Discarding clients & the math of job security

How often are you discarding clients? When fussy, needy, and/or high-maintenance clients complain repeatedly, there’s significant temptation to simply toss them out with the garbage. Some business owners build “filters” into their marketing designed to repel such clients.

When an existing client provokes thoughts of “Life’s too short to deal with this“, who fires them? How is the decision reached? Is the process documented? How is the decision communicated to the client and to your team?

Hammers, nails & curmudgeons

I asked some friends how they describe people they’d fire as clients. Their responses included unreasonable, unrealistic, frustrated, afraid, disgruntled, troublesome, pedantic, rebarbative, cranky pants, curmudgeon, etc.

Are you teaching your team that getting rid of imperfect clients is the only acceptable solution? Owners know there are situations that don’t merit dropping a client. Owners discard clients based on their experience. Does your team have that experience to back up their decisions? Take care that your team doesn’t use this tactic like a hammer while seeing every complaining customer as a nail.

It’s essential to be careful using “You’re fired!” as too-frequent use can damage your reputation. Businesses learn to detect bad apples and few are surprised when these clients get fired. Taken too far, your business can get a reputation for arrogance. People will think you discard clients the first time there’s an objection or even a question. You don’t want your reputation to be “At the first hint of a problem or even a question, they tell people to leave and not come back.” Some prospects will hear that and decide not to show up.

The math of discarding clients

Discarding clients sometimes feels as easy as pulling a splinter. The pain and aggravation fades quickly, making you wonder why you ever tolerated them. Even so, every choice to discard a client impacts your bottom line. While getting rid of high-maintenance “time vampires” will probably improve your bottom line, you have to be careful not to let your team believe that’s the only solution available. That’s where the math kicks in.

If your team gets rid of one customer a month, what does that mean to your bottom line? You likely know the typical customer’s lifetime customer value (LCV). Owners usually know how often the typical customer buys from them. They also typically know how much customers spend on average per transaction. Combined with the rate at which you are adding new customers, you can determine what an improper “firing” costs you and how long it takes to recover from it.

Uninformed profitability math

Employees don’t usually know the financial impact of discarding clients. When you explain the financials of your business to your team, it helps them understand why you think the way you do. Tools like “The Great Game of Business” (start with the book) help employees understand how the business works financially (free resources) vs. how they think it works.

Learning how the business works from a financial perspective encourages employees think more like owners. It can alter “I’m working my tail off for $15 an hour while the owner gets rich.” to something closer to reality. Even if the owner IS getting rich due in part to the risks they took & the investments they made, “uninformed profitability math” isn’t healthy. This “uninformed profitability math” rarely create behaviors that are positive for the business.

Many employees have never had the opportunity to see how their work (and how they work) impacts company financials. Meanwhile, business owners regularly complain how their people don’t think like owners. Part of that thought process is understanding the financial impact of events that occur in the business each day. Knowing that what your work does for the bottom line carries substantial value.

A “We’re having a good (or bad) month” message to employees is rarely accompanied by data explaining why. Understanding what good and bad month means affects the security a team member feels about their job. This impacts their confidence in their ability to provide for their family – and certainly affects job performance and attitude.

What does “we’re having a good/bad month” mean at your business? What message does it send to your team?

Photo by Shinichi Haramizu

Is it better to keep a customer or replace them?

“$29 per month… NEW CUSTOMERS ONLY!” Most of us have seen something like this and thought less than pleasant things about a vendor who hangs these new customer offers out in public where existing customers can see them. That bargain basement deal that’s not available to existing customers doesn’t make you feel good about your decade-long relationship with that business. The loyal customers who have stuck through good times and bad with that vendor – including their mistakes (which we all make).

The thought?

“Where’s my screaming deal?”

It isn’t that these deals are inherently bad. The mistake is putting them out there in front of everyone – including your current customers. If you can find a way to avoid showing the “loss leader for new customers only” offer to existing customers – avoid it. In some media, you can’t avoid it – so don’t use that kind of offer there. It ticks off your loyal customers. Every. Single. Time. Your customer service team gets to take flak about this each time you run these promotions.

Meanwhile, a lack of communication to existing customers plants the thought in customers’ minds that their vendors take them for granted. We know you’re thinking of us when you outsource customer service to Jupiter to save $1.29 per hour, or when you discuss how to shrink receivables. What sort of effort do you invest to retain existing customers?

If you have convinced your customers that you aren’t thinking about them & that you’re more concerned about getting new customers – why should they feel differently about you? You’re advertising for new clients everywhere. While those ads are out there chasing down more new customers to fill the leaky customer bucket, are your long-time loyal customers (and the rest of your customers) being ignored?

All the single ladies

Look at it this way: If you’re someone’s steady “significant other” and they are constantly out chasing down new “others”, most of you wouldn’t take that so well.

Why should your customers feel any different when they aren’t being wooed, cared for, thanked, communicated with, or given any special attention? They only seem to get attention when they call to report (or complain) about a service, delivery, or product failure. Once the initial sale is concluded, is the only time you connect with your clients when they contact you, or something has broken or otherwise gone wrong?

“That’s what everyone else does.”

You might be thinking “That’s what everyone else does. Why should I behave differently?

You are, or have been, a customer of car dealers, cable companies, dry cleaners, restaurants, various repair shops, handyman services, plumbers, sewage tank pumpers, electricians, hair salons, clothing stores, hardware stores, quick lube shops, etc. Almost all of them are advertising for new customers this week. How many of them are ALSO communicating with you to keep you, to bring you back, to make you feel good about being a customer, and/or encourage you to refer them to someone you respect and/or care about?

Very few.

They’ll likely continue appearing to take you for granted for weeks, months, or years – all while chasing new customers, all while grumbling about churn as they slowly lose customers to someone else’s $29 new customer offer. Don’t be that business.

Doing only one of these (looking for new, caring for existing) is not sustainable. Yes, I know it’s more work to do both. Most places need to get new customers, but most of those same places spend a lot more money & effort to get a new customer than they do to keep and care for an existing customer. Doing both means making an effort to protect the asset you paid for – yes, customers are an asset. Perhaps not in accounting terms, but in the real world where customers don’t grow on trees, we’d all rather have more long-time customers and others begging to do business with us.

Don’t spend $12 to get a customer this month, only to ignore them hereafter and hope they stick around, and then go spend $12 to get another one. That assumes you know how much it costs to get a customer (and it’s always more than you think).

Recycling customers is expensive.

Take better care of your existing clientele. Well cared for clients tend to buy more, buy more often, & for a longer period of time. They refer their friends & colleagues because they finally found someone who gets it. Be that someone.

Photo by martin.mutch

Where is the friction in your business?

What do you repeatedly force your clients to do that they simply shouldn’t have to do? Put another way, how does your business frustrate your clients? When dealing with your business, what drives them crazy?

What’s friction?

Can’t open the package without a Jedi sword? Can’t read your boarding pass printed in that microscopic font? Have to do this and this and this and that to buy or pickup a purchase, only to have to start over again? Can’t find out when something will be delivered? Have an appointment window that stretches from sunrise to sundown? Press one because your call is important to us and will be answered by the next available agent?

Yes, those kinds of things. They aren’t the sole domain of the cable company or that big company that’s easy to despise. Small businesses do these things as well, so we have to be vigilant and chase these things out of the building.

Sometimes these things are simple and inexpensive to fix, yet failing to address them creates a point of aggravation between you and your customers. These points of aggravation are often the tiniest of things. Like a grain of sand in your shoe, they could be the start of something much worse if allowed to fester.

Should it fester, you may lose a customer. Losing even one customer to one of these little things will transform that friction-creating “little thing” from inexpensive to very expensive. Remember, losing a customer usually isn’t losing a single sale – it’s losing all future sales from that customer. Friction is expensive.

How do I find these aggravating things?

Ask.

But what to ask? No matter who you’re talking to, poke around in their experiences with you regarding installation, deployment, service, customization, billing, paperwork, repairs, upgrades, financing, returns, shipping, etc. Ask questions about these things using different terms. Repeat yourself until you get the details you need. Using different terms in your questions will provoke different reactions and prod different memories from your customers.

Ask your best customers.

They’re the ones you’d hate to lose. The ones you know by name when they walk in the door. The ones whose names are familiar to your bookkeeper – and not because they don’t pay their bills. They’ll tell you different things than your newest customers, but that’s OK. There isn’t one frustration that fits everyone. Your business has many components. If you sell a number of products and services, you’ll need to ask the best customers of each. You’ll likely get different answers for each product and service.

Ask your newest customers.

Because everything is new, they’re quite likely to be more sensitive to oddities and more observant about every little thing your company does. Listen carefully to these folks. They may mention things that you’re vested in. You might get defensive. Fight that urge. There may be a perfectly valid reason for doing whatever it is. Brainstorm with the customer how you could accomplish this result in some other way.

Ask lost customers.

Did you lose a customer to another vendor? Give them a call, or see if they’ll set a time to visit in person. Make sure they understand that you aren’t there to sell them, but instead, you want to know what went wrong. What could you have done better? How did you frustrate or annoy them? This lost customer probably isn’t alone. Follow up with them once you’ve addressed the things they mentioned. A handwritten card thanking them and briefly describing what you’ve done to correct these things will both thank them and tempt them.

Preventing the growth of friction

Bear in mind that these things aren’t often created intentionally. Most of the time, “they just happen” and we miss them long enough that they become systemic. Once they become systemic, they seem normal and we have to battle a little harder to identify and evict them from how we do things.

Create a culture of ownership for finding and fixing these things. When your team has the permission to fix these things on the spot and bring the situation to your next process improvement discussion (ie: lunch), fixes don’t have to wait. Set boundaries as needed, but be careful to encourage improvement without waiting for seven signatures and a wax seal.

Photo by theilr

Personas – Like building Mr. Potato Head

The process of analyzing & building customer personas is not too much different from the process of selecting & placing body parts while creating your newest version of Mr. Potato Head. You must identify each persona, then build it out by figuring out what “parts” make each one unique. Of course, there will be aspects of some personas that are shared.

Who are your personas?

The first step to working on your personas is to identify them. For me, a mental walk-through of the business processes of a business tends to produce a fairly complete list.

Once I’ve worked through that process, I’ll assign them role-based names (such as junior astronaut, senior astronaut, or launch manager). Next, I’ll discuss the roles with someone intimate to dealing with the clientele in question. Sometimes you can talk to one person and get a good assessment of your persona list.

Discuss your persona list with front office / sales people, service / field techs / deployment teams, admins and managers at each level. When creating a list of personas, don’t assume that you know them all simply because you run the place.

Getting feedback from staffers who talk to / email with these folks on a daily basis is critical to proper identification of each persona. Your front line people in each area work with these folks every day. Their familiarity will help you accurately describe, critique, and reflect on the qualities / properties of the personas you’ve built. Multiple viewpoints across your staff will fine tune the mental sculpture of them that you’re creating.

Putting the lips on each persona

Selecting the lips to stick onto your Mr. Potato Head is fairly simple. The work to break down the different traits, habits, wants, needs, communication requirements and other aspects of each persona your business works with isn’t.

It’ll pay off when you write emails, phone scripts, letters, forms, ads and other communications intended to optimize your interaction with each persona. Optimization is really about achieving a “message to market match”.

I should clarify the “… to market” part of this. Normally when I mention message to market match, I’m referring to the market of people who buy what you sell. From that high level perspective, your market could be “people who want to buy or sell a home“. Personas drill down on that.

When producing a list of personas from your market, we focus on market subgroups. A persona like “empty nester couples between 50 and 62 who are downsizing” is a good example – and is a good bit narrower than “people who want to buy or sell a home”.

The group of people on the list of folks who want to buy or sell a home include:

  • the aforementioned empty nesters
  • millennials
  • newlywed couples
  • 25-35 couples with kids looking for room to grow
  • single folks who want an ownership experience at a waterfront property without the need to deal with yard work
  • aging couples who want a single story place that will be suitable for keeping them out of a retirement home for 10 more years
  • vacation home buyers
  • rental real estate investors

… and so on. If real estate is your thing, you can probably add to that list without much effort.

Why are personas necessary?

You want to break your customer / prospect base down to this level of detail soso that you don’t communicate with each group using the same message. A real estate ad with a couple of 50+ aged people in the photo might not attract a couple with young kids who are looking for their first home. Likewise, the reverse could also be true. The imagery *and* the words matter. It’s tough to attract anyone when you use a message they doesn’t concern them.

When you do the work to identify what is unique to each of these personas, then you can more easily decide how to communicate with them (Instagram, Facebook ad, postcard, etc) AND what to say when you do.

Winning at this almost never looks like “I created one ad and it attracted everyone.” Creating the right conversation with the right group is more work. The reward is that conversations with better context produce better results. Further, fine tuning your message will reduce the amount of time you waste on people your business / products / services aren’t a good match for.

Finally, don’t forget to use your personas to refine messaging to existing clients.

Photo by beeep

Strategic responsibility: Client Care and Feeding

The custody, guardianship & defense of your clients is a strategic responsibility for anyone interested in customer retention. When you fail to provide timely, wise counsel to your clients, it creates risk. An aging example that has a very recent twist is Windows XP. The subject is only an example, as the lesson applies to all businesses.

In 2001, the beta of Windows XP was released. I installed it on my laptop before going to a trade show in Mobile. I walked back into the booth as my sales team finished a demo of our product (a back office management system for studio photographers). The prospect was tech savvy and he had visited our biggest competitor’s booth before stopping to see us. As I arrived at the booth, the sales team had this “we’ve got trouble” look on their faces.

As I arrive, the prospect turns to me and says “I have XP beta on my laptop. When I tried your competitor’s software on my laptop over there (pointing at their booth) and it died an ugly death. Will your software run on XP when it’s released?”

XP’s moment of truth

I turned and said “No”, pausing long enough for him to start to enjoy my answer, then finished my sentence… “The demo you watched is running on XP beta. It doesn’t look like XP because I’ve disabled the XP UI. Since most people haven’t seen it, I didn’t want to distract the sales process with questions about the new UI features.

Fact is, I also hadn’t told the sales team because I wanted unvarnished feedback from them and from prospects.

I’ve always been a bleeding-edger when it comes to a new OS. I don’t install the new system everywhere, but I use them enough to assess a level of trust. In this case, I had been running an XP beta on my laptop for several months. I knew it’d be available between August and October, so when the June beta was publicly available, I hopped on it. I did most of my development and testing on it at the time because I wanted to be ready on XP launch day.

Launch day was strategically important to Windows. Many applications used by my (often bleeding-edge) clients were getting major updates for XP, including Photoshop (remember, the company’s clients were photographers). We had to demonstrate that we had their back by launching an XP-ready version the day XP became available.

That doesn’t mean that I use it 16 years later.

Client advocacy is strategic care and feeding

Back in 2012 or so, Microsoft finally provided a drop dead date for XP. 18 months in advance, the advocacy went in motion. XP was already old news, but many clients still used it. On April 8th 2014, Microsoft said they would stop issuing patches and security fixes for XP, so it was time to move on. The same situation was coming in the summer of 2015 for Windows Server 2003. Both systems were a bit behind in the OS security world and had been left behind by most software developers.

Users feel differently. They’re comfortable. They aren’t fans of things that, to the naked eye, look like change for the sake of change. To this day, you can find XP running ATMs, kiosks, announcement boards, etc. The advocacy to convince people to upgrade from XP had to happen. Some vendors forced their clients to upgrade by refusing to provide installers that worked on XP and Server 2003 (this was the strategy I selected, coupled with almost two years of advocacy).

Some vendors let their clients decide. Last week, many of their clients learned a painful lesson when the “WannaCry?” ransomware disabled (so far) over 230,000 computers in businesses and hospitals world-wide. WannaCry was effective only because the affected systems hadn’t been updated. Did IT-related businesses who have WannaCry victims as clients do enough to motivate them to perform the proper maintenance on their systems? Probably not.

Care and feeding is a strategic responsibility

The custody, guardianship & defense of your clients is a strategic responsibility. You were hired by your clients because of an established, known, and respected level of expertise in some area(s). You know more than your clients on those subjects and they should expect you to be a mentor and advocate for them. Leverage your expertise and strengths to help them protect themselves.
Photo by kyz

Sidewalks, groundhogs and accounting

A couple weeks ago, Puxatawney Phil saw his shadow. As the legend goes, this indicated that we’d have six more weeks of winter. Given the kind of winter we’ve had so far, I expect more shoveling before April and May get here. Yet we’re not here to discuss the weather, at least not specifically. As I’ve roamed Montana this winter, I’ve noticed a pattern that struck me and made me a bit curious. Is the condition of the sidewalk and parking lot in front of a business an indicator of how things are being run inside the building?

Have you have heard the theory that the condition of someone’s car is a reflection of their home and/or their life? You may have heard the same about someone with a messy desk. Whether it’s true or not, it’s an interesting parallel to the pattern that I referred to earlier. The pattern is that businesses that I know to be well-run, well-executed “tight ships” always seem to have parking lots that are cleaned up quickly after it snows – and the sidewalks in front of them in almost every case is routinely spotless, salted and kept free of ice.

I don’t have internal knowledge of all the businesses in this pattern – ie: the ones who fit and the ones who don’t, but it’s quite accurate among the ones that I have internal operations knowledge of.

Broken windows

Years ago, there was a book about crime called Broken Windows, which was based on an often argued theory that doing things like immediately fixing broken windows and removing graffiti soon as it appears sends a message to the community that the area is cared for and monitored, so the criminal element goes elsewhere. New York City applied this during its well-known (and successful) battle to reduce crime over the last couple of decades.

Crime is a complex thing when you’re looking at a large urban area. First impressions, however, are not. When you arrive at a business and notice broken windows, dirty bathrooms, dirty floors, messy work areas, a sketchy parking lot, etc – it’s difficult not to wonder how things are going in the back room. How well is that business run? What sort of initial and ongoing training to the employees receive? Are their books a mess? You may not care about how under control their accounting is, but if they can’t seem to do a good job of recording your payments, you’ll start caring.

All of these things can be indicators of bigger, deeper or widespread problems. You can’t necessarily assume – everyone has bad days or makes a mistake now and then. It’s tough to keep up with the snow when you get 48″ of snow in three days.

Why does it matter?

How businesses deal with these things tends to be an incredibly accurate indicator of what’s going on elsewhere in the company. Some have well-thought out plans for what happens on days when roads are all but impassible. For some, it doesn’t matter. For those who you need to go to the hospital, I’ll bet you’ll want them to have a snow “disaster plan” that makes sure the hospital is staffed regardless of the intensity of the weather.

You can see similar things when working with employees. It’s crystal clear which businesses invest in their staff and which ones leave them to learn by the seat of their pants. While experiential learning is often a good thing, training and reinforcement gives everyone the same foundation, and sets minimum standards within a company. Without those things, the customer-facing experience and work quality can differ substantially – the last thing you want.

Why is that important? Consistent experience is everything. People don’t want to worry about which version of your business they’re going to experience today. Why else would someone repeatedly visit the same franchise restaurant as they travel the country? They know they will have a consistent experience. They know how long it will take, what it will cost and what the food will be like – regardless of the class of fare that restaurant serves.

A consistent experience is critically important to customers. The expectation (and history) of a known-to-be-consistent experience is frequently the deciding factor when “all else is equal”, even when it isn’t.

Keeping that in mind – What kinds of signals does your business send?

This year, customer follow up will be different.

For many businesses, two things happen this time of year. One: You get a bunch of new customers. Two: Many of the new customers you acquired during this time last year “forget” to come back. The customers on the first list cost time and money to acquire. A fair amount of the people who “forget” to come back were never asked to. In other words, the business didnt invest the time / money for new customer follow up.

There is a problem with this concept. Being able to follow up requires having some contact info for your clients. These days, people are all too used to being nagged incessantly, mostly by mail and email. They’re also concerned about privacy and identity theft, which increases their reluctance to provide you with their contact info.

Why they think you’re a spammer

While it keeps the FCC and others “happy” to publish boilerplate privacy and security policies, most people either won’t read them or won’t care that you have them. Until given a reason to think otherwise, they will group your request with all the ones they’ve received before. This means that you will be thrown into the bucket with the companies who used their contact info inappropriately.

Inappropriate doesn’t necessarily mean illegal but the net impact on the business is roughly the same.

While many marketing people and business owners think otherwise, they don’t get to decide what is spam and what isn’t. The recipient does. The legal definition is irrelevant. No matter how good you think the message is, the recipient decides whether your messages are out of context, incessant, annoying or of no use. If your new customer follow up message matches any of those criteria, they will unsubscribe, opt out and might even stop doing business with you.

Even worse, they will group you with all the other spammers and be super hesitant to provide you with information in the future – even if you need it in order to serve them as they wish.

Poorly conceived customer follow up has a hard cost

Spammers are of the mind that they can send millions of emails for free. They have the luxury of not caring if they retain a “customer”. You do not. They have the luxury of not caring about the cost of a lead, much less the lifetime value of a customer. You do not.

When you send a message that feels to your customer like spam and it causes them to unsubscribe, there’s a hard cost associated with that. Think about what it cost to get that person to visit your store or website. We’re talking about labor, materials, time, consultants, employee salaries, service costs, etc. Every lead source has a cost and a ROI. The latter comes from the lifetime of that client relationship with your company.

When your message causes the client to unsubscribe, your lead cost rises and your ROI is likely to drop because the lifetime customer value of that person or business will probably stagnate.

Great, so how does my customer follow up avoid this?

Expectation management.

When they provide contact info these days, people have questions about the use of their contact info:

  • How it will be used.
  • How it will be shared (short answer: DON’T)
  • How it will be secured.

You have to be crystal clear (and succinct) when answering those questions. You have to adhere to what you said. Stepping outside the bounds of what you said you’d do, even once, breaks what little trust was granted when their contact info was shared.

Whether you feel it’s justified or not, people are hyper-sensitive to this. If you want to build a lifetime customer relationship with them, your behavior has to show it.

A suggestion

Everyone likes getting stuff on their birthday. It doesn’t have to be a (heaven forbid) 50% discount. You don’t need their birth date – which they will be protective of due to identity theft. You only need the month. During their birthday month, a simple offer or add-on that is special to them is all you need. Do you have any low cost, high perceived value services that could be given away with purchase during their birthday month? Make sure it’s clear to them that you will use this info to send them something of value during their birthday month – and stick to that.

The alternative is to keep paying more for leads. There are only so many people in your market. Nurture your clientele and show them you’re always thinking about how to help them. Win the long term game.

Strategic Notepad: Take Ownership

Last week, we talked about the opportunity presented to you when you find yourself helping a client in a stressed, deadline-driven or other pressure-filled situation. You can either create a good memory or a bad one.

We’ve talked about how to make the best of these situations and we’ve talked about the opportunity created and what I experienced with a travel agent. Sometimes people act on your behalf because you have signed a contract with them to do so. For example, I have a client that owns a bed and breakfast and they are “represented” in some fashion by online booking agents, travel review sites (like Trip Advisor) and so on. If a reservation agent treats one of their clients rudely, you can bet it will reflect on the B&B.

Take ownership

Whether you like it or not, anyone who sells for you, advertises for you, reps for you or in any way helps you sell what you do REPRESENTS YOU. Make no mistake, if they do something wrong while working on your behalf, your client will associate you with the situation – and they should. While you can’t always control whether or not these situations occur, you can certainly impact what happens when it manages to roll downhill to you.

Here’s an example of the wrong approach:

When I contacted the car rental company about the situation I was dealing with, this was their response:

Hello Mark, I can understand how this experience would be frustrating for you. Expedia is an independent third party brokerage service that is not affiliated with Enterprise. If given the wrong information such as the address and pickup time, please contact Expedia for further investigation.”

Read that again… “NOT AFFILIATED WITH ENTERPRISE”.

While I have little doubt that this description is accurate from a legal / terms of service perspective, the reality is that I rented a Enterprise car via Expedia. Affiliated or not, anything Expedia does regarding that rental certainly reflects on Enterprise whether they like it or not. Expedia doesn’t own the cars. They’re basically a combination of Google (ie: a search engine) for flights, hotel rooms and cars – and a store that can hook me up with those time and location sensitive assets.

Keep in mind that this was the response vs. something like “Hmm, that’s unfortunate and I apologize that the site sent you to the wrong address. I will reach out to our Expedia vendor rep and make sure the rental location address is corrected.” Most importantly, there was no “Can we get you a car, or have you taken care of that already?” – remember, their business is renting cars, not tweeting. There was STILL a sales opportunity and more importantly, an opportunity to “come to the rescue”. That opportunity was squandered.

While it might seem like I’m busting on the support representative who sent me this message, that’s not the case. Almost certainly, the text of this was approved by management for situations like this. A few minutes later I received the same message intended for someone else. The only difference between the message addressed to me and the second message was that the second one was addressed to “Dan” and mentioned Travelocity rather than Expedia. I politely noted that to the rep so Dan would get his message.

Canned responses are a normal part of customer support. You wouldn’t want reps who handle hundreds of messages per day retyping them, much less authoring them on the fly. The rep did exactly what she was trained to do and in fact, provided the fastest response I received from anyone – but it didn’t help me get a car.

My response to the rep is the real message of this post:

I get that, but do understand that ultimately they represent you and I suspect, do so on millions of bookings per year. Its not solely on them.

If someone sends you thousands of purchases per day, for all intents and purposes, they represent you even if the TOS says otherwise. Take ownership. People are buying your stuff from you, even if someone else takes the money. YOU deliver.

The most serious error of this entire situation was the failure to close the sale and provide a car for me. That’s the business they’re in. NEVER forget what business you’re in, or your clientele might.

The sales prevention department

Have you ever encountered a “sales prevention department”? Let’s discuss how the sales prevention department’s role works and how you can look for ways to get rid of yours if you have one.

The tale of the register tape

Over the last couple of weeks, I’ve watched the adventures of a GoToMeeting administrator. In one case, they were working with a sales person at a competitor to GoTo Meeting. I’ve been a GTM user for a long time, and in the last few months the quality and stability of the service has suffered a bit. I suspect it’s nothing terribly serious but it is a business distraction and it can impact sales if the timing of a stability problem is unfortunate. More on that in a moment.

GTM has a sales prevention department. Here’s how theirs works:

A GTM administrator manages an account with 12 seats of GoToMeeting. The admin’s company wants to add more seats. Can you login and simply add x seats to your license? No. Enter the sales prevention department. You have to call someone, wait for a call back and then deal with the potential of a sales pitch about things you may not want – all to add a few seats. This is a task that would have been completed in two minutes or less on a modern software as a service (SAAS) platform. Instead, it takes as long as a couple of days to complete this simple transaction.

For some services, a consult is necessary before a change of this nature. This isn’t one of them.

In this case, the sales prevention department is introducing unnecessary delays for the client, who only wants to give you more of their money and get more of their people working with your tools. Don’t make this difficult for your clients.

Who else has a sales prevention department?

In the time it took to deal with the process GTM places in front of their users, the GTM admin could have signed up for a competitor’s service and had a day left over…. unless it was with the competitor whose sales team I was dealing with on the GTM admin’s behalf.

The GTM competitor happens to be owned by a fairly large IP phone service that is currently receiving about $2500 a month in service fees from this company. This fact is ignored by the GTM competitor, which puts them at risk of losing not only the GTM-like business, but the IP phone service as well.

This competitor has a free, limited scope service that matches the free limited scope service GTM offers. Premium services (like recording a meeting) are critical to this evaluation, so I asked to have one account turned on for two weeks.

The answer? No, but we could come to your office and do a demo of the premium features.

At this point, the conversation is over. The GTM competitor has made it clear that they really don’t want the business. What they don’t seem to understand is that their handling of this $400 a month sales prospect threatens the $2500 monthly business they already have.

This is the sales prevention department at work.

Do you have one?

You might be wondering if you have a sales prevention department. The best way to learn that is to secret shop the sales line of your business. If you don’t have one, monitor the sales and support emails for a bit. Search them for terms like “upgrade”, “expand”, “merger” and “buyout”. The last two are possible signals that two companies have joined together and they are shopping how to supply your services to “both” companies.

You can also look at your orders for the last few months and randomly choose a few new clients, a few clients who changed the scope/size of their use of your products and services. Call them and ask to speak to whoever made the purchase. Ask them if it was easy to buy from your company. Was any part of this process difficult or frustrating? Do they have any suggestions to make the process easier?

Every time the sales prevention department takes root in your business, it hurts revenue and can cost you clients. People walk away because they don’t want to deal with a company that’s hard to work with. If it’s difficult right off the bat, that’s usually a sign of what’s to come.

Train them to make it easy to buy

Last week, we discussed the importance of training your employees to use systems well beyond the cash register, including those strategic to the company. While a normal cash register transaction is a typical customer interaction for a retail or service business, there are always the random circumstance that isn’t part of the “poke a few buttons, swipe their card or give them their change” process. In those situations, do you make it easy to buy?

What happens if you’re out of stock? This past weekend, my wife and I had an encounter with a young, polite employee of a national U.S. corporation who was dealing with an out of stock issue. The out of stock item could have been a simple logical issue rather than a physical one. Had the employee been properly trained and provided with the right systems, she would have be trained to “make it work” (hat tip to Tim Gunn), take our money and be resourceful. It didn’t turn out that way, but that’s not her fault. It’s management’s responsibility to make sure she has the systems and training to handle situations like this.

When easy to buy is out of stock

I suggest you put some thought (and some action) into training your people to make it work, rather than to say no and refuse a client’s money – where it makes sense. When it isn’t possible to make it work, your team’s training and systems should be ready to take over.

Think about what happens when an item is out of stock.

  • Do you place the item on backorder?
  • Do you have notification systems in place for your team so that they know when the out of stock item is back in stock?
  • Do you have notification systems in place for your clients so they they know the out of stock item has arrived so it can be scheduled for delivery or pickup?
  • Is your staff trained to handle an out of stock situation in a way that preserves the sale, preserves the client relationship or creates a positive memory for the customer?

Assuming you have all of that in place, what happens in the meantime?

The interim

In the meantime? In other words, even if you have out of stock situations handled well and have systems and training in place to deal with them, what specifically happens from the moment the out of stock situation is detected to the moment it is resolved? This can be seconds, minutes or months.

While the purchase was meaningless, so are many day to day purchases by your clients. The transaction may mean little in the big picture / long term, what matters is how it is handled. This situation illustrates how easily and inexpensively you can turn a failed transaction into one that people will share with their friends.

Over New Year’s, I took the family to see Star Wars. It was our first movie of 2016. The theater near us has an annual bucket program that works like this: You spend $20 on one of these buckets, which gets you popcorn today and the ability to refill the bucket for $4 for the rest of the year. In case you haven’t been to a movie lately, a large popcorn and two drinks will easily cost $20 these days, so the $4 refill for each movie is a nice savings.

Yet on January 1st, they were out of 2016 buckets. While this indicates broken inventory control, that isn’t the point. The concession stand employee said “We just ran out.” When asked if there was a way to get a rain check or pay for the bucket and take a disposable container for now, she looked baffled. Had management trained her well, she would have had a clipboard at the register, could have charged us for the annual bucket, taken our name and number (or email, whatever), given us a bag of popcorn and moved on. A 20 cent solution to retain a $20 sale for a recurring client.

Trivial but still important

Trivial, but these things that happen to your clientele every single day. How are you training your team to handle them? What systems are in place to deal with issues like this, even if the solutions are as simple as a clipboard?

Word of mouth comes from handling these things gracefully and without disruption. Prepare your team to make it easy to buy.