Niche Marketing in Executive Search “The Box” Your Thinking is Here. My Goal: In 45 minutes, your thinking will be here.

New customer growth rate = 56% New Customers Four year company growth rate = 7% Annual customer attrition rate = 10% Assume you have 100 customers. The normal customer attrition, defection, and inactivity rate is >10% per year in many industries. If you wish to grow your customer base by 7% per year, how many NEW accounts must you acquire? Who Needs New Customers? Harvard Business School estimates that the average business loses % of its customer base every year. The average Fortune 500 company expires in 40 years! Fact: Proprietary products reduce client attrition and improve client attraction.

New Product Development Your Clients or your Product? Make what you sell, or Sell what you make?

Become a Sultan of S.W.O.T. Do a SWOT analysis for each client. Visit them! This will help you determine what type of new service to develop and gauge the strength of demand. S – Strengths W – Weaknesses O – Opportunities T – Threats See handouts Ask yourself hypothetical questions like: What would we do if all of our clients suffered from a poor ability to respond to changing conditions? Domino’s Pizza was unconcerned that other Pizza Chains had dismissed home delivery as unattractive. Domino’s has done its homework and knew the size of the problem … and the opportunity!

How to SWOT your Clients 5. Your offer should not be perfect to roll-out to your Visionary clients. 1. Look beyond the obvious. 3.Don’t be afraid to tread into new functional areas. 2. Think holistically about your clientele’s business. 4. Realize that all problems are opportunities. Which departments are impacted by the problem? How? How can you help them directly or through partners?

Adopters Early MajorityLate MajorityLaggards Pragmatists Stick with the herd! Conservatives Hold on! Skeptics No way! Visionaries Get ahead of the herd! Early Inside the Mind of Your Clientele All clients have different appetites for bold new service offerings.

Early Adopters – The Visionaries Primary Motivation – Gain dramatic competitive advantage via revolutionary breakthrough Key Characteristics –Great imaginations for strategic applications –Attracted by high-risk, high-reward propositions –Will commit to supply the missing elements –Perceive order-of-magnitude gains — not so price-sensitive Challenges –Want rapid time-to-market –Demand high degree of customization and support Key Role: Fund the development of the early market

Early Majority – Pragmatists Primary Motivation –Gain sustainable productivity improvements via evolutionary change Key Characteristics –Understand real-world issues and tradeoffs –Focus on proven applications –Prefer market leaders Challenges –Insist on good references from trusted colleagues –Want to see the solution in action first. Key Role: Gatekeeper to the mainstream market

It’s Obvious Whom to TargetVisionaries vs. Pragmatists Pragmatists Adventurous Early buy-in attitude Think “big” Independent of the “herd” Spend opportunistically Think Pragmatists are pedestrian Prudent Wait-and-see Manage expectations Part of the “herd” Spend to budget Staying power Client references are the key to growth.

Pragmatists Stick with the herd! Conservatives Hold on! Skeptics No way! Deploy the Beachhead Strategy Align with Credible Visionaries Develop your product with Credible Visionaries, and introduce it to the Pragmatists who respect them.

Align yourself with multiple interests within your client’s firm. Technical Buyer Economic Buyer User Key Influencer Business Sponsors are unconcerned with price. They have no concept of what your services cost. All they care about is a solution to their problem. You can’t develop a new product with just the Economic Buyer. Rule # 2: When the needs are NOT well defined … the Technical Buyer’s influence is strong and price is NOT an issue. RULE #1: When the needs are well defined … the Economic Buyer’s influence is strong. Price and multiple vendors are the key issues.

Define the Business Sponsor’s Ideal Again: Proprietary products reduce client attrition and improve client attraction.

Basic Questions for Technical Buyers & Key Influencers 1.What do you want? (stated in the positive) 2.What will having that do for you? 3.How will you know when you have it? 4.How will I know when you have it? 5.Where, when, and with whom do you want it? 6.What stops you from having it already? 7.How will your desired outcome affect other areas of your business? 8.What resources do you already have that will contribute to getting your outcome? 9.What additional resources do you need in order to get your outcome? 10.How are you going to get there?

Train your people. Your people must have the ability to think holistically about the Client’s business. How to Partner with Visionaries Show an ROI. Put your offering in the context of how the client will save with your solution over time. Use spreadsheets to quantify your value proposition. Use the client’s numbers so your analysis is correct in their eyes. Pilot the service with a key thought-leader in exchange for a letter of endorsement on their letterhead. Learn, iterate, and prove concept.

3.Ancillary services that get to the root of their problems or help them mitigate risks. Visionary Hot Buttons 1. Password protected areas of your site. 2. Alternative billing plans that reflect their involvement in product development. 4. Special web tools & resources and other high-touch benefits like Roundtables.

Niche Marketing “Musts” Develop a Tag Line that quickly sums up your USP (like Domino’s Delivers) Learn as much as you can about your area of specialization in multiple industries. Bookmark obsessively! Give away free resources to establish yourself as a problem solver. Use Referral Incentive Pricing: $X or ($X – $500) + 3 written referrals Write articles to establish yourself as a thought leader. See PubList for magazines that can help you get coverage. Name your method for solving the problem (like Euclidian Geometry)

Projected Cash Flows Breakeven For 6-8 months you may need to subsidize the growth. But gross profit builds as you cross- sell and up-sell the new customers... and build scale in the new channel. Good News: The NPV’s are positive

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