Feature

posted 5 Aug 2002 in Volume 5 Issue 3

How to find and develop new clients profitably

Leading practices are realising new opportunities for developing and retaining business profitably, and maximising ROI (Return on Investment) on their marketing. Patrick Rea of Rea-TMA Marketing Group, Accredited Consultants, Chartered Institute of Marketing, describes the advanced ‘Sales Process’ strategy that helps to eliminate the imprecision and uncertainties of much practice development activity.

Sales process engineering is the highly effective marketing strategy that ensures that practice development is systematic, measurable and profitable. It eliminates the poor results and budgetary waste associated with so much marketing activity - which often relies upon a limited range of information and experience of what really works most effectively in promoting the services of a practice and consistently securing new business.

SPE, sales process engineering, was developed by marketing consultants accredited by the Chartered Institute of Marketing, the UK’s leading marketing body, and has equal application for accountancy and law firms alike that want to target major corporate organisations as prospective clients.

A number of leading accountants are the first firms to use SPE - because as a sector they often have longer experience than the legal profession of marketing and of the variable outcomes that can result. Too often, marketing activity is sporadic, with poorly defined goals and minimal measurement of the results. There is often littleunderstanding of what prospective clients want, and the actions that are required to engage their interest and secure their business.

Inevitably problems arise from this approach – for example in generating awareness when and where it matters, securing new sales leads or ‘closing the sale’ consistently. This cannot be resolved without a detailed understanding of the key issues for theprospective at each stage of the sales process, in respect of their requirements for communication and service, to then be able to address their needs precisely and compellingly.

Understanding the sales process

To ensure success in practice development, it is essential that every partner – and all personnel who communicate with clients – understand precisely the step-by-step process by which new business is developed and retained successfully. It is unreasonable and inefficient for marketing to be the sole province and responsibility of a marketing partner or manager, particularly as every client-facing activity potentially impinges on the reputation and marketing of the practice.

Conversely, when the practice understands the sales process, the whole organisation can engage in and contribute to it, to ensure a highly client-focused operation that efficiently and consistently develops profitable new business. You can identify and invest time and budget in those, and only those specific marketing activities that demonstrate a proven ROI.

SPE mirrors the requirements of prospective clients, to reflect the process by which they become aware of, then understand and are finally convinced of the additional value that your practice can potentially deliver.

SPE identifies the key stages and sequence in the sales and marketing process that you need to match to the prospects’ own ‘buying process’ – so that you can target a specific market sector for the practice’s services, and then develop and win new business and retain clients profitably. This then enables the definition of the core supporting marketing activities that are required to progress a prospective client lead at each stage – from market research and marketing communications, to sales training, presentation tools and CRM (client relationship management) IT and other activities.

The key stages in the sales process are as follows:

Market planning – to identify ‘niche’ markets;
Account planning – to understand and target key prospects;
Generate awareness – to ensure positive awareness and understanding of your practice;
Generate leads – to secure an initial response and provisional interest;
Selling: qualify and influence – to develop mutual understanding in the first and subsequent contact and meetings;
Sales: develop and sell – to define, present and sell your ‘solution’;
CRM: client relationship management and retention – to retain business profitably.

Competitive advantage

This represents a systematic, forensic process that is essential in today’s highly competitive market for accountancy and legal services. It is probable (if not certain) that each new prospective client of any significant size will already retain the services of an incumbent practice in your area of expertise. This means that you require a highly effective strategy that can be consistently followed and easily replicated, with the ‘feed-back’ mechanisms that will enable you to adjust your tactics according to changes in the market and target industry sector - arising from the economic cycle, legislation and other factors.

It is important to understand that we are defining a ‘process’, with the objective of progressing each prospect systematically from the initial (Account Planning) stage through to the final (CRM) stage of that process. This provides you with a ‘mechanism’ to progressively build mutual trust and understanding, both of the client’s wants and needs and of your own service capabilities to meet these requirements. It ensures that you can define and deliver a comprehensive service ‘solution’, one that accommodates every material issue with regard to the client’s business needs and priorities, decision-making hierarchies and individual preferences for service, information and support, for example.

This is a process that actively seeks to uncover ‘sales objections’ at an early stage –such as in relation to competitive issues, fee structures or the client’s needs for access to partners, so that objections can be directly and positively addressed for mutual agreement.

You can define the tactics required at each stage to progress each prospective client through your process. If a ‘bottle-neck’ develops – such as in securing the first meeting, after initial interest has been expressed – you can then address this issue directly and objectively.

For large ‘key account’ businesses, there may well be a protracted sales cycle – which can run to many months or even years, before the prospect is genuinely able and willing to discuss your services. In this case, your tactical plan may include provision of the communication required to maintain awareness and interest until the prospect organisation has a specific requirement.

The plan in this instance might include, for example: personalised e-mail marketing, seminars and workshops, invitations to relevant industry events, or a service ‘analysis’, to identify specific commercial areas where the client could benefit from improved or extended service provision.

Overall and at each stage of the sales process, the objective is to do whatever is required to move on to the next stage in the prescribed continuum of activity – in the knowledge that when the process is completed, you will have reached your objective. Any ‘set-backs’ can be identified and addressed coolly and objectively as valuable feed-back – which enables you to interrogate your sales process model and the particular tactics employed at the relevant stage, to refine and improve effectiveness.

Market planning

The initial task is to review the market for the services of the practice and identify those sectors that match your requirements. Parameters might include:

The match with your existing range of experience and record of success;
The business potential of the sector, such as whether it is a growth market;
Key commercial issues for the market and your ability and willingness to meet their needs profitably;
Geographic location of target businesses, for ease of access and reduced cost of contact.
From this analysis and research data acquired, you can then prioritise the ‘niche’ markets that you want to target, and develop data on:
The market size and major prospect businesses to approach;
The business cycles and key issues for the sector;
The potential applications for your services;
The publications, exhibitions, trade associations and other potential communication ‘vehicles’.

Account planning

The objective at this stage is to find out more about the companies in the market, to provide the detail you need to approach them with confidence:

What relevant services they want and those you can provide;
Which prospect companies qualify;
How they buy your type of practice services;
When they make purchasing decisions;
Who in the organisation makes and influences the decision.

Essentially, you need to be able to model their exact purchasing processes and also find out the key issues and problems they experience in using similar services. Critical to this is an understanding of the issue of the ROI for their businesses. Increasingly, the justification of ROI drives the purchasing activity of all major corporate businesses for every product and service they buy.

This means that you must have a very clear understanding of the value you can deliver, which should be quantified as specifically as possible. This value might relate to budgetary or timesavings you can provide, or the increased profitability, loss-reduction or risk aversion attributable to your services, for example.

Based upon this information, you can then develop your specific sales process in alignment with the purchasing processes and issues for the target organisations. It also enables the development of sales targets, organisation of account teams and the planning of market activity, for the next stages in the process.

Generate awareness

Generally speaking, major corporates will only buy from practices that have developed positive awareness of their practice services in the prospects’ market. This requires ‘building the brand’ and the perceived value of the practice’s activities.

There are a range of low-cost marketing communications activities that are specified within SPE, contingent upon the market audience, their requirements for information and the available ‘vehicles’ for communication, such as media publications, as well as direct marketing activity.

A core defining principle for SPE marketing communications is the use of ‘direct response’ marketing, with the objective of soliciting a reply from prospect organisations – such as to request information that your practice can develop. This might include a short report that provides relevant and helpful industry advice, based on your practice’s experience and expertise.

‘Direct response’ marketing enables you to capture information on client prospects, and ensures that, by replying, these organisations have taken the first critical step in acknowledging their interest with you. This means that you have successfully progressed the sales process for these businesses through to the next key stage in your process.

Generate leads

Now your objective is to secure your first meeting – and then subsequent briefing and development meetings - with the prospective client. Prospects may be unwilling to meet, despite their initial interest, and this is generally attributable to two reasons:

Genuine time pressures and a reluctance to commit to a meeting;
Feelings of disloyalty - often unconscious unease at the idea of speaking to a competitor of the incumbent practice;

SPE defines strategies for addressing these key issues. Generally, the approach is to communicate and highlight the importance of a meeting, as a priority within their busy schedule; and secondly to address and deflect the competitive issues. To achieve this requires definition of an agreed objective for the meeting that contributes specific and additional value to the prospect and does not directly replicate the existing service of the incumbent practice.

Sales: qualify & influence

In the first (and subsequent) meetings your goals are to:

Qualify the prospect: to ensure that there is a genuine need for your services, and that you can meet these needs profitably for your practice;
Identify, define and quantify the specific requirements for your services – the key service, commercial and organisational issues and concerns;
Establish all relevant parameters: such as decision-making hierarchies, budgets, use of competitors and time-scales.

Practices are recognising increasingly the importance of acquiring ‘consultancy selling’ skills, which are prescribed in SPE and employ the latest ‘open questioning’ techniques to meet the three objectives stated above. This not only generates the information required, but also builds trust and demonstrates an attentive professionalism in your contact with prospects.

Other issues accommodated by SPE include, among others: use of sales aids, interim reports, ‘leave-behind’ material, testimonials and seminars.

Sales: the solution

At this stage, you will have acquired all the information you need to submit and present a proposal. The SPE checklist might include:

Ensuring direct access to all key decision-makers;
Presentation and report material;
Account team briefing and rehearsal;
Pricing strategy;
Addressing ‘sales objections’ directly;
Opportunities to reduce the ‘risk’ of purchase for the client – such as by providing ‘trials’, testimonials and limited guarantees;
‘Closing the sale’ – strategies to assist the client in reaching a positive decision, as soon as possible.

CRM: retention strategy

The cost of securing a new client is on average five times that of retaining one – so it is important to maintain your existing client portfolio profitably, and to ‘grow’ each existing client account wherever possible. SPE prescribes:

'Tiered’ account strategies: so you invest in retaining and developing each client according to the current and potential value to your practice;
Regular account review meetings;
Regular client research to identify areas of (potential) dissatisfaction and new business opportunities;
Use and deployment of appropriate CRM IT and ‘account handling’ teams and mechanisms.

Conclusion

Sales Process Engineering offers an invaluable strategy template for practice development. It offers a logical and practical sequence of seven key stages that enable you to focus on the key objectives and tactics at each stage for consistently developing, progressing, closing and retaining major new client business. It provides the flexibility to respond to new opportunities, competitive issues and commercial conditions, within a singular strategic focus, to maximise revenue and profits for your practice.

Patrick Rea is director of Rea-TMA Marketing Group, practice development specialists – Patrick.Rea@rea-tma.com - and Accredited Consultants, CIM, Chartered Institute of Marketing. CIM is the UK’s leading professional marketing body and offers a free service to identify a marketing consultant to match your needs consultancy@cim.co.uk