Ian Brodie

Ian Brodie


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Book Review: Professional Services Marketing

Posted on August 5th, 2009.

Professional Services Marketing BookOne question I get asked quite often is “Can you recommend a good book on marketing professional services?”.

And to be honest, my normal answer is “not really”.

For sole practitioners and small consulting firms, Robert Middleton's Action Plan Marketing material is an excellent resource. For larger firms there's very little on marketing that I find helpful, so I usually point them to the relevant chapters in more general works like Maister's Managing the Professional Service Firm, Harding's Rainmaking or Denvir & Walker's Growing Your Client Base.

Well, now I have something to recommend.

Professional Services Marketing
is Mike Schultz & John Doerr's new book focused on helping professional firms build strong brands, create a “lead generation engine” and develop effective business development cultures.

Here's the difference with Professional Services Marketing – it's based on what really works in professional services.

As well as running their own professional service firm, Schultz and Doerr advise leading law, accountancy and consulting firms. And as the founders of Raintoday.com, they have access to the most recent research on lead generation methods, client buying criteria, fee rates, etc.

The impact of that experience and research comes through loud and clear in the book. What you won't find here are unsubstantiated theories or concepts from product marketing crudely adapted to a services environment. Instead, it's based on practical, real-world-tested ideas.

Example: In Chapter 6 – Don't Worry About Your Competition, they debunk a number of myths hung-over from product marketing. “You must be a first mover” – nonsense. “You must be #1 or #2 in your market” – pish. “You must have a USP” – yeah right. I come across these myths frequently (and unfortunately, I hear them repeated by too many trainers and consultants who should know better). Schulz & Doerr demonstrate here and throughout the book that they're not afraid to break with conventional wisdom and to “tell it like it is”. Using research and experience they show how these ideas are not only wrong for professional service firms, but that by following them they can damage your business.

OK – so here's what the book actually covers:

  • Marketing Planning
  • The Key Levers of Lead Generation
  • Options for Fees & Pricing
  • Competition
  • Culture
  • Branding
  • Uniqueness (and why it's a mistahe to think you need to be unique)
  • Thought Leadership
  • Marketing Communications
  • Lead Nurturing
  • Targeting
  • Selling
  • Networking
  • “Hustle”

No book is perfect, of course. The chapter on selling has some excellent ideas (particularly about the importance of surfacing client aspirations as well as problems) – but isn't enough on it's own to turn a stumbling accountant or brash lawyer into a competent salesperson. I'd have liked to have seen pointers to more detailed resources in this area like Let's Get Real or SPIN Selling.

But overall – how highly do I rate the book? Put it this way: I got a free electronic version of the pre-release version of the book – but I've stumped up my own cash to add a hard copy version to my library for reference.

You can buy it at amazon.com or for us Brits, at amazon.co.uk.

If you do buy it in the next few hours, you'll be eligible for a number of free bonuses, including a Raintoday webinar and articles from Larry Bodine, Ardath Albee, Brian Carroll, Jill Konrath, Vickie Sullivan and others. Once you've bought the book, go to professionalservicesmarketingbook.com/bonus-materials to get access to them.

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Marketing

10 Linkedin Tips for Professionals

Posted on August 1st, 2009. Linkedin Tips For Professionals

Linkedin Tips For Building Your Professional Presence And Getting More Clients

My latest tips on building a Client Winning Profile for Linkedin are now on a free, short video – click here to watch it.

Linkedin is the “social network for business” and now has over 200 million users.

And many Linkedin users, myself included, have found new clients through it, and enhanced relationships with existing clients. But many others have found it to suck up a ton of time for very little gain. So here are 10 quick tips for getting the most from Linkedin.

1. Make your profile client focused

The first thing you do when you join Linkedin is to create a profile. And since Linkedin has slots for your previous job roles, qualifications, etc. there’s an almost overwhelming temptation to make your profile look like your CV.

Resist that temptation.

When you first meet potential clients you don’t rattle off a huge list of companies you’ve worked for and the responsibilities you’ve had – that would bore the pants off them. So don't do the same on Linkedin.

Most effective introductions focus on who you help, and what problems you help them solve or results you help them achieve. Then if asked more, you say a bit more about what you do – perhaps giving a little backstory as to why you are uniquely qualified to help, or an example of the work you do.

Linkedin is for making connections – and for the majority of professionals that means clients and business partners, not recruiters.

You need to design your profile to have the impact you want on those connections. Treat it like your introduction at a networking meeting.

Think about the impression you want to make on your potential clients. What will get them interested enough to read your profile? Probably something telling them you work with people just like them and deal with the sort of challenges they have.

What will make them read on? Probably some interesting examples that spell out and “prove” the results they could get by working with you.

What would make them contact you? Well, at minimum a call to action with details of how – a website, phone number or email address.

Whatever you do, don't just stick your CV details in there.

2. Get connecting – but…

Linkedin works on connections. The most powerful use of Linkedin is to find new clients and business partners through the search function or directly via your contacts' connections. The more direct connections you have, the more opportunities you have to connect. I still see people who’ve made all the effort to set up their Linkedin profile – but who have so few connections that they don’t get any benefit.

The Linkedin toolbar for Outlook provides an easy way of inviting the your Outlook contacts and people you email regularly to connect with you.

However, there’s a catch…

3…Choose your connection strategy carefully

There are two very different strategies to connecting on Linkedin: “Open Networking” and “Trusted Partner Networking”.

In business networking generally, the value you get from your network is a product of the size of your network, and your ability to “convert” connections into productive business (work, a referral, etc.). You can grow the value of your network by getting more connections, or deepening the strength of each connection (getting to know people better, helping them out, etc.)

On Linkedin, one strategy for getting value is to be an “Open Networker” or LION (LinkedIn Open Networker). Open Networkers focus on growing the size of their network by initiating and accepting connection requests from as many people as possible. Open Networkers typically have many thousands of connections. This means that when they search for useful relationships (potential clients or business partners), for example looking for contacts in specific companies, or geographies or with specific interests or job titles – they are much more likely to find them (exponentially more likely because of the way Linkedin connections work).

The downside of this strategy is that with thousands of connections they don’t know many of them particularly well, if at all. They’re essentially using Linkedin as a giant Rolodex or telephone directory rather than as a way of making deeper connections. That’s neither good nor bad – it just means that if they find someone they want to connect with through one of these “shallow” connections, they’re unlikely to get a strong referral to them – they'll still have to initiate a relatively cold contact.

The other strategy is to have fewer but deeper connections – a “Trusted Partner” strategy. Here you only connect to people you already know and trust. Most likely from face-to-face interaction, but possibly from online interaction too.

With this strategy you have less chance of finding someone via a search because you have less connections. But if you do find someone, it'll be through someone who knows and trusts you – and they'll be able to give a strong referral to you and put you in touch with the person you’re interested in connecting with.

The downside to the “Trusted Partner” strategy is that it’s a bit like going to a face to face networking event and only speaking to the people you already know. You deepen your relationship with them – but you don’t build any new relationships.

Personally, I take a “middle way” and I recommend you do the same.

I don’t actively go out and connect with huge numbers of people. But if someone wants to connect with me, and their profile looks interesting – then I’m very happy to connect with them, even if I don’t know them. If they do turn out to be a “spammer” (I’ve only had this happen once with over 1,000 connections) then I can always disconnect.

This way, my network expands significantly. I meet new people who may turn out to be helpful to me, and I may be helpful to them.

I always try to take the time when people connect with me to send them a message to start a conversation rather than just accept the connection but never speak to them. That way we find out more about each other and it may lead to interesting and valuable discussions. At minimum, it means that if I want to ask a favour later, we'll actually have interacted before.

4. Use Search to find potential clients and business partners

This is perhaps the most important of my Linkedin Tips.

Many people get going on Linkedin but fail to use it to help their business. Absolutely the most effective way I've found to gain business value from Linkedin is to find potential clients and business partners. One of the things I do in my consulting practice is to help clients get more referrals for their business. And one of the key things I teach them is to be very specific in who they ask to be referred to.

Linkedin allows the ultimate in specificity. You can search for exactly who you want to be referred to – by company, by geography, by name, by job title, etc. And you can search across your entire network at once. Or you can look at the contact list of an individual to see if there’s anyone you’d like to be connected to.

Almost everyone I've taught to do this has been staggered by just how many people their contacts know that they'd love an introduction to. Yet before using Linkedin they had no idea that they were connected.

Once you’ve identified people you’d like to be introduced or referred to, rather than try to connect them directly, give your mutual connection a call and ask them if they can connect you. That’s much more polite than going directly, and it’s much more likely to be successful.

5. Give recommendations and endorsements to get them

Recommendations are very helpful to have on your profile. They’re a clear indication of the quality of your work and the relationships you form.

But begging for a recommendation isn’t a great strategy.

If you want to get recommendations, use Linkedin to give them to people you’ve worked with and who have done a great job for you. Linkedin will show them the recommendation to approve, then ask them if they want to reciprocate. They probably will.

Similarly with the new Endorsement feature, if you endorse someone, they'll be notified and you're likely to get a reciprocal endorsement in return. if you get an impressive number of endorsements you can move them up in your profile to just under your summary. So the first thing people see after finding about about you is that lots of people think you're great.

6. Have a helpful Professional Headline

Another one of my most impactful Linkedin Tips. When people find you in searches on Linkedin, the initial thing they see is a little box with your name, photo, and your “professional headline”.What most people have in their headline is their job title. “Owner at XYZ Company” or “Principal consultant at ABC Ltd”. By default, unless you change it manually, Linkedin takes the headline from your last job title.

Unfortunately, this doesn’t give people a clue as to whether you might be able to help them, or might be interesting to connect to.

You should treat your headline like your introduction when networking. Focus on what you can do to help people.

My headline, for example is “Straight talking advice for Consultants and Coaches to help them Attract Clients and Win More Business”. It’s much more useful in telling people what I actually do than using an “official” job title like Managing Director. That will get more people to click through to my profile and maybe begin to interact with me.

You can edit your Headline via the Edit My Profile option.

7. Join Linkedin Groups to connect and interact (but be careful)

Linkedin groups are essentially discussion forums for specific interest groups. They allow you to find out the latest news, and to join in debates on topics of interest. You can join groups both of interest to you professionally, and the groups where your potential clients “hang out”.

Some people have reported great success in meeting potential clients and building their credibility by being helpful and answering questions on Linkedin Groups. But be careful. My own experience is that far more people end up wasting hours of time in fairly idle chatter, or in trying to sound clever but with very little impact.

Before you join a group, click on the link to check out the group statistics and look at the activity stats. What you want to see is a lot more comments than discussions started every week. Lots of comments means members are actively engaging with each other. Lots of discussions with few comments means people are just posting their stuff and no one is reading or engaging with it.

8. Use Status Updates to subtly remind your contacts of what you do

Linkedin status updates are a nice way of helping to stay top of mind with contacts. If you were to call or email all your contacts any time you did something small but interesting, it would quickly become seen as pushy or spammy. But updating your status is an non-intrusive way of getting a gentle reminder out.

Depending on their settings, your contacts will get a regular email with a summary of the status updates of their contacts. And they will see the updates on their Linkedin homepage. Mostly it will just be “so and so updated their profile” type messages. So if your status update has something interesting in it (“Ian has just run a seminar on consultative selling skills”) it will remind them of the sort of thing you do and may even trigger them into action.

Recently, for example, I put up a status update saying I’d run a training course on Marketing for Consultants for the Institute of Business Consulting. That prompted one of my old colleagues to get back in touch and we came to an arrangement about sharing training material.

You can also share your latest blog post and other useful resources. Be careful through: Linkedin isn't Twitter and your connections won't appreciate you making dozens of updates a day as it will mean they can't won't anything from their other contacts.

9. Watch others’ status updates to initiate contact

Keep an eye on status updates from others – it can be a good opportunity to get back in touch – especially if they’ve changed jobs or have set out on a new venture. Even small status changes can help give you something to start a conversation – the sort of smalltalk needed to keep dialogues and relationships going in between more meaty topics.

These days many CRM systems like Salesforce and Highrise offer “Social CRM” features. They make it easy to find your contacts on Linkedin (and Facebook and Twitter) and track their activity on their profile page on the CRM.

10. Keep your use of Linkedin in balance

This is less a tip about using Linkedin, and more a tip about not using Linkedin.

Do bear in mind that Linkedin is just a tool. And it's one that's very easy to spend too much time on. Endlessly tweaking your profile to make it just that little bit more perfect isn't going to bring you any new business. Nor is chatting away on a discussion group to buddies you already know.

Be judicious in your use of Linkedin. Get a good profile. Make sure you're connected to people you know would recommend you, then harness that network to get introductions to potential clients. In a couple of upcoming articles I'll show you who to do that in the most effective way.

But make sure you're not sucked in to spending hours a week playing around with it.

More Linkedin Tips:

How To Optimize The New Linkedin Profile >>
The Number One Linkedin Mistake And How To Fix it (Free Video) >>
The Real Secrets of Linkedin >>

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News

Are You Sales Averse? July Issue of Outside In Newsletter Published

Posted on July 28th, 2009.

Are You Sales Averse?Let's face it: professionals hate selling.
Consultants like me hate selling. Architects and surveyors hate selling. Accountants hate selling. And lawyers: lawyers really hate selling.
And we don't just hate the act of selling. Many of us hate the entire concept of selling. We feel it's beneath us. It's demeaning. We're experts in our field – we shouldn't need to sell.

Most professional firms can't even bring themselves to call it selling. It's business development or client relations. Not selling.

If you, or others in your firm ever get these feelings, then this article from my old Outside In Newsletter is for you:

Are You Sales Averse

The lead article focus in-depth on Sales Aversion – the peculiar dislike we professionals have of selling. We look at it's cause and most importantly, how it can be cured.

There's also a Quick Tip on LinkedIn Profiles (a really powerful, yet simple to implement change to your profile that has a huge impact on how you're percieved).

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Selling

How to Run Effective Client Meetings – The KFC Approach

Posted on July 17th, 2009.

Meeting PlannerHow many meetings with clients have you been to that were aimless, unstructured and poorly planned?

If you're like most professionals, probably quite a few.

The problem's particularly acute when it comes to business development meetings: your first few meetings with a potential client when you and they are trying to figure out whether you should work together. Make a mis-step here and the relationship is over before it's begun. Yet so many professionals try to “wing it” with little preparation and only vague objectives for the meeting such as “get to know each other” or “find out their issues”.

Set up your meetings like this and you'll find that time after time your opportunities progress as far as the first or second meeting – but no further. From the client's perspective they simply can't afford to invest time in meetings with professionals which don't seem to be going anywhere and where they don't get value from the event itself.

A Structured Approach to Client Meetings

UK Copywriter Andy Maslen has a neat acronym to help writers approach sales copy. And the approach can be extended very effectively to client meetings too.

The acronym is KFC:

K – Know

F – Feel

C – Commit

It starts with Commit. At the end of reading the copy (or in our case, at the end of the meeting) what do we want the client to do – to commit to? For sales copy it could be to pick up the phone, fill in a form or click to buy. For a business development meeting it could be to agree to a follow-up meeting to discuss a specific topic in more detail, or to introduce the professional to a senior colleague. Then, you figure out what the client or potential client must Know and Feel for them to be comfortable making the commitment.

Start With a Clear and Realistic Objective

Every client meeting must have a clear objective of what you want to achieve from the meeting. And in particular, you must identify what you want them to actually do as a result. Because if they don't do anything differently as a result of the meeting then what was the point?

Even if your goal is primarily to progress the relationship in some way – that progression needs to manifest itself in meaningful action. It may be something simple like providing more information, or making an introduction, or agreeing to a joint follow-up – but it needs to be something or the relationship really hasn't progressed.

Make the objective realistic too. Your end goal may be for them to hire you – but that's unlikely to happen in your first meeting. Winning business in professional services is more like a courtship than a “one night stand”.

A more realistic first meeting objective is to jointly agree on the key challenges the client faces that you could help with, to hold a follow-up meeting to explore these in more detail, for the client to do some homework and bring more details and data on the specific area, and for you to bring along some examples of similar work you've done for other clients.

Identify the Critical Success Factors for Achieving the Objective

Having a clear meeting objective is important (and it's surprising how many professionals don't actually do it) – but on it's own it's not enough.

You need to think through what it will take to achieve that objective in the meeting. That's where the K and the F come in.

So if your objective is to get a follow-up meeting to discuss a specific area to work on together – what will the client need to Know and Feel for them to agree to that?

Know is about facts. Perhaps they need to know the areas you work in, the types of clients you've worked with before, or that you're a real expert in your field. That will begin to give them the confidence that you have the skills to work on their problem.

Feel is trickier – but often more important. What do they need to feel to commit to your objective. Perhaps they need to feel that you understand them, that you're “on their side”. Perhaps they need to feel that you've really listened to them, or that you're a person they can trust.

How do you get your client to Know what they need to know and Feel what they need to feel? That's the art of business development.

Use Smart Questions to Help Clients “Know and Feel”

Firstly, recognise that you certainly won't effectively get across the right knowledge and particularly feelings through a long presentation about you and your company. That might get across some of the right knowledge – but it will create entirely the wrong feelings. Your client will feel that you're more interested in yourself than them – that you don't listen – and that meetings with you are going to be deathly dull.

One way to get across your knowledge and experience that doesn't come across as dull and self-promotional is to use short stories and anecdotes of similar client situations. I go into more details on this in my post on Selling With Stories.

Most often, the route to both establishing the things the client needs to know, and in getting them to feel the right way about you is to ask smart questions. Being able to ask the right questions that really home in on tough issues and the underlying causes will establish your expertise far more than any claims you might make about it, qualifications you might have or awards you might have won. And by empathising with the responses and occasionally mentioning similar situations you've been in, you'll establish the right feeling of “he understands me” and “he's been in this situation before – he'll know what to do to help”.

So the bulk of your preparation and structuring of the agenda for the meeting should be on the questions you need to ask to both find out what you need to know – but more importantly, to help the client know and feel the things you identified were critical for them to then be comfortable agreeing to the objective.

Close by Asking for a Commitment

And finally, of course, you must close by asking for that follow-up meeting, or the introduction you were looking for, or at the end of a series of meetings – actually asking for the business.

Sounds obvious: but so many professionals fail to do it. Fear of rejection kicks in and they close weakly without making a clear request for the action they're looking for. And so it doesn't happen.

But if you've planned and prepared correctly. If you've structured the meeting to cover all the bases necessary to help the client know and feel the right things – then they should be perfectly comfortable committing to the desired action.

PS You can download a free copy of the meeting planning template I use (as in the picture) here

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Marketing

Reconnecting With Old Clients: A Step-By-Step Guide

Posted on July 14th, 2009. Reconnecting With Old Clients

Reconnecting with old clients can be your very best source of new business and referrals.

You've probably even got a pretty good “little black book” of names – people who already know, like and trust you. People who could be good sources of referrals or even new work with their companies.

But there's a problem.

You're hesitating. You haven't been in touch for over a year. You don't want to seem like you're “begging” for work. You don't want to risk them seeing you as “too salesy”.

And wouldn't they be knocking on your door if they needed your help or had a referral for you?



Click here to read what you should do »

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Mindset

Building a Portfolio of Business Development Approaches

Posted on July 6th, 2009.

Different PeopleA common problem many professional firms face is overly relying on only one approach to business development. They focus all their efforts on word-of-mouth & referrals, or on networking, or on responding to tenders/RFPs. Typically, the basket they keep all their eggs in is the one they are the most comfortable with: it's worked for them before, they have the skills to do it, and it doesn't push them outside their comfort zone.

This works fine when times are good and there's plenty of work for everyone. But in tougher times, if that one source dries up, they are left stranded.

I advise my clients to run a portfolio of different approaches. I usually get them to focus on four very different areas:

  1. Current Clients: investing in “superpleasing” their highest potential current clients to secure their business, win expansion and extension projects, and get referrals to new clients. Typically this area uses the approaches of Client Relationship Management and Key Account Management.
  2. High Probability Potential Clients: targeting 3-5 named companies which meet their core targeting criteria (size, industry/sector, geography, leadership, cultural fit, etc.) and where they have a good chance of winning business (e.g. an ex-client, previous/current contact,  a good opportunity for a referral in). Typically, personal approaches are used: direct contact where there is a pre-established relationship, referrals where there aren't.
  3. Ideal Potential Clients: targeting 3-5 named companies who meet all targeting criteria and would be the absolute perfect clients – but where there are no immediate entry routes to establish a relationship.  Typically, longer-term relationship building approaches need to be used: for example searching for and courting potential referrers, running a targeted mail campaign sending selected articles and research, offering to run a free seminar for a client organisation.
  4. “Bluebirds”: these are clients who are won unexpectedly rather than being directly targeted. How can you win these sort of clients? By having a channel or approach aimed at getting visible to a broad set of potential clients. For example: public speaking at events with a high preponderance of target clients, running a seminar at a large client industry event, optimising your website for keywords frequently used by target clients. The key here is to use approaches which give access to a broad set of potential clients (rather than the more focused approaches discussed earlier which narrow down to a few specific clients – but with a higher probability of success with each one).

Focusing first on current clients is common sense, and should be a core part of any business development strategy. After that, adopting a portfolio strategy like this balances out the short-term potential of the High Probability Potential Clients with the long-term higher gain of the Ideal Potential Clients – while still keeping the possibilities open for serendipitous new business through the use of a “bluebird” channel.

Larger firms with more business development time & resources available can adapt this strategy by increasing the number of Current, High Probability and Ideal Potential Clients targeted – and adding an extra “bluebird” channel.

My advice for most firms though is to always add resources in that order. For many professionals, the “bluebird” channels (e.g. web, speaking, articles) are seductive ones as they offer the hope of attractive new clients without the challenge of personally engaging in the process. Resist the urge to focus too much effort on these channels – the big payoffs are usually in the more targeted, personal approaches.

Image from FreeFoto.com

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News

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

Posted on June 26th, 2009.

Back in 2009 I did a monthly email newsletter wih hints and tips on marketing and business development for professional service firms.

The first month's feature was and still 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 you can read the archived copy of Outside In Newsletter Issue 1 here.

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Marketing

How to Get More Referrals Using Offers

Posted on June 20th, 2009.

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.

It could be a report you've 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 and their client 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.

PS For more details on this strategy, check out Steve Gordon's excellent book Unstoppable Referrals.

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Marketing

The Referral Formula

Posted on June 17th, 2009.

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

Featured

Strategy

Keep out of the "Muddy Middle" when Selling Professional Services

Posted on June 16th, 2009.

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 1% conversion rate when you have only 20 potential customer will not lead to much business. A 1% 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.