Tuesday, 23 November 2010

Service Sales

We have been developing service businesses for over ten years, and one of the biggest challenges we face is in overcoming all of the sales literature out there that treats service sales the same as product sales. Time and time again, we see our clients using product sales language on their websites and in their brochures.

For a service business, the single most important thing to achieve is to establish credibility.

Service sales is fundamentally different to product sales. You are not selling a tangible thing, and so the customer is not buying a thing. They are buying a result, and since they can't touch and see that result yet, you are essentially selling a promise.

And why would a potential client trust your promise?

Therefore the most vital thing is to establish credibility.

At CGW Publishing, we help service business owners to capture their expertise and credibility in a book, and there are some other ways of doing this that are important too, especially in creating a brand around your book.

Case studies are valuable, and by writing the case study around a clear purpose, you can position yourself clearly as a business partner rather than a provider of technical components or commodity services.

For example, here's a quote from a case study which sums this all up perfectly:

“We want freedom to move on and do different things, to grow our business and explore other ventures and ABSEM have given us that freedom”

Compare that with, "The widgets that XYZ supplied us with were very good and their price was the best in town".

If you want to sell on price, the latter is fine. The problem with selling on price, though, is that you are easy prey for your bigger competitors who can exert price pressure and not feel the pain as much as you will.

Many service owner businesses offer a free consultation, but if you do this, it marks you out as a small player. A free consultation is not a try before you buy, because you can't take your time and expertise back. Free consultations are a lazy way to sell, and you won't sell any more because of them. In fact, you'll just end up giving away a lot of your valuable time for free. Preventing our clients from giving away their time is one of the toughest things to do, because time=expertise=value.

Bakers don't give away free cakes - they give away tiny samples. This serves three fundamental purposes:
  • If you like the sample, you'll buy the cake and share it with your friends
  • If you don't like the sample, you won't buy the cake which saves the bakery from the negative impact of you telling your friends you didn't like it
  • It allows the bakery to get rid of yesterday's cakes

Service business owners consistently undervalue their expertise, and in doing so have no idea what to give a client that is analogous to a 'free sample'. The most important thing to bear in mind is that free samples are NEVER free. They are merely a way to reduce the risk of a decision.

How you describe your business is vital too, and the mistake that many people make is to describe what they do instead of what they achieve.

If you introduce your business by saying 'we do XYZ' then what you attract is people who just want to buy the components of XYZ, as cheaply as possible. If you start with a business proposition, you are more likely to attract people who are looking to invest in a partnership.

For example, in choosing to work with CGW, you chose to invest in a partnership. We're not the cheapest supplier of copy writing or editing services, compared to self employed providers from India and part time working mothers from America, which you will find in abundance on marketplaces such as Elance.

Marketplaces such as Elance, Freelancer and PeoplePerHour are overrun with job requests for SEO article writing at $1 per article. We're not in that market and so we don't say anything that suggests we are. There's nothing at all wrong with that market, it's just not for us. The bottom end of the market will always be under attack. Because clients are buying on price, they will always look to drive the price down, and there will always be suppliers willing to write articles at 99¢, then 90¢, then 75¢ and so on.

If you lead with what you 'do' then you are caught in the same problem; there will always be someone else willing to do what you do for less. But no-one can easily replace a relationship that you develop with a client at a business level.

Some service business owners try to demonstrate credibility by showing that they have a methodical process, but it doesn't work. A method is implicit in the nature of your business. If you go to a cake shop, you are already assuming that they know how to bake cakes. Bakeries don't tell you how they make their cakes, unless they have some special ingredient like locally produced organic flour. But even then they don't tell you how long they are baked for, how hot etc. They deliver an end product and the process to create that is implied.

Companies only list an ingredient or a process if it is a unique differentiator, e.g. beer being triple filtered or meat being 21 day aged.

If you are an Internet search marketing agency, your knowledge of search engine marketing is implicit. If you are a presentation skills expert, your knowledge of pitching is implicit. If you area hotel, the fact that you have bedrooms is implicit.

On your website, you need to distinguish between what the visitor already knows by the time they land on your home page and what they need to know in order to make a buying decision, which they have largely done by the time they contact you.

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