Does online marketing work for ERP? How well? How do you deal with quick questions?

This morning I received an email from a friend in the consulting business. His question is one that I’ve received before – and one that seems to come up at every conference that I’ve attended in the last two years.

The core of the question is:

Do you make money marketing online?
Is Social Media worth the time investment?
Does it help to sell new sales or mainly attract existing users?

Is the time and effort worth it?

Here’s my answer that I emailed just a few minutes ago.

I think you have more than one question here:

a. Does online participation work to drive business?


b. How much business does it drive?

Yes. We don’t do very many projects these days for under $10,000 – though certainly not all projects are that. Some are just support plans. The typical project this year has been MAS90 upgrades.

We might do a lot more if we offered to do one-off per hour projects however in the past I’ve found them to be a waste of time because the prospect wants to be charged the one hour it took to perform the project — and forgets about the 2 hours you spent quoting/specifying it and the two hours of followup. Then if there are bugs or workarounds they don’t want to pay — and they don’t care that it takes you an hour of waiting for their IT Guy to remote connect you (rinse/wash/repeat). I’ve been down this road a LOT in prior years. I’ve learned that hourly invoicing is a bad deal all around.

And, yeah,  most  prospects swear they’re “not like the others and you’ll make money just charging for an hour because they’ll be ready…” and they’ll also dangle the promise of some huge future project (which invariably in my experience never materializes).

We have learned from past mistake and now we won’t take on a non-project client unless they enroll in a recurring phone support agreement. This is a great qualifying tool since 85% or more of web leads want to start the conversation with

“we don’t have support because we never call”….

To which I want to ask “then why are you calling” …..?

But I just lay out our policies and watch the people vanish. Most politely ask for info and then never reply to another email (the numbers are well over 85% who disappear as soon as they learn there’s a fee associated with support).

So we let other VARS chase that low hanging fruit — and many are very happy to do so and think that they’re making money.

c. Does it drive new deal business?

In my experience no but I’m a terrible salesman.

My problem? If I receive a new deal lead out of my area I’m always on guard that they are going to use me for pre-qualification, free demo, free consultation. Then at the last minute they have a change of heart (and despite swearing they were not going to buy local) they go and find a local VAR.

I’ve seen this “change of heart” again and again (and again). Therefore I just don’t get excited by out of area leads unless I have some stronger tie than a web inquiry (aka – referral, prior client, strong experience/references in a niche industry).

We get some local new deal inquiries but for the last few years new deals have been very slow (and I think this is a universal story)

d. Does the newsletter work?

Yes. My #1 source of people showing up with a check in hand ready to go with a project.

e. How to you manage the other VARS / prospects calling for free “quick questions”

I don’t get that much — though honestly (as you probably can see from Socialcast) I have found that using email is a LOT easier to deal with these free advice type questions. Phone calls generally last 30 to 60 minutes and may invite future calls. If someone is asking for a freebie (and I usually get this on the existing user side) then I email them as quick a tip as I can.

The problem with these freebies is that it tends to promote the same type of behavior as feeding stray cats. In other words these folks come back to their source of “free food” again and again — until you remove the plate of free food.

In my opinion the world of online/social/web (whatever label you want to use) is inseparable from daily business.

I can’t point to one specific area that works the best though my feeling is that email newsletters coupled with free high quality technical information would be my top two. Whatever you do – get into it for the long haul (aka be consistent).

I’ve had dismal results with telemarketing and lead purchases so I gave those up years ago. Nearly all the leads that I uncovered with these methods had the attitude of “well you called me so come on down and show me what you have” … and this was whether the people were truly in the market or not.

To make money on the web you have to be realistic about the leads and be 100% comfortable letting people who don’t fit your business model walk away and find other VARS.

Think of it as if you were fishing.

Not every fish that winds up in your net is big enough to keep. So you throw them back and hopefully they grow (more often I think they get eaten by another fish)….

I see a lot of companies chasing anything online and then they wonder why nothing closes and they don’t make money. If the lead does not meet a defined model (support, minimum fee size) then it’s not worth pursuing and politely beg off as early in the cycle as possible.

Setting minimum fee sizes may sound harsh but as technology become ever more complex there is an unbelievable amount of overhead associated with setting up and beginning  a project — no matter how simple it may seem.

I find that the more I can “template” my fees (I’m a big believer in quoting “starts at $ xx” type pricing right off the bat) the more you can get on with the business of servicing customers who will pay you.

If your experiences are like mine you’re almost 100% going to see people on the web looking to either

(a) mooch a freebie (after having a one hour conversation about their terrible prior VAR who overcharged them) or

(b) try to get you to do a project that requires moderate skills for a low fee (hourly) with the “promise” of future work.

After much trial and error I’ve become very comfortable with the market we serve, our skill level  and am confident in our skills so that I regularly (and  politely ) inform those not in that market that they should look elsewhere. I’m forever fine tuning this but I feel as if I improve a little each month.

Hope that helps

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