It’s common wisdom that what people want is a solution. There is even a school of sales training and many books around the concept of “solution selling”.

I disagree. Not everyone wants a solution, i.e. something solved.

Your best customer wants something specific to happen when they use your product or service.

Sometimes they want and need something else. Not everything is a “problem” for a customer; sometimes, it’s a “gap” that needs to be filled. I talk to my clients about “gaps” not “problems”.

I referred to these five valued outcomes in my “Best Practices in Pricing” session at ProductCamp Austin. (My slides from the session are on Slideshare .)

In my 30 years experience, there are actually six different results a customer values. The one to stress as a benefit and to base your product or services features depends on the Platinum Customer Profile™ of your best customers.

Your Platinum customer may want:

1. Something solved.
2. A problem reduced.
3. A way to maintain the status quo.
4. A potential problem prevented.
5. An issue eliminated.
6. An opportunity created.

I call this Situational Outcomes™ because it puts the emphasis on the right thing: results from the customer’s point of view..

Your product or service should do that. Your benefits and features presented in your collateral and website should reflect that. Your pricing should reflect the value the customer gets — is it high value, low value, moderate?.

TAKE AWAY: Before you offer to “solve” something, make sure you are really giving them what they want and value. The outcome they need may be different than you imagined. Just saying you have a solution is too simplistic and second guesses your client — never a good idea.

How do you determine what they want?  You ask. You listen intently to what they say. You respond accordingly with a product or service that can do this.

On my "Worth Reading" list.

Asking can be tough. One resource to give you ideas on good questions for all kinds of situations is Smart Questions by Dorothy Leeds (lots of examples)  and  Smart Questions by Gerald Nadler (process focus). You will find them both in my “Worth Reading” section of my blog along with other books I recommend.

I will be doing a webinar on pricing for the Business Bank of Texas on February 10 at 10am that will deal with this in more detail. On February 11 at noon,  I will do a pricing session for Tech Ranch. On March 8 at 2:00pm at Chase Bank (Northcross & Burnet Road), I will do a free RISE Austin session on the topic and be providing a Pricing Glossary &  Concepts sheet with over 50 top terms. If you would like a copy of this, please send me an email (triplett@bscusa.com).

This is a good update of the earlier book which I also like a lot.

Another book I recommend is by Thomas Nagle, the Strategy & Tactics of Pricing. It has inspired me for many years in its earlier version by Nagle and Reed Holden. This is another of my “Worth Reading” books.

Finally, when pricing make sure it does not violate laws including the Deceptive Trade Practices Act  of the Business and Commerce Code and Clayton Act (Robinson-Patman Act amendment).

What does your best customer want? Does your experience match mine that they are looking for more than just a solution? I would be interested in your opinions. Do you have books that inspire and help you formulate questions or give you pricing ideas?

Price right & reap your reward. Cartoon by Roger Stewart, Porthole Productions

Although the session has sold out, there is a waiting list. I encourage you to get on it. For more information on Austin Product Camp, go to http://productcampaustin.org. For information on my session on Pricing and the 39 other great sessions, go to http://bit.ly/e6chc0.

If  you can’t come or can’t wait, I thought I would provide some things to think about to sharpen your pricing skills. At least this will get people to reconsider their pricing strategy — hopefully they have one.

3 Wrong Ways to Price

1. Blindly following the pricing of your competitors – they may or may not be right or right for you.
2. Not knowing your “true total costs” before you price.
3. Not including profit, contingency & hassle-factor in your price structure.

3 Right Ways to Price

1. Match price to preferred positioning.
2. Choose a price that does not exceed “flinch point” of your desired Platinum Profile customer. (See my earlier post on Platinum Profile customers at http://bit.ly/arxFwB
3. Use value- based pricing rather than just cost-based pricing.

If I do the presentation, I will be talking more about best practices that I use and giving some examples of pricing problems I have addressed with clients. It is a Town Hall session so I will also be asking for attendees examples, questions and best practices. My goal is for us to learn from each other. I hope you’ll be there to share your experiences.

Do you have pricing issues, questions or examples of good or bad pricing practices?  I want to hear from you. You don’t have to wait until Saturday.

If you are going to ProductCamp, I hope you’ll vote for my session. I really want to hear what experiences others have with pricing.

Worth reading for more on lefties - good & bad

I am left-handed. It was interesting to read about other prominent lefties. Some of my favorites include: Queen Victoria, Charlie Chaplin, Michelangelo, Leonardo daVinci, Madame Curie, Henry Ford, Ramses the Great, and Joan of Arc. Several US presidents (Reagan, Ford, George W. Bush, and Clinton) were on the left – when it comes to hands at least.

Lefties have been burned at the stake, made to use their right-hands, refused as marriage partners and basically abused. Being left means we have an extra step in our learning process; to adapt the right way to do something to our way. We are acutely aware of who we are and where we are.

Wright’s comments about characteristics that make lefties successful got me thinking. Do we make good salespeople? Are we better than our right-handed colleagues. I think maybe so.

Is it only because, as all lefties know, “we are in our right mind”? That’s part of it. But here are five other reasons suggested by Wright’s book. See if you agree.

1. Good salespeople are willing to risk it all – a “Yes” or a “No”. Lefties are risk-takers. We are willing to keep on putting ourselves out front and center.
2. Good salespeople are intuitive. They need to be able to cut through the mess and get to the core. Wright says those of us who are left-handed can read situations better and more closely. We often come up with unique solutions that surprise others. (Think of lefty Sir Isaac Newton, for instance, or battle strategist Alexander the Great who conquered the known world).
3. Good salespeople are empathetic. They can put themselves in others shoes. They can make others feel more comfortable and that they really understand the situation. Those who are left-handed know what it’s like to be different and are used to being the outsider. Consider scissors, pens, ladles, etc. — all made the right-handed way. We want to be part of the “rights” but we can’t completely. So we are inclusive and try to bring people to us.
4. Good salespeople can size up a situation quickly and adjust.  Wright refers to this strong left-handed trait as “Visual Spatial Ability”. They can take in the whole picture with a quick glance. He says it applies particularly in artistic, scientific, and mathematical applications. Got something complicated to sell?  Lefties will understand it first and be able to describe it to others.
5. Good salespeople can make connections between things that at first glance seem miles apart. Lefties, Wright says, have lateral thinking. They can adapt and see a thing in terms of another. They think in metaphors. I can attest to that. Sometimes our leaps can blow a righty away. How can we think that way? Because we think in many ways all at the same time. This drives my partner crazy. I live in a world in which I don’t completely fit so I will make it fit.

Bad News Lefties

The news is not all good about lefties. We can also be hot-tempered, ambitious, solitary, iconocastic (change agents who love to destroy “the usual”) , want it our way (self taught as Wright says), experimental (“what if”, we say), and a fantasist (coming up with solutions that don’t exist within possibility at least right now).

Look at your salespeople. Who are the best ones? Bet at least 8% are left-handed. (Wikipedia says about 8-15% of the human population is left-handed.)

If your sales are down, hire a lefty. Then, stand back.

Are you a lefty, too? Do you agree?  Are you good at reading people and creating sales opportunities? I would love to hear from you. (Comments from right-handers as well as left-handers are welcome.)

How a lefty’s mind works

Musings on the author by this author:

1. Is he left-handed?
2. Is it odd for a man named “Wright” to be writing about the left? How did he feel about it?

The book is definitely worth a read. You may get other insights out of it, especially if you are left-handed.

I love Upper Crust Bakery on Burnet Road in Austin. Great birthday cakes, eclairs and great service. They always know what I want and make me feel special. A few weeks ago, one of their terrific staff told me I was a great customer. Wow!

That got me thinking. What can customers do to give great “business service”? This would help businesses have better sales and create more Platinum Customers™. It’s just what our economy needs: all of us to play a positive role and take responsibility.

It takes time and effort but there’s a huge payback for everyone. You can be that Platinum Customer™.  Are you up to the challenge?

1. Be open with me. I am not the enemy. I won’t use the information to jerk you around. I view sales as an offer to a friend. The offer is that I have something that might prove to be a good opportunity for you. Tell me what I need to know so I can make you the best offer I can. That means BUDGET and timeline, too.
2. Be respectful of my time. Things happen; you have changes in your life and business. Respect me enough to let me know as far in advance as you can. Let me know that you can’t come, will be late, aren’t prepared, etc.
3. Don’t expect it tomorrow. If you want it tomorrow, give me what I need to do it right long enough in advance. If you can’t, understand why it costs more or it might need “tweaking” when there is more time. But more than that, I have put you ahead of other priorities so a “thank you” would be nice.
4. Tell me first if you are dissatisfied. You are my quality control. I value that highly. If you must tweet about it or tell your friends, give me the opportunity to address the problem first. This is a relationship not a war. My job is to truly listen and hear what you say; then act.
5. If you just want a price, don’t call me. Go to the web. My value to you as an independent business owner comes from my total solution and my experience in helping others successfully achieve their goals. Please remember that my price has to cover: wages, taxes that support our community, my overhead costs, reasonable profit to get through hard times, and contingency funds in case something goes wrong or you don’t or can’t pay. It’s not just about what it costs me out of pocket.
6. Fulfill your obligations. I expect my Platinum Customer™ to put in some effort because after all it’s their money and their business. Work with me to make my solution work for you.
7. If you come to me for advice, don’t brag about how much you know about the topic or try to prove I’m wrong.
8. Don’t use your cell phone if you are talking to me or use it quickly and get back to business. My time is valuable, too.
9. Ask me first. If you need something that I might be able to provide, see if I can. You are under no obligation to buy but I’ve invested time with you, so give me an opportunity to serve you.
10. Make referrals without my asking you to but know whom to refer to me. I chose you as my client but I don’t choose everyone. What I have to offer is not right for everyone. I appreciate the referral but please don’t give your sister who is hard to work with.

What do you do to help provide great “business service”?

If you are a business owner and want to know how to identify Platinum Customers™, read my suggestions about how to create aPlatinum Customer Profile ™and see my slide presentation that I have given for several organizations.

Don't give your hard-earned pennies away to just ANY customer.

Everyone wants and needs sales to have a profitable and successful business. But, sales from the wrong customers can kill a business.  If you doubt me, read Angel Customers and Demon Customers by Larry Selden and Geoffrey Colvin.

What should you look for? Basically, there are two options:

• Low hanging fruit — the most responsive, easiest sale, shortest sales cycle
• High value  —  the most lucrative, harder sale, longer, requires more thorough sales process so longer sales cycle

How do you decide who is right and who is wrong? Focus on customers who are worth your sales staff’s time and efforts. The right customers have the following four traits. They:

1. Add more value than just the dollars they spend.
2. Contribute to the reputation of the company by their presence or referrals.
3. Are enjoyable to work with.
4. Match the culture of the business.

A penny saved attracts other benefits.

There are major benefits from concentrating on finding and keeping the right customers. If you have hired the right sales staff, they will close more new sales and better sales if they can point to and use what they learned from existing  “right” customers.  They can get upsell and get new sales from existing and even former customers when they are starting from the best.

If you are worried about reputation and the value of the company, the right customers are your best answer. With the right sales process and continued high touch attention and reinforcement, they bring in others like them. Why? Because, they can’t resist bragging or sharing their good fortune.

You will get customers who are not a good fit. If they are really a bad fit, even if money is tight, fire them. They take energy away that is not replaceable. They take time that you can’t afford to waste. They are not satisfied and they attract others like them.

A Case Study of Angel and Demon Customers is Still Relevant

New money can learn from experience. (This is the back of the new 2010 penny.)

Wall Street Journal staff reporter Gary McWilliams, in January 2005, wrote an article, The Customer Isn’t Always Right on Best Buy’s efforts to attract and keep the right customers. Its CEO Brad Anderson said he wanted to separate “angel” customers from the “devils”, the 20% that drove profits down.

To do this, its store clerks were given hours of training in how to identify desirable customers according to their shopping preferences and behavior. This was based on an examination of sales records and demographic data and sleuthing through computer databases to identify good and bad customers.

Other changes were also put in place. To lure the high-spenders, it stocked more merchandise and provided more appealing service. To deter the undesirables, it cut back on promotions and sales tactics that tend to draw them, trimmed them from marketing mailing lists, changed store policies based on the “bad behavior” of  “demon” customers that cost the stores time and money. The trickiest challenge was to deter bad customers without turning off good ones. But, the results were worth it, with sales gains running nearly double of what they were before this policy was put in place.

Older, wiser money

Certainly, the economic situation has changed. But the premise remains valid. In good times or bad, focus on the best and forget the rest. You may not be as big as Best Buy or think like a mass retailer but can you afford 20% losses from the wrong customers?

What can you add to this discussion?

See a penny, pick it up and all day long you'll have good luck.

What are you doing to protect your business from attracting the wrong prospects and keeping the wrong customers? Please share your successes so that we can all benefit from what you have learned. I would like to do a followup post based on reader input.

Photo credits: flickr.com/photos/sjsharktank,  /nrossi, /bad9brad, /opensourceway, /stevendepolo

Proud to be green. Here’s my paperless slide presentation, “Does Your Business Need Glasses”,  from RISE Austin 2010 on a better way to get better sales by using niche marketing aimed at a platinum customer. It makes positioning, pricing, and sales procedures more approachable for independent businesses.

It also includes details on the Business Success Center’s sales process that customers go through: from their decision to look for something to meet their needs and desires to the point they buy and then rejoice or experience buyer’s remorse.

Small business owners and entrepreneurs will want to follow the prioritized action items  in order will help avoid mistakes and expand sales opportunities. This is primarily of value to those already in business although it has ideas that startups can incorporate.

Using these ideas result in better sales and lower costs. Collateral is more effective and the sales cycle is shorter.

I have done direct mail pieces over the years that I liked and got great results with. One memorable black and white piece even got a 20% conversion  because we had the right list, the right offer, as well as the right creative graphic.

You may not agree, but I really think direct mail still has an important role to play in marketing strategy. No, Virginia, it’s not dead and this piece proves it.

Just look at it. It’s a Happy New Year card with a purpose. It came in a clear wrapping to intrigue me. Sent to my home address. I LOVE IT.

It has great appeal and is something to emulate.

Inside copy says it all - "we're looking forward to the turnaround. happy new year!" Pete & Laurie

It’s:

• Clever – it made me smile
• Modern – simple, clean typestyle and colors
• Focused – has one message
• Positive – it believes in a brighter future
• Even a bit humorous – a new year card sent in mid January that pokes fun at the current economic situation

In addition, in an under-stated way, it clearly demonstrates  two of three characteristics of a good marketing piece.

1. The presentation is unique and interesting – the graphic makes you think when you see it.
2. It presents a unique advantage – the copy suggests Laurie Smith Design is ready now – implying others aren’t.

The third characteristic is:  a good marketing piece communicates that advantage in a clear and concise way. This one is a little harder to see here unless you have a frame of reference.

I have a strong framework. I have known Laurie Smith Design, an interior planning and design firm, for many years, especially Pete Gasper, the Marketing Manager, whose card was inside.

Now I know they do more than even I remembered because I went and looked. They’ve added graphics and architecture to their list of services. So this direct mail piece was a driver for me to reconnect with them and to share their information with you.

This simple direct mail card also recalled the times Pete and I had talked and worked together on the Street MBA program* that my partner Dan and I created for Continuing Education at Austin Community College. He and his staff member Joe Prado were often speakers for the section on location. I still like to share their handout,  Laurie’s article “Offices that Work”, published in the now defunct Austin Magazine. It is still relevant. Function is still key to worker-friendly space.

It has another marketing advantage. It reminded me of what it must be like to work there and to work with them. It demonstrated their corporate culture as I understand it. Neat, talented people who can see humor where others do not, who are visionaries and encouragers. Is Rudyard Kipling’s poem “If“, your mantra?  Great job on the direct mail piece, Pete, Laurie et.al.

Special thanks to my colleague Julie Gomoll for helping me make the graphic for this post. As a technology marketing and graphics expert, she agrees with me. This is just plain neat. But, she is not so sure snail mail has much of a place in the world still.

Suggestion: ask Pete, to send you a card of your very own to study and admire. This is a keeper! You’ll find him on linkedin. If you get to him first, I  left a message saying I am trying to find out from him what response he has gotten. It should be good. He’s probably out handling all the inquiries he got from this.

Do you have a marketing piece that makes you go “Wow!”? I hope you will share it.

Sharing helps stimulate the “little grey cells” as Hercule Poirot would say. That makes everyone try a little harder to communicate better with our audience.

If you would like a copy of Laurie’s article, let me know. Always like to pass good info along.

You also might want to check out what’s happening at the Direct Marketing Association, especially the market research section.

* The Street MBA is now called the Owners MBA and done at the Business Success Center and soon to be online.

P.S. I’m looking forward to the turnaround, too. How about you?