Go Forward with Geoff Fitchett
Expert Training and Consultancy services from a sales genius

Prospects are valuable. Ask any clued-up Sales Director and she’ll tell you it costs, £30 to get someone to call on the telephone, £70 to physically cross the threshold or £2.50 to look at your website.

Those figures are just examples by the way, so while they may be largely representative of some businesses, they are different for every business and vary for a hundred reasons.

Once converted from a browser to an ‘adopter’ (marketing speak for someone who buys something), that spend is returned from the margin of the sale along with a nice little profit.

Sounds like a good idea then, find a prospect and convert them first into a browser and then through merchandising and the proper application of a sales process, convert them into an adopter and in so doing make a load of profit. Put that way it demonstrates the principle that all prospects possess an inherent value simply because they cost something but can pay it all back with bells on. Now then, where do we find all these yummy (and valuable) prospects?

It’s not unusual for businesses to buy-in lists of prospective customers. Doing so can be expensive but – like all marketing when viewed coldly – is simply an investment. The idea is that a prospect costs say, £1, that one thousand prospects cost £1,000, that they close at 0.5% generating five sales and that those five sales net considerably more than the £1,000 spent on the prospects. That being the case, why wouldn’t everyone be doing it?

Firstly because the results can be so wide-ranging; on one occasion the enquiries and sales pour in, the next; nothing! There are so many variables even the experts find it difficult to predict the likely results. Lord Leverhulme, chairman of Unilever said, “Half the money I spend on marketing is wasted.  I just don’t know which half.” I have heard this mantra from clever marketing folks many times since.

If predicting the performance of ‘cold’ leads is difficult, it is much less so for the customers with whom a business has already engaged. They know the business and have already taken that first big step of doing business with it. The biggest challenge is converting a cold lead – one unknown to the business – into a customer (adopter). Once that major step has been accomplished, the science of turning a one-time customer into a regular shopper (the next step in the process) is, if not easy per se, at least easier.

Marketing departments have both options; contacting cold leads, however acquired in the first place, and contacting customers already on the in-house database. They are both ‘numbers games’, but for the latter, the numbers tend to be rather better for obvious reasons.

At least, they can be if they are treated properly, otherwise the benefit is only temporary.

So attractive is the company’s database that some marketing functions find it irresistible, treating it the way some people treat a tube of Pringles or peanut M&Ms; returning to the source repeatedly and greedily until it’s given all it’s got, then pouting as if they’ve been short-changed. Family size indeed! Call that a serving? Pass me another crate…

The customers are on the database because they once bought something, small or large, recently or absolutely eons ago. Unaware they are about to be contacted by the business they have varying levels of interest in the products and services of the company, ranging from entirely uninterested to utterly fascinated and with the vast majority sitting somewhere in between. Overlaid on this matrix is another, on which people range from having a very low tolerance to contact, to a very high one. Naturally, some of the people uninterested are also the ones who have a low level for being contacted (I don’t want anything and leave me alone), and the opposite is also true, but not always. There are customers with high levels of interest who do not wish to be contacted and those with none who are happy to browse endless mailshots and newsletters and respond to customer service surveys without griping. Even with just these two pairs of polarities, it’s a complex situation ensuring that some people to whom you send a solitary piece of mail will shred it in a fury of indignation, while others will happily browse your near-daily marketing materials ad nauseam.

So, how to know what to send to whom?

This is where your marketing gets clever, or at least it is where it should get clever. Market intelligence (a.k.a. knowing your customers) means you know what to send to whom, when to send it and how to word it and what form it should take. Charlotte likes SMS, but is okay with email too as long as it’s interesting. Dave reads the newsletter (Dennis doesn’t) but only if it’s printed as he deletes most of his email, Debbie prefers a call on the phone (leave a message, she never picks up), while Don, Daisy and Danielle all prefer a straight email, although in Daisy’s case, keep it brief and infrequent and Don has rubbish internet so can never see the pictures he gets sent.

Get all this right and things work beautifully.

“Too difficult!” cry most businesses, “We simply don’t know our customers that well!” (problem #1) and it’s too labour-intensive (problem #2).

Telephone calls are highly effective for all sorts of obvious reasons but are labour intensive and require a skill-set frequently absent (or at least weak) from both marketing and sales functions (problem #3). SMS messages currently have a much higher level of being read by the recipient and in causing a response and yet some businesses don’t have a ready way of sending SMS messages. Recent customer research suggests a trending preference for printed newsletters rather than electronic ones and at the root of the psychology is a simple principle; people like to feel that the contact is for them personally, not that they have been lazily included on the fringes of a mass mail-out.

But none of this matters to some businesses. What’s cheap? What’s easy? What hits a mass audience with one click?
The answer is to blanket the database with generalised and very regular contacts, gradually alienating Danielle, Daisy (she went first), Don, Debbie, Dennis and Dave to the point where your correspondence has been redirected to ‘junk’ via their filters, they no longer pick up the phone, they bin your post unopened and in some cases have asked to be taken off the database. Only Charlotte remains, because, as you may have noticed, she’s the odd one out. In desperation and blind ignorance, the marketing department refuses to learn the lesson and goes out and buys a new list of prospects. This is not a bad idea as such, but given the way the prospects are bombarded with contacts, it won’t last long, it will be plundered and burned until a new one is needed.

At the board meeting, the marketing director is asked why marketing costs are high while traffic remains low but she will redirect the thorny problem to the sales director who surely ought to be closing at a higher percentage and cite a single example of someone not being properly dealt with as proof of an epidemic of poor sales techniques. The sales director will question the quality of the leads and the chairman will jump in before eyes get scratched out.

The hidden cost of marketing is not the £s it takes to perform the activity, but when the marketing is so general, the cost to the business is the inevitable alienation of another handful of otherwise valuable prospects. This shortcoming is SO much worse when those people historical buyers because it took a lot to convert them the first time and now they are gone, lost, wasted through indifference. They have been made into ex-customers.

Pity the poor customer-contact function of the business, trying to do the near impossible in order to get all this right. And how typical of a management consultant to list the many problems but be light on solutions. So, what’s the answer?
More customer information recorded and accessible to both sales and marketing functions. Efficient sales operations that convert leads and don’t ‘burn’ them the first time they encounter the prospect (plenty of those abusive fools around) and very cautious, bespoke and intelligent contact schedules which relate to the customer’s own preferences and best of all, fit within an agreed plan in which the customer has played a part.

We are heading towards the third decade of the 21st century and some things have changed; the internet has become the biggest method of researching products, services and vendors, websites are uber-crucial and speed of everything, response, delivery and repair, are key performance indicators of a business, but some things haven’t changed at all. We are still susceptible to human contact, we like to find somewhere which mirrors are values and we like to feel important, valued and special.
When it comes to interrogating the database to find more business, all the evidence is there, sales directors know it, salespeople know it, the marketing department knows it and ask the customers themselves and they’ll tell you very clearly;

Treat me like I’m the only one.

Less is more.

Question:

Hi Geoff, don’t know whether you remember me? I used to work for a well-known Korean franchise dealer in the South East and we had training in some really nice hotel in the Cotswolds. That got me started in my career which has been good so far. I now manage a small, exotic used car operation and I have two needs. One is to do with my one and only salesman and the other is about sales. I’m getting a lot of people who say they’ll travel hundreds of miles to save a few quid, using the internet to shop for a similar car to mine and then vanishing. I find I’m giving all the expertise and advice and then never seeing them again. Your thoughts? Cheers, hope you’re well, it would be great to catch up on the number below, or the email.

Neil Bakewell

Answer:

Hi Neil, That would have been the Manor Hotel, Moreton-In-Marsh, lovely place. Every used car is unique so my first question is what are they buying instead of yours; older, higher mileage, newer, cleaner? Whatever it is, it’s not exactly the same. If yours is more expensive it needs to be better in some way, or your service must make up for any price difference. If neither is true, or those factors are not ‘sold’ the customer will be right to go elsewhere. Be sure you are making the most of your reconditioning and your aftersales promise. Do a tour of your premises and introduce the customer to your technician (assuming you have one), your admin person or anyone else you have in your team. Explain what you’ve done in reconditioning and preparing the car and share your knowledge about what to look out for on the particular model of interest; these last points will be like mini cautionary tales and will build trust in you and your car. When it comes to preparation standards, aim high – be the best. Keep an eye on the competition by Googling for similar cars to yours and seeing what’s out there. Collect some details about the other cars so you understand the choices the customer has available and without running them down, be sure to present yours favourably against the main alternatives. Of course, you must also be competitive. I’m assuming you and your cars are fair value, but if not get competitive. If your cars do plenty of test-drives but stay in your showroom, you’ll know something is amiss. Finally, be confident, cool and look after your customer’s needs. Do all this and you’ll get the rewards you deserve. I’ll email you directly about your salesperson so we can be discrete.

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Question:

Hi Geoff. I know that the key to closing a sale is to raise the customers desire for the product, and this in turn will then lower the logic/cost of the product, but could you help me with some key points on how to raise the customer’s desire please?

Beth

Answer:

Gosh that’s a big question Beth, you are talking about the whole idea of what a salesperson does, so if you think you are having trouble raising desire let’s go back to basics: The customer will pay for something if he/she wants it. The more they want it, the more they’ll pay (although you have to be aware of the competition in this). So, what makes someone want something? It’s all to do with them predicting for themselves how it will make them feel. If they imagine they will feel fantastic, they’ll want it more, but if they only imagine it will be sort-of-alright, then they won’t be in quite such a hurry. This is where you come in. If you can really gain an understanding of their lifestyle and usage, their specific needs, wants, desires and so on, you can paint the pictures of their future which include all of the ‘feel-good’ benefits of ownership. The better you are at painting pictures they recognise as relevant (accurate portrayals of their use), the more likely they are to put themselves in those pictures, experience something like excitement or deep satisfaction and consequently want to make the purchase. Assuming they want to make the purchase, it now has to become urgent or it will just be a ‘one day’ thing. THESE ARE THE MOTIVES THEY WISH TO MOVE AWAY FROM: 1. Life’s too short to wait, they need it NOW 2. The current one they own (if they do), will go wrong/let them down badly/continue to be inadequate/fcontinue to fall in value 3. The one they want will be sold/go up in price 4. They will miss out/be left behind/appear foolish. THESE ARE THE MOTIVES THEY WISH TO MOVE TOWARDS: 1. They will be envied by others 2. They will be making a statement of their success, good sense and happiness 3. Life will be better with the new one 4. Troubles and worries will be behind them. I hope that helps!


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Question:

Hi Geoff i did all my training with you back in the day for Haven when all new sales people were sent away for a few weeks to Hemel hempstead. I am running a park now which has never really been sales focussed before and trying to bring it up to speed using my experience from my last 11 yrs with the Talacre beach group. i am finding it difficult to get customers (walk-ins) to park tour as there is a lot of competition around me and all they want is a price list and then they are bolting out the door….Also the owners seem to be a bit wary as they haver only ever upgraded when they decide!!!

Shaun Roberts

Answer:

Hello Shaun, I remember you very well and am glad to hear from you. You won’t make much progress handing out price lists and without taking people on tour it’s hard to get people interested in the merits of the park so your dilemma is very real. You’ll need to stop people in their tracks when they come in. I think you need to face the situation head on and say something along the lines of, “Most people who are looking for a holiday home around here just shop from park to park comparing prices. Then after they buy something they begin to find out that perhaps the park isn’t right for them after all. We get people coming in quite often asking what it costs to move onto (this park). Before you fall into that trap, decide what you really want from a park and figure out your budget and shop properly. I’m quite happy to help you know which park offers what around here… I know we can’t satisfy everybody and each person has their own particular needs. Tell me what they are and I’ll point you in the right direction.” Then I think you should have some POS which identifies the key benefits of your park and what you offer. That would be facilities, tenure, pricing, site-fees, customer service, family-owned or whatever sets you apart even just a little bit. Next you must learn all of the key advantages and drawbacks of the competition. i.e.: More facilities but higher site-fees. Great pitches, but no pool. Cheap site fees but very old caravans looking like an eye-sore. This will help you narrow down people’s choices for them. You must be prepared to send some away to look elsewhere but also those that stay will have recognised you are genuine. They’ll know that no park is perfect, all are a compromise of one kind or other and it’s a matter of what your compromises are and whether they match their shopping list. All of this is like a pre-tour mini-presentation. It’s also an intent statement of sorts. If you find you struggle when compared to the competition that may tell you something and you might need more help. Let me know. Keep in touch! Geoff


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Question:

Hi Geoff, don’t know whether you remember me. My name’s Don Goodall and I met you on a 2 day General Management course all about how to run a dealership. If it helps you remember, on day 2 the fire alarm went off twice and we ended up sitting in the beer garden discussing workshop loading. Anyway, it’s still the best course I’ve ever been on and the only one in 18 years I’d like to do again! Purpose of my contact. I can’t find my course notes and can’t remember the KPI for helmets. What do you reckon? Regards, Don

Don Goodall

Answer:

Hi Don, you were sat next to a bloke called Phil who’s father had left him the shop but wouldn’t stop interfering and kept us laughing solidly for the entire course. You were the only person with an electronic diary system for the workshop too if I remember rightly. So, helmets: The difficulty is, normal margins (say 30% and up) and normal stock turn (6x) simply don’t seem to work for helmets. It’s just about achievable at the low-price end but you end up turnnng your money over nicely and selling in volume but making an insignificant amount of profit. Helmets are jewellery in a motorcycle dealership. It’s normal to display them at the back and to make sure they are well lit and mighty colourful! 3 brands is plenty unless you can manage with just 2. Have strong reasons to stock more than that, especially if with the main brands you’ve got 3 or 4 ranges between them. Follow the pyramid stocking system (contact me again if you’re unclear on that) and monitor sales carefully to avoid lost sales. Price for profit but give people reasons not to just try them on in your store and then shop on-line. Better still, get staff selling up and bundling so the shopping evolves and their basket changes so much they become less attached to whatever they’ve already seen on-line. Also, a bit of urgency can help. If there are any problems with their current helmet and they might not keep it as a spare, offer to keep it at the store and get it destroyed, otherwise some teenager might end up using it in 5 years time and it won’t perform properly. All in all, if you can vary margins (not mark-ups) from 25% to 50% and turn stock from 1x on the slowest to 6x on the fastest and end up somewhere near 2.5x – 3.5x with an ROI of about 100% then you are in the right ballpark. It’s not great, but it’s right where most people are. Finally problems occur from: i) Pilferage, ii) Damage during display iii) Over stocking the wrong stuff iv) thinking that selling lots of £60 helmets with a 30% margin will make you rich – it doesn’t. Hope that helps and nice to hear from you. Geoff

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