Gold calling, not cold calling

Article contributed by Bill James.

Every business has one main objective: to sell its products or services. And the only way to grow that business is to sell more.

Some people think selling involves cold-calling and being pushy. But successful salespeople know this isn’t so. Cold-calling involves maximum effort for minimum return, and being pushy alienates people.

A strategy of networking and building referrals involves much less work for a much higher return.

Let’s start with networking. The most important step at a networking event is to break the ice and approach other people. Here’s a technique that works every time.

Find someone else who is standing on their own, approach them, and say, “I’m standing by myself, you’re standing by yourself, it is a network event, I thought I would say hi”.

You have just created goodwill by solving a problem for them – and you’ve made a business contact.

After a while, as you build up trust with other members, contacts start flowing. But this is a long-term strategy, with long-term benefits. You also need a parallel strategy that will bring immediate benefits.

Gaining client referrals is the best, and easiest, way to grow business. Studies show a contact is six times more likely to convert to business when it’s a referral, and is up to 16 times more profitable. There’s a reason for that: your clients know you, appreciate your service and trust you. The people they refer will have similar wants and needs – and so are more likely to become clients.

Target your 15 top clients, call them, and invite them for a coffee somewhere away from their office, where they won’t be distracted. Your phone conversation could go something like this: “Hi John. You know you’re one of my top clients. I’d like to touch base and check how things are going.

“While we’re talking, I know you enjoy the service we provide and will know other people who would enjoy the same high level of professional service and I would like to spend a few minutes finding out who they might be. Is that OK?”

With this approach you let your client know they are important, show you’re interested in them, and offer them the chance to be a hero to their contacts.

If they say no, say that’s OK and carry on with the rest of your conversation. But if they say yes, you have their permission to plunder their phone book!

It’s important to let your clients know that you will be asking for referrals – they can get upset if they expect one thing and you spring another on them. Once they are comfortable with the idea it works well.  I once gained 27 new contacts from such a meeting.

Do not treat the request for referrals as a throwaway (“You don’t know anyone else who would appreciate my service, do you?”) because your clients will treat it as a throwaway as well (“No, sorry, I don’t”).

Target only your top clients. Don’t waste your time on referrals from your least profitable, or least favourite, clients – why would you want more of them on the books?

If a meeting takes an hour and you come away with three hot prospects, that’s much better than any amount of cold-calling. And if you achieve that every week, business will boom.

Bill James hasn’t made a cold call in 15 years. He will be speaking at the at the TIME Convention, Auckland Convention Centre, THE EDGE, on Friday October 3, see www.timeconvention.co.nz