MICHAELJ. WEST ANDDIANAL. GARREN
Michael
When I first started out with the idea of opening my own agency, I thought I knew something about business. I was so mistaken. Little did I realize the nuances involved in so many aspects of the business and how many hours I would be working every day.
Diana
What Michael just said is so true and indicative of entrepreneurs.
Many people open their own agency because they love the work they do and are skilled in investigations. They feel they have what it takes to make a business work. They also want to be their own boss and call their own shots. What many do not realize is that to be successful when they open their own agency, they must transition from being a private investigator into a business person who provides investigative services.
Conducting investigations and building and operating a viable busi-ness are two different things and require different skill sets and knowl-edge. To be able to conduct investigations and run a successful busi-ness takes much more time than just conducting investigations. To
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(Editor’s Note: The information in this chapter outlines the efforts Mr. West made to market his pri-vate investigation company into the highly successful business that it is today. The commentaries of Ms. Garren substantiate and further explain the strategies used by Mr. West.)
have a successful agency they must be 100 percent committed and willing to put in twelve to sixteen hours a day, five to six days a week, and sometimes seven days a week. They must be prepared to do what-ever it takes to get it done. Without doing so, they will shortly learn that what they have really done was buy themselves a job, and prob-ably one of the lowest paid jobs they ever had.
Michael
Marketing your business is plain and simple. It is an attitude.
First, let me give you a perspective of what I thought marketing was.
When I first convinced myself that I was going to work for myself instead of drawing a paycheck every month I decided to learn from other people. I told myself that I should listen to other people who have done this before and are a lot smarter than I am. This was an opportunity to do what I always wanted to do, but I’d need to take the advice of others for a change. My plan was to find someone who had been successful in the business and follow his or her lead. I found someone who would help me get started. I ultimately found that he was exceedingly helpful and knew what he was talking about. Without his help I would never have gotten started on the right foot. Now, mind you, he did not have all the answers, and I now do some things differently than I did at first, but I am truly grateful to him.
My first rendition of things necessary to start out in the business was so very far off base that I now laugh at some of the things I did. To explain further, when I hired the consultant, he asked me to send him copies of all of my advertising and promotional items. He wanted busi-ness cards, letterhead, envelopes, brochures, giveaways, and anything else that is used to advertise or promote the business. I did just that, and a week later he called me for my hour-long consultation. Over the years, I have concluded it was the best money I had ever spent. By the end of the telephone conversation I felt dejected, rejected, and com-pletely out of touch with what I wanted to do.
My goals from the very beginning were to be a cut above other investigators. I realized that there were many investigators who were very good, but they did not know how to position themselves. It was my intent to use that attitude to my advantage.
During our hour-long consultation I realized how unprofessional and unrealistic my approach was. For example, my initial logo was an
outline of the state of Arkansas with the proverbial “spy in the trench coat” superimposed over it. In retrospect I cannot believe I did that.
Nevertheless, it was what it was.
I had also provided him with a promotional writing pen that I used as a giveaway. Now that I think back, I had provided a really cheap pen that no one would want to use, much less keep. He took a look at my brochures and recommended that I obtain a professional design and get over the concept of printing my own brochures on my office printer. He also gave me a couple of sage words of advice that I am really glad I listened to.
When we started our conversation, and remember he had all of my advertising material already, he asked me where my office was located.
I advised him that I intended to work out of my house and that was why I had the Mailboxes Etc. “PMB” mailbox address. He asked me to identify the most recognized building in the town I live. I told him, and he responded that as of the next morning I was going to have an office in that building. He did not care how much it cost, he did not care what I had to do, but, I was to get an office in that building. He recommended that I find an executive suite or virtual office area so that a real person would answer the telephones and greet clients. I took his advice I found an office the next day, and I have been there since.
Diana
Michael was very smart in reaching out to others who had knowl-edge based on experience and success and even smarter to follow the advice he was given. Your business image and reputation is one of the most valuable assets you own. It can make or break your business.
How your market perceives you and your business will dictate the level of success you achieve.
The number one thing that has been shown to undermine the cred-ibility of a business is inconsistencies. Look what happened to Toyota in 2010. They will spend billions trying to win back their reputation of being a “reliable” car manufacturer and to gain the public’s trust back.
Consistency is key! With everything you do, strive for consistency. Be consistent in the look, feel, message, and quality of your materials, communications, and work product. As Warren Buffett says, “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.”
Before developing or revising your sales and marketing material be sure to properly identify your market—not everyone is your market—
then build your business image and brand to align with the market you want to capture. Private investigators often think and/or want to look like “PIs.” For instance, Michael’s first logo was the “spy in the trench coat.” This is the image television created for the private investigator, however, it is not the image attorneys, insurance adjustors, and busi-ness professionals look for when hiring a private investigator. They are looking for professionalism when hiring a private investigator. They are not looking for the spy in the back alley. They do not care how you do what you do. They care about the results of your work.
Attorneys care about winning their cases. They want a private inves-tigator who can not only conduct a thorough investigation but also pro vide them a concise, well-written report and be credible to their client and on the witness stand.
Now, if your market is the general public, they might be drawn to the “spy in the trench coat” or “the bounty hunter” image. The image you choose for your agency should not be based on what you think or what you like. It should be based on what your market wants.
Another common mistake made on a regular basis is the text in brochures and on websites. When people are new in business, they have a tendency to create a brochure and/or website that tells all about them and the services they provide.
First, people do not buy services, they buy benefits. You might be ask-ing what the difference is. A service is just that, a service. It focuses on what you provide. A benefit is what the prospect will receive from the service you provide. It should evoke a positive emotion and create a desire within the prospect to want what you provide. It has to be about them. People are tuned into the WIIFM station (“what’s in it for me”).
So it is important to talk about what is in it for them instead of what you do. For example, the service could be a background check. The benefit would be to decrease employee turnover and increase profit margin.
Second, prospective clients do not care about who you are until they know you can provide something they need.
Third, prospective clients do not care about your past accolades.
They want to know what you can do for them today.
To create effective marketing pieces, the focus needs to be not on you and your business but on your client market, their needs, and how
you can fulfill those needs. This takes knowing and understanding your market.
Michael talked about marketing being an attitude. Part of marketing is an attitude. Marketing is not a cut and dry issue. It is very complex.
There are many ways to market. Shotgun marketing is always a waste of time and money. Effective marketing should be planned and exe-cuted with a specific message to a specific demographic. The real atti-tude should come into play concerning your overall business image, in other words how you are perceived by your clients and your mar-ket.
Just about everything in life is about presentation. When Michael was giving away cheap pens, printing his brochure and probably busi-ness cards off his computer, it sent the message loud and clear to everyone he came in contact with that he was either struggling or cheap. Guess what, people do not want to do business with struggling or cheap people. This does not give them a sense of security and fidence. People want to hire successful people. They want to feel con-fident in those they hire and know that the job will be done properly and professionally.
Michael
The second bit of sage advice my consultant gave me was after he asked me what the prevailing rates were for my competition. I told him what I had been able to find out, and he advised me that as of that moment my rates were 10 percent above the highest competitor rate I could find. No matter what they raised their rates to I was to make mine higher. Clients perceived that higher rates meant higher quality.
I did it, it is true, and I have maintained that philosophy since day one.
I recently had a University of Arkansas study completed that vali-dated that I was the highest. If I have heard it once, I have heard it a hundred times. Clients have remarked they feel that “you get what you pay for.” This is also why I go “above and beyond” when provid-ing customer service. I answer the phone twenty-four hours a day.
When they call, I respond. This is why I cringe when I hear about peo-ple “low balling” or undercutting prices. You are only hurting yourself.
As a matter of fact, I took all of his suggestions and reduced them to a single-line entry on a piece of paper. I still have them today as a guide-line. I am confident that without his guidance I would probably have
failed the first year. It was not that I was any better or worse than my competition, but as you will learn in this chapter most of your suc-cesses are a result of perceptions that are held by your clients.
Diana
What Michael is saying is true. If you are seen as expensive but worth the price because of excellent work product and great customer service, then people will pay the price. If you are seen as cheap, then people will pay you very little. The problems with being cheap and get-ting paid very little are twofold. The problem that directly affects you is that you have actually priced yourself right out of business. Now that you own an agency, there are operating costs and overhead that must be paid. It is no longer “just getting paid” for the investigative work.
The second problem is when you low ball your price, you have hurt not on ly yourself but also your industry. Speaking of your industry, one thing that is keeping your industry from becoming a profession is low-ball pricing and the poor business image many agencies have.
According to the most recent Bureau of Labor Statistics1the “medi-an “medi-annual wages of salaried private detectives “medi-and investigators were
$41,760 in May 2008. The middle 50 percent earned between $30,870 and $59,060. The lowest 10 percent earned less than $23,500, and the highest 10 percent earned more than $76,640.”
When you look at these numbers you learn that 50 percent of inves-tigators only make between $30,870 and $59,060. Now, this money has to cover home and business operating expenses. Worse yet, the lowest 10 percent earn less than $23,500. Imagine splitting this pie between home and business expenses. These low numbers are
creat-Percentile 10 25 50 75 90
(Median)
Hourly Wage $11.30 $14.84 $20.08 $28.40 $36.85 Annual Wage $23,500 $30,870 $41,760 $59,060 $76,640
1. http://www.bls.gov/oes/current/oes339021.htm
ed and maintained because many in the investigative industry are low balling price. Until the majority of investigators know their value and charge what they are worth, these numbers are not going to increase.
Would you not like to be in the highest 10 percent and beyond where you are making $76,640 or more?
When you have cheap pricing it will not be long before you no longer like what you do. When you do not get paid what you are worth, it creates bad feelings and ultimately bad relationships. In the end, cheap pricing hurts all involved.
Now, as far as having someone answer the phone, this is critical. If clients are looking to hire a private investigator, and they cannot reach you, or their first impression is not a professional one, do you think you will get the work? Probably not. After interviewing more than 500 attorneys, 96 percent of them said that when looking for a private investigator, they first ask for referrals from colleagues; once they have some names, they go to the Internet to learn about the agencies’ cre-dentials and to see how professional they appear. If the website is not professional, they go no further. If the website is professional, they then call the agency. If nobody answers the phone, they move on to the next name on the list. Why? They want someone who is accessi-ble and reliaaccessi-ble. An unanswered phone does not meet what they are looking for.
Perception Creates Reality®. However you are perceived by your clients and your market will create the reality for your agency. Per -ception may not be the reality, but in the eyes of your clients and your market their perception is their reality. Agencies who fail to manage their business image will ultimately struggle and often fail. You are actually choosing how your agency is being perceived every day by everything you do or not do. The question is, are you making the right choices?
Michael
I tell you all this because I want you to have benefit of my perspec-tive when I first started out. I had previously had some experience in the private sector, but for most of my life I have been a badge carrier who worked for somebody else and drew a monthly paycheck. I had no real entrepreneurial experience even though I thought I did. I had no clue.
I sought out ideas and applied them. You can find some wonderful ideas and suggestions by listening to other successful people. You can find some great ideas by reading about other successful businesses. I like some of the ideas and suggestions in the Guerilla Marketing books.
Diana
Even though Michael was given good advice and followed it, it is important to point out that not all advice given or read fits all business models. There are many things that apply to all businesses, but not everything. For instance, if you provide surveillance and the general public is your main market you will want to spend money on advertis-ing in the yellow pages and on search engine optimization (SEO).
These are the avenues the general public utilizes to find private tigators. However, 96 percent of the time attorneys hire private inves-tigators through referrals. Attorneys will resort to searching the Inter net if they need a private investigator outside their local area. To know if the advice you read and hear applies to your business, you must know your business model and your market. You must also take into account that there is a great difference between marketing a product that every-one uses and a service that people do not have an everyday need for.
Michael
I did well the first two years and actually exceeded the goals I had lined out in my business plan, which brings me to my next point. I cannot overemphasize the need for you to have a good, thorough, lengthy, detailed, solid, realistic, and concise business plan. I pur-chased a software program that I used to develop the business plan. It ended up being much longer than I thought it would be and because it was my first attempt I did not know if I was including too much information or the wrong information. I took it up to the local univer-sity where they have a small business development center and asked them to review my business plan. I was actually surprised when they called me back informing me that my business plan was one of the most thorough they had seen and they wanted to use it as a model for their classes. Since that point I have used the small business develop-ment center quite frequently to feel out different marketing plans and ideas, and I have even taught a few classes there.
After I started teaching at the university, I fell back into an old, com-fortable pattern of years ago when I used to teach at law enforcement academies. I had been told that one of the best ways to meet new peo-ple who were interested in learning about a topic was to teach the topic. It turned out to be true. I have met a number of people who be -came clients and I have met a number of people whom I used as con-tacts as a result of this experience.
Diana
Diana