Monday, November 07, 2005

Seek Profit Not Revenue

Another great article from the CEO Refresher from Michael W. McLaughlin. When to Walk Away From a Sale: Nine Pivotal Questions goes beyong B.A.N.T. (budget, authority, need, timeline). This is the advanced course on qualifying your sales leads. Strap in because these are the hard questions. The ones that will make you break out in a sweat. The ones you aren't asking today. The one's that if you did ask you would be spending MUCH less time writing proposals for prospects that go nowhere.

1. Don't Use the Proposal Process to Define the Project. If the prospect can't articulate the goals, feel free to put on your consultant hat and help them frame the business problem. Don't start drafting proposals that they can hand off to someone else to implement.

2. Is This Bob's Super Secret Project? Does Bob have approval AND funding from higher up the mountain? Even if Bob is CEO, does the Board say he is good to go. If not, this isn't a real project. You can help Bob get approval for his project and make sure you are there when he pitches to his boss. Don't invest too much though....because the project still isn't real.

3. What is the decision making process? How will a winner be picked? Every prospect will tell you they have a process. Dart throwing is not a process. You say they don't have a process? Here's an opportunity for you to become a trusted business advisor and help them create one. Beware the apples to apples comparison. Fruits are not created equal for a reason. Your niche approach SHOULD NOT stack up against the competition. I mean that in a positive way. do have a niche, right? If your offering is a commodity why are you reading this?

4. Who signs the checks? Figure out who this person is and engage with them immediately. Yes, you may have to ask your contact who the real decision maker is for the project. Proceed without knowing at your own risk. Use diplomacy. Position yourself as helping the prospect. While you are at it, find all the people influencing the decision. Talk to them. Get them to buy in.

5. Who is doing the work now? Is there an incumbent? Is the prospect out shopping for competitive bids to drive the incumbent's price down? You may want to know that before you start drafting proposals and generally wasting time chasing something no one is ever going to get. Yes. Prospects will deceive you.

6. Can your company deliver? You may not really WANT this project. As the author says,

Not all revenue is good revenue...

7. What are the opportunity costs? This goes with number 6. Are the projects in your pipeline more valuable than the new project? I understand that many of us don't have this luxury.

8. Why did the client call you? McLaughlin has this as number 8. I think it should be number 1. See number 5. Are you there because the prospect's boss wants 3 vendors to compare? Or are you there because your marketing is working and your message resonated? What does the prospect know about you? What they DON'T say is as important as what they do say. Listen between the lines.

9. Do you buy it? Trust your instincts. Weigh all the factors you are gathering. Is the project "real"? What are the politics on the prospect side? What probability of successful closure do you think exists? Weigh the risk-rewards.

This is a great set of questions to get you beyond B.A.N.T. This will let you dive deeper into your clients and help you through the discover and qualification process and get you to a winning proposal. McLaughlin wrote a book with Jay Levinson (Guerilla Marketing) focused on consultants but this list applies to anyone marketing or selling any kind of product or service.

Technorati Tags: , , , ,

No comments: