Black Sales Journal

I worked for years to get a coveted prospect to buy from our company, and was not successful.  After being promoted to manager I reassigned all of my prospects to an experienced sales rep from my unit, who quoted and sold the prospect that I thought should have been my account for years.

She advised that we had ‘won’ the business and that we were going to do a meeting to introduce our team and ‘install’ the business.  Three weeks later, she lamented, “This is the most difficult account that I have ever worked with!  Nothing is good enough.  They demanded new and special payment terms, they still have not paid their deposit, and they want to tell us what suppliers we need to work with.  I am not sure that we can last with them!”

Well, this situation is not unusual.  It is difficult to know how much trouble a new customer is going to be until they are in the fold.

What is A Good Customer?

It sounds simple enough to suggest that as a sales professional you would want as many of your customers as possible to be “good” customers.  They won’t all be good customers, but the reasons why you want the good ones is because they are predictable and can be an advantage for your.  In sales you need every advantage you can get so you want to align yourself with the kind of customers that everyone else covets.

We will simply define the traits of a good customer:

• Prompt and responsible in payment
• Communicates well
• Provides unsolicited feedback on you and your organization
• Suggests customers/clients for you
• Acts as a reference for you and your company

This list is not all-inclusive as I am focusing on the main customer traits that benefit the sales professional.

Prompt Payment – You know this drill!  Some sales professionals don’t get paid until the monies are collected.  Any client that is delinquent, or elects not to pay costs you and your company ridiculous amounts of money.

Communicates Well – This customer is respectful of your time and efforts and lets you know by communicating meaningfully and with intent.

Provides Feedback – Gives relevant feedback to you on your efforts and your company’s products and services.  Gives feedback the right way, personally and constructively.

Loyal – Loyal customers give you an opportunity to rectify any problems or deficiencies, including pricing issues, before making relationship-ending decisions.  They stick by you and do not make a change for nominal differences in price.

Refers Customers to You – This customer will refer their relationships and ‘business friends’ to you recognizing that they will be taken care of and will receive the great service that you give to them.  This is extremely important to Black sales professional as it gives you an opportunity to have the credibility that the referral gives you to help make the sale.

Acts as a Reference for You – You can count on this customer when you have a new relationship and need someone to sing your praises.  Again, this is important to the Black sales professional for the reasons above (Refers Customers to You).

The Intangibles – They Cost Money!

Spend some time doing a good evaluation on your customers.  Be careful though, as it is the intangible items that really cost money.  A relationship with a customer who pays late, ask for more, and will leave for a dime is not going to end up good for you.

Be cognizant of the intangibles as the costs are hard to recognize.  Do you have to provide additional services and visits because they won’t do what all of the other clients do?  Are they unduly critical of your team and your service personnel?

Know whether the complaints are justified, and if not, you must, I repeat must; stand up for your team.

Customers…We Can’t Do Without Them

I comment often that “we can’t do without them”, and that is the truth.  They are the reason that we exist in our respective roles.  It is our job as sales professionals to make sure that we get the right ones.

In our effort to survive and prosper in our jobs, we sometimes take on customers who do not deserve us.  I am sure you know some now.  If they get in your way of prospering and selling to other clients, they are costing you money.    Think about it hard!  Consider at what point you take action if it is problematic.

What is the Lifetime Value of Your Customer?

Give some consideration to figuring out the lifetime value of your customer.  We are talking about an economic value.  This isyour lifetime value, not the lifetime value that your company receives.  This figure is based on the length of relationships, the revenue received from the relationship in terms of bonus or commissions and the amount of compensation that you receive from their referrals, references, and other contributions to your existence.

The lifetime value could be estimated by knowing the following:

• Average annual revenue (commission/bonus) from your customer.
• Average period of time a customer stays.
• Total revenue earned from this customer’s referrals.

Oversimplified, here is the quick and easy formula to show relative lifetime value.  Relative means that you can compare it against your other clients effectively:

Lifetime Value = [Annual Commission Revenue  * Average Period of Relationship] +Total Revenue From Referrals

Or…..

LV = [ACR *APR] + TRR

Here is an example:

Customer A:

Annual Commission Revenue – $20,000
Average Period of Relationship – 4.5 years (company average)
Total Revenue from Referrals – $0

LV = [20,000 * 4.5] + $0 Referrals
LV = $90,000

Customer B:

Annual Commission Revenue – $12,000
Average Period of Relationship – 4.5 years (company average)
Total Revenue from Referrals – $ 30,000

LV = [12,000 * 4.5] + 30,000 Referrals
LV = 54,000 + 30,000
LV = $84,000

In both examples you can see the effect of referrals.  Customer A pays the bills, yet they are not helping your revenue as much as Customer B, who is a good customer overall as they referred you to new relationships and new revenue.  The moral of this story is…”Customers are not created equal”.

The total referral revenue is understated as it should show revenue from the referral relationship in total, and that could be much more substantial.  I hope you see the logic.

Always do a good evaluation and realize that a good customer is more than the commissions or bonus from that customer.  Know the facts.

Your comments are welcome.

There is no easy way to be the best.  Part of it is achieving skills and attributes, and part of it is just plain hard work    The skills in this post will make a noticeable difference quickly.  Paying attention to these, and you wil see the benefits early and often.  Always be the best!

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I hope I never sound like a broken record, but there are some ‘rules’ that I believe in.  One of them is being prepared; another is mastering the relationship.  Those two are important, but there are more.  Realize that you can change the game with these skills and activities.

It is imperative that you have command of some very important skills to help you be successful.  We are going to make the assumption that you have a command of the requisite sales skills.  Warning…those skills are not enough.  You need skills regarding relationship building, responsiveness, and being effective.

It is work being prepared, just as it is work doing those activities that make you effective.  There is no way out around that.  I assure you…these things will reward you for the rest of your career.

Skills and Activities that Change the Game!

Be an Expert or a Specialist

Visit these BSJ articles - Your Customer Needs an Expert and More On Being an Expert

Yes, your customer does need an expert.  They may not have told you, or they might have used some key phrases such as, “I need someone who understands my business.”  Customers do not want pretenders so study your trade and your area of specialization.  When you specialize, you will want to get some certification, accreditation, or degree.  In the absence of those being available, you will want some recognition notoriety.  One way or another, you want to be recognized.  Don’t take this one for granted as it definitely changes the game.

Network Effectively

Visit these BSJ articles– Networking for the Black Sales Professional and Know Your Elevator Pitch

Whether you’re a sales professional that works for a larger concern, or an entrepreneur who runs a one-person shop, you need to hone your networking skills to a degree that you are effective and efficient.  You know the importance, as the professional who is solid at networking effectively is never without someone to present to.  Yes, it is speed dating at its finest but there is no activity like it that can yield these types of favorable results.  You will get a lot of practice at this and a lot of time for trial and error.

Create Deep Enduring Relationships

Visit these BSJ Articles – Deepening Your Customer Relationships and Deepening Your Customer Relationships Part II.  I would also suggest visitingShould You Ask your Customer for Feedback?

Unless your sales job is transactional such as a one-time sale, you will need to have an actual relationship with your customer.  You will need to get to know them, listen to them, and be responsive.  If you cannot develop a relationship that is more than casual, you are always at risk for another sales professional.  Relationships take time, develop dependence, and generate trust.  Who will risk their position, project, and profits on you and your product if you have not been able to develop a relationship?

Be Responsive

Visit these BSJ articles – Responsiveness – the Objective of the Sales Professionaland Following-Up! – Correspondence Creates an Edge.

Being responsive and exceeding expectations can separate you from other sales professionals.  Excellent follow-up is an activity that needs more attention.  It can begin to give you a special preference that accrues to someone that others can only hope to copy.   The responsive professionals are in demand because they do the things that others only do intermittently.  They communicate, keep commitments, and look toward the future.  This is a requirement to be the Ultimate Sales Professional (BSJ – Ultimate Sales Professional 1, Ultimate Sales Professional 2, and Ultimate Sales Professional 3) as it definitely separates the professional. Responsiveness is easy to talk about, but more difficult to do, as it requires you to exceed customer expectations, and be what your company needs as well.  It can be done, and you will see that at a point, these two different objectives intersect at a point.

Be Memorable

Visit this BSJ article– Make Yourself Memorable

It is not good enough to be good, or even the best, if you are not remembered!  Take the time to make sure they remember you as it will show well for all reasons.  Always be the professional and never miss a chance to present your (yes, your) brand, as opposed to the company you work for.   Your brand in addition to being responsive and all of the other fine attributes, you stay close.  You drop a handwritten note showing your appreciation.  You pass along emails and newsletters that should concern the customer.  You strengthen the customer’s knowledge and he becomes dependent on you.

Master the Skills – Make the Money

There are more skills that you might need, and more that are crucial at different times, but in the sales arena, if you put these together along with the skills that make you accomplished within the organization that you work in, you can ‘change the game’.

Review the articles that I have shown, and you will see the specifics. Remember, you cannot gain mastery without working hard at these.  You will be accomplished with them!

Your comments are always welcome.