Three-Tiered Service Options are Killing Your Sales

Hey 👋 - Brandon here.

Happy Saturday to 1,410 growth-minded accountants.

Here’s one growth tip for you and your firm.

Today’s issue takes less than 8 minutes to read.

If you present three service options during a sales call…

I have bad news.

It’s costing you money.

We’ve been told the three-tier pricing system enhances your practice by enabling you to productize your services and price them better. Three tiers often appear as “bronze, silver, gold” or “basic, plus, pro” service plans. And I believe this to be true - a three-tier pricing system is superior over hourly rates and menu pricing.

But based on ~3500 sales calls we’ve held with prospects over the past two years, presenting three options can:

• Give prospects analysis paralysis and turn them away

• Prompt prospects to purchase the cheapest option because they don’t understand how the service levels solve their needs

Purchasing professional services is more complex than an SAAS product

Professional services requires a more sophisticated purchase decision than, say, a SAAS product.

SAAS products are easy to trial and move between plans fluidly as business expands and contracts. And it’s relatively easy to understand what features are needed to enable their business.

SAAS companies should present three tiers of service.

But SAAS companies are order-taking. Buyers of SAAS products can generally make a purchase decision without needing to talk to a sales rep. A consultation is not needed.

Professional services are quite different.

When someone shops for professional services, they rarely understand what level of service they need to enable success. They don’t understand the difference between bookkeeping and outsourced CFO. They don’t know why they should opt into quarterly tax estimates. They aren’t sure they need dashboards or written tax plans.

They are trying to buy something that is difficult to understand.

And when you present them with three service levels, they lock up. They take no action or they take the cheapest option so as to reduce their risk in the buying process (leaving you frustrated because you KNOW they needed the highest service level).

Stop taking orders, start selling

When you jump on new client consultations (sales calls), are you just taking orders?

You know you are if your calls generally flow like this:

• Intro/rapport building

• Ask the prospect question about their income streams, entities, and processes

• Present three options and all of their features

• Try to justify with an ROI (tax savings or time savings)

• Ask which option they want

If this is you, you’re running sub-optimal sales calls and it’s costing you money.

A great sales call focuses on the prospect. You explore their goals, their needs, why they are trying to solve this problem today, why can’t they do it with their current CPA, what are the one or two outcomes that if you delivered it to them it would be a no brainer to work with you, and what does life look like if those outcomes are achieved.

And then you present the ONE option of your three that they need.

(Yes, you SHOULD have three options but you should only ever present the one that best fits the prospect’s needs)

If you know what plan they need, why would you give them a choice?

If they choose a cheaper option, you will either work for free or the relationship will sour because the client will need more of your time than your service tier allows.

Feedback I hear when I present this is “but sometimes our clients opt into the highest plan when they didn’t need it!”

Yes, those types of buyers exist.

But you know what the majority of buyers do? Reduce risk by purchasing the cheapest option, even if they needed something more.

Present one option that the prospect must take or leave

Developing three service tiers is a step in the right direction and upskilling your sales ability is the next level.

When you propose one level of service and talk directly to the prospect about how this service will solve their needs, deliver the outcomes they are looking for within their timeline, you will close more deals and more consistently.

The prospect will feel heard and you’ll have more success fulfilling their needs.

This change increased our sales close rates and I believe (though can’t prove) it plays a major role in our high NPS scores - clients are getting the services they truly need to succeed.

That's all for this Saturday. See you next week.

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See you again next week.

Cheers,

Brandon

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