Sound business marketers place a great deal of emphasis on targeting the audience with whom they wish to attract. It makes sense, because why spend your advertising budget on an inappropriate clientele?
Following that logic, shouldn’t they be just as selective in deciding whom they chose to do business with? For new business development, as well as a great many other facets of business, being selective in choosing whom to work with can be a good thing. Should an SMB take on every new client?
Definitely not! You need to think beyond just selling, and remember that you are entering into a relationship. Such a situation must be based on mutual respect and a large dose of reality.
As the owner of a small business, you understand that your company’s bandwidth, and especially your time, are finite. In our agency, we refer to bandwidth as the amount of projects we can effectively take on while maintaining a high standard of quality in the end product or service. If we take on too many projects, or overstretch our bandwidth, the quality suffers of our deliverable diminishes and we miss important deadlines. So, should you take on every new client?
We do not. If we take on a client who is overly difficult to please, or constantly changes the rules of the game (and robs us of time, talent and treasure) our overall business will suffer. So would yours…
The mindset of many businesses, especially newer businesses, have inexperienced managers or owners, or a small business that is startup mode, is any order is a good order. Closing a sale means additional revenue and the pressure to deliver more revenue affects their behavior, rivaling desperation sometimes. Merely closing the sale without regard to both the customer’s best interests and the impact on your company is a poor way to run a business. It is understandable that a business needs a steady stream of new customers, but not everyone that seeks your expertise may be the right fit for your long term success.
With this in mind, it has become part of our sales process, specifically within our qualification process and lead scoring, to ask ourselves: Is this customer going to be a good fit for our culture and long term success? And we evaluate every prospect with this mindset. Here is why…
Your business is only as strong as the clientele you work with. Future referrals, new projects, and consultations that come from the right customers are golden and often cost less in terms of marketing expenditure. When you have a loyal customer, the referrals and positive PR your company will receive is far too valuable to ignore. Additionally, an existing, highly valued customer is far less expensive to service compared with one that creates chaos.
Conversely, when a customer seems to be irrational, impulsive or disregards your professional opinion, the turmoil and stress level of your organization will suffer unnecessarily. Your productivity and output quality will suffer greatly. And you risk having this impact your existing customer relationships as well.
Is there really any pain?
As I proceed through the sales process, and assuming I have converted a suspect into a prospect, I follow a guideline of 20 questions to help me identify three vitally important points:
- Do they really have pain? No one will buy into your pitch without it.
- Do they have a budget, and are they willing to put it in play? It is futile if the customer cannot afford the right solutions.
- Are they the type of customer you really want to work with? Do the two of you match up with the right ethics, behaviors, and value systems?
Too often sales people don’t view the meeting as an opportunity to be the solution to a customer’s pain. Their focus, and their purpose for the meeting, is simply to close a sale. This is a primitive mentality, and as a result the possibility for a new found relationship diminishes because the sales person is actually taking the customer for granted. In this scenario, neither party really wins. Mutual respect is the foundation for a relationship that will last.
I prefer to view such a meeting as an interview, with both parties evaluating each other. At the end of the meeting we should both have sufficient facts and the right level of comfort to decide if we mutually want to continue the conversation beyond this meeting.
Why do I approach an initial prospect meeting in this manner?
The reputation of my marketing agency was built on delivering quality and value; we are a small merry band of professionals, our bandwidth is extremely limited and we all believe that our ability to execute projects and deliver our standard of excellence must never be jeopardized. Okay, sometimes it has to be, but fortunately that is the exception and not the rule. Therefore, it’s imperative that we make the right decision when taking on a new client, and not rush into them.
Also, when parties are evaluating each other, both the customer and the business must agree to follow a specific course of action, defining and measuring success as they go. Unfortunately, there are too many small business owners who won’t do what really needs to be done to achieve success. They talk the talk, but don’t always walk the walk. It may be a prerogative of ownership to play the back nine three times each week. After all, who is going to fire you? But it does strain the relationship with your marketing agency who is looking for your contributions, execution, communication and feedback.
In the past, we have taken on a client whose behavioral style needed super high maintenance or possessed a personality that was contrary to our culture (ever have a client that could suck the air out of the room when they entered it?). These personalities require immense amounts of care and feeding and they don’t care that it deprives other customers of your time and talent. Or that it negatively impacts the creativity of your team. And too much of the time, their “needs” are the result of irresponsible, poor leadership, or a lack of time management skills.
The 20 Questions…
Obviously there will be industries outside your expertise or geographic considerations that have to be a match, but for this article let’s assume these are not a factor. Now you have a meeting with a prospect and need to conduct the “interview”. Here are the questions I bring to our initial meetings. I try to always get through all of them, and always in this order.
1) Tell me about your business:
a. Age of company
b. Products & Services
c. Number of employees
d. Annual sales volume (If they cannot answer this, run away!)
e. Current year over year trend
2) Tell me about your ideal customer?
3) Who is your largest client or customer? (Again, if they cannot answer this, run away!)
4) How did you become involved in the business? (Or why did you go into business?)
5) Are there any cash flow issues?
6) What are the primary strengths and major weaknesses of your company?
7) Tell me about your personal goals. (Income, net worth, time, vacation, retirement)
8) What do you like about this business? What don’t you like about your business?
9) Do you have a mission statement? May I see it (or where would I see it?)
10) Do you have a vision for your business?
11) Why would I do business with you vs. your competitor?
12) What motivated you to explore the value of outsourcing your marketing?
13) Who in your organization handles the marketing planning and execution?
14) May I see your current season’s marketing plan?
15) How do you market to new customers?
16) How do maintain engagement with your present customers?
17) Can you show me examples of the current years’ marketing campaigns?
18) Can you show me the performance analysis of these campaigns?
19) When did you last update your corporate identity (logo, business cards, brochure, etc.)?
20) Do you have a sales person(s)? How are they managed?
Managed properly, and assuming there is real pain, this “interview” will reinforce the need of your services and position you as a leader in providing a solution. It will also help you gauge their level of business acumen, their knowledge and approach to marketing, and what services may best benefit their situation. You can score their responses on the page (using numbers or alpha).
Following this process also takes away any bias on your part. Every prospect gets the identical evaluation.
Make it your own
There is a colleague that we often collaborate with who also uses this process, and he has developed a clever checklist to use with the 20 questions list. When a keyword is spoken, he checks the appropriate box. The more boxes checked, the more pain they have. It looks something like this:
Lessons Learned Over Time
Admittedly, I have entered into relationships with customers that later I wished I hadn’t. Just as in life, neither customers, nor businesses need to rush into a relationship. The process justifies taking your time. Life is far too short to enter into an arrangement of any kind that is acrimonious. I do everything I can to ensure that my relationship with my clients is as good in 1, 2 or 5 years down the road as it was when we first met. But for certain people that may prove difficult, others impossible. That is why you must be selective in choosing whom you’ll work with.
In coaching the sales team members of our clients I stress taking this perspective seriously and to always consider the long-term effects of their decisions when taking on a client or customer. Decisions based on just “signing the next customer” often backfire. The excitement of identifying a solution and possibly achieving their sales targets should not be the only criteria on which to base a contract decision.
So, should you take on every new client?
Jill Konrath, a superb, well-known sales training coach, has a great saying: “Curb Your Enthusiasm”. Instead, allow the emotion to be displaced by logic, while focusing on the long term potential result of the decision being made and your business will thrive as a result. Jill knows from her own experience that if you are selling to solve your problem (quotas, quarter end pressure, etc.) it is not only obvious to your client, but a huge turn off. Likewise, taking on a high maintenance client can put your company at risk, so learn to be selective in deciding where to allocate your team’s bandwidth.