Drew McLellan, over at the always excellent Marketing Profs, ruminates over the age old question – when does lending your vast expanse of grey matter, but limited time, to someone else’s business problems become a business transaction? When does that little bit of advice your friend, customer, partner, former colleague or whatever go from “friendly” to “billable”.
The esteemed Ronin Marketer, John Wall, has an excellent post that shows his personal dividing line between “lawyer” and “marketer”.
The BMBY take
There’s some old tired line referring to pre-marital sex which goes something like “why should (he) buy the cow when he’s getting the milk for free?”
Quite frankly, this sort of thinking should be consigned to the cultural dustbin along with the rest of the domestic stereotypes perpetuated since the 1930’s.
As a consultant personally and as an industry in general, we’re more than happy to give away some milk for free. Plenty of other industries do this as well.
Who else gives away free milk?
Banks
Retail banks also give sound advice on personal investing away for free with the understanding you’ll buy your investment products from them.
Telcos
The telecommunications industry heavily subsidizes your mobile handset in order to tie you in to annual or even multi-annual contracts.
More banks
Investment banks publish research documents, prepared by expensive, star analysts that they distribute for free with the understanding investors will come to the bank for the actual trade if they want to move on the information.
Venture Capitalists
I’m sure VCs like Rick, Paul and Fred all give away their fair share of valued information with the understanding the recipients will come to them with potential deals.
Supermarkets/Grocery Stores
Supermarkets bring you in with loss-leaders and up-sell you to higher margin products. Supermarkets will literally give away the milk to get you to buy a steak.
And that’s what we do too.
If you think the milk is good, wait until you try the steak.
Much of our best thinking, as an industry, is pushed to potential clients, usually in the form of proposals, with the understanding that, if they like the ideas, there is a moral obligation for them to use the firm who conceived the idea to execute them. I would hypothesis that this is the case even if you are an agency of record or have a longstanding relationship.
We also do, to stretch the analogy almost to breaking point and to really mix my metaphors, tasting sessions when we invite people to test drive our thinking.
But where should we draw the line?
My feeling, and this is just my feeling, is that once the conversation moves from the abstract to the concrete, any information worker or consultant should be able to charge.
From my perspective, I’m happy to talk until the cows come home about why you should do something and the best practices involved. There is an expectation that you will come to me if you want to actually put these theories and ideas into practice – after all, if you like my ideas that much, why do you think someone else will be able to execute against them more effectively than me?
However if you start asking me specific questions about how to apply that to your business, in a concrete fashion, well I should be able to charge for that.
For instance, it only takes a few moments for me to realize your Web site is suffering from a lack of Google juice and that you need to benchmark where your site is at compared to your competitors. It only takes me a few minutes to go through how I would do such an audit. You can have this for free.
But to actually compile those key words and search major search engines to see where you stand in the search engine results pages (SERPs), to actually look through your content, code, page build, folder structure and link building strategy, well that takes time. Time I have to charge for.
And if you trust me enough to ask my advice about search, why wouldn’t you trust me to actually perform the tasks I’ve recommended?
Trust has to go two ways and the agency has to show some good faith when looking to attract new business. If the client is expected to trust an agency with its budget, agencies must trust clients with their ideas.
Ed Lee's Blogging Me Blogging You | @edlee 
Ed,
Great post!
It doesn’t feel natural to give away the milk! We’ve just gone through similar discussions about how much to put in to a proposal and decided in the end to let the milk flow free.
I once read about this lawyer who was getting irritated with people always asking for advice at parties. His solution? Chat with them as much as they want. The next day he would send them a bill for his time. He concluded that either a) They would pay the bill and it was worth his time or b) They wouldn’t bug him again.
I don’t know how long this guy stayed in business but it was many years ago when I read that story. I agree that trust is crucial for building successful relationship (professional and personal).
great post!
z
Ed, unfortunately we (the industry) perpetuated much of what is going on here. Free advice is one thing, but giving away strategic insights and plans will get us all in the poor house eventually. I remember seeking a lawyer to retain before I started MAVERICK . I knew I could be dealing with a potential legal fight in the future. I saw three lawyers for one hour each. Two out of the three charged me for the hour meeting. The last guy didn’t charge me, but added his time in the first retainer amount when I hired him on. I paid all three. I asked for their opinion and advice. Getting an invoice from them was not a shocker. My interior designer charged me from the minute she stepped into my home, I paid for her visit to my house as well as the creative board she designed for me. No free ideas, no free creative. Nothing on spec. She had no problem shoving the invoice in front of my face after our first meeting.
Is a lawyer’s time more valuable? My interior designer? Isn’t our advice just as meaningful? Don’t we create solid ROI with our counsel? Shouldn’t we set the rules of engagement as soon as a prospect walks through the door? Lawyers get away with it, even my designer does .. so how come we can’t do it?
Ed, if you can solve this one, we’ll all be grateful to ya!
Hi Ed,
In my industry, small business computer consulting, we usually like to think of a sales call appointment as a mutual interview process.
You should be checking out your prospect to see if he/she is someone you can see yourself building a long-term relationship with, as much as your prospect is checking out you/your firm.
Many inexperienced computer consultants make the mistake of spending several visits and several hours of potentially billable time doing free consulting and free proposal generation… only to find out that their time was being used/abused for leverage against the incumbent vendor.
Proper lead qualification is really the key, as least in our industry. But I can’t imagine a supermarket or warehouse club sample dispenser person trying to figure out whether to give you the lobster spread sample on a cracker, based on whether you’re truly a prospect for buying a tub of lobster spread.
Thanks for the great post.
Joshua Feinberg
There is no clear line like the line called money! If the purpose is for them to make money – then charging for your service is a must. If it is non-profit, then do it and take a tax break for it.