By Jeff Fortney
The Strawhecker Group
If you have read my previous writings, you know I've made the case that if you intend to remain successful in the payments industry, you must revamp marketing efforts in response to changing conditions. The new normal is real, not a brief interlude before we go back to the way things were before the 2020 lockdowns.
This is difficult for some merchant level salespeople to accept. At times, people of my generation remind me of a variation on the old light bulb joke. Question: How many Lutherans does it take to change a light bulb? Answer: What? Change?" (I am a Lutheran so I can get away with repeating this joke.)
But it's impossible to ignore today's sustained increase in online and phone ordering, or the new or increased web presence of even the smallest merchant. Talk to underwriters and have them tell you about the need for additional documentation on what used to be auto approvals. They will tell you about the increased documentation that is required by the change from 100 percent face-to-face to even a percentage of only 30 percent non-face-to-face sales transactions.
For many merchants, increased risk now must be considered during the approval process. Yet asking for additional data can be uncomfortable. Merchants are likely to push back with a statement like, "I was never asked for this before."
If you revert to asking merchants to show you their statements so you can save them money, today's added documentation burdens will likely drive away merchants you approach this way. Even if they take you up on the offer, your profit margin will not justify the pain to get them to sign, and your retention likelihood will be poor.
I have discussed techniques, questions and steps needed to garner information about merchants' pain and then leverage the answers to that pain. Yet even with merchants who represent our best candidates, the sales activities and practices we used before the pandemic need to be adapted to this new normal.
When discussing the new normal recently an agent asked me, "Can I still call on all merchants within a shopping center if one of the merchants I am targeting is in that center?" The answer before the pandemic was that you should—and leverage your completed call to your advantage.
That answer is no longer appropriate if you want to be successful. In today's new normal, rather than go from merchant to merchant in the center, you first must research the merchants you intend to approach to gain adequate initial information. This doesn't mean you should pass up opportunities; it means you must follow the requisite steps before every call—including doing preliminary research. It may take only five minutes and can be done in the car. But it's a necessary step to the process.
This isn't the only change we need to make post pandemic. Some long-standing approaches may merely need tweaking; other approaches may no longer be viable; some new approaches may even sound preposterous at first. In any event, as 2021 draws to a close, now is the best time to examine current practices and address the changes needed. Cold calling, direct mail and email are among them.
A pure cold call, where you know nothing about the merchant you are targeting, has always been the most difficult of all calls. But it's always been considered a necessary evil. Today, with proper planning, a true cold call should not exist.
I explained previously that a simple web research provides information that can open doors to opportunity. This is true even for a cold call list. The key step before any face-to-face cold call is to do the basic research. You will go in with a basic understanding of the merchant's business, have a grasp of their products, and probably know who the primary contacts are.
You can also take steps for outbound cold calling that can, and will, improve your results. And similar to in-person calls, it begins with a web search before you dial. In addition, as you make calls, have the webpage open while on the phone with the merchant. You can even lead with, "I was reviewing your webpage and was very impressed. In fact, I have it open now."
Five years ago, the success rate of direct mail was less than 1 percent. Factoring in the costs of creating the mailer and postage, anything near 1 percent was considered worthwhile. However, today's merchants have little time or inclination to consider an offering in a mailer. And with the cost of postage, the mailer's approach can't be scattershot.
If you want to use mailers, it is important that your mailer targets a specific group and speaks to their industry. For example, if you are marketing to auto repair shops, the mailer should speak in their language using their industry terms. It can, for instance, reference the costs of a brake repair, body work or even insurance copays. It should remind them that today's consumer doesn't pay with cash. Close with something along these lines, "Your payment acceptance is that critical, especially today. Let us perform a full audit to ensure you are positioned correctly, and are getting what you expect."
One positive about this approach is that cost is not a significant part of the equation. With a good list and software you can send hundreds of emails quickly. Yet, like direct mail, email is easy for recipients to ignore—maybe even easier. Indeed, if you checked your email inbox now, I expect you'd find one, two or a dozen unopened messages.
Many email campaigns use the drip method, sending messages at specific intervals. Sometimes the sender's email address is ghosted. While this approach is common today, I'm honestly not sure how effective it is.
Success is found in addressing the right topic. If the topic can draw prospects into reading the message, there is a chance they will find something interesting. The body of the email must hold their interest, while creating curiosity. And the goal is a response.
As an aside, I must say that the minimal cost of email campaigns makes them worth considering for inclusion in your marketing efforts, if only to just open doors. However, you must not spill your candy in the email. The goal is to pique their interest. If you can accomplish that, you will potentially see a response. If not, the email list will at least provide a listing of prospects for a face-to-face marketing effort.
Many other types of marketing efforts are used—referral partners, for example. But, no matter what approach you take, if you know your prospects, understand their business needs and provide solutions that will help them grow—your business will grow, too.
Jeff Fortney, a senior associate at The Strawhecker Group, is a long-time payments industry executive and mentor. He is focused on sharing his industry knowledge and experience with others to help them grow their business. He can be reached at 214-458-1379.
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