26 June 2009 1 Comment

What to Do When You Need Sales Fast : Issue 1 of the Outside In Newsletter

I’m proud to announce the launch of the Outside In Newsletter.

It features articles, hints, tips and news to help partners, marketers and business developers in Professional Service Firms to attract more clients and win more new business.

Every month (usually on the 3rd week) I’ll be sending out a new edition featuring a detailed article on Marketing & Business Development for Professional Firms.

This month’s feature is highly topical: What To Do When You Need Sales Fast.

In the current economic climate, many professional firms are facing the challenge of bringing in new business in a very short space of time – for example, to replace the lost revenue of a major client who has stopped buying, or to “fill the gap” when engagements are delayed. In some cases it’s a “do or die” situation – they need to chalk up new sales in a month or two or face layoffs or worse.

Unfortunately, for professional service firms, accelerating sales is not simply a matter of running a campaign or pushing the partners and business developers harder. The lead time for a sale is usually much more dependent on the client’s timetable than the professional’s – and pushing too hard, too fast can very often backfire.

However, there are ways of generating sales in short timeframes – if you have a strong understanding of the key sales drivers. Not all the strategies will work for every profession or for every client – but each is worthy of strong consideration.

Firstly, you must focus on clients who already trust you and believe in your capabilities.

Secondly, you must package and position your services to make them easy to buy.

Finally, you must reduce “friction” in the buying process.

To read the full article with details on each area and other tips subscribe to Outside In by entering your Name and Email address in the sign-up box at the top right of this page – or by going directly to the Outside In Sign-up Page.

Filed Under: Marketing Professional Services Tagged With:
20 June 2009 1 Comment

How to Get More Referrals Using Offers

Referral OfferOne of the biggest challenges I find clients have when trying to get more referrals is that their referrers (the people they’ve asked to introduce them to someone) struggle to make the introduction sound attractive to the potential client.

For example, let’s say you’re an employment lawyer and you’ve asked an accountant to introduce you to small manufacturing businesses in your area. Or perhaps you’ve been smart and used Linkedin to name some specific people and organisations you know he knows.

How is he going to make that introduction sound attractive to the potential client? Chances are they don’t have a specific need for your services at this point in time. And even if they did, the accountant might not know that. So although a recommendation and offer of an introduction from a trusted partner like an accountant is more likely to succeeed than a cold call – it still might not seem attractive.

And it may also be embarrassing or uncomfortable to the accountant too. It may feel a little too much like he’s simply selling for you with no real benefit for his client.

Now of course, you’re going to try to inspire your referral partner by demonstrating what a great resource to his clients you’re going to be. And of course, you’re going to be “courting” that referral partner to keep yourself top of mind for when the time comes to give recommendations.

But still, 1-on-1 with his client he’s going to have to pop the question. So maybe he’ll wait until the client’s in a good mood. Or maybe until a related topic comes up. Or maybe….

But what if the accountant had something to offer the client on your behalf? Something that was valuable to them without relying on them having an immediate need. Perhaps a report you’d prepared on the key facts manufacturers need to know about employment law, perhaps an invitation to a monthly seminar and Q&A session your firm runs on new legislation which impacts small firms, perhaps some kind of related checklist or spreadsheet tool.

Then there’s no embarrassment or difficulty. The accountant will feel they’re adding direct and immediate value to their client. They’re not just suggesting a meeting with you which might lead to value for the client – they’re giving it straight away. And the client will feel much more disposed to meet with you and much more confident that you’re going to be a useful resource.

The whole situation has changed from the referral partner doing you a favour – to them doing themselves a favour.

So not only will the accountant be recommending you when the time is right and when the client’s in a good mood – since your offer adds value to his clients, he’ll be recommending you whenever he can to get “brownie points” with them. He’ll be actively looking for opportunities to make recommendations and raise the status of his relationship.

So what resources do you have that your referral partners can offer?

If you don’t have any, start working on them now.

Filed Under: Marketing Professional Services Tagged With:
17 June 2009 Leave a Comment

The Referral Formula

ReferralsThis is the second in a series of posts on how Professional Firms can get more referrals. Read the first in the series – Referrals: You’ve Got to Have A System

To some degree, succeeding with referrals is something of a numbers game. More referrals equals more business. However, for busy professionals who need to balance business development with billable hours, it’s rarely wise to sacrifice quality for quantity. Better to go for a smaller number of high probability referrals and devote enough time to convert them to sales.

So what makes a high quality referral?

Referrals work because of transferred trust. Obviously I am going to put more credence in a recommendation from a colleague or business partner I know and trust and who I know has experience in the area than from a casual acquaintance or someone I bumped into at a networking event (although it’s surprising how much credence we do give to those more distant referrals). The higher the level of credibility of the referrer, the higher the quality of the referral.

In addition, the level of endorsement we get in a referral can be crucial. This is why referrals from clients can be so valuable. Referrals from clients are more credible because they have actually experienced our work. And if we have performed exceptionally well the referral will be much more complimentary than a referral from business partners who know us but have never worked with us ever could ever be.

Finally, a high quality referral is a targeted referral. We are far more likely to get a sale from a prospect who we know needs our services right now and has the budget to pay for them than from a random, unqualified “name and number”. This is one of the frequently overlooked strengths of referrals. In many professional service businesses, client needs are often difficult to detect from the professionals perspective. Businesses considering a takeover don’t like to make their intentions public by announcing they’re looking for M&A advisors. Couples with marital problems try to show a united face in front of strangers. Companies planning to make major layoffs and needing HR and employment law advice rarely want the news to leak out until after they’ve had that advice. As a result consultants, lawyers and other professionals rarely see these opportunities on their radar screens until it’s too late. However, an insider or current advisor in frequent contact is often alerted to these opportunities well in advance. That’s why accountants, who are in frequent contact with their client businesses, are such sought-after partners by lawyers and other professionals. They can give highly targeted referrals to clients with pressing needs.

Putting all that together gives us what I call the “Referral Formula” – a simple guide to the key areas professionals should work on to maximise the value they get from referrals:

Referral = Number of x Potential of x Credibility of x Strength of
 Value     Referrals     Prospect        Referrer      Endorsement

Future posts will go into more details on specific aspects of generating more referrals

Filed Under: Marketing Professional Services Tagged With: ,
16 June 2009 Leave a Comment

Keep out of the “Muddy Middle” when Selling Professional Services

The dangers of a "muddy middle"For many decades, perhaps the most successful client development strategy for both professional service firms and individual professionals has been one of focusing on a small number of high value clients.

As Andrew Sobel points out in “All For One”, a consultant or accountant only needs a handful of good clients to make a great career. And most successful professionals will maintain around 15 to 20 truly important client relationship over their business life.

Building a small number of deep, trusting relationships pays off much more than having shallower relationships with a broader group because there’s a very high probability of converting each prospect into a client.

However, more recently, an alternative strategy has emerged. Fuelled by the ability of technology to allow relationships to be developed with large numbers of people via email newsletters, contact management software, Linkedin and other networks.

This strategy focuses on developing a very large number of shallow relationships: people who know of you, who have read your material, who may have interacted briefly via email. But not people you know very well.

This strategy pays off because – thanks to the efficiencies of the technology – very large numbers of people can be interacted with to a much deeper level than was ever possible before – and at almost zero cost. Someone who receives your email newsletter and who occasionally asks you a question on a forum is not a deep relationship – but it’s much deeper than the non-existent relationship you would have had historically before the advent of technology. Even though the conversion of prospect to client is much, much lower than for deep relationship – it works because of the law of large numbers. A 5% conversion rate when you have only 20 potential customer will not lead to much business. A 5% conversion rate on an email list of 20,000 is pretty impressive. And it can open up your services to a global market (provided you can deliver globally)

Now obviously, different strategies work best in different situations. It’s of no real value for an HR consultant focusing on clients around Birmingham to have a huge global email list of 30,000 prospects if hardly any of them are in her core market.

Conversely, it’s highly risky to focus on a handful of prospects if you have a small one-off service to deliver which can’t be repeated for the same client.

But as long as you find a good fit between your target market and your strategy (and also your own preferences and skills), then either of the strategies can be highly effective. And it’s perfectly possible – even desirable – to run both in parallel. And the “broad net” approach can often identify high potential candidates to enter the “in-depth nurture” approach.

But where the problems occur is when you get stuck in the “muddy middle”. Where you build only shallow relationships – but with a small-ish number of people. This can happen in one of two ways:

  • A professional focusing on the in-depth nurturing approach can allow his target client list to expand too much and end up diluting his efforts with his real high potential clients.
  • A professional pursuing the broad big-numbers approach may fail to build his contact list enough – and as a result the low conversion rate combined with a small prospect list will mean he wins little business.

How can you avoid these mistakes? Make sure that in your marketing plan you have separate plans for each of these strategies. Make sure you are doing what’s needed to make each strategy succeed.

The nurture strategy requires you to identify clearly your very high potential prospects then work diligently to make yourself as attractive to them as possible and to interact with them as much as possible.

The broad big numbers strategy requires that you build a large, targeted list and that you tailor your marketing messages to the segments in the list.

Do either or both of these strategies well and you will be on your way to having a growing and profitable practice.

But whatever you do, don’t get stuck in the muddy middle.

Filed Under: Business Development Strategy Tagged With:
15 June 2009 1 Comment

Creating a Marketing Habit in 21 Days

Creating a Marketing Habit in 21 DaysPaula Black has just published The Little Black Book: A Lawyer’s Guide To Creating A Marketing Habit in 21 Days.

Having got my hands on a pre-release copy, I can say that not only is the book beautifully produced (the sort you’ll want to keep flipping open and dipping in to) but it’s filled with the sort of practical hints that can really help ingrain a marketing mindset.

And as I’ve repeatedly written, the key differentiator between successful Rainmakers and “also rans” is that Rainmakers have a repeatable business development system. Sometimes it’s unconscious – they just get on and “do their thing” when needed. But a great many highly successful business developers have developed their skills and their “system” consciously. This book is a great way to do that for yourself. It’s not a book of heavy theory or completely new ideas. Just practical tips and advice – the “blocking & tackling” we all need to do become effective marketers.

The first part of the book is a day-by-day activity guide to ingrain client-focused marketing habits into your psyche. The second is a guide to developing a marketing plan, focused on your current and former clients, marketing within your firm, and marketing by joining organisations. the final part is a series of marketing “pearls of wisdom” from successful lawyers.

48 Hour Deal: 34 Free Gifts for Purchasers of the Book

For the next 48 hours, Paula is running a special deal where anyone who buys her book via the Law Marketing Portal can claim “The Smart Layer’s Toolkit” – 34 ebooks, free subscriptions, podcasts and other gifts.

Among the contributers to this are:

  • Larry Bodine on “Thinking Like a Rainmaker”
  • Josh Fruchter on “The Top Ten Law Firm Website SEO Best Practices”
  • Julie Fleming on “The Reluctant Rainmaker: A Guide for Lawyers Who Hate Selling”
  • Patrick J McKenna on “Getting Unbeatable Testimonials”
  • Paramjit Mahli on “How To Grow Your Law Practice on a Shoestring Budget…Media Relations”
  • David Barret on “Social Media for Lawyers”
  • and a contribution from myself: “Building Your Client Base Through Referrals”

Go to Paula’s Law Marketing site to order and get the free gifts.

Filed Under: Business Development Mindset Tagged With: , ,
13 June 2009 5 Comments

Referrals: You’ve got to have a System

Referral PartnershipsWe all know that referrals can be the most powerful and profitable source of new clients. Yet most of us find that we’re simply not generating enough referrals of a high enough quality to reach our practice growth objectives.

What’s the problem here? Are we mistaken in our assumption that referrals are such an effective business development method? Or is it an execution issue – we’re simply not going about it in the right way?

For most professionals it’s a bit of both. While all the evidence highlights that our clients rely on referrals as their most trusted source of information on new suppliers; we must remember that not all referrals are created equal. Unfortunately, some referrals can be little better than random cold calls – a name and number we’re given of someone who may or may not need our services, may or may not be able to afford them, and may or may not see the referrer as a credible and trusted source. It’s our ability as professionals to work with our clients and partners to deliver the quality – not just the quantity – of referrals that will make all the difference to our success.

Do Referrals Work?

“Referrals from Colleagues” and “Referrals from Other Service Providers” were identified as the #1 and #2 method used by buyers of professional services to identify and learn more about providers in the 2009 RainToday.com Benchmarking Study “How Clients Buy”.

Because of the complex and intangible nature of professional services, buyers look for help to assess two critical criteria for selection: “Can the provider do the job?” and “Can I work with them?” They take clues from their personal interactions with the providers (at seminars, presentations and sales meetings) and from the experiences of people they know and trust. And despite the increasing prevalence of online “relationships”, the people they turn to for recommendations are their colleagues and other service providers they have worked closely with. In other words: people whose judgement they respect.

For infrequent or “distress” purchases (for example, many legal and consulting services) – services bought because of an immediate or unexpected need; the reliance on trusted third parties increases. Buyers won’t invest in building a relationship up front with a provider of services they don’t know they’ll ever need – so instead, they rely heavily on the opinions of those they trust with experience themselves.

So do referrals work? The answer is a resounding “Yes” – if done correctly.

You’ve Got to Have a System

In his classic work Creating Rainmakers, Ford Harding highlights that although successful business developers are very diverse in terms of background, personality, style and approach – they all share one common factor: they all have a “system” for generating business. That system may be hugely different between Rainmakers, with one relying on networking, another on cold calling, another on writing and speaking. But all had developed a method which worked for them which they could employ repeatedly and effectively without having to think from scratch of what to do. When needed, they were able to “switch on” their system and carry out the steps which would bring them more business. In contrast, less effective business developers either tried to “wing it”, or had to spend so much time reinventing a system – gathering contact details, developing a script, identifying networking meetings, or writing an article – that the opportunity was lost.

It’s the same with referrals. Although we all know how powerful referrals can be, how many of us take a systematic approach to generating them?

Professional firms wouldn’t dream of investing marketing budgets and non-billable time into advertising, speaking campaigns, seminars, website development or thought leadership without a thorough analysis and plan for how that investment would pay off. Good marketing plans identify target clients for each approach, refine the firm’s positioning and specify the messaging to be used. They identify clear objectives for each area and the sequence of activities and critical success factors necessary to achieve those objectives. They carefully allocate non-billable hours and budget to each activity to try to maximise the overall returns.

Yet when it comes to referrals – potentially the most powerful approach of all – most firms simply leave it to chance.

At best, they encourage and remind partners to “ask for referrals”. But no thought is put into which clients to ask, how to ask, what to ask for, how to “earn” a referral, etc. At worst referrals are simply not mentioned at all.

These firms are hoping that their good work will result in positive word of mouth and spontaneous referrals. Sadly, research by TARP in the US has highlighted that referrals simply don’t happen spontaneously.

When it comes to dissatisfaction:

  • An unhappy customer will share their bad experience with an average of 12 other people (in my case, when it comes to bad customer service at John Lewis, I share it with thousands via this blog)
  • Each of those 12 people will in turn mention it to 6 others.

Unfortunately, when it comes to a satisfied customer:

  • A happy customer will share their experience with just a few friends;
  • Those friends will not remember much and will not share that information with anyone at all.

Essentially, without further proactive work from the service provider, positive “word of mouth” ends with a few friends and colleagues of the satisfied customer.

So professionals and their firms who want to get more from referrals need to get serious in their approach. They need to develop and implement a plan to proactively address all the key elements which influence both the number and the quality of referrals received. The key factors influencing the value of referrals are discussed in the next post in this series.

Filed Under: Business Development Strategy Tagged With: