Persistence Pays Off
Many years ago I worked for a boss that would occasionally ask me questions that he already knew the answers to. Why? He wanted to know if I knew the answer. A couple of years ago I started asking contractors in my seminars a question. Like my old boss, I thought I knew the answer to the question before I asked it. I was wrong! The simple question involved how many times the contractor called back after having provided the customer with a written quote for replacing their equipment.
The first year or two I would ask, "How many in the class contact the customer five or more times after providing the quote?” Very few hands went up. “How about four times?” Another hand or two went up. Today I frame the question a bit differently. I now ask, "How many of you make one or more follow up contacts with the customer after having provided them with a written quote?" To my continued surprise, less than 25% of the class calls back…even once! Wow, that's scary.
I recently read that 80% of all sales people NEVER call back after having provided the customer with a written quote. That, at least to me, is an amazing statistic. Please write this down, put a sticky note on your sales pad and/or stencil this on the back of your wrist: Persistence = Sales
Persistence is the key to sales. Want to hear another statistic from the same source? Seventy percent, yes 70%, of all sales are made after the fifth contact with the customer. Now to be honest, the statistics I am quoting apply to all sales people, in all professions. Our profession is a bit different. The average sales person closes 25–30% of their sales at the conclusion of the initial presentation, so in that area we are a bit better that “all sales people.” However, based on my class question, and 26 years of working with contractors, we are not all that different than others when it comes to follow up.
Investing in Your Leads
You have all likely attended marketing classes, therefore you know the cost of creating a lead and it is very expensive. Some contractors only investment in marketing is the Yellow Pages. If that is you, sign up for a marketing class ASAP. On the other end of the spectrum, I recently completed a company overview with a contractor that had "budgeted" a bit more than $950,000 over the coming 12 months for marketing. Yes, he does about $11,000,000 in gross sales so that means 8.6% of his gross income is budgeted for marketing. Notice I said he "budgeted" those dollars. Translated, that means he had solid plans concerning how he was going to market his company over the coming months and those dollars were part of his budget, and therefore part of his hourly rate. Remember, the customer pays for everything, it's all included in (or should be) the hourly rate you end up charging the customer.
Yes, I am a bit off topic here but the point is easily made. A well-run company spends a lot of money generating a lead. You have made the investment, and have the lead, and the presentation has been made. Doesn't it make sense to follow up with the customer? Replacing a customer’s equipment can run from a few thousand dollars to over $10,000. Just closing one or two more leads per month can make a huge difference in the company’s overall gross sales. Do the math for your company. The numbers may surprise you.
The Importance of Following Up
Twenty-six plus years ago, before I founded Grandy & Associates, I was the general manager of a service company. I cannot tell you how many sales people dropped by spending anywhere from 15 minutes to an hour or more in my office telling me about the product and/or service they offered. The irony is this: I actually would have purchased many of the products and services they offered, but they never called me back! Did you hear what I said? I would have purchased their product or service but they never called back!
Your potential customer is about to spend thousands of dollars to replace their system. Sure, 25% will decide on the spot but what about the other 75%? They need time to think about it, discuss it with their spouse, or perhaps look around a bit more before they make their final decision. What if the customer was you? You just had presentations from three contractors. Two contractors never called back while the third called back routinely (in a gentle non-pressuring way). What are each telling you, without saying it?
As a consumer, the two that don't call back are either telling me they are not really interested in replacing my equipment and/or they are saying they are too busy to do my work. Besides that, I am thinking to myself, "If they won't take the time to call back, what's the probability they will show up if they did get the job?" Bottom line: they don't care about having my business. The third contractor must want my business because he or she continues to follow up. Assuming the customer really wants the work done, which contractor do you think the customer will choose? Which would you choose?
We have an unwritten rule in our company when it comes to following up on leads. We call back, call back, and then call back again. Eventually one of two things will happen. The contractor and/or organization will either schedule a seminar and/or consulting work, or they will tell us they are not interested. Either answer is fine. The amazing thing, in our case, is that 90% of our work is actually scheduled when we call back. Less than 10% actually call back to say they want to schedule a program. By the way it is typically 6 months to two years before the decision to use us is made. Get the point?
Keep one simple fact in mind. Our company, nor yours, is usually the number one priority in the customer’s life. If the customer is not called back (your initiative) they will soon forget about you. The key to sales is persistence.
However, there is a key to persistence as well. The key is to have a simple system in place to follow up on your sales presentations.
Tom Grandy is the founder and president of Grandy & Associates. Tom is an industrial engineer by training, has worked as the general manager of a service company and was previously the Director of Company Development for Dial One franchise.
This blog is reprinted with permission.
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