Advice for Pitching New Business
If you’re a digital agency or freelancer, you’re continually pitching new business. And there are tons of valuable tips that you’ll hear from a lot of people. You’ll hear advice like:
Have a unique value proposition. If you’re pitching website development like everyone else, it’s hard to differentiate yourself. So you’ll hear people talk to you about doing the hard work of finding what makes you unique. This is valuable advice and you should do it.
Make sure you understand what you’re good at. Another piece of advice you hear is that in order to find the right customer, you need to start with understanding who you’re right for. And that means you have to know what you do, and what you’re good at. Again, this is critical stuff you definitely need to do.
Know who your target is. Once you know what you’re good at, and what your unique value prop is, it makes logical sense to narrow your focus so that your messaging is tailored to your prospects. Knowing your target is a no-brainer, so don’t skip this step.
Be realistic with your prospecting list. I know freelancers or agencies who feel sure that they’re ready to pitch Apple, IBM, or some other large enterprise, before they’ve demonstrated an ability to work with large enterprises. So for sure, you should be realistic with your prospecting list.
Practice your pitch. Not the last of the advice you’ll hear is the need to practice your pitch. Prepare your presentation. Prepare your material and slides, along with the story you’re telling. As a story guy myself, I can’t ever state how important practice is.
All of these tips are practical and useful. So I don’t want to take anything away from the folks that have given you these tips. But today I want to talk about the meeting itself. The moment when you’re sitting in front of someone and getting ready to pitch your case, to explain why you’re a good fit for them.
The Normal Discussion
When you get into a discussion about new business, if you’re like most of the people I know, the conversation normally exists in an exhange of 7 parts.
You ask the client to tell you about their situation
You tell the client about your skills & experience
The client asks you specifics about their specific challenge
You share some historical projects that help flesh out your experience
They ask about your capacity, timelines and maybe even pricing
You share your capacity, eagerness & either skip or anchor on pricing
You both talk about next steps
I’m not saying this is the only way to have this meeting. I’m simply saying this is, with some small substitutions, what I’ve seen and experienced over the years. If it matches your experience, we can move on.
What you notice happening is that you’re both trying to better understand each other and determine if there’s a good fit. It’s a perfectly valid approach and one that works for a lot of people. It works so much that no one asks if there’s a missing question that was never asked.
The challenge when using a structure like the one above, is that you don’t know what you don’t know. And because of that, the most common dynamic when you’re back at home or back at your office is that you spend a lot of extra time and energy trying to figure out what you should charge.
If you lack a deep understanding of value for the prospect, you’ll struggle with value-based pricing. And as a result, you’ll often punt to time & materials, the most common way people price projects.
Now, if you’re using a time & materials approach, and everyone else is too, then the reality is you’re likely going to win a bid based on how much you missed in your evaluation (leading to a lower price for less estimated work).
Alternatively, if the client likes you, but is anchored by someone else’s low bid, you’ll be fighting for every change order to get your margin.
I’m using sweeping generalizations here, so I know you’ll comment on all the nuance I missed. But work with me here, I’m simply trying to make sure we’re on the same page. Things would be easier if you had a better grasp on the value of the work you were pursuing – from a customer’s perspective rather than your own.
The Big Question to Ask
This brings us to the question I almost never hear asked, the one I never hear discussed, and the one I never read about in articles on pitching for new business. It’s the one I most ascribe to helping me understand the value from a customer perspective. And no, it’s not, “What is your budget?” which I really like and find very useful. This is a different question.
How have you tried to solve this already? | How are you solving it today?
Those are two forms of the same question, which is asking, in essence, “how much are you spending or have you already spent to work on this issue?” And that goes to the heart of the value from their perspective.
I’m not lying when I tell you that I’ve been toying in my head with a quote around $20,000 for some custom work, when the client begins walking me thru what they’re currently spending on solving the problem today.
As I better understand the challenge, the nuances, the other players involved, one dynamic that immediately changes is that I have a better grasp of the situation than before I asked the question. The other dynamic is I have a much better sense on the project’s importance, context, and value.
And that has let me push my number up 2,3 and even 5 times higher.
All because of a simple question that you may not have been asking. I hope it works for you and brings you the value it’s brought to me.