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Nail the sale
1 Oct, 2009 By: Bill Hoopes Landscape ManagementWhew! what a year it's been — challenging for all with many mixed outcomes. In fact, generalizing about results could be misleading.
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Instead, I felt compelled to confirm my observations by talking to a group of successful, veteran landscape contractors, folks with records of accomplishment throughout the years. I was interested to learn how they performed during the '09 selling season.
After an admittedly random series of conversations, it was apparent results varied significantly, from modestly successful to awful. What made the difference? I learned there wasn't one lone identifiable success factor. Still, I can confirm that, in most cases, the sales process was extremely important.
During my 25 years as a Green Industry trainer and consultant, I've encountered only a few truly great marketing/sales companies. It's not that Green Industry operators are incapable of great selling; it's just that, as is often the case with technical- or production-oriented folks, selling isn't typically a core skill. It must be learned. In fact, I view selling as a process, a combination of lead-generation activities and personal follow-ups.
Begin with marketing
Did you go to market efficiently? There's no doubt gathering prospect addresses, lawn sizes and phone numbers electronically is highly efficient. Did you take advantage of the latest techniques and tools?
According to my data, direct-mail response declined. For some, it declined significantly. Successful operators I contacted didn't depend on mail. They used multiple tactics to generate leads. Examples include energetic reselling of previous customers, neighborhood canvassing, block leading and driveway marketing.
Was your message effective? Did you change your focus significantly in response to the economy? If so, did it result in enough high quality leads? Some services reduced their emphasis on quality, promoting discounts alone. But while everyone wants a deal, discounting as a singular strategy didn't deliver the results most expected.
There's no best strategy for every lawn service. The way a company sells should reflect the company philosophy and deliver what the public has been led to expect. For some larger services focused on fast, lower-profit growth, discounting may be the only choice for maximizing sales. But no one should conclude that, bad economy or not, you must discount heavily to sell lawn service. This past spring, I observed a significantly different picture.
It's been my experience that, when price is the determining factor in making a sale, the first-year cancel rate for those discounted sales is higher. A competitor will come along, offer a lower price and take the customer. If a company has the ability to outsell the cancel rate, perhaps price off selling provides a sustainable model. But for the majority of small to mid-sized services, lifetime value is key. Businesses with limited marketing budgets — and without the ability or inclination to conduct large sales campaigns — need to keep their customers. Sales based on providing what the customer wants at a fair price versus simply cutting the price and pressuring the customer all season long for added revenue delivers lower cancellations and consistently higher lifetime values.
Making the sale
The main goal for landscape contractors in '09 was the same as any year: to maximize profitable sales. For companies with large, full-time sales teams, the spring sales goal is only the first phase of a year-long campaign. For smaller companies with only part-time salespeople, spring sales must provide the bulk of annual revenue. Regardless of who sells, leads must be tightly managed for a maximum close rate.
In the spring of '09, landscape contractors used various sales strategies. Some pushed for an absolute maximum of new sales and used every trick in the book to close. Quoting one sales manager: "Once I have them on the phone, they don't get off until they're my customer." His meaning was clear: He'd do whatever it took to make the sale. But would the sale result in a profit, or would the pressured customer, succumbing to a great deal, cancel mid-season?
For a rep on the phone compensated only to close sales, it won't matter. If, however, a business depends on keeping customers for three, four or more seasons, the sales conversation is important.
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