A VC in Vacationland

Does your potential customer think with their head, their heart or their gut?

I was reminded of this very useful piece of consulting lore recently.  I guess it had become so ingrained in me that I never thought of it any more, putting it in action automatically.

The story is as follows: people generally think with their head, heart or gut. Head thinkers like rational explanations and lots of empirical evidence. Heart thinkers are convinced by emotional appeals.  Gut thinkers are common sense kind of people who act if they feel something is right.

These three attributes describe many, if not most, of the people you will deal with on a daily basis.  Taking the time up front in a business dealing to try and determine how people make decisions will allow you to better focus your arguments around things that help people make decisions.

For the "head types", use carefully defined steps, such as "premise, evidence, conclusion" to make your argument. For example, VC’s like to portray themselves as rational buyers, but often succumb to the other two types of decision making. Head types at a customer are the ones asking for a lot of proof that your solutions will save them the money as promised.

For the "heart types", focus on appealing to their emotions, such as "this will help you do the right things for your customers" or "this will help you get lower prices from your suppliers". Heart types are easily recognized in a meeting as the ones who ask the hypothetical questions about whether something is good for the company.

For the "gut types", the best strategy is to have a good case example, such as "The Wal-Mart guys are going to require RFID on our case packs within the year". No arguments there for the gut decision makers to argue about.  Be careful of these guys, though. They normally have only a few hot buttons around a buy and you better find them, or you will not get their vote.

What does this mean for entrepreneurs?  Besides figuring out the personality type of your customers, the reality is that a good entrepreneur is able to shift among these styles in a presentation to be sure all decision makers in the room are convinced that this is the right thing to do.  Pitching to only one type of decision makers is a recipe for failure, as your meeting will likely contain all three.

I admit that I have been known to shift allegiances around decision types in a meeting to see if a presenter was aware of the different types of people in a room. It is a good way to determine if your potential entrepreneur is capable of addressing a wide range of concerns in their upcoming presentations to customers. It is also a great way to test sales people before you hire them.