Monday, November 18, 2013

Why Would You Recommend a Competitor?

Years ago I was meeting with the environmental manager at a large manufacturing plant in Colorado when he asked if our firm provided air monitoring and modeling services. "Yes, we do," I responded, "but our nearest office with that capability is Chicago. And we've never done any air work in this state." I then suggested a competitor for the work.

When my boss heard about this, he was unhappy. "Why would you recommend a competitor? We could do that work!" 

"Sure, we could do the work," I replied, "but not nearly as well as [the competitor]." Then I explained why referring a competitor was the right thing to do: We had been pursuing this client for a few years and had only a couple very small jobs to show for it. It was highly unlikely we could have won the air monitoring contract anyway. And we would have missed an opportunity to demonstrate that we had the client's best interests in mind.

Given how tough it's become to win new work, you might question the logic of ever recommending a competitor for work that your firm could perform (or any kind of work). My boss certainly did. Besides the immediate contract in question, helping a competing firm might enable them to establish themselves as a preferred provider, thus limiting your future opportunities with that client as well.

That's certainly possible, but my experience has shown otherwise. When you're in the early stages of building a relationship with a prospect or client, the most important task you have is to demonstrate your trustworthiness. Particularly in the sales phase, clients are inclined question your motives, just as you do when you're in the buyer's role: "Does the seller have my interests in mind, or primarily his own?" It's clear that most buyers suspect that sellers are driven primarily by self interest.

Recommending a competitor is an effective way to demonstrate that you can be trusted to act on the client's behalf. While it may seem you're sacrificing self interest in the short term, usually it ultimately works to your benefit. This principle was illustrated in the classic movie Miracle on 34th Street. When Kris Kringle, working as Santa at Macy's, advises a customer to go to a competing store, the customer tells the toy department manager that she has now become a loyal customer. The practice of referring customers to competitors when appropriate becomes store policy and customers flock to Macy's. Why? Because they trust the store to give them the best service, even if it involves being sent to another store. Soon other stores adopt the same practice because it has become so successful for Macy's.

In contrast to the movie, I don't advocate referring competitors as a competitive strategy, rather as a simple matter of doing the right thing. Treat customers well and they'll tend to come back to you. That's been my experience, and I'm sure it's been yours too—whether you're open to recommending your competitors or not. The point is, when clients believe you care more about them than your short-term self interests, it typically works to the benefit of both parties.

What about the client in the story I opened with? The truth is they never became a substantial client, mostly because they didn't outsource many services that fit our capabilities. But we became the first firm they typically turned to for advice on environmental issues. And the environmental manager referred us to a couple of his peers that became significant clients for us.

Now I need to clarify that I'm not advocating referring competitors just because they're more qualified than your firm. There's almost always someone with better credentials. And there have been many times that I've pursued and won work that my firm (or I as an individual consultant) had never done before. But there was a common thread in almost every such case—a client who trusted that we (I) would do the right thing for them.

So why would you recommend a competitor? Because in some cases it's the best advice you can offer. And in my experience, it usually leads to opening doors to far more opportunities with that client than what you might have passed on.

Monday, November 11, 2013

Is Your Marketing Full of Empty Claims?

More is less when it comes to hyping your firm. Yet most of us who have ever penned marketing copy have been guilty of making statements that don't stand up to scrutiny. The odd thing is how often we resort to the same empty marketing claims as our competitors to try to differentiate our firms.

For example, consider the over-used phrase "full-service engineering firm." What does that mean, anyway? Is there a minimum number of engineering disciplines or services you have to have to qualify as a full-service firm? Perhaps the phrase simply clarifies that you're not a "partial-service engineering firm."

Type "unique architectural firm" into Google and you get over 477,000 hits. There are only 105,596 licensed architects in the U.S. To be fair, you could say that there's no other firm exactly like yours, hence it is unique. But I don't think that's what is implied when you market your firm that way.

A few other examples of hype that I found in a brief survey of A/E firm websites (emphasis added):
  • Our projects deliver long-term, far-reaching benefits for their communities and serve as the genesis for future community-focused development. 
  • Our goal is to raise the standards of professional consulting engineering by hiring industry professionals who understand the complexities of building and maintaining modern infrastructures.
  • We provide pioneering solutions that better our community and safeguard the environment.
  • Our firm is an award-winning leader in engineering design.
  • [The firm] accomplishes this through unparalleled customer service—from pre-design to post-design construction follow-through.
Okay, maybe I'm making too much of throw-away phrases that no one takes seriously. But isn't that the point? When you use empty marketing claims that are not really to be believed, what does that do to the value of your marketing?

Let me suggest that you avoid all such language in your marketing, proposals, and sales conversations. Meaningless claims of distinction only diminish your message. A few guidelines:

Avoid absolutes unless they're true. This includes words such as unique, unparalleled, complete, and full. Absolutes are commonly used in marketing copy but are rarely accurate. That only erodes the substance of of your marketing claims—even your true ones.

Back up your strongest claims with proof. If, for example, you claim your firm was one of the "pioneers in sustainable design for Virginia public schools," you need to back that up with evidence. Stating the obvious? You might be surprised how often such claims are made without proof. And even if the claim is true, it only evokes skepticism without substantiation.

Be diligent in compiling the evidence. A key reason firms make empty marketing claims is that they simply don't have the proof to back up what they think is true. You say your firm saves clients money or minimizes construction claims? Can you produce the numbers? Providing a handful of examples out of the many projects you've done won't cut it. If you want to make such boasts, get serious about compiling the data to support it. Most A/E firms don't.

Make sure your claimed distinction isn't routine. I often see firms boasting of their 80% repeat business rate as evidence of exceptional client service. But that's the norm in our business, in my experience. And it's not necessarily a good measure of client satisfaction. Your high repeat business rate could indicate weakness in winning new clients. Avoiding such useless claims is easier if you benchmark your firm's performance against competitors.

Beware of bloated adjectives. Much of the marketing hype we create involves the overuse of superlative adjectives like excellent, outstanding, exceptional, best-in-class, and industry-leading. I understand the temptation to use such words (I've used them many times myself), but the truth is they are at best useless, and perhaps counterproductive to your intent. Many marketing experts advise eliminating most adjectives from your marketing copy. I think it's wise to generally avoid what you might call "elective adjectives" (adjectives that aren't really needed to clarify your writing).

Identify or create tangible distinctives so you don't need to resort to empty claims. The best marketing copy is simply sharing the unadorned truth about a genuinely different company. If you struggle to avoid hype in marketing your firm, you might benefit from doing an inventory of distinctives:
  • List everything you can think of about your firm that's different or rare in your business
  • Rate or rank the items on your list according to their marketing value
  • Write down the evidence you have to support each claim on your list
  • Eliminate from your list anything that lacks adequate proof (or determine how you'll produce that proof)
You might be surprised what doing this inventory reveals. We often write marketing copy by rote without reexamining the substance of our claims. There's a good chance that you have a marketplace distinctive or two that you've been overlooking. Or you have proof of a distinctive that you haven't been using. Or perhaps you'll learn you really don't have much to brag about. In that case, it's not all bad. That revelation could serve to motivate your firm to do something about it.