Did the Warriors land superstar Kevin Durant because of a last minute call by Jerry West, and chess-like player moves to make room in the salary cap? Contrary to popular reports, no. The Warriors spent years running a methodical,business-development-like process that won the trust of Kevin Durant. A closer look at the facts reveal ten lessons anyone looking to close a game-changing deal can learn from the Warriors’ successful approach.
1. Build a long term relationship. Big deals take time. Curry’s relationship with Durant started in 2010 at the FIBA World Championship — a tournament where Curry, Durant, and Iguodala became immediate friends. Further, Curry and Durant bonded over chapel services. Those were the seeds of familiarity and trust that grew into years-long friendship. In the same way, don’t expect a big corporate deal to happen overnight. Take the time now to develop the relationships you’ll need down the road.
2. Be ready for the process.Big enterprise deals are often kicked off with a request for proposals. Have discussions, get insider information, and if you can even advice on what should be in your bid. In the NBA, the free-agency process starts on July 1st. The Warriors prepared by clearing salary cap and making important trades.. Further, because of their friendship, Curry knew that KD was looking for in a new home.
3. Use team sales tactics. Large partnerships often need a wide span of approvals within the buying organization, from integration engineers to the CEO. One sales person cannot do all the work or have the right knowledge to speak to everyone in the client’s organization. Bring your team to help sell. Engineers speak engineering. Product speaks productization. CEOs talk about what wine they drink. The Warriors brought Curry, Green, Thompson, Iguodala, Kerr, and Myers. Each played a different role in the discussion.
4. Be authentic in the sales pitch.Tell the customer where your product wins and don’t be afraid to mention where it may be weak vis-a-vis others. Honesty builds trust. The Warriors gave an honest perspective of the team approach intertwined with light hearted jokes about Klay Thompson taking fewer shots. It was authentic. The Clippers pitched an aggressive “Fabulous 4”package with LA flare.
KD said it himself: “When I met these guys, I felt as comfortable as I ever felt. And it was organic. It was authentic. It was real. And it was feelings I couldn’t ignore.”
5. Structure a flexible and simple deal: Big companies often want flexibility until the partnership is proven. This can be done by structuring a 1 year deal or an easy contract termination clause. Durant wanted a 1 plus 1 deal so he could possibly be paid more after the next two years or find a potential NBA champion to join. Flexibility was very important to him. The Clippers wanted at least a 4-year deal, as did the Celtics.
6. Sell on product not on price.The best product even at a slightly higher price than others often wins. If you sell at marginal cost, the other company may wonder why you are so desperate. Stay firm on price with clear logic to back it up. The Warriors showed Durant they had the best team, the best system and best executives. They stayed firm on their offer.
7. Sell a future. Big companies want to know there’s a future plan. Even if this is not entirely true, create excitement about how the partnership could evolve. Warriors sold Durant on a life after basketball with technology, music, and virtual reality.
8. Develop backchannel communication. Have someone at your company build a relationship with the other company to communicate about the deal. Curry was texting KD about the team culture, winning, and being on the same page while agents, team executives and lawyers handled the official communications.
9. Have a wild card to play if the deal goes awry. This could be in the form of an investor or CEO who makes a call to the other company’s CEO to keep the deal on track. On July 3, it seemed KD would remain with OKC. ThenJerry West called KD which may have pushed him to the Warriors.
10. Don’t sell past the close Don’t oversell or exaggerate after the client has indicated they like you. Many sales people make the mistake to keep driving the nail in the coffin. This will only lead to a potential back step. The Warriors stopped selling after the West call. They knew that it was enough. It was time for KD to make a call. And he did just that.
While at Boku, we used many of these tactics to close game-changing deals.