Two major errors many businesses make in marketing and selling.

Earlier this year I interviewed Rashid Kotwal from Revealed Resources.  His speciality is creating strategies to attract, convert and retain high value clients; that top 4% which give you 64% for your business.

Recently Rashid wrote a very useful article on “two major mistakes” that may be costing you business.  I thought you might find them valuable.  I did.

Take it away Rashid.
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Would you keep using a leaky bucket?  Of course not.  You'd either fix it or buy a new one.

The equivalent in businesses is throwing more money at lead generation and not converting prospects into clients.

The two errors are:

•    Not thinking from your customer's viewpoint, and

•    Not articulating your value in terms that are meaningful to them.

Human behaviour has not changed in millennia.

Some of the best marketing advice was written 100 years ago.

Obvious Adams was first published in the Saturday Evening Post in April 1916.  Written by Robert R. Updegraff, it's the story of an Advertising Man who became a legend by, you guessed it… coming up with "obvious" solutions.  Here's one.

Think from your customer's point of view.

What is it they want? What will make them choose you over your competition? Explain things from their point of view, not yours.

A classic mistake we see day in and day out, is glossing over how you produce your results.  You have a lot of expertise, but as a prospect I'd never know it because you never tell me.

The only way to differentiate yourself is to explain the value you provide.  Explain in great detail how you get your results and what they mean in real terms for your clients.

Don't assume your customers know all this.  They don't.  What's obvious to you because you do it day in and day out is not obvious to them.  And yes, it is about blowing your own trumpet.

Milwaukee based Schlitz became one of world's largest brewers for decades due to explaining the process by which they made beer.

Frankly, the fundamentals of brewing are the same for every manufacturer.  However, Schlitz told their patrons…

"We Double the Cost of Our Brewing to Give You Pure Beer. We spend a fortune on cleanliness. We wash every bottle 4 times, clean every tub, boiling vat, pipe and pump every time we use it…"

The ad goes on explaining how the beer is filtered, fermented, bottled and inspected. And that you don't pay any extra for all this attention to detail.

Quality is not an abstract concept. Schlitz took great pains to explain what quality meant in terms their drinkers would find important and relate to.

Schlitz was smart enough to understand who they were advertising to. Many organisations would have thought, "Well this is obvious – every brewer does this". 

And many of their competitors may well have laughed at their ads.

But at the same time none of their competitors followed their lead. And even if they had done, Schlitz was first – which is an unbeatable advantage.

This principle applies to any industry. 

Here's an example from a client in the construction industry.  They have two types of prospects.  Architects who recommend them and end clients who commission the projects.

When we started together they believed price was a big factor in winning or losing a job. We set out to prove otherwise.

People buy based on perceived value.  Will I get value for the money I spend?  The best way of figuring out what value you provide is to ask your clients.

By extensively interviewing their clients we found their buying criteria hinged on three things.

  • Quality,
  • Cost
  • Time

Everything else was superfluous.

No one bought on price alone and most avoided lowest price vendors knowing they'd get stung later on.

Armed with this knowledge straight from the horse's mouth, we created marketing material that explained exactly how the organisation ensured each of those criteria were met in nitty gritty detail. We used examples of past projects in the same vein to illustrate the point.

But it doesn't stop there. Knowing what your clients are looking for means you can quickly and effectively close more business (sell) by tailoring solutions to their exact requirements.

However, many businesses operate on two assumptions that are often never tested and end up costing them dearly.

The first is assuming their clients know and fully understand the value they get for their money. The second is assuming what they themselves believe is valuable to their clients is actually the case.

Having worked with businesses in 40+ industries ranging from single person operations to multi-nationals, I can tell you many are completely wrong on both counts.

What you think you're doing for your clients and what they truly value can be poles apart.  And if that's the case you spend more and more effort and money promoting aspects which don't advance sales, rather than spending your effort in areas which will.

Maybe that's the case in your business?

There's only one way to find out for sure. Ask your clients. Or better yet, get us to do it for you. As expert, completely independent interviewers your clients will tell us the truth and give you insights as to where you can improve and sell more.

Using our fresh eyes on your business will also help you find "obvious" business improvement solutions you may have missed because you're too close and mired in the day to day activities.

Interested? Call us on 0414-913-334 for more information, or go to www.revealedresources.com.
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Thanks Rashid. 

There are a number of useful takeaways here for you:

  • Think from your customer's point of view - What is it they want? What will make them choose you over your competition? Explain things from their point of view, not yours.
  • The only way to differentiate yourself is to explain the value you provide, and the best way of figuring out what value you provide is to ask your clients.  Don’t assume you know it.
  • Be first with your point of difference.  Any one who follows your lead will be seen to be copying.
  • Knowing what your clients are looking for means you can quickly and effectively close more business (sell) by tailoring solutions to their exact requirements.
  • And if you don’t know, you’re likely to spend time and money promoting aspects which don't advance sales.
  • No-one buys on price alone.  People buy on perceived value.

My earlier interviews with Rashid may be found here:
https://www.profitsleakdetective.com/blog/366-how-to-gain-high-value-clients
https://www.profitsleakdetective.com/blog/367-are-you-systematically-using-the-most-effective-form-of-promotion

Have you asked the Million Dollar Question?

When clients approach me for coaching, so often, they are not getting the clients they need, the right clients.  Eight times out of ten this comes down to not knowing what is working, and what is not working, and why it is not working.

For more than 28 years I’ve been helping small business owners plug the profit leaks in their business and restoring their cash flows by assisting them understand where there profits really come from, where they’re leaving money on the table, and where their sales are costing them profits.

If you would like to discuss with me how you might do that, book a Strategy Consult here

© Copyright 2017 Adam Gordon, The Profits Leak Detective 

Is your plan fit for purpose? 

In other words, does it do what it is meant to do?  Now the question I have for you is, just what is it meant to do?

Let’s start by looking at what is a “business plan”.  Actually, I prefer the term “strategic business plan”. 

When you don't know where you are going then how do you know when you get there?  That's what a strategic business plan is all about. 

It starts with where a business is NOW (its strengths and weaknesses), WHERE it wants to get to (the strategic bit 3-5 years out), and HOW it proposes to do so - the Business Plan bit.

Breaking it down into its elements:

A Strategic Plan:

  • is for businesses, organisations and business owners that are serious about growing their business.
  • is used for planning, implementing and managing the strategic direction of an (existing) business.   I’ve put the word ‘existing’ in brackets, as many people say a strategic plan is only for existing businesses. I don’t agree; even start-ups need to know where they are going.
  • is used to provide focus, direction and action in order to move the business from where they are now to where they want to go.
  • focuses on building a sustainable competitive advantage and looks to the future.
  • is critical to prioritising resources (time, money and people) to grow the revenue and increase the return on investment.
  • generally covers a period of 3 to 5 years

A Business Plan

The Business plan is operational (more detail) and is in fact a "tool" that is used to implement the objectives/targets of the Strategic Plan.  This now moves into things like planned Sales volumes/prices, production costs, inventory turnover, cashflow management, employee numbers (rates/utilisation/down time) etc. 

Your business plan:

  • determines how the business will successfully achieve its strategic objectives
  • is a formal statement of a set of business goals, the reasons they are believed attainable, and the plan for reaching those goals.
  • may break the plan down into the key areas of the business; marketing, operations, and finance.  It beaks the business down into its components and looks across all functions.  Or
  • a series of Action Plans to achieve the business goals
  • identifies potential troubles spots ahead
  • may also contain background information about the business or team attempting to reach those goals.
  • is, typically, normally no more than one year.

There are two main purposes of business plans

They will determine how it is prepared, and presented – to do what it is meant to do.

Obtaining finance is the first of these, meeting the requirements of a financier – a fund raising tool.

As my bank manager once wrote to me, commenting on a business planning workshop I was developing: “Don't forget to tell us about you and your business! This is effectively who we are lending too. I tell my customers that their business plan is their stage – it’s their opportunity to take the floor and convince me as to why I should "invest" in them and their business.

I know what the economy is doing. I know what different industries are doing in the market. What I don't know is why their business is different to Joe Bloggs down the road. I don't know why their life experiences will make this business a success. I don't know what gives their business that competitive advantage. I don't know them, I don't know their business. And don't assume! I'm a banker, don't assume I know what the business does specifically!”

Your strategic business plan should include your business model, budget, cash flow projection, and how and where you will use the funds. 

“A business plan is all conceptual until you start filling in the numbers and terms. The sections about your marketing plan and strategy are interesting to read, but they don't mean a thing if you can't justify your business with good figures on the bottom line.

You do this in a distinct section of your business plan for financial forecasts and statements. The financial section of a business plan is one of the most essential components of the plan, as you will need it if you have any hope of winning over investors or obtaining a bank loan. Even if you don't need financing, you should compile a financial forecast in order to simply be successful in steering your business.”  (Elizabeth Wasserman, Inc.Com)

"This is what will tell you whether the business will be viable or whether you are wasting your time and/or money," says Linda Pinson, author of Automate Your Business Plan for Windows (Out of Your Mind 2008) and Anatomy of a Business Plan (Out of Your Mind 2008),

The second purpose is the road map. In the road map, you set out your destination, and how you plan to get there.  That doesn't mean you don't gave flexibility to change your route if road conditions change, but it does enable you to progress to your desired destination.

It’s an internal document, to guide you and your team, put you on the path, remind you of the steps you must take, when you must take them, and the outcomes those steps should achieve.  It tells you how you will achieve your operational and financial objectives over the period of the plan.

A couple of other issues arise:

The first is implementation. The majority of business plans aren't implemented. I've read studies suggesting the figure is as high as 70%. I'd agree with that. Over the last 28 years my most successful clients have been those who implemented their business plan. The rest just stuck it their drawer, and said they had a business plan.

The second issue is measurement. Most businesses don't measure what is going on in their business; which lines are more profitable, and which are less profitable. They may measure their sales by products or customer groups, but rarely their gross profits by these groups. A good business plan will provide lead and lag indicators to guide the business and help make informed decisions.

There is a third issue – business failure!

Just in case you thought you might not really need a business plan, after all, you have a clear idea in your head of where you are going, and know your market. 

A survey by accounting software provider CCH and global information services group Wolters Kluwer, revealed SMEs see inexperienced management, a bad business model and lack of access to capital as other key reasons for small business failure.

Of those surveyed, 61% of SME operators said small businesses failed because of an inability to manage costs, 50% said inexperienced management, 50% said poorly designed business models or no business plan, 49% said insufficient capital, 37% said poor or insufficient marketing, and 35% said insufficient time managing the books.

Note that 50% - sure, there are other factors, but even those would be addressed in a good business plan.  As the old saying goes “Failing to plan means planning to fail!”

Make sure your business plan is “fit for purpose”, and does what it is meant to do.

How Well is Your Business Performing?

When clients approach me for coaching, clients with businesses that are underperforming despite the crippling hours and effort the owner is putting into them, they are sometimes held back by lack of knowledge of what is possible.  A lack of focus of potential improvements leads to a lack of control over their business, and eight times out of ten that lack of control comes down to a lack of knowledge of what is happening in the business, and what their peers are achieving.

  • For more than 28 years I’ve been helping small business owners plug the profit leaks in their business and restoring their cash flows by assisting them understand where and how they may change their business to be a leader in profitability, productivity, and competitive advantage.  I assist you analyse:
    The strengths, weaknesses opportunities and threats of your business
  • Determine where you want to be – clear, achievable goals, and
  • How you are going to get there – strategies to achieve your goals

This is sometimes known as the NOW – WHERE – HOW model.

If you would like to discuss with me how you might do that, book a Strategy Consult here

© Copyright 2017 Adam Gordon, The Profits Leak Detective 

But planning is indispensable

Former U.S. President Dwight Eisenhower is the attributed source for these words, which in full state "In preparing for battle, I have often found that plans are useless, but planning is indispensable."

What is of critical importance to your business is setting specific, measurable long term goals, and doing so in the context of an ideal world.  The intent is to help you avoid ‘creeping obsolescence’ of incremental changes that merely react to events rather than taking a strategic approach to what might be possible for your business.

Of course, the outcome of such thinking may mean major change in your business, so understanding how to implement change is important.  Change will only occur when the returns of change, whether they be financial or emotional, are greater than the level of discomfort from the current situation plus the cost of making the change.

I know it is nearly mid-year, but have you asked yourself what you'd most like to accomplish in 2017?  We all make those resolutions at the beginning of the year, but then chaos intervenes.  I have found it useful as I approach mid-year, to take a deep breath and relook at where I’m going and how far my business has progressed along the path I set.  You should do so as well.

Past years have been about completion.  Make this year about "creation"; a year where you lay the groundwork for the next phase of your life and for your business. It's a time to decide what you'll no longer stand for and what you're now committed to achieving with your business

I undertook a review of past clients to determine what led them to set major goals which required significant change in their business. Underlying the key drivers of change was a feeling of discomfort.  Do you feel discomfort from any of these factors which my review highlighted as the biggest drivers of change?

•    Lack of a strategic direction – “I don’t know where we’re going!”

•    Lack of marketing skills

•    Lack of good systems and procedures

•    Poor profitability

Poor profitability becomes the focal point of the pain and discomfort, but profitability is equally the reward for successfully making the change.

If you have done the thinking, now is the time to move beyond the thinking to the actual planning.  This means you must become specific about your goals – what are you seeking to achieve this year, and next?  And what changes does that mean for your business?  Paul Meyer said: if you aren’t achieving what you want to achieve, it is probably because your goals are not clearly enough defined.

You have probably seen the acronym about setting SMART goals:

  • Specific - In addition to specific, don't stretching, systematic, synergistic, significant and shifting, round out the picture?
  • Measurable - M means measurable, but I also recommend meaningful, memorable, motivating and even, magical
  • Achievable - A is an achievable goal but A also needs to stand for action plans, accountability, acumen and agreed-upon
  • Realistic - R means relevant, but it also stands for realistic, reasonable, resonating,  results-oriented, rewarding, responsible, reliable, rooted in facts and remarkable.
  • Time-based - T means time-based and it also represents timely, tangible and thoughtful

Smart goals give you the drive to achieve change.

So you have created your goals, and they’re smart goals.  Now for the bad news.

The bad news is about the difference between formulating goals and strategies to drive them, and actually making it happen.  Not surprisingly this has led to a number of studies and comments:

•    Strategy execution is more important than the quality of the strategy (Ernst & Young, Measures that matter report on 275 Portfolio Managers – 1998)

•    “Fewer than 10% of strategies are effectively executed” (Walter Kiechel, Corporate strategies under fire, Fortune Dec 27 1982)

•    “70% of failures are due to poor strategy execution by senior management” (Chan and Colvin, Why CEOs fail, Fortune, June 21 1999)

•    “Superior execution is required to achieve excellence”  (Frank Blount & Bob Joss, Managing Australia, 1999)

•    “Execution is more important than good vision” (Kaplan R, The strategy-focused organisation, Harvard Business School Press, 2000)

•    40 times more of the literature is dedicated to strategy formulation than to execution (Dulmanis 2003)

You see the common thread here: businesses develop plans and strategies but they don’t make them happen.  That’s why they say the three “Es” of business planning are Execution, Execution, Execution.

So why are plans useless but planning indispensable?

Plans are useless in the sense that the year ahead will always have some unexpected twists and turns, an X-factor that neither you nor anyone else was able to predict.  Products change, prospects change, market environments change.

Eisenhower had been a General before being a President and he knew the old aphorism that no plan of battle survives the first shot.

Planning is indispensable because in formulating your plans, in looking at what was completed in the year gone (and why and why not), and what you need to create and change in the coming year you will have examined and analysed all the information you have on your business.  Hopefully you will also have looked at what is happening in your marketplace, your local economy, and with your competitors.

Various planning tools such as SWOT and Scenario Planning, which I have discussed previously, are very useful.  I’ve also written extensively on the importance on having information and data on your business activities which can be analysed and projected.  The knowledge provided from such analysis is a key input to your planning process. 

Benchmarking is another tool I recommend - reviewing your business against industry averages in your sector to highlight opportunities for improvement in yourbusiness.

Having that analysis and examination available means that you will be able to hold fast to your direction, to keep focused on your goals even as the reality of twists and turns in your market confronts you.

The indispensability of action

The tag line in my previous business was “improve, change, profit”.  More profits won’t eventuate unless you take action to improve and change your business.

Action leads to execution of your plans.  Your plans will never be perfect, but doing something, getting it moving, is more important than developing the perfect plan.

The plan is useless if it is not executed, but if you act, the planning you put in will be indispensable.

How Well is Your Business Performing?

When clients approach me for coaching, clients with businesses that are underperforming despite the crippling hours and effort the owner is putting into them, they are sometimes held back by lack of knowledge of what is possible.  A lack of focus of potential improvements leads to a lack of control over their business, and eight times out of ten that lack of control comes down to a lack of knowledge of what is happening in the business, and what their peers are achieving.

For more than 28 years I’ve been helping small business owners plug the profit leaks in their business and restoring their cash flows by assisting them understand where and how they may change their business to be a leader in profitability, productivity, and competitive advantage.  I assist you analyse:

•    The strengths, weaknesses opportunities and threats of your business

•    Determine where you want to be – clear, achievable goals, and

•    How you are going to get there – strategies to achieve your goals

This is sometimes known as the NOW – WHERE – HOW model.

If you would like to discuss with me how you might do that, book a Strategy Consult here

© Copyright 2017 Adam Gordon, The Profits Leak Detective 

Is your first thought of the person who makes the sale – the “salesman”? 

And what image then comes into your mind?  Is it the “used car salesman”, or the “real estate salesman”?  Consider this public comment by the head of the newly independent East Timor on a former Australian Prime Minister:

His (Paul Keating) manners and discourse reminded me of a second-hand car salesman in downtown Los Angeles.  Jose Ramos Horta October, 1999

Why is it that salesmen, and excuse the gender specific in this day and age, but it is always “salesmen”, that generate this response?

Does this kind of thinking cause you not to enjoy selling – that in order to sell you need to act in a way that is not in alignment with your own values.

Consider this reality - Everybody lives by selling something - business begins with a sale.  Without a sale, you don’t have a business.  But as copywriting pioneer Claude Hopkins says, “any…attempt to sell, if apparent, creates sales resistance.”  

Sue Barrett, chief executive of forward thinking sales advisory Barrett and online sales education and resource platform http://www.salesessentials.com puts the real situation well:

“Whether we call ourselves a salesperson or not, if we have an idea, product, service, skill, talent, or opportunity that we can offer to another and they can benefit from, then we need to be able to sell.

Most people, whether they are a partner in professional services, the MD of a business, a tradesperson, customer service, sales, baker, not-for-profit or administration, need the ongoing custom of members, patients, supporters, sponsors or clients to make a living.

Yet many people are still confused by 'sales'. In fact, often when sales is mentioned you see people visibly recoil at the concept and some even go so far as to object to you using the term sales.

Why is this?

Because many so called 'legitimate' sales practices we experience are nothing more than manipulation and deceit, aggression and intimidation, or hard sell, pressure tactics. Whether we are conscious of it or not, most of us don't like how selling is being sold to us. And we don't blame you.

Despite the prevailing paradigms of the 20th century 'old school selling' tactics, highly successful sales people have always known the best way to sell. They know how to explore clients' needs and help them get what they want. They know that trust supersedes like. They practice a range of life skills which are present intrinsically, whether we know it or not. They are applying skills which proactively forge honest and open relationships based on trust, transparency, respect, and doing what we said we would do. This is their competitive edge.”

There’s a key clue in Sue’s last paragraph above; “highly successful sales people have always known the best way to sell.  They know how to explore clients' needs and help them get what they want” – the best way to sell is to find out the client’s real needs.  You’ll do that by listening, not talking.  You should ask the right questions, but then listen to the answers.

The ancient Greeks had it right, "We have two ears and one tongue so that we would listen more and talk less."  The salesmen who try and talk through you are the ones that give the profession a bad name, and create “sales resistance”.

Mark Ford advises there are essentially three fundamental skills needed to acquire wealth.

And the first of these is selling – the skill of creating a sales message that works.

Another is marketing – the skill of finding the place to sell your message profitably.

The third is managing profits – the skill of managing business protocols and managing people

As I wrote in “You can lead a Horse to water, but…” marketing can’t fix a sales problem.  Salesmanship is a fundamental skill for your business.

There’s another issue you need to address.  These days it is almost impossible to meet a product salesman in the business-to-business sector.  They all sell ‘solutions’ in the hope this magic word will automatically lead to the sale.  And they hope that just promising a “solution” will instantly differentiate them from their competitors.

It’s an overly (and wrongly) used marketing word. You see businesses use the term “solutions” all the time.  They tell you they offer a “solution”.  Some businesses even use the term as part of their name.  Do a quick Google check – you’ll be amazed.

Now there is nothing wrong with providing solutions.  In fact, you wouldn’t be in business if you didn’t have a product or service that someone wanted.  As part of your sales conversation you must demonstrate that the features and benefits of your product will solve their problem, and that they can believe your claims.

That is where the art of listening comes in; you must understand the nature of the client’s problem, the depth of concern it causes them, and the value to them of removing the problem.   Ask the right questio, .... and listn.  Businesses, and people, buy on perceived value, their perception of value.

As Sue Barrett puts it, “Simply giving salespeople some training and telling them to talk about solutions, rather than products won’t make the difference.”

Good salesmanship is all about finding that one spark that leaps the gap between a prospect client’s most deeply held desires, the value they place on them, and what your product can do.

Andrew Griffiths suggests there are ten common ways to ruin a sale:

1. Salespeople who are unprepared when making a sales presentation.

2. Poorly presented salespeople (dirty or wrinkled clothes, poor personal grooming, body odour, etc).

3. Poor or non-existent product knowledge

4. Salespeople with a bad attitude - everything is a hassle.

5. Salespeople who don’t listen to what the customer wants.

6. Making a promise to follow up with a customer and then not doing it.

7. Not having clear sales goals.

8. Not being “present” with the customer - the sales person’s mind is elsewhere.

9. Not being compelling and definite when it comes to making a recommendation to a customer.

10. Poor communication skills - no eye contact, mumbling, and one-word answers.

No doubt we have all been guilty of a few of the above, but now is a good time to stop and evaluate whether you or any of your staff are guilty of any of these ten things.

Knowing where you are going wrong is a great place to start to get it right.

Have you asked the Million Dollar Question?

When clients approach me for coaching, so often, they are not getting the clients they need, the right clients.  Eight times out of ten this comes down to not knowing what is working, and what is not working, and why it is not working.

For more than 28 years I’ve been helping small business owners plug the profit leaks in their business and restoring their cash flows by assisting them understand where there profits really come from, where they’re leaving money on the table, and where their sales are costing them profits.

If you would like to discuss with me how you might do that, book a Strategy Consult here



© Copyright 2017 Adam Gordon, The Profits Leak Detective 

But wait, there’s more!

There are opinions, and then there is data – facts if you like.  I’ve recently been writing about why referred customers are better customers and suggesting you should make referral a systematic part of your promotional program and how you should go about it. 

In “The Simplest Way to Get More Business” we discussed the “why” you should have a referral program, ”how” to go about it, and the ”mistakes to avoid”.

I then interviewed Rashid Kotwal from Revealed Resources.  In Part 1 of our interview (How to Gain High Value Clients) Rashid discussed the importance of high value clients and what they can mean for your business.  High value clients are few in number, but provide the greater part of your sales, and profits – the 80/20 Rule.

In Part 2Are you systematically using the most effective form of promotion?” Rashid looked at why you should make referral a systematic part of your promotional program and how you should go about it.

Clients you get from referrals are more likely to become high value clients.  After all, a client who thinks enough of you to refer you is unlikely to refer you to a dud.

Not surprisingly, there are other experts similarly extolling this sales tool, and backing their thoughts with some research.  One of them is Tim Wackel

Welcome to this Two Minute Sales Tip with Tim.

Ladies and gentlemen for the past couple of days I’ve been spending some time catching up on some reading, and I’ve been focusing my energies on this area known as referral selling. So I would like to share with you today four fun, interesting and relevant statistics when it comes to the world of referral selling.

Fun Fact #1: According to the folks at Dale Carnegie, 91%, that’s right 91%, of customers say they give a referral, but only 11% of salespeople actually ask for them.

Fun Fact #2: Research done Nielsen reports that people are four times more likely to buy when referred by somebody that they know.

Fun Fact #3: Heinz Marketing, which researched over 600 companies, came up with this very interesting insight. Companies with formalized – I really have to underscore the word formalized – companies with formalized referral programs experience 86% more revenue growth over the past two years when compared to the rest. And yet, only 30% of the companies they surveyed actually have a formalized referral program. 
This seems so fundamental; but only 11% of salespeople are asking for referrals. What’s going on with the 89% of the rest of you?

Last but not least, Fun Fact #4: According to the American Marketing Association, offering a reward increases referral likelihood, but the size of the reward really doesn’t matter. As a matter of fact,- I found another article by the University of Chicago that said non-cash incentives are actually 24% more effective at boosting performance than cash incentives.

So here are three takeaways for you today…

Number one, if you’re not asking for referrals, you’re probably missing out on opportunities. It’s just that simple.

Number two; I would really strongly encourage you to formalize a process for getting referrals. Here’s the challenge. This seems so fundamental; this seems so easy, yet we discover from the very first statistic that only 11% of salespeople are asking for referrals. What’s going on with the 89% of the rest of you? Well you know what, we’re busy. We get caught up in the day-to-day and we simply forget to do it. So please, get a formalized process around asking for referrals. Get a plan and put it into place.

Number three, give people a reason. Incentivise people to share. Whether it’s simple Starbucks card or maybe it’s an AMX Gift Check, you decided. According the University of Chicago, the non-cash incentives are 24% more effective. So it’s not like you have to spend a ton of money. Just let people know that you appreciate them giving you that referral.

So, in closing, I would like to ask for your referral. If you’ve been following me for a while, if you enjoy these two minute tips, if you like the webinars that we’re doing, and you know somebody who needs a keynote speaker, you know somebody who has an upcoming sales meeting or you know somebody who is looking for an executive presentation coach, just reach out and connect us. If the referral turns into an opportunity, we’re going to send you an iPad Mini as a way of saying thanks for trusting us with that opportunity.

You can get more ideas and answers from Tim at www.timwackel.com.

If you would like to be part of my referral program

I don’t have an iPad mini to give away, but I will reward you for any referrals you give me, with my “The Profit Leak Detector – Tell Tale Signs to put Cash Back in Your Business”, This email address is being protected from spambots. You need JavaScript enabled to view it. and give me the business name, contact, email and phone number of the people you are referring, and I’ll immediately forward this valuable book.

© Copyright 2017 Adam Gordon, The Profits Leak Detective 

But Must if they Want to Be Rich and Successful

Most people go into business because they are good at something, frequently a technical skill whether it be as a lawyer, an electrician, a vet or a builder. 

Such people usually make what Michael Gerber called - The Fatal Assumption:  if you understand the technical work of a business, you understand a business that does that technical work.  

They are looking to sell a product or service they have, and hope to find a market for it.

But as the famous marketer Dan Kennedy said, “Hope is not a strategy!” 

The problem starts with whether they asked the right question before they went into business?  My guest today believes there is a million dollar question that most business owners can’t answer, that if they could answer it, it would literally open the financial flood gates…

The answering of this question is the reason most million dollar and billion dollar companies exist and enjoy the kind of success they have.

He say it works in any industry or niche…and it works for big business and small business…

My guest today is Mal Emery from http://www.malemery.com/

For those of you who don’t know Mal, as a Perth based entrepreneur, he won national recognition with his ‘Street Smart’ money making strategies, helping people in hundreds of different categories and industries to turn their businesses into money making machines.

In Australia, Mal Emery has been dubbed the “Million Maker” and the “Napoleon Hill” of the 21st Century for his uncanny ability to show ordinary folk where the money is in business.

Arguably he is responsible for helping create more first generation millionaires and multi-millionaires in business than anybody else in Australia.

Mal is a “self-made from scratch” multi-millionaire, bestselling author, business coach and mentor to 1000’s of business owners and Coach of the Coaches nationally and internationally.

He has raised himself to the top of 4 professions – marketing, sales, speaking, coaching, consulting and mentoring.

Well known for his remarkable ability to think outside the square, he ventured into his first business at the age of 22 when along with several other staff members he was fired from a job with ACI Crown Coning, which stifled and frustrated the already budding entrepreneur within.

This led to a discovery of a latent passion – for business!  Over the last 42 years, he started, bought built and sold approximately 25 businesses using his proven potent style of marketing.

His latest entrepreneurial offering being a child care centre built from scratch in 2016, and more recently, one of the largest coaching and consulting business on the planet.

No one else in Australia can claim to have opened the door to the money vault and turned up the money metabolism for others more than him.

This is not just for braggadocio but to impress upon you the value of listening to Mal’s street smart marketing advice.

Besides, let’s face it, if you’re going to learn from someone, you have to know if they really know what they’re talking about.

He has had 5 books in bookstores that have sold like hotcakes including “Your Right to be Rich” and “EXPOSED – Zero to a Millionaire in Three Years or Less in Your Own Business!”, “EXPOSED – Recession Proof Your Business and Income”, “7 Keys To Making $100,000 in 100 Days” and “Your Marketing Sucks and You Know It”. Amway even made ‘Your Right to be Rich’, the book of the month & ordered 7400 copies.

Mal answered 4 questions on “The Million Dollar Question Business Owners Can't Answer but Must if they want to be Rich and Successful".

1.    What is the million dollar question?

2.    Why is that question so important?

3.    What is the answer to the million dollar question?

4.    What is the next step?

To get more information or resources follow Mal on his website at http://www.malemery.com/ and get his free report “How to get Hundreds of Thousands of Free Publicity for your Business”

Some more takeaways you will find useful

The key question – what should a business owner be selling?

Prospects do not have system for buying, they only have a system for not buying – e.g. I need to sleep on it, or I need to ask a friend, I’m only looking etc.

If the prospect has a system for not buying, you need a better system for getting them to buy.

Rig for success by having a system for everything.

You need to sell the prospect what they want most, and not necessarily what you have for sale.  You might need to create what they want most.  Selling then becomes a whole lot easier. 

So ask them, research, do a survey, and come up with the “unique customer buying advantage”.  You need to point out the point of difference for the prospect.

Most people go into business for the wrong reason, e.g their passion, or their trade.  People buy a solution to their problem, and not your product or service.  With all the clutter and noise in the marketplace, this approach works less than it ever did.

You need to reverse engineer your business, based on what are the prospects biggest fears, frustrations, wants, desires and needs in your market, not necessarily what you have on display.  These are emotional factors, and the most powerful of these is fear.  Fear gets us into action. 

Enter the conversation people are having. 

Have you asked the Million Dollar Question?

When clients approach me for coaching, so often, they are not getting the clients they need, the right clients.  Eight times out of ten this comes down to not knowing what is working, and what is not working, and why it is not working.

For more than 28 years I’ve been helping small business owners plug the profit leaks in their business and restoring their cash flows by assisting them understand where there profits really come from, where they’re leaving money on the table, and where their sales are costing them profits.

If you would like to discuss with me how you might do that, book a Strategy Consult here



© Copyright 2017 Adam Gordon, The Profits Leak Detective 

How to Gain High Value Clients Part 2

Referred customers are better customers.  We’ve been looking at why you should make referral a systematic part of your promotional program and how you should go about it.  In “The Simplest Way to Get More Business” we discussed the “why” you should have a referral program, ”how” to go about it, and the ”mistakes to avoid”.

I then interviewed Rashid Kotwal from Revealed Resources.  In Part 1 of our interview (How to Gain High Value Clients) Rashid discussed the importance of high value clients and what they can mean for your business.  High value clients are few in number, but provide the greater part of your sales, and profits – the 80/20 Rule.

And clients you get from referrals are more likely to become high value clients.  After all, a client who thinks enough of you to refer you is unlikely to refer you to a dud.

Do you just stumble over them, accidently, or are there things you can do to make life a little more certain?  The answer to that question is YES

Getting High Value clients is about opening doors, deepening relationships, and closing the business.  Finding, and keeping, high value clients can make such a difference to your sales, and cash flow.

In Part 2 of our interview (“3 things you must do to get new high value clients”) Rashid looks at how to use a Referral Kit to win high value clients, and the role “constant communication” plays in winning such clients.  To do so he answered two questions.

1.    Why businesses need a referral kit (read lead magnet), and

2.    How to use constant communication to move people down the sales funnel until they’re ready to buy.

There is a mine of more information or resources on Rashid’s website, https://revealedresources.com/

They include:

A Free Book on “10 Strategies to Attract High Value Clients”

His Accelerated Business Growth Program: http://www.revealedresources.com/accelerated-business-growth-program/

Practical tips - www.revealedresources.com/practical-tips

Just need some ad-hoc marketing, sales or business advice? Our 2 Heads Sessions will help get you on your way without long term commitment. http://www.revealedresources.com/two-heads-are-better-than-one-business-performance-improvement-program/

Client Interviews & Testimonials: www.revealedresources.com/testimonials/

Free Marketing Course: http://www.revealedresources.com/free-marketing-course/

Some more takeaways you will find useful

  • When asking someone for a referral, you need to be specific about the person or business you are seeking to be referred to.  It certainly isn’t “anybody”!    You need to be able to narrow down the targets you are seeking.
  • The person making the referral is likely to be busy, and not inclined to make the sale for you.  Providing them with a “Referral Kit” which contains the material you would initially send out to a prospect, allows the referrer to just give them to a prospect to educate them.  That kit needs to warm up the prospect, or do the sale for you.  It takes away the sales pressure the referrer might feel.
  • Alternatively, ask your referrer for a list of names that meet your criteria, and a letter from them that you can send out.
  • The minute you give a referral, you are transferring trust.
  • Constant communication is required to move people down the sales funnel.  There are a number of steps, and they all involve education:
    o    There are those who don’t know they have a problem, until it confronts them;
    o    Once they become aware of the problem, they are looking for possible solutions;
    o    They then narrow down the supplier/s they want to deal with;
  • Constant communication moves people down from ‘slight awareness’ to ‘I’m ready to buy’.  It has to be designed in such a way that it maps out where the prospect is in that journey.
    o    The person who is just starting to look needs something simple.  It might be a Fact Sheet (The 7 Things you Need To …..).  It might only be 1 – 2 pages.
    o    Once the prospect is on that list as a potential client, you keep giving them a little more information to start to build “know, like, and trust” until they are ready to buy. 
  • The “90 Day Rule” – if a prospect hasn’t heard of you within 90 days, they will forget you.  You must communicate with your prospect at least once every 90 days.  Once a month is better.
  • Another mistake often made, is failing to tell the prospect all the things you can do for them.  If you don’t tell them, they won’t know.

If you would like to be part of my referral program

And receive my reward, “The Profit Leak Detector – Tell Tale Signs to put Cash Back in Your Business”, contact me This email address is being protected from spambots. You need JavaScript enabled to view it.and give me the business name, contact, email and phone number of the people you are referring, and I’ll immediately forward this valuable booklet.

© Copyright 2017 Adam Gordon, The Profits Leak Detective 

Attract, Convert, and Retain

You will know not all customers are created equal and have no doubt heard of the 80-20 Rule; 80% of your sales will come from 20% of your clients.

Of course it is never an exact 80 – 20 relationship, but the principle is very true; a few high-value customers will provide the large part of your sales, and profits.

That’s easy to say, but how do you find, and keep, high value clients who can make such a difference to your sales, and cash flow.

Do you just stumble over them, accidently, or are there things you can do to make life a little more certain?

The answer to that question is YES, and that’s why I interviewed Rashid Kotwal from Revealed Resources.

For those of you who don’t know Rashid, he works with Business Owners and Managing Directors in industries ranging from Professional Services Firms, to Construction and Manufacturing, who want to both rapidly and sustainably grow their business revenue and profit.  He also works with sales managers and teams in both the B2B and B2C area to shorten sales cycles and improve conversion rates.”

His speciality is creating strategies to attract, convert and retain high value clients; that top 4% which give you 64% for your business.

Getting High Value clients is about opening doors, deepening relationships, and closing the business.  To do so, Rashid creates marketing systems which attract and engage your ideal prospect, moving them down the sales funnel until they’re ready to buy. 

Rashid answered 3 questions on “3 things you must do to get new high value clients”. 

1.    What are some quick mechanisms businesses can use to open doors?

2.    Why businesses need a referral kit (read lead magnet), and

3.    How to use constant communication to move people down the sales funnel until they’re ready to buy.

In this video, Rashid answers the first of these.  Look for answers for the next two in next weeks blog.

There is a mine of more information or resources on Rashid’s website, https://revealedresources.com/

They include:

Some takeaways you will find useful:

People don’t like to be sold, but they like to buy.  If they are serious, buyers are likely to go online and do some research before they go to the market.

When a buyer does find a possible product or service, they need to find if it, and the supplier (you), suits them.

You need to have something to start a “conversation” with the buyer and help sell you as an expert.  That “something” is called a “Lead Magnet”.

You also need to be able to explain what you do in layman terms, to make the prospect comfortable.

The content (articles, white papers, case studies etc.) you produce should set you up as an authority figure in your field.  The more quality content you produce, the more people will trust you, and come to you.

If you are in the B2B field, LinkedIn is a useful way to open the door to the type of prospect you are interested in.  Search for such people and ask to be connected.  Don’t make the mistake of commencing the interaction with sending them ME-ME material.  Constant communication is important, so send them useful material that you source. 

Educate and provide value before you start to move the prospect down the sales funnel.

Then lead the conversation into promoting what you provide.  For that, you will need to introduce a Call to Action in your communication.  You do have to sell.

If you would like to be part of my referral program

And receive my reward, “The Profit Leak Detector – Tell Tale Signs to put Cash Back in Your Business”, This email address is being protected from spambots. You need JavaScript enabled to view it.and give me the business name, contact, email and phone number of the people you are referring, and I’ll immediately forward this valuable booklet.

© Copyright 2017 Adam Gordon, The Profits Leak Detective 

But often the most Overlooked

We all know the most effective form of promotion is Word of Mouth.  It’s effective because when someone we know and trust tells us about a product or service they use, and recommends it, if we have that need we will more than likely buy it.

The weakness of WoM is that it is spontaneous, unplanned and not in our control.  But it can be.
You can take WoM to another level, and systematise it, through …….. referrals.

What are Referrals in Marketing?

One of the most overlooked areas of growth comes from your current clients.  But you shouldn’t leave it to chance.   The key is to develop a system which is repeatable.  I’ll get to that in a minute.

Referral marketing is a method of promoting products or services to new customers through referrals, usually word of mouth. Such referrals often happen spontaneously but businesses can influence this through appropriate strategies.

Referral marketing is a process to encourage and significantly increase referrals from word of mouth, perhaps the oldest and most trusted marketing strategy. This can be accomplished by encouraging and rewarding customers, and a wide variety of other contacts, to recommend products and services from consumer and B2B brands, both online and offline.  (Wikipedia)

Do you have a “referral system" in place for your existing clients?  You should. Let’s look at “why”.

Why you should have a referral program

Referred customers are just better customers: They have 20% higher Average Order Values (AOV), 25% higher Lifetime Values (LTV), and are overall 25% more profitable than customers from any other channel. An article in eMarketer notes: "If you're not running a referral program, you're falling behind your competition."

Referrals are the lowest hanging fruit for business sales, but odds are that your company is one of the 80% of small businesses that don’t have a referral program in place.

Existing customers are far more profitable than new customers; there is no acquisition cost, they buy more often, and because they like and trust you and what you offer, they don’t see buying larger a risk.  But just as importantly, they are likely to be “raving fans”, happy to refer you to others.  The key is not to leave that to chance.

Tom Hopkins, author of “Sales Prospecting for Dummies,” says that no other lead source converts to sales at a higher rate than referrals, which close at 60 percent!

They Create Better Customers – referred customers have been proven to yield higher profits. Plus they are more likely to remain a customer or be a repeat buyer. A study conducted by Goethe University Frankfurt and the University of Pennsylvania found that referred customers provided a 25% higher profit margin, and were 18% less likely to leave.

Here are 7 reasons why referrals make sense:

•    It’s a manageable process.  Because of your relationship with the referrer, you can influence the prospect

•    The process can be automated or semi-automated, freeing you up

•    Referrals complain less, and are more enjoyable to work with.  They come with a degree of “know, like and trust” because of the referrer.

•    They are mostly not price shoppers, so there is a bigger opportunity to charge premium prices

•    They have a longer client life cycle, in that they are more likely to stay with you.

•    Like existing customers, they make more frequent purchases

•    Their acquisition cost is low

How to Establish a Referral Program

Identification - Go through your client/customer list and identify the 80/20 customers, that 20 % of customers who provide 80% of your sales, and profits.  And identify those who have been with you for some time.  They are the most likely to give you referrals.

Of course, the best time to approach a client for a referral is when you have just completed a significant service for them.  This will of course depend on the nature of the business you are in. 

Because they are repeat customers, that 20% are loyal and likely to give you a referral, or more likely, a number of referrals.

But you have to ask for the referral, otherwise you are relying on traditional, haphazard WoM.

The approach – there are two principal ways you can approach your client; a phone call, or an email.  Which you use will depend on how well you know the client, and how recent the transaction has been.   The closer, in both senses, then use a phone call.  Otherwise use an email.

Remind them of the transaction, (see Follow Up below) and their reaction at the time.

Essentially you are asking for other businesses they know of who might be able to benefit from your services.  Obviously, you would want to exclude their competition.

Again there are two different approaches you can follow:

  • Provide them with a template letter/email they can send out to the people they nominate.  Take as much work out of the process as possible by supplying the template for them to customise.  You do need to ask them to copy you in so you know who they have approached.
  • Ask them to give you the contacts for you to approach.  Keep it simple; business, contacts name, phone number, email address.  You could put this in an attached form, or put the form in the body of the email to make it easier for them to respond.  Obviously, you need to gain their approval for you to use their name in your approach.

Develop a template you can use over and over again.

You should have a second template for a follow-up reminder to encourage the client to take action.  They may have been well-meaning and intended to provide you with some names, but chaos can always intervene.

Offer a Reward – people are busy, and you like to say thank you for their willingness to assist.  It doesn’t have to have a great monetary value, but it should be useful or have some gift value.   They receive the gift when they have given them the referrals.

You should let them know their contact will also receive a similar gift if they take up your services.  This will help relieve any feeling of awkwardness your client may feel in providing their details.  It’s also a way of reinforcing the behaviour so you receive more referrals down the line from the same person.

Remember to say thank you again – when the referrals come in.  Give them a quick call, a personal touch.  It’s another chance to reconnect.

Keep records - as part of your “Referral System”; who you have contacted, when, follow up, when, results. 

There are some other things you can do that will encourage referrals, such as:

Be Memorable: Go above and beyond.  Blow customers away with a simple gesture.  A harbour cruise company I knew in Darwin would give ladies stepping ashore after a cruise a single stem orchid or rose.   You can bet they would remember that, and the cruise.  And you can also bet they would mention it to their friends.

Follow Up – An opportunity that should never be missed.  We’re all guilty of this.  Make a phone call or send a card to customers a week or two after you have delivered your service.  Thank them for their business, and let them know you hope they’re finding things now. The simple effort of reaching out will earn you big points and help gather valuable information.  This is when you could also ask for some referrals. 

This approach is also useful in asking for a testimonial, but let’s not confuse the issue at this stage; one step at a time.

Referral Mistakes

Several things can kill your Referral Program;

•    Not earning the right to ask for them – bad service kills off referrals.  The only referral you are likely to get is “Don’t go near them!”  Bad news travels fast.

•    Not asking for them – not having a program.

•    Relying on Word of Mouth – not systematizing your program.

•    Not tracking and measuring the number of referrals

•    Not thanking people for their referrals, and again when they are successful

•    Assuming all you get, is all you can get.  Do this well, and well and you’ll get more referrals down the line from the same client

•    Believing that all you need is a good product or service – it won’t happen unless you make it happen.

•    Relying on only one main source of leads for your business.  “One” is the most dangerous word in business.

If you would like to be part of my referral program?

And receive my reward, “The Profit Leak Detector – Tell Tale Signs to put Cash Back in Your Business”, contact me here and give me the business name, contact, their email and phone number, and I’ll immediately forward this valuable booklet.

© Copyright 2017 Adam Gordon, The Profits Leak Detective 

Now we all make mistakes

Sometimes they are small, sometimes they are significant, sometimes they are, in effect, terminal.

As someone once said, the person who never made a mistake, never made a decision.  Danny Iny put it well, “If we don't take risks, then we stagnate.  And stagnation is the beginning of the end.” 

In business, the usual risk we take is when we seek to grow our business, both in turnover and, more importantly, in profitability. 
That risk may be in introducing a new product, or product line, in diversifying, or in location.

In my client’s case, it was the latter - location.    She wanted to get in front of more people, a bigger market.  She operated a small, specialised retail business with a street frontage in a general shopping area – all other small and varied retailers.  People had to know she was there, foot traffic was, for want of a better word, average.

The opportunity came up to take a vacant shop in a shopping mall, right beside a major supermarket operated by one of the majors.  Sure, the rent was much higher, but the passing foot traffic was huge.  What could go wrong?

But go wrong it did.  The move was a disaster, a failure the costs of which continue to dog her to this day. 

The problem – my client was in the wrong market.  Just because there are a lot of people around. Doesn’t necessarily mean there’s a market for you.  If they are not interested or seeking the type of product or service you are offering, then the numbers mean little.

So what is a market?  Here’s a somewhat boring definition.  The term market refers to the group of consumers or organisations that is interested in the product, has the resources to purchase the product, and is permitted by law and other regulations to acquire the product. The market definition begins with the total population and progressively narrows to many different niches.

From your perspective, you need to have the right product at right place at the right time if you are to make the sale.  And there needs to be enough of such buyers for you to make sufficient sales, and earn sufficient profits, to have a sustainable business.

It is frequently said that selling is a numbers game and the more people you get in front of, the more sales you will make.  And that was my client’s plan.  The supermarket would put many more people past her door than she could ever get in her street.

But let’s think about it a bit more deeply.  While my client might have had the “right product” she certainly did not have it at the “right place” or the “right time”.  Those people going to the supermarket were certainly not “qualified prospects”.  They were there to do their grocery shopping.

You’re probably the same.  Grocery shopping is mission intensive.  You are focused on one thing, your shopping list, how to complete it as quickly as possible, and get out.  Grocery shopping is not the time for window shopping, for wandering around looking for ideas for gifts or whatever.  You don’t need ideas, you have a list.

But there may be other ways of looking at a market.  Not all markets are created equal. Some are bigger, better and more lucrative than others. Knowing how to evaluate a market is like knowing where to go fishing for a great catch.

David Cameron Gikand has developed a checklist of 11 market characteristics to help you evaluate your target market so that you can take your business where there are the highest chances of success.  A rising tide floats all boats; a great market lifts everyone up.

Take it away David!

Use these 11 characteristics to evaluate any market with ease

To evaluate your market, get a pen and piece of paper and go out and research the following 11 characteristics. Rate how well that market scores, on a scale of 1 to 10, on each of these characteristics, and then see if the total score makes you happy.

Here we go:

1. Size. The bigger the market size, the better.

2. Urgency. The more urgently people need the products in that market, the better. For example, pet rocks have no urgency, but medication does.

3. Speed to market. The faster you can go from getting the initial idea to beginning to make sales, the better.

4. High pricing potential. The higher you can charge per product, the better.

5. Low cost of acquiring new customers. The easier and cheaper it is to get new customers, the better.

6. Low cost and ease of delivering. The cheaper and easier it is to deliver your product, the better.

7. Uniqueness. The more unique your product is (or how you deliver it, or how you package it), the better.

8. Low upfront investment. The less resources you need to test the market, build the business and get started, the better.

9. Back-end and up-sell potential. The more related products you can sell to your existing clients, the better. You don’t want to go into business whereby you can only sell one product one time to each customer and then that’s it. There is now growth potential there. You need to be able to repeatedly sell the same customer.

10. Evergreen potential. The easier it is to continue selling and selling once in business, the better. For example, a product that can be sold for ever, like toilet paper or cooking oil, is better than one that is sold just once, like pet rocks.

11. Addressability. The easier it is to reach and communicate with your market, the better. For example, does your market congregate in “pools” like mailing lists or radio stations or places you can get access to?

Thanks David – that’ a useful list.

Are you in the right Market?

When clients approach me for coaching, so often, they are not getting the clients they need, the right clients.  Eight times out of ten this comes down to not knowing what is working, and what is not working, and why it is not working.

For more than 28 years I’ve been helping small business owners plug the profit leaks in their business and restoring their cash flows by assisting them understand where there profits really come from, where they’re leaving money on the table, and where their sales are costing them profits.

If you would like to discuss with me how you might do that, book a Strategy Consult here

© Copyright 2017 Adam Gordon, The Profits Leak Detective 

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