How does Occam’s Razor Apply to Increasing Sales?

Recently a company president asked, “What is the fastest way to increase sales?”  I countered by asking her if she had heard of Occam’s Razor?    Of course she said, which invited me to go to the simplest answer, but first, a review of Occam’s Razor.

Occam’s Razor, attributed to William Occam, the 14th century theologian and logician Franciscan friar states that when competing hypotheses are equal in other respects, the principle recommends selection of the hypothesis that introduces the fewest assumptions and postulates the fewest entities while still sufficiently answering the question.   Simply stated, the simplest idea tends to be the best choice.   Occam's razor is phrased as pluralitas non est ponenda sine necessitate ("plurality should not be posited without necessity")i

In keeping with my thought to give her the simplest and fastest way to increase sales, my answer to the company president was that all inquiries and sales leads must be followed-up 100%.  The average follow-up varies between 5-25% for most sales organizations.   Ergo, follow-up 100% of the sales inquires and if you have been average up to this point you will get in front of 75% more buyers and close more sales.

Yes, research has shown that nurturing programs can increase the ROI for lead generation programs by 2X-3X.  If marketing jumps in with marketing automation (email and or telemarketing nurturing),in my opinion,  these count as follow-up. 

Having a CRM and Marketing Automation program are key components, no argument.  But the simplest, fastest, surest way to increase sales lies in the hands of sales management and the salespeople.  If 100% follow-up is enforced and not an option, sales will increase in 90-120 days.ii

“100% follow-up Rule:  Corporations that have a 100% inquiry follow-up policy will sell more that those that don’t.” iii

So, once again I am in agreement with William Occam, the simplest answer is usually the best.   I knew there was something about those Francisans I liked!

 

_________________________________________
  i. Wikipedia, this explanation is taken virtually verbatim from the Wikipedia definition.

  ii. Obermayer’s opinion is that, “Salespeople assume every corporate rule, procedure, request or dictate is optional until it is repeated at least three times over two months.”

  iii. James Obermayer, Managing Sales Leads: Turning Cold Prospects Into Hot Customers, (Mason, Ohio, Textere an imprint of Thomson/South-Western, 2007), and Racom Books, Page 15.  To order go to Racom.

Comments

[Jim LaBelle]

I must admit that until 5 minutes ago I wasn't familiar with Occam's Razor but am suitably impressed with your knowledge of 14th century theology. 100% follow up is not only the quickest way to increase sales but the cheapest. A change in the attitude of sales management to make inquiry follow up an imperative doesn't have to cost a thing. Although there are a number of affordable tools (like LEADTRACK)on the market -an immediate increase in sales can result from nothing more than a change in attitude. Sales leads are important but tracking and follow up are critical. Work those leads and succeed!

[Ken Krogue]

We find on average after three different research studies (Omniture Summit 2007, Dreamforce '08, Dreamforce '09) that only about 45% of leads every get followed up on. Your policy would more than double sales.

[jamie campbell]

Occam's Razor is new to me but makes complete sense. Following up will increase sales. By having a CRM system, and a database of contacts/compnies/socialmarketing/linkedin. (salesfuel.com) will also help sales staff close deals.

[James Obermayer]

You're right Jim. An increase in sales can immediately result from an attitude change that lead follow-up is an option. It cost the company nothing. At the opposite side, only 25% follow-up means they are not getting the opportunity to sell to 75% of the buyers. It is wasting 75% of the company asset called the investment in marketing. Marketing ROI can increase by 75% if the leads are followed-up to a closed sale, or closed lost condition. But none of this is known, one way or the other if a CRM or Marketing Automation tool are not employed.

[yellow bullet with ephedra 100]

But when does following up get annoying? I guess if you keep trying I will eventually respond though..even if it's to tell someone to stop contacting me.