It’s one of the toughest lessons for entrepreneurs to learn: Just because you can make a sale doesn’t mean you should.
Sales isn’t about pushing products; it’s about aligning the buyer’s needs with what you can offer. A customer who doesn’t actually need your offering will see that sooner rather than later. And if you can’t deliver on a buyer’s need, that tends to become clear even earlier. In either case, the damage to your reputation isn’t worth a single sale.
So how can you spot an ideal client? The following are great signs:
1. They see price as just one piece of the puzzle.
No matter what you’re selling, price matters. But reasonable buyers know that it’s not all that matters.
If you’re working with a price-sensitive consumer, don’t be afraid to ask why. The reason might be as simple as a feature the person didn’t see. If you’re making a B2B sale, ask what the company’s procurement priorities are. If you can save its team time through hands-off service, reduce vendor risks, or provide quality that your competitors can’t, your buyer may see the light.
What if price is still the sticking point? Beware that discounting can be dangerous for your brand. Not only does it set a precedent that you’re willing to sell for less, but it can also come across as a lack of confidence in your product. Neither is likely to benefit your bottom line.
2. They know their ‘why.’
The way trends sweep markets can be a double-edged sword. Sure, if you’re offering the newest, sexiest smartphone, you might be all too happy to leverage the bandwagon effect. But you might also wind up with a host of customers asking for refunds after getting buyer’s remorse.
The B2B space works the same way. Just look at what happened with marketing technology: The average enterprise has bought into 91 martech tools — yet just 13% of marketers are confident their tool set allows them to make the most of their data. It doesn’t take a detective to see that many marketers jumped on martech before understanding their company’s true needs.
3. They need a ‘Goldilocks’ amount of nurturing.
If your company sells something like dish soap, nurturing is nonexistent. But for everything from phone plans to real estate to marketing strategies, most products and services require companies to do at least a little educating before closing the sale.
If you sell something that requires nurturing, you generally know how long that process takes. If you’ve already deployed every bit of information in your arsenal, to no avail, you can see the writing on the wall. But if you’ve got a buyer who wants to sign before so much as saying “hello,” that can be a bad sign, too.
Not only can a slower sales cycle cause the customer to put a higher value on your product, but it ensures the customer truly understands what he’s buying. Customers who don’t end up using their purchase — or don’t use it to its full potential — are more likely to cancel or return it.
4. They know mistakes happen.
Whether you’re running an assembly line or an office, mistakes happen. Salespeople say the wrong thing. Marketers make claims they later have to retract.
If someone on your team screws up while trying to convert a prospect, don’t panic; treat it as a test. Is the shopper understanding, or does she demand freebies? Does he intentionally make life more difficult for the person at fault? If so, that would-be customer might be more trouble than he’s worth.
To be clear, that’s not to say you shouldn’t take responsibility. If someone on your team quoted the prospect a price lower than you’d usually offer, do you really want to lose a deal over a few bucks? Just don’t make customers think you’re a pushover because, well, they’ll push.
5. They’re loyal to others.
One factor that might help you decide whether to go the extra mile to close the sale: how the prospect operates online. Check her LinkedIn. Is she flighty, or does she stick with it? Look, too, at her activity on Facebook and Twitter. Does she follow brands? Does she bash others? Everyone has the right to have a bad day or leave a bad job, so look for trends.
Don’t let apparent loyalty be your only deciding factor, but do realize the value of long-term clients. Increasing your retention rate by just 5% could boost your profits by as much as 95%, according to research published in Harvard Business Review. Although that rate depends on the value your product or service provides, it’s also a matter of which clients you take on.
Especially in the early days, it’s tempting to take any dollar that shows up at your door. Give in to that temptation, though, and you’ll find out just how expensive some revenue can be.