blair enns free seminar

Stop Giving The Client What They Want

by Blair Enns host of Pricing Creativity, a webinar on 24th May 2018blair enns free seminar

If I’d asked my customers what they wanted they would have said ‘A faster horse.’”

-Henry Ford

A mainstay of some agency new business conferences is a few highly coveted clients on the stage lecturing the agency audience on what they want from their agency partners that they’re not getting. While it would be foolish to dismiss these client entreaties out of hand, it would be just as foolish, I believe, to give them what they want.

Taking a cue from Henry Ford’s playbook, Steve Jobs famously said, “How will my customers know what they want if I haven’t showed it to them, yet?” It sounds like arrogant bluster, but he believed it and he was right.

I don’t have to cite the multiple studies that have proved human beings are terrible predictors of what they will like, I only have to ask you to recall that situation where you thought you won the pitch, because in the client’s words, “You ticked all the boxes”, only to lose out to a competitor who ignored the client’s checklist and proposed something radically different. We all know of examples of this and most of us have had it happen to us, whether we were the burned compliant rule follower or the one who challenged the client’s own ideas of what they wanted.

A friend who is undertaking a massive home renovation recently told me a story of briefing two architects on the job. Both he and his wife presented a detailed list of everything they wanted in the newly renovated home. The first architect came back with a design that ticked every box. My friends, the clients, were delighted. They didn’t think they could possibly get everything they had asked for. But the second architect essentially ignored the brief and did what he thought was best for the building. The design was radical. I think my friend used the word “shocking.” They took a couple of weeks to think about it and then went with the radical design, which not only didn’t check many boxes on their list but “scared” them and was 20% more expensive. That’s right, they paid a 20% premium for a scary solution that defied the brief.

This happens all the time. The lesson we take from it is not that we should never give the client what they want, but that often, when the client is constructing the brief on their own, they leave out things they haven’t considered or with which they have no previous experience. Those clients on stage telling agencies what they want are building those lists from their pasts. Most of their wants are about avoiding repeats of previous disasters. By indulging them the best you will do is “check all the boxes”. But who really wants to go through life just checking all the boxes? Not me, not you, and not even your clients.

Make Challenging The Client Your Competitive Advantage

In large, multi-layered firms, and in particular those where ownership is separated from management, the appetite to really challenge the client isn’t there. There may be one maverick in the firm keen on it or perhaps even two, but off to the side and in the layers above there is always at least one person who sees their role as “don’t screw this up”. So that’s the approach the agency ends up taking on the opportunity: let’s give the client what they asked for and not screw this up. That is a key difference in the culture of an entrepreneurial firm–and I mean that in the literal sense that the firm is run by an entrepreneur who not only has skin in the game but may have all their net worth tied up in it–and a firm run by managers who report to other managers who report to parent companies who report to holding companies who report to investors. The first has the authority and risk profile to challenge the client’s idea of what they want and the other has neither.

If you’re in the latter group and you find yourself competing against firms in the former and you are not pushing back, deciding what is best for the client in spite of how you’ve been briefed, then you are failing to leverage one of your most significant competitive advantages.

And it’s not just the big boys and girls that fail to push back and routinely give the client what they want. Many entrepreneurial firms behave this way too, for reasons of personality, “politeness” or poor training.

 

Start your pricing creativity training on May 24th by joining Blair at a Pricing Creativity Webinar – free to attend.  Register your interest now.

 

Blair Enns, Author, Pricing creativity

Hacking the Value Conversation

 

Blair Enns, Author of Pricing Creativity Book

Blair Enns, Author of Pricing Creativity Book

By Blair Enns, Pricing Creativity Webinar Host – May 2018, details here.

The value conversation is where value pricing theory goes to die. The difficulty in mastering this conversation is what causes most people to give up on value-based pricing completely and revert back to selling time and materials. It needn’t be so difficult, though.

There’s a hack to the value conversation that a successful former client of mine pointed out after reading the manuscript of Pricing Creativity: A Guide to Profit Beyond the Billable Hour. When he explained it to me over dinner I thought, “This is brilliant. I should put it in the book.” In the end, I didn’t include the hack because I feel strongly that mastering the value conversation is one of the most valuable skills in all of business – a skill that can transform careers and businesses. So, while encouraging you to learn that skill, I’ll now give you the shortcut. But first, some context.

Perhaps the Most Valuable Skill in Business

There are three tiers of financial success in a creative firm that I can correlate to pricing strategies. The lowest tier of true financial success is occupied by the efficient cost-based pricers – those firms that bill as many of the available hours as possible. An efficient firm might bill around $200k in adjusted gross income (AGI) per full-time equivalent employee (FTE), whereas the average cost-based firm might bill around $140k in AGI per FTE.

The next tier of success is where you find the value-based pricers – those who charge based on the value to the client and not based on their costs or inputs of time and materials. These firms escape the limits imposed by the pursuit of efficiencies, moving their AGI/FTE number north of $200k, into $250k and maybe even the $300k range.

The very highest tier of financial success, however, is reserved for those value-based pricers who master the value conversation. These firms can push into the $400k range and beyond, with no real theoretical limit. A well-facilitated value conversation not only has a profound effect on the income of the firm, it creates more value for the client and it is a thing of beauty to behold. I consider it to be one of the most valuable – perhaps the most valuable – skill in all of business.

The Value Conversation Framework

Here’s the simple four-step framework for facilitating the value conversation:

  1. Confirm the client’s desired future state (What do you want?)
  2. Agree on the metrics of success (How will we know we have achieved these things?)
  3. Uncover the value that would be created by hitting these metrics (What’s this worth?)
  4. Offer pricing guidance (I’m going to bring you a range of solutions in the $Y to $X range.)

There’s lots of nuance around the “how” of each of the four steps above, but it’s really that straightforward. You’ll notice that by the end of the value conversation you haven’t even begun to think about solutions. Your entire focus is on the client: what they want, how you’ll measure their success, how much value you might create for them, and finally, some initial ideas on what you might charge for helping to create such value. After this conversation, you retreat to think about costs and solutions, building and pricing your proposal accordingly, while following the rules set out in Pricing Creativity.

The Reality: Few Get There

So, why are there so few firms mastering what seems like a simple conversation and moving to the highest tier of financial success?

The reasons are many:

  • This mastery is a sales skill and not a pricing skill
  • It requires you to be selling from the expert practitioner position and not the vendor position
  • It’s tactical knowledge acquired from doing, not implicit knowledge acquired from reading or listening
  • It requires you to be talking to client-side executives charged with value creation and not middle managers charged with managing a project or budget
  • The first few conversations can be awkward, and few push through the awkwardness to get to the incredible riches on the other side

All of these reasons and more make a value conversation hack so valuable. So here it is…

The Hack

Early in Pricing Creativity, I tell the story of the first time I saw a one-page proposal based on value rather than inputs. It was the principal of that firm that I found myself having dinner with while the book was in pre-production. Commenting on the manuscript he said, “You left out my hack!” What did he mean, I asked? He replied that he never mastered the value conversation. (Chapter 9: Master the Value Conversation – to me, perhaps the most important chapter in the book.)

Instead, early on in the sale – much earlier than I would advocate – he would put a one-page proposal on the table with three options. But he didn’t view this proposal as the final one. In fact, he said that the initial proposal was never the final one. It was only there to serve as a catalyst for discussion over what the client really valued. The hack, according to my client, was to put at the bottom of each option, “Choose this option if X is important to you.” X might be speed to market, customer service, low risk, knowledge transfer or anything else. He would then ask the client, “Which one of these options is the most appealing to you?” The client would point to one, and in doing so, reveal what he most valued. This would direct the conversation. “Ahhh, so educating your team as we develop the product (or programme) is something important to you?”

In this way, the early proposal led to a more targeted value conversation in which the client and the firm could talk through specific value drivers that the client had revealed by simply pointing to an option, all while framed by the context of the initial prices. The discussion would result in the firm coming back with another proposal more specifically targeted to what the client most valued.

To Hack or To Hold Firm?

As someone who values rule-breaking as much as I do rule-making, I love this hack while I simultaneously worry about sharing it with you. There is no substitute for mastering the value conversation. I’ll repeat that I believe it might be the most valuable skill in all of business, but I also know that the size of the gap between those who understand value pricing and those who truly implement it is problematically large, especially in the creative professions.

As I craft this parting advice I find myself wondering what I would do if I were in your shoes (Win Without Pitching is a productised service business – we don’t value price the way a customised service firm like yours should) and I don’t think I would deviate from proper sales process and a good value conversation. But not all value conversations are good and easy, especially in the beginning. And like all good hacks, I would keep this in my back pocket for those situations where I saw that an elegant theory was clashing with my harsh reality.

So use at your discretion. If you do try it, I’d be interested in hearing how you make out.

Pricing Creativity Webinar Registration Details

Pricing Creativity Webinar Registration Details

 

Best books for Pitching and winning marketing work

I was doing some training with a client this week and they asked me about pitching for new business.
There are three books on my shelf which I have found useful in my 25 year career.
Shaun Varga – Brilliant Pitch – what to know, do and say to make the perfect pitch. Prentice Hall
Jon Steel – Perfect Pitch – the art of selling ideas and winning new business – Wiley
David Kean – How not to come second – the art of winning business pitches – Marshall Cavendish
Here’s a link to another article we wrote in 2012 on the topic – Best books on pitching for new business
David Kean was interviewed and I found this 50 minute audio interview useful.
https://www.youtube.com/watch?v=yHD4yx2pRx4

How I plan to benefit from a lost pitch

A question from Quora was sent to me to answer. And it demonstrates so neatly why many new business people get discouraged by apparent failures. My answer shows how to play the “advantage” card from a disappointment and position yourself for future success while gaining valuable business experience from the situation.

My business partner’s dad/investors asked for a pitch, to which he said no after a while, but still plans to use some of the ideas. What can I do?

I told her this idea I had for a concept store that she just shared with her Dad who offered to invest/add it to his Group. After talking a few weeks ago, he just sent us a decline letter, but she says he & his partners may still use some of my ideas. I’m lost… and she doesn’t care.. What can I do ?

How to benefit from a failed pitch

Write back to each person, individually, thanking them very much for their time in hearing your pitch. Be sure that they understand how much of the pitch was your concept/idea. Say you’re sorry that they have decided not to progress working with you at this time.

Tell them that if they use your ideas in future you will be keen to

a) work on the project, or
b) receive a commission payment to reflect your intellectual capital investment

Tell them that this is only one of many bright ideas you have to contribute to their businesses and ask for an introduction to two other people who might be keen to work with someone of your talents.

Four days later, follow up with a phone call to each one to check they got your email and to ask for the introductions.

The outcome will be that you will probably not get any money from a) or b). But the introductions you receive will give you entry into a new circle of prospective employers and clients.

Why this works

The psychology of getting them to acknowledge your contribution (which they may use in future without paying) provokes the principle of reciprocity. You gave them something of value and now you are asking for something of value in return (introductions).

The follow-up shows that you are more determined than most (e.g. your business partner) and therefore are “one to watch” for the future who may benefit them again.

Lastly, in future don’t share your ideas with your business partner again without first gaining agreement about how they are to be used and valued.

ModComs pitch pack video

B2B video brochure – cool sales tool

Matt O’Neill is the Managing Director of ModComms – a company that produces The Pitch Pack, he sent us this neat video pack which business to business marketers

ModComs pitch pack video

ModComs pitch pack video

can use to open new leads.

How does PitchPack work?

The pack is a bit like a card brochure – you open it that triggers a magnetic switch which opens the power – a logo displays for a second while it warms up and then the first video plays

A typical pack has 4 videos – they come with volume controls and the larger packs have more videos on them.  Al the components are built in – from batteries, speakers to CPU.

They are encoded to Xvid format – the reason to use a specific codec is that it is lower file size with max picture quality.  A standard has 256 mg memory of which 170 is usable the rest is operating system.  so it gives about 17 minutes of video playback.

Finish watching, close it like a book and that switches it off.

In the spine there’s a little USB port you can charge the battery and uploading the videos.

If a client wants to use it the production process is firstly to design the outer pack – card wrap – using a standard Adobe Illustrator template.  The videos have to be produced and then you have all the assets.  These are sent digitally to China.  The factory sends back a prototype in digital print (not litho).  Sometimes there are small amends, it is signed off for manufacture and production.

One thing is critical is quality assurance with Chinese factories -we include two rounds of this – locally it’s checked in Shenzen and then it’s sent out and we check a few samples too.  Then we dispatch – sometimes it’s a bulk delivery, other times we do the fulfilment individually.

As part of the marketing it’s important that the telesales follow up to fix the meetings.

What types of Business use PitchPack?

It’s any B2B organisation providing a higher value product or service.  Tech companies like it, hotels, consultancies, engineering groups and some internal comms – high level changes across global senior teams.

Integration wit the sales funnel – the clients using account based marketing principles.  Some use it for the ‘door opener’ – grab attention of a senior decision maker.  It’s critical to have a structured follow up process.  Or use it as a leave-behind or a send-after to answer questions.  Salesman can film themselves on a mobile phone giving the answers and then include other videos too.  Those companies that are a bit more sophisticated and using lead scoring, for example, the score triggers sending a pack.

Personalisation – we are used to it with paper mail, but when you show the recipient that there’s an introduction just addressed to them – it’s flattering.  Anecdotally we hear it is very powerful.

Results – using a campaign with a global software company – we did a small run of 250 packs of which 240 were distributed.  They got 23 meetings with decision makers and they’ve got 4 deals with an average value of GBP250k each.  That campaign cost 5k on the packs themselves, 7k producing one video and re-used another couple of videos.  Total campaign cost 16k.

Why should our readers try the service?

Video is growing – mobile traffic about 50-70% of mobile traffic is video now.  Cisco predicts that 1/5 of the world’s population will access video online by 2016.

As a medium, video creates feelings of trust and so when brands use real people or show people doing real things curiosity is triggered.  When making video for marketing purposes don’t put everything in.  Leave them wanting more.

Confidence in the brand is built and sometimes amusement.  If you can make video for business funny you will have next to no competition because there’s so little out there.

With that popularity it’s a blessing and a curse – the competition will only get more furious.

Marshall Mcluan said the medium is the message in 60s and these packs are both – it allows people to explore video in their own time in their own way wherever they happen to be.

This is an easy differentiation tool – stand out from the crowd.  I remember in 2005 there were personalised USB sticks but now these are ubiquitous.  This type of marketing tactic is now at its 2005 moment but in 3-5 years it’ll be old hat.

If you are producing video for the pack, the content can be re-used across other media – home page, landing pages, powerpoint, email-able files.  The results are pretty tangible – looking at it in pure numbers.

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A Closer Look at Agency Search Firms – The Future Factory

This blog post series looks in depth at firms from our List of Agency Search Firms. These are businesses who help to match brands with agencies, while helping those agencies handle pitches and get meetings. You’ll learn exactly what agency search firms do, the different services offered and what your agency needs to look for in a search firm.

The Future Factory profile

This week we’re looking at The Future Factory, a London based cold calling firm. The Future Factory aims to create leads for agencies listed with them by calling up potential clients and offering services on their behalf. The most interesting thing about The Future Factory is their hands on approach to their clients and business in general. They opt to work so close to the client, even spending several days in their offices, to really understand the agencies they work with. In doing so they then fully understand the best approach to take when cold calling for them and it develops quite a close relationship.

The Future Factory

The Future Factory

They offer:

  • Cold calling work search services for agencies.
  • Relationships management services for agencies.
  • Provide brand research and feedback for agencies.

Services for Agencies

By spending 8 days per month, half of that time in the agency’s offices, The Future Factory get clients for agencies by cold calling potential brands. They research these brands and develop relationships with them.

Before this is undertaken however they go through a rigorous understanding process whereby they get to know the agencies business and core principles. They also pass on all information about brands they get work from to their agencies and make sure they are well prepared for the meeting. In this way The Future Factory double as a relationship building firm.

Services for Brands

The Future Factory provides no services to brands directly. Rather they research what services they could provide brands and call up those brands based on a set of unknown criteria.

Charges and Fees

Monthly membership subscriptions are the only apparent payment The Future Factory takes. They decide total monthly costs based on meeting and negotiation (this may be fixed for every agency but it is unclear). These fees may possible be extended each time they win work for their clients but again this is unclear.

Key members of staff – from Linked In

Who is The Future Factory right for?

Agencies who like a hands on approach to client work will find The Future Factory to be greatly accommodating. They work closely with their clients and their testimonials suggest they regularly bring in work. They also benefit those agencies not wanting to get in too deep with an agency search firm through the monthly subscription service, meaning you can cancel any month if it’s not working out.

The risks seem low and the potential rewards seem high, so working with The Future Factory could be a good way to test the waters for newer agencies. If your relationship procurement and development skills are high as an agency though, you might want to go for more of a listing service so you have a greater presence online.

Shortcomings

No listings, only calls – With no listing or extra exposure, The Future Factory is only good for bringing in clients directly. This means if you are already a star agency at procuring and developing relationships then they may not do too much for you. If you’re looking for a greater online presence, better go with a company that  lists your on their website for seeking brands to find.

For a full list of companies in this blog post series, click through to the

Agency Search Firms Listly

A Closer Look at Agency Search Firms – Public Relations Consultants Association (PRCA)

This blog post series looks in depth at firms from our List of Agency Search Firms. These are businesses who help to match brands with agencies, while helping those agencies handle pitches and get meetings. You’ll learn exactly what agency search firms do, the different services offered and what your agency needs to look for in a search firm.

For this week we’re looking at the Public Relations Consultants Association (PRCA), an agency search firm concerning all things PR related. They do this by providing paying members (agencies) with industry data and helping them network with prospective clients.

PRCA

PRCA

They offer:

  • Agency search services where prospective clients can search through agencies listed with PRCA.

  • Offer data to paid agency members to further define their field of work and help them adapt to their environment as a company.

  • Networking opportunities, events and page listings for paid agency members to be found by prospective clients.

  • Training and qualification services aim to support practitioners in achieving their professional goals.

  • Mandatory communications management audits for agencies becoming members of PRCA.

Services for Agencies

Agencies can sign up to become a member of PRCA to gain access to a wide variety of benefits. Aside from being placed on the PRCA website to be found by clients, PRCA also help agencies train up for proposals and provide them with opportunities to network. One way they do this is by putting on various events where both agencies and prospective clients are encouraged to attend. PRCA take it one step even further by providing agencies background information and updates on the PR industry.

Services for Brands

If you’re a brand looking for an agency, PRCA provides many opportunities for you to have face time with a range of agencies and better understand what it is they do. Outside of having an agency search engine for brands on their website, brands are openly encouraged to attend meetings and events filled with agencies ready to strut their stuff. An example of this would be the “Hill + Knowlton strategies meeting” inviting senior experts from across the PR industry to speak on various topics.

Charges and Fees

PRCA runs a membership model where agencies pay on a regular basis to take advantage of a full range of services. These come at multiple levels of annual memberships for multiple type of agencies including::

  • Individuals

  • Regulation and registration

  • Students

  • Freelancers

  • Consultancies

  • In-house

  • International agencies

Key members of staff

Who is PRCA right for?

PRCA are an all inclusive package for public relations agencies to improve their skills and gain client work. Training provided by PRCA may be more or less helpful depending on the agency undergoing that training but offers that as a strong incentive to be involved as a member. Their offerings are perfect for an agency to get in, learn some skills, make a few clients and then leave if they so choose. Being membership based makes it flexible for an agency to move in and out of their system so it’s easy to test the waters and be involved in several of their events and courses early on in a working relationship with them.

Shortcomings

Hands on appraoch – Their entire search and development system is more face to face and hands on, rather than a single easy to use and searchable presence for an agency. This could be a blessing as getting clients to interact with an agency is often what they are after.
On the other hand though it does mean an agency spends much more time out of the office and engaging with prospective clients rather than working on current ones while waiting for their presence on the website to bring in more.

PR focus – PRCA focus on public relationship management service agencies first and foremost, rather than the entire range of marketing agencies out there. So if you’re looking for an great all inclusive services agency, but aren’t quite as focused on PR as you are other marketing activities, this may not be the search agency for you.

For a full list of companies in this blog post series, click through to the Agency Search Firms Listly

New business development copywriting: Stalled prospects

September is the time business gets down to work after the summer break.  Blair Enns at the Win Without Pitching team say this is the perfect time to clean out your list of prospects and new business opportunities.

Find out which ones are going to buy and which aren’t worth your time chasing further.  Blair writes

Below is a simple email template that you can use to raise deals from the dead. It works throughout the year but this week, more than any other period in the calendar, is when it works best.

THE EMAIL

It was taught to me as The Takeaway but I refer to it by the subject line that I prefer: Closing The Loop. Draft it, modify it if you dare, but send it to all those prospects you were talking to over the summer about real projects only for them to disappear on you. That’s the intended purpose of this email – to raise deals from the dead and solicit a response from someone who has been avoiding you over the summer.

Your natural inclination is probably to do the opposite of what I’m about to suggest. Resist. Do not send an overly polite email. Do not make excuses for your prospect’s behaviour over the last few weeks. Do not email in pursuit of a yes or even an answer. No, your mission is to strip away all emotions and matter-of-factly just let your prospect go. Below is how to do this and then what to expect afterwards.

Ready?

Read the detailed email Blair recommends

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A Closer Look at Agency Search Firms – Trinity P3

This blog post series looks in depth at firms from our List of Agency Search Firms. These are businesses who help to match brands with agencies, while helping those agencies handle pitches and get meetings. You’ll learn exactly what agency search firms do, the different services offered and what your agency needs to look for in a search firm.

This week we’re taking a look at Trinity P3, a firm that focuses specifically on aiding marketers and agencies find work. Trinity P3 work very closely with their clients. Instead of working through lists that agencies and brands can search, they specifically communicate to the right people to match agencies and brands together. Throughout this process they help their clients manage themselves and their connections.

Trinity P3

Trinity P3 at www.trinityp3.com/

They offer:

  • Brand resource acquisition and allocation services

  • Agency benchmarking and assessment services

  • Environmental company alignment services

  • Agency search and selection services for brands

  • Budgeting services for both brands and agencies

Services for Agencies

With Trinity P3, agencies get matched with brands and can have their company processes assessed and improved. In addition to budgeting, benchmarking and company stats tracking, Trinity P3 also offers agencies an assessment on their environmental impact as a company.

Services for Brands

With agency search and selection services (including agency assessments) and resource acquisition and allocation, Trinity P3 are an all inclusive package company for finding the right agency for a given brand. They also offer budgeting services for brands on their work. Like agencies, brands can also have their work processes reviewed and revamped by Trinity P3. They also receive the same offerings for their environmental impact that Trinity P3 offers agencies.

Charges and fees

Trinity P3 charges clients (both agencies and brands) on a case by case basis and every service they offer on their website comes with a description accompanied by a link to submit a request for a proposal.

Key members of staff

Who is Trinity P3 right for?

Trinity P3 works closely with their clients by maintaining communications rather than using menus and forms. This means they establish a close connection with you as a client and help you with more than just project management and project acquisition or deployment. Trinity P3 offers a good range of services for connecting companies to the marketing industry, suggesting they are appropriate for clients just starting out.

Shortcomings

Few contact free services – The only way to interact with Trinity P3 and their services is through direct messaging of general contact or for proposals.

Difficult to compare agencies as a brand who is searching – They do not have a detailed list of firms and contacts available to you for your assessment outside of directly messaging them. This makes search and selection difficult although still possible as they have links to their contacts so you can assess them individually.

For a full list of companies in this blog post series, click through to the Agency Search Firms Listly