The Green Sheet Online Edition
September 14, 2009 • Issue 09:09:01
Do's and don'ts of merchant mining
The primary challenge within any sales environment is identifying potential clients. Seminars are held on how to qualify a possible customer and even how to cold call for leads. Even so, some excellent closers find they have difficulty developing leads.
Many ISOs have even started paying for warm leads. A cottage industry has developed from this need alone, one that earns revenue for lead generators when warm leads are produced. The need for leads is that strong because without leads, there are no sales.
However, with all the concern and energy spent in finding leads, the best sources for leads are often ignored and overlooked. Among them is the easiest source, and one that costs nothing - your existing merchant base.
Yes, everyone has heard of the value of generating referrals from merchants in your own portfolio. It can be said the value of leads generated in this way exceeds those that arise from any other source. Best of all, these leads are earned by your direct actions and actually breed further leads. Yet, few ISOs and merchant level salespeople actively tap this source of business. Those that do find it to be a goldmine.
The stumbling block to proper mining is often the mentality of the sale. If you have ever said something like, I know my merchants are happy - they never call me, you will likely have tremendous difficulty mining your merchant base.
You must have the mindset that as long as a merchant is processing through you, the sales process with that merchant is ongoing. To maintain this mindset there are basic do's and don'ts that will help you successfully mine your portfolio.
#h4 The don'ts
- Don't outsource the download or install: For many ISOs, the time spent at the install means time away from selling. But keep in mind that merchants are never happier than at the beginning of the relationship with their processors.
In the 1980s, the real estate community discovered this basic principal and began leveraging it. As the purchaser signed closing papers, the agent would have one paper for completion that asked for 15 names and phone numbers of people whom the buyer knew.
It wasn't asked whether potential clients might be interested in the closer's business. The explanation for the question went as follows: Everyone has a desire to own a home someday. All I want to do is help them meet that goal or even help them improve their current situation.
So, along with the terminal training, use the time it takes to download the terminal software to have merchants complete a similar questionnaire, one that asks for the names of three to five merchants they know. Again, the approach is simple - all merchants should accept credit cards, and if they already do, you may be able to better their situation.
- Don't ignore your merchants: No matter the size of your merchant base, you must touch base with each merchant at least once a quarter. Ideally, you should originate the contact through a call, newsletter or a brief, in-store visit.
Not only will this help increase merchant retention, but it will build rapport and trust. Your customers will be more likely to trust you with their referrals if they are comfortable with you. As your merchant base grows, contacting every merchant quarterly becomes harder to do, but it is a must.
- Don't pass up opportunities: Every time you talk to a merchant, ask him or her for a referral, even if the merchant is calling with a problem.
For example, if a merchant calls you with a question or concern that requires your involvement, first address the concern, ask if the individual is satisfied with the resolution and request a name of someone who could benefit from comparable service. You will be surprised at how many times you will receive a positive response.
- Don't refuse indirect or cold referrals: Merchants may truly not know other merchants like themselves. However, they do know indirect sources of leads and can be door openers for these opportunities. Ask them for alternatives to direct referrals such as lists of other tenants in commercial buildings, leasing agents or even names of competitors.
Such contacts can potentially result in more leads.Remember, your goal is to get leads that result in new merchant contracts - directly or indirectly.
#h4 The do's
- Do name drop as part of the introduction: Getting referrals is nice, but having the ability to say to a prospective client that a particular merchant gave you the prospect's number gives you credibility.
Remember, one difference between a warm and cold lead is the likely willingness of the lead to talk with you at the initial contact. Merchants who are called because someone they know and trust gave the caller their name are more likely to open up to you, creating immediate rapport.
- Do contact every name and lead given: It is imperative that you get in touch with every name you are provided and then offer feedback to your existing merchants on those contacts. Your merchants trusted you with their reputations. That trust can be damaged if their referrals are not handled with special care.
Special care also means that you tell the referral when you can't help them. Keep in mind that what you say to a referral will likely get back to the referring merchant.
- Do reward merchants who refer you closed business: Rewarding referring merchants that pay off in new business is a common practice in other industries. The reward doesn't have to be monetary.
It can be a box of chocolates or even a gift card to one of your other merchants' restaurants. The size of the gift doesn't matter. Just make sure that when you drop it off you ask for more referrals.
Those who mine their merchant base often find they make fewer cold calls and spend less time chasing after cold leads. Referrals generated from your own stable of merchants make for easier sales and usually become lead sources themselves.
No matter the size of your merchant base today, start mining. You'll be surprised how fast that base grows.
Jeff Fortney is Director of Business Development with Clearent LLC. He has more than 12 years' experience in the payments industry. Contact him at email@example.com or 972-618-7340.
Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.