A look at SALES THEORY with Bob Moesta

I was lucky enough to have 27 years 4 hours a quarter with Clay. One of the things that we would talk about, and back in 2010 we started talking about this, is like, why are there so few sales professors? And having done 7 startups and kind of gone through and done all these different things, I realized like sales is the hardest part of any business. How do you go to business school and not have a class in sales? And if it was, it was about compensation or it was about kind of the the, the sales funnel, but it was like there's no real understanding of how to sell. And so we kind of pulled that thread and started to do some research, and we realized that like there's— it's startup schools like, you know, Y Combinator and Techstars, very little focus on sales. And, and kind of our conclusion was the fact that there's really no quote theory around sales. It's just very straightforward. It's about the product and it's about basically people buying, and you know, it— there's no need to actually have education in it. And To be honest, it just didn't make any sense. It's all practice and no theory. One of the quotes we've dug up from 1950 really was from Peter Drucker. He says that people in business think they know— what they think they know about the customer is more wrong than right, and that they rarely know why the customer buys. So at some point in time, why they buy their product. And so this is the thread we pulled, and to be honest, to this day it's still true. Instead of focusing on sales, how do we focus on how people buy? You know, so let me tell you a quick story, right? It's at some point like, uh, 2005, 2006. My kids are, are playing soccer, playing hockey, playing baseball, all those kinds of things. And it turns out that every time I do a photograph, it'd turn out blurry like this. And it would be like, I, it might be, I might take 100 shots and maybe one was good, but it was like all this work to figure that out. And so eventually, you know, my wife and I had the conversation. She's like, we, you know, we either can pay for the photographs we get from the from the, you know, the tournaments we go to, or we can get a camera. And I'm like, oh, I want to get a camera. And so I start down the rabbit hole, right? And when you start to look at things, you start to realize at some point there's so many different features. So I just took the number one camera company that I knew of was Canon. And I looked at one of the Canons and all of a sudden it started to talk all the features. And I'm like, what is an f-stop? And what is the megapixels? And what is, you know, shutter speed? And what's the focal length? All these different things were just so hard. to basically figure out. But finally I figured out, and then as I started to look and say, well, what else is there? All of a sudden I realized there's competitors like Sony, and all of a sudden they're just so complicated. And it's literally like, like, I'm so stupid as a customer that I can't like choose this thing. And so I literally had spent hours and, you know, many trips to figure it out and talking to people who had cameras. So we were at tournaments, I talked to parents who had cameras, but it's a very large education. And finally I get to the point where I buy one. Right? And I, I, the salesperson was very, very helpful, but then they told me like, well, we can get you the cameras onto it. We can get the photos out of the camera, but if you want to do something with them, you have to actually have software. I'm like, what? And all of a sudden it's like I had to learn Photoshop. And there were some other ones you could have used, but ultimately I, I, you know, if I wanted to get the best pictures, I had to actually do it that way. And so ultimately I had to go learn Adobe as well and got that done. And so what I want to highlight here is the difference between, or the gap between what I call the product side or the supply side of the world and the demand side of the world. They made me come over to their side, learn all about their products, figure out how to do it, and it literally was so inconvenient. And to be honest, eventually I bought one and I used it, but it was like, it was a lot of work, right? And at some point in time, not everybody had the time and not everybody had the money to go do that. And so in walks Apple. And you think about Apple, was Apple, you know, the first iPhone had a camera, but it wasn't very good. And ultimately, you start to realize the most— the best camera is the camera with you. All right? And so you start to realize that as Apple kind of walked into this, they didn't want to be in the camera business, but they ended up being in the camera business. And oh, by the way, they didn't teach me about f-stop. They didn't teach me about any of those things. They made me look like a great photographer. And oh, by the way, they included the software. And so ultimately, they just made it easy for me not to take good pictures, but for me to be a good photographer. And ultimately, the fact is, the crazy part is that if you look at the number of pictures that have been taken over the years, it's almost, you know, 100,000x'd. You know, we're at a— you know, 2019 is the number I have. 1.2 trillion pictures were taken. But if you look at cameras, right, the camera industry— Nikon, Canon, Hasselblad, Fuji, all these people— in 2010, they sold 121 million units, and by 2018, they were off 80% and down to $19 million. And so this is one of those things where disruption happens because at some point in time we don't have that fit between what we're selling and what customers really want. And that if you think about it, what happened was really the fact that the camera companies started competing with each other as opposed to competing with the customer. They end up creating all these new features and as the features got piled on each other, it made it so sophisticated that at some point people just dropped out because it was too much. And so they end up being at the very high end of the market and not being able to actually understand what was happening at the low end of the market where Apple walked in and kind of killed it. And so part of this is being able to understand what we call the difference between the supply side of the world and the demand side of the world, and that it's about product-market fit. And ultimately, we— I need to be able to make sure the product is designed in a way that, that actually helps solve or helps people make progress in their life. And so the big division is this lie I was told was I was told build it and they will come. And the reality is like, it's just not true. And the supply side is really about this aspect of being able to, you know, what we can build. It's like as an engineer, it's just amazing. Like that's to be where I grew up. But the demand side is what causes people to say today's the day I'm gonna literally get rid of my old camera or even not have a camera and buy a new camera. Those 2 worlds are actually divided by this big wall. I call it the product-market disconnect. And ultimately it's because at some point we're looking at masses of people. So think of it this way is, you know, we all kind of know the business, the supply side of the world. There's a business system that has inputs and it creates a product or a service. And those products and services have features and benefits and experiences and attributes. And ultimately we build out kind of a process or a way in which to help people, right? But what we do is we go to that wall, and when we get to the wall, we basically climb up that wall and look over the wall. And when we look over the wall, the reality is we see markets and segments and personas and prospects and leads, but we see it as an aggregate of things as opposed to basically separate things. And so what happens over time is the reality is like what causes somebody to say, today's the day I need a new camera, or to be honest, I worked with a With a company that made mattresses, what causes people to say, today's the day I need a new mattress? The key here is the struggling moment is the seed for all innovation. Wherever somebody struggles is where people start to realize they can do better or want to do better. And if you don't struggle— like, when you struggle, you care and you want to do better. That's why it's called the struggling moment. And so ultimately, when you look at the demand side of the world, it's actually a very, very different set of systems. It's they have a current product or a current— they're doing something, right? And even doing nothing is doing something. And then there's some context that overlays their life that creates the struggling moment. And that struggling moment creates the space in the brain for them to kind of realize like, okay, I gotta do something different. And then they start to consider basically what are the new outcomes that they want? And what am I trying to achieve? And so they have that struggling moment and kind of that outcome that they're thinking about. And ultimately, they look at candidates, and there's usually never any product that fits them so well. And so what happens is they have to look at what they call hire and fire criteria. Yeah, I like that one. Oh, maybe not that one. And they start to make trade-offs. And ultimately, they climb that wall and look over and look at companies, brands, and products, but they don't know how it works. And so part of this is that what's happening is more and more people can assess their situation, but they can't actually understand all the intricacies of kind of how the product works. And we keep trying to pull people to, to our product as opposed to help them make progress. And that's what demand sales is all about. It's the whole aspect of looking at the demand side first and understanding how people buy so we can then set up the way we should sell. Because most people approach it by saying, here's the product, the product can do these things, there's a billion people who can do this and all, or who want this, And ultimately, what's the best way to sell to a billion people? Versus, here are people in these struggling moments, how do we target these struggling moments and enable people to make the progress so they can value the product? It's very, very different. And so I wrote this book called Demand-Side Sales primarily to really help people realize that the fact is, is that we all sell, we all convince people, or we all help people make progress. And ultimately, we want to be able to understand You know, what, what are those forces? What are those things that are at play to do that? And so what, what, what I'm proposing is to think about your sales process not as a sales process but as a buying process, and to be able to structure it to understand how people struggle along the way to make progress and what are the decisions they have to make. And ultimately, those things along the way, we're trying to flip the lens from we have a product, what To then who, when, where, why, how, and how much. And what I'm saying is that a better way to look at this is to start with who, you know, basically the progress they're trying to make in the struggling moment, which is progress, which is who, when, where, and why tells me what, how, and how much. As an engineer, I always want to over-engineer everything. I want to make it perfect. I want to make sure it never fails. And what you realize is you never have enough time or money to do that. And understanding progress is, is at the core of this thing. So when we start to look at this, what we want to do is compare and contrast the whole notion of basically what I call the sales process, right, and ultimately the buying process. And we're better off trying to actually help people understand where they're at in the buying process as opposed to where they are in our sales process. They don't really care about our sales process. They care about how to buy. And the more we can educate people on how to buy, We'll actually sell more. And so it's like, to get sales, don't focus on sales, focus on progress.