How To Become A Successful Relationship Builder With Mike Claudio (Part One)

Success leaves clues. In this episode, Sam Wakefield interviews Mike Claudio of WinRate Consulting to ask about some of his guerilla philosophies to become a relationship builder. He discusses the four pillars that he applies to qualify leads, and that can help grow your business more sustainably. Emphasizing the importance of building relationships, Mike then talks about how you can hunt for leads by creating good content and showcasing your background. By creating a good experience and communicating professionally, Mike has sold over $10 million in projects. Get to know his approach deeper in this conversation, and learn how to leverage it to your own success.

I’m excited about this episode. We’ve got a special guest, Mike Claudio. He is a freaking expert, rockstar trainer and business coach. He is a sales expert. I came across him on YouTube. If you haven’t checked out Mike Claudio on YouTube, go check out his channel. He has some amazing, great content. His focus is on construction and general contractors and general construction overall. I was excited to come across him because many of the things that he talks about, I talk about. The similarities started to hit home with me because it made me realize the philosophy is the same. When we’re out in the world, when we’re doing what we’re doing, there are some common themes for success.

There’s the expression, “Success leaves clues,” and when you find those clues, you follow them as far as they can take you because that’s how you learn. That’s how you grow. That’s how you become better. Mike’s got many years of experience in sales. He has got several plus years in the construction industry. He’s a coach and has taken several businesses, not just in one thing, but in multiple trades is grown to over seven figures. That many bucks a year. That’s a big number. In his own sales, they are throwing up some massive numbers at a roofing project with $1.2 million for one single project. Also, he had sold a remodeling project for under $500,000. Those are some rockstar numbers in anybody’s world. I’m super excited to welcome, Mike Claudio. Mike, how are you doing?

I’m good. I appreciate it. I am excited to be here. I’ll be honest, I know there’s a lot of people who tout big numbers, but I’d like to give some context to those throughout this interview and what those meant to those businesses when I sold them. It’s easy to say, “I closed a bunch of big projects,” but most of those came after 18 to 24 months of some little things and growing the brand, our message and our identified client, which I know we’re going to get into. I’m not like, “I only close big projects.” Those were some of the biggest ones I closed after months, if not years of doing the right thing consistently. There are a lot of tools that are like, “I close a million-dollar project every month.” “No, you don’t.”

I’ve sold $1,500 repairs and $1.2 million roofs. I know all aspects of residential and somewhat, commercial construction and what these people are dealing with, and how they make decisions. They’re all sides of it. I didn’t start selling big projects. I started selling repair work for a remodeling company, then started selling $40,000, $60,000, $150,000. I kept up before I left that company about a $500,000 project. There’s a lot to learn, but I learned the hard way, and that led to why I coach the way I do because I try to shorten that failure gap for a lot of salespeople and business owners in the industry because dealing with homeowners is tough.

It’s the stuff that we all know and as you know, the focus of the show, we are predominantly HVAC, but also, we’ve got some other trades like plumbing and electrical. I have a big fan, shout out to JP. He sells cars. He’s in the automotive industry and he loves my show. He says, “The philosophy is the same. Anytime you say air conditioner, in my mind, I substitute it with cars because it works.” Talking about it now, the philosophy is the same. It’s about serving people. It’s about solving problems in a way that no one else is willing to do the due diligence to solve the problems.

It’s also understanding who those people are because everybody’s not your ideal client. That’s one of the biggest misconceptions in this industry like, “Everybody with a home is a good referral for me.” No, it’s not.

We were talking and one of the things that we had covered is your philosophy surrounding the four pillars of what makes a great sales call in general is the soup to nuts of the whole process. I’d like to go into that a little bit and give everyone a good feel for the philosophy that you have with what you teach in your courses and training.

When I got into the industry, it was the 2012 or 2013 timeframe. The world of social media is not what it was. There are funnels, ad spend and Google Ads, Facebook funnels, and all this other stuff. It was around, but it wasn’t as relevant as it was these days. I took several businesses and grew them by seven figures without spending a dollar on leads, without spending money on marketing in its normal sense. What I teach and what I go over is around relationship-building, outbound sales like prospecting outbound, social media engagement, referral partner creation, networking, branding, investing in the marketplace in your region, but not like, “I’m going to put a bunch of it on the internet and may help with leads come my way.”

It is a unique approach where a lot of people have seen it. There are a lot of people that are touting like, “Spend money on ads and you’ll get leads.” That wasn’t my approach. I took my experience in Corporate America and blended it into this industry and came up with the four main pillars that we’ll call, as far as what I focus on the most, Identify, Target, Qualify, and Acquire. Identify what an ideal project looks for you demographically, psychographically, and project type. Understand how to target them through prospecting, networking, referral partner creation, then what to do to qualify that lead when it comes in because we’ve all wasted time on crappy clients and then you found out too late. It is how to properly qualify them, not just once they call in, but how do you use your messaging in your social media, on your website, and other campaigns that you might do to help qualify in the right clients and out the wrong clients.

What do you do to differentiate yourself before, during, and after in-home sales consultations to differentiate yourself to close the deal? If you can do those four things effectively, at least I’ve personally proven this through my personal efforts and through coaching other companies, you will grow more sustainably. You may not spike overnight because you got a bunch of leads, but the problem is, in my opinion, leads are getting more expensive and lower quality because these lead sourcing companies like Angie’s List and HomeAdvisor of the world make money by selling leads. They have to have more leads to grow their revenue. They’re saying, “You want to say you’re interested and we’re going to go sell your interest to a bunch of people.” There are lawsuits all over the country against companies like that for false advertising and providing incredibly poorly-qualified opportunities.

I’m more about hunting, going out, doing the right things, and building relationships on my own efforts as opposed to casting a line, putting some bait on it, and hoping somebody bites. It’s a little bit of a different approach, but it’s not for everybody. If you’re not comfortable being on camera, you’re not comfortable being in front of people, it would help you a lot to learn what I teach, but it’s not for everybody. For the people who are out there, I’m not a door knocker. I’m more of a relationship builder. I’m not a one-call close guy. I’m a soft close and then follow-up. I don’t think homeowners in general. The environment has taught them that they can make decisions in their timeline.

What I coach on is how to use and implement your sales process but within their timeline. It is driving your process, but letting them control the speed. Forty percent plus of my sales over the 6 or 7 years that I was doing it personally came from follow-up directly. I sold over $10 million in projects. Follow-up equated to $4 million approximately in sales over a 5 to 6-year period. The primary focus is how to create a good experience, communicate proactively, communicate professionally, guide them through a tactical in-person consultation, and then follow up the right way to close and deal when they’re ready. The minute you force somebody into making a decision in person, the buyer’s remorse is real and homeowners feel icky about it.

They’re not going to refer you to somebody else because they don’t want you to push them into doing something they’re not prepared to do. You consult them through the process and help them, educate them on what is and is not a good idea. You’ll lose projects that come back and say, “I hired the other guy, but can you come and fix what they did?” That happened a ton of times. They knew I was going to give them an honest answer. I’m not going to tell them what they want to hear to close the deal. I’ll give them accurate information to make an educated decision. When you do that, you create more of a better user experience.

I have a similar story. I quoted a project for a gentleman and he ended up going with somebody else. He was like, “I like you. Everything was great. The presentation was great. The info was great. The project is great, but I went with this other guy because he was a lot cheaper.” Months later, his neighbor called me and said, “You’re a referral from my neighbor.” I started looking back at my records. I’m like, “You didn’t go with us.” When I got over there, he said, “He told me that he recommended you even though he didn’t use you and said not to use the company that he used because it was nothing but headaches and trouble.” I ended up getting a fantastic sale out of the neighbor.

It happens more often than not.

Yes, because of integrity, service, and solving problems. I would like to circle back to where you started with because one of the big hot topics in our environment and the world, especially with all the Coronavirus and COVID-19 and all this craziness that’s going on is it’s feast or famine with the companies that I’m working with. I’m either hearing like, “Our company had a record-breaking month,” but that’s not the majority. The majority of companies and people in all industries are having a hard time getting the phone to ring. Let’s circle back on what you were talking about the gorilla ways to acquire leads, acquire clients, and customers without having to dump a lot of money into marketing, ad spending, and that kind of thing. In our company, our average cost per lead is about $600 which comes in our marketplace and it’s enormous. It’s a huge number. We do everything we can to try to get referrals and that kind of stuff, but what are some ways to do that a bit better? I know everyone wants to know that.

Successful Relationship Builder: The minute you force somebody into making a decision in person, the buyer’s remorse is real.

The unfortunate reality is it’s not quick. The tactics that I use are not fast, but what happens is companies that are thriving or the ones that put in the right work to build a relationship with their market over the last months. They’re working through a pipeline that was built up because of the value they put in. People who are waiting on the next lead, when that faucet turns off, your business turns off. I’ve seen businesses doing $4 million to $5 million go bankrupt in three months because they were spending $40,000 a month on fricking leads. When the leads dry up, it doesn’t know how much money you have. There just aren’t leads there, but there are still people making decisions. Some of what I coach on, and this isn’t a new theory, I’m not taking credit for this, but people buy it from they know, like, and trust. The best way to get people to know, like, and trust you, is to pour into your market with content that is entertaining and educational. If you’re saying like, “I don’t like the way I look on camera,” you’re losing, you’ll get it.

This always makes me laugh if you’re reading saying, “I hate the way I look on camera.” What do you think you look like in people’s homes when you’re selling them? It’s the same face. If you don’t like it on camera, you sure won’t like it in person because you can’t even edit it. What do you think you look like in person? It’s the same. What you need to be doing is putting out consistent content on your platforms, whichever one you’re on. Start with the one you’re most comfortable with and create some content tree to start to build a relationship with your audience. Anybody who’s been on social media for any period of time has built relationships with somebody they don’t know that they feel like if they saw in person that they’d be friends with. Your audience is no different from you.

What happens is that people who relate to the way you communicate, the way you think, the way you problem solve, the way that you articulate become better clients because they already know that they like the way you communicate. People who don’t like the way you communicate, the way you think, or the way you problem-solve won’t call you. Who wants to work with somebody who doesn’t like the way you operate? Those are challenging clients, but people are afraid to qualify out because of the feast or famine or scarcity mindset of, “I don’t know where my next leads coming from.” If you fall in love with the process of building a machine that gives you leads, you’re not worried about the leads, you’re worried about the content. This is a stat that surprised me even I learned is of everybody who will ever buy from you, only 6% are ready to make a decision.

Sixty to seventy percent will make a decision in the next six months. If you’re not putting content out consistently, they’ll forget about you after that one ad they saw that one mailer or that ad in a magazine. They’ll forget about you because they aren’t ready to make a decision. They’ll make a decision in 4 to 6 months with whoever’s at the top of their minds when they make that decision. Your job is to cultivate that relationship consistently, so you’re always the person they’re thinking of. In order to do that is by video content, doing entertaining and educational stuff to inform and entertain your audience because that’s what people remember. That’s what makes people stop. In the HVAC world, before and after pictures of a heat pump isn’t going to get it done.

What are some better ideas? That was good. When you say putting out content and using the platforms, I 100% agree. I know what you’re talking about, but lots of contractors, lots of trades, are not as well versed with social media or any type of digital marketing because they’ve been busy doing the work. If I was brand new and I was coming to you as a coaching client, you said, “You don’t have anything. Let’s get started.” How would you walk me through that process of, “Where should I go first? The easiest entry and at the same time, what do you mean by content?” If the before and after pictures aren’t enough, what is enough? What do you recommend?

We probably both deal with it a little bit where we’re like, “We underestimate the different levels of knowledge of it.” You don’t want to get too granular, but it’s a great question. I would start with a business Facebook page and a business Instagram page. That’s where the average homeowner or consumers are going for information. People say, “Do I need a business Facebook page? Some tips on that?” No one’s going to see it unless they’re looking for it specifically unless you put ad dollars behind it. Facebook is a for-profit business and on business pages on Facebook, they will not show it to hardly anybody. I have over 1,000 followers on my business Facebook page, but if I don’t put money behind it, twenty people see it.

They throttle that aggressively. You can put a small amount, like a dollar or two a day behind a post, which I’m not going to get into to build all that out, but it’s there for people who search for you. Instagram is a lot easier for people to start to build a relationship because it’s easier for you to engage with other pages. I’m big on outbound social media engagement where what that looks like is, if you’re an HVAC company and you want to get involved with some of the biggest real estate groups in your region, you would start your business Instagram page. Go then and engage with those business pages so they can see your name and engage back with you. You’d follow their page, you’d like a couple of their posts, you’d comment on some of their posts, maybe you shoot them a DM to introduce yourself and that’s an easy way to get to people who would not normally answer the phone or answer an email.

DM Is Direct Message For All Of You

You would send them a message on Instagram but honestly, following their page and then getting them to follow you back. If someone follows you more often, you will follow them back. You would engage with their page in some way. That gets you to the content question. What is good content? One of the simplest ways to start if you’re like, “I have no idea what to talk about.” At the end of every day, I want you to sit in your truck or your van and say, “What is the biggest lesson I learned? What is the biggest problem I solved?” Nine times out of ten, those lessons and problems that you’re engaging with, the majority of the people that would want to hire you are dealing with the same thing. You would tell the story, “I’m leaving from a client’s house and they were complaining because one of their zones, the upstairs in the house was not getting the right temperature, but the bottom was.”

What we found out was the damper here or this heat pump or this other thing, and we were able to solve that and get their house right back at temperature. If you’re dealing with stuff like that, “I’d love to talk to you about it too.” Tell the story in whatever biggest problem or lesson you learned because it can be something simple. Don’t be afraid to be vulnerable. You could say something like, “We learned this crazy new thing about these new carrier units that we didn’t know before and we’ll reverse it in this. If you’re dealing with this, maybe your technician or the company you’ve been using doesn’t realize what this new technique or this new tool or this new problem. We learned that and we’re ready to talk about that with future clients because we were able to get with the carrier, understand what this new problem was, understand what this new part needed is and we can help this problem better and more modern going forward.”

Talking about the biggest lessons you learned in this new tool you found or this new process you learned. What happens is when people start to engage, you outbound, you follow a bunch of these people, property management companies, a real estate agent, maybe contractors, whatever your HVAC business focuses on, but you start putting out content that shows you’re an expert. What has historically happened is people get on and say, “I’m Mike Claudio with Mike Claudio HVAC, we operate with integrity and we’re the best in town and we’ll get to you quickly.” That works if everybody else is saying, “Hire me at your own risk.” I might take advantage of you. There are no differentiating factors to that.

People know it’s lip service. When you start to tell the stories about what you’re doing day-to-day and how you’re helping people in the problems you solve, people will learn that you are trustworthy, have integrity, operate effectively, and are good at what you do without your need to say, “We’re great and we operate with integrity.” Because you’re telling people how you operate consistently and that works better because ultimately, I mean this with all due respect, none of your clients give a crap about your backstory. Are you capable and affordable to solve a problem I have? That’s all they care about.

Successful Relationship Builder: Companies that are thriving are the ones that put in the right work to build a relationship with their market.

Everybody tells the exact same backstory on paper and I had this conversation with somebody. She’s like, “On paper, your quote looks the same as these other three I’m looking at. On paper your company looks the same as all these other companies because you all have a reputation, you’ve all got good ratings, you’ve all got good reviews except the prices are different. Why should I buy from you?” What is different about you versus any of these others because it all looks the same to me?

I go this as simple as I can make it. You are your only differentiating factor. People buy people. People don’t buy products, they don’t buy brands, they don’t buy reputation. They buy people who they feel most comfortable with that can solve their problems. I’ll prove it to you. This is something that I’ve been saying for years and it helps people click. If people bought brands and products, Nike would never need a person in one of their commercials. They would only need shoes. They put LeBron James in there because people buy LeBron James, not Nike. In your world, as an HVAC company, I don’t care how long you’ve been in business, it’s great as a credibility checkpoint, but it’s not the first line of offense that you’re putting in front of people. You are it.

When I sold that $500,000 remodel project, we were 20% more than everybody else, but the client said, “You got the least amount of experience and you’re the most expensive. I believe that you care the most and you will be the somebody I want to work with for the next six months while we execute this large project.” That’s me and we were going up against some 60-years old companies in Charlotte. We were a few years old and with no experience in a project of that size, but they wanted it because she trusted Mike Claudio. When Mike Claudio went from remodeling to roofing, everybody still hired Mike Claudio for whatever they needed because he had built a reputation. You’re no different within your HVAC company. A technician could jump companies and not lose a single client because they believe in that technician.

We say it happens all the time in the industry.

Be incredibly more focused on the name on your back and the name on your chest. I think it’s incredibly more powerful and people buy into that. Why would I hire you? You’re going to hire me, not my company, not the products. To be fair, your equipment and products are not competitive.

They’re all the same.

You’re saying, “Why don’t I hire you?” “You’re hiring me, my name, who I am. You would hire me because you believe I am the best to execute your project effectively and on time.” You can tell that story effectively. You will win way more than you’d want to date if you’ve been focusing on the brand, the background, the integrity, and all that. People don’t matter. People don’t care. Every day, either write down, do a video, or sit in your truck. What is the biggest lesson you learned that day? What is the biggest problem you solve that day? If you tell that story every day, you will never run out of content because you solve different problems for different people every day.

Thank you for that insight. I know that there are people all the time. That’s one of the biggest topics. it’s increased because the phones aren’t ringing. Either they’re not ringing quite as much or if companies have been making this content. I was talking to a guy and their company had almost $300,000 in sales because they have been putting out this massive amount of content for the last months of, “Here’s what we’re doing.” There are pictures all the time. “Here are the concerns these people have,” and they show all the time with masks and gloves. They’re talking about, “Check out this cool ozone machine we put in every single vehicle we have so all of our tools can get sanitized between calls.” For the last months, they’ve been building that and people know, “If I’m going to have a safe visit from somebody, I’m going to call these guys because they’re the ones doing it.” It’s 100% proving out in a conversation I had.

You have to do it consistently. That’s the bit where I think a lot of people get hurt in general is like, “It’s worse to start and stop than not start at all.” If it looks like you’ve had 2 or 3 weeks of activity and then take 2 or 3 months off. People think you went out of business. Once you start, it doesn’t need to be every day, but it has to be the same cadence. When you create a social media structure or content tree, I’m going to have the same cadence or the same schedule every week. I’m going to have this post on Monday, this type of post on Wednesday, this type of post on Friday. Your audience gets used to the cadence of seeing you and if you miss a day, you’ll have people be like, “I didn’t hear from you.”

It is like, “What’s going on?”

That crap happens regularly if I missed something.

Once you establish a good cadence online, social media starts to get some awareness out, start to get top of mind, start to develop a fan base, and build an audience of people who are starting to know, like, and trust you. That’s always been called the living room effect. That term got coined back in the ‘40s and ‘50s. When TV was first coming out, all the stars would start complaining to their managers, producers, agents, and stuff like that. When people initially started, when they were in public, all of a sudden, they are stars and the whole paparazzi effect started to happen. They’re like, “These people keep coming up to me and acting as they know me, as if we had been friends forever.” In that case, that’s how that term got coined, but I am living proof of this at 100%.

I’m sure you have the same experience and anyone who consistently does content like this, especially doing Facebook Live or Instagram Live or videos, you will come across people. One of the tips that I always give and it’s super easy to do, everybody in our company has done it. Everybody I coach, we have them do it. It doesn’t have to be big or flashy, get some little background with your company logo or something. Record on your phone, make a quick video, less than a minute of, “My name is Sam Wakefield or my name is whatever. I’m excited to meet you. I’m excited to serve you. A couple of things to think about before our visit. I’ll be there in a little bit. It’ll be great to meet you.” It doesn’t have to be any more than that.

Even if that headshot can accomplish that relatability so that they know who’s going to be walking up to their front door, especially with the older generation. They are hesitant to let men into their homes. Give them that picture of a brief description of, “Can we see you later today?” would be powerful.

You can send a pre-made thing. It’s your picture and a quick bio or a little one-minute video. What we’re doing is we’re telling everybody, have it preloaded in a quick little YouTube link and when you make your pre-call, when you’re going say, “I’m going to text you this quick video or email it,” whatever they prefer. “I appreciate it if you watch that before I get there,” but what’s happening is they’re expecting you as you’re walking up to the door. More often than not, people open the door and say, “Sam, I recognized you from your video.” How different is that from back when you used to knock on the door and then they would have that hesitance of, “Who are you again?”

For the people that are saying, “I’ll never get my technicians to do that.” You can automate that process through some mailing campaign or Mailchimp or Constant Contact, where you can set up the automation of sending this email to these people on these days. They’re like, “I don’t think I’ll never get my guys to do that.” Take it to the next level. You can automate that process through a lot of other platforms.

ServiceTitan is a big company like the CRM process for the trades and that kind of thing. That program will do this for you. You have it preloaded. As soon as the dispatcher hits go, it sends to the people automatically. It is something you have to think about each time.

There are many great ways to connect our industry as a whole is behind professionalism, building a relationship with your client base that makes them believe and trust in you and know who you are and be able to refer you better. Is that video going to help you close more deals? Probably. What it’s going to do is help you get more referrals. Back to how do we get more leads? The way you make people feel at the beginning and end of your transaction is how they’ll remember you, period. It has nothing to do with how you handle it in the middle. You’d be the greatest technician in the world, but if you don’t say bye or you don’t leave something or you don’t thank them, they’re not going to remember you. It’s how you start, to initiate, and how you end is how you start to grow referrals from those people as opposed to, “I fixed your air handler well.” No one cares. I don’t know what right and wrong are, but they’re not going to know anything. It’s how did you make them feel throughout the transaction from start to finish, that is what makes them willing and excited to refer you to other people.

Successful Relationship Builder: Of everybody who will ever buy from you, only 6% are ready to make a decision right now.

Moving past that initial phase, this is something I think would sound like we need to make this a two-part episode.

I could talk for days on this stuff.

Pillar one, which is that it attracts. Pillar two is the sorting process, and qualification. Let’s cover that and wrap up there and maybe reset a second appointment to talk about pillars 3 and 4, if you’re okay with that.

The target was pillar two, identify the target. We’ll do qualify and then we’ll go back and do the second one for identifying. If you’re getting leads, how do you go about qualifying them? Some of that is through the way you message through your social media, what you’re saying, how you’re saying it, how you’re delivering who you’re helping, and where you’re helping. It’s something as simple as saying, “I got finished replacing a unit on a 5,000-square-foot house on this side of town or in this neighborhood. Let those people know that you work in their neighborhood. Let other people know you don’t do cheap work.” It’d be qualified out the people who are conscious of price, which is good for us. It qualifies you and people are like, “He’s done work on a house my size. I can trust him.” People don’t know. People are hesitant to hire service companies because it’s difficult to identify who’s going to take advantage of you and who’s not. The bottom line is there are people in our industry that screw people over every day.

The client is concerned with that. The first step is your passive, what I call outbound qualifiers, which is how you tell the stories of what you do and who you help. It does subconsciously help people identify themselves. When you tell that story well, when you do a good job telling the story on what you do and how you do, the ideal clients will see themselves as a character in that story, which makes them feel more confident in being helped by you. It’ll help the not-so-ideal clients identify themselves as not a person that you’re interested in helping. Do you qualify out some people you might’ve been able to help? Yes, but do you qualify in a lot of better clients? Absolutely. I’ll take that swing any day of the week. When you’re asking questions over the phone, it’s how are you qualifying them once they identify themselves as somebody who’s interested in your service? If it’s an emergency call, that’s a little bit different. I’ll be honest, I’ve never been in that world. I have not been in the emergency service world for HVAC plumbing or electrical. Most of the stuff I’ve sold has been elective. It’s a little bit different because there’s more of a process to it.

There are three things that I think make or break a client transaction that you can uncover on the first call. It’s how transparent they are. How flexible are they? What is their geographic location? There’s a number of ways to uncover that. Part of it is understanding, do they have a budget? Do they not? Do they have relateability? What is it going to cost? Do they agree to a range of fees before you come out? Do you have an inspection fee or a trip fee that they’re willing to abide to? If you’re not charging at least a minimum trip fee, you need to be. I know most do, but if you’re reading and you’re saying, “No, I’ll go out for free.” You’re the reason you’re getting crappy clients, but if you can understand, do they want to be transparent on what’s going on? If they’re like, “I don’t know what’s happening.” One of the best questions I’ve ever asked is what problem are you hoping to solve by contacting me?

When you relate what you’re doing to a problem they’re experiencing, it becomes less about the cost of it and more about the value of it. If you’re saying like, “My mother-in-law moved in and she’s constantly freezing cold.” The difference between $500 and $750 for that is nothing compared to making her mother-in-law comfortable. It’s how you make them feel? If you can uncover the question of, “What problem are you hoping to solve by calling us?” They’re like, “Can you come out and look at my stuff? I want to understand better what’s going on. No, come on out.” That’s someone who’s not transparent. They do not want to communicate with you. If you can’t get them to communicate proactively over the phone, what are you going to sound when you invoice them? Are you tired of taking money? It’s going to be terrible. How flexible are they then? “I need you to come out.” “When our next technicians available three days from now.” “I need somebody now.” “I’m sorry. We don’t have anybody available.”

If they’re not willing to be flexible to your timeframe, inflexibility shows me that they’re not going to be an easy client to work with. Is that 100% accurate? Nothing in sales, in any industry with any client is ever 100% the same way. You can say the same thing to ten people and get 7.5 different reactions. Don’t what if me or but me. It works the majority of the time. I get that a lot. “What about this one client I had years ago.” Stop. When I talk about best practices and sales tips, I talk about the middle 75% to 80%. The top 10%, the bottom 10%, you can’t make decisions around. They are so far irregular. You have to focus on that middle 70% to 80%. There are always anomalies, but that works the most often. When I ask questions, if I don’t feel that they’re being transparent and flexible or they’re not in a good geographic location for me, that I can’t effectively manage my existing client base and get to them in a timely fashion to deliver the client experience I would want to deliver, it’s not worth doing it.

Here’s the part that I think a lot of people underestimate. When someone calls you specifically in a reactive environment, like a service company, they are not always looking for you to solve their problem. They’re looking for a solution to their problem. If you tell them, “For what you’re looking for, we typically range between $1,500 to $2500,” you will get a “That’s way more than I thought it would be.” “Why don’t you call these 2 or 3 other people and see where they’re priced at?” “I believe I’m competitively priced and if you find someone way cheaper, by all means, give us a call back if you don’t.” Be okay doing that. I’ve always used the same example. If someone went to a real estate agent and said, “We have a $300,000 budget for our house,” and that real estate agent showed them every possible house they could around $300,000. If that person couldn’t find something that they wanted, they’ll change their budget.

It’s not your job to meet a client in an inaccurate budget. If they have an improper expectation of what they’re solution’s going to be, that’s not your job to meet that. Not because they’ve been watching DIY Network and HGTV and think for $700 because on that Flip House that one time, they only spent $700, but it’s a $7,500 replacement cost. That’s not your problem. It’s your job to maintain your business profitability. It’s not your job to maintain improper cost expectations on the client side. I’m all about letting them go and look around and if they come back, great, then I know I have them.

It is such a good conversation. I’m glad we’re having this because as we all know, in any trade, any construction, or anything, that’s the trap that about everyone at some point in their career gets sucked into of thinking that you need everyone who knocks on your door, rings your phone or send you an email. We don’t need everyone. We need people. We don’t need a person. As you’re saying, they’re like, “We’re doing a great job of creating the right message and the right idea of who we are and the problems we solved.” It’s not about a product. It’s not about, “Here’s my brand.” It’s not about this one type of air conditioner. It’s a two-stage and that’s what we do. Who cares? It’s about solving the problems. If we communicate that effectively, we’ll have more clients than we know what to do with. We’ll be able to grow and scale in a way with the right margins and the right profitability, not because we have a bigger volume.

The biggest thing is I think we all experienced this. We’ve all gotten the calls of, “Thank you for answering. You’re the fourth person I’ve called.” We’ve all had that scenario in some way, shape or form. Giving them the opportunity to call their people and realize they’re not responsive makes that little bit extra. They’re going to pay you a lot worth it because they know you’re going to be reliable. The price went up.

Successful Relationship Builder: The way you make people feel at the beginning and end of your transaction is how they’ll remember you.

“Nobody’s going to come back to me.”

“Anybody else? Did you try that?” There’s a certain balance there. There are certain times you have to give money back or a discount because you screwed up. There are certain times that supply and demand require that you increase your price a little. I’m not saying, to gouge people. Don’t get me wrong here, 5% or 10% or a few hundred dollars to something because there are plenty of times you have to drop your price because of things you’ve done wrong. It’s a business. It is supply and demand, quality and control and you got to stay profitable. If you’re willing to give people money back, sometimes you have the willing to overcharge some people sometimes. Not overcharge and not gouge, but above what we would normally charge for something.

It’s the market. There are times that every single industry in the world does this. That’s the reason anybody has a sale is to incentivize people to move forward. They may need that extra bump on their books or anything like that. That’s the reason for discounts, but I 100% agree. There’s something on the other side of that that most people are scared to talk about truly is when it’s peak season, does the price go up a little? More importantly, do you stay at the price you should already have it priced at and not give additional discounts? That’s how to do it with honesty and integrity. We’re not increasing the price because it’s busier, but it’s foundationally a great way to do this everyone is set a standard price, that is, “Look at your entire year on the busiest time of the year, the peak season.” You’ve got craziness going on. What would you want to be able to charge? Set that as your standard all the time price. The way you can control it the rest of the time is figuring out ways to offer sales or discounts or those types of things. Maybe instead of reducing your price, which you can do because it’s always more profitable this way, including another item or two. Maybe a couple of accessories you’re offering with no extra charge. You’re giving them extra value.

It was significantly better than discounting. I rather increase the value of a service for the same fee than decrease the cost of that service. When you do that, a number of things happen. First off, it shows you don’t value what you’re doing so that makes the client not value what you’re doing.

You Don’t Ask For A Discount At The Ferrari Place

What happens also is you get into the discount cycle where you have to, because a lot of people are waiting for the next deal. Here’s somebody who every other month is offering a discount. Why would someone not wait another month to get the lower price? You have to discount to get people to make decisions. I prefer adding value to the baseline service than discounting the baseline service fee. My opinion is to do that as you want, but discounting services, it’s a rabbit hole that you don’t know when to stop and eventually you’re rubbing nickels together to get by because you’ve got yourself into the ground.

Specifically, in the HVAC industry, that’s one of the biggest topics is slow season comes around and you have all these companies. They’ll start knocking the bottom out of the price to get the job when we all know that they are paying the client to work for them. That project is in the red because of where the margin landed to earn the project. That’s not doing anyone or any of the other companies or themselves any favors. I do agree. If you can’t be the cheapest guy in town, which you never will be, be the most expensive and offer more value.

We should have a second one. That was a good episode. We should hit a second one on the other parts of what I think is important because I can talk for an entire hour about how to run an in-home consultation.

Before we wrap up here, for everyone reading this will be part 1 of a 2-part series that we’re going to do with Mike Claudio of WinRate Consulting. There are a couple of places where you can find him. Where can they find you, Mike?

A few places. I would say Instagram’s @WinRateConsulting is where one of my primary content sources are. I also host a podcast called Big Stud Sales. It is an industry-specific sales market, getting a leadership type podcast. I also run a private Facebook group called Construction Selling. It’s best practices, tips, and tricks about in-home construction sales. I love to have you guys join. You have to submit to join, but it’s a free group. I rarely post, but there’s a little over 700 members. There are always people talking and asking questions about different sales stuff. Ultimately, I think it’s a great group for people to get information about what you do every day and how to do it a little bit better.

If you are on YouTube, I also host the Close It Now podcast. You can find it as well, and that’s a little more specific to the HVAC industry for residential in-home sales. As we were talking about, the philosophy is the same. All of my people who read the blog, find Mike, Big Stud Sales. Everyone subscribes, follows, and do all the things. Let’s help him grow his business as well. If you need overall, I am sure that Mike would be willing to do a discovery call with any of the business owners, or entrepreneurs wanting to grow your businesses because he hasn’t specifically worked in HVAC before, does not mean that every single thing that he’s talking about is 100% applicable. That’s why I bring in people from other trades and other industries because if you want to get down to it, the HVAC industry is old and boring and everyone has done the same thing for too long and it’s stale. It’s time to bring in some new ideas and concepts from outside of our industry to bring it some new life and pump it back up. There’s no reason you can’t dominate your market especially with everything going on.

We’ve been talking a lot about virtual sales. We’ve been doing all kinds of different ways to do no-contact appointments all the way from sales to service to installation. You could do every bit of that, no contact, you don’t even have to be in the same part of the house. Individuals wear protection and people love it because it’s how we care and how we make them feel. People don’t care how much you know until they know how much you care. That is what happens every single day. Thanks, Mike, for being on this episode. We’ll reschedule as well for our next one. Go and save the world one heatstroke at a time. Save the world one frostbite at a time. We will talk to you again soon.

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About Mike Claudio

Hi, I’m Mike Claudio.

I have spent the last 14 years not just selling products but learning how to go out and actually develop a business.

My sales and management career started in retail with Verizon Wireless before working in their enterprise sales. During my time in Corporate America, I was given some of the best training in the world and really developed an obsession-like energy for communication and the client experience.

While my formal training is in the corporate setting, I’ve always been pulled towards smaller companies where I could work with entrepreneurs to help them bring big changes to grow their businesses.

I was a great salesman, but I found my love and passion for the people, processes, and services of the construction industry. When I was given the opportunity to work with New Leaf Construction, a residential general contracting business in Charlotte, I jumped at the idea of using my experiences and training to help create a sales and client management system specific for this market.

Over two years working with New Leaf Construction, both as a salesman and as their construction sales consultant, the company went from doing a couple hundred thousand a year to well over $1 million a year. While I can’t take 100% credit, I was able to bring the brand awareness and business development growth that brought New Leaf the bigger, higher-paying jobs the owner was looking for.

After helping lay the foundation at New Leaf Construction, I set out looking for new opportunities with construction companies with even bigger growth plans. I was lucky enough to land with Daniel Enterprises, a commercial and residential roofing and siding company, where the owner’s visions for growth aligned very well with my skill set. In my first 12 months with the company, I was able to bring in over $2 million in sales and helped the sales team to more than double year-over-year. As of June 2018, Daniel Enterprise is quickly approaching the $5 million mark, already doubling 2017’s $2 million in total sales.

I have proven my system and processes to Identify, Target, Qualify, and Acquire clients work. With a heavy focus on communication, follow-through, and follow-up I believe any company can increase sales and profits and I want to be the one to help you do that!