“Course-Correcting” for GrowthJanuary 14, 2009
Wisdom from Rules for RenegadesJanuary 16, 2009
Increase Revenues with Education-Based Marketing
Let’s say you sell telephone systems, like Company X does. Company X practiced sales by cold calling prospective companies to ask if they were interested in talking about a new telephone system (yuck—this is a standard product pitch). They had four salespeople making hundreds of calls per day. The result? A whopping three appointments per week. No surprises here.
First of all, every company that has a phone system more than five years old could benefit from a new phone system. Heck, more than 15 of the major providers of phone systems from just 10 years ago are now out of the phone system business. But inertia is a powerful force and the enemy of business building and good choices. If the phone system isn’t broke—why fix it?
Ready to double sales? Consider taking the following steps.
Step 1. The first thing Company X did after discovering the education-based marketing concept was target bigger companies. The bigger the company, the bigger the phone system. The bigger the phone system, the bigger the sales potential.
Step 2. The salespeople called the 2,000 largest companies in their market with two simple questions: “Hi, we’re doing our annual telephone system survey. I just need to know two things: What is the model of your phone system and how old is it?” In two days, the salespeople had a list of 508 companies with old, and often obsolete phone systems.
Step 3. Now for the real hook: Education-based marketing. The sales reps called on these larger companies with one offer: “We have a new educational program entitled The Nine Ways You’re Wasting Money on Your Voice and Data Spending.” They continued, saying: “We’ve been in the telephone business for 10 years now, and we’ve found that every company wastes money on voice and data spending in at least nine areas. We’ve put together a white paper to teach companies how to stop wasting—and start saving–money. If you ever need any help at all with your voice, data or telephone system needs, we want you to know about us. So we’re sending you our white paper.”
This approach increased their appointments ten fold, from three per week to 30 per week. This company’s revenue was $3 million the year prior to using the education-based marketing approach. After six months, Company X’s sales pipeline was $9 million strong.
To drive my point home about the power of education-based marketing, let’s review a few ineffective education-based marketing approaches, alongside more effective ones
Ineffective offer: “Let me teach you why you should list your house with me.”
Business: Financial Planner
Ineffective offer: “I want to come and talk to you about how I can help you plan for a better financial future.”
Business: Technology Services Firm
Ineffective offer: “Let me tell you how great we are at helping with your IT services.”
Education-Based Marketing Net-Net
Sales is about building rapport, not breaking it. When you sell, or pitch, you’re often breaking rapport because the prospect may be skeptical–no one wants to be “sold.” When you educate, you build rapport. Your business building efforts AND credibility is increased significantly when you start with data that is of value to the prospect. Launch all your meetings by teaching your prospect something, or by offering data that establishes that you’ve done your homework.
If your local newspaper called and offered to teach you seven things that make all businesses succeed, you’d probably find that pretty tough to decline. Sure, they’d still have to talk you into the meeting, but it would be an easier sell than talking you into a meeting to pitch you on advertising in their publication.
If you embrace education-based marketing you’ll out-market your competitors every time. Education-based marketing attracts buyers before they think about buying. It casts a wider net, attracts more buyers, and closes a higher percentage of prospects if the education you give is of true value. This is the least expensive, most effective marketing concept you’ll ever use.
What kind of a free education could you offer that would make your prospects want to meet with you? Respond to your ad? Take an interest in your direct mail approach?