Guarantee SME Client Loyalty
Guest Contributor: Albert LukAlbert's Posts
- Albert's SiteIn my last post, I shared some sales secrets from a friend of mine on selling technical products/service to SME's. As a provider of legal services, I would classify my services as falling into this category. After all, purchasing legal services is typically not a SME staple consumable.
How, then, does any salesperson selling what is perceived to be an "extra" achieve their sales target much less ensure SME client loyalty?
I have heard many sales/account managers use the term "one-stop shopping" or "full array of solutions for your needs" or some derivative of the above to describe the company/product/service being sold.
Why aren't these salespeople using that same saying to describe themselves?
A crucial step in guaranteeing loyal SME clients is training sales/account managers to think of themselves as advisors for the business as a whole and not just a solution provider for a particular good or service. SME owners are juggling multiple roles daily from CEO to CFO to CIO to Chief Photocopy Officer; you name it, the owner-manager does it.
SME's are OVERWHELMED on a daily basis. SME's also feel like they are ALONE. The last thing that SME's want is a salesperson to increase those feelings by having salespeople who only care about pushing product on them.
Do something to take one thing off the owner-manager's daily plate or be their sounding board for their business. These steps will help win their life-long loyalty, especially if it not connected with the good or service you are selling. Suggest ways for clients to cut costs; Recommend strategies to reduce paperwork; Share some non-confidential industry intelligence with your clients.
Any measure to be their one stop business advisor shows that you care about the owner-manager as a person- and not just another account. Given that people buy on emotions, the empathy that you show will cement the relationship.
Here are two case studies from my own experiences which reinforce my point:
- I met SME Inc. two years ago. The owner of SME Inc. is successful but over-whelmed and has no one really advising her on her business- she is a one-woman gang who is constantly being sold something. What the owner-manager wants is to increase revenue to fuel expansion. I recommended she increase prices on certain goods that she was certain the market could absorb without any client loss. She followed my suggestion and the owner-manager is happy to report she has more money in the bank.
Here's the catch- SME Inc. was not my client when I gave her this suggestion-it was the first time I met her. The suggestion also had nothing to do with the law. The suggestion was driven more by the fact I wanted to help her as an owner-manager because she was (as simple as it sounds) a great person who needed some suggestions and not someone selling him something. Even though the owner of SME Inc. has said to me that she could retain much larger competitors than me, she retained me several weeks later and has been a very loyal client who I am privileged to help.
- I once met a SME mirco-lender who really cared about their borrowers beyond the monthly interest payments they received. The lender would visit the borrower before any money was lent and find ways to improve their business- even if that business never became a borrower. They would recommend book-keeping software, suggest ways for their employees to be more productive and advise owner-managers on how to grow their business. Here's the catch- the lender is a one-off lender. In other words, almost all of their borrowers would not use them again because of the nature of the financing. However, they still cared enough to advise their borrowers on how to grow their business knowing that they would not be able to sell any further goods or services to their clients. When was the last time a bank did that? Where does the lender get most of its clients? Good word of mouth based on services which was indirectly related to the good they provided.
If there is one suggestion to take from this post, it would be to understand how a SME business operates on a daily basis and use that understanding to help your clients/potential clients in matters unrelated to what you are selling. It will go a long way to guaranteeing customer loyalty.
Labels: advisors, Albert Luk, client loyalty, increase prices, legal services, one-stop shopping, owner-manager, sales target
Sell SMBs By Sharing HR Best Practices
If you have been a regular reader of this blog you will have seen a number of posts on how I believe big companies should share their best practices with their small business customers. The logic is simple: small companies look to big companies for standards, systems, and procedures. If you are a big company, chances are this stuff is second nature to you. By sharing the information with your small business clients you earn their trust and win their business. Develop the relationship first and you will not have to ask for the sale - it will come to you.
One of the biggest problem areas for small business owners is hanging on to their top performers. Entrepreneurs spend an incredible amount of time training and supporting their employees only to have them leave a short while later to pursue other opportunities. According to a survey by Robert Half International, the main reasons why top performers leave small businesses are:
- Limited advancement opportunity: 39 percent.
- Unhappy with management: 23 percent.
- Lack of recognition: 17 percent.
- Inadequate salary/benefits: 11 percent.
- Bored: 6 percent.
- Lifestyle change, such as moving: 2 percent.
- Other/don’t know: 2 percent.
Sharing your HR best practices and giving your small business customers a framework to work within so they can hold on to their top performers can be invaluable information for them. How does your company reward the top salespeople? How do you motivate, inspire, and manage your people? What initiatives has your company put into place to recognize workers and make the workplace a fun and inspiring place to be? How do the top managers in your company keep employees loyal and hard working?
By offering yourself as a resource to your small business clients you become an invaluable trusted adviser instead of a commodity service or product vendor. Understand the challenges your SMB clients are facing and look within to leverage the best practices your company is using to solve those challenges. When you win the hearts of the entrepreneurs you will win their business.
Labels: customer relationships, recognize workers, share best practices, standards, systems and procedures, top performers, Trust, trusted advisor, win their business
3 Ideas To Help You Sell To Small Business
In addition to the tips and strategies I have shared this week on how to sell to small business, I wanted to give three more ideas that can push your SMB efforts over the hump:1) Small businesses love FREE!
Entrepreneurs love free things and rewards. Even if it is something as inexpensive as a pen, small business owners will appreciate it and tell their friends about it. Many small business owners have limited sales and marketing budgets and their dollars are typically spent more on the sales side. They invest in the materials they need to close the sale such as fliers, business cards, websites, and salespeople. Typically they do not purchase marketing like branded products until the sales side has been taken care of so they appreciate your efforts. You may be used to having everything branded with your company name all over it from mugs to hats to duffel bags but a little thought goes a long way to recognizing your SMB clients. It makes for a happier customer and more referrals.2) Focus on the information not the sales pitch
Small business owners can see right through your sales pitch. They do not want to see sales materials thrown at them and a salesperson banging down their door. They will often assume that they cannot afford your offerings if you look too slick. They like to be educated and feel that they are in control of the purchasing process. Give them the information they need such as case studies, white papers, third party awards, and testimonials. Keep the message simple to understand and focused on the benefits they can realize - then go for the sale.3) Give pricing options
Pricing will be an issue with every small business client you encounter. It will not always be the most important factor, but it will always be high up on the priority list. Offer ways to slice and dice your pricing to show them that you are trying to work with them. Some options are to break down your product to give them exactly what they need, give a trial period at a lower price, have a discounted rate if they sign up their friends, and offer financing options. This last point is of particular importance as small business owners are often cash strapped as they put their dollars back into their business and wait for accounts receivable to come in on products they have already invested in and delivered. Offering financing options will always be a point of differentiation when selling to small business owners.
Labels: busines cards, close the sale, fliers, free, rewards, sales and marketing budgets, sales pitch, salespeople, SMB efforts, websites
Small Business Word Of Mouth
Much of the purchasing power for both the United States and Canada is held in the hands of small business owners. They hold the purse strings, can make or break your company, and their difficulty to reach make blogs such as this one popular.
Word of mouth advice is how entrepreneurs end up making purchasing decisions. Sure they may have seen your advertisement on TV or in print, they have probably already checked out your website to learn more about your product, but at the end of the day, a good or bad recommendation from another entrepreneur is likely going to be what makes or breaks their decision to move forward.
How can you get the small business community to spread the word about your product or service?1) Identify and support your champions
With any product there will be champions - the hardcore users who love using it and tell their friends about it. They are seen as experts by their peers and are often called for advice on which company to choose. The good news is with today's technology it is easier than ever to find and support your champions. Who is blogging about your company / industry? Whatever size your industry is, there is somebody who is blogging about it. Support these people with new product information, special events, rewards, recognition, and a personal connection into your company. Make them feel important and give them the information they need to show off your products - and they will!2) Follow up with existing customers
With their smaller budgets, SMBs will not have the same number of transactions with you as their larger counterparts. Depending on the product you are selling it could be years between purchases. Do not forget to follow up with your existing customers regularly. Make sure they are enjoying your product and let them know of any new specials you are offering. If they are not ready to buy again yet, they will have the knowledge when their peers ask them about which provider to use. If your product has broken down on them and they have not heard from you in years, you are not likely to get a warm recommendation.3) Ensure proper damage control
While positive word of mouth will spread as you establish as solid reputation in the SMB community, negative word of mouth will travel even faster. Almost even conversation I have with small business owners at one point ends up on a negative tone as they attack a company who they feel has done them wrong. Whether it be their phone provider, bank, or accountant small business owners tell their friends about their bad suppliers. If you have a negative experience with a customer or even have to let them go, make sure to leave them with the most favorable impression possible of your company. If it requires making an apology, giving a discount / credit, offering a refund, shipping a new product, or any number of concessions, the cost will be more than worth the negative word of mouth your company will receive otherwise.
Labels: advertising, damage control, difficulty to reach, purchasing decision, recommendation, small business community, SMB community, support champions, website conversion, word of mouth
The Big Business - Small Business Disconnect
There is often a large disconnect between big business and small business. SMB owners do not think they are important enough to the big businesses so they go with someone who they feel they can have a personal relationship with and who will be attentive to their needs. The thinking is "Why would a Fortune 500 company care about me when they have all these huge companies as customers? I am going with someone who will treat me like I am important to them."
How can you show SMBs that you care about them and remove the disconnect?1) Actually Care
This might sound obvious but there is often a disconnect within an organization about how small business sales and service should be handled. While the CEO or VP Sales might be on board with creating the vision it is up to the front line workers to execute that vision. Make sure your people are taking the time and effort to actually care about their small business customers and offer the outstanding service that you are preaching.2) Hire People Who Understand Small Business
Small business owners like to deal with other small business owners. Many sales are lost because the entrepreneurs do not feel like the salespeople understand their situation. The salespeople are thinking too much like a "big business". You need people who speak the same language and understand the SMB mindset. Hire people who have either run their own businesses in the past or have been exposed to SMBs prior to joining your company or they will have a steep learning curve and you will lose many potential opportunities. You cannot fake it.3) Show That You Are A Small Business
Just because you are working at Microsoft or Xerox it does not mean that you are not entrepreneurial. Chances are you have a small team that you are working with, have a budget to operate within, and are trying to make the most with the resources that are available to you. Show your SMB clients that you are running a lean machine, just like they are, and that their business is
important to you.
Labels: actually care, disconnect, Microsoft, outstanding service, personal relationship, SMB mindset, SMB owners, Xerox
Fire Your Bad SMB Customers
Small business owners understand the value of their money when they decide to make a new purchase. They have worked hard to generate that additional income and have gone through many personal sacrifices to get their companies off the ground. Because they had to be so penny-pinching to launch their businesses, entrepreneurs will typically drive a hard bargain on your pricing and make sure they are getting value for money.
Small business owners can also be very quick to react and easy to offend if you drop the ball with any part of what you said you were going to give them - pricing, delivery, service, repair, etc. They will watch you like a hawk until they get what they want, especially if it is a big expense for them. Note: keep in mind that a big expense for a small business owner is likely not a big sale for you.
Having said this, however, some SMB clients are just not worth keeping. Like any other segment you will have a percentage of your clients who you just cannot make happy. They will drain your resources, call you every time there is a slight problem, make unreasonable demands, and cry foul until they have been appeased.
Just because you have made a commitment to sell to small businesses it does not mean that you have to sell to every small business. While the majority of SMBs may be great clients for you, not every SMB will be worth the hassle. Do not be afraid to fire your bad customers if they are taking you away from servicing your good clients.
Labels: additional income, attract small business owners, big expense, delivery, fire bad customers, penny-pinching, pricing, service, value for money, value of money
UPS Announces $25,000 SMB Contest
Nothing attracts small business owners like a chance to win money and gain recognition from the corporate establishment.
That is why UPS has announced it's third annual Best "Out-of-the-Box" Small Business Contest - and this year the company is going international.
UPS is looking for the "the most innovative small businesses" with 2006 revenues between $250,000 and $10 million. The top prize is $25,000 in cash, an IBM small business package and promotion in UPS's international publicity campaign.
Along with the financial reward comes the all important instant credibility that the winning company can use to land new customers and gain additional media exposure.
Contestants need to fill out a form and submit a 500 word essay at the contest website
. It is a fairly cheap price tag for UPS to pay considering the exposure they will be getting as a result.
Kudos to UPS - what is your company doing to attract SMB attention?
Labels: attract small business owners, corporate establishment, generating revenues, IBM small business package, Out of the Box, small business contest, UPS
AT&T Launches Small Business Website
It is time to add AT&T to the list of Fortune companies creating a website to target small business owners. On Monday the company launched http://www.att.com/OnwardSmallBiz
as a resource for entrepreneurs and to promote AT&T solutions.
Some of the content includes:
- A daily feed of small business news, including streaming video segments from SBTV.com - Small Business Television.
- Free instructional Web-based seminars and training courses hosted by experts.
- Tips on starting, managing and relocating a small business from a variety of experts and sources.
- Helpful information developed specifically for women and minority business owners.
- Money-saving promotional offers from leading brands serving small business needs, including UPS, Pitney Bowes, Lenovo and CareerBuilder.com.
- The ability to submit questions and to receive one-on-one advice from SCORE - Counselors to America's Small Business.
- Information on AT&T products and services, money-saving bundles and special offers for small business are also available on the portal. For example, Current features include the new AT&T Unity(SM) calling plans for small business that allow unlimited wireline and wireless calling to AT&T and Cingular, now AT&T, customers across the nation.
- Easy access to AT&T's online support, e-bill and account management services, including the AT&T Account Manager and AT&T BusinessDirect(R) portals, which allow customers to manage their accounts, view and pay bills online, and even order additional services online.
The site itself looks unfinished. The main graphic is very confusing with a lot of text coming across the picture. The rest of the page layout has minimal content and useless polls like "How internet savvy are you?" While I cannot see too many entrepreneurs taking immediate advantage of this new site it is a step in the right direction for AT&T and if they keep at it they might have something on their hands.
Labels: account managers, ATT, CareerBuilder.com, Lenovo, Pitney Bowes, promotional ofers, SCORE, small business owners, small business television, UPS
Are You Relationship Lending?
Entrepreneurs are often cash strapped as they grow their companies. Even the fastest growing companies often operate at a loss because they to fund their tremendous growth and sacrifice immediate profitability for market share.
If you are selling a product or service with any significant price tag the issue of financing will come up. The more flexible you can be in offering financing the more likely you will land the business. Many SMBs do not fit the standard funding criteria that most companies and banks look for. Many do not have a multi-year track record of sustained profitability because they are investing the money back into their company to fuel growth. The owners often do not have significant personal equity built up either because they have pumped their assets into their businesses.
This is where relationship lending comes in. While the SMB clients may not fit the ideal company to lend money to, they can still be highly profitable. Relationship lending involves working with the business customers who do not meet the typical profile. It requires moving beyond the statistical models and creating a vendor-client relationship. It means getting more detailed information about your clients and monitoring them as they continue on their path. It is a lot more work to manage and usually results in higher fees and interest rates.
But it can pay off. According to a new report by Dr. Joe Peek with funding from the Office of Advocacy, relationship lending has proven to be a profitable niche for many small banks who use it as a competitive advantage over their larger counterparts.
"small business lending is a profitable market niche for small publicly traded banking organizations... The evidence is consistent with these banks having a comparative advantage in originating and monitoring small business loans compared to larger banking organizations."
It was also found that the banks who engaged in relationship lending had an increased market valuation over those who did not.
SMBs are looking for organizations who understand their needs and are willing to work with them. If your company has not already looked at financing and relationship selling, the time could be ripe for you to make a strong footprint in the SMB community.
Labels: cash strapped, Dr. Joe Peek, highly profitable, market share, Office of Advocacy, relationship lending, statistical models, vendor-client relationship
Entrepreneurs Want Work-Life Balance - Who Doesn't?
MasterCard recently put its most recent survey results that showed 96% of small business owners find it important to manage their work-life balance. More than half of the respondents said that owning your own business makes it easier to balance than other workers. 83% said that they rarely or never miss important personal events because of work.
Some of the other findings on achieving work-life balance were:
When asked what they would do if they received a $100,000 injection to their business to use towards improving their work-life balance, the entrepreneurs responded:
- Not having enough money to meet business and personal needs (21 percent) and rarely being able to fully turn off from the job when they're away from it (16 percent) where the top factors noted as interfering with work-life balance
- Making enough money to meet or exceed business and personal needs (30 percent) and having flexible working hours (28 percent), were the top factors noted that help small business owners achieve work-life balance
- When asked what work-related factors best help them to achieve work-life balance, better organizing business and personal priorities (29 percent); and hiring and retaining competent employees that could assume some responsibilities (21 percent) were among the top factors cited.
- Sixty-one percent of small business owners said that they work between 8-12 hours a day
- Invest or save it (49 percent)
- Paying off personal loans and other debts (29 percent)
- Upgrades or improvements/expansions for your business (26 percent)
- Paying off business loans and other debts (27 percent)
- Purchase business equipment and/or supplies (25 percent)
- Donate it/give to charity (25 percent)
- Employees (i.e. increased salaries, improved benefits, bonuses, or time off) (20 percent)
Labels: hiring employees, MasterCard worldwide, organizing priorities, pay off business loans, purchase business equipment, small business survey, work-life balance
Cisco Bolsters SMB Efforts
Cisco Systems has announced a new channel partner program to promote its Linksys division products to small businesses. Most of the technical equipment buying decisions for the SMB market are made through outside consultants which forces the Ciscos of the world to sell through a network of partners. The company that does the best job convincing parters to push their products wins.
To encourage its partners, Linksys will be offering a new program that offers lead-generation support and market development funds. Cisco will also be trying to convince their resellers to take its higher priced competitors like HP, 3Com, Netgear and D-Link off their roster and focus solely on Linksys. How the company plans on executing this strategy is still unclear.
A challenge facing Cisco is that Linksys is seen more as a consumer or SOHO play. Despite having a full roster of products, Linksys solutions are not usually considered as options for SMBs. It will be an uphill battle to get SMBs to look at Linksys as a viable alternative to the more entrenched players. By the same token, the Cisco brand is seen as being for big business only. Can Cisco narrow the gap and get some SMB market penetration?
The answer will lie in an effective partnership strategy. Their new channel program is scheduled to be announced on June 5th at their Connected Office Day event. Time will tell if they new incentives are good enough to propel them forward.
Labels: 3Com, Cisco, D-Link, equipment buying, HP, lead generation, Linksys, market development, Netgear, network of partners, outside consultants