60% of prospecting success is due to one thing.
Getting it right forever takes 3 hours.
Do this… work in the highest productivity zone.
Don’t do this… keep banging your head against the wall.
Why calling from a Chamber of Commerce list is death. Why calling from a book of lists is death. Why great scripts don’t help you if you get this wrong.
Would like to relate to you a recent project with the actual numbers to demonstrate the importance of the 60/30/10 rule. In particular, what the 60 is and how getting that right takes so little time and can immediately flop you from the frustration/low productivity zone to the highest productivity zone.
60% of prospecting success is due simply to calling the right people. Your list.
30% of prospecting success is due to your message. Scripts, responses, ancillary material. 10% is due to everything else.
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Get the 60% wrong and you cannot succeed, no matter how well you work the other components. Get the 60% right and you can make some major screw-ups on the other components and still make money.
Typically, people focus on having a “great script” then start calling some general generic list or talking to anybody with a pulse then wonder why this prospecting thing isn’t working. That is guaranteed prospecting death because easily 70% to 90% of your prospecting time is focused on people that never should have been called in the first place. No exaggeration, I see it quite a bit.
Here is an example. Real numbers.
Mature mid-sized firm doing well wants higher growth rate than their referrals and networking is bringing them. Had prospected before with some success but never really focused on it or worked a complete system.
Here is what we do to get the 60% right.
They give me a list of their clients for the past three years.
We obviously want to clone the good accounts, so I research every company that has generated fees in excess of $20,000 on a business list database I subscribe to. For each of those companies I note their SIC code (every industry has an SIC code,) revenue range and employee range and create a simple chart by hand. Found about 60 companies and there were 20/30 more I couldn’t immediately find in the database.
Here is what is immediately obvious.
The vast majority of great accounts, the ones we want to clone, are found in just two SIC code ranges.
The vast majority of great accounts had at least $1 million in revenue.
Most of the really great accounts had $2.5+ million in revenue.
The next step? Find out how many companies there are in their geographical target area. All businesses. 42,750. All businesses with $1+ million in revenue. 11, 789
Now, how many businesses are there consistent with the great account profile? Those that are within the two dominant SIC code ranges with $1+ million in revenue.
Businesses within dominant sic code ranges with $2.5+ million revenue. 1,229
Business within dominant sic code ranges with between $1-$2.5 million in revenue. 1,858
What is important here for you to understand?
If this company had called from Chamber of Commerce lists or other generic lists 92% of their calling effort would have fallen outside of their high probability zone as only 8% of all companies are consistent with their best target profile.
Now, due to a one time investment of three hours doing some research 100% of their prospecting effort is to high probability prospects. None of their time is being invested with low probability targets.
To those of you saying “Wait a minute. I don’t want to miss anyone. I’ve gotten some great accounts that don’t fit my best account profile,” you are saying a very dumb thing. The goal is never to “not miss anyone.” The goal is always to get the greatest return on your prospecting time. Why would you call low probability suspects when there are more than 3,000 high probability suspects waiting for your call?
In this case, the 3,087 companies that fit the best account profile are enough to keep everyone busy for more than a year. A solid year or more of calling companies that look just like your best most profitable clients, not a bad thing.
And all due to just three hours of research time. Prior to this the salespeople told me that they go out to meet a lot of companies that aren’t a great fit for them or would buy in volumes not worth the prospecting and sales time. That is what happens when you don’t get the 60% right.
This is why great scripts can’t help you if don’t get the 60% right. You end up going to see prospects that are not a match or typically won’t buy much.
If you have just one person prospecting for 20 hours a week and you don’t have the 60% right, calculate how much money in wages, overhead and salespeople time is being invested in low probability prospects every week.
Best wishes for great selling,