When I was completing my NLP Trainers training with the late, great Tad James, Tad said to the class “I know you’ll all ignore this advice; but don’t do free, it doesn’t work”.
He was referring to agreeing to give a free training to a client in the hope of winning future business, and of course he was correct. Three times I ignored Tad’s advice and agreed to deliver a free training, each time to a large multi-national corporation with the hope of getting my foot in the door, and each time it led to nothing.
Client’s that expect product or service for free are rarely good quality long term prospects. They will move on to the next supplier that’s willing to give for free or expect discounts. Free doesn’t work.
I was once asked by a major US bank to provide a one-day negotiation training for four of their Managing Directors for free. I can only imagine that each of these MD’s was earning a $1m+ annual salary yet the HR department thought it was appropriate to ask a contractor with no basic salary for a free training. I was quite insulted and my response was to ask if the MD’s would offer a free IPO to win a new client. Needless to say, I never dealt with that bank which means I also didn’t waste any more time trying to build a relationship with them.
I discussed Return on Time (ROT) in my last blog, and this is another example of this principle. There are plenty of high-quality clients out there that will value your product or service. Don’t waste your time on those that don’t. Offering things for free or at a deep discount generally attracts low quality clientele.
For years I partnered with GrabOn type sites to sell discount vouchers for my spas in Hong Kong. I tried multiple permutations in search of a deal structure that worked. While we made plenty of sales, we secured very few new long-term clients because people searching for highly discounted deals tend to have a low level of brand loyalty. There are of course exceptions to this rule, so you have to decide on the ROI and ROT economics for yourself. I’m simply sharing my experience.
Another reason that I don’t believe in free is because by giving for free, you are disrespecting your existing clients who are paying your full rate. Don’t undercut your existing clients. This is not only a compelling argument as to why you can’t offer discounts, but also a risk if your existing clients find out.
Whether you are in sales or not, you are in sales. Even if your business card doesn’t have the word ‘sales’ you are selling your skillset to your employer and potential future employers. You are in sales. It’s critical to know your value. Don’t overestimate it and price yourself out of the market, but also don’t undervalue it.
Do I make any exceptions to the above?
Yes. I have in the past agreed to give a first training for free on the condition that it’s paid in full if a contract for a minimum of X hasn’t been signed within six months of the training date. Using this approach I have converted approx. 80% of such clients to long term clients and the remaining 20% eventually paid for the ‘free’ session.
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Had I known this before - sagacious you, Neil