How To Sell A Service Instead Of A Product

by Tom Egelhoff

There is a common misconception in the world that the world's oldest profession is prostitution. I would like to correct this bit of misinformation. The worlds oldest profession is, in fact, selling.

Even the "ladies of the evening" made a deal before any goods or services were dispensed. Nothing happens in business, or anywhere else in life for that matter, until someone sells something.

The two types of products most often sold are tangible and intangible. Tangible products are products that we can touch, taste or see. intangible products are products the customer can't touch taste or see.

We are here to talk about the latter group...the intangible products that are usually sold as a service.



What Is An Intangible Product?

You don't have a product that your customer can see, touch or taste. The most common service professions are insurance and cleaning services. Life, health, homeowners, and auto insurance require payment for something you hope will never happen.

The only tangible item you can hold in your hand is the policy itself. This is a piece of paper that represents the unseen service.

In the case of the cleaning service -- there is rarely any paper that represents the service provided by the cleaning service. However, after the cleaning service has been completed there is no tangible product left behind.

Top : Home



How Customers Decide

If you read a lot of the articles on this site you will think I'm a broken record. People buy based on emotion not by logic. They would like to have you believe that they sit down and logically compare a product's features and make a logical decision.

What actually happens is.. they make an emotional decision and create a logical argument to justify the buying decision. Now, accepting that principle how does a customer make a buying decision when selecting a service?

Something that can't be laid out on a table side by side for a comparison of the features and benefits?


Top : Home



Why Should A Customer Buy Your Service?

Before you can sell or present your service to a customer you must have an understanding of the selling process. You need to understand the process of why customers buy the things they do. See: "Why Customers Buy."

Customers buy your service because they expect one of the six benefits explained in "Why Customers Buy." If one of more of those benefits are there most likely you will have a sale.

If you don't you will probably lose the sale. But there is an even more important aspect of the selling process. And that is....getting the customer to contact you in the first place.


Top : Home



The Other Intangible You Have To Sell

Service businesses have an additional burden and that is they not only have to somehow sell a service that the customer can't see, taste or feel.......But they must also convince the customer that they can perform the service to the customers satisfaction better than other similar services.

Suppose you have a lawn care business. If I have an average lawn that I take minimal care of I may only be interested in the lowest cost for cutting the grass.

I might hire a high school kid to do it. However, if I'm very serious about my lawn and how it looks I may be more particular in who I hire to take care of it.

I also might be willing to pay a little more for an actual business to do the work. But by the same token my expectations are going to be much higher.

If I'm your customer you are going to have to be prepared to convince me, not only that you can do the job, but you are going to do it to my expectations or better for the same or less money than the competition.


Top : Home



How To Sell Service Pricing

Notice in the above paragraph I said I wanted to pay the same or less as your competition is charging. Here is where many good service companies drop the ball.

Because they are unprepared to justify a higher cost for better service, they often end up giving away services that they have every right to charge for just to meet the competition.

Your service has a certain value in the minds of potential customers. If I mention CD player a price usually pops into your mind. $$$.00?

If your price is higher than the competition then you need to be able to show the customer that the additional money is justified.

If you are charging for services that are not seen as a benefit by the customer then drop those services from your bid or explain to the customer the benefits of the extra service.

The customer may not have realized they need the extra services.


Top : Home



Building Customer Confidence

I'm sure most of you are aware that it takes six times as much to acquire a new customer as it does to keep an existing one. The existing customer knows your systems and has a first hand knowledge of the quality of your work.

The new customer, on the other hand, must be marketed to, advertised to and eventually sold.

But first the customer must call or contact you. How does that happen? Why should I call you instead of or in addition to your competition?

Top : Home



Image, Image, Image

As a customer I want to feel that I'm dealing with a reputable company. How do I know you are reputable? One of the simplest ways is....I've heard of you.

I've seen your company name advertised or I received your name from a friend.

A referral from a satisfied customer is the most powerful advertising you can get. It will, in many cases, eliminate the need to sell the company to the customer.

You can go straight to the services you offer.

Top : Home



Low Cost Promotion of a Service

In a small town, promotion is essential. But it's also much easier in a small town than a larger city. For example, the customer base is smaller hence the numbers you need to reach is smaller.

In addition, advertising costs in small towns are usually must less than they are in larger cites.

And last, but certainly not least, you can make an immediate presence in a small town. How?? Get involved in the community. Join the chamber or commerce. Join community groups... Kiwanis, Lions, or Rotary...just to name a few.

Attend the church of your choice regularly. Become comfortable talking to and meeting people. If this is hard for you start by saying Hello to one stranger every day.

When you are comfortable with that then say Hello and comment on the weather. As your confidence builds add to the conversation.

Always carry business cards with you. Put a business card in all local bills you pay. They should be in your car, wallet or purse, office and home. Anywhere YOU are.

You should never be further than walking distance from a business card. Speaking of walking distance....everyone within walking distance of your house or apartment should have your business card.

We like to support our neighbors. Go door to door, introduce yourself and give out your business card.


Top : Home



The Last Word On Selling Your Service

As we have seen, selling a service has some challenges to overcome. The most important thing to remember is that customers want to deal with a reputable business.

Just because you walk the neighborhood with a lawn mower doesn't' make you any less reputable than IBM.

Project the image of success. In Montana we are open shirt collars and blue jeans. Nothing wrong with that but we wear clean jeans and pressed shirts. You don't need a coat and tie to be a professional but you should project a professional appearance.

Before you leave home each morning, look in the mirror and ask, "Would I do business with this person??" If the answer is yes.......go get em!!


Top : Home








Top : Home




Quick Links
Tom's Self Help Books