There was a long pause before one of them said "We elevate their brand." When I asked her to tell me more about that, they had no answer.
When your business is intellectual property-based services or products, you must know the value your knowledge work generates for clients, or you will fail to acquire clients. Here are ten tips for having the conversation about the value of your work with propsective buyers:
- The very first question is about their objectives. "What are your objectives for this work we might do together? Describe what would change, be improved or be eliminated."
- Ask again, differently, using the word 'outcomes' instead. "What outcomes do you anticipate? Typical client outcomes include quantitative outcomes such as new revenue, reduced costs or higher profit margins. What would it be for you?"
- You might ask about outcomes in terms of digital or online performance analytics. "If you measure this work by online performance metrics, what would be a meaningful increase for you?"
- It's also important to ask about qualitative outcomes: "Increased confidence, improving relationships, creating a finely-tuned team."
- Recap the objectives and outcomes and confirm that you and the buyer are on the same track. "Here's what we've talked about. Is that how you see it?" If yes, move on. If no, go back until you get agreement.
- Now you move on to the discussion of value. Begin by introducing the idea:' "Let's talk about the value you would enjoy when these objectives are met and the outcomes produced."
- Value is in the eyes of the buyer. What do they consider value? Learn how to ask this question: "What value do you anticipate if we move forward on the project?"
- There's more than one value if you encourage your buyer to elaborate. "What else would happen for you with the project? Something related, something unexpected, something exceptional?"
- When the buyer asks how you will do what you do, the answer is "I have a lot of tools and I use just the right ones for your project. For example..." You offer a brief example from a prior client that emphasizes the outcomes enjoyed by that client, and de-emphasizes your inputs. Your example should be relevant to the objectives this buyer has already told you they are seeking. Inputs are commodities. Your intellectual fire power is where your value lies. Do not offer an example of how you will work with them.
- Wrap up your conversation about value with this question: "If I can generate the outcomes you're seeking that produce the value you've described, will you be ready to move forward?" You are seeking agreement in principle. which is not to be underestimated. When you then send them a proposal, you're summarizing your conversation, not offering anything you haven't already talked about. The options you offer and the fees you associate with each option should make the buyer nod in agreement, as if saying "Yes, this is what we talked about."
The fee for each option is derived from the value of meeting the client's objectives. You can start with about a 10:1 ratio and adjust for other relevant factors. There's an art to the fee-for-value calculation and you'll get better as you do more of it.
In the past couple of months I helped two start-up consulting businesses learn these tips for speaking about objectives and value to their propsective buyers and then incorporating the conversations into their proposals. Both of them finalized their first consulting projects within one month of start-up with little difficulty. I would be delighted to work with you whether you're long established or just starting. 703-790-1424.