Win Clients by Leading, Not Following

0:08Hello and welcome to another episode of the duct tape marketing podcast. This is John Chance. My guest today is Blair Enns. He's a leading voice in the creative and consulting agency world, best known as the founder of Win Without Pitching. Over two decades, he's helped thousands of agencies move from pitching and price haggling to confidently leading client engagements and charging for their expertise. We're going to talk about his latest book, The Four Conversations, A New Model for Selling Expertise. Book distills decades of hard-won wisdom into a practical roadmap for navigating the most crucial moments in every client relationship.

0:46So Blair, welcome to the show. Thank you, John. So let's get some leverage. What do you think the real cost, day to day, when agencies let clients run the show instead of leading the conversation? What's the real cost of letting clients run the conversation? Yeah. I mean, instead of us, a lot about the four conversations is really providing leadership in the conversation. So I see a lot of agencies that show up and say, what do you need? Sure, we do that. And I think that's what really leads to this price haggling, doesn't it? Yeah. So if I start to, I've never contemplated the total cost here, but we could do some math on the fly.

1:25Yeah. The typical agency has a closing ratio of about 25%. I can actually be more specific than that. It's oddly specific at 26%, which seems to be a universal number across all B2B sales. Now that's when we measure it. It's 26%. Self-declared, it's closer to 33%. So an agency will tell you, we close one in three proposals. When we crack open their CRM and look at it, they close one in four. I think the threshold of respectability and a closing ratio is 40%. You should strive to be over 50%. So if you're closing less than 50%, A, you're probably writing too many proposals. B, you're probably doing something wrong in the proposals.

2:03So let's say you're closing half as many proposals as you should. So there's a starting point. And then there's pricing. Are you commanding your fair share of the value that you're helping to create? And the typical agency is not. I can't give you a percentage on that, but I would guess it's another 20 % across the board. A typical agency could probably increase their prices by 20%. Now, with existing clients, not necessarily. They can raise prices with existing clients on average. It's difficult with larger agencies. We're dealing with procurement. But if you draw a line in time, this is after today, after you've absorbed this information, you start to sell this way, your average proposal value should climb by 20 % easily.

2:55So take the size of your firm, add 20 % to the top line, double your closing ratio. That's the cost of poor selling. Yeah. So how much of that, I might leave myself right into a trap here. How much of that is marketing and how much of that is sales? So in other words, you and I have written books that comes with, in some cases, perceived trust and perceived authority, expect to pay a premium in a lot of cases. So how much of that is done on the front end and how much of that is done in the sales conversation? Well, most of what I just talked about is what happens in the sales conversation, which to me is after the initial interaction.

3:33So if we're talking about marketing is to generate leads, that's a whole other ball of wax. Now, depending on who you are in the organization, how it thinks about sales and marketing in some organizations, some agencies, lead generation can be seen as a sales function. And in others, it's seen as a marketing function. Typically, it's seen as a bit of both or a specific combination of both in the average firm. The better you are at marketing goes the saying, the less selling you have to do. But that's an interpretation of that statement. It's really about seeing that statement views selling as lead generation, but there's all this stuff that I just referenced, which is what happens after you begin the conversation with the lead.

4:18So there's a whole other area of improvement to be had under the banner of marketing. Yeah, and it's probably the combination just amplifies everything, right? The combination of both of those being effective amplifies everything. So let's just go right to the title of the book. what are the four conversations and why do they keep happening no matter how seasoned somebody is? Yeah. So the four conversations, this is a model. A model is a view of the world, a way of organizing complexity. All models are wrong. Some are useful. The book opens with that quote. So I'm not saying the sale always happens in a series of four linear and discrete conversations, but it is helpful to think of it that way.

4:58So the four conversations and their objective are the probative conversation where your goal is to prove your expertise to the client and move in their mind from a position of a vendor to the expert. That's the conversation that happens without you present. Your marketing would be under the domain of the probative conversation. It's a conversation in construct only. It happens through your agents of thought leadership, referral, referrers, and your marketing. And then you have the three person to person conversation that happen after that, which you would think of as the sales conversations. there's the qualifying conversation which is the vetting conversation you're vetting the lead to see if this is something worth spending your time on there's the value conversation where you're uncovering the value to be created and the share of that value you might command in the form of fees so you're starting to set not price but pricing guidance rough approximate pricing guidance based on the value to be created rather than the cost of your solutions And then the final conversation is the closing conversation where you help the client commit and select and commit to a path forward.

6:03You know what I love about as I listen, you talk about all four of those conversations. They're not about like manipulating or getting this thing that you want done. They're really about creating value for both parties, right? Yeah. I'm a big believer in the idea that selling is not talking people into things. Right. Right. I think, you know, we make this distinction or we, I make the distinction in the book, you know, between expert and vendor. And you think of your expert self, the way you operate as an expert, you're in your relationships with your clients. So after sale, the way you show up, you're kind of, you're an advisor, you facilitate choice.

6:41You point out the pros and cons of decisions. You give the client some decisions to make, you point out the pros and cons of those decisions. And I think that's how you should navigate the sale as well. I talked to a lot of agencies that I'm sure you've heard this quite often as well. They feel like they're giving away their expertise, pitching for free, giving consultations to show that they know what they're talking about and really all along the way kind of giving it away. How do you get people out of that place being stuck? Well, there's no short answer to the question of how you get people out of that.

7:12You write a book on a model, you get them to read the book and implement the guidance in the book is the short one. But as you point out, it's hard. And myself, I struggle with this a lot. I have for years, it's been the hardest thing for me to go from seeing myself as the person with the answers, the subject matter expert to the person with the questions. So if you think of how a typical marketer shows up in the sale, they want to prove their brilliance. And yeah, we do that in the probative conversation, but that's the conversation that happens without you present. Once you're in a conversation with an individual, instead of trying to prove your brilliance, you should arm yourself with a set of questions.

7:52And so in our model of the four conversations, each conversation has a framework or set of frameworks, has a specific objective, which I shared with you, and then a framework or set of frameworks for navigating to that objective. Now, those frameworks are almost all questions. So the short answer to how is you go from statements about yourself to questions about the client. Well, and those statements often are not just about yourself. They might actually be offering solutions, right? Free advice. Yeah. Yeah. Yeah. Number two, a qualifying. I know that this is not your take on this, but I know a lot of people hear that qualifying and they're thinking it comes off more like, I'm going to see if you qualify to work with me, you know, and it can actually be a little off-putting if not done genuinely.

8:44How do you approach making sure that the client doesn't feel like they're being evaluated? Yeah, I think some people do overplay that idea. So you can take this idea of qualifying and you can put on a spectrum. At one end, there's the client qualifying you. At the other end, there's you qualifying the client. And most of these qualifying conversations, the typical listener wouldn't think of them as a qualifying conversation. They would think of them as a credentials conversation or a credentials meeting. So what does that mean in the, if we put it back into this context of qualifying, it means you're trying to qualify for the client.

9:19The assumption is this is a good fit for you. Now you're trying to prove to them that they're a good fit. And you should, you have to do that. And there's a way to do that, but the conversation is all about you make you first making sure that they are a good fit for you. That implies that you've actually thought about who is a good fit for you. What is your ideal client profile? Who do you want to do business with? Who will you not do business with? How much money do you need somebody to spend? And so you can have a very business-like conversation using a framework to organize questions around that without coming across like an ass or, but you in the wrong hands, somebody can overplay that idea and they can make the client feel uncomfortable.

10:00You know, one of the things over the years that I've liked to use as a qualifier is there are certain behaviors that the client has or what they believe in terms of, you know, what value is and how a solution gets done. And in some cases, we get very good or most people get very good at understanding, oh, this is a problem I can fix well. You know, I know I could do this one. So, you know, where does that come into the qualifying, you know, those types of considerations? Well, you have to guard against that. So qualifying is the vetting conversation. There's a tone in the qualifying conversation.

10:31It's a tone of discernment. So you're professional, you're clinical, you're, if you're getting really enthusiastic about the opportunity, you're just suppressing that for the time being. And then once you ask your questions and you determine that this is a good fit for you, then you move to the next conversation, the value conversation. Your tone of discernment can move to a tone of deep interest. You decide, you ask your questions, you get your answers, and you decide, you know what, this is a good fit. And you would say to the client, on the surface, I think this is a really good fit. I can see my team getting very excited about this.

11:05I'm not saying I'm getting excited about it. I'm still trying to moderate my enthusiasm to make sure my enthusiasm for the project or the client does not exceed their enthusiasm for me. Can we stick on that for a minute? Why is that an issue? Well, I have in the book what I consider to be the first principle of selling expertise. It's a formula P equals DB over D. I printed on the back of coffee mugs. P stands for your power in the sale. Your power in the sale is a function of your desirability, DB, being greater than your own desire, D. Otherwise stated, whoever wants it the most has the least power in the buy-sell relationship.

11:48So you don't extrapolate that to the nth degree and say, therefore, I should seek to maximize my desirability. That's true. That part's true. But you could also infer that to mean I should seek to minimize my expression of desire for the client. And that I don't really, I don't really need this sale. Yeah, no, you show up as aloof, disinterested. You don't want that. I'm just saying, pay attention to the power dynamics in the relationship and make sure, especially early on, actually throughout, there's no, especially early on, but just make sure that your own expression, allow your enthusiasm for the opportunity to rise as high as the clients and try not to exceed it.

12:29Because when you exceed it, you clearly give all your power away, your power to do your best work, to command the most profit, to command high prices. Your cost of sale will go up, too, as your power goes away. Interesting. So let's move to number three, I guess it is. You used the phrase value to be created. Is that right? Value to be created? It's a value conversation. Yeah. But less about fees and more about the value to be created as part of the equation. And so do I hear you saying, oh, what we're going to fix for this client is worth a million dollars. That's the value it's going to create for them.

13:07So do we base our fee on that? Or do we base our fee on the fact that we know how to do this and we do it well and efficiently? So you can base your fee. I'm getting softer on this as the years go by. My previous book, which came out in 2018, is on pricing. It's called Pricing Creativity. And I was probably a bit more of a heart was pushing harder for value based pricing today. I don't really care how you price. I care if you have a value conversation. A value conversation begins the pricing discussion based on the value to be created. So you come to me or your prospective client, and I'm walking you through the simple four-step framework.

13:43What do you want, John? You tell me what your vision of your desired future state is, what success looks like in the future. And I say, this is a great vision. So now I'm leaning in. I'm enthusiastic. Okay, what are the metrics that we'll measure to prove that you've achieved what you want? And we talk about some KPIs, you give them to me or I pull them out of you. And I say to you, okay, what's the, I know what you want. I know what the KPIs are that we'll measure. If we hit these metrics, what's the value of that? So if we just keep it to economic value, you give me some numbers, we top line or revenue gains or cost reductions.

14:17We translate that into profit. And I say, all right, so if your vision comes true, you hit these metrics, we're going to create a million dollars a year in net new profit. Is that right? And you say, yeah, that sounds right. if everything goes well. Now, the fourth and final step is setting pricing guidance. At this point, I haven't thought about what I'm actually going to do. I haven't talked to you about specific solutions. Even if you may have come to me with a specific solution in mind, I put it aside and I've put you into your desired future state. And I've asked you to describe success. And obviously there's a framework around this.

14:49And they say to you, if I could help you create this million dollars a year in that new recurring profit, would you pay me X? and in that moment, I'm going to pull a number out of my nether regions. And I want the number to be so high that you won't pay it, that you walk it down. And there's some psychology, it's called the anchoring effect and why I do this. But at some point, so if I say, would you pay me a half a million dollars? And you respond with, well, that depends. What would you do for a half a million dollars? I might say, I don't know. I haven't thought about solutions yet. But if I could help you create this million dollars in net new recurring profit, would you pay half a million in one-time fees?

15:29And that's whether you say yes or no, we're in a conversation on pricing. And that conversation has started high. The price is tied to the value to be created, is not tied to my solutions. From there, the price can go down. At the end of the day, when I come back with a proposal in the closing conversation, I can price however I want. The important thing is we have started the pricing discussion based on the value to be created, not based on the cost of my solutions. That's certainly the path towards getting a prospect or a client to think I'm investing this money as opposed to I'm spending this money, isn't it?

16:05Correct. So let's talk about the money conversation. I would say that, I mean, you talked to millions of salespeople probably over the years. Isn't that the place that they have the most issue with? I think the value conversation is a pivotal conversation because we are starting to, the client, we uncover a budget if there is one in the qualifying conversation, then we transcend that budget while still acknowledging as part of the framework that the client has a budget and agreeing that we'll come back with a range of solutions and a range of price points. We basically agree on a trade. I'll show you what I can do for your budget.

16:38You allow me to think creatively and expansively about what's the most we can do to help you create this value. And it's going to be a big price. So that's, I love this framework for talking about money. It doesn't make it easy, but when you understand that it's okay for the first number to be so high that the client chokes on it or pushes back and you do this a few times, you realize everybody will survive. This is not an existential threat. This is just part of the conversation. By the time the conversation ends, you're in agreement that the client will consider options in a certain range. Even if the client says, listen, I don't have the authority to spend, let's say I anchored at 500 and we ended up at 250.

17:24And then you said, well, my budget's 50. So I've got a range of 50 to 250. Even if you don't have the authority to spend 250 in that moment, I'll extract from you an understanding that, okay, I'm going to put some options in front of you that are going to be beyond your budget. And if you're really excited about them, it's your prerogative. But then I would invite you to invite the other people to the table who would be required to fund this. So you are always in, you the buyer, you're always in control. You've stated to me that you have a budget. I've shown what I'm going to do for that budget.

17:53In exchange, you're letting me push you to think bigger, to think about investing more. And that's a pretty fair trade. You practice this a few times. It becomes fairly intuitive to you. You know, it's become very commonplace, it seems like, the last few years for agencies to kind of offer package services. So this much deliverable for this price. It sounds to me when I hear you say that conversation, you're really getting completely out of that mold and really the idea of I'm going to actually bring you something really innovative that you hadn't even thought about when you developed your budget.

18:31Automatically, you're providing leadership instead of just execution. That's true, but it's not antithetical to productizing your services either. I, in the, so in my last two books, I've talked about a productization and in pricing creativity, I was pretty strongly anti-productizing for agencies. to date. When I wrote the four conversations, which I finished last year, I was pretty neutral on it. And I have a pretty good framework in the book for deciding you standardize or customize your delivery model, package your services or customize and your pricing. What I mean by that is if you have packages, do you price the packages or do you price the client?

19:18And as time goes on, I'm actually increasingly in favor of product standardizing your delivery. So you have packages but reserving the right to price the client, which is the first rule of, in my book, Pricing Creativity, price the client, not the product, not the service. So I know from many conversations I've had this, you know, anytime I say the same thing of you want to move from vendor to trusted advisor, you know, a lot of lights go on, right? It's like, yes, that's exactly what I want to do. So for the listeners who are stuck in that mindset right now, is there a shift or a daily habit that that you would recommend that might make help people make that leap?

19:58Oh, it's a great question. So there is in the book, there's, I guess it's a principle, but it's really a framework for getting into the expert's mindset. It's called the expert's mantra. And it's a four line statement that you repeat to yourself before you log into the conversation, before you show up for the, whether it's done remotely or in person, before you enter the conversation just four statements that you repeat to yourself they can benefit from a little customization but i'll give them to you here i am the expert i am the prize i'm on a mission to help i can only do that if you let me lead all will not follow and that's okay and we can unpack each of those four sentences and they're all rooted in something but it's like i am the expert i'm the prize to be one here i'm on a mission to lead if you don't let me lead in the sale you will not let me lead in the engagement.

20:52So this is a test of whether or not we can work together. Yeah. And then the last one of all will not follow is just letting go of the outcomes and focusing on the process. Yeah. I love that. I love that. Well, Blair, I appreciate you taking a few moments to stop by the Duct Tape Marketing Podcast. Is there some place for you to invite people to find out more about your work and obviously your books or connect with you? Yeah. Thanks, John. I've enjoyed it. They can reach me and all of my work at winwithoutpitching.com. Awesome. Again, I appreciate you. Take a moment to stop by and hopefully we'll run into you one of these days out down the road.

21:24Thank you.