5 Business KPI Metrics to Follow

Success in business is a numbers game and every business owner and leader would be wise to pay attention to certain metrics, which are Key Performance Indicators. Depending on the business, owners and leaders may follow the daily sales receipts, weekly gross sales, monthly inventory purchases, monthly in-house projects and of course the big three monthly, quarterly and annual financial documents—-Income Statement (Profit & Loss), Cash Flow and Balance Sheet.

KPIs are like vital signs and lab tests; they indicate the health of the organization. Owners and leaders examine, analyze and confirm the venture’s health (read: profitability) or discover and diagnose a problem, for which a strategy is devised to provide the treatment.

Today, we’ll dive into sales and marketing KPI metrics that business owners and leaders would do well to monitor—-Lead Conversion Rate, Sales Cycle Length, Client Acquisition Cost, Churn Rate and Client Lifetime Value. When steps are taken to bring these KPIs into what represents an acceptable range for your industry, a tangible positive impact on the organization will result.

Lead Conversion Rate

Grab a spoon, Love, and get ready to taste test our flavors of the day—-TOFU, MOFU and BOFU. I promise that you’ll enjoy them all, most especially BOFU. Let us begin.

Marketing = Lead Generation, the fuel that feeds the sales engine that keeps the business moving forward. This KPI reveals the strength of the company’s marketing strategies and tactics. First, verify that the marketing mix is actually producing leads that convert to sales. Second, leads that converted to sales should be examined to discover which tactics enabled conversions. Bonus points will be awarded for discovering which marketing tactics bring in a particular type of client—-low or high dollar volume, repeat business or one-off, or a certain product or type of project.

Marketing announces the presence of a business to its target audience and it’s designed to both arouse curiosity and inspire confidence in the product, service, or company that is featured. The intent of marketing is to entice target audience members to linger and browse the marketing outreach. These early-stage browsers are leads at the top, the front door, of the marketing/ sales funnel. They are called TOFUs, Top of the Funnel. Most TOFUs are window shoppers.

Now let’s suppose a TOFU decides to follow the company blog, or interact with the business on Instagram or Facebook. Or maybe the TOFU finds an e-book and after reading the promo, requests a copy. TOFU will then advance through the marketing/ sales funnel and enter the Middle of the Funnel. TOFU will become a MOFU.

MOFU is where lead conversion really begins. MOFU is a fish on the line. To become a client, MOFU must be skillfully led into the VIP Room at the Bottom of the Funnel, BOFU, where intentions are revealed, needs are discussed and commitments are confirmed.

How to do it? If MOFU is in deal-making mode, those who subscribe to the blog or newsletter, or especially those who request an e-book, white paper, or case study, will contact the company to ask for additional information. MOFU will ask to schedule a 15- minute free consultation. If you meet MOFU at the virtual workshop you presented, there will be a request for follow-up. “Can we Skype?”

A well thought-out marketing/ sales funnel draws in TOFUs that sometimes become MOFUs who have reason to turn themselves into BOFUs. That is effective lead generation.

Business owners and leaders must continually review the operation of the marketing/ sales funnel to ensure that a good number of prospective clients are entering at TOFU. They will monitor the percentage of MOFUs who advance to BOFU and the percentage of BOFUs who become clients.

Sales Cycle Length

Determining how long on average it takes for TOFUs to become MOFUs, then BOFUs and finally paying customers, is useful for cash-flow planning. There may be no way to shorten the marketing/ sales funnel journey and speed up the sale, but getting an idea of when money will arrive, or will not, is essential.

If there are recognizable points in the funnel when it may be possible to speed up the sale, that will be money in the bank. When a prospect reaches MOFU, demonstrations of the company’s expertise, VIP clients, superb customer service, or sterling reputation can be presented to convince the prospect to continue the sales journey. BOFU is the time to make tempting deals—-a desirable upgrade that costs little to deliver, for example. Get the deal done as quickly as possible.

Client Acquisition Cost

It is worthwhile for every business owner, business leader and Freelance consult to ascertain the ballpark cost of the time and money associated with bringing in new clients.

After calculating the time spent writing a newsletter and/ or blog; the time devoted to perfecting social media posts and uploading, to say nothing of creating, videos and photos that support the company’s brand story; the time needed to create a presentation that will be delivered at the chamber of commerce or other venue, along with the Power Point slides and hard copy hand-outs that are typed up—-what dollar value should be attached to the labor devoted to promoting the company, its products and services, and yourself as its public face? Get your arms around that one, will you!

I estimate that I spend 10 -15 hours/ week on marketing activities (mostly this blog) and I’ve allowed myself to claim $35/hour as the wholesale value of my labor (because creating content, taking blog photos and typing are not all billed at the same rate). I’ve decided it’s fair market value to claim that I spend 50 hours/ month, $1,750/ month, on marketing. Wow!! Am I getting the right ROI on client acquisition? Maybe I can learn to type faster? It would help.

I am not signing a new client every month. However, I do get repeat business, plus the occasional referral, and that lowers my customer acquisition cost significantly. This is yet another reason to exceed client expectations and provide superb customer service, so that repeat business and referrals are more likely to be received and marketing dollars will produce a greater ROI. Furthermore, if it’s possible to determine which marketing activities attract high dollar volume projects, prioritize those tactics.

Client Churn Rate

Business experts often warn that it costs at least five times more to acquire a new client than it does to retain a current client. Surprisingly, many, if not most, companies lack a client retention strategy and action plan. The rate at which clients stop doing business with an organization is called the churn rate.

Churn rate is calculated by counting the number of clients that no longer use company products or services, expressed as a percentage of the total client list. % churn rate = # Defections / # Retained If there are 50 clients on the company roster and 5 haven’t made purchases in 12 months, then the churn rate is 5/50 = 0.1 x 100, a 10 % churn rate.

If the company churn ratio creeps up through the year, the culprit could be inadequate customer service. Include a short survey with your invoice to encourage clients to tell you how to improve their customer experience.

Client Lifetime Value

Unless the company has history with a client, lifetime value is a projection, an educated guess. Nevertheless, it is important to think strategically about every prospect, since some are worth pursuing and others, not so much.

When evaluating marketing activities, Freelance consultants, business owners and leaders will examine the revenue potential of the target audience and decide the level of resources that should be devoted to the client acquisition process. This KPI, actual or projected, reveals the amount of revenue that can be generated, in a year, or perhaps a quarter, by way of a particular (or the average) client.

When considering prospects who could become clients, prioritize and invest marketing resources only in those with high revenue and/or repeat business potential. Don’t waste resources on low dollar volume clients. Follow the money.

Thanks for reading,

Kim

Photograph: Kim Clark. Trading prices are the KPIs of the New York Stock Exchange.

Questions that Move a Sale Forward

Well cha-cha-cha! You were able to resurrect a pre-COVID conversation you were having with a potentially good prospect and not for anything, you need to consummate this sale. Selling a prospect is like a dance and s/he who is selling must learn to lead with style and grace.

Step 1 is to understand what the prospect needs and the job specs, the specific work that must be done. Step 2 is to confirm that you’re able to do the work within the requested timeframe and allotted budget. Step 3 is to convince the prospect that you have mastered Step 1 and can achieve Step 2.

Since the shutdown, the ground has been quaking beneath our feet. Business owners and leaders are in various shades of panic, searching for answers and in need of reliability and support from their Freelancer colleagues. The need to establish trust cannot be overestimated. Your prospect must believe that you will not disappoint.

If you have not worked with the prospect before and the discussion will take place over Skype or other video platform, establishing the familiarity and comfort level that are the ingredients of trust will be more of a challenge. Turn up your listening skills and empathy because you’ll need those qualities more than usual. See my post https://freelancetheconsultantsdiary.wordpress.com/2020/07/14/what-scientists-know-about-virtual-meetings/

The 12 questions below are designed to 1. Display your empathy and ability to become a trusted resource; 2. Confirm the prospect’s intentions; 3. Specify the work you would perform; 4. Learn if your prospect is the decision-maker; and 5. Get an estimated starting date. At the conclusion of the conversation, the prospect should invite you to submit a proposal. If that does not occur, I would follow-up with a thank you email and then put this company on the back burner.

“In light of the new business environment, how has your process changed?”

“What are you doing that’s working well right now?”

“What’s hardest for you now?”

“What can you still do that you were doing before the shutdown?”

“Do you see what seem like good opportunities on the horizon?”

“Are there plans or intended projects that have been cancelled or put on hold?”

“Confucius said that a journey of 10,000 miles begins with the first step. What first step can I help your organization take?”

“Is the project we’re about discuss today something you planned to do before the shutdown, or is this a new initiative?”

“Is there something that is blocking you from taking the next step forward, or causing you to hesitate ?”

“What is the solution that would give the most impactful long-term benefits to the company?”

“How can I be a good resource to you and help you move forward?”

“If you were the only decision-maker, what would be your preferred start and completion dates?”

Thanks for reading,

Kim

Photograph: Kim Clark. Dancing to the music at the 2019 Tito Puente Latin Music Series at Villa Victoria in Boston’s South End neighborhood.

# Red Light

So off you go, on a mission to reconnect with clients you haven’t worked with since the four month long COVID-19 shutdown began. You gracefully maneuver to position yourself to grab some billable hours before all of your Paycheck Protection Plan money runs out. You’re also on the hunt for new clients, maybe picking up the thread on leads you were checking out in the first quarter, before the rug was pulled out from under.

If good fortune prevails, you’ll bag a live one and generate some much-needed revenue. But do keep your senses tuned to any “off notes” while you and the prospect discuss the project specs. You are trying to work with this person, or someone on his/her team, and by no means do you want to walk into a toxic environment because you will fall. You will not be able to perform at your best. You will not be able to use that client as a reference.

it is important to notice and acknowledge the behavioral cues displayed and statements made by every prospective client. Do not get carried away by a seductive mix of need and excitement. Yes, making money is the point and you may also crave a project that you find not just lucrative, but also exciting. There may be a special skill that you own but rarely have the opportunity to display and at last you could be able to flaunt it.

But if the prospect makes you feel uncomfortable before the project work has begun, the smart Freelancer must find the strength to stop and walk away from someone who is already telling you that they’re a jerk who is out to hurt you. Assuming that this individual even pays the full amount of your invoice, in the end you will have to admit that the money earned from working with this guy or gal was not work the aggravation.

The best damage control that a Freelancer can take is to stop the process and walk away. Let’s examine a few examples of bad guy/ gal behavior:

“I’ve tried working with Freelancers before. I never get what I want.”

This prospect either doesn’t understand how to write and explain the project specs; doesn’t know what actions will achieve company goals; doesn’t understand and refuses to provide the support or authority a Freelancer needs to successfully complete the task; is a rabid micro-manager who is never satisfied by any work other than his/ her own; or cannot/ will not allocate the budget to hire a Freelancer who is able to do the work.

Do you see yourself swallowed by a giant whirlpool? You should. Stop. Turn around. Walk away.

Prospect don’t trust your references

You’ve supplied two or three solid references, clients for whom you’ve done work similar to what the prospect is looking to get done and the clients were very pleased. You exceeded expectations and created a positive experience. But the prospect is not convinced. Your references are not good enough, as far as s/he is concerned.

A dear friend of mine has often said that there are some people who will not take Yes for an answer. This prospect is not ready to become your client, for whatever reason. Maybe the prospect now feels uncomfortable with outsourcing this project to any outside expert?

Whatever. You cannot satisfy this individual. Shake hands and say goodbye, while you can still pretend to smile.

Prospect questions your fee and the value you’ll bring

The shutdown caused most businesses to take a significant financial hit and the impulse to keep all costs low is in the air. Freelancers are wise to be flexible about balancing their project fee against the work that clients need to do to get their ventures moving forward and the lower budgets that clients now live with. However, exploitation is never acceptable and must never be tolerated by a Freelancer.

Before your proposal is in writing, project specs should be discussed, including a ball park budget figure. Using that information, Freelancers can with confidence draw up a proposal with budget and submit it to the prospect. In this way, there will be no surprises. When the prospect shares some indication of the earmarked project budget along with the project specs, the Freelancer will quickly know whether or not s/he can do the job for that price.

But when the prospect wants to be secretive, it’s a bad sign. People need to be transparent and if they don’t want to do that, it will be unpleasant to work with them. Moreover, if the prospect alludes to the fact that his/ her team has the ability to do the job themselves, you may need to diplomatically hint that they might need to do just that because the work to be done demands a certain amount of time and skill.

You are willing to be flexible, you are willing to do a smaller piece of the job for the money that the client has suggested for the entire project, but you cannot give your work away. Then shut up and hear what s/he says in response. The specs will either shrink or you’ll walk.

Project timetable and other guarantees are unrealistic

Timetables and deadlines may require some help from the client if they are to be met and the smart Freelancer will put into writing the kind of resources that the client will provide and by what date. Furthermore, in certain cases the full scope of the project cannot be known until the work has been started. Obtain as much information as possible about the project specs to minimize risks and promote client satisfaction.

If you’re having trouble either reconnecting with current clients or signing new ones, you may need to tweak your pre-COVID-19 business model. Things have changed. No one has a written-in-stone game plan. Pivot has become the word of the month, if not the word of the year. Your first assignment may be to get a fix on what services are in demand now and how you can package and promote your entity to be considered a trustworthy and reliable purveyor of those services.

When speaking with current clients, even if you send out an email to say hello and get the ball rolling, ask how doing business has changed and make it known that your goal is to help them cross the river without taking any more of a bath than they may have already done.

When approaching a prospect, a version of the previous question can be asked, perhaps as a statement, “As you and your team work to help the organization regain its bearings and serve your customers in the way they now want, or legally must be, served, I’d love to talk to you about how I can help you do that efficiently and cost- effectively.”

Thanks for reading,

Kim

Photograph: Kim Clark. Massachusetts Avenue leaves the Back Bay and enters the South End.

The Beat Goes On : Visit the Job Boards

As the coronavirus continues to stalk the land and our political leaders and many citizens continue to see a business shutdown as the only response, making a living has become very difficult for the 57 million Freelance Professionals in the U.S. (Statista). If our clients don’t work, neither do we.

Federal government relief was rumored to be on the way, but I don’t see any evidence of it. It’s probably going to be smarter to put one’s energy into finding projects from a mix of new and current clients (same as it ever was!).

Still, maintaining the discipline and enthusiasm required for a job hunt is difficult and discouraging when the prospects for success appear bleak. But if you can make yourself surf through job board listings three times per week, you might come up with a project, however small.

I am most grateful that my largest client came through and asked me to provide a one hour marketing consultation with one of their clients, an RN/ Nurse Practitioner and midwife who recently launched a Freelance business that focuses on hormone management in women, from post-partum to menopausal. BTW, I sent Easter/ Passover cards to a select group of clients, including this one, and thank heaven my outreach paid off!

Among the marketing strategies the RN will pursue as she builds her Freelance consultancy is a new website, which will function as a lead generator. I was so excited to be able to refer to the RN a Freelance web developer with whom I had worked a few years ago. I’ve reached out to him and as soon as his schedule allows, I’ll conduct an email introduction and hope that the relationship will be fruitful.

That is how we’ll make it through this never-before-experienced crisis, my Freelancer friends. We must rally forward and do some job hunting at least two or three times each week for at least an hour at a time and as well we ought to remember to refer our colleagues along the way.

Now about the job boards—-I found a few possibilities, some familiar and others unexpected, to help you jump-start the client building work,

Aquent

Specialties covered include Management, Marketing, IT Design, Managed Services and Professional Development. Some workers can qualify to receive benefits. Free online training courses for workers are also available. http://acquent.com

This company is strictly top- drawer and seeks only cream of the crop gig workers. Extended Workforce Services is what the company provides and the work assignments may not be remote; there are 35+ offices around the world, primarily in the U.S.

Guru

The site boasts that prospective employers will work with among the most talented professionals in the field, regardless of the assignment. Among the services provided are translation/ writing, legal services, architecture & engineering, marketing & sales, business & finance, software development & programming and administrative services. https://www.guru.com/d/jobs/

LinkedIn ProFinder

The ProFinder algorithm sends jobs to your inbox, thus eliminating the need to continually search for employment possibilities. Only five proposals are accepted for each assignment, so time matters for assignments that appear very attractive .

Proposals are short, which allows bidders to quickly put themselves into consideration but limits one’s ability to sell oneself in some instances.

I’ve submitted 8 -10 proposals over the past 12 – 18 months, and I came close to being hired only once. The project was interesting and the rate of pay offered was very decent. The lady who interviewed me over the telephone was very nice and also honest.

That said, I still recommend that you sign up for ProFinder, create a profile and compete for assignments. The first 10 submitted proposals are accepted at no charge but to submit additional proposals the job seeker must join LinkedIn Premium at $60/ month and that is steep. Depending on your luck, you may decide to pay up and roll the dice on being hired. Or you’ll pull the plug on this service.

However, none of my other proposals was ever acknowledged, including one submitted by a man who had once written for the New York Times. What was his motive for the job posting? Maybe he thought he just felt my writing isn’t good enough? http://LinkedIn.com

The Creative Group

Freelancers looking to earn money and work on interesting projects may be very happy with this site. It’s the place for advertising whiz kids, marketing rock stars, genius art directors, amazing website designers and super organized account managers, too. Full time and project work is available, both on-site and remote.

The company is a division of the global giant Robert Half Staffing Agency. https://www.roberthalf.com/submit-resumeglobal

TopTal

TopTal announces to both job seekers and prospective employers that the site features the top 3% of Freelancers from around the world. software developers, finance experts, product managers, marketers, graphic designers and project managers are the principal hires. ://www.toptal.com/careers#positions

Upwork

I’ve gotten a couple of small jobs on the site but I abandoned ship when it was announced that it would cost money to submit a proposal. On top of that payment, there will be a 20% fee attached to each invoice submitted. Furthermore, Upwork clients like to low-ball on fees, so there is not a lot of revenue to be generated, unless one specializes in software development and other IT functions.

I was lucky enough to start work on a sales training manual but then the client pulled the plug and regards was the end. She claimed to really like my work. The fee charged was less than half of what it should have been. I suspect that the client suddenly got spooked by the business start-up costs Oh. well. I sometimes think about reaching out to say hello to the client. She was great to work with. http://Upwork.com

Thanks for reading,

Kim

Photograph: Runner on Commonwealth Avenue in the Back Bay neighborhood (Boston, MA) on Monday April 20, 2020, what would have been the Boston Marathon.

Elevator Pitch: Master Class

Every Freelancer has an elevator pitch, but few of those pitches are as effective as they could be. My own could use some work, to be honest. Freelancers are hunters and we thrive only when we bring in clients who trust us with lucrative and/or long-term projects. Arguably, the most important facet of a Freelancer’s skill set is the ability to quickly assess whether that interesting someone we’ve just met might have the potential to green light our next payday.

Street smart Freelancers anticipate the opportunity inherent in every meeting by using our hunter’s instinct to take aim and expertly deliver an elevator pitch that gets bells ringing in the head of a listener. In the conversation that’s sure to follow, these Freelancers ask a handful of smart questions designed to quickly weed out window shoppers, tire kickers and those whose needs do not align with our skill set.

The hunt starts with the pitch and Freelancers must build it with precision and deliver it in 30 seconds. The biggest mistakes Freelancers make in elevator pitch content are: (1) merely stating their skill set or job title, rather than giving a brief description of the problems they solve for clients and (2) failing to communicate the value they provide, the practical application of their expertise, that makes a persuasive case for working with them.

Skills or functions?

“I’m Bob Rossi, a business lawyer who also edits a digital business management magazine.” The information is accurate but Freelancer Bob has not expressed what is uniquely worthwhile about his business, he has not presented a story or any information that might persuade a listener to take notice. Expecting his job title to interest the listener is unrealistic because that alone doesn’t necessarily help anyone understand why s/he should care who Freelancer Bob is and envision how his products or services might be useful.

Whatever your job title and skill set, there are most likely dozens, if not hundreds, of highly skilled professionals who do some version of the same thing. There are many types of lawyers and business writers in the world. The successful hunter-Freelancer knows how to present a tidy little narrative of an elevator pitch that puts the listener at its center. In this much more compelling version, the Freelancer succinctly (1) names his/her specialty— the kind of work that you do best or most often (or your most popular product)— and how you add value; (2) identifies the types of clients you usually work with; and (3) gives three or four examples of article topics that regularly appear in the magazine (marketing, sales, finance and tech, perhaps).

“Hello, I’m Bob Rossi. I help business start-ups solve their management and legal issues, including LLC, incorporation and partnership set-ups. I also edit a nationally known monthly digital business management magazine that addresses topics that are important to business owners, entrepreneurs and self-employed professionals, primarily finance, marketing, sales and tech.”

It’s critical to wordsmith an elevator pitch that will convince the listener to pay attention and, if your timing is right, think of how s/he can use your know-how and imagine bringing you into a project that needs to get done in the near term. A money-making elevator pitch can convert a listener into a prospect who wants follow-up, who will say “take my card and shoot me an email, or call me at around 5:00 PM on a Tuesday.”

Finally, like the old joke says, “How do you get to Carnegie Hall? Practice!” Nothing sounds worse than clumsy delivery of an elevator pitch. You will be dead in the water and the VIP will never give you a second chance. Like an actor or an athlete, Freelancers must constantly rehearse and refine the elevator pitch, working it so that it slides off the tongue effortlessly. Because we never knows when a fortunate encounter with a VIP will occur, practice your elevator pitch often. Edit and edit again, until the wording is perfect and the cadence natural. Learn to step up to the plate on a moment’s notice with confidence, energy and enthusiasm and hit a home run every time.

Thanks for reading,

Kim

Photograph: ©TV Guide. Deluca (Giacomo Gianniotti) delivers his elevator pitch to Meredith (Ellen Pompeo) in Season 15, Episode 9 of Grey’s Anatomy.

Defining and Delivering Good Customer Service

Superior customer service is a cornerstone of the customer experience and the customer experience is a foundational element of the sales journey. I see the customer experience as governing everything that leads up to the sale and customer service as governing what happens after the sale. Along with designing a confidence-building customer experience that persuades prospects to become customers once the need for your products or services is established, to remain viable, every business must develop customer service protocols that support customer retention and encourage referrals.

As reported in Forbes Magazine in May 2018, American businesses lose $75 billion annually due to poor customer service and the U.S. Small Business https://www.forbes.com/sites/shephyken/2018/05/17/businesses-lose-75-billion-due-to-poor-customer-service/#5777314e16f9 Association reported in 2018 that 68% of customers stopped doing business with a company due to poor customer service. It is worthwhile to review your company’s customer service from time to time. Below are suggestions that might guide a refresh of your company’s approach to customer service:

  1. Answer the phone.  When a prospective customer calls for information, s/he does not want to leave a voicemail message and wait for an answer. The prospect wants to speak with a live person now who can answer questions quickly and correctly, in a friendly and professional manner. Hiring the optimal number of front-line staff is the antidote. Freelancers who work alone and receive a fair amount of incoming calls can hire a telephone answering service to take calls when you cannot.

2. Take the extra step. When the intention is to help a prospective customer, understand that doing the minimum is not enough. For example, when speaking with a prospect who has questions about your products or services, merely directing him/her to the company website to obtain more information does not exemplify good customer service. Instead, ask the customer about the problem that must be solved, inquire as to what s/he would like to achieve and then discuss how your product or service can (or cannot) provide the desired solution.

3. Be helpful. If it is discovered while speaking with a prospect that your product or service cannot provide the necessary solution, do not be afraid to refer the prospect to a competitor or another company that can meet his/her needs. Your generosity will be remembered and may be returned with future business and referrals.

4. Listen. Let the customer talk. Allow the customer to ask questions or describe a problem. You (or front-line staff) ask clarifying questions along the way, to demonstrate that you are listening and evaluating how your products or services might be useful (or not) to the customer. The more front-line staff know about your customers and their needs, the more of an asset they will be to your company and customers. Prospects and customers will appreciate the empathy and product knowledge and that will almost certainly increase customer retention, new business and referrals.

5. Resolve problems quickly. No business owner enjoys receiving complaints, but those complaints reveal product or process breakdowns that you have the opportunity to fix. Customers gain confidence when a business quickly responds to and resolves complaints. Apologize profusely and throw in something extra (an upgrade or gift certificate, based on the price of the item purchased) to demonstrate that you value the customer and regret the inconvenience that you’ve caused. If handled correctly, you will win repeat business and a source of referrals (instead of bad-mouthing on Yelp).

6. Train staff. Make training a key element of front-line staff on-boarding. Conduct a product boot camp for new hires, plus an annual refresh for all staff, to ensure that employees are familiar with your product and service lines (bring in a Freelance colleague with sales training experience to conduct the annual training session). Give front-line staff the tools and information they need to support customers as efficiently as possible. Empower them to make those small customer-pleasing decisions, so they’ll rarely have to say, “I don’t know, but the owner will be back at…”

Thanks for reading,

Kim

Photograph: Date night at the malt shoppe 1930s USA

6 Questions to Ask a Prospect

Woo-hoo, you’ve got a live one here! You’ve stumbled upon a prospect and you do not want to screw up and lose what might be an opportunity to get paid. You want to keep this fish on the line and figure out 1.) if s/he is serious about hiring a Freelance consultant to work with and 2.) if the project is something you can handle. A series of easy-to-remember questions that help you to encourage the prospect to open up and tell you what s/he needs and also move the process toward a commitment for further discussion are essential. Your goal, of course, is to obtain a project that will both enhance your revenue and if possible, enhance your CV as well.

Picture this—you and the prospect have each given the meet’n’greet (short) versions of your elevator pitch and the prospect is showing an interest in your offerings and would like some details. You’re asked if you’ve ever worked on a particular sort of project, or provided a solution for a certain kind of challenge or problem. Presented below are questions designed to make it easy for your prospect to share information and allow you to position yourself as a good candidate for hire if a project actually becomes available.

  1. How can I help you?

“A customer’s time is valuable, so that first question must be impactful while still respecting their time,” advises Eng Tan, Founder and CEO of Simplr, a customer service and customer experience start-up. ‘How can I help?’ is open-ended enough to invite feedback, but also show that the customer comes first.”

2. What is the problem or pain point?

You cannot jump into a sales pitch until and unless you hear the prospect describe the matter that must be resolved or challenge that must be overcome. Only then can you determine if you have the expertise and resources to provide the desired solution. Allow your prospect to tell you what s/he would like you to do.

3. What is your goal?

Get the prospect to articulate the purpose of the proposed project and what the resulting deliverable means to the organization. Determine if this is a mission-critical goal and the date that the deliverable must be received. It is to your benefit to understand why the prospect feels it’s worth paying outside help to get the project done. The proposal you write and your pricing structure, if negotiations get that far, will be impacted by this information.

You must also understand what will happen if the client does nothing (and nothing is precisely what most of them do anyway, am I right?). So do your best to find out what it all means to the prospect and the company and how the proposed project fits into important goals.

BTW, not every project that gets funded is tied to a meaningful goal. I know someone who probably makes 3x what I make in a year by producing an ultimately ridiculous vanity-driven deliverable for well-known for-profit and not-for-profit organizations. Enhancing reputations can be big money, it seems.

4. Have you done anything about it so far?

With this question, you’ll learn if the prospect has worked with a competitor. You can follow-up and ask if there was dissatisfaction with the competitor’s deliverable, price, or customer service. If the matter has so far been handled in-house, you can follow-up and ask why outsourcing looks like a good option now. In short, you’ll learn why your decision-maker or stakeholder/ decision-influencer prospect is motivated to talk to you about the problem and inquire about how you might resolve the problem or produce the deliverable.

5. Is it you who decides how this matter gets resolved?

At this point in the conversation, it is both prudent and politic to ask who makes the decision to bring in someone from the outside, i.e., a Freelancer. You will have earned the right to know if the individual with whom you are speaking has the authority to green-light a project on his/her own, or in concert with a select group of stakeholders. You need to get a sense of how superiors, colleagues, or stakeholders feel about bringing in a Freelancer and I recommend that you get an answer before proceeding with the conversation.

It is possible that your prospect is alone in thinking that an outsider should be brought in to manage the project and his/her opinion may or may not prevail. Now is the time to get a sense of whether outsourcing this project is wishful thinking or a possibility.

6. What would you like to see happen next?

With this question, you invite the prospect to commit to follow-up, be it a face-to-face meeting, an email, or a telephone call. The prospect will be able to reconfirm his/her confidence in your capabilities as s/he shares more information about the proposed project and digs deeper into the how and why your product or service can address pain points and facilitate realization of the company’s goal.

This conversation will determine whether you are considered a serious candidate for managing the project and if the company is serious about hiring a Freelancer. You could very well be invited to submit a proposal and if that is the case, it is a big vote of confidence (but alas, still no guarantee).

If asked upfront about pricing, you might like to respond “What’s your budget?” If it’s smaller than you hoped, work with the prospect to provide the project must-haves, minus the too-expensive extras, at a price the organization can afford. Then again, they could surprise you and appropriate more money. You just never know!

Thanks for reading,

Kim

Photograph: The Fuller Brush man visits a prospective customer (circa 1950)

Pitching to Prospects: 5 Tactics That Work

Freelance consultants do not have the luxury of a guaranteed weekly paycheck. We earn only as much as we can invoice. We generate a stable revenue stream by continually marketing our products and services to attract new clients and get repeat business.

In tandem with marketing, Freelancers must also identify and pitch prospective clients we’d like to work with; and who we want to work with are those who use what we sell and have the money to pay for it. Our mission is to convince prospects that our services or products will benefit their organization and make them look like geniuses for doing business with us. We must articulate our value proposition in a way that resonates. Our sales pitch must always place the prospect at its center. Below are pitching tactics that you might find helpful:

Pitch to the right person

As we’ve discussed ad infinitum, you must know your customers.  Start by noting the job titles of prospects who usually work with you. Which industries invite you in and which rule you out? Don’t waste time preparing and delivering a good pitch if the prospect is not a prospect. If health care professionals don’t seem to have a need for what you provide, then don’t try to pitch them. Talk about the weather instead.

Second, do your best to speak with either a decision-maker or decision-influencer. This can be tricky because people are known to overstate their role in decision-making. Some want to vet you before revealing the real decision-maker. Others, I guess, just want to feel important? Whatever!

Dig for the truth by inquiring about the budget, confirming the project timetable or important deadlines, asking who else must agree to green-light the project and authorize funding and who signs the contract. You want to unmask any pretenders. Remember to notice the job title of the person with whom you are speaking (ask for a business card). Decision-makers are Directors, Vice Presidents, Chiefs, General Managers and owners.

Speak to their needs

One of the most common mistakes Freelancers (or entrepreneurs or sales professionals) make when introducing their product or service to a potential buyer is placing the focus on those items rather than on the prospect’s needs. While it’s important to explain features and benefits, the key to making a sale is helping the prospect understand how his/her unique need or problem will be resolved if a purchase is made or a contract to bring you in to provide services is signed. You won’t get paid unless the prospect can envision him/herself using the product, achieving the desired outcomes and looking like a hero to his/her colleagues and the higher-ups.

Identify your prospect’s needs and challenges, concerns and priorities and use that information to devise a solution that’s specifically tailored to the prospect’s circumstances and shows that you’ve thought carefully about and understand the goals. Also, start your pitch with a great opening line. You’ll lose the prospect’s attention if you can’t capture him/her immediately with something that entices.

If you’re cold calling, or if you will attend an event and expect to to encounter an important prospect while there, visit his/her company website to view their organization’s mission statement, learn about major initiatives that were recently or will soon be launched and investigate the management team. Look for community outreach efforts, peruse the social media accounts, read what’s appeared in the press and skim the annual report—you may be surprised at what you learn.

When pitching products and services, you want to incorporate whatever “intersections” between their operation and yours into your presentation. Whenever possible, use their words to illustrate your points and explain why you will make a good partner for them.

Establish credibility

When cold calling a prospect to whom you have no connection, you must demonstrate unassailable proof of your trustworthiness and ability to produce results and meet or exceed expectations. If you meet a prospect at a business association meeting or social event, in general you will be regarded as more trustworthy than a cold caller, but demonstrating your specific expertise and reliability will still be required.

Presenting your business card is step one, but if you neglected to bring cards (or you ran out), ask for your prospect’s card and in your email to confirm whatever preliminary agreements have been made (such as a telephone call or meeting to gather more information), be sure to include your company website address, LinkedIn profile address and links to two or three examples of work that the prospect would like to assess (I always send a link to this blog).

Follow-up

It seems so simple and basic, doesn’t it? But Freelance consultants, sales professionals and others have the unfortunate habit of failing to follow-up on potentially promising leads. Maybe you misplaced the prospect’s business card?

Showing persistence is another important element when pitching a potentially good client. Maybe your first email doesn’t wow them, or it gets lost in a pile-up of messages, so always follow-up if you don’t receive a reply. Generally, I consider it polite to wait at least seven days before reaching out again and to never follow-up more than twice.

Know what you want

Keep at top-of-mind the type of relationship you want to create with your prospect. Be clear about what that relationship would ideally look like from your perspective and how it will benefit both parties. You’re probably looking for ongoing projects or sales and referrals, too, more than just a one-off interaction. It may be too early to share that ultimate goal with the prospect, but keep your eyes on the prize as you set the stage at every touch point to achieve it, beginning with your focus on your potential client’s expectations and shaping an appealing client experience.

Thanks of reading,

Kim

Photograph: © Bob DeChiara USA TODAY Sports. Boston Red Sox relief pitcher Koji Uehara (now retired) was awesome in the 2013 American League Championship Series and World Series. His 2013 Earned Run Average was 1.09, as he struck out 38.1% of batters faced. Boston won the 2013 Series against the St. Louis Cardinals 4 games to 2. Koji won the 2013 Most Valuable Player Award in the ALCS, Boston v. Detroit Tigers.

Contacting the Prospect: Phone or Email?

Email is the preferred business communication format for most of us and the choice usually makes sense.  An email provides a written record of what the parties have discussed and any agreements that have been proposed and accepted (or not).

However, certain nuances of meaning may not be effectively transmitted in an email and for that reason, it is useful to understand when it might be advantageous to discuss certain subjects by telephone.  It is also useful to recognize when a face-to-face meeting will most likely be the ideal communication method.  Much depends upon your purpose, message and relationship with the other party, whether the topic pertains to a business matter or your personal life.

Furthermore, be sensitive to the time you choose to reach out, whether by telephone or email.  Your request for contact may get lost in the shuffle if you email or telephone on Monday morning, late afternoon on Friday, or on the day before a big holiday. 

Telephone when you would like to:

  • Build a relationship
  • Explain a complicated matter
  • Apologize for a product or service failure
  • Close a sale quickly and successfully

On the telephone, you will more easily convey your authenticity, express concerns, telegraph empathy and build trust as compared to what is usually possible through email exchanges, which can sometimes cause the writer to seem cold and can therefore lead to misunderstanding of intent.

For important goals, be advised that it’s sometimes easier for a prospect to say no when communicating by email, so if you’re hoping to get the green-light for a project or sale, pick of the phone and wager that speaking with you personally will persuade your decision-maker prospect to say yes.

When you must contact someone whom you do not know in order to jump-start a sale, picking up the telephone is what you do. A cold-call prospect who receives an email from an unknown party is almost guaranteed to interpret the outreach as spamming and no ethical sales professional wants that ugly slur attached to his/her name and reputation.  Over the telephone, you’ll be positioned to demonstrate that you are both legitimate and trustworthy.

Cold-calling takes considerable resolve and reliable sales data report that it’s effective only about 5% of the time, but you’ll improve your chance of success when you telephone the probable decision-maker.  If you encounter difficulty in reaching the prospect, experiment with the time frame; call at 7:30 – 8:30 AM (except on Mondays) or 4:30 – 6:00 PM (not on Fridays or the eve of a holiday).  When the prospect answers (s/he will!), ask if it’s a good time to speak. 

Choose email when you’d like to:

  • Simultaneously communicate with several people
  • Generate a written record of the discussion and resulting agreements
  • Follow-up
  • Ask a quick question

Should your cold-call prospect agree to evaluate information beyond what you’ve shared in the phone call, follow-up with an email in which you document the highlights of the conversation, especially time-sensitive action items. Remember to thank the prospect for taking time to speak with you and assess the usefulness of your product or service in his/her organization.

When evaluating which communication method might be most effective when planning to approach a sales prospect, consider first his/her rank within the company and probable decision-making authority, along with what you can learn or infer about his/her priorities, concerns, schedule and even age.  Younger and less senior staff members may respond more favorably to email or even SMS (text).

Both the telephone and email have their advantages throughout the sales process.  Know the preferences of whom you are communicating with (ask), remember your objectives and use the communication format that will bring to you the preferred outcome.

Thanks for reading,

Kim

Photograph: Natalie Wood in Sex and the Single Girl  (1964)

Speeding Up Your Sales Pipeline

How wonderful would it be if your prospective clients would just hurry up and make a decision about if and when they’ll give you a sale? Even if 80% decline, as predicted in Pareto’s 80/20 rule, think of the time and aggravation that you’d be spared.  There’d be no more chasing so-called prospects who either can’t or won’t green-light a sale for you.  Your numbers would probably increase, if for no other reason than you’d stop wasting time on lost causes and look for better possibilities.

Getting a commitment to either fish or cut bait in maybe a week or two is a fantasy, but learning how to get better at qualifying prospects is within reach and here are four tips to help you do just that.  Implement these tactics and you’ll move prospects through your sales pipeline faster than ever before.

1. Sell to the decision-maker

Is the person who you think is the prospect really the prospect? Does this person have the authority to make the decision and approve the budget? If not, there will be no sale until and unless you get in front of the real decision-maker.

Especially in B2B sales, a gatekeeper or other lower-level employee could be enlisted to find out the details and then report back to the actual decision-maker.  Alternatively, the decision could be made by a committee of senior staff members, one of whom may be speaking with you, but s/he alone cannot give the green-light without getting agreement from other committee members.

In either case, you’ll need to get around the stand-in, learn the identity of who has the most influence and focus your attention on addressing that person’s hot buttons, so that the sale can move forward at a faster pace.

Step One in ferreting out the identity of the real decision-maker is noticing the job title of the person with whom you’re speaking.  If s/he ranks lower than Director or Vice President, most likely there’s someone in the background pulling the strings.  Unless you’re selling office supplies, ask the stand-in if s/he is able to directly approve the budget and if there are others who might like to directly ask you questions about your product, service, or project.  Be respectful of feelings, but do encourage the participation in the sales process of the one who can sign the check.

2. Discover what worries your prospect

Get a big-picture understanding of your prospect’s most urgent and top-of-mind challenges and near-term objectives, as they apply to what you can bring to the table in terms of a product or service.  What does your prospect think will happen if the product doesn’t get purchased or the project doesn’t get done?  How will company leaders feel when the problem is resolved and objectives are achieved?

Learn as much as possible about what your prospect wants and how committed s/he is to achieving goals and resolving issues.  Ask “what” and “how” questions to discover these key insights.

3. Confirm that your solution is a fit 

Ultimately, all salespeople want to close deals. But ironically, it’s sometimes better to walk away from a potential sale if the product or service isn’t a good fit for either you or the prospect.  Pushing for a sale that won’t bring about the best outcomes never ends well and it should be avoided, even when you’re desperate to do business.

In these situations, your objective is about getting to “no” faster.  Then you can move on and pursue other prospects who may be better positioned to buy from you.  It’s  preferable to speed inappropriate prospects through the pipeline and devote the time saved to identifying and meeting with qualified prospects who might say “yes.”

To ensure that your product or service can solve the problem or help the prospect meet a goal, ask pointed questions and listen well to determine whether your solution will produce the best results and be cost-effective in the long run.

4. Learn the prospect’s timetable

Is there an urgent need or deadline that compels your prospect to take action and implement a solution quickly? If you know that to be true, you can most likely expedite the sale (and get the price you want, as well).  Ask questions to help yourself evaluate whether the prospect could be ready to do the deal in a week or two, or in months.

One important line of questioning should concern available funding for the proposed sale or project.  In some cases, the prospect would sincerely like to move forward, but there is insufficient political support in the organization for his/her agenda.

The information will allow you to adjust your expectations for the sale and decide if you should continue to pursue, pick up the thread in a few months, or close the book on a pipe dream.

Thanks for reading,

Kim

Image: Portrait of Evdokiya Nickolayevna Chesmenskaya (1780) by Jean-Louis Voille (1744 – 1806) courtesy of the State Tretyakov Gallery, Moscow