David R. Evanson
Privately Published, Fall, 2004
Selling 101 suggests one of the key ingredients for making a sale is gaining the trust of the prospect. Unfortunately, this can take a lot of time without any assistance. Courting over the telephone, follow-up correspondence, a meeting, maybe two or three meetings and perhaps even a lunch are all part of the drill.
Organizations and sales professionals often try to compress the process with tactics designed to plant a kernel of trust in the prospect beforehand and as a result, move the sales process a few steps ahead all at once. Some tools that are commonly used include well placed advertisements, publicity, a physical presence in a market or geography or a personal referral.
And of these, most sales experts will suggest that a referral is the most effective. Why? Because the person making the reference is staking their reputation on it. For sales professionals, the one drawback to referrals is that it’s often challenging to make them occur on a consistent on voluminous basis.
Or is it?
Not when affinity based marketing is used. There’s lot’s of examples of affinity marketing. The most common are credit cards. A large group – such as AAA, or a union, or a charity – offers a special card to its members. The members accept the offer more readily than they would a blind offer coming in through the mail because of the trust they have in the group they are a member of. ‘Surely if Triple A says it’s good, it must be . . . .’
The same process can work for selling loans too. That is, loan officers or brokers can develop relationships with a wide variety of organizations that will result in a consistent flow of referrals and prospects.
As a typical example, consider a lender in Wisconsin who develops a relationship with the Door County Dairy Farmers Association. Although this doesn’t seem like a pathway to success, a closer look reveals several advantages. First, dairy farming is capital intensive. Equipment and facilities expansion can rarely be funded by net cash flow, but instead must be funded as a large scale capital project. Second, dairy farming is a technical discipline. A lender who masters the ins and outs of dairy farming gains specialized expertise, which commands the respect of his or her clients and quickens the pace of referrals. Third, the regionalized nature of this relationship may enable replication in other markets. That is, once a lender has honed his or her approach to this particular market, then he or she can approach regional groups.
Follow The Yellow Brick Road
Given that opportunity for affinity relationships may lie in the most unexpected places, the first step in the process is to get an idea of the associations or affinity groups that meet in your area. Here is the best way to do this:
First, you’ve got to find the trade groups. The Directory of Associations, published by the Concept Marketing Group (www.marketingsource.com) publishes an annual directory that lists contact data on 34,000 U.S.-based trade groups. The directory is $595 on a CD Rom. Since you may only want groups in your immediate regional you can do searches on an a la cart basis.
A free but less reliable way is to search the Internet. For instance, the link to http://dir.yahoo.com/Business_and_Economy/Organizations/Trade_Associations/
will produce a fair number of trade associations, but they will likely require some additional legwork. For instance, some of the national groups you can find there – such as, sticking with our food example, the National Food Processors Association – may require a telephone call to see if there is a chapter in your area.
Finally another source for finding local trade associations is the nearest Chamber of Commerce. Talk to the executive director, tell him or her what you are trying to do, and see if they don’t produce a list of groups and contacts.
Walking the Walk
As much as anyone is sales wishes that there was a silver bullet out there for developing new business, this is not it; at least not immediately. You can earn a handsome return on your investment, but you must invest up front for a prolonged period of time before you start to earn your rewards.
This should not be terribly surprising. After all, what is it you ultimately seek from an affinity group? Nothing less than their trust on a wholesale basis. The vital difference is between gaining the trust of a group versus an individual prospect, is that your investment in the former will pay off over and over again, if done correctly.
That said, there is no precise approach to developing an affinity relationship. Here are some steps and guidelines to keep in mind.
Budget Real Dollars For Your Relationship. Trade groups, particularly regional ones, always need funds, and there is nothing that can break the ice faster, or set the stage for a trusting relationship, better than cold hard cash. You can’t buy trust, but you can buy the opportunity to develop trust. Therefore think about how much you can spend with your targeted group on hard costs such advertising, event sponsorships, dues as well as soft costs such as catering, availing your facilities, or providing helping hands for events.
Budget Real Time For Your Relationship. Affinity marketing does not mean focused advertising to a trade group. To develop the trust you want, you’ve got to invest the time. That means getting religious about attending monthly meetings, putting in some face time at regional or national conventions and attending some of the special events, such as mixers and social outings. Remember, nobody does business with a newsletter ad or a tradeshow banner that says Sponsored By . . .
Sell Using the Anti Sell. This is counter intuitive, but the key to developing a long term relationship that will repeatedly deliver leads can be summed up in two words: don’t pounce. Remember you are in this for the long haul – years and years – so whether you make a sale in the first six months is almost irrelevant. You will make your first and best sale when a member with his or her back really up against a wall comes to you looking for a solution. Imagine the marketing value when your new client says to other members of the trade association, ‘We were in a jam, and honestly, I didn’t think anyone could get a loan done that fast . . . but he really went to bat for me.’
Said differently, imagine the damage done when the buzz becomes, ‘He really tried to jam that loan down my throat.’ In the same way that thoroughbred owners actually lose races to increase the odds, and ultimately the payout down the road, you almost want to turn down business at first so you can really go to work later on in the relationship.
These rules of engagement should make it clear that affinity marketing is not for everyone. And as a corollary, do your due diligence up front. Make sure that the group you are targeting has members that will require the kinds of loans you are equipped to make, both in size and in character. Your time is far too valuable to get anything less than a multiple of what you put up in terms of your time, effort and energy.