The counter-intuitive headline ‘Negative reviews drive sales, claims marketing expert’ on Marketing magazine’s web site caught my eye. But as I finished reading I was left none the wiser about why. Normally I would have stopped there and thought no more about it but the man behind this claim is Don Peppers, a widely-acknowledged marketing expert.

To get to the reasons for Peppers’ claim I had to spend an hour watching his presentation at a recent conference about social media and marketing. I heartily recommend you make the same time commitment. He’s a great presenter and you’ll probably come away feeling like you’ve learned something for free about what motivates buyers. But if you don’t have time, I’ll summarise what he says about negative reviews.

First, don’t be afraid of allowing people to post website reviews of your products or services. Sites with a few negative reviews but mostly positive ones will sell more than those with 100% positive ones. Why? Because people will view the former as more trustworthy, more authentic. Peppers calls this ‘trustability’. He tells the audience that trustability is about companies acting in the customers’ interests and not exclusively for their own benefit. These firms, he says, will be the ones that succeed in future.

To illustrate his point he talked about an insurance firm he uses. He once called them to buy a policy he thought he needed. The agent could have sold him the policy and that would have been the end of the matter. But instead, the agent queried his request and, on hearing about his needs, explained that a cheaper policy would provide the right level of cover. The company made less money on this single transaction, but at a stroke became ‘trustable’, gaining the loyalty of a well-known marketing expert who tells audiences around the world about them. That, clearly, is priceless in terms of endorsement and advocacy.

As Peppers reminds us ‘how you treat your products (or services) today will have no effect on their price tomorrow, but how you treat customers today has everything to do with their value tomorrow’. Wise words we would all do well to remember.

I really like how a freelance Dutch creative duo used Twitter to get noticed  and ultimately hired by a hard-to-reach group that happens to spend a lot of time on Twitter: creative directors in advertising agencies. Naturally, I’d prefer you not to leave this site but the video isn’t available for download; its creators clearly want you to visit their Vimeo page. Here it is: Winning business with Twitter

Nonetheless, there are still plenty of sceptics out there when it comes to social media use by companies that sell to other companies (B2B) as opposed to individual consumers. Half an hour spent browsing the marketing website B2B Bloggers should be enough to answer any doubts, starting with articles like this one.

And if you still have doubts, do some further reading on Google’s latest moves to include social media activity in search results. This blog entry by Seatle-based search software firm SEOMoz explains what’s going on and why.

Most business people are understandably wary of talking to journalists because they know they don’t control the outcome. They worry about looking stupid, being misquoted or misunderstood. There are techniques you can deploy to minimise all of these possibilities but for this posting I want to talk about another danger: finding you’ve ended up offering the unintended ‘contrarian’ viewpoint.

This happened recently to a university professor who was invited alongside myself and three other very experienced PR professionals to offer his views on the importance of selling in public relations. He was first to be interviewed and gave his view that selling wasn’t very important, saying he’d never been asked by employers to include selling in a course syllabus and that it wasn’t necessary. Everyone else, including me, said it was a key skill and that it was vitally important to be good at selling to do the job well. Here’s the resulting article. Judge for yourself but I think the academic ended up looking out of touch.

One of the key things I teach people in media training sessions is this: before you begin a discussion, ask the reporter who else is being/has been interviewed and where you sit in the planned interview sequence. That allows you to think more carefully about what to say, plus it gives you the chance to politely ask the reporter to interview you last of all (when you can ask what others have already said and add value to/take issue with/correct/balance previous comments), or request that they come back to you to review what you’ve said in the light of other comments. It’s not always practical but can make a very big difference to the end result.

Photo courtesy of gabemac http://bit.ly/mDAMPF

Some people find this Youtube video of a mock-plaintive junior at PR agency Ten Yetis amusing. Maybe it did the trick but it left me feeling a little embarrassed for her. If I was her client, I’d be wondering if that’s all there is to pitching journalists – and wondering if I didn’t need a little more marketing savvy injecting into my PR efforts.

Why, for example, was there not one single good reason offered up to the journalist to write about the product in that video? Why do readers need to know about it, why is it better than similar apps? It’s not like there wasn’t enough time – she had plenty to plug the product name (three times I counted). Maybe it’s a pile of crap and maybe that’s why, as a pitch attempt, this PR flack’s effort was pretty lame. Just my view of course, based on the information available at the time of writing. Am I right or am I being too harsh?

Note: a couple of days after writing this post, I was directed via a Twitter follower to this blog entry about other ‘quality’ output from Ten Yetis PR. And today, a very experienced trade magazine editor read my post and told me “they do the kind of PR that makes you want to kill out their emails before you even read them.”

Most people old enough to be in senior management roles today know the slogan ‘Let your fingers do the walking’. It did wonders for promoting Yellow Pages and joined the advertising hall of fame back in 2002. But how about ‘Let your clients do the talking’? Nope, that doesn’t resonate quite so loudly does it? But it should, because credible endorsements from others are one of the most potent sales tools in business-to-business, especially if you’re selling professional services. PR professionals call this ‘third party endorsement’ (TPE) and, well managed, it can win you business, forge alliances, improve recruitment and retention, and help in a multitude of other reputation-enhancing ways too.

TPE is so powerful because it responds to a basic psychological need. In business – indeed in life in general – when presented with an important choice, dilemma or problem, we tend to look around us to see what others in the same circumstances have done. Even if we already have a good idea about the appropriate course of action, we still tend to look for external validation of that choice. Both scenarios present management with an opportunity for their firm to be seen as the best choice of solution provider.
Here’s another very good reason why TPE is valuable in marketing terms. Journalists will be much more interested in your story ideas if they are ‘client-told’ as opposed to stories told purely by the firm. Good journalists will instinctively seek out independent validation and evidence when presented with a claim. It’s part of their training to be cynical.

They also know that good stories need tangible examples readers can relate to in a meaningful way. They want drama, personality and, even in dry business publications these days, a little entertainment. Because journalists are more time-pressed than ever before, if you feed them your choicest case study morsels, chances are they’ll bite your hand off.

So, by exploiting TPE, you’ll be benefiting from powerfully-told endorsements of your services and expertise, and pushing against an open door when your PR team contact the media. Why then, are more firms not making the most of such a great opportunity? That’s something I’ll cover in a forthcoming post.

Most companies who hire marketing services firms love to assert their power by making their suppliers jump through hoops from time to time, and it’s an increasing practice. Which is why, a few times each month, suppliers of advertising, public relations and other marketing services have to participate in a time consuming and usually fruitless ‘beauty parade’ game, otherwise known as pitching for client business (other businesses use the more generally known term: selling).

I’ve been on both sides of the fence on many occasions and can tell you it isn’t pretty. Clients often draw up flaky briefs that are impossible to interpret and then refuse to be pinned down by answering perfectly reasonable questions of detail. The agency people will try to persuade the client that they’ve had their best account team giving lengthy, considered thoughts to the brief. In reality, it’s likely that most of the effort is the result of whichever individual has enough free time working into the wee hours of the night before the pitch. So it was interesting to see the results of a survey on this theme from the UK’s Public Relations Consultants Association (PRCA) reported here.

The survey, completed by 51 out of the 180 PRCA firms, found that the amount of time spent on a new client sales pitch varies widely but the average is 20 hours. That got me thinking about the cost. Fortunately, the PRCA also produces another survey called the ‘inter-firm comparison’. This is an anonymous survey allowing agency management to benchmark their businesses against other PRCA member firms on various factors, including hourly rates charged. To arrive at a reasonable cost estimate for our average 20 hour sales pitch effort we have to make some assumptions about how that time breaks down. Here are my ‘best guess’ assumptions:

• Board Director: 2 hours
• Account director: 8 hours
• Account manager: 6 hours
• Account executive: 4 hours

Using the PRCA’s 2009 hourly rates for the different job levels, and the above breakdowns for time, the theoretical cost of that one sales pitch, based on unrecoverable hourly rates alone is £2,292. Over a typical 46-week working year, assuming the agency pitches once every two weeks, the theoretical annual cost amounts to £52,716 per agency.

This figure excludes any third-party costs. PRCA communications director Richard Ellis says the 20 hour average refers to ‘time spent preparing for a new business pitch’. We must therefore assume it does not include the time travelling to, from and attending the various pitch process meetings, multiplied by the number of people from the agency involved; it looks a bit on the low side otherwise. Neil Backwith* thinks so too. He tells me 50 hours is the average time investment for a new business pitch made by the groups of PR firm CEOs he works with. If we use Neil’s figure, the annual cost jumps to £142,312 per agency. But even this might well be conservative. Ellis says the survey figures “went into the ‘over 200’ at the other end of the scale”!

Who pays for all this? Clients ultimately, of course, but indirectly through the fees agencies have to charge for their services. As Backwith points out,

“By asking more agencies to pitch clients will end up paying higher rates for the privilege – quite the opposite of what they hoped for!”

Do they and their procurement colleagues realise this? Do they care? Is there a better way? Microsoft’s Peter Devery clearly thinks it’s time for a change, stating in a recent PR Week article that:

“…. the PR pitch beauty parade is a legacy of an old industry. The process is lengthy, costly, resource-hungry, inefficient and often does not result in the required level of understanding which will lead to a fruitful partnership. We have to move the industry on, for both the agencies’ and clients’ sake.”

Some in the agency world are fighting back by banding together and refusing to pitch. But sadly it’s the Belgians who are doing the rebelling, not the Brits.

Postscript Feb 2011: I’ve just discovered www.winwithoutpitching.com, founded by Canadian Blair Enns. The resources on his site are well worth a look.

* Neil Backwith is a management consultant, trainer and mentor to professional services firms and their leaders. He was previously chief executive (EMEA) at PR firm Porter Novelli. He is author of the PRCA book ‘Managing professional communications agencies’.