Price Quotes Are For Losers

In the world of ERP consulting sales the elephant in the room is named “The Internet”.

Consultants not getting leads from “The Internet” want more.

Consultants getting leads from “The Internet” want  better quality.

The bitter truth is that most Internet leads aren’t worth the email they’ll arrive on.

The worst possible lead ends with the question “would you like to quote us?”. Unfortunately most ERP consultants are fooled into believing those words mean they’ve struck gold – when in fact they’re usually just the start of a timewasting losing bid.

The Fallacy Of The Unqualified Internet Lead

To most ERP consulting firms the Internet gives the appearance of a rich untapped source of free money (clients) reaching our for someone who cares (consultants).

For the most part that’s totally true.

However consulting firms forget the most valuable part of the client relationship – being paid.

There’s no end to the constant complaining and commiserating at conferences and seminars. The chatter’s all about how terrible the customers and prospects are.

The truth? Most of the problem lies with an ERP firm’s definition of a lead. And as I’ve said before – buying leads online sucks – and so does chasing unqualified Internet leads.

Most companies randomly searching the Internet do so for one of three reasons.

  1. Looking for a quote to keep their local provider honest
  2. Looking for a quote to keep their remote provider honest
  3. Looking for a quote to convince their boss to dump their software because it’s too costly.

Should you stop pursuing and ignore all Internet leads?

No.

Instead what you should do is filter your leads by pre-qualifying them.

Done properly this will result in 85-90% of the inbound inquiries disqualifying themselves.

If you looked carefully and honestly at your Internet leads (for purposes of this discussion I classify an Internet lead as any company that’s not within a 1.5 hour drive from your office) I’ll be you find that 85% are already vanishing – but only after you waste two or three hours providing them with free information.

Do people by nature value free information?

My experience with hundreds of Internet leads is that they don’t.

Which is why I prequalify every Internet lead.

Prequalify EVERY Internet Lead

In order to engage with a lead who comes in via the Internet they must possess at least one of these characteristics.

  • Be a subscriber to my twice monthly email newsletter which I send to over 2,500 users, consultants and CPAs. My experience is that closing these leads is 100x more likely to happen than someone who begins an email with “I found you in a search engine” (Tip: If they found you in a search engine they also found 5 of your competitors – they just forget to mention that part).
  • Willing to pay (in advance) for a comprehensive look at what they have on their existing computer.
  • You’ll be shocked how many prospects don’t know (a) what they own and (b) how it’s used. Don’t be discouraged that well over 85% of your Internet leads won’t pay for this service – instead think of it as a way to recover 2 to 3 hours of wasted free consulting time per Internet Lead (Tip: Don’t fool yourself into thinking that “even if only one lead closes it will have been worth it” – the road’s littered with unprofitable consulting firms who’ve followed that mantra).
  • Be referred by an existing customer
  • Be referred by a competitor
  • Be referred by anyone

I’ve also extended this rule to both new customers and those who already own the software and are looking to switch providers.

Be especially wary of any contact from a prospect where the person doing the inquiry is not the typical decision maker. If you’re selling ERP software then you should be dealing with the CFO or Accounting Manager and not the computer network specialist.

Never quote through a third party (typically a consultant looking on behalf of a client – aka consultant looking for someone to do a lot of work free for which the consultant will ultimately bill their client) – that is unless you enjoy writing quotes that go nowhere.

4 Replies to “Price Quotes Are For Losers”

  1. I think you’re right on the money, Wayne. In more ways than one. It’s about keeping your efforts focused on those activities that stand the best chance of earning you a sale. And random Internet leads that want price quotes are indeed a waste of time.

  2. Well said. I like the list of characteristics to look for in prequalifying a lead. It is absolutely true that clients just don’t appreciate free advice.

    However, as a consultant who has sent out RFPs and asked for quotes, I wouldn’t disqualify all of them. I’d use the same criteria you use for internet leads with the consultants. How did the consultant find you?

    1. I’m not a big fan of RFP’s. In most instances I’ve always found there’s usually a preferred source and the other bids are sought to confirm or deny the price. That’s not to say RFP’s aren’t used by others with great success — they’re just not an area I’ve ever had
      any luck with.

      Most of my Internet leads that become customers follow the progression of:

      Google Search
      Sign up for newsletter
      Reader / Subscriber 2 to 8 months
      Client

      I see very few Internet leads convert directly to a paying relationship. In the very early days of Internet we saw more conversion of early leads but not anymore. Without a prior relationship most of the web leads for me have been price checks.

  3. Hi Wayne: I think this is right on. We really look to have our local marketing such that the people we work with call us on the phone and are within 1 1/2 hours driving time. Or a customer referal as close in. Those are the people that really pay. The rest are usually a drain on time and resources.

    Regards, Mike Renner

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