This quick post is for a very niche audience. If your can’t check both boxes, close this post or read this instead… Startup. Precision beats power. Timing beats speed
Are you a Professional Services Company?
Are you the CEO?
If the answer to both is yes, read on
Who is your prospect?
Not your competitions prospect profile, but yours. If your prospects are the same as theirs you will hit a ceiling in client acquisitions.
Once you have exhausted friends, their friends, other portfolio companies and their friends and all those prospects that are just using your pricing quote to better negotiate with the market leaders, you’re fucked.
Down the road you will learn you don’t have a business. you had a funded scheme.
But, you can build a business. You have to do it proactively, not reactively. And you have to get way outside of your comfort zone. It is what Steve Blank calls getting out of the building.
Who are your clients?
If your client is the receptacle for the attrition of the market leaders, redefine the profile and find a ‘beachhead’ market that you can exclusively own and defend. Or else you’re fucked.
The 2016 business plans for the market leaders is to reclaim former clients and prospects to aggressively restore their own sales pipelines. Their levers are price and visibility. They also have more ancillary, internal, products that can create enhance profitable pricing flexibility.
Pivot you first. You’re in a comfort zone that either you either created or have enabled, we all are.
(Re)introduce yourself to your existing clients. Don’t rely on sales rep feedback because they will always discuss lowering price. Don’t rely on Client facing service reps, cos they are too sympathetic to clients and have confused allegiances.
Ask clients why they decided in favor of your company, drill. After going several layers deep they might say one, or all, of three things.
The market leaders didn’t want my business (maybe risk, demographic profile)
I was to small and they wouldn’t sign me
I wanted a cheaper, non-brand name alternative
They neglected me and/or were unresponsive
What is your client facing differentiator?
Technology: Technology is never a differentiator. In these past several years it went from a privilege to an entitlement. Technology breaks down and the human intervention to make things right is very disruptive to both sides
Your marketing and sales reps are not pitching your company, they are pitching the market leader and their technology may not be as pretty or have all the bells and whistles, but it works.
Client intimacy: Clients will always pay a premium for client intimacy. The market leaders always look first to change staffing rations away from client facing employees (like service) to improve shareholder value. Their lost client intimacy can be your door opening.
Are you charging less than the market leaders (honestly, not the delusion or the vc quarterly call)
If your service has a sustainable and recognizable differentiator then clients should pay, at a minimum, par with the market leaders. Period.
The solution
Immediately repair the damage caused by poor client selection, poor pricing discipline, poor risk controls, vanity and excessive pride in authorship.Raise prices immediately by 20%. Be rigid and inflexible.
Go on sales calls. Don’t create what clients say they want, cos they don’t really want it. Build what will be profitable to a core beachhead and they will pay a premium
Good luck. Make the world proud
Don’t you dare stare, you better moveDon’t ever compareMe to the rest that’ll all get sliced and dicedCompetition’s payin’ the price
I’m gonna knock you outMama said knock you out