Jeremy Couch – Building an effective prospect list can be a challenge, but if done correctly, a prospect list can be a key instrument in growing your business. A prospect list is the foundation that your sales strategy is built around. The key to a successful prospect list is that it needs to be focused, organized and managed with discipline. As many successful businesses know, your best prospect is a current client, with past clients being a close second. Unfortunately, this is not a luxury that a startup business has and therefore must build its prospect list from scratch.
The first step in creating a successful prospect list is to define your target market. What would the perfect client look like? What are the perfect client’s characteristics, desires, activities, habits, geography, etc? Also, ask yourself “who buys what, why they buy it, and where they buy it”. Once you have completed this exercise, you are ready to build your prospect list.
First, decide how many prospects you need. At this point, you should already have sales goals in place and a good understanding of how many calls that will result in a sale. Once you have that number, it’s time to start adding to your list. You should collect any important information. This could be the name of the decision maker, address, phone number, number of employees, region, name of the gatekeeper, etc. There are several ways to come up with names.
- Networking – Go to networking events with an agenda. Know how to spot those who fit your target market. Set a goal around number of introductions, business cards collected, business cards given out, etc. Use that information to input in to your list.
- Business Relationships – Look at the current relationships that you already have. Would any of them fit your target market?
- Referrals – Don’t be afraid to ask for referrals. You can ask current clients, business associations, or local chambers of commerce.
- Publications – Make sure you have access to publications that your target market might be featured in. This could be newspapers, business journals, etc.
- Hoovers/NAICS/Reference USA – Use software such as these to do industry searches. Most of the time you can get contact information, addresses, # of employees, square footage, revenue sizes, etc. You can customize your search using industry codes, zip codes, employee size, etc. Although these websites do charge a fee, this is a service of the ISBDC so contact your local Advisor for assistance.
- Website – If you have a website, offer a reason for the prospect to give you their information. This could be for future industry news, product specials, etc.
Now that you have your list, how do you manage it? If the list is not managed correctly, you spent all this time coming up names for no reason. You must be disciplined in a way that you do not come off like you are harassing the prospect. One way is to break up your list in to thirds. You will be calling on group A in January, April, July, and October. You will be calling on group B in February, May, August, and November and group C in March, June, September, and December. There will be reasons to remove certain prospects and add new ones so your list will always change.
Each time you call on a prospect, make sure that you take at least one piece of new information away from the call that you did not have beforehand. The information could be anything from learning about the contacts family, hobbies, etc. This will help you break the ice for the next call. Also, just as important is getting to know the gatekeeper. Get to know their names and what they like because ultimately, they are the ones who decide if you speak with the decision maker or not. Once you collect this data, it is a great idea to use your company’s CRM (Customer Relationship Management) system. Therefore, you can look at your notes before each call and remember the information that you have collected. As a result, you are building relationships and trust. You are no longer “cold-calling”.
There are many different ways to effectively create an action plan around your prospects. I would suggest creating a prospect list around both a potential clients and current clients. As stated earlier, your current client is your best prospect. They have already done business with you and you have already established the need. This is also a great way keep a client from slipping through the cracks and going to a competitor. Always remember that your prospect list must be focused, organized and managed with discipline.
Jeremy Couch is a Business Advisor for the Southeast Indiana Small Business Development Center, an organization with the mission of having a positive and measurable impact on the formation, growth, and sustainability of small businesses in Indiana, and to develop a strong entrepreneurial community. Jeremy can be reached at [email protected].