The Green Sheet Online Edition
July 7, 2009 • 09:07:01
Target portfolios for increased profits, merchant retention
How many times have you reached out to your merchant base and introduced new products? Are you concerned about how many merchants stay on your books these days? Have you adopted solutions that can help merchants increase sales and repeat visits?
There has never been a better time to reach out to existing merchant portfolios and cross-sell value-added and third-party solutions. Given the current economic conditions and struggling retail markets, it's a prime time to begin planning a campaign.
If your portfolio is primarily bankcard-based, you have an even bigger opportunity to begin developing a marketing strategy that introduces additional products and services aimed at helping merchants drive more business.
For some offices, reaching out to customers after the sale is a questionable strategy and may result in uncovering problems or receiving lower pricing requests.
Yet, uncovering such issues as you go along and making certain concessions is much better than losing the merchant to a competitor altogether.
Thorough preparation
Caution: Before jumping into targeting your base, it's crucial to have the right solutions in place along with a detailed game plan. Make sure you coordinate with third-party vendors and value-added providers to ensure resources are available to support the initiative.
Depending on the size of the portfolio, there are several ways to begin planning a campaign. If your base is large, a strategy may require more planning, while smaller folios can be easily managed and targeted with fewer resources.
Suggestions for larger folios include:
- Set up a meeting or conference call with your merchant level salespeople (MLSs), and get them on board with this initiative, making sure they are able to profit or share in the up-selling opportunity.
- Send direct mail introducing new products and services. Active MLSs can personalize these with their contact information.
- Send informational newsletters to help merchants reduce fraud and improve efficiency. Be sure to have an opt-out feature or use third-party solutions that can manage this process.
- Make quarterly calls to gather customer feedback and introduce new products. Be careful not to spam or send too many offers.
- Schedule an online webinar that covers support, training, compliance and other product offerings.
- Coordinate regional meetings with local merchants who may want to attend a small technology and new product show. Coordinate it with vendors and third-party providers, have booths and do short presentations on products.
Suggestions for smaller folios include:
- Reach out to each merchant individually if you can.
- Send a signed letter thanking each for their valued business and introducing other solutions that you think would benefit them.
- Attempt to visit merchants by appointment, if possible. Phone calls can help pique interest, and appointments can be scheduled accordingly.
- Send postcards or special offers via mail or e-mail if you have that capability. Make sure to use an opt-out system even if your e-mail list is short.
- Uncover and locate local service providers merchants might need. Send referrals to merchants and offer to set up appointments to review your services.
- Ask for referrals, which is another great way to get back in the door. When you get referrals, you can follow up with a thank you and mention other services at that time.
Thoughtful communication
Ongoing, proactive communication with merchants is proven to generate positive and profitable results. Each portfolio of merchants comes with its own challenges. Finding what works takes time, and if marketing initiatives don't produce results immediately, then it's back to the drawing table.
For MLSs who write through ISOs, it's critical these initiatives be discussed in advance, and that everyone is clear about their options and follow-up plans. Jumping into this can create issues that hinder productivity.
Some of the products below can be sold directly; others might just be simple referrals to third-party providers. Many will pay a commission to the referring ISO or MLS. Make your own list, and match its contents to different types of merchants.
Value-added and third-party solutions include:
- ACH, check conversion and guarantee services
- Gift cards, loyalty or rewards cards, VIP cards and preferred guest cards
- Coupon services and local advertizing
- Local radio and TV advertizing and newspaper ad services
- Payroll services or benefit programs for employees
- Cash advance or merchant funding services
- Leasing or credit card terminal upgrade offers
- POS software solutions and hardware
- Printing services, signs and banners that can increase traffic and sales
- Discount cards that can be handed out to local customers
- Web site and e-commerce shopping cart services
- Restaurant paging systems and time management and payroll services
Do not present too many options and push merchants into choosing one. By researching and understanding a merchant's business and potential pain points, you can make use of the best options.
Unfortunately, not all merchants will respond to offers or cross-selling attempts. Don't get discouraged; understand that some prospects will open up, and others will slam the door. Focusing on products that will generate money or increase business efficiency for merchants is best. Services must also generate revenues for you.
Most third-party options that are not internally supported are simply referrals and should not require much time. Keeping these readily available will reinforce your commitment to helping merchants.
Cross-selling additional services to your merchant base should not become a hindrance or compete with core offerings and payment-related services. The initiative should be casual and used to identify helpful options that can benefit merchants' businesses. Doing this will reinforce your commitment to your customers and bring you closer relationships with them.
Expanded focus
No longer are price and rate the only factors merchants look for when selecting a provider. Merchants truly want and need providers that offer a complete package aimed at their needs. The increased cost of accepting payments today coupled with interchange increases have made many merchants unsure about how to prudently implement technologies that help their businesses thrive.
What we offer merchants, and how we offer it, plays an important roll in the overall longevity, profitability and success of any sales office. Stripping down product offerings and limiting the solutions that MLSs sell does not help anyone. More tools and solutions are needed to stay on top of the competition and maintain profitability.
The days of selling just bankcard solutions are fading away. Our merchants want more and are willing to pay more. Merchants will leave a processor with a lower rate for the right mix of solutions and quality service.
The core objective should always be to help merchants be successful - with their success, we thrive as well. Make a commitment, and follow through by going back to your merchants before it's too late. You will be rewarded and feel good that you contributed to the growth and longevity of your merchant portfolio.
Christian Murray is the Director of Business Development for Global eTelecom Inc. He has more than 12 years' experience within the payments industry. GETI provides check processing and gift and loyalty solutions. For more information, visit www.checktraining.com or www.giftcardtraining.com (the sites are compatible with Internet Explorer only). You may also contact Christian directly at 877-454-3835 or cmurray@globaletelecom.com.
Whether you want to upgrade your POS offerings, find a payment gateway partner, bone up on fintech regs or PCI requirements, find an upcoming trade show, read about faster payments, or discover the latest innovations in merchant acquiring, The Green Sheet is the resource for you. Since 1983, we've helped empower and connect payments professionals, starting with the merchant level salespeople who bring tailored payment acceptance and digital commerce tools, along with a host of other business services to merchants across the globe. The Green Sheet Inc. is also a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals.
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