Prospecting is one of the key areas of growing a business. In ways, it’s like fishing. Every industry offers an ocean of opportunities. Prospecting gives you an idea of where the most fishes are located in the ocean. You will know where to cast your net. What if most of the fish in your net is not edible or does not fetch a good market price? This is where prioritising prospects come in. By learning how to prioritise prospects, your efforts to convert interest to sales will yield higher ROI.
It is important to judiciously manage your Prospecting List. You cannot afford to waste or “burn” them by making rash decisions. Knowing how to prioritise prospects will not only help you generate income faster, likewise, it will allow you to manage your budget more efficiently.
Instead of spending money trying to convert difficult prospects, realign more finances to prospects who “warmer” or more certain to buy your products and give you a better return on your efforts.
Capitalise Your Existing/ Current Database of Customers
For the reason that they can do a repeat purchase, the people who comprise your existing database of customers remain prospects. Many businesses make the mistake of putting more resources on new market creation. They forget that existing customers offer them something raw prospects don’t.
This “something” is called trust.
If a customer likes your product or service and enjoyed the experience, chances are he/she will patronise your business again. For sure, the existing customer will no longer have to figure out whether your business is credible or not.
Your product has already spoken on behalf of your reputation. The customer is sold on your business. It is time to sell to him/her again. You can be certain that the probability is very high that the customer will be receptive to your offer.
Thus, prioritise your database of existing customers. When moving them along a sales funnel, you will find them easier to guide than a raw prospect.
Score or Rank the Level of Interest
Let’s assume you own a car dealership. Everyday, car dealerships bring in hundreds of people. Some want to see the latest models, others want to get inspired to work harder to buy the car of their dreams, and there are those who are seriously in the market for a new car.
Prospect “A” walks in your car dealership. He looks around without saying anything. Your salesperson approaches him and offers assistance. He says, “How much does the Model Z cost?” After he gets the reply, he says, “Thank you” and heads out the door.
Prospect “B” comes in and immediately seeks out a salesperson for assistance. She has a list of questions that include pricing, financing plans, availability, delivery schedule, warranties, and spare parts. She gives the salesperson a calling card and reminds him to give her a call as soon as possible.
Which prospect would you prioritise: “A” or “B”?
From the outset, it would seem that “B” is the easy choice. To be more certain, come up with a scoring or ranking system to assess the level of interest.
In our previous example, the scoring system would be:
- Walk in – 1 point
- Acknowledges Assistance – 2 points
- Asks Questions – 1 point for every question
- Provides Information – 3 points
- Requests For A Call Back – 5 points
Based on their respective behaviours, Prospect “A” would be worth 4 points while Prospect “B” would total 17 points.
Ranking your prospects’ level of interest is a good way of gauging their intent to purchase. In our example, the salesperson’s time would best be dedicated to putting together all the information Prospect “B” has requested.
Measure ROI of Each Segment
Segmenting a Prospecting List is a smart way of identifying your contacts by category. There are many ways you can segment a list.
Let’s assume you are engaged in real estate and have segmented your list into 2 groups: Big Buyers and Small Buyers.
Big Buyers are those who are in the market for high-value but expensive property such as those located in Sydney and Melbourne. Small Buyers are those who are looking to invest in properties located in slow growth areas where prices are more affordable like Tasmania.
As a Realtor, it may be better to prioritise prospects who are Big Buyers over the Small Buyers. Because demand is higher in growth areas, the realtor can make a sale faster. However, the trade-off is that the commissions are lower by 1%.
Still, you can generate a faster ROI on your efforts selling property in Sydney compared to selling property in Tasmania. In real estate, areas of slow growth and low demand will take a long time to sell, sometimes 4-5 months.
Consider the Profitability Of Your Target Prospects
It is well within reason to identify a restaurant dealing with long queues on a daily basis as “profitable”. What we don’t know is the restaurant’s profit margins. What is their food cost? How are they affected by rising inflation rates? How much do they lose to wastage and pilferage?
Profitability is a factor of 2 variables: revenues and costs. It is easy to focus only on the revenue side. We can get blinded by all the zeroes that come after the first comma. The reality is, companies need to spend in order to generate revenues.
The company you are targeting may have had a record-breaking year in terms of revenues. But how much did they spend to attain it? What was their marketing cost? How many high-level, top managers did they put on payroll to get the company moving?
If the company you are targeting is besieged in debt or illiquid, it may not be a desirable candidate. You have to assess the company’s level of profitability. After all, the higher the probability the higher is the level of disposable or investible income.
Identify the Most Profitable Segments or Growth Areas For Your Business
If you opened a new gym, where would you align most of your selling resources?
- Companies within a 5km radius that are known advocates of a health and fitness lifestyle and are actively looking for gym memberships for their managers and staff.
- Stay-at-home moms who have little to do once the kids are off to school.
Of course, both segments are potential markets for sales. However, while you can sell 1 membership to a stay-at-home mom, you can sell 100 memberships by focusing on a corporate account.
Given that you have a limited number of hours to work in a day, it is always a good idea to dedicate your time to endeavours which promise a better return on your effort.
Conclusion – Your Prospecting List Is A Valuable Asset
Building a Prospecting List is not easy. You put in time, effort, and a considerable amount of money to build a list of contacts that have been qualified as potential buyers or end-users of your business’ products or services.
A Prospecting List isn’t just a summary of random names, contact numbers, and addresses. These are people who in their own way have shown a measure of interest on what your business has to offer. The strategies and techniques used to gauge the level of interest may vary.
For example, a Prospecting List may be composed of people who have engaged your business in any of the following ways:
- Visited your physical location; left a calling card or talked with the manager on duty.
- Visited your website; signed up to be part of the newsletter mailing list.
- Followed your social media pages.
- Connected with you on social media.
- Connected with you during a networking event.
- Referred by a contact and confirmed interest via outbound channels or through email.
- Existing customer; personal information is in your CRM or Customer Relationship Management database.
The people who comprise your Prospecting List already know about you and your business. This is why your Prospecting List is a valuable asset. As a summary of qualified leads, it reduces the conversion time from intent to paying customer.