Increase Customer Retention By Setting Proper Expectations

The first (and debatably the most important) strategy in customer retention is properly setting expectations. This actually comes during the sales process, rather than afterward, and this element ends up being the downfall of many “talented” salespeople.

Set proper expectations.

Imagine buying a new SEO service for your website. The sales person, perhaps feeling pressure to hit quota, tells you you’re going to get at least 15 leads per week, and close deals with at least three of them. Sounds pretty great, right? You buy the service and wait eagerly. And wait. And wait. Maybe a few leads come in, but you don’t hit that promised number. You feel cheated and lied to, and you cancel.

This is called “selling hot”. The salesperson will promise the moon just to close the deal. Although this tactic can generate an impressive volume of closed business (after all, who wouldn’t want to buy a product or service that can deliver such amazing results?), the turnover and cancellation rates will be equally as high, and tarnish the brand reputation. It’s a classic case of over promising and under delivering. It’s critical to set the right expectations before the deal is closed so the client doesn’t feel disappointed when their imagined outcomes don’t happen.

Now imagine the same situation, but instead of making promises in hopes of exciting you into a deal, the salesperson sets appropriate expectations. He explains to you that every client experiences different results, and you can definitely expect some new traffic with the opportunity for incoming leads and closed business (after all, the company has a great portfolio of successful clients), but the results really depend on the client. You purchase the service, get a few leads, close some business, and feel completely satisfied.

Don’t avoid setting expectations.

Sometimes salespeople will avoid setting expectations at all, which can be a big problem too. If you don’t tell the client what they can expect as a result of doing business with you, you put the client in control of setting their own expectations. This can be a huge problem. Customers will, by nature, have a preconception of how their life or business will be affected once they purchase a product or service. Typically customers set high expectations because they are investing their money in what you’re selling, and need to justify the purchase. Depending on the product, they could have wildly unrealistic expectations that simply can’t be achieved from your service. As a salesperson or account rep, you must be in charge of setting the proper expectations so you can avoid backlash from clients who don’t hit their unrealistic goals.

By setting proper expectations, your clients will know exactly what they should be getting by purchasing your product or service. There will be no surprises or disappointments. In fact, if they have an unexpectedly positive experience, they will be thrilled that the service over delivered. This, obviously, is the ideal situation.

Take the opportunity to level with your clients.

Most customers will appreciate the breath of fresh air when a salesperson can set appropriate expectations without promising them the moon. People can often see past audacious promises, and don’t like dealing with the stereotypical “used car” type of sales associate anyway. If you can relate to and level with your client, and honestly explain to them what they can expect as a client of yours, they will appreciate your honesty and like the fact that you’re not using high pressure sales tactics to mislead them into buying your product.

Retention is built on a solid foundation of meeting expectations. It’s not about under promising and over delivering (although over delivering is always great), and it’s certainly not about over promising and under delivering. It’s about setting appropriate and realistic expectations, and meeting (and/or exceeding) them consistently. If a customer knows exactly what they will get from your product or service, and their goals are met, they will have no reason to be disappointed or cancel. Decrease turnover and increase retention during the sales process by setting the right expectations.

 

Selectivity and Rejection: Why Turning Down Prospects Will Save Your Business

When I was starting out in my career, I was beyond eager to close business. I found myself pounding the phones cold calling, and often ended up somewhere between arguing and pleading with prospects trying to get them to buy. Every “no” felt like a loss to me, and I would try as hard as possible to close even the smallest deal. It became a game to me, and eventually I didn’t care about the size of the deal or the customer I was closing, I just cared about my conversion ratio and how many deals I could make.

What I didn’t know is that my effort to close every deal I encountered would end up being my downfall for the next several months.

Customer service calls and cancellations started rolling in. I was spending hours per week on the phone trying to put out fires for my smallest clients, taking me away from the opportunity to close more business. Clients who were not benefitting from the service I sold to them were giving me an earful about how upset they were, and the conversation typically ended with a threat to call their credit card company to dispute their charge. I was miserable.

After this went on for a while, I realized that this was not productive for my book of business or my commission checks, and something needed to change. I figured out that my best clients, the ones who were doing great with the service, and the ones who were paying the most to be doing business with me, were the ones who were causing me absolutely no problems. Additionally, by best clients were the ones I didn’t have to push very hard to close because they understood the value of the service I was selling, and were confident in their ability to benefit from it.

I wanted more clients like that.

I decided I would begin to be selective with my clients. I would call prospects, and if I was receiving too much push back and a refusal to buy, I would just let it go. If the prospect seemed to enjoy arguing for the sake of arguing, rather than posing relevant questions about the service and how they can benefit from doing business with me, I would decide I didn’t need their business, and politely let them off the phone. I figured that if the prospect was giving me a headache during the initial sales call, they would probably be a pain throughout their lifetime as a client. After all, there were thousands of other prospects who would understand the value of what I was selling, and would be much a more pleasant client.

Moreover, I began to identify the prospects who wouldn’t benefit from using my service. I started to understand that not every prospect would be a good fit for what I was selling, and those clients would be dissatisfied with the service despite my best efforts to keep them happy. I didn’t want clients who would not benefit from their membership with our service, because they would just cancel after their term ended. It’s not to anyone’s benefit to sell to people you can’t help. Not everyone needs to become a client of mine, and not everyone should become a client. After all, the service wasn’t a “one size fits all”; some people were just a better fit, and that’s ok.

I became drawn to having clients who would see success with my product and would continue to renew and upgrade their account with me. Identifying the elements that a “good client” embodied, I was able to avoid the less than ideal clients, and keep from investing my time trying to close a deal that will just end in an unhappy client and a cancelled account. I focused my efforts trying to recruit the ideal candidate for the service I was selling, and that has made all the difference.

To me this was a selfish approach because I didn’t want to deal with customer service calls if I didn’t have to, and I didn’t want to take more cancellations, which would be a negative representation of my sales record. However, it’s also to the prospects’ best interest, because I saved them the hassle of buying, suffering through, and fighting to cancel a service that just isn’t a fit for them. It’s not easy to turn business down, but it really makes a difference for all parties involved. Additionally, it’s the ethical and moral thing to do. Be selective with your clients, don’t be afraid to turn down a deal, and strive to work with the clients who will be the best fit for your product or service.

Get More From Your Closed Deals

You just closed a huge contract and you’re flying high on the post-deal buzz, complete with high fives from your colleagues, and a nod and thumbs up from your boss. Your commission check is going to have a little extra padding this month, and you’re feeling great. Suddenly you are hit with the heavy and disappointing realization that your pipeline is now much smaller than it was, and you no longer have this exciting contract to look forward to. It’s already closed, now what?

One of the biggest and most common mistakes companies and salespeople make is assuming that the sales avenue is over after the initial deal is closed. Worse yet is the assumption that a customer is no longer of value after they sign the contract and become a client. Ironically enough, the closed deal is just the beginning of a tremendously lucrative opportunity for the account representative who is able identify its massive potential and act on it strategically. Here’s why:

  1. Customers are often a source of repeat business. If your customer is hooked on your product or service, it’s likely they will renew their contract or use your business at another time. Customer loyalty is a huge advantage that will ensure more deals in the future as long as the service and performance is satisfactory. In fact, there are very few successful companies that have only one-time customers, so take advantage of the opportunity to retain customers through great service, a great product experience, and the presentation of new products or services that your customers would want to purchase. 
  2. The accounts of happy customers tend to grow over time. During the lifetime of a typical customer relationship, there are consistent opportunities for upselling. Whether you are adding new services to their accounts, offering additional features to compliment or facilitate their experience with your business, or selling new products they would benefit from using, your current customers are your easiest sell. This is because, as your customer, they have already established trust in you and see the value in being your customer. Upselling also increases their level of commitment to your business and makes it more difficult for them to switch to another company or provider. 
  3. Customer referrals are sales gold. Nothing is better than a hot lead, and current customers are the best source for those opportunities. If your customers are happy with their experience, they won’t hesitate to refer new business to you because most customers like to share their joy with friends/family/business partners. Creating a referral program or some kind of incentive can even be a catalyst to make your customers work for you as your own personal “sales team”. Moreover, the referrals you get will listen more carefully to your sales presentation knowing that their peer is already a happy client of yours.

The one caveat I will mention here is that growth doesn’t always happen on its own. Often you will need to seek out these opportunities by contacting your current clients and asking (again) for their business. Ask your customers to renew, to upgrade, and to refer. Don’t neglect your customers after you sell them; treat current clients just as well as, if not better than, your prospects and continue to check in and offer great customer service. Identifying and acting on these opportunities will ensure that the selling doesn’t end just because the deal is closed.

The Most Effective Sales Strategy: “What’s in it for me?”

When I consult with my clients who struggle with marketing or sales initiatives, I always start out the session asking: “what’s in it for me”? In other words, if I am a potential customer you are trying to attract with your marketing campaigns, or you are trying to sell your products or services to, what is the benefit I will get from buying from you? Always frame your value proposition as if the customers were asking you “what’s in it for me?”

Many people at this point will start rattling off all of their differentiating factors, nifty product points, or explain that they have the best customer service in the industry. This is all well and good, but it is far from relevant unless they can identify what that means to the customer. Don’t focus on the features you offer, or why you’re different from the rest; all of that information is important, and you can dive into that as needed, but what’s most important, and what you should focus your efforts on, is how you will directly affect the customers’ pain points and make their job, life, or business situation better.

Finding a pain point can be tough, and often you will need to dig deep. You could conduct market research in the form of surveys, interviews, and/or focus groups, you could ask current clients how your product or service best helps them individually, but the easiest way is to simply ask your prospect. After all, every customer faces different challenges, and what troubles some may not trouble others. Additionally, people genuinely appreciate when businesses care about their individual struggles. So get to know the prospect you’re selling to, and don’t feel uncomfortable asking them what they are looking for from your product or service. People love to talk about themselves and their business, and it makes them feel more connected to you as a salesperson or company.

Once you know what your prospective customer is really struggling with you can focus the sales efforts on their individual situation. Show the prospective customer that you relate to them and understand their unique problems (even if they aren’t so unique). Make them feel understood and special. Once you have gotten an understanding of the pain point and have communicated to the customer that you know how their struggles are affecting them, you can present your value proposition in a “what’s in it for me?” perspective. By explaining to your customer what they will gain by working with you or using your service, you will illicit a much more interested and positive response. Be sure to frame your sales pitch around how your offering can help their particular situation, make their life easier, save them time or money, etc.

Don’t make your sales presentation too feature rich; keep it simple and always address and stress how your prospect will benefit by being your customer. Don’t leave them wondering “what’s in it for me?”