Hello - welcome to the weekly issue of THINK.ing Thursday to help you grow revenue and profit in your consulting business. My aim is to compel you to think and get clarity - without the stuffy B.S. that seems to be the norm in consulting content. If you enjoy the newsletter please forward it to a colleague. If this has been forwarded, you can subscribe here Todays theme is VALUE - In todays edition:
Tip: How To Deliver Price
Insight: The 3 Levels Of Value
New: The best CRM for Consultants?
Knowledge: The 1 Page Marketing Map
💡 Tip: How To Deliver Pricing To A Potential Client
Without a doubt, one of the biggest areas that can frustrate even the most experienced consultant is how to professionally deal with presenting price to a potential or existing client.
Let me ask you...
How comfortable are you presenting [verbally] and justifying the prices of your services?
If your heart missed a beat just thinking of that question then this information will provide you 3 key areas to focus on to ensure you never, ever stumble with the price question again.
1) Your Attitude towards the Value You Bring:
Do your clients say your services are too expensive?
Many consultants tell us "YES"
They often respond with
“It’s a battle out there”...
“clients just don’t understand the value”.
The next question we ask is:
“Do you believe your services are expensive?”
to which we hear all too often...
"Possibly... I don't know!"
There are a number of reasons why you might get yourself in this position:
- You have taken to listening to naysayers from your prospect list who tell you, you are too expensive. You have heard it so often that you now believe it’s true. It’s so ingrained that it affects your confidence in delivering prices and discounts. You are hesitant in talking about price or in fact bringing it up. You think it’s best to wait for the prospect to ask before ever mentioning it. You sweeten the delivery of the price by mentioning discounts, and additional added-in services in the same breath as your price.
- You don’t have a clear understanding of the value you bring to the marketplace and have the tools and resources to prove it. When faced with price objections you can choose to lower the price or enhance the value. Which one would you choose?
- Your services really are too expensive compared to the value they bring. If this is the case then get to work on building added value into your overall offering. Aim for a 10 times return on investment if you have no other way to price your services.
- You aren't perceived to be a Visible Expert to the market through your positioning, content, pre-engagement value provision and engagement proces
To develop unshakeable confidence in the value you bring you need to work hard at understanding the real value you bring to the market.
This will be more than just bland statements about the quality of service, reliability of support, and delivery process.
They just won’t cut the mustard in today’s business world.
START THE FOLLOWING PROCESS:
Get together with your team and/or external advisers and develop fantastic, credible, provable answers to the following:
1) What financial value are you creating for your client?
- How are you helping them make savings, win new business, shorten the supply chain and prevent downtime...as examples.
- How much financial value are you creating? - How can you prove it with facts, figures, and percentages?
- What is your client prepared to pay for? How well do you really know your prospects' business, their goal for the future, what they are spending their money on right now, and what things are they budgeting to spend on in the next 3 years?
- How can you prove value? What case studies and testimonials can you offer? How well do you understand the language of business? Can you comfortably talk about ROI, DCF, NPV, and other Industry relevant financial data?
Once you begin to clearly understand the key components of the value you offer to your clients and can prove it, your confidence in delivering, enhancing, and substantiating your value will go through the roof.
2) Your Words and Your Approach:
You may not be aware of it but in every interaction, you have with your clients and prospects the very words you use will be betraying your confidence, or lack of it, about the value you bring to the marketplace.
Consider the following phrases and ask yourself if you are guilty of any of these.
The following words and phrases clearly show you are afraid your price is too high:
- You’d better sit down before I give you my price!
- Buckle your seatbelt, I’m going to give it to you
- Are you ready for this?
- The best I can do is
The following phrases are saying to your prospective client that you are open to negotiation:
- You know, I want to work with you on this
- You know we value your custom….
- You have been a client for a long time and you know we don’t want to lose you.
- We really want to do more business in your industry
- Since you are one of our larger clients, maybe we can work with you on price a little…
The following phrases invite or challenge the client to look around or do comparison shopping:
- Comparatively speaking. I think you will find that we are the best price in the industry
- Our new reduced prices are….
- Our price is lower than anybody’s….
And then you have the phrases that clearly say to the other person that you are totally negotiable and will do anything to win the business:
- Tell me where I need to be
- What do I have to do to get your business?
- Am I in the ballpark?
- Would you be willing to pay £xxx for this?
- Of course, I can give you an even better price if….
- Well, if you were prepared to be flexible on quantity/duration…….
- Wow, - I wasn’t expecting such a big project….
All of the above phrases, lines, and approaches will have a huge impact on your ability to effectively get the price that you are seeking in a sales situation.
They generally indicate uncertainty and discomfort and either consciously or unconsciously indicate to the other person that there is room for some serious negotiation.
Can you use these to your advantage?
In a value selling world you generally want to steer clear of the approaches and phrases indicated above unless you know what you are doing and why.
There are times when these can be used deliberately in your sales approach, although not to substantiate value or premium pricing.
Let me give you an example from a client engagement. My client operated in a commodity marketplace, selling a commoditised product with little sophistication.
In fact, most of the profit in the business came from the back–end.
In their business, the back–end was the recycling of the waste products produced by using the initial commoditised product.
This was where the real money was made.
They wanted to develop a sales approach that ensured they maintained a profit margin on the initial sale but also ensured that they were positioned to win all business because of the profit potential of the by-products and back-end.
One aspect of our solution to their sales approach was to purposefully use sayings like the ones above to indicate to their customers and prospective customers that they were prepared to ‘cut a deal’ without actively saying so.
They artificially created an environment where the client requested a deal and then got one - much to their satisfaction.
For them, it worked, because they knew the psychology of their marketplace.
Their marketplace was characterised by business owners who love cutting deals. They felt they had won when they had negotiated a deal.
Normally I would not recommend this course of action but in this instance, it worked really well.
3) Not having a strategy for Offensive Tactics By Your Prospective Clients:
If you don’t have strategies planned to deal with price concession requests then the truth is you have chosen to follow a strategy employed by the other person.
It is highly likely the client has their own agenda so you must ensure you have some well thought out ways to deal with some of the common offensive strategies you might come across, such as:
- The strong-arm tactic: Here the strategy is to get you to fold by purely stating that they can’t pay anymore.
- The Better Service/Delivery: Here the implication is that they can get the exact same thing from your competitor, cheaper and with better quality or better delivery.
- The lower price initial trial: Here the pressure is to take the first engagement on a lower price to prove your worth, which once satisfied will result in a price increase at some undetermined point in the future. This never happens and prices never rise!
- We don’t care about quality, service, or delivery – it's price.
- They are unclear on their purchasing requirement: Very often waving big numbers at you with no guarantees of engagement levels.
This list is just a start because I’m sure you have experienced many more of these.
If you want to sell at higher margins than your competition then you have to create well-thought-out strategies to deal comfortably with these buying strategies or you will be trading margin - left right and centre.
There is no secret to selling at higher margins than your competition...
it takes hard work and careful preparation.
And a lot of positioning and expert status as a business.
Follow these ideas and prepare for the approaches given here and you will never have to sit in a meeting (or Zoom call) dreading the horrible moment when the Price question will come up.
Keep an eye open for a future event I'm running [details soon] where i go deep into proposal prcing and how to deliver them to clients to close a bigger %age of deals and at a bigger deal size.
✔ Habit: Schedule The Next Meeting At the End Of Every One
You're probably screaming at me right now shouting:
"Peter, this is so obvious"
Yes it is.
But the obvious things always get overlooked.
Make it a habit to schedule the next meeting routinely at the end of every meeting or call.
If the person is hesitant then use soft, non-committal language like:
"Steve, why don't we pencil in September 3rd @11? That'll ensure you don't have to worry about it in the future. We can firm it up the week before. Shall I send the invite over?"
Do this one habit every day and you'll see a marked increase in the opportunity pipeline you maintain.
🏹 Insight: The 3 Levels Of Value
Big Problem: B2B consultants struggle to articulate their value at the start of a business relationship and also at the end of an engagement at the critical time to make the next step.
The Solution: Follow a system of identifying the different layers of value and how to communicate the right way at the right time.
Profiting from this Information: Using the appropriate communication strategy you'll create more opportunities with bigger deal sizes and also create those important 2nd sales.
Recommended Action: Read the linked article and apply it: https://www.linkedin.com/pulse/3-value-statements-1-vital-client-i-bet-you-arent-using-odonoghue/
🔥 New: My Recommended CRM for B2B Consultants
One of the questions I get asked a lot is "What's the best CRM for Consultants?"
I've tried them all over the years, - Salesforce, Hubspot, Pipedrive, Salesflare, Agile e.t.c. and they have always felt just OK.
This changed a few weeks ago when I stumbled upon an amazing new CRM that had Linkedin integration, Open AI integration and is clean to look at and a pleasure to use.
I like it so much I jumped in on an annual licence and am moving my processes over to it.
Find out what it is with this video run-through here:
📚 Knowledge: A new Framework
A little bit different this week.
Usually, I reference a new book or video from a different author or expert, but today I felt compelled to share something I have been working on.
I've just finished a completely new 1 Page Marketing Framework that pulls together a completely integrated marketing campaign that should be able to drive a minimum of 5 new Consulting clients if you apply it consistently.
I'd love it if you checked it out and more importantly applied it.
And just so you know I'm not just blowing my own trumpet, here is a little bit of feedback on the framework from an early reader.
That’s a wrap!
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Thanks for reading,
Peter [hit reply if you want to ask questions]
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