Black Sales Journal

By now you know my sentiments regarding the strength of being an expert.  It was not only the post done on Black Sales Journal 12/20 -Your Customer Needs an Expert , but my many references to it in previous posts.  Being an expert gives you a type ofpreference that we all covet.  Black sales professionals should want to be bestowed with this tag any time that they can have it.

This type of preference is earned by doing those things in preparation that lays the groundwork for the ‘expert’ status.  We need to include doing things to get the notoriety and acclaim for having accomplished this groundwork.

What Makes You an Expert?

Being an expert means that you have a deep knowledge of a particular topic.  I have advocated that expert status gives youpreference, yet you still have to earn it by doing what is right in the customer’s eyes.  In other words, you still have to perform.

There are many things that may give the perception that you are an expert.  We will cover the items that generally customers perceive as helping to earn expert status.  Remember, perception is reality to the customer.

A positive perception can give you a preference that can be so powerful, possibly only being “triumphed” at times by the preference on the part of the customer of the “business friend” (Black Sales Journal 1/13 Deepening Customer Relationships) relationship level and some other relationship-based levels.

Here are some items that can help you be perceived as an expert:

• Vast experience
• Accreditations & Designations
• Education, Certifications, and degrees
• Renown Speaker
• Letters of Recommendations and Reference
• Association Membership
• Publishing

There may be other items, yet these can be meaningful in attaining an expert status.

Vast Experience – This is solid.  If you are able to boast that you have a wealth of customers and have delivered solutions to them (Black Sales Journal 6/20 Deliver Solutions, Then Sell!!), you probably can boast to be expert on a class of business, geographic area, or product.  Grouping your customers to determine your expertise would be important.  You will need to “develop” a product or “package” offering, yet this is quite doable.

Accreditations  & Designations – These are important, and very durable.  Going through some type of training or educational program, and normally testing for proficiency in the end can result in attainment.  In some cases, they are very formal, and in other cases, they are less formal, yet they yield a “diploma” in most cases.  For example, my degree from a four-year university did not mean much in the world of commercial lines insurance, so I engaged in additional educational coursework and designations (CPCU – Chartered Property Casualty Underwriter, ARM – Associate in Risk Management, and AIAF – Associate of Insurance Accounting and Finance).  I showed these designations proudly on my business card to show my expertise as well as my devotion to the industry that I was in.   It was helpful in convincing many that I was committed and qualified.

Education, Certifications, and Degrees – This one is very much like the one above.  Note that education can include the extent of your education; including bachelors and masters level education.  Certifications can include completion of certificate programs that do not render a degree, yet do show the fact that completion of the program shows some mastery of the subject matter.  A sales professional selling institutional food products and cooking implements that has a certification in food safety would be someone who a restaurant owner might listen to.

Acceptance as a Renowned Speaker – I recognize that every sales professional does not desire to be a prominent speaker.  Some know a subject matter to such a degree that they can attain a “speaker” status.  If they know the subject matter well enough to help others by speaking on it.  If you are in that group, you can allow this to work for you by making sure that you have a platform to pass the information along.  This includes press clippings, mentions in blogs, or entries in your own blog or written information.

Referrals and Recommendations – This one is simple from the standpoint of making sure that those who have benefited from your delivery of solutions “reduce it to writing.”  It allows you to distribute the document to show your expertise.  The objective is to have a proof source to support your strengths.  It is more esoteric than some of the other solutions, yet it can be effective.

Association Membership – This one certainly does not denote true expertise, yet could support your commitment and professionalism.  It can be used in conjunction with the others to show the commitment that might tip the scale.  For example, if you are a sales professional who works heavily with the general contractors, you can join a chapter of a contractor organization.  Joining the New York General Contractors Association would be evidence of support for the group as well as a commitment to working with contractors.  It can result in you having the association logo on your card, and getting great information to use in your solicitation effort such as a members list, legislative information, and current issues and events.

Publishing – This would include having your information put to print, or could be something easier to do such as blogging.  This is more work than many of the items above, yet can be fruitful.  If you do it with other items like speaking, it could be quite easy as the subject matter would be something that you had an engagement on.  One way or another, it would keep you in the public eye, and addressing the issues.

You Still Must Perform

None of this makes a difference if you don’t perform when you act in the capacity of the expert.  Researching, answering questions, and acting as counselor (BSJ, The Consultative Selling Style  6/6/2011) only works, if you know what you are talking about, and give real value.

What is normally the case is that several of the items above are combined to assure a customer of the sales professionals expert status.  The sales professional who not only has the education, but also the certifications and designations, coupled with the requisite vast experience might get consideration as an expert by a customer.

When the Black Sales professional has one of these combinations, preference is within reach as few customers will avoid dependence on a proven expert unless the water is teaming with them.

Prepare yourself, and claim your status.

Your comments are welcome.

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.