is 80% of the way through their buying journey by the time they talk to your sales rep. Y- Yeah, maybe. But they might be 80% of the way to saying, "Nope, I'm not buying nothing." And in fact that's true 60% of the time. And so, how do we combat that? Like, the way we combat that is not just talking about ourselves. It's actually about trying to be helpful-... To that person in this very stressful situation that is trying to figure out, "How do I make a really good decision?" So what we should be doing is giving them a way to think about the whole market. And say, "Look," like, you know, ah, li- in the case of Help Scout, "Look, there's, there's shared inbox, and then there's help desk software, and then there's us. And, and, and I don't care who the vendor is, I'm gonna put them in one of those buckets." (laughs) And so you can just think of it that ways. You don't need to know every single feature, every single thing. I'm giving you a h- bigger picture of the whole market and helping you feel good. "Well, if you choose this or you choose that, now you know why."

   14. LRLenny Rachitsky24:57

       I think what's interesting about this is a lot of startups fail because they can't convince anyone to switch from the status quo. And I think people always think of that as the current product is good enough and that's why they're losing. But I think this adds an additional wrinkle of it's also the person buying it is just like, "I don't want, I don't want, I don't wanna add the stress to even decide and make the choice and put my butt on the line to switch." And I never thought of it that way.

   15. ADApril Dunford25:21

       Yeah. Like I, like I think that hurdle is a lot more than you think, right? So we obviously have to compete with status quo. Like we can't ignore status quo, because sometimes status quo just is good enough, you know? And, and so we can't ignore that. We still lose deals to status quo. But we lose an awful lot of deals to just plain customer indecision, customers being more afraid of screwing up than missing out.

7. 25:46 – 29:28

   Avoiding FOMO as a sales strategy

   1. LRLenny Rachitsky25:46

      So to try to overcome that, to drill into the things you find most powerful, one is help the customer understand the bigger picture and why it's, why essentially they're falling behind, why maybe competition is gonna have an advantage 'cause they're using thinking in a different way.

   2. ADApril Dunford26:04

      Well, I'll throw something out about that.

   3. LRLenny Rachitsky26:06

      Please.

   4. ADApril Dunford26:07

      (laughs) So, so a- a- and I've heard people talk about this a lot, um, that, you know, one of the things we could do in this situation when a customer is feeling this indecision is to kinda lean into this FOMO-

   5. LRLenny Rachitsky26:20

      Mm-hmm.

   6. ADApril Dunford26:20

      ... and say, "Look, you're missing out. Like, ah, the competitors are all doing it, and you're not doing it." And so this is an interesting question. And so I was super excited, Matt Dixon wrote this book called The JOLT Effect, and in that they, they studied two and a half million sales calls, they recorded on Gong, and they studied it with AI and then they looked at what happened after the sales call. So were these successful or not successful? Did a deal happen or whatever? It's pretty rare that we get a chance to, like, dig into some data like this. And so what his data showed is if a customer is indecisive, throwing FOMO into the mix makes it worse. So they are less likely to close the deal if you throw that in. And the, the, the idea is that they're already stressed out. (laughs) And you're just putting more stress on them by pressuring them, by saying, "Oh, this is how the bad things are gonna," you know, there's things, you know, you're like, "Ah, bad things will happen if I do something, bad things will happen if I don't something. Ah, what do I do?" (laughs)

   7. LRLenny Rachitsky27:21

      They just put their head in the sand, right? They're just like, "Ah, forget it."

   8. ADApril Dunford27:24

      So they're just like, "Forget it. I'm doing nothing. Now I'm totally paralyzed." And so, eh, there's an assumption that companies are very motivated by this FOMO thing, but I think that that is not always true. And if the customer is actually indecisive, throwing in this FOMO thing isn't gonna do it. So what does work in that situation is one, giving them the tools to make the decision. So that includes painting a picture of the market, teaching them how to buy essentially. So teaching them, "Look, for customers like you, you just have to worry about these three or four things. And all this other stuff, it doesn't apply to you. That applies to bigger companies, that applies to whatever." So this idea of teaching a customer how to buy is one way to take that stress down. And then there's a whole bunch of other techniques you can use. So one is y- you know, you could, if it's a really big deal, we can split it into smaller pieces. We can do things like offer you a money back guarantee. We can do things like sometimes we have services and support that are gonna help you if things go bad, and this is how we're gonna make sure... So this idea of being able to take risk off the table is a really serious one if we've got a customer that is actually paralyzed because of this indecision thing.

   9. LRLenny Rachitsky28:35

      That makes a lot of sense. Basically, it's like how do we help the buyer cover their ass if they made a mistake-

   10. ADApril Dunford28:40

       Yes. Exactly.

   11. LRLenny Rachitsky28:40

       ... because what you're saying is that's the main reason they're not buying your product.

   12. ADApril Dunford28:43

       That's it. And this FOMO thing is just not gonna do it.

   13. LRLenny Rachitsky28:45

       So interesting. So I really like this framework. I wrote this down, teaching them how to buy. That is a really simple way of just thinking about this whole process.

   14. ADApril Dunford28:53

       Well, you know, it's funny. I was having this conversation with, um, Bob Moesta, you know, he used to jobs to be done.

   15. LRLenny Rachitsky28:58

       Yeah, I watched that episode.

   16. ADApril Dunford28:59

       Yeah. So he, so, so he's just the best. And so, so one of the things I think of is like normally when we come at this, we're like, "Well, how can we convince the customer that we do the job that they need to have done?" And obviously we need to do that. But there is this kind of secondary job that the champion of the deal is and that's, "How do I make a decision without getting fired?" (laughs)

   17. LRLenny Rachitsky29:21

       (laughs)

   18. ADApril Dunford29:22

       And so, who we gotta help them accomplish that job, otherwise we don't get what we want, which is the

8. 29:28 – 31:04

   Lenny’s stressful experience buying community forum software for Airbnb

   1. ADApril Dunford29:28

      money.

   2. LRLenny Rachitsky29:28

      It's so interesting. And it's not even like necessarily get fired. It's m- like even their performance suffers or they don't get-

   3. ADApril Dunford29:33

      Right.

   4. LRLenny Rachitsky29:33

      ... their promotion. It's like, yeah. Like did they do a good job?

   5. ADApril Dunford29:37

      Look at that. Yeah.

   6. LRLenny Rachitsky29:37

      I mean, this makes me think of a process at Airbnb we went through to buy community forum software.

   7. ADApril Dunford29:42

      Mm-hmm.

   8. LRLenny Rachitsky29:42

      And I just remember these like massive teams of salespeople coming through the office and pitching everyone on the software and it was... And they just keep like pushing you to make, like what's the next step here? Who, who do we need to roll in? Who needs to buy into the... And it's just like, oh my god, so stressful. I have to, like, keep this thing moving. And then there's IT coming in, like, "Oh, we gotta make sure it integrates with Salesforce." And like your start with, "I just wanted the best community forum software, 'cause we're trying to build something really different and unique," and you end up with like, "Okay, it's fine. Let's just go with the thing that works with Salesforce. It's all good. I'm just gonna move on to (laughs) another process."

   9. ADApril Dunford30:15

      Well, this is the thing. It's so easy to default to the market leader in that situation. Like the market leader has this big advantage that you can say, "You know what? Who's gonna, who's gonna get me in trouble for picking Salesforce? Nobody."... right? Like, it's so easy to just flip back on that. And so if you're the challenger in this situation, eh, the brand that's number two or number three, like, you've got to get over all of this inertia and, and tilting towards the status quo, 'cause it's just so easy, it's the lowest risk decision besides do nothing, is to just pick the leader in the market, "We'll just run with that."

   10. LRLenny Rachitsky30:48

       Yeah. I think the classic phrase was, "No one gets fired for buying Microsoft." I wonder if it's, like, is it Salesforce now? What's the default-

   11. ADApril Dunford30:53

       Yeah.

   12. LRLenny Rachitsky30:54

       ... version of that now?

   13. ADApril Dunford30:54

       Yeah. The original one was IBM-

   14. LRLenny Rachitsky30:56

       Oh, IBM. (laughs)

   15. ADApril Dunford30:57

       ... no one gets fired for buying IBM.

   16. LRLenny Rachitsky30:57

       Oh. I think you're right. Oh, man.

   17. ADApril Dunford30:58

       Now you totally get fired for buying IBM, I don't know. (laughs)

   18. LRLenny Rachitsky31:01

       (laughs)

   19. ADApril Dunford31:01

       I don't know what happens. (laughs)

9. 31:04 – 34:36

   Empowering champions within client businesses

   1. LRLenny Rachitsky31:04

      (laughs)

   2. ADApril Dunford31:04

      The other thing you bring up is I think a, an interesting thing to think about too, that really messes people up in these situations, is that in B2B, typical purchase process, we have five to seven people involved in making a deal happen.

   3. LRLenny Rachitsky31:17

      Mm-hmm.

   4. ADApril Dunford31:17

      And so there's this complexity we don't have in consumer, right? But, uh, a lot of people, I think, over-complicate that. Like, in a typical B2B purchase process, we've got someone in that buying team is what we would call the champion. So that person is the person who's been tasked with, "Hey, pick us the accounting software," or, "Pick us the CRM. You, you figure it out." And so that person is the person that does the initial research, makes the short list, probably sits on the first calls, and then there's all these other people. Now, the other people can't make a deal happen, but they can kill it, (laughs) a thousand ways. (laughs) So the way this works is you have to... Your positioning, and your pitch needs to really work for the champion. Because if it doesn't, you don't even get to talk to anybody else, like, you don't even get to t- go near anybody else if you don't make it on the short list and you don't get the deal cooking. But once the deal is cooking, it is on you to arm that champion to handle all the objections, potentially, of all the other groups. So, you know, eh, so if you're the line of business buyer, let's say you're in the sales department and you're buying a CRM, it... IT is gonna have to get involved at some point, and IT doesn't really care about the value of your CRM. What they do care, does it meet the security pr- requirements, and does it integrate with the stuff we already have, and how much of a pain is this thing gonna be to manage? And so we're not actually pitching value to those people, we're just handling objections. And so, uh, once we realize that, then we can get really tight on our positioning and our sales pitch.

   5. LRLenny Rachitsky32:51

      Mm-hmm.

   6. ADApril Dunford32:51

      Like, what we're really trying to do is just cook the champion, get the champion, and then once the deal's going, we gotta arm the champion for how to handle all these objections of all these other groups so that you can get a consensus to get a deal moving forward.

   7. LRLenny Rachitsky33:05

      Well, how do you actually do that? Is it ask them, "What are all the concerns you're hearing?" Is it ask the individual stakeholders, "What are your big, biggest concerns?"

   8. ADApril Dunford33:11

      Well, if, if we're really smart, we already know-

   9. LRLenny Rachitsky33:13

      Mm-hmm.

   10. ADApril Dunford33:13

       ... 'cause we've done lots of deals, right?

   11. LRLenny Rachitsky33:15

       Mm-hmm.

   12. ADApril Dunford33:15

       So if we're being a good partner in this, you know, we're in... W- sometimes even in the very first meeting, we're saying, "Hey, look," you know, y- y- in that spot where we're talking about objections, we're gonna say, "Hey, look, IT is gonna come in, and they're gonna be worried about this, this, and this. Don't worry, we got you."

   13. LRLenny Rachitsky33:30

       Mm-hmm.

   14. ADApril Dunford33:31

       Right? So, me, you know, "We're SOC 2 compliant, we do this, we do that." We know, 'cause we've done 15 deals, and we know what these deals are like, and we know what they're, uh, what the stuff is gonna be. You might have the champion come in and say, "Well, I don't know, you know, end users might not like it." And it's like, "Okay. Well, here's how we're gonna get your end users on board, this is the training we have, this is the stuff we're gonna do." Eh, the neat thing if you have a product like Growthring on the front end of that, it takes that objection off the table. But, um, you know, and you might have other things like, you know, "You're gonna take this to your boss, and they're gonna wanna know ROI numbers," and blah, blah, blah. "And we've already done that. Look, here's our calculator. You know, if you give us this information, we can put this in. Here's how you sell your boss." So that's what we're doing. We're trying to arm them, because we've done a million deals, they've never bought software like this before. (laughs)

   15. LRLenny Rachitsky34:18

       (laughs)

   16. ADApril Dunford34:18

       So half the time, y- you'll be doing deals and they don't even know what the purchase process is. And so, you know, if we're being good partners, we're like, "Okay, does this need to go to purchasing?" And they'll say, "Yeah, probably does." "Oh, well, you know, here's what typically happens in purchasing. They're gonna do this, this, this, and we're gonna give you this stuff, and that's gonna help you get it through purchasing."

10. 34:36 – 36:38

    Who this framework is useful for

    1. ADApril Dunford34:37

    2. LRLenny Rachitsky34:37

       The way you're describing it now makes it s- um, feel like you need to be a big company for this to be useful, because smaller companies don't have all these reps, and they may not have the resources to do all these things you're describing. Who is this framework useful for? Can you use this approach if you're just, say, like, an early stage B2B that way?

    3. ADApril Dunford34:53

       Well, so it's B2B products, if you don't have a sales team, like, if you don't have a sales team, I still think you can use this structure to build a story that marketing can use and you can use in different ways. We can talk about that. But i- in the companies that I work with, they're B2B, they've got a sales team, and so the immediate thing we're doing is we're making a shift in positioning, we're building a sales pitch that reflects that positioning. We can immediately implement that in sales even though it's gonna take a while for us to forklift the messaging and do other stuff and change our campaigns and everything else to match this new positioning. But we can tighten up the sales pitch and have an immediate impact over in sales on that. Second thing is that I've worked with tons of companies where it's, you know, the founder is the only sales rep. (laughs) And this works pretty good for that. I don't think we need a ton of resources to do it, but I do think we need to have enough traction in the market that we understand how a deal typically goes. So if we haven't sold anything yet, then we don't know yet. It's hard for us-

    4. LRLenny Rachitsky35:51

       Mm-hmm.

    5. ADApril Dunford35:51

       ... to help you buy something if we don't even know how to sell it. (laughs)

    6. LRLenny Rachitsky35:54

       Mm-hmm.

    7. ADApril Dunford35:55

       But if I've done 10 deals, I know what happens. I know what... I, I got a pretty good guess of what IT is gonna say when you try to implement this stuff. I have a good guess of what's gonna happen when we go to roll it out. I have a pretty good guess of what your boss might object to or might get excited by. And so I don't necessarily need, you know, a research team to go figure this out. This is just me trying to be helpful and help the champion do their job of getting this deal to the finish line.

    8. LRLenny Rachitsky36:22

       So maybe the MVP of this approach is a deck that you continue iterating and adjust and restructure-And also, bullet points of things you wanna bring up like, "Okay, cool. IT is gonna ask for these things."

    9. ADApril Dunford36:35

       Yeah.

    10. LRLenny Rachitsky36:35

        A few bullet points that you kind of keep track of.

    11. ADApril Dunford36:37

        Exactly.

11. 36:38 – 38:59

    Advice on working cross-functionally

    1. ADApril Dunford36:38

    2. LRLenny Rachitsky36:38

       I'm also thinking from the perspective of a product team building a product, they don't really sell it themselves, they work with sales, they work with marketing. Was there anything that you would recommend or that you think product teams could learn from this approach of selling that would help them build products in a different way or work with sales in a different way?

    3. ADApril Dunford36:59

       Yeah. So I, uh, so here's what I think, like, the core of a good sales pitch is really deeply understanding your differentiated value, which is, what is the value I can deliver that no other solution can? Often what I see at companies is you've got a smart product team and they know a lot about the stuff they're building and why it's important and what the value is to the customer, and they did all this work on that when they were building it. But that information never made the jump to sales.

    4. LRLenny Rachitsky37:27

       (laughs)

    5. ADApril Dunford37:29

       (laughs) 'Cause sales isn't even trying to pitch value. They're just pitching features, like, "Here's the dropdown menus. Here's what they do." And so, so the first step in, in fixing this, I think, um, is to have a cross-functional team work on positioning. So if I've got product, marketing, and sales together in the room working on defining what our differentiated value is, then I'm gonna get all the good juice out of the product team that deeply understands the product, deeply understand what's differentiated about it, deeply understands value, and then I'm also gonna have the, all the juice from the sales team that understands what the common objections are, you know, what, what the champion really wants to get done and doesn't want to get done, what the situation is in a typical account.

    6. LRLenny Rachitsky38:13

       Mm-hmm.

    7. ADApril Dunford38:13

       And then all of this cool information sharing happens, which actually you end up with way better definition of your differentiated value in the first place. And so once we've done that work, it is very natural then for us to work together on the sales pitch that reflects that. What typically happens is not that at all. What typically happens is product's working on some stuff, sales working on some stuff, marketing's working on some stuff. Marketing in their own little bubble comes up with positioning. They might build some stuff for the sales team, heave it over to the sales team. Sales team looks at it and says, "I don't get what any of this stuff is. I disagree with this. This doesn't match what I see." And they just throw it out, and they go back to doing the same pitch they've been doing since the year of the flood. (laughs)

    8. LRLenny Rachitsky38:56

       (laughs)

    9. ADApril Dunford38:56

       (laughs)

    10. LRLenny Rachitsky38:57

        That's a long time.

12. 38:59 – 44:16

    Differentiated value defined with examples

    1. LRLenny Rachitsky38:59

       So our first podcast episode was all around positioning, and so if folks want to get deep into that, they should listen to that. So we're not gonna spend tons of time there, but differentiated value is a big part of this process also, so I think it's worth spending a bit of time here. Could you maybe share a couple examples of, like, what this is to give people a sense of, like, what does it mean to be... to share differentiated value?

    2. ADApril Dunford39:20

       Yeah. So differentiated value is kind of the answer to the question, "Why pick us over the other alternatives?" And so the way we get at that in positioning is we start with, you know, putting a stake in the ground of, who do we actually compete with? And so, you know, if we didn't exist in the market, what would a customer do? And so typically, there's some status quo thing. It might not even look like you. It might just be a spreadsheet or do it with the intern or manual labor, and then there's whatever else ends up on a short list against us, and it's basically the definition of, you know, I gotta beat all this plus indecision-

    3. LRLenny Rachitsky39:55

       Mm-hmm.

    4. ADApril Dunford39:55

       ... in order to win a deal. So I can stick my stake in the ground. Sales knows the answer to this question. If you have a sales team, they know the answer to this question. Like, who, you know, what would a customer do if we didn't exist? They know. And then we get to the next step is, well, so what do we have that's different? And that's capability wise, feature function of the product or capability of the company, so it could be features, it could be your pricing model, it could be we have support in a way that the other folks don't. So there's all kinds of things it could be. It could be the breadth of the portfolio that you have beyond that one product. It, th- we could fill whiteboards with this stuff. And then what we do is we go down that list of features and we say, "So what?" So, you know, you got advanced AI, whatever the heck the thing is.

    5. LRLenny Rachitsky40:39

       Mm-hmm.

    6. ADApril Dunford40:39

       So what? Why does anybody care? And the answer to that so what is your value, and, and because it came from this differentiated feature, it's generally value that the other guys can't deliver 'cause they don't have the capabilities that deliv- to that underpin it. So if I give you an example, um, so at a company I worked with, uh, a few years back, they recently g- have been acquired by Salesforce called LevelJump, and so they're in the sales enablement space, which is terrible. There's a million companies in the sales enablement space, and they all kind of look the same. And so LevelJump, you know, so if you look at, well, you know, if, if what's the competitive alternatives, if I look at all the companies in the sales enablement space, you can kind of put them into two buckets in terms of approaches. They're either a CMS, like a jazzy content repository where you can make sure that people are using the right content and whatever, or they're an LMS, a learning management system, which, you know, I can build a course and certify you on the course, and that's how we're gonna train the sales reps. If you look at LevelJump, their differentiated capability is they're the only one that's built on top of Salesforce. That's the feature. You know, we're built on Salesforce. The other folks aren't. And then, but who cares? Like, so what? (laughs) And so when we first had a conversation about it, the, you know, there was five or six different answers to that so what question, but the big answer was, "Well, because we're built on top of Salesforce, my, my sales enablement data is integrated with my sales data." And then you say, "Well, so what about that?" Well, because then that means if I can actually tell did the sales enablement improve time to first deal or improve time to make quota. Well, so what about that? Well, if I improve that ramp time, then we get way more revenue faster. (laughs) So that's the differentiated value. When I go to do that in a sales pitch, I can translate that into my insight. My insight is every day your rep's not making quota costs you money.

    7. LRLenny Rachitsky42:37

       Mm-hmm.

    8. ADApril Dunford42:37

       So if we really want to solve sales enablement, don't we really want to have something where we can measure whether or not the sales enablement is working with sales metrics? Yeah, we do.

    9. LRLenny Rachitsky42:46

       Interesting. So the differentiated value often informs the insight that you-

    10. ADApril Dunford42:50

        It does.

    11. LRLenny Rachitsky42:51

        ... start with.

    12. ADApril Dunford42:52

        It absolutely is.

    13. LRLenny Rachitsky42:53

        Yeah.

    14. ADApril Dunford42:53

        Like the, the insight is basically the context that makes your differentiated value important.

    15. LRLenny Rachitsky42:59

        Mm-hmm.

    16. ADApril Dunford42:59

        Like what is the thing you need to know to understand the importance of my differentiated value? In the case of Help Scout, the insight is, uh, look, digital businesses, like, customer service is a growth driver. Where does that come from? Like if you look at their differentiated value, it's there, and so we can just reverse it, flip it around. Even if the product wasn't necessarily constructed with that insight, maybe we got there sideways or the roundabout way or whatever, we iterated our way into that, we can look at the differentiated value and then basically reverse it out to the insight.

    17. LRLenny Rachitsky43:32

        What's a sign that the differentiated value or insight that you've come up with just isn't clicking?

    18. ADApril Dunford43:37

        If the differentiated value doesn't work in a sales pitch, what you'll get is the company going, "Why would I pay for that?" (laughs)

    19. LRLenny Rachitsky43:43

        Mm-hmm. Yeah.

    20. ADApril Dunford43:45

        Like, "This is not value for me, buddy." (laughs)

    21. LRLenny Rachitsky43:49

        Yeah.

    22. ADApril Dunford43:50

        Like th- the way I look at it is, you know, with the companies I work with, the way I look at it is if you're in market and you're selling and, and you have happy, engaged customers, there's differentiated value there. That's why they picked you. That's why they love you. That's why they don't turn out on you. It's there. You might not know what it is. We might have to, you know, we might have to do a little process to get at it, but it's there and it exists.

13. 44:16 – 46:19

    Selling with calm confidence

    1. ADApril Dunford44:16

    2. LRLenny Rachitsky44:16

       Awesome. Another question that's been in the back of my mind since we started talking about differentiated value is just how, how honest should you be about the competition? Obviously, there's a spectrum of extremely honest to, like, super biased. What's your guidance on just like how honest to be there?

    3. ADApril Dunford44:33

       I mean, th- the, th- the posture I think you should assume in a, in a sales situation is... I had an old boss who used to talk about this, is the posture we should have is calm confidence. So the... Where that calm confidence comes from is we really understand why people should pick us, so this differentiated value. We really understand it, and we really understand who that's a really good fit for, and we don't even bother trying to chase anybody else.

    4. LRLenny Rachitsky45:02

       Mm-hmm.

    5. ADApril Dunford45:03

       So we should be able to come in and say, "Look, we're sales enablement that delivers results. If you don't care about those results, you shouldn't pick us." (laughs) "You should pick someone else." (laughs)

    6. LRLenny Rachitsky45:15

       Mm-hmm.

    7. ADApril Dunford45:15

       And so generally what we're trying to be is extremely honest. So we're trying to come in and actually give credit where credit is due with the other approaches, because typically the other approaches work just fine for other kinds of companies. Like if you're a really small and you're not growing e-commerce business, use a shared inbox. It's free, it's easy to use, there's, there's no problems there, just use it, right? (laughs) If you're really worried about bringing the cost down in a customer service center, maybe you should use Zendesk. Like and so I think the more we can be... we can act as a guide in this situation and, and come in and say, "Look, like, these guys are good for this, these folks are good for this, and we're good for this. And you might not care about that. And if you don't care about that, we're not the one for you. You shouldn't pick us." But I think that what, you know, w- this calm confidence idea is that where we know the client should pick us, we should be unafraid to fight for that business, but we should totally walk away from business where we're not the best fit. We shouldn't be chasing that

14. 46:19 – 48:31

    Qualifying leads

    1. ADApril Dunford46:19

       business at all.

    2. LRLenny Rachitsky46:20

       And this comes back to teaching them how to buy again and again.

    3. ADApril Dunford46:23

       Yeah.

    4. LRLenny Rachitsky46:23

       For these cases where you're like, "This is not a fit," ideally you know that before you, like, fly to their office and pitch them.

    5. ADApril Dunford46:29

       W- yeah. Like generally you've had some kind of qualification-

    6. LRLenny Rachitsky46:32

       Mm-hmm.

    7. ADApril Dunford46:33

       ... happen upstream, and so that qualification could be done in lots of different ways. Like if it's, if you got some kind of product like growth motion in the beginning, you're looking for signals in that. And if the signals aren't there, then you're not talking to them. (laughs) And so, you know, if you, if you've designed your signals right, then you already know there's intent there, you already know you're a fit, you already know stuff. The way a lot of companies do this is they'll have inside sales do a qualification call before they set up a first call with a sales rep. In that qualification call, you're trying to make sure, you know, is this the right person? Do they have a need that we can actually meet? Is this actually a good fit for what we do? And if they're not, they don't even make it to the call.

    8. LRLenny Rachitsky47:10

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15. 48:31 – 53:05

    April’s thoughts on category creation

    1. LRLenny Rachitsky48:32

       Another question around this idea of differentiated value and just alternative approaches is there's a, a certain previous guest who was very big on creating a category being extremely important and that potentially being the only way to build a legendary business. I know you have a different perspective on that, because in theory if you go that direction, there's no alternative, it's like, "We're the one." What's your take on, on that?

    2. ADApril Dunford48:55

       Well, so here's, so here's a few things. So one, obviously creating a category is not the only way to create a legendary business, because the vast majority of legendary businesses did not create the categories that they're in. (laughs) So Google did not create search. Facebook did not create social network. Like, I mean, there's, there's so many of them. It's actually more of an exception to the rule that the company is creating a category than the other way around. So, so I think it's a bit disingenuous to say the only way. You know, it is a way to build a big business, no question about that. But it is absolutely not the only way. In fact, it is... It, it, you know, it's- it's not the most common way, but it is a way, and it does work. So that's one thing. The second thing is that ca- category creation's interesting. Like most companies, if you look at their, at their arc, um, they did not, even the category creators that are successful, they did not start out as category creators. So they started out as a niche play in an existing category, and that's because that's generally the easiest way to get traction for a company early, because what is the job of the market category? The job of a market category is to help answer the question, like, "What is this thing all about?" If I'm positioning an existing category, I can say, "Well, I'm CRM for very small businesses." That was Salesforce's initial positioning. (laughs) I didn't have to explain to you what a CRM was. That already existed. There was already a billion-dollar company in that space. We know what a CRM is, and I could say, "We're a CRM for very small businesses. The reason you can use it, this very small business, is we don't have any software, so you don't have to have an IT department to babysit it." It's fantastic. So most companies start there. Now, what happens is, is that if you become the dominant player in that space, which a- again, category creation folks talk about this, like, no category creator has ever lost the market. In fact, most category creators (laughs) lose the market. Like, what happened to Myspace? What happened to Ask Jeeves? (laughs) It didn't work out so good for them. Most category creators actually get overtaken by fast followers. So if we look at the CRM market, Siebel was the big dominant player there, and now they're not, so now we've got Salesforce. Once you're the dominant player in that market, a cool move to do is to actually extend the boundaries of the category so that you can continue to grow, and most of the category creation examples we see are companies that when they were 200, 300, 400 million revenue, dominating their space, then decided to move the goalpost and say, "Well, actually now we're, we're expanding into all these other areas, and we're gonna call this category something," and that's what it is. And there's loads of examples of that. Like, you know, Qualtrics, for example, is a company that a lot of people talk about very successful category creation. Well, they were survey software up until they were 300 million revenue, just like everybody else, in an existing category, so that got them there, and that worked just fine. Oh, well, once we're dominating it, now we can say it's whatever it is, customer experience software or whatever it is. Um, Snowflake, another good example, like data warehousing in the cloud. They were that, like data warehousing, an existing market, were data warehousing for the cloud. That is not category creation, and that took them all the way up to the point where they were about to go public, and now they're Cloudata, which is their attempt to expand and say, "Well, it's not just data warehousing, it's actually data lakes and a lot of, uh, you know-"

    3. LRLenny Rachitsky52:21

       Mm-hmm.

    4. ADApril Dunford52:21

       "... all other data stuff." And so that's a smart move for them, because they're now very well known in that space. You know, I- I'm not saying category creation's a bad thing. There are examples of company that came right out of the gate and cre- successfully created a category and then survived to own the category longer term. But a more common thing that happens is that the company does the hard work of creating the category and then exactly the moment where the category starts to take hold, fast follower can come in with fresh funding and a lot of it, and, and learn from all your mistakes and come in and knock you off the, off the peak right when you're, right when you're, you think you've made it. So I think category creation is, you know, again, it's good, like it,

16. 53:05 – 55:21

    Geoffrey Moore’s “bowling pin strategy”

    1. ADApril Dunford53:05

       it works, but I think we have to be very careful when we're thinking about doing that at early stage business or a business that isn't already dominating the category that they're in. It's much more common to see companies come in, shave off a piece of the market, dominate that, and then successfully branch out. It's what Geoffrey Moore called bowling pin strategy. Almost all successful companies follow bowling pin strategy.

    2. LRLenny Rachitsky53:29

       Wait, what is that? Let's touch that, touch on that real quick.

    3. ADApril Dunford53:31

       Oh yeah, you heard of that. Think it's funny how many times I've talked about bowling pin strategy in the last two months.

    4. LRLenny Rachitsky53:35

       Huh.

    5. ADApril Dunford53:35

       So this comes from a bunch of work that was done around um, e- the way innovation gets adopted, blah, blah. So there's a bunch of research done on this stuff, but y- you know, and I'm gonna misquote it because Geoffrey Moore's stuff, I've been reading it for decades.

    6. LRLenny Rachitsky53:48

       Mm-hmm.

    7. ADApril Dunford53:48

       But bowling pin strategy goes like this. The easiest way to take over a great big market is to define a segment of the market that is underserved by the market leader, and so if you think about a bunch of bowling pins, we're gonna circle around the lead pin, which is this little piece of the market that's easy for us to go get and the, the market leader probably doesn't care about it. And so we knock over that pin, and knocking over that pin enables us to get to the three pins right beside it. And so now I'm established here as a beachhead, and I can go get the next three pins. I'm gonna knock those over, and eventually I get big enough to challenge the market leader and then I overtake them. So the example from my early career was I worked at this company. We were, we thought we were enterprise software. We narrowed it down to CRM for investment banks, and so we literally drew bowling pins for our investor and said, "Lead pin is CRM for investment banks. Once we knock that over, then we're gonna go to retail banking, then we're gonna be CRM for banking. And then once we knock that over, we're gonna go to insurance, then we're gonna be CRM for financial services. Once we knock that over, then we're gonna be a great big company and we're gonna challenge Siebel to be CRM for enterprise software."... instead, we got acquired by Siebel for, like, a billion bucks, but whatever. So most companies, if you look at the history of them, they actually start that way. And so, yeah, if we just fast-forwarded to when they were 300 million-

    8. LRLenny Rachitsky55:15

       (laughs)

    9. ADApril Dunford55:15

       ... (laughs) we could say-

    10. LRLenny Rachitsky55:15

        Yeah.

    11. ADApril Dunford55:16

        ... category creation's the only thing to do. But it's like, well, what happened before then? That was something different.

17. 55:21 – 57:11

    Conclusion of the setup phase: sharing the perfect world

    1. ADApril Dunford55:21

    2. LRLenny Rachitsky55:21

       Awesome. Let's come back to your framework. I'm looking at the list of bullet points. So, we've covered a lot of this already actually. So there's the insight where you help them understand what's happening in the world and what's changing and why this is important. Then you talk about what the alternative approaches might be, pros and cons. Then there's this third step which we haven't talked about yet, which is sharing the perfect world, characteristics of a perfect solution. Can you talk a bit about that and why that's important?

    3. ADApril Dunford55:46

       So this is the conclusion of the set-up phase. So, you know, if I'm Help Scout, for example, the conclusion is, you know, we say, "Look, like, y- you really want customer success software that's, you know, that's as easy to use as an inbox. You're never gonna outgrow it, but it was built from the ground up to be, you know, to deliver an amazing service." And so, it's this part of the pitch where we actually get agreement with the customer that we are aligned in terms of our point of view on the universe.

    4. LRLenny Rachitsky56:19

       Mm-hmm.

    5. ADApril Dunford56:19

       So it's where I say, "Okay, we've had our little discussion about the pros and cons of the other alternatives," and we say, "So look, so are you with me, man? Like," (laughs)

    6. LRLenny Rachitsky56:28

       (laughs)

    7. ADApril Dunford56:28

       "can we all agree that a really good solution for you would have A, B, and C?"

    8. LRLenny Rachitsky56:32

       Mm-hmm.

    9. ADApril Dunford56:32

       And, and the customer's either like, "Yeah," right, or they're not. And so if they're right with you on this definition of the perfect world, then all, then I've got you. Like, I've already won the deal and I haven't even talked about us yet.

    10. LRLenny Rachitsky56:45

        Mm-hmm.

    11. ADApril Dunford56:45

        Because the way I've set it up, I'm the only one that can deliver that. So if you say right, all I gotta do is prove that I can do that and get you over the hurdle that it's possible for you to adopt it.

    12. LRLenny Rachitsky56:58

        Sounds, sounds too easy, but-

    13. ADApril Dunford57:01

        Yeah, I mean (laughs)

    14. LRLenny Rachitsky57:02

        That's how you, that's how you lure them in.

    15. ADApril Dunford57:03

        If all of this was easy, Lenny-

    16. LRLenny Rachitsky57:05

        Yeah (laughs) .

    17. ADApril Dunford57:05

        ... we would be on a beach drinking out of a coconut. (laughs)

    18. LRLenny Rachitsky57:08

        Oh, man. Let's, let's make it happen. Um, okay.

18. 57:11 – 1:00:21

    The follow-through: differentiated value with proof and objection refutation

    1. LRLenny Rachitsky57:11

       So that's the set-up. What do you call the second part again?

    2. ADApril Dunford57:14

       Uh, the, it's, it's the follow-through-

    3. LRLenny Rachitsky57:15

       The follow-through.

    4. ADApril Dunford57:15

       ... which is really focused on differentiated value.

    5. LRLenny Rachitsky57:18

       Yep.

    6. ADApril Dunford57:18

       So in this second part, the first step is usually we introduce our stuff, which is where the, the, the market category is important. So we, you know, we come in and we say, "Okay, can we agree that a really good solution should tick these boxes? Yes? Okay, good. Now let's talk about us."

    7. LRLenny Rachitsky57:32

       Mm-hmm.

    8. ADApril Dunford57:32

       "Okay, so then, you know, we believe that. That's why we build what we built. So here I am, I'm Help Scout, we're customer service software for digi- digital businesses." Or what, you know, whatever our market category is. So we introduce it just to get people straight in their mind about what it is, and then we move to, "Here's the value. Here's how we do it." If we think about a typical sales call, like, let's say a sales call is half an hour, 45 minutes, I would expect to spend more than half of the time in the sales call in this differentiated value phase. So if we're doing a demo, that's the demo, and we're saying, "Okay, step one, let me show you how we do this," right? So, easy to use as an inbox, here's the features. You know, never have to outgrow it, here's the features. Delivers amazing customer experience, here's the features. And so that's where we're doing, you know, we're getting to the meat of what you thought you were getting when you clicked on the button that said give me a demo. (laughs) That's, so that's what we're doing there. And then we end with these three little pieces. One is, generally, I gotta show you some proof that I can do what I say I can do. So if, if I'm claiming this thing delivers an amazing customer experience, y- how do I prove that? Well, I can prove it by other customers saying that it was amazing. (laughs) That's one way to prove it. If I had some independent third-party, you know, data that proved whatever I was claiming, I could show that there too. But a lot of times what we're doing is we're like, "Let me show you how this worked in a company that used our stuff."

    9. LRLenny Rachitsky58:59

       Mm-hmm.

    10. ADApril Dunford58:59

        So here's what the before looked like, they did this thing, here's the after. And so, customer case study is usually a good way to do that. But there's usually a step called proof, which is, "I showed you the value, now here's the proof that I can actually deliver on that value and it's not just me blowing smoke." And then the step after that then is this optional objections step where they say, "Oh, yeah. Sounds good, but IT's never gonna go for it," (laughs) or, "Sounds good, but maybe it's gonna be too expensive," or something. And so you're gonna handle that objection as best as you can, and then you finish with the ask, which is, you know, whatever, whatever the next step in your sales process is. So if it's, you know, "Hey, well, this, you know... So what will we have to do to get a deal cooking here? Like, do, do you, do we have to get IT involved? Does IT need to see it? Would you like us to come in and present with you with IT, or do you want me to just help you, you know, work on some stuff for IT?" Like, it's whatever your next step in the sales process is.

    11. LRLenny Rachitsky59:56

        Awesome. So let me read through this just to have it all succinctly here in case people are taking notes or trying to remember this stuff. So there's the set-up, there's the follow-through within the set-up. You have the insight, the alternative approaches, pros and cons, and the perfect world. And then you introduce your product, talk about the differentiated value, share the proof of why it works, potentially handle objections, silent objections, and then the ask of what comes next.

    12. ADApril Dunford1:00:20

        That's right.

19. 1:00:21 – 1:01:30

    Why sales pitches fail

    1. ADApril Dunford1:00:21

       That's it.

    2. LRLenny Rachitsky1:00:21

       In terms of knowing if this is working and if your differentiated value works or if your insight works, do you have kind of a heuristic of a success rate that feels right? Like, how often should this work for you to feel like, "I think we have it"?

    3. ADApril Dunford1:00:34

       Well, so generally if the sales pitch isn't working, it's because the positioning was weak.

    4. LRLenny Rachitsky1:00:40

       Hmm.

    5. ADApril Dunford1:00:41

       And so, companies that jump straight to building the new sales pitch without going back and really making sure that they really nailed the differentiated value, who knows? Maybe it works, maybe it doesn't. And a lot of times it doesn't, I think. And so, in the work I do with my clients, we go all the way back to the beginning. So we go right back to l- let's work on the positioning first. Now, if I've got the smartest people from the company in the r- room and we've done enough deals that we're pretty knowledgeable about how customers buy and what they like and what they don't know, if I've got the senior executive team in the room and they've got a reasonable amount of customer experience, we can...... pretty much feel good that the positioning we come up with, if we're following the process, will be good. Then it's just a matter of taking that positioning, mapping it to the sales pitch, and then going to test it.

20. 1:01:30 – 1:05:32

    Best practices for pitch testing

    1. ADApril Dunford1:01:30

       So, I think there's a bunch of things in testing that are really important. So one is, we absolutely need sales involved in building the pitch. If we don't have sales involved in building the pitch, the pitch is never gonna stick. Like the rule with sales reps is even if they don't like their current pitch, they're comfortable with the current pitch, and they know it, and they've memorized it, and they have a little joke they tell on slide three.

    2. LRLenny Rachitsky1:01:51

       (laughs)

    3. ADApril Dunford1:01:51

       So they're not gonna give up the current pitch without a fight.

    4. LRLenny Rachitsky1:01:54

       Mmm.

    5. ADApril Dunford1:01:54

       And so y- you know, you've gotta get sales management involved in building the new pitch. And then I would never just build the new pitch and then heave it over the wall and say, "Good luck, Chuck."

    6. LRLenny Rachitsky1:02:02

       (laughs)

    7. ADApril Dunford1:02:02

       (laughs) 'Cause th- what'll happen is they'll come up with all kinds of excuses why they can't use this pitch.

    8. LRLenny Rachitsky1:02:07

       Mm-hmm.

    9. ADApril Dunford1:02:07

       Instead what you do is you take your best sales rep, your best one, and you, you bring your best sales rep over and you train them on the new pitch. Like they gotta lear- they gotta learn it, they gotta pitch it to you, pitch it to the head of sales. We do a bunch of repetition on that. And then we have that rep test the pitch with qualified prospects. So we don't go to existing customers. They've already been polluted with the old positioning and the old pitch. And this needs to work with a qualified prospect, so let's do it in a way it was intended. We're gonna take qualified prospects and work that new pitch with them. Usually what we'll do is a test period where after every pitch, we'll huddle and say, "What worked? What didn't work? Maybe that word is tripping people up. Maybe we need to move this slide from here to here." And so you will tune it. And then after we've done a bunch of pitches, one of two things happens. And so in, in this test structure, I am very much relying on the expertise of my best rep to know what's good. So after the best rep is comfortable with the pitch, done a bunch of pitches, we've twizzled it, at some point the rep will say, "Okay, I think we're done, you know, optimizing this pitch. And I'm not going back to the old pitch. I'm sticking with this pitch." (laughs) 'Cause I think this one works better. An experienced sales rep will know that, whether the pitch is better than the old pitch, if you give them the opportunity to feel comfortable with it, work with it a bit, and, and pitch a bunch of new prospects with it. So if the, if your best sales rep says, "Oh, this is way better than the old pitch, I can just feel it from the way people react to it, and the number of times we've been able to convert people over into actual opportunities from a first call," then what you do is, uh, at that point, I call that pass.

    10. LRLenny Rachitsky1:03:54

        Oh.

    11. ADApril Dunford1:03:54

        So then we take that rep, we can film them doing the pitch, uh, for training, and then we can take that rep, go back to the rest of the sales team, and have that rep sell everybody else on it. So that rep goes back and says, "Listen up, people. You're stupid if you're using that old pitch, which sucks. This new pitch is way better. Trust me. I'm the best rep on this whole team." (laughs)

    12. LRLenny Rachitsky1:04:16

        Mm-hmm.

    13. ADApril Dunford1:04:17

        "By the way, here's the list of deals I have cooking in the pipeline that I got using this deck. You should go do it, and I'm gonna teach you how to do it." Now I've got sales teaching sales instead of marketing sort of throwing something over the wall and crossing their fingers and saying, "Hey, I hope this works." What we should see is an immediate uplift in what happens after first call. So most of the time what that is, is we get a higher percentage of deals converting into opportunities after that first substantive calls. Th- sometimes, depending on the quality of the pipeline we had coming in, we're actually disqualifying more, but sometimes that's a good thing. (laughs) But what we should see is an immediate uptick in stuff coming into the pipeline. It's a neat trick to pull when it like... Like especially right now when everybody's budgets are really tight and you're just trying to squeeze more juice out of the lemon. It's a really easy way to get some more juice out of the pipeline, is just go in, tighten up your positioning, tighten up that sales pitch. And we can have instant impact with that, 'cause we can roll that out in a couple of weeks and, and start getting better deals flowing through the pipeline because these customers are understanding your value better, understanding why to pick you better. It's just easy low-hanging fruit to do when it, when the economy's bad.

21. 1:05:32 – 1:06:50

    General timeline for positioning and pitch creation

    1. LRLenny Rachitsky1:05:32

       To give people a sense of maybe how easy that might be, how long would you suggest people spend on maybe tweaking their positioning? And then also on this pilot, like how much total time could, could it take to potentially significantly increase sales?

    2. ADApril Dunford1:05:45

       Yeah. So in the... The customers that I work with, when we do the positioning stuff, the positioning stuff takes a week. Like we're beginning and we're done in a week. Like we're all about speed on this thing. We're trying to get the thing happening fast. So we're in and out on the positioning in a week. It might take you like, it depends on the company. Like th- the bigger the company, the slower this is. But some big companies are actually quite fast and if you're motivated, it doesn't, it shouldn't take long for us to take that pitch and make it real. Then we gotta find a rep, train the rep, and then how long it takes us to test it really depends on how much deal flow you've got. So if you're working on monster deals and you don't actually get that many qualified prospects to pitch, then that might take a few weeks. But if you've got a lot of prospects coming through the door and you can get through this pre- fairly quickly. So I've had companies do it start to finish. We got new pitch out the door and people using it in two weeks. That's about as fast as you can get it done. Most folks, I would say, take about a month.

    3. LRLenny Rachitsky1:06:39

       Cool. That is very short to-

    4. ADApril Dunford1:06:40

       Sometimes you're like IBM and who knows when you'll get to it, right? But, uh, but, but most folks could get through it. If everybody's motivated, we can get it out and have it running in a month.

22. 1:06:50 – 1:08:38

    Marketing’s role in the process

    1. ADApril Dunford1:06:50

    2. LRLenny Rachitsky1:06:50

       You mentioned marketing, and earlier you said that marketing is involved in this process in some way. What's your advice on just how to involve marketing? Where they fit in?

    3. ADApril Dunford1:06:58

       Yeah. So usually marketing is gonna end up being the stewards of the positioning once the positioning is done.

    4. LRLenny Rachitsky1:07:04

       Mm-hmm.

    5. ADApril Dunford1:07:04

       So they're gonna end up being like positioning police after this, because a lot of the positioning stuff is gonna take the form of marketing things. So they're, you know, they're invested in this. So when I was the VP of marketing, I was the person that would instigate the positioning thing. Let's get everybody together and work on the positioning.... and then I would usually be the person that is driving getting the sales pitch figured out, but it's, it's me and sales and product working together. And then once the sales pitch is done, depending on whether, you know, the size of the organization and whether or not you have sales enablement or somebody inside sales that can babysit the pitch, usually me and the head of sales would work on, "Okay, this is the pitch, and this is locked down. And we're not actually gonna change this pitch until something happens that requires us to change the positioning, and then that's when we'll re-look at the pitch." So we would look at recertifying the reps every quarter on the pitch and all that kind of stuff, and that would be me in partnership, generally me in partnership with the head of sales. But it depends on how you do it. Like, I don't think it really matters who owns it. If you have a good product marketing orga- organization, good product marketing organization generally is very concerned with the positioning and the pitch and those two things sit in their purview, but depends on how you define it. I, I can't wait till you get to Airbnb, tell us how this stuff works. I mean, they're different, 'cause they're consumer, but-

    6. LRLenny Rachitsky1:08:25

       Mm-hmm.

    7. ADApril Dunford1:08:25

       ... uh, companies are arranged in all different ways. So, you know, if the, if you have product marketing, it looks one way. If you don't, it looks another way. Somebody's got to kind of be the owner of this thing though, and so we have to decide who that's going to be.

23. 1:08:38 – 1:10:39

    The impact of developing a killer sales pitch

    1. LRLenny Rachitsky1:08:38

       Just a couple more questions. One is to motivate people to do this. What kind of impact have you seen at companies that invest this time and rethink the way they pitch?

    2. ADApril Dunford1:08:48

       Well, so, you know, people don't like me talk about revenue (laughs) stuff. Usually mo- what we've seen though is, again, the immediate impact is felt in sales, and everybody's very jazzed about that, because, eh, sometimes what the worry is, is like, we've got this old positioning and they came in through the pipeline that way, you know, so they were exposed to our marketing somewhere with this old positioning, and then we hit them with the new positioning with this sales pitch, and aren't they gonna be all like, "Ooh, you moved my cheese." And usually it ends up not being a problem at all. So usually what we see immediately is an, is an uptick in what's happening in sales, and so I've had a couple of companies tell me they've doubled the number of deals that they're bringing from first sales call to opportunity just by tightening up the pitch and getting that going. I think that's not unusual. I worked at a company where we did it in-house. We, we, where I was the VP of marketing, and we, within two quarters, had doubled the revenue just by tightening up the pitch. Just tighten it up.

    3. LRLenny Rachitsky1:09:52

       Holy shit. All right.

    4. ADApril Dunford1:09:53

       Yep. Tighten it up.

    5. LRLenny Rachitsky1:09:54

       No big deal.

    6. ADApril Dunford1:09:55

       Yep.

    7. LRLenny Rachitsky1:09:55

       Okay, so...

    8. ADApril Dunford1:09:56

       It was a big shift in positioning though, I'll tell you that. (laughs)

    9. LRLenny Rachitsky1:09:59

       Mm-hmm.

    10. ADApril Dunford1:10:00

        Not small. (laughs) Most of the time, we're not doing that. Most of the time, it's a tightening, right? Like, we're not saying, "Oh, we used to be this and now we're this." Most of the time, it's a tightening. But usually, like, the pitches are so bad. I'm telling you, they're so bad that there's this low-hanging fruit there that if we could, if we could improve it even a little bit, it actually has this big impact on how much stuff survives down the pike.

    11. LRLenny Rachitsky1:10:24

        And again, if folks wanna go deep into the positioning step, your first book, Obviously Awesome, is a great guide, and our first podcast episode goes through this. Plus you have a guest post of my newsletter where you give them a quick start guide. So there's so many tools to help you through this process.

    12. ADApril Dunford1:10:38

        So many

24. 1:10:39 – 1:15:50

    Andy Raskin’s positioning framework

    1. ADApril Dunford1:10:39

       tools.

    2. LRLenny Rachitsky1:10:39

       The other thought I've had in the back of my mind as we've been chatting is a previous guest, Andy Raskin, has a different framework. Feels similar, but I know they're different. His framework starts with a shift that's happened in the world and then here's who's gonna win in the shift, here's who's gonna lose, and then he kind of goes into why this product is the best. What's your perspective on that approach versus this approach and the big differences?

    3. ADApril Dunford1:11:00

       Yeah. So, so the thing, the thing with that framework is I, I do think it works in certain conditions. But, uh, but again, I think the conditions might be kind of edgy. So there, there's a couple of things that I think are lacking in that structure for a sales pitch. So the first one is, there's actually no concept of differentiated value in that pitch, which for me is a giant miss. So in that pitch, it assumes that new is inherently valuable and old is inherently bad. And sometimes that's true. So sometimes there's just you versus the status quo, and the status quo is some terrible old thing, some legacy thing, or it's manual processes or something, and you're the only thing out there. Then you can get away with that. But most of the time, we don't have that. Like most of the time, there's multiple new ways of doing something and you just can't say, "Well, I'm the only new and the rest of you are old and bad." (laughs) So usually, I've got to thread the needle, and y- y- e- so that's the first thing. The second thing is that, like, for most companies, like if we really understood customer indecision, old is good. It's safe. (laughs) It's not risky. And, like, does anybody ever say, "No, I'm not gonna buy, I'm not gonna buy Salesforce. That's the old stuff." Like-

Episode duration: 1:30:52