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11 years ago

Everyone has a comfort level.

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DaniMc 11 years ago

Originally Posted by Claude Whitacre

Everyone has a comfort level.

So true. It's like a thermostat - each person has a range of income where they are comfortable.

If someones financial thermostat is low...a high income will be uncomfortable to them.

The trick is to keep raising it. I know people who freak out if they make less than a few million per year. They start getting nervous and shaky and start making things happen.

I hang out with those people as much as possible.
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- kemdev 11 years ago
  
  I think there's a comfort level for a reason. Today's experience taught me that.
  
  It's easy to say you want to target affluent business owners. Lawyers, dentists, real estate brokers. Big game. But saying isn't doing.
  
  From someone who's sold mostly to contractors, start-ups, restaurants, galleries, and car dealerships... I stepped into one of those 'affluent' businesses today for a meeting. Only the largest firm in my city, no big deal.
  
  Sat in the waiting room and read Reader's Digest, went into the meeting room, sat down with three serious business professionals on a big oak table with those really nice leather chairs that swivel. Trust me, it's a very different feeling from pitching an HVAC guy at your local coffee shop.
  
  I've sold 25+ sites/packages, so I'm by no means 'new' to this. But man it's a different game when you get on that level, and I wasn't ready for it. So yeah... advice is advice is advice from some guy typing a WSO behind his computer screen. But saying isn't doing, and there's another level of "preparedness" both in sales training and packaging/presentation that you need to have before tackling the bigger gorillas.
  
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Aaron Doud

11 years ago

Also the rich know that you make money providing products and services to the masses. Not by selling to the rich.

If you want to scale and own a business vs, your business being a job. Well I think you get it.

The argument goes both ways and depends on how you want to grow the business.

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misterme

11 years ago

Originally Posted by James Foster

We all know we should be focusing on getting affluent clients. They're willing to pay for a higher quality service and they're less concerned about price.

It's more like they're able to pay for a higher quality service.

Having deep pockets doesn't mean they're willing to dispense monies out of them.

Originally Posted by kemdev

I think there's a comfort level for a reason. Today's experience taught me that.

It's easy to say you want to target affluent business owners. Lawyers, dentists, real estate brokers. Big game. But saying isn't doing.

From someone who's sold mostly to contractors, start-ups, restaurants, galleries, and car dealerships... I stepped into one of those 'affluent' businesses today for a meeting. Only the largest firm in my city, no big deal.

Sat in the waiting room and read Reader's Digest, went into the meeting room, sat down with three serious business professionals on a big oak table with those really nice leather chairs that swivel. Trust me, it's a very different feeling from pitching an HVAC guy at your local coffee shop.

I've sold 25+ sites/packages, so I'm by no means 'new' to this. But man it's a different game when you get on that level, and I wasn't ready for it. So yeah... advice is advice is advice from some guy typing a WSO behind his computer screen. But saying isn't doing, and there's another level of "preparedness" both in sales training and packaging/presentation that you need to have before tackling the bigger gorillas.

Maybe you should check out Oren Klaff's "Pitch Anything"?

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Aaron Doud

11 years ago

Originally Posted by misterme

It's more like they're able to pay for a higher quality service.

Having deep pockets doesn't mean they're willing to dispense monies out of them.

This is the thing I think people forget. Just because someone has a lot of money doesn't mean they will spend a lot of money.

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James Foster

11 years ago

Originally Posted by Aaron Doud

This is the thing I think people forget. Just because someone has a lot of money doesn't mean they will spend a lot of money.

That's kind of a self limiting belief isn't it?

Yes there are people who have money that are total penny pinchers.... but there are also lots of affluent business owners who spend like crazy.

Rodeo Drive in Beverly Hills is living proof of that.

No one needs a $12,000 purse or a $90,000 jacket... but people buy them.

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Aaron Doud

11 years ago

Originally Posted by James Foster

That's kind of a self limiting belief isn't it?

Yes there are people who have money that are total penny pinchers.... but there are also lots of affluent business owners who spend like crazy.

Rodeo Drive in Beverly Hills is living proof of that.

No one needs a $12,000 purse or a $90,000 jacket... but people buy them.

Well if I wanted to sell a $12k purse or $90k jacket clearly I couldn't sell that to the poor or middle class.

It's not self limiting. It is just much more likely that someone with a lot of money will spend it smartly. Now that doesn't mean they won't spend it. It simply means they will spend it relatively smarter. Luxury good exist because people buy them. So they will buy but the product must be worth their dollars.

But assuming you will make more selling to rich people is limiting. At least it is in my opinion. And it goes against how the people who are actually rich make their money.

It's fun selling to the rich but they know it is smarter to sell to the masses.

The more mass appeal a product has the more it will sell and the more scalable the business built around it will be.

Now you don't have to be cheap to sell to the masses. Apple isn't cheap.

You don't have to target the poor to sell to the masses. Few products do as the poor will go into debt to buy what the rich and middle class can just buy.

You can even sell to the middle class masses by pretending to target the rich. BMW anyone? How about Coach? Hell even Lamborghini made a more mass appeal car and the Gallardo is the best selling most profitable car they ever made. There are many "affordable" luxury brands out there.

If you want to be a "one man show" consultant than by all means do it. But even Alan Weiss (read Million Dollar Consulting) teaches that you have to grow into that. And do you truly think he makes more than someone like Tony Robbins? And while Tony may like to promote all the work he does with the rich and the famous, we all know (I hope at least) that his real money comes from marketing to the masses.

I can tell you one thing right now. Not a single one of us here isn't rich because we choose to market the masses vs. the rich. Who we target is not the issue at all. In fact those here, who seem to be the most well off, target the masses. They have spoken about it in great length.

Being big isn't about targeting bigger businesses and richer clients. To truly be big you have to target the masses and scale - scale - scale.

Claude is right on one of the points I was making. You can't sell the same thing to someone for more just because they have more money. Which is often promoted here. They will expect more for their dollar. And if you can sell the same product for service for more money that only means you were under pricing it before. Has noting to do with who you targeted.

If the rich is the demographic you choose to serve that is fine with me. In fact depending on what you sell that may be the smartest plan. I'm in no way saying it is the wrong idea for you. In fact it sounds like it is the perfect plan for you. But that doesn't mean it is the smartest plan for everyone. And for most people, especially those who truly want to make it big, the better plan is to target the masses.

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James Foster

11 years ago

Originally Posted by Aaron Doud

Well if I wanted to sell a $12k purse or $90k jacket clearly I couldn't sell that to the poor or middle class.

It's not self limiting. It is just much more likely that someone with a lot of money will spend it smartly. Now that doesn't mean they won't spend it. It simply means they will spend it relatively smarter. Luxury good exist because people buy them. So they will buy but the product must be worth their dollars.

But assuming you will make more selling to rich people is limiting. At least it is in my opinion. And it goes against how the people who are actually rich make their money.

It's fun selling to the rich but they know it is smarter to sell to the masses.

The more mass appeal a product has the more it will sell and the more scalable the business built around it will be.

Now you don't have to be cheap to sell to the masses. Apple isn't cheap.

You don't have to target the poor to sell to the masses. Few products do as the poor will go into debt to buy what the rich and middle class can just buy.

You can even sell to the middle class masses by pretending to target the rich. BMW anyone? How about Coach? Hell even Lamborghini made a more mass appeal car and the Gallardo is the best selling most profitable car they ever made. There are many "affordable" luxury brands out there.

If you want to be a "one man show" consultant than by all means do it. But even Alan Weiss (read Million Dollar Consulting) teaches that you have to grow into that. And do you truly think he makes more than someone like Tony Robbins? And while Tony may like to promote all the work he does with the rich and the famous, we all know (I hope at least) that his real money comes from marketing to the masses.

I can tell you one thing right now. Not a single one of us here isn't rich because we choose to market the masses vs. the rich. Who we target is not the issue at all. In fact those here, who seem to be the most well off, target the masses. They have spoken about it in great length.

Being big isn't about targeting bigger businesses and richer clients. To truly be big you have to target the masses and scale - scale - scale.

Claude is right on one of the points I was making. You can't sell the same thing to someone for more just because they have more money. Which is often promoted here. They will expect more for their dollar. And if you can sell the same product for service for more money that only means you were under pricing it before. Has noting to do with who you targeted.

If the rich is the demographic you choose to serve that is fine with me. In fact depending on what you sell that may be the smartest plan. I'm in no way saying it is the wrong idea for you. In fact it sounds like it is the perfect plan for you. But that doesn't mean it is the smartest plan for everyone. And for most people, especially those who truly want to make it big, the better plan is to target the masses.

Aaron, we're starting to talk about different things here.

I wasn't talking about being big, at all.

I'm perfectly happy being a one man shop.

And as such, I don't want to sell to the masses because I don't want to (and can't) handle hundreds or thousands of customers.

That's why I target the affluent. Because I'd much rather have just a handful of great clients who can pay me the exorbitant amount of money that I feel I'm worth

And I think a lot of consultants fee the same way I do, but they stick with clients who don't pay them much because it's what they're use to.

That's what this thread is really about.

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James Foster

11 years ago

So what it sounds like it comes down to is that a lot of people don't feel like they're good enough to sell to affluent people.

That's really what's being said when someone says it's out of their comfort zone, right?

I know plenty of incredibly wealthy people that are dumb as door knobs. One of them were simply told they were going into the family business (when they were young), and when their parent passed away they were suddenly left holding the bag and they're now driving this big fancy company into the ground.

I know plenty of incredibly wealthy people who are smart, but don't know what I know.
They know how to produce a great product, and because of that have/had customers, but someone else comes a long with a better value proposition and all the sudden they're losing customers and don't know how to get new ones (the old ones knocked down there door to get in).

So if you feel intimidated by wealthy people, look at them closely... They're really no different than you or me.

And you can sell them, just like anyone else.

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Claude Whitacre

11 years ago

Originally Posted by James Foster

So what it sounds like it comes down to is that a lot of people don't feel like they're good enough to sell to affluent people.

That's really what's being said when someone says it's out of their comfort zone, right?

James; I can't speak for anyone else. My comfort level isn't income based.
It isn't even socio-demographically based (Is that a word?)

I don't like committees. I don't like kowtowing. I don't like dealing with multiple meetings..and I won't submit proposals.

Many of my friends are CEOs of smaller businesses. Some have lavish offices.
Most, like me, have very nice homes in the better neighborhoods. But some very wealthy people live in the home they grew up in...and could afford to buy another one every month.

I'm never intimidated by any of it. But I'm not comfortable being talked to like an employee. I'm not patient with internal business hierarchy. I see business politics as a weakness.

Start talking to me about your three homes, your trip to Aspen, your golf game..and I turn off...and can't wait to get back to business.

Maybe what Aaron was saying, and certainly what I'm saying, is that I wouldn't charge more depending on the wealth of the client. And their wealth doesn't determine what I show them.

Anyway, smart thread...and you seem to know your stuff.

Added a little later; As far as the businesses I pitch. I like talking to the owner. I identify with them, and know how they think. The only businesses (other than niche) that I stay away from are ones that need someone to "save" them. I'm not in the "saving" business. Other than that, I like talking to smart owners. It takes less time to sell them, and they are more fun o talk to.

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James Foster

11 years ago

Originally Posted by Claude Whitacre

James; I can't speak for anyone else. My comfort level isn't income based.
It isn't even socio-demographically based (Is that a word?)

I don't like committees. I don't like kowtowing. I don't like dealing with multiple meetings..and I won't submit proposals.

Many of my friends are CEOs of smaller businesses. Some have lavish offices.
Most, like me, have very nice homes in the better neighborhoods. But some very wealthy people live in the home they grew up in...and could afford to buy another one every month.

I'm never intimidated by any of it. But I'm not comfortable being talked to like an employee. I'm not patient with internal business hierarchy. I see business politics as a weakness.

Start talking to me about your three homes, your trip to Aspen, your golf game..and I turn off...and can't wait to get back to business.

Maybe what Aaron was saying, and certainly what I'm saying, is that I wouldn't charge more depending on the wealth of the client. And their wealth doesn't determine what I show them.

Anyway, smart thread...and you seem to know your stuff.

Added a little later; As far as the businesses I pitch. I like talking to the owner. I identify with them, and know how they think. The only businesses (other than niche) that I stay away from are ones that need someone to "save" them. I'm not in the "saving" business. Other than that, I like talking to smart owners. It takes less time to sell them, and they are more fun o talk to.

And that's a perfectly good reason Claude. And I wish you all the best.

You have a great reason to why you deal with who you deal with. I'm not trying to challenge that (or you).

The reason I started the thread was to challenge the people who don't have a reason not to target the affluent. (I don't consider "because I haven't done it before" a reason.)

Or people who don't do it because they think people with more money are smarter or better than they are.... because that's not true at all.

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AndrewCavanagh

11 years ago

Originally Posted by Claude Whitacre

I don't like committees. I don't like kowtowing. I don't like dealing with multiple meetings..and I won't submit proposals.

Many of my friends are CEOs of smaller businesses. Some have lavish offices.
Most, like me, have very nice homes in the better neighborhoods. But some very wealthy people live in the home they grew up in...and could afford to buy another one every month.

I'm never intimidated by any of it. But I'm not comfortable being talked to like an employee. I'm not patient with internal business hierarchy. I see business politics as a weakness.

Start talking to me about your three homes, your trip to Aspen, your golf game..and I turn off...and can't wait to get back to business.

I hear you there.

Strangely enough I've sat with people who have wealth in the hundreds
of millions and that kind of conversation (trips to Aspen etc) never came up.

Talking about broader socio-economic issues is a common theme.

Like how their company in an area may be employing people at low
wages but how badly off that area would be if they had no one to
employ them.

Personally I like talking to the owners of small to mid sized businesses
because it's so easy to come up with an idea and just get it rolling
then and there.

Larger businesses can be so slow to change direction.

Kindest regards,
Andrew Cavanagh

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DaniMc 11 years ago

Originally Posted by Claude Whitacre

I don't like committees. I don't like kowtowing. I don't like dealing with multiple meetings..and I won't submit proposals.

Even that in itself can be a strong positioning and selling point.

I was getting pulled into a process like that once. They wanted a pitch. They wanted a formal proposal. They were playing all these "Alpha Games" lining up providers.

I showed up for an appointment and there were several other people there. Literally, right in the middle of the cattle call, I said "I wish you guys the best - this isn't my ball of wax." And I got up and left.

Guess who got called back? Guess who got the contract? There were no problems with price, arguing over process, or people telling me how to do the job. It was clear that I was in charge of the project - not them.

Of course, I was polite and professional. And they treated me like a professional, not just some other vendor that they could order around. If you make it clear that you will not be jumping through their hoops and doing the dog and pony show, you earn much more respect.
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Climb Online

11 years ago

Very few start at the top, one has to put the time in. Start doing the small deals, $200 or even $100 per month, learn the business by doing rather than reading. Small deals are not a dirty word, they are essential stepping stones.

A pro athlete does not just land at the top level, they start out in little league.

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James Foster

11 years ago

Originally Posted by susie haynes

Very few start at the top, one has to put the time in. Start doing the small deals, $200 or even $100 per month, learn the business by doing rather than reading. Small deals are not a dirty word, they are essential stepping stones.

A pro athlete does not just land at the top level, they start out in little league.

I'd agree with that, and I'm not saying you should read an Offline WSO and start targeting the affluent right out of the gate (although it can work).

But I think too many people stay small too long.

Yes, doing small deals to learn the business is fine...

I target a specific part of the finance industry, and I didn't go after affluent clients right away. Like you said, I needed to understand the industry.

But it only took you 2 or 3 clients and small deals to understand the needs and wants of the industry. You didn't have to spend 5 years or have 50 clients to know what the high earning producers in your industry need.

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iAmNameLess

11 years ago

I suppose it all depends on the goals you set for yourself.

Work from home consultants vs. building a business, two entirely different things with different goals.

So, that being said...

If I were to have the option to buy both at the same price, I would buy both.

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vndnbrgj

11 years ago

I agree with Nameless.
I would buy both lists.

The $500k businesses would get a smaller deal that will help them get closer to the million.
The million + would get my higher priced more involved deals.

I don't care how much money as business has.
There is a place in my funnel for all of them.

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ewenmack 11 years ago

In my paper receipt roll business,
the company size isn't the factor which is more valuable to me,
it's their usage. I have no control over that.

Example from my customers:
Dental chain of 75 offices
has a a fraction of usage compared to the
chain of 13 porn shops.

I wouldn't buy, rent or collect a mailing list in this business either.

Fastest and easiest way is to pick up the phone and talk
with the decision maker in these household name companies I deal with.

Best,
Ewen
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Writerdave

11 years ago

The product you offer is far more important than who you are selling to

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Sciencemies

11 years ago

Aiming for bigger clients who have more money is all fine and dandy, but if you are a one man show, it's pretty hard. Yes, big companies spend more money to digital marketing, including the websites. Heck, you can even loose them by quoting too little, but they also like to do business with other companies. Not freelancers or "consultants", who outsource everything to Philippines or India.

Now, I am a freelancer and I have to balance a fine line with my pricing. I am competing with masses of other freelancers, who may have greater credentials and portfolios. They can't do all the work of course, but they'll take the best deals. Unless you already know somebody. Then I compete with the Indian and Philippine designers. I also compete with relatives "who know how to code" or "have taken some courses on web design".

And no, I am not offering just web design, but that is what most clients want. If I drop my prices, I'll compete with huge corporations with nationwide exposure on TV, web, magazines, etc. who sell responsive, search engine optimized websites for 10€/month. If I up the prices, I'll compete with advertising agencies and other big digital agencies, who have the inhouse staff and big connections.

To clarify, I'm not a freelancer per se, since I invoice my clients though a company. This brings me to a question. Don't you guys in the States have to start up a company to offer your services? I'm asking since here's a lot of people saying "just use Paypal to invoice" and rarely someone mentions the expenses and taxes in the pricing. It's like, if you charge $500, that's what you make, when in reality you'll get about half of that (depending on the country you live in).

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