One of the key qualities of a good credit manager is persistence. However, persistence is a rare quality in business today. Despite difficult economic times, a number of businesses are not making the most of the opportunities presented to them.
Following up is one of the most important things you can do to collect your money. Not every customer will pay you by the due date. Again, not everyone will pay you after the first reminder. However, if you are ignored after the first reminder, it would be folly to not contact this customer again. Obviously, you would contact this customer until the account was paid. If it was not going to be paid, you then have to choose between writing off the account or taking legal action. In other words, you want a definite answer. Either, yes the account will be paid or no, the account is not going to be paid.
This same persistent approach is rarely used in marketing. If you have got good leads, you need to make the most of them. Your marketing approach should seek to get an answer, i.e. yes, we will buy from you or no we won’t. If your leads are good enough, you do not want to die wondering. In other words, seek an answer from your customers and prospects on whether or not they will be placing an order.
However, followup marketing is rarely used and when it is, it is ineffective. The only excuse for not following up is that your business is so successful and you have too many people wanting to buy your products and services that you just can’t possibly continue to market your products and services to these people as you simply do not have the resources to do so.
If this is you, well congratulations. For the rest of us, it is vital we followup. This is rarely done for two reasons. One is sheer laziness. Secondly, too many businesses cast their net far too wide. They are trying to be too many things to too many people. Instead of following up on their best customers and prospects, instead they use their time and money to market once to a larger group of prospects.
It is important to increase your sales by getting more customers but too many businesses give this a higher priority than following up on their best prospects and customers. This results in higher marketing costs and lower profits. Instead, it is better to put more of your efforts into getting the “easier” sales rather than searching for too many elusive new customers.
The easiest sales to get are sales from previous customers. However, getting repeat sales should not be considered automatic. You still need to market to your current customers and you should do this frequently as this group is ready and willing to buy from you.
For my business, one of our most popular products is our corporate Christmas cards. There is a lot more to getting a repeat sale than just putting our products on our website and mailing a Christmas Catalogue. Instead, we have a marketing plan that is consistent, involves multiple media and multiple contacts. We use special offers by mail, email broadcasts, fax broadcasts and the telephone. We continue to market to our customers until we get a yes or no from them.
This is simply what good credit managers do. They must know if the account is going to be paid. Why not adopt this attitude with your best customers? Make an effort to find out whether or not your customers will be ordering. To get a definite answer you need to get a response from your customers. This is where the more expensive forms of marketing, i.e. the telephone and calling on your customers in person are important. You simply need to know. Do not let potential sales get away.
Apart from your current customers, the next best group of prospects are those that have contacted your business for free information or a quotation. These people are almost ready to buy from you. Yet it is common practice of many businesses to ignore these hot prospects once the information is provided. For these prospects, you should use the same approach as you do with your current customers. Make special offers, use multiple media and aim to get a definite yes or no answer from these prospects.
If the answer is no, then all is not lost. In fact, use the answer “no” as an opportunity. Ask why you missed out on the sale. Some will say it is price but many will not. A lot less people than you think buy on price. For those that have based their decision on price, do not be tempted to reduce your prices. It is rarely a profitable strategy to seek higher sales volumes at lower margins.
After examining the feedback, then you are in a position to modify your offer and then continue to market your products and services to these prospects in the future. Treat a “no” as “not yet”. If some prospects have bought from your competitors, then continue to market your products and services to these prospects. Be patient. You may not get an immediate sale but you have a group of prospects that are interested in what you have to offer. Pursue them and keep following up.