368 6 Ideas to build Urgency & Scarcity into Renewals

Okay. Renewals just around the corner. I am. It's so important to me that you nail your renewal season this season, because it not only impacts the profitability of your entire next year, but every year following that. You know that one client where you're always afraid to increase fees on them and you're like, I don't even want to send it to them. And you put it off, and you put it off and you just don't do it. And then they slip into next year with, like, no increase in their fees. And then you get there the following year, and you're like, come on. How did I let myself do this? Getting lazy on renewals is doing that on your entire client base, buddy. We want to tighten every little screw, every little bolt, optimize every little aspect of your renewals. Because if we squeeze another five bucks, another ten bucks, another five hundred bucks out of each of these, you better believe a couple years, that's a bigger boat. Okay, so today we're talking about some ideas just for how to optimize this a little bit more. My goal is you'll come out of today with one actionable thing you can plug in. Come on in. Let's do it. Okay. A number of today's ideas are from philosopher Alex Hermosi. Instagram's top business advice meatball. It's really easy to make fun of Alex Hormozy, but arguably the last two books he's written are like some of the most important business books we've had in the last five years. It's actually interesting. I've been listening to some older business books lately. Like 10, 15 years old. Some of them, they starting to not hold up. Like the world has changed a lot. Not only in the last five years, but even in the last two or three years as algorithms changed and everything has since become TikTok ified and like cable tv, like media, all that stuff is gradually being dismantled in favor of everything being consumed in algorithms. That's a huge change. And then the last two years, artificial intelligence came along. It's massively changing some things, not so much changing other things and generally stressing everyone out. A lot of old wisdom doesn't apply anymore. Honestly, Hermosi's last two books, like, they are super helpful books to help you escape traditional service business thoughts, which is kind of the goal. How do I escape trading my time for money? If you read one, I recommend $100 million offers. We'll link it down in the show notes. It is a. It's like a third grade Reading level. It's a quick read. I guarantee going through it, you're going to pick some stuff out of it. Some of the kind of like the, the section that we're drawing on today and I've got like six, six specific things I think he could plug into your renewals here. It's drawing on a bit in the hundred million offers book where he introduces basically five ways to quote enhance an offer. So an offer in our case, like if we're going to send a proposal over to a client in this context, that's what I'm framing as the quote unquote offer. Here's what I'm going to do for you. Are you willing to pay for it? Now there's a whole bunch of different types of offers. We're not going to get into that. We're really just talking about renewals here. Maybe like setting a proposal for year end tax planning or tech stack advising or something like that. But to rapid fire through these five ways to enhance an offer, number one, scarcity. So Chanel produces way fewer bags than there is a market like that is willing to buy them. Ferrari does the same thing. They could sell three to four times as many cars at where they price them as they do, but they don't to maintain scarcity, like kind of that specialness around the brand. But when it comes to professional service businesses, scarcity is usually framed as an apology because you hit capacity rather than like Brahmin demand. People, people want this, they like what I'm doing and so I'm scarce and yet appreciate that that's not what we do. We're like oh yeah, no, sorry, we committed too much and now I'm not going to be able to get it back to you in a few months time. They're like two sides of the same coin. Capacity management and scarcity. Second way to enhance an offer urgency. It's not enough to give something to someone to buy to pay you money for. The more optimized version of the same thing is why should I do it now? And some things we do inherently have that urgency built in. Like they're forced by tax deadlines. They're, they are the most lovely crutch in running an accounting firm is the fact that everybody has to file their tax return by a certain deadline. It pushes people to actually get that thing done. But if you were selling window washing, then what that like where's your tax deadline for window washing? Right? Like we've kind of got this nice thing built into the way that we work, you know for accounting firms, that's oftentimes it's also tax deadlines, even if you only do bookkeeping because the clients kind of want compliance books at the end of the year. They want to get all that stuff over them so they can get it over to their tax professional. We in some ways have urgency built into what we do, but that deadline can also work against us because we have all fallen victim before to the client only taking action when they absolutely have to. Because that, that tech tax deadline is like bearing down on them. Right. And that can be a really, really frustrating thing. And it means sometimes you have to manufacture your own urgency. Third way to enhance an offer a bonuses. And I think about bonuses is they don't entail given discounts or negotiating on pricing or anything like that. A bonus could be, I'll hop on like a 30 minute call and we'll work through this thing. Or I'll give you this, you know, PDF guide for xyz, our favorite software platforms for this or that, our chart of accounts template. Like what are various bonuses that fit nicely in with the, with the offer you're putting in front of them? Where you could say like, you know, if you do it by the end of the week, because this is great for us, if you can, you can do it faster. You do by the end of the week, we'll give you this bonus or that bonus. It is not negotiating on price, it's not a coupon code, it's nothing like that. We don't do that in our service businesses. It's, you know, a product or access to a course. Maybe it's a call. But just be careful not to frame that as discounted work because at the end of the day we don't want that stuff to be negotiable. Fourth way to enhance an offer, a guarantee. And this is the most uncomfortable thing for service businesses. If I am a window washer, sure, I guarantee you can see through your windows at the end. Otherwise I'll give you your money back. That's probably a bad example of guarantee. But guarantees serve to like pick apart what is the biggest concern that somebody has from doing this. So for example, let's say you're pulling a client into a tax planning engagement and they're like, is this really going to be worthwhile? To me, I think you would be shocked and like, we can't tie this to outcomes here, otherwise it becomes contingent fees. But I think you would be shocked how few of people would take you up on a money back guarantee if they weren't happy with the service that you delivered. Obviously, if they, if they take you up on that, they're probably gone after that. Which may not be the worst thing. If there's somebody on your client list that's willing to do that in the first place, and taking advantage of that guarantee means they're going to go somewhere else, that may actually be the very best thing. That's almost like, I think it's Amazon that basically offers people bonuses to leave because they don't want people hanging around that are kind of on the fence. You're almost doing that by offering a guarantee in that context. But the mental math here and there's like, I think we get blocked by. We're like, no, it's a really valuable thing that. How could anybody dare not pay me for this? Because the value that I see in it, the value that I assign to it, at the end of the day, all that matters is if we extend a guarantee, will it increase the volume of folks that will ultimately come in who otherwise would not have? And oftentimes when you know something's going to be valuable to somebody but they don't understand that yet, that's a great situation for a guarantee because you got to get them over the hump of believing it is going to be worthwhile, you know more than they do. So you probably have a better perspective into whether it actually will be or not. And like, spoiler alert, it has to actually be useful what you do. Like, we got to deliver. But if they're on the fence and you put up a guarantee, that's like, if in, you know, 45 days, this wasn't useful for you, or you don't feel like we delivered on what I'm telling you here, let me know, I'll refund you. This is a thing that is unthinkable for most, but will have a oftentimes significant impact on the amount of people that will opt in who otherwise would not have. That's the one thing to keep in mind is how many people did this pull in who I otherwise wouldn't have been able to pull in? And then the second thing on the other side of that, you will be surprised at how few people will ever actually take you up on that. Even people who are like, I don't know, was worth it or not. But at this stage, I'm not going to ask for back. And the fifth way to enhance an offer. Hermosi does a bunch of stuff around naming, like calling out the specific avatar and the goal and the time frame it goes Pretty deep. I'll defer to the book on that. But like a super elementary version of this is like November dental tax planning. Like it has to happen in November. It's for dentists. Your pre Christmas drop dead essential tax planning thing, tasks, program, whatever it is, you get a time frame in there. I guess I didn't really call out an avatar there. Pre Thanksgiving beekeeping action items, maybe not specific enough around what it is, but you get the idea. You give it a name that is kind of inherently time blocked and it calls out who it's for and the beekeeper's like oh, oh that's, that's me. I got went Thanksgiving. We better get to that. All five of those things. Scarcity, urgency, bonuses, guarantees, naming. They can all enhance an offer, which in our case means get a couple more buckaroos for that thing that maybe they would have said yes to otherwise. And all five of them can be combined. All five of those things working in, in beautiful harmony. If you nail those things, you better believe somebody is going to pay more than they would have otherwise for that not optimized version. That's the value of doing this stuff. And again, because in our business we have the beauty of work being inherently recurring. Every time you put a proposal in front of a client that is optimized, that's a compounding opportunity where the baseline for next year is higher than it would have been otherwise. It's compounding, compounding interest. The eighth wonder of the world or something like that misattributed to Albert Einstein. I'm sure this is like compounding pricing. I don't know what it's like. Not good at catchy things like this, but you get what I mean, right? If we can squeeze a little more juice out of this year, it means next year we're starting in a better place too. This episode is sponsored in part by Live Flow. You see the the demo day we did on YouTube yet live flow dashboards encourage you to check it out. It's all of a, I think a seven minute demo showing off Live Flows new release. Super simplified, easy to use financial dashboards. Gonna feel super familiar for anyone that's, that's used that Live Flow product before. Connects your qbo, your Xero to your Google Sheets or your Excel, like immediately have this picker to be able to pull any old data from any of your connected client files. But now we can pull them into these like super flexible little widgets like in a, in a dashboard view, you literally just share a link with the click client went through some cool examples in that video of like clients I had that were more like tradespeople that wanted mobile updates and I would text them something every morning. Man, I can make a little mobile friendly dashboard where they could hop in and as long as the underlying accounting ledger is up to date, they could see some really cool insights there that you customize yourself, templatize, turn that dashboard into a template and then literally just from a dropdown, connect another company or company consolidation and it populates the same dashboard with that different company data. Super cool stuff. You haven't seen that that demo day yet. Go to YouTube. How would I find it? I'd probably search Jason Live Flow Dashboards. Pretty cool release from the folks at Live Flow. Learn more about and check out the link down in the show notes. This episode is sponsored in part by Team Up Boy. Team up helps you find talented offshore accounts in the Philippines that you can hire directly, add them to your team just like anybody else that you would hire remotely. I was talking with somebody the other day who recently launched a solo firm. They're growing, they kind of want to hire, but the cost of making that first hire feels really burdensome. What do you think? I told them, hire offshore whether the cost is burdensome or not. That's where I'd start. In fact, when I drafted my first 20 employees in that podcast episode a couple months ago, first two or three were all offshore. Talk with another firm owner who bought a firm from a partner who's in the process of phasing out along with another one of their biggest producers. And she's like, I got to backfill this. I got to hire all this work, work. Somehow the former managing partner and their most senior producer, what do I do? I'm like, you're rebuilding a completely different firm from scratch, basically. And the way that I would do it, the way that I would keep getting the work done, I would hire onshore people to be client facing. But I'd start making offshore hires now because I can find them quick and they're really stinking good. That was my experience anyways, for the last five hires I made in my firm were offshore. Obvious cost benefits. But you know what? They're capable of doing just about anything that anybody in your firm can do. I'd encourage you to learn more, ask the embarrassing questions, get on a call with Team Up. Just learn. Because it's increasingly becoming the norm. I'm hearing from people almost every, honestly, almost every week now that are like, you convinced me I'm doing it. I'M excited about it. And the only two offshore like placement groups we work with on this podcast, super, super vetted, talked with a lot of people that were blown away by the good experience they had. So if you're thinking about it, check out Team up link down in the show notes. Okay? Six specific things, wee little adjustments, ideas you could plug into your renewal process that might make you enough money to buy me a nice seafood dinner the next time we're at the same accounting conference. Number one, the window strategy. Like tax planning window, chart of accounts, review window, tech stack review window, whatever it is, send an initial email before a window of time saying all of the work that's going to happen. This opportunity, it only happens within this itty bitty window of time. There's a whole bunch of versions of this that we see, like, you know, cohort based offerings where it's like, we only kick off. We only did two cohorts a year and now's your chance and you're like, oh, geez, if I'm going to do it, I got to do it right now. And like this quote unquote window strategy, it's kind of the truth. And actually the best version of all these optimizations is the honest version of these we've all seen. I don't really believe that it's going to be more expensive for the car wash to clean my cars if I don't buy this thing by Valentine's Day. I'm just not buying that. This, on the other hand, it's real. Like there's a window of time where it's best to do certain things, or windows of time where that's the only timeframe where you're gonna have the capacity to do that thing. It's again, two sides of the same capacity coin where if we just call it out more explicitly and say, this is the only chance that we have to help you on this is within this time frame, you're gonna cause a few more people to get up off their keister and make a decision. It is the, the whole, like, what's the expression? The fact that we are like more motivate, motivated by the potential for loss than we are the potential for gain. And the great thing here is, is that it's honest. This is the only time we're going to do it because it is the best time to do it. And you may, that may just sound like, well, that is, that's just a deadline. Jason the Doy, there's a deadline. Years end, tax deadlines come. The difference here is in how we communicate it. So 20 days before that window starts, are you contacting all of your clients to say this is coming, get ready for it? 10 days before, are you sending them a reminder the day it starts, are you saying the window just opened? But also this is where we start layering in other kind of sources of scarcity that we're going to talk about. Or do you send a client a proposal or do you send them one email and expect them to respond? It's all in how we communicate it. Frame it up as an opportunity that is only available, you know, oftentimes once per year within that time frame. Right. Now that doesn't mean that you can't do tax planning for other clients more throughout the year. So maybe this is, maybe this is for like new clients coming into tax planning for the first time. Maybe you're only willing to help them in like a one month window late in the year, something like that. Your business ought to have boundaries like that. All I'm saying is let's communicate those boundaries because it'll actually get them a little more motivated to be like, oh geez, okay, maybe we got to get on this, okay, number two, capacity based renewal system or opt in system. As soon as that that window opens, you better believe you need to tell people how many seats are on the bus. Because if that window's a month, they're like, oh, I still got a month, maybe I'll just wait. But if there's only 15 seats on the bus and four are already taken, and then in a few days, you know, eight are already taken and you're actually communicating to this, this to people, or your proposal platform will let you put like a somewhat live updating figure of like how many slots are available in there. Now we are combining both urgency and scarcity. The fact that at the end of the day you really can only do so many of these. But when's the last time you gave your clients a window into your own capacity? Besides apologizing when they complain because it just took you five months to do the tax return. Even just layering in those first two things, you will see a noticeable difference in motivating people to take action. I mean, there's a kajillion examples of this. My accountant community. 80% of the signups we have for my accountant community happen before price increases and happen before cutoffs. When we place people into mastermind groups. It is open 12 months a year, but literally 80% of signups happen before those two things. That's just human nature. I don't have the benefit of tax deadlines. We have kind of some of these systematic things where there are milestones, things we do, limited times during the year that manufacture some urgency. But that's human nature. I saw some crazy statistic of online real retailers. You have a promo that'll run three days and the percentage of people that will buy in the final four hours, like it's usually more than the entire rest of the time combined. Not every aspect of that holds up in professional services in what we do. But you better believe that there is a core part of being a human that is still motivated by that fear of missing out on that opportunity. Okay, idea number three. Expiring proposals. So this isn't just the window of time or a deadline for when they need to opt in by rather it is the expiration of the proposal of the offer that you're putting in front of them. Because that can have an entirely different set of deadlines than like the window where you do that work. Let's say the window where you do the work is a month long, but you may need to to get them to agree to that work for various reasons before that. And if all you do is send over a proposal with no timeframe on it at all, or you send it to them a couple of weeks before that month long window opens, the assumption is going to be they've got like 40 days or something like that. And that is not a reason for them to open the email to be thoughtful about it today. They will likely shelve it and then you're having to pester them to get them to care about it as opposed to this proposal expires in seven days. This is your chance. If you're not sure and you're not pumped about taking advantage of this right now, I don't want you to. So I'm giving you seven days to opt into this because we got to get all of our ducks in a row to make sure we can execute on all this, you know, over the next month or whatever. It is a little bit savage, but honestly, I love it. You got to give them a reason to make the decision today. And for you, there are very good business reasons why you should enforce this. Again, this is like honest scarcity. This isn't something we're contriving. It is going to make your life easier to plan out how you're going to do all this work. And simply by, by enforcing that and communicating that clearly with the folks on the other side of the offer, you are going to stir up within them. Like a greater motivation to do something about it than they would otherwise have. Idea number four, how about this? Priority access to early renewals. So let's say there's a one off, one off project like doing some tax planning or doing some tech stack advising or adding bill payers or something like that. Connecting that to some sort of priority access to something else. A juicy exclusive. That's a nice little bonus, right? That's an example of a bonus. Giving them an added incentive to opt in today to ensure that they don't then miss out on that other thing. Right. So it's like double fomo. Now they're decreasing the likelihood that they miss out on this other potential thing too that might be useful for them. So it's like a double whammy. Why would I not do this? The whole like through line of the $100 million offers book is, which was actually taken from what's his name, a different marketer. How do you create an offer that's so good that someone will feel dumb saying no to it? That's the whole goal here. Create something so compelling, stack all these incentives in a way where it's like, well, of course I need to say yes. It is the professional services version of the knife that can cut through a shoe. You buy the first knife for $35 and then they give you 64 more knives for free. Are you kidding me? What a deal. Okay, idea number five. To lock in a future opportunity. Does that feel like double dipping? I don't know that you could have counted that as a, as a whole standalone one. Jason, what is a second thing that pairs very nicely with what you're proposing to them? If you are doing say tech stack advising and you've got something else in the works, you're running an event, something like that, can you guarantee them a seat? Can you guarantee them access? Is there some other incentive or bonus that you can connect to this then? Idea number six. Absolutely nail the email sequence. Most of us don't have like any comfort level or much experience with email marketing tools and all that they enable for us. And you don't have to go whole hog. Like for sure, if you want to geek out on the full email marketing like growth hacker version of this. Great. At the very minimum, this is sending an email to some folks and hopefully putting them in the BCC instead of the cc. But plan out ahead of time what that countdown sequence looks like up until the day that they can start opting in, but don't start there. That sequence ought to Continue as availability decreases. Because we're not only telling them ahead of time, you have limited time to take advantage of this. We're also telling them, you know how I said there was a limited number of seats, those limited number of seats are going away now. Oftentimes you will start this process and you're like, yeah, I'm totally going to do that. And then you don't because you get busy with all these other things. That sequence arguably is the most important thing because it's reminding people of what you're doing. And we need to over communicate. We chronically under communicate because it's something that's very important to us and 100% of our attention is on it. But everybody else is worried about their own stuff. So the reality is they're forgetting about you. They're not fixated on this stuff like you are. So we need to over communicate anyways, more so than we do already. But plan this out right down to the last 24 hours, they have to take action. Or what happens when you run out of inventory? Is there a different offer that they get then? Or what does the follow up look like when they accept your offer? Is there an upsell that you only show them after they accept that offer? Plan out all of those sequences. You're not going to nail it on the first try and you're not going to nail it in the first year. But this is the kind of thing where over time you can kind of optimize it year over year and develop these scripts. You could even hire a like a copywriter if you really wanted to juice this. And it's honestly I like, I'm so convicted. This is absolutely worth doing because how those renewals go down is truly defining the profitability of it, at least the next 12 months. But in reality, as long as you work with that client, because that renewal price is the new normal, that's the new expectation going forward. So it's worth investing in it, it's worth putting some thought into it. Maybe even like jamming with some other firm owners on like, hey, here's what I'm thinking. What do you think? Hey, here's what I'm thinking. Here's what my proposals look like is actually something I want to do in, in the community is like little like meetups where everybody kind of shows off what they're doing with their proposals to try to get some ideas from each other. Because the delta between a super unoptimized version of this and the optimized version of this. And I think there is an optimized version of this that is not slimy like that was my big blocker in the past was this feels like shady online like DTC e. Com somebody shilling me something on the web like I'm an accountant. I wouldn't do something like that. There is absolutely a non slimy version of this that is simply communicating the inherent constraints you have and how many people that you can help. Again, super recommend you check out the book. I'll link it down in the show notes. You got any ideas or stuff that you've done in the past that's made a difference? Pop that stuff in the comments. And thanks for coming and hanging. Sam.